Growing sustainably.And profitably.
The Oudh Sugar Mills LimitedAnnual Report 2008-09
The Oudh Sugar Mills Limitedwww.birla-sugar.com
Late Dr K.K. Birla
(1918-2008)
Our Source of Inspiration
print anderson 9831778971
CONTENTS
Corporate Information ......................................................................................... 2
Notice ........................................................................................................................ 3
Key Figures ............................................................................................................... 4
Chairman’s Message ............................................................................................. 6
Directors’ Report ................................................................................................... 8
Management Discussion & Analysis Report ................................................ 12
Report on Corporate Governance ................................................................. 24
Financial Statements (Standalone) ................................................................ 35
Financial Statements (Consolidated) ............................................................ 69
Financial Statements (Subsidiaries) .............................................................. 99
BOARD OF DIRECTORS REGISTRAR & SHARE TRANSFER AGENTMr. Chandra Shekhar Nopany, Chairman-cum-Mg. Director Link Intime India Private LimitedMr. S.V. Muzumdar (Unit : The Oudh Sugar Mills Limited)Mr. Ashvin C. Dalal C-13, Pannalal Silk Mills CompoundMr. C.B. Patodia L.B.S. Marg, Bhandup (West)Mr. Rohit Kumar Dhoot Mumbai 400 078Mrs. Madhu Vadera Jayakumar Tel. No. : 91- 022–2596 3838Mr. Haigreve Khaitan Fax No. : 91- 022–2594 6969Mr. J.N. Godbole e-mail : [email protected]
COMMITTEES OF DIRECTORS REGISTERED OFFICEFinance & Corporate Affairs Committee P. O. Hargaon District – Sitapur, (U. P.)Mr. Chandra Shekhar Nopany Pin Code – 261 121Mr. S.V. MuzumdarMr. Ashvin C. Dalal CORPORATE OFFICEMrs. Madhu Vadera Jayakumar Unit No. 210/212, Solaris - 1, ‘A’ Wing, 2nd Floor
Saki Vihar Road, Opp : L&T Gate No. 6, Audit Committee Andheri (East), Mumbai – 400 072.Mr. Ashvin C. Dalal Tel. No. : 91-022-2847 0249Mr. C.B. Patodia Fax No. : 91-022-2847 0275Mr. S.V. Muzumdar e-mail : [email protected]
Mr. Rohit Kumar Dhoot
HEAD OFFICEInvestors’ Grievance Committee 9/1, R.N. Mukherjee Road,Mr. S.V. Muzumdar Kolkata - 700 001Mr. Rohit Kumar Dhoot Tel. No. : 91-033-2243 0497/8 Mrs. Madhu Vadera Jayakumar Fax No. : 91-033-2248 6369
e-mail : [email protected] Committee Website : www.birla-sugar.com/osugar Mr. S.V. MuzumdarMr. Ashvin C. DalalMr. Rohit Kumar Dhoot SUGAR MILLS
1. Hargaon, Dist. Sitapur, (U. P.)EXECUTIVES 2. Rosa, Dist. Shahjahanpur, (U. P.)Mr. G.N. Pareek, Company Secretary 3. Narkatiaganj, Dist. West Champaran, (Bihar)Mr. Naresh Chandra Paliwal, Executive President, Hargaon 4. Hata, Dist. Kushinagar, (U.P.)Mr. Chandra Mohan Singh, Executive President, NarkatiaganjMr. B.K. Malpani, Executive President, Rosa DISTILLERYMr. S. K. Premi, Executive President, Allahabad 1. Hargaon, Dist. Sitapur, (U. P.)Mr. P.K. Saini, Executive President, Hata 2. Narkatiaganj, Dist. West Champaran, (Bihar)
AUDITORS CANNING FACTORYS.R. Batliboi & Co. P.O. Bamrauli, Allahabad, (U. P.)Chartered Accountants
CO-GENERATION POWER PLANTADVOCATES & SOLICITORS 1. Hargaon, Dist. Sitapur, (U. P.)Khaitan & Co. 2. Narkatiaganj, Dist. West Champaran, (Bihar)
3. Hata, Dist. Kushinagar, (U.P.)BANKERSState Bank of IndiaIDBI Bank Ltd.Axis Bank Ltd.State Bank of HyderabadUnion Bank of IndiaBank of Rajasthan
CORPORATE INFORMATION
The Oudh Sugar Mills Limited2
The Oudh Sugar Mills Limited Regd. Office : P.O. Hargaon, Dist. Sitapur (U.P.), Pin - 261 121
Notice is hereby given that the Seventy-seventh Annual General Meeting of the members of The Oudh Sugar Mills Limited will be held at the Registered Office of the Company at Meeting Hall, Oudh Sugar Mills Complex, Hargaon, District Sitapur, Uttar Pradesh, Pin – 261121, on Thursday, the 26th November, 2009 at 2.00 P.M. to transact the following businesses :
Ordinary Business :1. To consider and adopt the audited Balance Sheet as at 30th
June, 2009, the Profit and Loss Account for the year ended on that date and the Reports of the Directors and Auditors thereon.
2. To declare dividend on Equity Shares.
3. To appoint a Director in place of Mr. Rohit Kumar Dhoot who retires by rotation and being eligible offers himself for re-appointment.
4. To appoint a Director in place of Mr. Haigreve Khaitan who retires by rotation and being eligible offers himself for re-appointment.
5. To appoint Auditors and to fix their remuneration
By Order of the Board
Place : Mumbai G. N. Pareek
Dated : 25th August, 2009 Company Secretary
NOTES :
1. A member entitled to attend and vote at the meting is entitled to appoint a proxy to attend and vote instead of himself and a proxy need not be member. The instrument appointing proxy should, however, be deposited at the Registered Office of the Company not less than forty-eight hours before commencement of the meeting.
2. The Register of the Members of the Company will remain closed from 23rd October, 2009 to 24th October,2009 both days inclusive for the purpose of payment of dividend for the year ended 30th June, 2009 and from 24th November, 2009 to 25th November, 2009, both days inclusive, for the purpose of holding the Annual General Meeting of the Company on 26th November, 2009 in terms of this notice.
3. In terms of Article 82 of the Articles of Association of the Company, Mr. Rohit Kumar Dhoot and Mr. Haigreve Khaitan Directors, retire by rotation at the ensuing Annual General Meeting and are eligible for re-appointment. A brief resume of these Directors, nature of their expertise in specific functional areas, names of companies in which they hold Directorship and Membership/Chairmanship of Board Committees and Shareholding, as stipulated under Clause 49 of the Listing Agreement with the Stock Exchanges, are provided in the report on Corporate Governance forming part of the Annual Report. The Board of Directors of the
NOTICE
Company recommends their respective re-appointments.
4. Members are requested to notify the change in their addresses, if any to the Company/Registrar & Share Transfer Agent. Members holding shares in dematerialised form should send the above information to their Depository Participants.
5. In all correspondences with the Company/Registrar & Share Transfer Agent, the members are requested to quote their account/folio numbers and in case their shares are held in the dematerialised form, they must quote their Client ID Number and their DP ID Number.
6. Pursuant to the provisions of Section 205A of the Companies Act, 1956, as amended, dividend remaining unclaimed/ unpaid for a period of seven years is required to be transferred to the Investor Education and Protection Fund of the Central Government (Fund). Accordingly, all unclaimed / unpaid dividends till the financial year up to and including 31.03.1999 have since been transferred to the said fund. There had been no payment of dividend after 31.03.1999 till the financial year 2003-04. Therefore, Members who have not encashed the dividend warrants so far for the financial years 2003-04 and for subsequent financial years may make their claim to the Company / Registrar and Share Transfer Agent. Once the unclaimed/unpaid dividend is transferred to the Fund no claim in this regard, shall lie against the Fund or the Company.
7. In terms of provisions of Section 109A of the Companies Act, 1956, nomination facility is available to individual shareholders in respect of shares held by them in physical form. The Nomination Form 2B prescribed by the Government can be obtained for the purpose from the Company/Registrar & Share Transfer Agent. The said Form 2B can also be downloaded from the Company’s website.
8. The Equity Shares of the Company are listed at The Bombay Stock Exchange Ltd., Phiroze Jeejeebhoy Towers, Dalal Street, Mumbai - 400 001 and The National Stock Exchange of India Limited, Exchange Plaza, Plot No. C-1, G-Block, Bandra Kurla Complex, Bandra (East), Mumbai-400 051. The listing fee for the year 2009-2010 has been paid to both the above Stock Exchanges.
9. Shares of the Company are compulsorily tradable on the Bombay Stock Exchange Limited and The National Stock Exchange of India Limited only in the dematerialised form. Therefore, shareholders holding their shares in physical form are advised to have their holding of shares in physical form converted into dematerialised form to have a better liquidity of their shareholding.
By Order of the Board
Place : Mumbai G. N. Pareek
Dated : 25th August, 2009 Company Secretary
Annual Report 2008-09 NOTICE 3
(Rs. in lakhs)
FINANCIAL HIGHLIGHTS
2004-05 2005-06 2006-07 2007-08 2008-09
Gross Turnover 37,628.42 52,864.92 46,812.06 35,393.59 58,309.13
EBDIT 8,096.94 10,297.66 129.80 5,280.58 10,578.35
Net Profit/(Loss) 1,116.04 4,536.51 -2,689.55 -451.27 1,917.38
Segment Revenue
(a) Sugar 32,078.00 44,890.74 37,817.54 25,839.51 47,532.93
(b) Distillery 2,335.20 3,792.89 3,919.33 4,677.10 5,017.13
(c) Co-generation 0.00 0.00 766.43 725.57 587.06
(d) Canning 1,191.37 1,433.10 1,741.15 1,913.72 2,507.44
KEY FIGURES
(Rs.)
PER SHARE DATA
2004-05 2005-06 2006-07 2007-08 2008-09
Earnings per share 7.05 24.96 -14.80 -2.48 9.34
Dividend per share 2.50 4.50 0.00 0.00 1.50
Payout Ratio (%) 35.46 18.03 0.00 0.00 16.06
Book value per share 53.69 73.35 58.34 55.48 62.82
Total Income (Rs. in lakhs)
55,933.882008-09
2007-08
2006-07
34,181.84
44,356.97
EBDIT (Rs. in lakhs)
10,578.352008-09
2007-08
2006-07
5,280.58
129.80
The Oudh Sugar Mills Limited4
PAT (Rs. in lakhs)
1,917.382008-09
2007-08
2006-07
-451.27
-2,689.55
EPS (Rs.)
9.342008-09
2007-08
2006-07
-2.48
-14.80
RONW (%)
13.922008-09
2007-08
2006-07
-4.48
-25.37
Net Worth (Rs. in lakhs)
13,770.062008-09
2007-08
2006-07
10,083.42
10,603.02
Debt-Equity Ratio
5.782008-09
2007-08
2006-07
8.58
5.32
Net Cash from Operating Activities (Rs. in lakhs)
21,338.032008-09
2007-08
2006-07
-10,929.49
3,770.23
Annual Report 2008-09 KEY FIGURES 5
CHAIRMAN’S MESSAGE
Dear Shareholders,
The year gone by has been unforgettable for the incredible impact
of the global recession on economies around the world.
However, we chose to prepare ourselves for the global rebound by
consolidating energies, optimising opportunities and augmenting
capacities. Adorning our portfolio, the New India Sugar Mills
at Hata, Uttar Pradesh, commenced operations this year with a
crushing capacity of 7,000 tonnes of sugarcane per day.
Our efforts paid off and reflected in a quantifiable increase in
total income from Rs. 34,181.84 lakhs in 2007-08 to Rs. 55,933.88
lakhs in 2008-09.
I am proud to iterate the challenges faced and overcome, the
market situation and the strategies we implemented to grow,
sustainably and profitably.
THE CHALLENGE TO GROW
The Sugar industry at present is under that phase of the peculiar
sugar cycle, where sugarcane production plummets sharply. The
sugar production in turn was also impacted. This can be attributed
to poor or delayed rainfall hampering sucrose formation, lesser
acreage and loss in farmer interest. This in turn resulted in a
declining stock/consumption ratio, finally resulting in soaring
sugar prices.
We took this in our stride and leveraged on the high prices and
enhanced realisations to augment capacities and de-risk our sugar
and allied products business.
The year also saw increasing attention paid to additional revenue
streams. Ethanol, a by product of sugar is one of the most effective
renewable biomass fuels available. Ethanol, when mixed with
gasoline, acts as an oxygenate, containing an enhanced oxygen
content which besides absorbing Carbon di-oxide can be used
as an alternative fuel. This not only reduces vehicular pollution,
but also plays a pivotal role in decreasing our dependence on non
renewable sources of energy.
We, at The Oudh Sugar Mills, have focused on what we do best,
that is producing high grade sugar and allied products. However,
attention was paid to minimise risks and grow responsibly. We
took efforts at generation of power using bagasse and alcohol
manufacture through molasses.
Thus, we have continued in the path of wholesome growth in a
Mr. Chandra Shekhar Nopany
Chairman-cum-Managing Director
The Board is headed by Mr. Chandra Shekhar
Nopany, aged 43 years, who is the Chairman-
cum-Managing Director. He is a Chartered
Accountant and Master in Science of
Industrial Administration from Carnegie
Mellon University, Pittsburgh, USA. He is an
eminent industrialist having vast industrial
experience in diverse fields like sugar, tea,
shipping, textiles, fertilisers and chemicals, etc.
He is the past President of Indian Chamber of
Commerce.
The Oudh Sugar Mills Limited6
year where we did not let the all pervading gloom take the upper
hand.
OUTLOOK
The Sugar production is further expected to fall in the coming
sugar season. Prices shall thus surge again. Sugar stocks are going
to fall further as Government looks to import more and more raw
sugar to tide over the shortage.
To face the vicissitudes of the economy, it is important to pay
increased attention to the extreme link in our system, the farmers.
We have never compromised on the timely payments for the
very upholders of our business. In fact, significant attempts are
being made through awareness oriented training and education
to familiarise the farmers with advanced methods in cane
farming so as to escape the fickleness of natural and crop cyclical
conditions.
Also, the Hata plant has commenced production and lending support
towards augmenting capacities. This unit also has co-generation
facilities. Thereby, we have always remained independent in terms
of power, as also using ethanol to reduce vehicular pollution and
bagasse as a ‘green’ source of power for our projects.
Therefore, we are looking forward to an era of global economic
rebound wherein we will continue to benefit from our values,
act on the opportunity, serve our people and grow further
responsibly.
I hereby take the opportunity to extend my regards to our
shareholders who have kept their faith in us and I hope they will
continue participating in all our future successes.
Warm regards,
Chandra Shekhar Nopany
We chose to prepare ourselves for the global rebound by consolidating energies, optimising opportunities and augmenting capacities. Adorning our portfolio, the New India Sugar Mills at Hata, Uttar Pradesh, commenced operations this year with a crushing capacity of 7,000 tonnes of sugarcane per day.
Annual Report 2008-09 CHAIRMAN MASSAGE 7
DIRECTORS’ REPORT
(Rs. In lakhs)
2008 – 09 2007 – 08
2. Gross Sales 58,309.13 35,393.59
Profit before Depreciation and Tax 5,636.82 1,602.76
To which is added/(deducted) :
Balance brought forward from the previous year 78.69 29.96
Deferred Tax Credit/(Charge) (1,062.33) 212.12
Income Tax Provision no longer required written back 1.67 0.60
Transfer from General Reserve -- (981.97) 500.00 742.68
Leaving a balance of 4,654.85 2,345.44
Out of this provisions have been made for :
Depreciation 2,632.03 2,229.68
Taxation [including Wealth tax Rs. 3.00 lakhs (Rs. 3.00 lakhs) ] 122.02 3.00
Minimum Alternative Tax (MAT) credit (entitlement) / Reversal (119.02) 3.93
Fringe Benefit Tax 23.75 2,658.78 30.14 2,266.75
Surplus available for Appropriation 1,996.07 78.69
From out of which following Appropriations were made :
i) Dividend 328.80 --
ii) Dividend Tax 55.88 --
iii) Transfer to General Reserve 100.00 484.68 -- --
Balance carried forward to Balance Sheet 1,511.39 78.69
To
The Shareholders,
Your Directors take pleasure in presenting their 77th Annual Report together with the audited Statements of Account of the Company
for the year ended 30th June, 2009.
FINANCIAL RESULTS & APPROPRIATIONS
FINANCIAL PERFORMANCE & DIVIDEND
3. There is marked improvement in the financial performance of
the Company for the year under review when the Company
has earned a profit (before Depreciation and Tax) of
Rs. 5,636.82 Lakhs as against a similar figure of Rs.1,602.76
Lakhs during the immediately preceding financial year. A
sharp fall in the sugar production in the country has resulted
in a revival of sugar prices and has improved profitability.
4. A detailed analysis of the Company’s operations, future
expectations and business environment has been given in
the Management Discussions & Analysis Report, which is
attached and is an integral part of this Report.
5. In view of improved profit performance of the Company, the
Board recommends a dividend of Re. 1.50 per equity share of
Rs. 10 each (previous year-NIL). The total outgo on this account
shall be a sum of Rs. 384.68 Lakhs including dividend tax.
The Oudh Sugar Mills Limited8
FORFEITURE OF EQUITY SHARES ALLOTTED ON RIGHTS BASIS
6. 2,53,125 Equity Shares held by 570 shareholders have been
forfeited by the Board due to non payment of call money of
Rs. 30 per share allotted in course of the Rights Issue during
2008-09. The Board had also waived off the entitlement
of interest on payment of call money received after 15th
January, 2009 and also refunded the said money received
from shareholders prior to such waiver.
CAPITAL PROJECTS
7. The Construction of Company’s Greenfield Integrated Sugar
Project of 7,000 TCD with a sugar refinery and Co-generation
Plant at Hata, Kushinagar, Uttar Pradesh has started crushing
operations during the year. Further, the supply of power
from the Co-generation Plant of 35 MW capacity at the said
unit shall commence during the ensuing season.
CORPORATE GOVERNANCE
8. Pursuant to Clause 49 of the Listing Agreement, the
Management Discussion & Analysis Report, the report on
Corporate Governance, Declaration of Managing Director
on Code of Conduct and Auditors’ Certificate on compliance
of conditions of Corporate Governance are all attached and
marked as Annexures “A”, “E”, “F” and “G”, respectively and
forms integral parts of this Report.
DIRECTORS
9. The Company has seven Non Executive directors having
experience in varied fields and a Managing Director. Two
directors Mr. Rohit Kumar Dhoot and Mr. Haigreve Khaitan
retire from the Board by rotation and being eligible offers
themselves for re-appointment.
10. Other information on the directors including required
particulars of directors retiring by rotation is provided in the
Report of Corporate Governance.
DIRECTORS’ RESPONSIBILITY STATEMENT
11. Your Directors confirm that -
i) in the preparation of the annual accounts, the
applicable accounting standards have been followed
and there is no material departures;
ii) such accounting policies have been selected and
applied consistently and judgments and estimates
made 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 of the
Company for that year;
iii) proper and sufficient care has been taken for the
adequate accounting records in accordance with the
provisions of the Companies Act, 1956 for safeguarding
the assets of the Company and for preventing and
detecting fraud and other irregularities;
iv) the annual accounts have been prepared on a ‘going
concern’ basis.
AUDITORS, AUDIT QUALIFICATIONS AND BOARD’S
EXPLANATIONS
12. The Auditors Report is self-explanatory. However, the Auditors
have made the observation regarding non-adjustment of
levy sugar price matters which is presently under litigation.
The Company’s view is that as the matter is under litigation,
provision will be made at the appropriate time. The Auditors
have also expressed their inability whether the Company
will be entitled to claim MAT credit of Rs. 836.59 lakhs. The
Company’s projections are that this would be claimed within
the stipulated time.
13. The Auditors, Messrs S.R. Batliboi & Co, Chartered
Accountants, retire and are eligible for re-appointment. The
said re-appointment, if made, will be in accordance with the
provisions of Section 224(1B) of the Companies Act, 1956.
9 Annual Report 2008-09 DIRECTORS’ REPORT
14. In accordance with the directives of the Central Government
under Section 233B of the Companies Act, 1956, Messrs D.
Radhakrishnan & Co., Cost Accountants, have been appointed
as Cost Auditors to audit the cost accounting records relating
to Sugar and Industrial Alcohol for the current year.
SUBSIDIARY COMPANIES
15. The audited accounts of Champaran Marketing Company
Limited, OSM Investment & Trading Company Limited,
Hargaon Investment & Trading Company Limited, subsidiaries
of the Company and Hargaon Properties Limited, a subsidiary
of Hargaon Investment & Trading Company Limited, for the
year ended 31st March, 2009 are attached. In this regard, the
Statement pursuant to Section 212 of the Companies Act,
1956 is attached and is marked as Annexure “D”.
CONSOLIDATED FINANCIAL STATEMENTS
16. As required under the Listing Agreement with Stock
Exchanges, Consolidated Financial Statements conforming
to the Accounting Standard 21 are attached.
PARTICULARS OF EMPLOYEES
17. Particulars of employees as required under Section 217(2A)
of the Companies Act, 1956 is attached as a separate
Annexure ”C” and forms an integral part of this Report.
ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND
FOREIGN EXCHANGE EARNINGS & OUTGO
18. Particulars in respect of conservation of energy, technology
absorption and foreign exchange earnings and outgo as
required under Section 217(1)(e) of the Companies Act, 1956
is marked as Annexure “B” and forms part of this Report.
FIXED DEPOSITS
19. As on 30th June, 2009, your Company had 635 depositors
with fixed deposits of Rs. 306.29 Lakhs. 30 depositors had
not claimed their Fixed Deposits amount of Rs. 7.30 Lakhs
as on that date. The depositors are being advised at regular
intervals to claim their deposits.
ACKNOWLEDGEMENTS
20. Your Directors take this opportunity of recording their
appreciation of the shareholders, financial institutions and
bankers for extending their support to the Company. Your
Directors are also grateful to the various ministries in the
Central and State Governments of Uttar Pradesh and Bihar,
the Sugar Directorate and the Sugar Development Fund
for their continued support to the Company. The Directors
also place on record their appreciation of the valuable
contribution made by the employees at all levels.
For and on behalf of the Board
Chandra Shekhar Nopany
Chairman-cum-Managing Director
Place : Mumbai
Dated : 25th August, 2009
The Oudh Sugar Mills Limited10
11 Annual Report 2008-09 DIRECTORS’ REPORT
MANAGEMENT DISCUSSION & ANALYSIS REPORT
SUGAR INDUSTRY OVERVIEW
Global Sugar Scenario
Sugar, both through beet or sugarcane, is produced in 125 countries. Currently, 69% of the world’s sugar is consumed in the countries
of its origin, whilst the balance is traded on world markets.
World Sugar Balance
2009-10 2008-09 Change
(million tonnes, raw value) in million tonnes in %
Production 159.042 154.225 4.817 3.12
Consumption 167.446 164.593 2.853 1.73
Surplus/Deficit -8.404 -10.368
Import demand 51.930 50.962 0.968 1.90
Export availability 51.964 50.903 1.061 2.08
End Stocks 53.234 61.672 -8.438 -13.68
Stocks/Consumption ratio in% 31.79 37.47
Source: ISO quarterly market outlook, September, 2009
The five largest exporters of Sugar in 2009-10, i.e. Brazil, Thailand, Australia, India and SADC are expected to supply approximately 79%
of all world free market exports. South Africa is currently ranked as the ninth largest exporter to the world market.
The price of raw sugar has increased to its highest level since March, 1981, as supply concerns grow. Reuter reports that a growing global
sugar deficit should help sustain world market prices despite the global economic downturn, which is seen as having little impact on
global demand for sugar. Global sugar prices are likely to stay high in the months ahead, making the sweetener import costlier than it is
now. World raw sugar prices rose steeply from only 11.4 cents/lb in January 2009 to 18 cents/lb in July, 2009. In August, 2009 raw sugar
hit a 28-year high and now is being traded at over 22 cents/lb. World market values demonstrated moderate increases during May, June
and July, but prices rocketed in August to a level, which has not been seen since the last large-scale sugar price boom at the beginning
of the 1980s. On 31st August, 2009 the ISA daily price was as high as 25.18 cents/lb.
Non remunerative sugar prices led to a significant decrease in sugarcane acreage especially in India leading to a sharp fall in production
during 2008-09. It was against this background of weak underlying fundamental factors that sugar prices rallied to new highs in the
latter part of the season 2008-09 as a direct result of the reduced sugar inventories and continued focus on ethanol coupled with
adverse climatic conditions in Brazil. These fundamental changes have attracted commodity investors to the future markets. The scale
and significant impact of this investment activity created a sense of dislocation between market fundamentals and futures prices. As a
consequence, futures prices have been increasing since December, 2008 and are prevailing around US 23.43 cents/lb for March, 2010.
ANNEXURE - A
The Oudh Sugar Mills Limited12
However, the industry is expected to remain in deficit in Sugar Year
2008-09 as well as 2009-10 after 2 continuous years of surplus
position. The world sugar economy faces a second consecutive
year of a large deficit projected at 8.4 million tonnes. The world
raw sugar output is expected to stand at 158.78 million tonnes
against previous estimates of 161.7 million tonnes. However, on
the demand side, the global consumption is expected to move up
by 3.2 % to 162.11 million tonnes with an additional consumption
of 3.3 million tonnes that could raise sugar prices further. (Source:
Financial Chronicle)
Indian Sugar Industry
India has been known as the original home of sugar and sugarcane.
Indian mythology supports the above fact as it contains legends
showing the origin of sugarcane. The advent of modern sugar
processing industry in India began in 1930 with grant of tariff
protection to the Indian sugar industry. The number of sugar mills
increased from 30 in the year 1930-31 to over 650 at present
and the production during the same period increased from 0.120
million tonnes to 26.3 million tonnes under the dynamic leadership
of the private sector. India is the second largest producer of cane
in the world next only to Brazil. Presently, about 4 million hectares
of land in India is under cane cultivation with an average yield of
70 tonnes per hectare.
The Indian sugar industry at present is highly fragmented in terms
of its location as a direct result of strict government controls on
licensing and distribution of sugar mills, and on the pricing of
cane and sugar.
Revival of Sugar Prices
Sugar prices have been slowly reviving since June, 2008 till the
first quarter of Financial Year 09 due to lower production and
increasing cane cost. Lack of vision and an unfocussed sugar
policy by the Governments at the Central and State levels with
multiple levels of controls have been continuously hampering the
growth of this sector. A short sighted policy to curb sugar prices
led to lower cane payments leading to lower acreage which has
been the major cause of this shortfall in production. An irrational
sugarcane pricing policy led to huge cane arrears that have also
compounded the problem. Sugar prices have increased despite
Government’s efforts to control the prices of sugar due to critical
inventory position in the country. This rise in prices have led to
better profitability and recovery for the sugar manufacturing
companies during the Financial Year 2008-09.
55.00
World Sugar Prices (c/kg)
50.00
45.00
40.00
35.00
30.00
25.00
20.00
Sep-
06
Oct-06
Nov-0
6
Dec-0
6
Jan-0
7
Feb-
07
Mar-07
Apr-0
7
May-0
7
Jun-
07Ju
l-07
Aug-0
7
Sep-
07
Oct-07
Nov-0
7
Dec-0
7
Jan-0
8
Feb-
08
Mar-08
Apr-0
8
May-0
8
Jun-
08Ju
l-08
Aug-0
8
Sep-
08
Oct-08
Nov-0
8
Dec-0
8
Jan-0
9
Feb-
09
Mar-09
Apr-0
9
May-0
9
Jun-
09Ju
l-09
Aug-0
9
Source : mongabay.com using World Bank Commodity Price data
Karnataka
AndhraPradesh
Tamil Nadu
Punjab
Assam Nagaland
Orissa
Gujrat Madhya Pradesh
Maharashtra
Uttaranchal
RajasthanUtter
Pradesh
Haryana
Goa
Kerala
Chhattisgarh
WestBengal
Bihar
INDIATotal Numbers of Sugar Mills - 650
Total Sugar Production - 14.7 million tonnes
13 Annual Report 2008-09 DIRECTORS’ REPORT
Source: CMIE, KSBL Research.
In order to augment the supply and availability of sugar, the
Government has announced several measures like duty-free import
of raw sugar, permission to some state enterprises to import duty-
free white sugar to the extent of 1 million tonnes and imposition
of stock limits for dealers to check the hoarding and ban of sugar
futures, in the recent past.
Such measures and higher sugar release under the release
mechanism by the Government have kept sugar prices under
control for a short span. However, considering the strong
fundamentals of the up move in the current sugar cycle (backed
by a steep deficit), the uptrend in sugar prices is likely to continue
for some time now. The higher global prices will ensure that the
domestic price of sugar remains on a strong footing.
Cane Pricing
Sugar mills in India pay cane price either based on the Statutory
Minimum Price (SMP) announced by the Central Government or
the State Advised Price (SAP) announced by the State Government
where a SAP regime is in place with the SAP usually being higher
than SMP. Mills in India’s largest cane producing state [Uttar
Pradesh (UP)] pay cane price to farmers according to SAP.
Historically, SAP has been significantly higher (20%-50%) than
SMP and northern Indian mills had paid cane price of Rs. 140
per quintal. The Mills in Maharashtra, Karnataka and Tamil Nadu
consider SMP or an agreed price as in the case of Bihar.
UP Cane Pricing Predicament
The UP sugar industry as a whole has been exposed to increases
in cane prices. Historically, the State Government has been fixing
cane price irrespective of the price of sugar. The industry is
contesting in the court of law, the arbitrary fixing of the cane
price and demanding a methodology of cane pricing based on the
price of sugar. The outcome of this case is still awaited.
Sugar, for historical reasons, carries a very strong weightage in the
Wholesale Price Index. Hence, the Government keenly monitors its
price movement. In India, sugar is a strong political commodity
since cane farming is the means of livelihood for a big mass of population in states such as Maharashtra and UP. In both these states sugar farmers operate through co-operative societies and wield significant influence over local politics. Thus, while, on the one hand, the Government tries its best to check rise in sugar prices, on the other hand, the SAP is normally increased irrespective of the sugar mills’ capacity to pay for cane.
Declining Stock/Consumption Ratio Of Sugar
The Stock/Consumption Ratio refers to the percentage of stock of sugar held at the end of a given year in respect to the amount of sugar consumed during the year. A declining Stock/Consumption Ratio strengthens the sugar prices considerably. This fact can be observed from the following table -
Declining Production And Stocks Of Sugar
With the production declining and the consumption rising steadily, the stock of sugar at year end has been declining notwithstanding the fact that the Government has been importing raw sugarcane for inducing higher production. This has been steadily transforming into declining Stock/Consumption Ratio and thus steadily rising prices. As such prices are likely to remain on the higher side in the coming sugar year.
Correlation between sugar price and stock/consumption
8065.4 66.7 70.9
45.8
24.919.5
2,0001,9001,8001,7001,6001,5001,4001,3001,2001,1001,000
7060
50403020100
SY00
-01
SY01
-02
Source : Sharekhan Research
SY02
-03
SY03
-04
SY04
-05
SY05
-06
SY06
-07
SY07
-08
stock/consumption % (LHS) sugar price (Rs per quintal) (RHS)
46.340.6
Apr-03
2400
2200
2000
1800
1600
1400
1200
1000Jan-04 Oct-04 Jul-05 Apr-06 Jan-07 Oct-07 Jul-08 Apr-09
Domestic sugar prices
The Oudh Sugar Mills Limited14
Source: Sharekhan
The Levy Sugar
The obligation placed by the Government on the sugar industry
to supply 10% of its output as levy sugar at prices far below
the actual cost of production and the open market prices. The
levy sugar is distributed through the Public Distribution System
channel to the B.P.L. population. Thus, while the sugar industry is
forced to supply levy sugar, there is hardly any realization among
the public that the subsidy on levy sugar is funded by the industry
and not by the Government. Unfortunately, the public distribution
system is highly inefficient where substantial leakages occur and
the sugar supplied by the industry ends up in the free maket where
prices are normallly higher. The Government is looking to revamp
this entire system.
Anticipating Tight Sugar Supply
India plays a crucial role in the world’s sugar output. According
to a US Governmental report, world sugar output may probably
dip by 6.37 % in the Sugar season 2008-09 on the back of lower
production in major sugarcane producing countries including
India and spurt in the demand.
Indian Sugar output in the current sugar year 2008-09 has
plummeted substantially as compared with the output in the
previous few years. Current year’s estimate is now placed at around
14.75 million tonnes, 44% lower than the output achieved in the
previous year 2007-08 at 26.3 million tonnes. Such a sharp decline
in sugar production by 11.55 million tonnes in one single year
is unprecedented. This has happened mainly because the farmers
seem to have lost interest in sugarcane planting in recent past
due to lack of orderly disposal thereof in addition to the fact that
there has been ambiguity regarding cane pricing and large dues by
the industry to the farmers.
The season 2009-10 plantation has been poor due to the non-
availability of sugarcane seed due to the sharp surge in sugarcane
prices at the fag end of the season 2008-09. The yields are also
likely to be affected due to less than normal rainfall in most of the
sugarcane growing belt. Some of the districts producing cane have
been declared drought hit. Indian sugar industry suffers from too
many interventions by the authorities. Such interventions, lead
to wide variations in sugar production. Domestic demand on the
other hand is pegged at an increased level of 22.0 million tonnes.
The country has contracted to import around 4 million tonnes of
raw sugar.
The Indian sugar industry expects the Government to extend its
duty-free raw sugar import policy by one more year to encourage
overseas purchases and curb domestic prices in the year of tight
supplies. The Government, earlier this year, removed the export
obligation that was linked to the import of raw sugar, as tight
supplies threatened to push up prices, stoking inflation.
The Fuel Ethanol
Ethanol fuel is available as a by-product of sugar mills producing
sugar. It can be used as a fuel, mainly as a bio-fuel alternative to
gasoline, and is widely used in cars in Brazil and as an oxygenate to
gasoline in the United States. It is steadily becoming a promising
alternative to gasoline throughout the world and thus instead of
sugar may be produced as a primary product out of sugarcane
processing.
Brazil is the world’s second largest producer of ethanol fuel and
the world’s largest exporter. Together, Brazil and the United
States lead the industrial production of ethanol fuel, accounting
together for 89% of the world’s production in 2008. In 2008 Brazil
Sugar Year (Oct - Sep) 2000-01 2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09E 2009-10E 2010-11EOpening stock 9.3 10.6 11.2 12.4 8.2 4.6 3.7 9.5 8.9 2.5 2.0Production 18.5 18.5 20.1 13.5 12.7 19.3 28.0 26.3 14.5 19.0 25.0% chg 0.0 8.6 -32.8 -5.9 52.0 45.1 -6.1 -44.9 31.0 31.6Imports 0 0 0 0.4 2.1 0 0 0 2 4 0Total availability 27.8 29.1 31.3 26.3 23 23.9 31.7 35.8 25.4 25.5 27
Domestic consumption 16.2 16.8 17.5 17.9 18.5 19.0 20.5 21.9 22.8 23.5 24.3% chg 3.7 4.2 2.3 3.4 2.7 7.9 6.8 4.1 3.1 3.4Exports 1.0 1.1 1.5 0.2 0 1.1 1.7 5.0 0.1 0 0Total offtake 17.2 17.9 19 18.1 18.5 20.1 22.2 26.9 22.9 23.5 24.3Closing stock 10.6 11.2 12.4 8.2 4.6 3.7 9.5 8.9 2.5 2 2.7Stock/Domesticconsumption (%)
65.4 66.7 70.9 45.8 24.9 19.5 46.3 40.6 11.0 8.5 11.1
Stock as no. of months of consumption
7.9 8.0 8.5 5.5 3.0 2.3 5.6 4.9 1.3 1.0 1.3
India’s Sugar Scenario (million tonne)
15 Annual Report 2008-09 DIRECTORS’ REPORT
produced 24.5 billion litres (6.47 billion U.S. liquid gallons), which represents 37.3% of the world’s total ethanol used as fuel.
India has initiated the use of ethanol as an automotive fuel. In fact, 5% blending is already underway with oil companies inviting tenders
from the sugar industry for supply of ethanol. 5% blending has been a grand success. The Government of India had approved a 10 %
ethanol blend with gasoline for mandatory use in vehicles from October, 2008.
However, the ethanol blending programme has suffered a setback due to the sharp fall in sugarcane production in the country. Fall in
sugarcane production has also resulted in a sharp fall in the production of molasses a by-product of sugarcane and the raw material
for ethanol. Consequently, a tight supply of molasses has sent its prices soaring resulting in the non-viability of ethanol and industrial
alcohols production. Global prices have not risen resulting in large scale imports of industrial alcohol into India.
The quantitative figures of production and recovery of the Company’s Distilleries are as under:
Year 2008-09 (Full year ended 30th June, 2009) Year 2007-08 (Full year ended 30th June, 2008)
Hargaon Narkatiaganj Total Hargaon Narkatiaganj Total
Alcohol Produced
(Lakh quintals)
131.33 102.15 233.48 165.47 80.02 245.49
Average Recovery (%) 21.03 23.02 22.37 23.48
The Green Power/Co-Gen Capability Of Sugar
The sugar industry can make a significant contribution in meeting the national power requirements. Sugar mills in India produce 2,000
megawatt of biomass-based energy every year, as much as windmills produce, and at half the cost, a new study has found. Sugar mills,
which produce both electricity and heat through co-generation, are already selling power to the grid and can produce up to 5,100 MW
- 69 % of the country’s total co-generation capacity [according to the study carried out by the New Delhi-based NGO Centre for Science
and Environment (CSE)]. If the resources and technology are improved, co-generation can produce almost 10,000 MW or 40 % of the
country’s 2008 power deficit. Such alternatives to fossil fuel energy are critical for India’s energy and climate security.
Sugar mills generate biomass-based ‘green’ energy from bagasse, a by-product that comes from cane crushing. Mills in five major cane
growing states of Andhra Pradesh, Karnataka, Maharashtra, Tamil Nadu and UP are generating enough bagasse to meet the energy needs
of a business centre of the size of Gurgaon.
However, India has no policy framework in place to strengthen this green energy source. Today, out of the 650 odd sugar mills in India,
107 have co-generation plants. This revenue stream has managed to provide a much needed cash flow support at times of low sugar
prices.
Bagasse-based co-generation plants also earn carbon credits as the carbon dioxide absorbed by sugarcane plants while growing up is
more than the carbon dioxide produced in burning bagasse. India launched its biomass power (bagasse-based co-generation) policy in
1990. As the shortage of power grew in many sugarcane states, the policy was revised in 2006 to provide capital subsidy and tax rebates.
The 2003 Amendment to the Electricity Act also provided the necessary framework for promoting renewable energy sources-asking states
to fix a minimum limit for energy utilities to buy green energy.
Like molasses the production of bagasse has also been seriously curtailed due to shortage of sugarcane. Soaring bagasse prices and lack
of availability has also reduced the production of energy during the season 2008-09. This trend is likely to continue during 2009-10.
The Company has co-generation power plants at Hargaon and Narkatiaganj. The sale of power to State Grid by the company is as follows:
Year 2008-09 (Full year ended 30th June, 2009) Year ended 2007-08 (Full year ended 30th June, 2008)
Hargaon Narkatiaganj Total Hargaon Narkatiaganj Total
Power Sale (Lakh units) 155.65 36.33 191.98 201.63 44.30 245.92
The Oudh Sugar Mills Limited16
COMPANY OVERVIEW
Operating Performance Review
Oudh Sugar Mills performed well during 2008-09 backed by strong demand, better recovery, better cost management and operational
efficiencies. Higher sales price coupled with higher liquidation of stocks in hand have led to the topline growth inspite of lower production
during the year.
The Comparative Operational Figures of the Sugar Factories for the Last Two Seasons:
Season 2008-09 (Actual) Season 2007-08 (Actual)
Hargaon Rosa Narka-
tiaganj
Hata Total Hargaon Rosa Narka-
tiaganj
Hata Total
Sugarcane Crushed
(Lakh quintals)
71.67 29.55 45.16 1.45 147.83 122.05 45.61 69.39 -- 237.05
Recovery (%) 9.34 8.59 9.02 8.00 10.59 9.85 8.83 --
Sugar Produced
(Lakh quintals)
6.69 2.54 4.07 0.12 13.42 12.93 4.49 6.12 -- 23.54
Crushing days 102 86 73 11 272 136 115 116 -- 367
Financial Performance Review
The Company’s total turnover increased by 64.74% to Rs. 58,309.13 lakhs during the year 2008-09 as compared to Rs. 35,393.59 lakhs
during the year 2007-08. The Company was able to earn profit during the year 2008-09 after 2 years of losses suffered during the years
2006-07 and 2007-08. The net profits for the year stood at Rs. 1,917.38 lakhs as against a net loss of Rs. 451.27 lakhs in 2007-08. The
Net Worth of the Company rose by 36.56% to be placed at Rs. 13,770.06 lakhs as on 30th June , 2009 as against Rs. 10,083.42 lakhs as
on 30th June, 2008.
Segmental break-up of Revenue
14%
2%
6%
78%
9%1%
5%
85%
2008-09Sugar 47,537.70Spirits 5,017.13Co-generation 587.06Food processing 2,507.44
2007-08Sugar 25,839.51Spirits 4,677.10Co-generation 725.57Food processing 1,913.72
Sugar Co-generation
Spirits Food processing
Sugar Co-generation
Spirits Food processing
17 Annual Report 2008-09 DIRECTORS’ REPORT
Internal Control System
The Company has a sound and robust system of internal control for financial reporting of various transactions, efficiency of operations
and compliance with relevant laws and regulations. The controls span over all the functions and departments of the organisation. The
internal control system is adequate and commensurate with the size of the Company and the nature of its business.
Human Resources And Industrial Relations
Employee strength as on 30th June, 2009 was 1916 employees as against1926 as on 30th June, 2008.
Except a change in the office of the Company Secretary there has been no material change in the senior management team of the
Company. The Company’s HR Policy continues to be based on inspiring and unleashing creative potential in human assets of the Company.
This is possible in an environment where we respect the rights of all those around us. In this direction, we endeavor:
1) To treat individuals in all aspects of employment solely on the basis of their ability irrespective of race, caste, creed, religion, age,
disability, gender, sexual orientation or marital status.
2) Not to tolerate racial, sexual or any other kind of harassment.
The Company had cordial industrial relations in all the Mills and offices during the year under review.
Risks and Concerns Review
Michael Porter Analysis
PotentialEntrants
Suppliers
Substitutes
Buyers
IndustryCompetitorsBargaining Power
of Suppliers
Threat ofNew Entrants
Threat ofSubstitute Products or Service
Bargaining Power
of BuyersRivalry amongexisting Firms
The Oudh Sugar Mills Limited18
Threat Of New Entrants
The sugar industry in India already has a number of players with a strong foothold. Presently there is shortage of sugarcane production in India. As such there is high competition for procurement of the same. This acts as a deterrent for new entrants into the industry.Low to Medium
Rivalry Among Existing Firms
There are some 650 mills located all across India. Oudh Sugar Mills is not yet among the large players in the industry. Large scale businesses have operational advantages as against the smaller players. However, the Company has taken a number of steps that put its operational efficiencies at par with the larger players.Medium to High
Bargaining Power Of Buyers
The demand for sugar has been increasing regularly and is also expected to rise further in the future. The release of sugar into the market is regulated directly by the Government. As such the bargaining power of buyers is limited to a very certain extent.Low to Medium
Threat Of Substitute Products
Increase in demand for substitute products could negatively affect the Company’s business. However, the primary substitutes for sugar-gur and khandsari do not have a large and strong market and as such do not act as a big threat to sugar companies.Low
Bargaining Power Of Suppliers
The sugar industry has typical cyclicality in operations. At a time when there is shortage of sugarcane production due to cyclical factors, the bargaining power of buyers rise considerably and vice-versa.Medium
Other Risks And Concerns
Industry Risk
Global economic downturn might negatively affect the sugar industry.
Risk Mitigation
Demand for sugar not impacted by a great deal due to economic slowdowns. Even during a year in which the global economy was largely affected, the demand for sugar was robust and is expected to continue to be so.
Raw Material Risk
Cane is the main raw material for a sugar mill. The area under cane cultivation is expected to have come down during sugar year 2008-09 as compared to sugar year 2007-08. As a result production of sugarcane has fallen. In addition to this, unfavorable climatic
conditions also negatively impact productivity.
Risk Mitigation
The Government is importing large amount of raw sugar from
abroad to meet the industry requirement. The Company has
taken measures to ensure harmonious relationships with cane
growers to ensure that the Company’s mills do not fall short of
its requirements.
Regulatory Risk
Sugar industry is regulated by both Central as well as State
Governments. The input prices are regulated by both Central
and State Governments. The release mechanism used by Central
Government to regulate outputs has an impact on sugar prices.
In addition to these, levy sugar, i.e. 10% of the total output is
required to be sold at prices far below the market prices.
Risk Mitigation
The Government is considering deregulating the sector as much
as possible. Over the years, the levy sugar has been brought down
to 10% of output. Government has also taken steps to provide
export incentives and other measures to reduce problems faced
by sugar mills.
Business Concentration Risk
Sugar being a cyclical commodity, may pose a threat to the
Company’s financial and operational performance if it is largely
dependent on sugar business.
Risk Mitigation
To reduce this concentration risk, the Company is diversifying its
business to various other segments like ethanol, co-generation
and canning segments.
FORWARD LOOKING STATEMENTSThis report contains forward-looking statements, which may
be identified by their use of words like ‘plans’, ‘expects’, ‘will’,
‘anticipates’, ‘believes’, ‘intends’, ‘projects’, ‘estimates’ or other
words of similar meaning. All statements that address expectations
or projections about the future, including but not limited to
statements about the Company’s strategy for growth, product
development, market position, expenditures, and financial results,
are forward-looking statements. Forward-looking statements are
based on certain assumptions and expectations of future events.
The Company cannot guarantee that these assumptions and
expectations are accurate or will be realised.
The Company’s actual results, performance or achievements could
thus differ materially from those projected in any such forward-
looking statements. The Company assumes no responsibility to
publicly amend, modify or revise any forward looking statements,
on the basis of any subsequent developments, information or
events.
19 Annual Report 2008-09 DIRECTORS’ REPORT
Statement showing particulars pursuant to the Companies (Disclosure of particulars in the Report of the Board of Directors) Rules, 1988 and forming part of the Directors’ Report for the year ended 30th June, 2009.
I. CONSERVATION OF ENERGYa. Energy conservation measures taken
Following initiatives have been taken by the Company to conserve Energy during the year 2008-2009.
To save the energy which is in the form of steam and electricity, energy saving systems have been installed at Company’s various units. For this, new technology has been adopted and following major equipments have been installed :i) Condensates Flash Recovery Equipment named Cigar;ii) Direct Contact Juice Heater;iii) Direct Contact Molasses Conditioner;iv) Sugar Melter of new design working at a very low temperature vapour;
v) Conversion of Evaporator System from Quad to Quintuple;vi) Continuous Pan at B & C Boiler;vii) Latest High Capacity Batch Type Flat Bottom Machines;viii) Replacement of old low efficiency boiler with high efficiency boiler with 120 ton capacity per hour;ix) Installation of high efficiency 15 MW Power Turbine;
b. Additional investments and proposals, if any, being implemented for reduction of consumption of energy
There has been no additional investment during the year under review nor is there any capital expenditure plan for purchase of capital equipments aimed at reduction of consumption of energy.
c. Impact of the measures at I and II above on the reduction of energy consumption and consequent impact on the cost of production of goods
In spite of the energy conservation measures enumerated in I and II above there has been a spurt in power and fuel expenses in absolute terms for the following, amongst other reasons :-
i) A new boiler of 30 MT had to run additionally at Hargaon unit to feed constant power to its distillery.ii) Lower crushing of cane in all the units due to scarcity of sugarcane has resulted in lesser availability of bagasse which in turn
lead to comparatively more consumption of high speed diesel and purchase of power from the concerned State Electricity Boards.
d. Total energy consumption and energy consumption per unit of production
(A) Power & Fuel Consumption :
Current Year Previous Year
Sugar FoodProcessing
Sugar FoodProcessing
1. Electricity :a) Purchased : Units (in lakhs) 14.43 1.75 4.60 1.38 Total amount (Rs. in lakhs) 93.17 10.33 21.74 7.73 Rate/Unit(Rs.) 6.46 5.91 4.73 5.61b) Own Generation :i) Through Diesel Generator : Units (in lakhs) 23.62 0.87 18.89 0.98 Units/litre of diesel-oil 3.31 12.10 4.39 10.23 Cost/Unit (Rs.) 10.25 3.07 7.19 3.57ii) Through Steam Turbine/ Generator :
Units (in lakhs) (Excluding units sold to and used in other
segment
471.29 -- 680.55 --
Units/litre of fuel oil/gas Not ascertainable as the bagasse which is a
by-product is being used as fuelCost/Unit (Rs.)
ANNEXURE - B
The Oudh Sugar Mills Limited20
Current Year Previous Year
Sugar FoodProcessing
Sugar FoodProcessing
2. Coal :
Quantity (Tonnes) -- 1,183.00 -- 861.10
Total Cost (Rs. in lakhs) -- 62.82 -- 45.89
Average Rate (Rs.) -- 5,309.94 -- 5,329.36
(B) Consumption per unit of production :
Products Sugar - (in lakhs Qtls)/Food Processing (in Qtls) 14.12 0.40 23.54 0.42
Electricity (unit) 36.07 6.60 29.71 5.61
Coal (in kg) -- 0.30 -- 0.20
II. RESEARCH & DEVELOPMENT AND TECHNOLOGY ADOPTION
AND INNOVATION
a. Research & Development
Though the Company being an agro based manufacturing
organisation is not engaged in any substantial research and
development activities, it continues its efforts to improve
the quality and efficiency of its operations and for that
purpose has taken following initiatives towards research and
development :
i) The existing boilers are endeavored to run with coal
after suitable design modifications so as to overcome
the deficiency of baggase fuel availability;
ii) The soil testing laboratory is planned to be in full
stream during the current financial year to educate the
farmers as regards different varieties of manures to be
used to increase the productivity of the soil, increase
the farm output and sucrose contents of the crop.
iii) In order to maintain the genetic purity of different
varieties of sugarcane, improve the quality and yield of
sugar, seeds are treated with moist heat air.
iv) Ways and means are being adopted to control
onslaught of insects and other damaging creatures,
different varieties of insecticides and pesticides are
being developed.
v) The growth of parasites and borers is controlled
through various biological controls of new and
improved nature.
vi) Ratoon management is done on scientific basis only to
increase the yield of sugarcane crop.
vii) The expenditure so far incurred in research and
development is Rs. 331.01 lakhs.
b. Technology Adoption and Innovation
1. The Company has not imported any technology during
the year under review. Nonetheless the following
efforts have been made towards absorption of
indigenous technology, its adoption and innovation of
newer and improved means of crop management and
plant efficiency:-
• installation of additional converter and boilers in the
mills;
• installation of heat and moist absorption mechanism in
the mills ;
• technological changes and advancement at various
stages of plant management and to educate the
farmers to increase their yield and sucrose contents of
sugarcane.
2. Benefits derived as a result of above efforts :
• energy efficiency mechanism;
• reduction in green house gas emission effect;
• marginal increase in production capacity and
productivity;
• increase in the crop yield
• improvement in genetic purity of the sugarcane.
21 Annual Report 2008-09 DIRECTORS’ REPORT
III. FOREIGN EXCHANGE EARNINGS AND OUTGO:
a) Activities relating to exports, initiatives taken to increase exports
During the year under review the Company has not made any direct export of sugar. As and when there is an export obligation the same is discharged through chanalised agencies. As regards export of canned fruits, jam and jelly through Allahabad Canning Co., a Division of the Company, the same is managed through correspondence and personnel contacts with overseas buyers. The total export of Rs. 305 lakhs during the year 2007-08 has been increased to Rs. 680 lakhs (CIF value) during the year 2008-09. The size of the order book position as on the date of this report is Rs. 630 lakhs supported by established L/Cs in favour of the Company and to be executed during the current year 2009-10.
b) Development of new export markets for products and services and export plan
c) Earnings in Foreign Exchange - Rs. 633.34 lakhs (FOB value)
d) Expenditure in Foreign Currency - Rs. 17.71 lakhs
Name DesignationRemuneration
(Rs.)Nature of
Duties Qualification
Experience (years)
Age (years)Year of
commencement of employment
Last employment
held
Employed throughout the year :
Mr. Chadra Shekhar Nopany
Managing Director
1,02,88,640
Overall management of
the affairs of the Company
B. Com., A.C.A., M.S.I.A.
19 43 1995 None
Mr. Chandra Mohan Executive President,
Narkatiaganj28,56,000
Overall management
of the affairs of the
Company’s unit, Narkatiaganj
Diploma in Mechanical Engineering
28 49 May, 2007Bajaj Hindustan Ltd., Sharanpur
Mr. V.P. SinghTechnical
Advisor27,22,260
Overall incharge of
Technical Affairs of the
Company
Diploma in Mechanical Engineering
39 59 June, 2004
The Dhampur Sugar Mills
Ltd., Executive President
PARTICULARS OF EMPLOYEES AS REQUIRED UNDER SECTION 217(2A) OF THE COMPANIES ACT, 1956
AND FORMING PART OF THE DIRECTORS’ REPORT FOR THE YEAR ENDED 30TH JUNE, 2009
Notes : 1. The remuneration includes salary, Company’s contribution to provident fund and perquisite value of rent paid.
2. The appointment is contractual.
3. Other terms and conditions are as per rules of the Company. For and on behalf of the Board
Place : Mumbai Chandra Shekhar Nopany
Dated, 25th August, 2009 Chairman-cum-Managing Director
ANNEXURE - C
The Oudh Sugar Mills Limited22
STATEMENT PURSUANT TO SECTION 212 OF THE COMPANIES ACT, 1956
The entire subscribed equity capital of Champaran Marketing Company Limited, Hargaon Investment & Trading Company Limited and
OSM Investment & Trading Company Limited as on 31st March, 2009 was held by the Company. As on 31st March, 2009, 55.56% and
44.44% of the subscribed equity capital of Hargaon Properties Limited was held by Hargaon Investment & Trading Company Limited and
Champaran Marketing Company Limited respectively, wholly owned subsidiaries of the Company and accordingly the said company is the
stepped down subsidiary of the Company.
(Rs. In lakhs)
Name of the Subsidiary Company
Net aggregate of subsidiaries’ profit/(loss)
not dealt with in Holding Company’s Accounts
Net aggregate of subsidiaries’ profit/(loss)
dealt with in Holding Company’s Accounts
Current year
Upto Previous year since became
subsidiary
Current year
Upto Previous year since became
subsidiary
Champaran Marketing Company Limited 10.10 301.45 -- 43.41
OSM Investment & Trading Company Limited 10.65 248.45 -- 26.06
Hargaon Investment & Trading Company Limited 22.51 763.39 -- 57.22
Hargaon Properties Limited (0.23) 2.60 -- --
Since the close of the accounts of Champaran Marketing Company Limited, Hargaon Investment & Trading Company Limited, OSM
Investment & Trading Company Limited and Hargaon Properties Limited on 31st March, 2009, no change has taken place in the holding
Company’s interest in the said subsidiary Companies nor has any material change taken place in subsidiary Companies in regard to any
of the matters specified in Section 212(5)(b) of the Companies Act, 1956 except that the monies lent by Champaran Marketing Company
Limited increased by Rs. 50,000 and monies lent by OSM Investment & Trading company Limited decreased by Rs.25,000.
Chandra Shekhar Nopany Chairman-cum-Managing Director
A.C. Dalal Director
G.N. Pareek Company Secretary
ANNEXURE - D
Annual Report 2008-09 DIRECTORS’ REPORT 23
REPORT ON CORPORATE GOVERNANCE
1. COMPANY’S PHILOSOPHY
The Company continues to believe that Corporate governance
is not a destination, it is a journey and the business situation
is very dynamic. The corporate governance in this way shall
usher in an era of enhancement of intrinsic strength of
the organization as also its stake holders. Accordingly, the
Company is vigilant and applies supervisory mechanism
to ensure that the senior management of the Company
complies with the standards of disclosure, transparency
and accountability. The overall philosophy of the Company
towards corporate governance is one of shared responsibility.
Each one in the Company is expected to ensure professional
and ethical management of the Company.
2. BOARD OF DIRECTORS
i) The Board is headed by Mr. Chandra Shekhar Nopany,
Chairman-cum-Managing Director and is composed
of eminent persons with considerable professional
experience in various corporate fields. The present
strength of the Board of Directors is eight, of which
seven are Non-executive Directors and one Managing
Director. Except Mr. S. V. Muzumdar who is holding
1050 (0.01%) Equity Shares, no other Non-executive
Director is holding any Equity Share of the Company.
ii) None of the Directors on the Board is a Member of
more than 10 Committees or Chairman of more than
5 Committees across all the companies in which he or
she is a Director.
iii) With a view to institutionalize all corporate affairs and
set up values, systems, standards and procedures for
advance planning for matters requiring discussions/
decisions by the Board, the Company has defined
guidelines for the meetings of the Board of Directors
and Committees thereof. These guidelines seek to
systematize the decision making process at the
meetings of the Board/Committees in an informed and
most efficient manner.
iv) The Company holds minimum of four Board Meetings
in each year.
v) All divisions/departments in the Company are
encouraged to plan their functions well in advance,
particularly with regard to matters requiring
discussions/approval/ decision in the Board/Committee
Meetings. All such matters are communicated to the
Company Secretary in advance so that the same could
be included in the Agenda for the Board Meetings.
vi) The Chairman-cum-Managing Director and the
Company Secretary in consultation with other
concerned persons in the senior management, finalise
the agenda papers for the Board Meetings.
vii) Agenda papers are circulated to the Directors
sufficiently in advance. All material information is
incorporated in the Agenda papers for facilitating
meaningful and focused discussions at the meeting.
Where it is not practicable to attach any document to
the Agenda, the same are placed on the table at the
meeting with specific reference to this effect in the
Agenda.
viii) In special and exceptional circumstances, additional or
supplementary item(s) on the agenda are permitted.
Sensitive subject matters may be discussed at the
meeting without written material being circulated in
advance or at the meeting.
Nine Board Meetings were held during the year under
review .Board Meetings were held on17th July, 2008,
26th August, 2008, 23rd October, 2008, 25th November,
2008, 29th December, 2008, 23rd January, 2009, 30th
March, 2009, 20th April, 2009 and 23rd June, 2009
to deliberate on various matters. The composition of
the Board of Directors and their attendance at the
Board Meetings during the year and at the last Annual
General Meeting as also the number of directorships in
Indian public limited companies are as follows:
ANNEXURE - E
The Oudh Sugar Mills Limited24
Name of Director Attendance at
last AGM
No. of Board
meetings
attended
Category of
Director
Directorships No. of Chairmanship/ Membership
of Board Committees
Chairman Member
Mr. Chandra Shekhar
Nopany
Yes 5 MD 12 2 2
Mr. S. V. Muzumdar No 7 I/NED 5 2 5
Mr. Ashvin C. Dalal No 9 I/NED 1 1 -
Mr. C. B. Patodia Yes 2 I/NED 1 - 1
Mr. Rohit Kumar Dhoot No 6 I/NED 7 - 2
Mrs. Madhu Vadera
Jayakumar
No 7 I/NED 1 - 1
Mr. Haigreve Khaitan No 2 NED 15 - 8
Mr. J. N. Godbole No 8 I/NED 12 2 7
MD - Managing Director I - Independent
NED - Non-executive Director
3. AUDIT COMMITTEE
The Audit Committee of the Company is constituted in line
with the provisions of Clause 49 of the Listing Agreement
with the Stock Exchanges read with Section 292A of the
Companies Act, 1956.
a) Terms of Reference
The terms of reference of the Audit Committee are
broadly as under:
• Overview of the Company’s financial reporting process
and the disclosure of its financial information to ensure
that the financial statements reflect a true and fair
position and that sufficient and credible information
is disclosed.
• Recommending the appointment and removal of
statutory auditors, fixation of audit fee and also
approval for payment for any other services.
• Discussion with statutory auditors before the audit
commences of the nature and scope of audit as well
as post-audit discussion to ascertain any area of
concern.
• Reviewing the financial statements and draft audit
report, including quarterly/half yearly financial
information.
• Reviewing with management the annual financial
statements before submission to the Board, focusing
primarily on :
i. any changes in accounting policies and practices;
ii. major accounting entries based on exercise of judgment
by management;
In accordance with Clause 49 of the Listing Agreement with the Stock Exchanges, membership/chairmanship of only the Audit Committee
and Shareholders’/Investors’ Grievance Committee of all the public limited companies has been considered in the aforesaid chart.
Annual Report 2008-09 REPORT ON CORPORATE GOVERNANCE 25
iii. qualifications in draft audit report;
iv. significant adjustments arising out of audit;
v. the going concern assumption;
vi. compliance with accounting standards;
vii. compliance with stock exchange and legal requirements
concerning financial statements;
viii. any related party transactions as per Accounting
Standard 18.
• Reviewing the Company’s financial and risk management
policies.
• Reviewing with the management, external and internal
auditors, the adequacy of internal control systems.
• Reviewing the adequacy of internal audit function, including
structure of the internal audit department, approval of
the audit plan and its execution, staffing and seniority of
the official heading the department, reporting structure,
coverage and frequency of internal audit.
• Discussion with internal auditors of any significant findings
and follow-up thereon.
• Reviewing the findings of any internal investigations by the
internal auditors into matters where there is suspected fraud
or irregularity or a failure of internal control systems of a
material nature and reporting the matter to the Board.
• Looking into the reasons for substantial defaults in payments
to the depositors, debenture holders, shareholders (in case of
non-payment of declared dividends) and creditors.
b) Composition
The Audit Committee comprises of four Independent Non-
executive Directors viz. Mr. Ashvin C. Dalal, Mr. C. B. Patodia,
Mr. S. V. Muzumdar and Mr. Rohit Kumar Dhoot. The
Committee met four times during the year on 26th August,
2008, 23rd October, 2008, 23rd January, 2009, and 20th
April, 2009. Attendance of the members at the meetings was
as under :
Name of the Member Status No. of meetings
attended
Mr. Ashvin C. Dalal Chairman 4
Mr. C. B. Patodia Member 2
Mr. S. V. Muzumdar Member 2
Mr. Rohit Kumar Dhoot Member 2
The Secretary of the Company who is also acting as
Secretary of the Audit Committee attends the meetings.
At the invitation of the Committee, the Internal Auditors,
Statutory Auditors and Cost Auditors also attend the Audit
Committee Meetings to answer and clarify the queries raised
at the Meetings.
4. REMUNERATION COMMITTEE
i) Though the constitution of the Remuneration
Committee is not mandatory, the Company has
constituted the Remuneration Committee during the
year 2002-2003.
ii) The broad terms of reference of the Remuneration
Committee are as under:
a. To approve the remuneration and commission payable
to the Directors.
b. Such other matters as the Board may from time to time
request the Remuneration Committee to examine and
recommend / approve.
iii) The Committee, presently, comprises of three
Independent Non-executive Directors, viz. Mr. S.V.
Muzumdar, Mr. Ashvin C. Dalal and Mr. Rohit Kumar
Dhoot. The Secretary of the Company is also acting as
Secretary of the Remuneration Committee. A meeting
of the Remuneration Committee was held on 25th
August, 2008. Attendance of the members at the
meeting was as under:
Name of the Member Status No. of
meetings
attended
Mr. S. V. Muzumdar Chairman 1
Mr. Ashvin C. Dalal Member 1
Mr. Rohit Kumar Dhoot Member --
iv) Remuneration Policy
Remuneration of employees broadly consists of
base remuneration, perquisites, bonus, exgratia, etc.
The components of the total remuneration vary for
different cadres and are governed by industry pattern,
qualifications and experience of the employee,
responsibilities entrusted to and handled by him,
individual performance, etc.
The objectives of the remuneration policy are to
motivate employees to excel in their performance,
The Oudh Sugar Mills Limited26
recognise their contribution, retain talent in the
organisation and reward merits.
v) Remuneration of Directors
Details of remuneration paid to Directors for the year
2008-09.
a) Executive Director
Managing
Director
Salary
Rs.
Perquisites
Rs.
Retirement
benefits Rs.
Mr. C.S.
Nopany
39,00,000 59,20,640 4,68,000
Mr. C.S. Nopany’s remuneration package includes
salary, free furnished accommodation with all expenses
for upkeep and maintenance thereof, contribution to
Provident Fund, reimbursement of medical expenses,
leave travel concession, car with driver and telephone.
b) Non-executive Directors
The Company pays remuneration to its Non-executive
Directors by way of commission upto 1% of the net
profits for all directors put together with the maximum
ceiling of Rs. 1,00,000 per director. The Company pays a
fee Rs. 5,000 and Rs. 2,500 per meeting to each Director
for attending meetings of the Board of Directors
and Committees thereof respectively. The details
of sitting fee paid during the year 2008-09 are
as follows:
Sl. No. Name of the Director Gross Amount
(Rs.)
1 Mr. S. V. Muzumdar 47,500
2 Mr. Ashvin C. Dalal 65,000
3 Mr. C. B. Patodia 15,000
4 Mr. Rohit Kumar Dhoot 35,000
5 Mrs. Madhu Vadera
Jayakumar
40,000
6 Mr. Haigreve Khaitan 10,000
7 Mr. J. N. Godbole 40,000
5. INVESTORS’ GRIEVANCE COMMITTEE
The Committee, presently, comprises of three Non-executive
Directors viz. Mr. S. V. Muzumdar as Chairman and Mr.
Rohit Kumar Dhoot and Mrs. Madhu Vadera Jayakumar as
members. Mr. Govind Narayan Pareek, Company Secretary, is
the Compliance Officer of the Company for complying with
the requirements of the Listing Agreement with the Stock
Exchanges. No meeting of Investor Grievance Committee was held
during the period under review.
The Board of Directors have authorised the Company Secretary to
approve transfers/transmissions of upto 1000 shares. The transfers/
transmissions approved by the Company Secretary are periodically
placed before the Committee. The Committee deals with the
applications for transfer/ transmission of shares, subdivision and
consolidation of share certificates and issue of duplicate share
certificates, etc. The Committee also keeps a close watch on all
complaints/grievances of shareholders. During the year under
review the Company received 56 complaints/grievances from the
shareholders which were duly attended.
The average period of redressal of grievances is 7 days from the date
of receipt of letters/complaints. There was no unresolved complaint
as on 30th June, 2009. There was no share transfer application
pending for registration as on 30th June, 2009.
6. GENERAL BODY MEETINGS
The last three Annual General Meetings of the Company were held
as under :
Financial
Year
Date Time Location
2007-2008 18.12.2008 11.00 a.m. Registered Office:
Hargaon,
Dist. Sitapur, U. P.,
Pin-261 121.
2006-2007 17.12.2007 11.00 a.m. Registered Office:
Hargaon,
Dist. Sitapur, U. P.,
Pin-261 121.
2005-2006 06.11.2006 11.00 a.m. Registered Office:
Hargaon,
Dist. Sitapur, U. P.,
Pin-261 121.
Special resolution was passed at the Annual General Meeting
held on 18th December, 2008 for re-appointment of Mr. Chandra
Shekhar Nopany as the Managing Director for a further period of
three years with effect from 1st July, 2008. No special resolution
was passed at the Annual General Meeting held on 17th December,
2007 and a special resolution was passed at the Annual General
Meeting held on the 6th November, 2006 for issue of securities
through Public Issue, Rights Issue, Preferential Issue and/or Private
Placement, with or without an over-allotment option, equity shares
and/or equity shares through Global Depository Receipts (“GDRs”)
and/or American Depository Receipts (“ADRs”) and/or Foreign
27 Annual Report 2008-09 REPORT ON CORPORATE GOVERNANCE
Currency Convertible Bonds (“FCCBs”) and/or equity shares under
the Qualified Institutional Placement Guidelines (“QIPs”) and/or
any securities convertible into equity shares at the option of the
Company and/or holder(s) of the securities and/or securities linked
to equity shares and/or securities with warrants for an amount not
exceeding Rs.100 crores inclusive of such premium as may from
time to time be decided.
There was no occasion to pass special resolution through postal
ballot. Further, no such proposal is proposed to be placed for
the shareholders’ approval at the forthcoming Annual General
Meeting.
The last Annual General Meeting held on 18th December, 2008
was not attended by Mr. Ashvin C. Dalal, Chairman of the Audit
Committee due to sickness.
7. DISCLOSURES
i) There are no materially significant related party transactions
of the Company which have potential conflict with the
interest of the Company at large.
ii) No penalties or strictures have been imposed on the Company
by Stock Exchanges or SEBI or any statutory authority on any
matter related to capital markets for non-compliance by the
Company during the last three years.
8. MEANS OF COMMUNICATION
a) Since the quarterly and annual audited financial results of the
Company are sent to the Stock Exchanges immediately after
they are approved by the Board/Committee and posted on
Company’s website and also published in Business Standard,
Mumbai, The Pioneer, Kanpur, and Rashtriya Sahara, Lucknow
the same were not separately sent to each household of
shareholders.
b) The results are simultaneously uploaded on the website
at http://www.birla-sugar.com/osugar. Distribution of
shareholdings is also displayed on the website.
c) The quarterly results, annual financial results, annual report
& accounts and shareholding pattern are simultaneously
filed on the Electronic Data Information Filing and Retrieval
(EDIFAR) Website maintained by National Informatics Centre
in association with SEBI. The site can be accessed at http://
www.sebiedifar.nic.in.
d) No presentation was made to any Institutional Investor or to
any Analysts during the year.
9. GENERAL SHAREHOLDERS’ INFORMATION
a) 77th Annual General Meeting
Date : 26th November,2009
Time : 2.00 P.M
Venue : Registered Office:
Sugar Mills Complex, Hargaon, District – Sitapur
Uttar Pradesh – 261 121.
b) Tentative Financial Calendar
Audited Annual Results (2008-09) 25th August, 2009
Publication of Audited Results 26 th/27th August, 2009
Mailing of Annual Report October, 2009
First Quarter Results 28th October, 2009
Second Quarter Results End January, 2010
Third Quarter Results End April, 2010
Audited Annual Results (2009-10) August/September, 2010
c) Book Closure
The Register of the Members of the Company will remain
closed from 23rd October, 2009 to 24th October, 2009
both days inclusive for the purpose of payment of
dividend for the year ended 30th June, 2009 and from
24th November, 2009 to 25th November, 2009 both days
inclusive for the purpose of holding the Annual General
Meeting of the Company on 26th November, 2009.
d) Listing on Stock Exchanges and Stock codes
The names of the stock exchanges at which the Equity
Shares of the Company are listed and the respective
stock codes are as under:
Sl. No. Name of the Stock Exchange Stock code
1. Bombay Stock Exchange
Limited
507260
2. The National Stock Exchange
of India Limited
OUDHSUG
Under the depository system, International Securities
Identification Number (ISIN) allotted to the Equity
Shares of the Company is INE594A01014 and that for
Warrants is INE594A13019.
The Oudh Sugar Mills Limited28
e) Market Price Data
Monthly high/low of market price of the Company’s Equity Shares traded on Bombay Stock Exchange Limited and The National
Stock Exchange of India Limited during the last financial year was as under:
Month Bombay Stock Exchange Limited The National Stock Exchange of India LimitedHigh (Rs.) Low (Rs.) High (Rs.) Low (Rs.)
July, 2008 61.15 47.00 64.20 48.00August, 2008 72.90 54.90 72.00 53.15September, 2008 60.75 41.60 60.85 42.00October, 2008 47.00 25.85 47.10 25.35November, 2008 35.50 21.75 34.85 21.10December, 2008 33.60 22.10 34.15 20.30January, 2009 37.40 29.05 37.50 29.70February, 2009 38.00 31.25 38.00 31.10March, 2009 36.40 29.00 36.75 28.10April, 2009 52.45 34.55 52.70 32.10May, 2009 63.65 46.65 63.40 46.90June, 2009 67.95 54.40 68.95 54.25
f) Performance of Company’s Equity Shares in comparison to BSE Sensex and BSE 200
A graphical presentation of Indices vis-a-vis our share prices during July, 2008-June, 2009 is as follows:
July 0840.00
50.00
60.00
70.00
80.00
90.00
100.00
110.00
120.00
Aug 08 Sep 08 Oct 08
Months
Valu
es in
%
Nov 08 Dec 08 Jan 09 Feb 09 Mar 09 Apr 09 May 09 June 09
OSML BSE Sen BSE 200
g) Registrar & Share Transfer Agent
The Company has appointed Link Intime India Pvt. Ltd. as its Registrar & Share Transfer Agents (RTA) for handling work related
to share registry in terms of both physical and electronic modes. Accordingly, all correspondence, shares for transfer, demat/
remat requests and other communication in relation thereto should be mailed/hand delivered to the said RTA directly at the
following addresses:
Link Intime India Private Limited
(Formerly Intime Spectrum Registry Limited)
(Unit: The Oudh Sugar Mills Limited)
C-13, Pannalal Silk Mills Compound
L.B.S. Marg, Bhandup (West)
Mumbai - 400 078
Tel. No. : 91 - 022 – 2596 3838
Fax No. : 91 - 022 – 2594 6969
e-mail : [email protected]
Link Intime India Private Limited
(Formerly Intime Spectrum Registry Limited )
(Unit: The Oudh Sugar Mills Limited)
203, Daver House
197/199 D.N. Road
Mumbai - 400 001
Tel. No.: 91 - 022 – 2269 4127
29 Annual Report 2008-09 REPORT ON CORPORATE GOVERNANCE
j) Dematerialisation of Shares and Liquidity
The Equity Shares of the Company are compulsorily traded in dematerialised form at all the stock exchanges viz. Bombay
Stock Exchange Limited and National Stock Exchange of India Ltd. under depository systems at both the Depositories viz.
National Securities Depository Limited and Central Depository Services (India) Limited. Over 98.31 % of the share capital of
the Company has already been dematerialised.
k) Outstanding GDRs /ADRs /Warrants or Convertible Instrument
As on 30th June, 2009, the Company did not have any outstanding GDRs/ ADRs.
In terms of the Letter of Offer dated 17th July, 2008 the Company issued 39,98,240, Equity Shares on Rights basis along
with 39,98,240 Detachable Warrants on 12th September, 2008. These Warrants are to be converted into Equity Shares of the
Company after 6 months but within 48 months from the date of allotment at a price and on the terms of payment as described
in the Offer document. All these warrants are pending conversion as on the date of this Report.
h) Share Transfer System
After the request for transfer/transmission of shares is approved by the Company Secretary/Investors’ Grievance Committee,
the same is sent to the Registrar & Share Transfer Agent for completing the necessary procedural formalities and despatch
to the shareholder. Shares when received for transfer etc. if found to be in order in all respect are normally effected within a
period of 15 days from the date of receipt. A total of 3955 shares were transferred/ transmitted during the year 2008-09. The
dematerialised shares are directly credited to the respective Demat Account of beneficiaries by the Depositories.
i) Distribution of Shareholding
a) The distribution of shareholding as on 30th June, 2009 was as follows:
Number of Equity Shares
held in the range of
Number of
Shareholders
Percentage of total
Shareholders
Number of
Shares held
Percentage of
total Shares1 - 500 12,806 86.09 18,05,547 8.24
501 - 1,000 1,058 7.11 8,22,910 3.751,001 - 2,000 526 3.54 7,83,414 3.572,001 - 3,000 162 1.09 4,12,985 1.883,001 - 4,000 71 0.48 2,51,081 1.154,001 - 5,000 64 0.43 2,98,008 1.365,001 - 10,000 88 0.59 6,28,470 2.87
10,001 & Above 100 0.67 1,69,16,520 77.18Total 14,875 100.00 2,19,18,935 100.00
b) Details of Shareholding as on 30th June, 2009 was as follows:
Sl. No. CategoryNumber of shares
held
Percentage of
Shareholding1. Promoter and Promoter Group 1,17,97,163 53.822. Mutual Funds / UTI 3,350 0.023. Financial Institutions/ Banks 4,01,514 1.834. Insurance Companies 16,36,961 7.475. Bodies Corporate 19,02,946 8.686. Public 562,1,590 25.647. Foreign Nationals 72,027 0.338. Clearing Members 4,83,384 2.21
Total 2,19,18,935 100.00
The Oudh Sugar Mills Limited30
l) Location of the Plants
Sugar Mills:
a. Hargaon, District-Sitapur, Uttar Pradesh, Pin-261 121.
b. Rosa, District-Shahjahanpur, Uttar Pradesh, Pin-242 406.
c. Narkatiaganj, District-West Champaran, Bihar, Pin-845 455.
d. Hata, District-Kushinagar, Uttar Pradesh, Pin-274207
Distilleries:
a. Hargaon, District-Sitapur, Uttar Pradesh, Pin-261 121.
b. Narkatiaganj, District-West Champaran, Bihar, Pin-845 455.
Food Processing Factory:
P.O. Bamrauli, Allahabad, Uttar Pradesh, Pin-211 012.
Co-generation Power Plant:
a. Hargaon, District-Sitapur, Uttar Pradesh, Pin-261 121.
b. Narkatiaganj, District-West Champaran, Bihar, Pin-845 455.
c. Hata, District-Kushinagar, Uttar Pradesh, Pin-274207
m) Address for Correspondence
The Company Secretary
The Oudh Sugar Mills Ltd.
9/1, R.N. Mukherjee Road,
5th Floor
Kolkata - 700 001
Tel. No. : 91-033-2243 0497/8
Fax No. : 91-033-2248 6369
e-mail : [email protected]
Link Intime India Private Limited
(Unit: The Oudh Sugar Mills Ltd.)
C-13,Pannalal Silk Mills Compound
L.B.S. Marg, Bhandup (West)
Mumbai - 400 078
Tel. No.: 91- 022 – 2596 3838
Fax No.: 91- 022 – 2594 6969
e-mail : [email protected]
Link Intime India Private Limited
(Unit: The Oudh Sugar Mills Ltd.)
203, Daver House
197/199, D.N. Road
Mumbai - 400 001
Tel. No.: 91-022-2269 4127
10. BRIEF RESUME OF DIRECTORS SEEKING APPOINTMENT / RE-APPOINTMENT
i) Mr. Rohit Kumar Dhoot, aged 40 years, is a Chartered Accountant. He is a businessman of wide experience occupying the
position of Managing Director of Dhoot Industrial Finance Limited and Directorship in several companies.
Names of Indian Public Limited Companies in which Mr. Rohit Kumar Dhoot is a Director or Chairman/Member of Board
Committees.
Sl. No. Name of the Company Name of Board Committee Chairman/ Member
1 Dhoot Industrial Finance Limited -- --
2. Anukool Traders & Finance Limited -- --
3. Aakarshak Synthetics Limited -- --
4. Avilok Trade & Finance Limited -- --
5. Young Buzz India Limited -- --
6. The Oudh Sugar Mills Limited
Audit Committee Member
Investors’ Grievance
CommitteeMember
7. Ashish Trading and Finance Limited -- --
ii) Mr. Haigreve Khaitan aged 38 years, is a practicing Advocate since 1995 and a Partner in Khaitan & Co. His area of expertise
include commercial & corporate laws, tax laws, mergers and acquisitions, restructuring, foreign collaboration, licensing etc.
31 Annual Report 2008-09 REPORT ON CORPORATE GOVERNANCE
11. INTERNAL CONTROL SYSTEM
The Internal Control System of the Company is aimed at proper utilisation and safeguarding of the Company’s resources and also at promoting operational efficiency. The Internal Audit of the Company is conducted by various firms of Chartered Accountants. The findings of the Internal Audit and consequent corrective actions initiated and implemented from time to time are placed before the Audit Committee. The Audit Committee reviews such audit findings and the adequacy of Internal Control System.
12. HUMAN RESOURCE DEVELOPMENT/INDUSTRIAL RELATIONS
Continuous learning is the cornerstone of the Company’s human resource policy. The Company’s human resource policy is structured to meet the aspirations of the employees as well as of the organisation. The Company has adopted a progressive policy of continuous development of its human resources by training and motivating its employees to attain greater efficiency and competency.
The current strength of management staff is 85 and non-management staff is 1831.
Industrial relations in all the units were cordial throughout the year under review.
13. RISK MANAGEMENT
The Company has in place a Risk Management Policy, which lays down a robust and dynamic process for identification and
mitigation of risks. This Policy has been adopted by the Audit Committee as well as the Board of Directors of the Company. The Audit Committee reviews the risk management and mitigation plan from time to time, the last such review being on 25th August, 2009. The Company has also constituted a committee to assess the risk profile of the Company and to suggest mitigation plan.
14. INSIDER TRADING
The Company has adopted the Code of Internal Procedures and Conduct framed under the SEBI (Prohibition of Insider Trading) Regulations, 1992, as amended, to, inter alia, prevent insider trading in the shares of the Company.
15. CODE OF CONDUCT & ETHICS
The Company has adopted a Code of Conduct and Ethics (Code) for the members of Board of Directors and Senior Management Personnel of the Company. The essence of the Code is to conduct the business of the Company in an honest and ethical manner, in compliance with applicable laws and in a way that excludes considerations of personal advantage. All Directors and Senior Management Personnel have affirmed compliance with the Code, and a declaration to this effect, signed by the Managing Director, is attached to this report.
Names of Indian public limited companies in which Mr. Haigreve Khaitan is a Director or Chairman/Member of Board
Committees.
Sl No Name of the Company Name of Board Committee Chairman/ Member1 The Oudh Sugar Mills Ltd. -- --2 Ceat Limited -- --3 Dhunseri Tea & Industries Limited -- --4 Harrisons Malayalam Limited Audit Committee Member5 Inox Leisure Limited Audit Committee Member
6 National Engineering Industries LimitedAudit Committee Member
Investors’ Grievance
CommitteeMember
7 Jindal Steel & Power Limited -- --
8 Rama Newsprint & Papers LimitedInvestors’ Grievance
CommitteeMember
9 Sterlite Technologies Limited Audit Committee Member10 TCPL Packaging Limited -- --11 The Madras Aluminium Company Limited -- --12 Xpro India Limited -- --13 AVTEC Limited Audit Committee Member14 Bennett Coleman & Co Ltd Audit Committee Member15 Great Eastern Energy Corporation Ltd. -- --
The Oudh Sugar Mills Limited32
To
The Members
The Oudh Sugar Mills Limited
P.O. Hargaon, Dist. Sitapur
U.P. - 261 121
Pursuant to Clause 49 of the Listing Agreement with Stock Exchanges, I, Chandra Shekhar Nopany, Chairman-cum-Managing Director of
The Oudh Sugar Mills Limited, declare that all the Board Members and Senior Executives of the Company have affirmed their compliance
with the Code of Conduct and Ethics during the year 2008-09.
Place : Mumbai Chandra Shekhar Nopany
Dated, 25th August, 2009 Chairman-cum-Managing Director
For S.R. Batliboi & Co.
Chartered Accountants
Per R.K. AGRAWAL
Place : Kolkata Partner
Dated, 25th August, 2009 Membership No. 16667
To
The Members
The Oudh Sugar Mills Limited
We have examined the compliance of conditions of Corporate Governance by THE OUDH SUGAR MILLS LIMITED, for the year ended 30th
June, 2009, as stipulated in clause 49 of the Listing Agreement of the said Company with Stock Exchanges.
The compliance of conditions of Corporate Governance is the responsibility of the management. Our examination was limited to procedures
and implementation thereof, adopted by the Company for ensuring the compliance of the conditions of the Corporate Governance. It is
neither an audit nor an expression of opinion on the financial statements of the Company.
The Chairman of the Audit Committee has not attended the Annual General Meeting held on 18th December, 2008. Subject to above, 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.
We further state that 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.
DECLARATION BY THE MANAGING DIRECTOR ON CODE OF CONDUCT
AUDITORS’ CERTIFICATE ON CORPORATE GOVERNANCE
ANNEXURE - F
ANNEXURE - G
33 Annual Report 2008-09 REPORT ON CORPORATE GOVERNANCE
FINANCIAL STATEMENTS
CONTENTS
Financial Statements (Standalone)
Auditors’ report ...............................................................................................................................35
Balance Sheet ...................................................................................................................................38
Profit & Loss Account ....................................................................................................................39
Cash Flow Statement .....................................................................................................................40
Schedules ...........................................................................................................................................41
Financial Statements (Consolidated)
Auditors’ report ...............................................................................................................................69
Balance Sheet ...................................................................................................................................70
Profit & Loss Account ....................................................................................................................71
Cash Flow Statement .....................................................................................................................72
Schedules ...........................................................................................................................................73
Financial Statements (Subsidiaries)
Financial Statements (Champaran Marketing Company Limited) ...................................99
Financial Statements (OSM Investment & Trading Company Limited) ....................... 110
Financial Statements (Hargaon Investment & Trading Company Limited) ............... 121
Financial Statements (Hargaon Properties Limited) ......................................................... 132
The Oudh Sugar Mills Limited34
AUDITORS’ REPORTTo
The Members of
The Oudh Sugar Mills Limited
We have audited the attached Balance Sheet of THE OUDH SUGAR MILLS LIMITED as at 30th June, 2009 and also the Profit and Loss Account and the Cash Flow Statement for the year ended on that date, annexed thereto. These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements based on our audit.
We conducted our audit in accordance with the auditing standards generally accepted in India. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by the management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.
As required by the Companies (Auditor’s Report) Order, 2003 (as amended) issued by the Central Government of India in terms of sub-section (4A) of Section 227 of the Companies Act, 1956, we enclose in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the said Order.
Further to our comments in the Annexure referred to above, we report that :–
(i) We have obtained all the information and explanations, which to the best of our knowledge and belief, were necessary for the purpose of our audit;
(ii) In our opinion, proper books of account as required by law have been kept by the Company so far as appears from our examination of those books;
(iii) The Balance Sheet, Profit and Loss Account and Cash Flow Statement dealt with by this report are in agreement with the books of account as submitted to us;
(iv) In our opinion, the Balance Sheet, Profit and Loss Account and Cash Flow Statement dealt with by this report comply with the accounting standards referred to in sub-section (3C) of Section 211 of the Companies Act, 1956, subject to our comments in para (vii) (b) below.
(v) On the basis of written representations received from the directors as on 30th June, 2009 and taken on record by the Board of Directors, we report that none of the directors is disqualified as on 30th June, 2009 from being appointed as a director in terms of Clause (g) of sub section (1) of Section 274 of the Companies Act, 1956;
(vi) Without qualifying our opinion, we draw attention to Note No. 7 on Schedule 23, regarding accounting of Sugarcane
purchases at Hargaon & Rosa Sugar units in Uttar Pradesh @ Rs. 110 per quintal for sugar season 2007-2008 as against the State Advised Price (SAP) of Rs. 125 per quintal in view of the interim order dated 8th September, 2008 of the Hon’ble Supreme Court. Since the matter is subjudice, the liability for differential price of Rs. 2,422.74 Lakhs is presently undeterminable and hence, no provision thereof has been made in the accounts.
(vii) Attention is drawn to the following notes on Schedule – 23 :
(a) Note Nos. 5 and 6 regarding non-adjustment of certain realisations in earlier years aggregating to Rs. 131.46 Lakhs (Previous Year Rs. 131.46 Lakhs) and non-provision of interest payable thereon, if any, in case of refund of such realisations. As the matters are under adjudication / not yet settled, the impact of above non-adjustment on the Company’s profit is not presently ascertainable;
(b) Note No. 8(b) regarding recognition of MAT Credit Entitlement of Rs. 836.59 Lakhs upto the Balance Sheet date based on the future profitability projections made by the management. However, we are unable to express any opinion on the above projections and their consequent impact, if any, on such recognition of MAT Credit Entitlement. Had the impact of above been considered, there would be a profit of Rs. 1,080.79 Lakhs as against the reported profit of Rs. 1,917.38 Lakhs for the year and the figures of Reserves & Surplus would be Rs. 10,728.81 Lakhs as against the reported figures of Rs. 11,565.40 Lakhs.
In respect of the above items, the previous year’s audit report was similarly modified.
In our opinion and to the best of our information and according to the explanations given to us, the said Statements of Account, Subject to the matters stated in para (vii) above, give the information required by the Companies Act, 1956, in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:
(a) in the case of Balance Sheet, of the state of affairs of the Company as at 30th June, 2009;
(b) in the case of Profit and Loss Account, of the profit of the Company for the year ended on that date; and
(c) in the case of Cash Flow Statement, of the cash flows for the year ended on that date.
For S. R. BATLIBOI & CO. Chartered Accountants
Per R. K. AGRAWALPlace: Kolkata PartnerDated: August 25, 2009 Membership No. 16667
Annual Report 2008-09 FINANCIAL STATEMENTS 35
ANNEXURE TO THE AUDITORS’ REPORT(referred to in our report of even date to the members of The Oudh Sugar Mills Limitedas at and for the year ended 30th June, 2009)
(i) (a) The Company has maintained proper records showing full particulars, including quantitative details and situations of fixed assets.
(b) Fixed Assets have been physically verified by the management during the year based on a phased programme of verifying all the assets over a period of two years, which in our opinion, is reasonable having regard to the size of the Company and the nature and value of its assets. As informed, no material discrepancies were noticed on such verification.
(c) There was no substantial disposal of fixed assets during the year.
(ii) (a) The management has conducted physical verification of inventory at reasonable intervals during the year.
(b) The procedures of physical verification of inventory followed by the management are reasonable and adequate in relation to the size of the Company and the nature of its business.
(c) The Company is maintaining proper records of inventory and no material discrepancies were noticed on such physical verification.
(iii) (a) As informed, the Company has not granted any loans, secured or unsecured to companies, firms or other parties covered in the register maintained under Section 301 of the Companies Act, 1956 and hence the requirements of clauses (iii) (b) to (d) of the order are not applicable.
(b) As informed, the Company has not taken any loans, secured or unsecured from companies, firms or other parties covered in the register maintained under Section 301 of the Companies Act, 1956 and hence the requirements of clauses (iii) (f) and (g) of the order are not applicable.
(iv) In our opinion and according to the information and explanations given to us, there is an adequate internal control system commensurate with the size of the Company and the nature of its business, for the purchase of inventory and fixed assets and for the sale of goods and services. During the course of our audit, no major weakness has been noticed in the internal controls in respect of these areas.
(v) (a) According to the information and explanations given to us, we are of the opinion that the particulars of contracts or arrangements referred to in Section 301 of the Companies Act, 1956 that need to be entered into the register maintained under the above section, have been so entered.
(b) In our opinion and according to the information and explanations given to us, the transactions made in
pursuance of such contracts or arrangements exceeding
the value of Rupees five Lakhs entered into during
the financial year, are at prices which are reasonable
having regard to the prevailing market prices at the
relevant time.
(vi) In respect of deposits accepted, in our opinion and
according to the information and explanations given to
us, the directives issued by the Reserve Bank of India and
the provisions of Sections 58A, 58AA or other relevant
provisions of the Companies Act, 1956 and the rules framed
thereunder, to the extent applicable, have been complied
with by the Company. We are informed by the management
that no order has been passed by the Company law Board,
National Company Law Tribunal or Reserve Bank of India or
any other Tribunal.
(vii) In our opinion, the Company has an internal audit system
commensurate with the size and nature of its business.
(viii) We have broadly reviewed the books of account maintained
by the Company pursuant to the rules made by the Central
Government for the maintenance of cost records under
Section 209(1) (d) of the Companies Act, 1956 in respect
of its products and are of the opinion that prima facie,
the prescribed accounts and records have been made and
maintained.
(ix) (a) The Company has generally been regular in depositing
undisputed statutory dues including provident fund,
investor education and protection fund, employees’
state insurance, income-tax, sales-tax, wealth-tax,
service tax, custom duty, excise duty, cess and other
material statutory dues with appropriate authorities
except for Cane Purchase Tax of Rs. 79.16 Lakhs
relating to the sugar unit in Bihar which remains
unpaid as on the Balance sheet date, pending disposal
by the State Government of the representation made
by the Bihar Sugar Mills Association for its remission.
(b) According to the information and explanations given
to us, no undisputed amounts payable in respect of
provident fund, investor education and protection
fund, employees’ state insurance, income-tax, sales-tax,
wealth-tax, service tax, custom duty, excise duty, cess
and other material statutory dues were outstanding, at
the year end for a period of more than six months from
the date they became payable.
(c) According to the records of the Company, the dues
outstanding in respect of income tax, sales tax, wealth
tax, service tax, custom duty, excise duty and cess on
account of any dispute are as follows :
The Oudh Sugar Mills Limited36
ANNEXURE TO THE AUDITORS’ REPORT (Contd.)
Name of the statute Nature of dues Amount (Rs. in Lakhs)Period to which the
amount relatesForum where dispute
is pending
Bihar Finance Act, 1981Tax on sale of Alcohol to country vendors & non submission of declaration forms
25.101984-85 to 1989-90, 1995-96, 1997-98 to 2000-01 & 2003-04
Joint Commissioner (Appeals) / Appellate Tribunal/ High Court,
Patna
UP Trade Tax ActVarious Sales Tax / Entry tax demands on assessment
4.151977-78 to 1981-82 &
2000-01
Appellate Tribunal, Lucknow / High Court,
Allahabad
The Uttar Pradesh Tax on entry of Goods Act, 2000
On Sales of sugar 72.082000-01, 2001-02 &
2007-08
Asst. Commissioner / Deputy Commissioner / High Court, Allahabad
Central Sales Tax Act, 1956
Central Sales Tax demand on interstate sale
9.29 1993-94 to 2004-05 Joint Commissioner (Appeals)
Demand for Sales Tax / non – submission of Declaration Forms
5.07 2003-04Joint Commissioner
(Appeals) / High Court, Allahabad
Central Excise Act, 1944Disallowance of Cenvat Credit on certain inputs / capital items
112.261998-99, 2001-02, 2002-03, 2004-05 to 2007-08
Commissioner (Appeals) / CESTAT /
High Court, AllahabadExcise Duty on burnt / waste and loss on storage of molasses etc.
44.76 2002-03 to 2006-07Commissioner
(Appeals) / CESTAT / High Court, Allahabad
Utilisation of Cenvat Credit on Rectified Spirit
101.00 2000-01 CESTAT, Kolkata
Excise duty on loss on reprocessing of brown sugar
19.71 1988-89 CESTAT, Delhi
(x) The Company has no accumulated losses at the end of the financial year and it has not incurred cash losses in the current year and in the immediately preceding financial year.
(xi) Based on our audit procedures and as per the information and explanations given by the management, we are of the opinion that the Company has not defaulted in repayment of dues to any bank, except that the Company had applied for deferment of loans of Rs. 206.50 Lakhs and Rs. 449.45 Lakhs but the said deferment is stated to have been accepted by the banks from a later date. Accordingly there was a delay of 81 days and 27 days in repayment of the above amounts which have, however, been paid as per the revised schedule advised by the banks.
(xii) According to the information and explanations given to us and based on the documents and records produced to us, the Company has not granted loans and advances on the basis of security by way of pledge of shares, debentures and other securities.
(xiii) In our opinion, the Company is not a chit fund or a nidhi / mutual benefit fund / society and therefore, the provisions of clause 4(xiii) of the order are not applicable.
(xiv) In our opinion, the Company is not dealing or trading in shares, securities, debentures and other investments and therefore, the provisions of clause 4(xiv) of the order are not applicable.
(xv) According to the information and explanations given to us, the Company has given guarantees for loans taken by others from a bank, the terms and conditions whereof are stated to be not prima-facie prejudicial to the interest of the Company.
(xvi) Based on the information and explanations given to us by the management, term loans were applied for the purpose for which these were obtained.
(xvii) According to the information and explanations given to us and on an overall examination of the balance sheet of the Company, we report that Rs. 12886 Lakhs approx. raised on short-term basis have been used for long-term investment (without considering permanent working capital).
(xviii) The Company has not made any preferential allotment of shares during the year to parties or companies covered in the register maintained under Section 301 of the Companies Act, 1956.
(xix) The Company did not have any outstanding debentures during the year.
(xx) The Company has not raised any money through a public issue during the year.
(xxi) Based upon the audit procedures performed for the purpose of reporting the true and fair view of the financial statements and as per the information and explanations given by the management, we report that no fraud on or by the Company has been noticed or reported during the course of our audit.
For S. R. BATLIBOI & CO. Chartered Accountants
Per R. K. AGRAWALPlace: Kolkata PartnerDated: August 25, 2009 Membership No. 16667
Annual Report 2008-09 FINANCIAL STATEMENTS 37
(Rs. in Lakhs)
Schedule 30th June, 2009 30th June, 2008
SOURCES OF FUNDS
A. Shareholders’ Funds
(a) Share Capital 1 2,204.66 1,817.49
(b) Reserves & Surplus 2 11,565.40 8,265.93
13,770.06 10,083.42
B. Loan Funds 3
(a) Secured 53,212.61 54,868.78
(b) Unsecured 16,091.80 20,706.75
69,304.41 75,575.53
C. Deferred Tax Liability (net) 630.09 -
83,704.56 85,658.95
APPLICATION OF FUNDS
A. Fixed Assets 4
(a) Gross Block 71,732.45 48,601.07
(b) Less: Accumulated Depreciation 17,493.15 15,174.12
(c) Net Block 54,239.30 33,426.95
(d) Capital Work- in- Progress 209.90 340.80
(e) Capital Expenditure on New / Expansion Projects 5 14,319.69 25,677.31
68,768.89 59,445.06
B. Investments 6 1,079.23 1,079.46
C. Deferred Tax Asset (net) - 432.24
D. Current Assets, Loans & Advances
(a) Inventories 7 17,380.17 29,039.82
(b) Sundry Debtors 8 775.32 648.39
(c) Cash & Bank Balances 9 520.04 422.29
(d) Other Current Assets 10 9.02 4.55
(e) Loans & Advances 11 6,052.14 5,699.99
24,736.69 35,815.04
E. Less: Current Liabilities & Provisions 12
(a) Current Liabilities 10,334.83 10,953.79
(b) Provisions 545.42 159.06
10,880.25 11,112.85
Net Current Assets 13,856.44 24,702.19
83,704.56 85,658.95
Accounting Policies and Notes to Accounts 23
Schedules referred to above form an integral part of the Balance Sheet.
BALANCE SHEETas at 30th June, 2009
As per our report of even date. For S. R. BATLIBOI & CO.Chartered Accountants
Per R. K. AGRAWALPartnerMembership No. 16667 Place: Kolkata G. N. Pareek Chandra Shekhar Nopany Chairman - cum - Mg. Director Dated: 25th August, 2009 Company Secretary A. C. Dalal Director
The Oudh Sugar Mills Limited38
(Rs. in Lakhs)Schedule 2008-2009 2007-2008
INCOMEGross Sales 13 58,309.13 35,393.59 Less : Excise Duty 2,085.46 1,926.61 : Cess 574.30 2,659.76 311.08 2,237.69 Net Sales 55,649.37 33,155.90 Other Income 14 284.51 1,025.94
55,933.88 34,181.84 EXPENDITURE
Decrease / (Increase) in Stocks 15 12,606.43 (9,630.41)Excise Duty & Cess on Stocks (1,242.30) 574.12 (Refer note no. 4 on Schedule 23)Agricultural Loss 16 21.48 25.99 Purchase of Finished Goods 260.67 145.74 Raw Materials Consumed 17 24,430.58 28,301.83 Stores, Spares & Packing Materials Consumed 18 2,406.05 2,970.39 Fuel & Electricity 700.89 536.86 Payments to and Provisions for Employees 19 2,928.36 2,887.82 Manufacturing, Selling and Other Expenses 20 3,196.48 3,040.49 Directors’ Remuneration 21 46.89 48.43
45,355.53 28,901.26 Profit before Interest, Depreciation & Taxation 10,578.35 5,280.58 Less : Interest & Finance Charges (net) 22 4,941.53 3,677.82 Depreciation 2,632.03 2,229.68
7,573.56 5,907.50 Profit / (Loss) before Taxation 3,004.79 (626.92)Provision for Taxation:Current Tax [including wealth tax Rs. 3.00 Lakhs(Rs. 3.00 Lakhs)] 122.02 3.00 Deferred Tax charge / (credit) 1,062.33 (212.12)Minimum Alternative Tax Credit (Entitlement) / Reversal (119.02) 3.93 Provision for Income Tax no longer required written back 1.67 0.60 Provision for Fringe Benefit Tax 23.75 30.14 Profit / (Loss) after Taxation 1,917.38 (451.27)Surplus brought forward from previous year 78.69 29.96 Transfer from General Reserve - 500.00 Profit available for Appropriation 1,996.07 78.69 Appropriations :-
Transfer to General Reserve 100.00 - Proposed dividend on Equity Shares 328.79 - Tax on Dividend 55.88 - Surplus carried to Balance Sheet 1,511.40 78.69
1,996.07 78.69 Earning per Share of Rs. 10 each (Basic and Diluted) (Rs.) 9.34 (2.48)(Refer note no. 15 on Schedule 23)
Accounting Policies and Notes to Accounts 23
Schedules referred to above form an integral part of the Profit & Loss Account.
PROFIT & LOSS ACCOUNTfor the year ended 30th June, 2009
As per our report of even date. For S. R. BATLIBOI & CO.Chartered Accountants
Per R. K. AGRAWALPartnerMembership No. 16667 Place: Kolkata G. N. Pareek Chandra Shekhar Nopany Chairman - cum - Mg. Director Dated: 25th August, 2009 Company Secretary A. C. Dalal Director
Annual Report 2008-09 FINANCIAL STATEMENTS 39
(Rs. in Lakhs)2008-2009 2007-2008
A. CASH FLOW FROM OPERATING ACTIVITIES :Profit / (Loss) before Tax 3,004.79 (626.92)Adjustments for :
Depreciation 2,634.91 2,232.02 Interest & Finance Charges (net of capitalisation & Subsidy) 5,120.35 3,717.39 Molasses Storage and Maintenance Reserve 4.02 6.55 Profit on Fixed Assets sold / discarded (21.38) (66.42)Profit on sale of Long Term Investments - (15.31)Interest & Dividend Income (178.86) (39.86)Bad Debts, irrecoverable claims & advances written off 29.03 11.97 Provision for Warranties & Claims 5.78 6.86 Provision for diminution in the value of investments Written Back - (0.25)Provision for bad and doubtful debts/advances (net) 101.31 52.50
Operating Profit before Working Capital Changes : 10,699.95 5,278.53 Adjustments for :
Decrease in Trade Payables (748.91) (4,290.68)Increase in Trade & Other Receivables (324.06) (2,310.36)Decrease / (Increase) in Inventories 11,659.65 (9,565.96)
10,586.68 (16,167.00)Cash Generated from Operations : 21,286.63 (10,888.47)
Direct Taxes Refund / (Paid) 51.40 (41.02)Net Cash from Operating Activities 21,338.03 (10,929.49)
B. CASH FLOW FROM INVESTING ACTIVITIES :Sale of Fixed Assets 194.84 201.77 Capital Subsidy 142.18 200.83 Sale of Investments 0.23 16.62 Loans Received back 20.42 1.44 Interest Received 174.35 38.57 Dividend Received 0.04 0.28 Purchase of Investments - (1.00)Fixed deposits (173.16) (1.30)Purchase of Fixed Assets (8,600.88) (17,747.44)
Net Cash used in Investing Activities (8,241.98) (17,290.23)C. CASH FLOW FROM FINANCING ACTIVITIES :
Proceeds from Borrowings 10,243.17 45,791.39 Repayment of Loans (16,972.99) (11,304.12)Rights issue of Shares 387.17 - Share Premium on rights issue of shares 1,935.84 - Rights Shares Issue Expenses (173.10) - Interest & Finance Charges Paid (net of Subsidy) (8,591.45) (6,358.51)Dividend Paid (including dividend tax) (0.10) (0.32)
Net Cash from Financing Activities (13,171.46) 28,128.44 NET CHANGES IN CASH & CASH EQUIVALENTS (A+B+C) (75.41) (91.28)* Cash & Cash equivalents - Opening Balance 365.79 457.07 * Cash & Cash equivalents - Closing Balance 290.38 365.79
*Represents Cash and Bank balances as indicated in Schedule - 9 , and excludes Rs. 229.66 Lakhs (Rs. 56.50 Lakhs) being bank balances with restricted use or with maturity of more than three months.
CASH FLOW STATEMENTfor the year ended 30th June, 2009
As per our report of even date. For S. R. BATLIBOI & CO.Chartered Accountants
Per R. K. AGRAWALPartnerMembership No. 16667 Place: Kolkata G. N. Pareek Chandra Shekhar Nopany Chairman - cum - Mg. Director Dated: 25th August, 2009 Company Secretary A. C. Dalal Director
The Oudh Sugar Mills Limited40
SCHEDULES to the Balance Sheet
(Rs. in Lakhs)
30th June, 2009 30th June, 2008
SCHEDULE - 1 : SHARE CAPITAL
Authorised :
4,00,00,000 Equity Shares of Rs. 10 each 4,000.00 4,000.00
Issued :
2,21,72,060 (1,81,73,820) Equity Shares of Rs. 10 each 2,217.21 1,817.38
1,883 1/2 Equity Shares of Rs. 100 each 1.89 1.89
2,219.10 1,819.27
Subscribed & Paid-up :
2,19,18,935 (1,81,73,820) Equity Shares of Rs. 10 each fully paid 2,191.89 1,817.38
44 Quarter Equity Shares of Rs. 25 each fully paid 0.01 0.01
Bearer Equity Share Coupons of Rs. 25 and Rs. 12.50 each fully paid 0.06 0.06
2,191.96 1,817.45
Add: Forfeited Shares (amount originally paid-up) 12.70 0.04
2,204.66 1,817.49
Note :
Out of the above 6,11,550 Equity Shares have been issued for consideration other than cash and 11,55,575 Equity Shares have been
allotted as Bonus Shares by capitalisation of Securities Premium and General Reserve.
SCHEDULE - 2 : RESERVES & SURPLUS
Capital Reserve :
As per last account 195.88 195.88
Capital Redemption Reserve :
As per last account 37.69 37.69
Securities Premium :
As per last account 6,247.67 6,247.67
Add : Received on Rights Shares issued 1,935.84 -
8,183.51 6,247.67
Less : Adjustment of Rights Shares issue expenses 173.10 -
8,010.41 6,247.67
General Reserve :
As per last account 1,625.12 2,200.00
Add : Transfer from Profit & Loss Account 100.00 -
Less : Impact of Revised AS-15 as on 1st July,2007 (Net of Tax) - 74.88
: Transfer to Profit & Loss Account - 500.00
1,725.12 1,625.12
Molasses & Alcohol Storage and Maintenance Reserve :
As per last account 78.04 71.49
Add : Provided during the year 4.02 6.55
82.06 78.04
Effluent Disposal Reserve :
As per last account 2.84 2.84
Surplus as per Profit & Loss Account 1,511.40 78.69
11,565.40 8,265.93
Annual Report 2008-09 FINANCIAL STATEMENTS 41
SCHEDULES to the Balance Sheet (Contd.)
(Rs. in Lakhs)
30th June, 2009 30th June, 2008
SCHEDULE - 3 : LOAN FUNDSA. Secured Loans :
Term Loans
Long TermFrom Scheduled Bank(s):
Under Project Finance Loan Scheme 30,497.23 24,572.42
Under Financial Assistance Scheme (Excise Duty Loan) 3,985.00 3,985.00
Interest accrued & due 799.05 254.50
From Sugar Development Fund 5,334.05 5,207.86
From a Body Corporate 1,200.00 2,400.00
Short TermFrom a Scheduled Bank 2,100.00 1,000.00
From a Body Corporate - 1,000.00
Other Loans From a Scheduled Bank on Cash Credit Account 9,297.28 16,449.00
53,212.61 54,868.78 B. Unsecured Loans :
Short Term Loan from a Scheduled Bank - 1,000.00
From State Bank of India against Crop Loan to Canegrowers 2,560.34 2,215.21
From Subsidiary Companies (not bearing interest) 123.25 165.00
Inter Corporate Loans 13,010.00 16,919.00
Fixed Deposits from Staff and Others 306.29 308.39
Trade and other Deposits (partly not bearing interest) 91.92 99.15
16,091.80 20,706.75 69,304.41 75,575.53
NOTES :
1 Term loans from Scheduled Bank(s) (except Excise Duty Loan) and from a Body Corporate are secured by first mortgage / charge on all the immovable and movable assets (save and except book debts), present and future, of the Company’s Sugar Units at Hargaon, Rosa, Narkatiaganj and Dhadha Bujurg (Hata) and Distillery Unit at Hargaon, ranking pari-passu amongst the various lenders, subject to prior charges created on movables for working capital borrowings from the Company’s bankers.
Term loans under Financial Assistance Scheme (Excise Duty Loan) are to be secured by a residual charge on the entire Fixed Assets (movable and immovable) of the Company’s Sugar Units at Hargaon, Rosa and Narkatiaganj.
2 Term loans from the Sugar Development Fund are secured by a second charge on all the immovable / movable assets (save and except book debts) present and future of the Company’s Sugar Units at Hargaon and Narkatiaganj and include Rs. 738.66 Lakhs(Rs. 824.51 Lakhs) towards interest which, as per stipulated terms, is payable on a long term basis.
3 a. Short term loan of Rs. 900 Lakhs (Rs. 1,000 Lakhs) from a Scheduled Bank / a Body Corporate is secured by the pledge of certain shares held as Investments by the Company’s Subsidiaries.
b. Short term loan of Rs. 1,200 Lakhs (Rs. Nil) from a Scheduled Bank is secured by first mortgage / charge on all the immovable and movable assets, present and future, of the Company’s Sugar Unit at Rosa, ranking pari-passu amongst the various lenders.
4 Cash Credit borrowings are secured by hypothecation of entire current assets of the Company and also by a charge on the immovable assets as follows :-
a. Canning factory at Allahabad - First Charge
b. Sugar Unit at Rosa - Second Charge
c. Sugar Units at Hargaon and Narkatiaganj - Third Charge
5 Unsecured loans, as stated above, include Rs. 15,777.17 Lakhs (Rs. 20,280.68 Lakhs) falling due for payment within one year.
The Oudh Sugar Mills Limited42
SCHEDULES to the Balance Sheet (Contd.)
(Rs.
in L
akhs
)
SCH
EDU
LE -
4 :
FIXE
D AS
SETS
GRO
SS B
LOCK
ACCU
MU
LATE
D D
EPRE
CIAT
ION
NET
BLO
CK A
S AT
PART
ICU
LARS
Ope
ning
Bala
nce
as a
t 1s
t Ju
ly,
2008
Addi
tion
s
durin
g th
e
year
Ded
ucti
ons/
Adju
stm
ents
As a
t 30
th
June
,
2009
Ope
ning
Bala
nce
as a
t 1s
t Ju
ly,
2008
For
the
year
Less
: On
Ded
ucti
ons/
Adju
stm
ents
Upt
o 30
th
June
,
2009
As a
t 30
th
June
,
2009
As a
t
30th
Jun
e,
2008
Free
Hol
d La
nd
326
.73
1,4
25.8
5 0
.02
1,7
52.5
6(a)
-
-
-
-
1,7
52.5
6 3
26.7
3
Build
ings
3,2
53.7
7 1
,342
.91
-
4,5
96.6
8 4
88.9
8 8
5.62
-
5
74.6
0 4
,022
.08
2,7
64.7
9
Plan
t &
Mac
hine
ry 4
4,27
3.56
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64
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ay S
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tal W
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340
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248
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75
NO
TES
:
(a)
Incl
udes
Rs.
3.46
Lak
hs b
eing
the
val
ue o
f ag
ricul
tura
l lan
d m
easu
ring
abou
t 38
39 a
cres
tog
ethe
r w
ith
esti
mat
ed w
ritte
n do
wn
valu
e of
imm
ovab
le a
sset
s th
ereo
n, t
aken
ove
r by
the
Gov
ernm
ent
of U
ttar
Pra
desh
und
er t
he U
.P. I
mpo
siti
on o
f Ce
iling
of
Land
Hol
ding
Act
,196
0, a
cas
e w
here
of is
pen
ding
in t
he c
ourt
.
(b)
Incl
udes
adv
ance
aga
inst
pur
chas
e of
fix
ed A
sset
s Rs
. 83.
85 L
akhs
(Rs.
112.
65 L
akhs
).
(c)
Incl
udes
ass
ets
held
in jo
int
owne
rshi
p w
ith
othe
rs R
s. 11
2.12
Lak
hs (R
s. 11
0.49
Lak
hs).
Annual Report 2008-09 FINANCIAL STATEMENTS 43
SCHEDULES to the Balance Sheet (Contd.)
(Rs. in Lakhs)
30th June,
2009
30th June,
2008
SCHEDULE - 5 : CAPITAL EXPENDITURE ON NEW / EXPANSION PROJECTS
A. Freehold Land 997.99 1,089.65
B. Fixed Assets
(1) Buildings 40.16 37.10
(2) Plant & Machinery 128.52 14.08
(3) Motor Cars, Lorries & Other Conveyance 1.17 1.17
(4) Furniture & Fixtures 71.67 49.39
241.52 101.74
Less: Depreciation (charged to Pre-operative expenses as below) 76.57 164.95 59.05 42.69
C. Machinery and Building under erection 27,171.02 24,194.44
D. Materials at site including goods in transit
[net of sales Rs. 175.36 Lakhs (Rs. 161.46 Lakhs)] 224.81 1,277.06
E. Advances against purchase of fixed assets 1,234.97 2,336.15
29,793.74 28,939.99
Less: Transfer to Fixed Assets during the year 18,242.29 6,629.21
11,551.45 22,310.78
F. Incidental Expenditure (including during trial run period)
pending allocation to Fixed Assets :
Amount brought forward from previous year 3,366.53 837.57
Add for the year :
Salaries, Wages, Bonus, etc. 295.50 195.54
Contribution to Provident & Other Funds 12.32 6.22
Gratuity 1.43 0.53
Fuel & Electricity 246.51 156.00
Raw Materials Consumed 256.27 -
Stores, Spares & Packing Materials consumed 40.18 -
Project Consultancy / Supervision Charges 7.33 133.28
Insurance Charges 21.72 35.06
Miscellaneous Expenses [including Rs. 1.20 Lakhs (Rs. 1.50
Lakhs) paid for various certificates to the Statutory
Auditors] 184.94 242.94
Interest & Finance Charges [including Rs. 2105.55 Lakhs
(Rs. 1005.61 Lakhs) on fixed loans] 3,442.48 2,362.35
Depreciation 17.52 45.68
7,892.73 4,015.17
Less: Closing Stocks :
Finished Goods 176.20 -
By-Products 24.03 -
Goods under Process 72.97 273.20 - -
7,619.53 4,015.17
Less: Capitalised / Allocated to Fixed Assets during the year 4,851.29 648.64
2,768.24 3,366.53
14,319.69 25,677.31
The Oudh Sugar Mills Limited44
SCHEDULES to the Balance Sheet (Contd.)
(Rs. in Lakhs)
No. of SharesFace Value per
share (Rs.)30th June, 2009 30th June, 2008
SCHEDULE - 6 : INVESTMENTS
Long Term
Government Securities :
Quoted :
5 1/2 % U.P. State Development Loan,1977 - (c) -
5 1/2 % U.P. State Development Loan,1981 0.60 (d) 0.60
11 % Bihar State Development Loan, 2001 0.53 0.53
1.13 1.13
Unquoted :
12 Years National Savings Certificates 0.08 (d) 0.08
7 Years National Savings Certificates 0.02 (d) 0.02
6 Years National Savings Certificates 1.12 1.35
12 Years National Defence Certificates 0.04 (d) 0.04
12 Years National Plan Savings Certificates - (c) -
10 Years National Savings Certificates 0.01 (d) 0.01
7 Years National Defence Certificates - (c) -
1.27 1.50
Equity Shares (Fully Paid)
Quoted :
Upper Ganges Sugar & Industries Ltd. 18,562 10 13.23 13.23
13.23 13.23
Unquoted :
In Subsidiary Companies
Champaran Marketing Company Ltd. 43,49,000 2.50 192.96 192.96
Hargaon Investment & Trading Co. Ltd. 30,45,727 10 609.14 609.14
OSM Investment & Trading Co. Ltd. 17,40,418 10 261.06 261.06
1,063.16 1,063.16
In Other Companies
Bihar State Financial Corporation Ltd. 70 100 0.07 0.07
Moon Corporation Ltd. (‘A’ Class) 745 100 0.77 0.77
Moon Corporation Ltd. (‘B’ Class) 2,502 5 0.13 0.13
Birla Buildings Ltd. 1,920 10 0.19 0.19
The Oudh Trading Co. Pvt.Ltd. 25 100 0.03 0.03
A.P.V.Texmaco Ltd. (in liquidation) 28,750 10 0.86 (d) 0.86
Jai Hind Publishing Co.Ltd. (in liquidation) 80 25 - -
Akhil Bharat Printers Ltd. (in liquidation) 150 100 - -
Indo International Distillers Association Pvt. Ltd. 54,000* 10 5.40 (d) 5.40
7.45 7.45
1,086.24 1,086.47
Share Application Money :
Indo International Distillers Association Pvt. Ltd. 46,000* 10 4.60 (d) 4.60
1,090.84 1,091.07
Less : Provision for diminution in the value of
Investments 11.61 11.61
1,079.23 (b) 1,079.46
Annual Report 2008-09 FINANCIAL STATEMENTS 45
SCHEDULES to the Balance Sheet (Contd.)
(Rs. in Lakhs)
30th June, 2009 30th June, 2008
SCHEDULE - 6 : INVESTMENTS (Contd.)
Book Value Market Value Book Value Market Value
Aggregate Value Of Investments :
Book Value
Quoted 13.76 13.51 13.76 13.17
Unquoted 1,065.47 1,065.70
1,079.23 1,079.46
NOTES :
(a) All the above investments are Non-Trade, except those marked with an asterisk.
(b) Includes Government Securities of the face value of Rs. 1.76 Lakh (Rs. 1.99 Lakh) and Rs. 0.60 Lakh (Rs. 0.60 Lakh) deposited /
pledged with various Government authorities and Hon’ble Allahabad High Court respectively (including Rs. 0.73 Lakh (Rs. 0.71
Lakh) matured, but pending encashment).
(c) The figures, being less than Rs. 500, have not been shown above.
(d) Indicates securities where provision for diminution in the value of Investments has been made.
(Rs. in Lakhs)
30th June, 2009 30th June, 2008
SCHEDULE - 7 : INVENTORIES
At lower of cost and net realisable value
Raw Materials 886.36 235.44
Stores, Chemicals, Spare Parts, etc. 1,219.42 1,204.74
[including in transit Rs. 7.46 Lakhs (Rs. 12.19 Lakhs)]
Finished Goods 13,859.51 25,744.12
Power - Banked 29.38 30.75
Goods under Process 478.88 262.20
Standing Crop 38.83 30.60
16,512.38 27,507.85
At estimated net realisable value
By Products 852.85 1,509.43
Scrap 13.54 20.89
Country Crop 1.40 1.65
867.79 1,531.97
17,380.17 29,039.82
The Oudh Sugar Mills Limited46
SCHEDULES to the Balance Sheet (Contd.)
(Rs. in Lakhs)
30th June, 2009 30th June, 2008
SCHEDULE - 8 : SUNDRY DEBTORS
(Unsecured , unless otherwise specified)
(a) Debts due for a period exceeding six months :
Considered Good 21.89 31.81
Considered Doubtful 44.62 118.87
66.51 150.68
Less: Provision 44.62 118.87
21.89 31.81
(b) Other Debts
Considered Good
[includes secured Rs. 2.79 Lakhs (Rs. 6.06 Lakhs)] 753.43 616.58
775.32 648.39
SCHEDULE - 9 : CASH & BANK BALANCES
Cash in hand 42.41 19.66
Cheques / Drafts in hand 36.59 130.39
79.00 150.05
With Scheduled Banks on :
Current Account 178.09 176.51
Unpaid Dividend Account 10.73 10.83
Fixed Deposit Account [Receipts for Rs. 216.45 Lakhs (Rs. 30.70 Lakhs)
pledged with various Govt.authoritities as security / Bank as margin money] 229.66 56.50
418.48 243.84
With Non-Scheduled Banks on Current Account :
Name of the BankMaximum amount
outstanding during the year
Lucknow Kshetriya Gramin Bank 878.17 (1,554.31) 10.37 15.67
Zila Sahkari Bank Ltd., Sitapur 172.24 (169.56) 3.75 4.74
District Co-operative Bank Ltd., Lakhimpur Kheri 391.58 (547.04) 4.42 4.71
Urban Co-operative Bank Ltd., Lakhimpur Kheri 27.11 (26.09) 1.13 0.62
Avadh Gramin Bank, Hardoi 0.40 (0.69) 0.35 0.34
Baroda Uttar Pradesh Grameen Bank 242.60 (376.99) 2.10 1.74
22.12 27.82
With Post office on :
Savings Account (Pass Book lodged with various Govt.
Authorities) 0.44 0.58
520.04 422.29
Annual Report 2008-09 FINANCIAL STATEMENTS 47
SCHEDULES to the Balance Sheet (Contd.)
(Rs. in Lakhs)30th June, 2009 30th June, 2008
SCHEDULE -- 10 : OTHER CURRENT ASSETSInterest accrued on Investments 2.67 3.68 Accrued interest on loans, deposits etc. Considered Good 6.35 0.87 Considered Doubtful - 0.58
6.35 1.45 Less : Provision - 0.58
6.35 0.87 9.02 * 4.55
* including Rs. 0.43 Lakh (Rs. 0.91 Lakh) due for more than six months
SCHEDULE - 11 : LOANS AND ADVANCESUNSECUREDConsidered goodLoans :Not bearing interest :
To a Subsidiary Company 22.50 32.50 Bearing interest :
To Employees 30.57 29.61 To Others 3.69 15.07
56.76 77.18 AdvancesAdvances recoverable in cash or in kind or for value to be received or pending adjustments 771.16 1,052.35Sales tax, Excise duty etc. paid under appeal and / or under dispute 107.03 105.79Balance with Excise & other Govt.Authorities 3,445.38 2,775.34 Claims and Refunds receivable 783.20 768.98 Advance payment of Tax, Refunds receivable and Tax deducted at source (after adjusting provisions) - 151.03 Advance for Fringe Benefit tax (net of provision) 6.01 3.71 Minimum Alternative Tax Credit Entitlement 836.59 717.57 Sundry Deposits 46.01 48.04
5,995.38 5,622.81 6,052.14 5,699.99
Considered doubtful :Advances & Claims 343.20 280.74 Less : Provisions 343.20 280.74
- - 6,052.14 5,699.99
NOTES:Amount due from Officers of the Company
Loans - - Advances - 0.41
- 0.41 Maximum amount due at any time during the year
Loans - 6.00 Advances 9.77 7.27
9.77 13.27 Amount due from the Managing Director of the Company - - Maximum amount due at any time during the year - 6.09 Loan to a Subsidiary Company :
Champaran Marketing Company Limited 22.50 32.50 Maximum amount due at any time during the yearChamparan Marketing Company Limited 32.50 39.50
The Oudh Sugar Mills Limited48
SCHEDULES to the Balance Sheet (Contd.)
SCHEDULES to the Profit & Loss Account
(Rs. in Lakhs)30th June, 2009 30th June, 2008
SCHEDULE - 12 : CURRENT LIABILITIES & PROVISIONS A. Current Liabilities :
Acceptances 1,648.13 - Sundry Creditors for goods, services, expenses etc. Due to Micro and Small Enterprises 342.91 415.97 (Refer note no. 11 on Schedule 23) Due to Others 6,178.19 7,959.37 For Other Finance 385.78 682.31 Excess price of sugar including excise duty 79.41 79.41 Advance against sale of goods 1,639.64 1,748.71 Interest accrued but not due on loans, deposits etc. 42.62 36.67 Preference Shares Redemption Account 0.05 0.05 Unclaimed Scrip Dividend 0.04 0.04 Less: Shares held for distribution 0.04 - 0.04 - Fractional entitlements for Bonus Shares andBearer Coupons 0.07 0.07 Investor Education & Protection Fund : (not yet due) Unpaid & Unclaimed Dividends 10.73 10.83 Unclaimed matured Fixed Deposits 7.30 20.40
10,334.83 10,953.79 B. Provisions :
Leave 106.87 80.13 Gratuity - 70.81 Warranties 7.11 8.12 Taxation (net of advance tax) 46.77 - Proposed Dividend on Equity Shares 328.79 - Tax on proposed dividend 55.88 -
545.42 159.06 10,880.25 11,112.85
(Rs. in Lakhs)
2008-2009 2007-2008
SCHEDULE - 13 : GROSS SALES
Finished Goods 56,724.39 32,971.58
Power 587.06 725.56
By-Products 998.11 1,529.74
Sugar Hedging Transactions (net) - 135.24
Others 14.32 39.03
58,323.88 35,401.15
Less : Claims, Rebates etc. 14.75 7.56
58,309.13 35,393.59
Annual Report 2008-09 FINANCIAL STATEMENTS 49
(Rs. in Lakhs)2008-2009 2007-2008
SCHEDULE - 14 : OTHER INCOMEIncome from Long Term Investments (Non-Trade)Dividend 0.04 0.28 Interest - 0.01 Insurance & Other Claims 18.54 23.81 Rent & Hire Charges 17.38 18.94 Profit on sale of Long Term Investments (Non-Trade) - 15.31 Exchange rate fluctuations (net) 3.28 - Export Incentives 49.81 22.42 Unspent liabilities,excess provisions and unclaimed balances written back (net) 172.93 212.69 Provision for diminution in the value of investments no longer required written back - 0.25 Cane Price Subsidy for earlier years - 573.58 Buffer Stock subsidy towards Insurance & storage charges 4.58 83.50 Profit on Fixed assets sold / discarded (net) 11.20 66.42 Items Pertaining to previous years (net) 0.10 0.12 Miscellaneous Receipts 6.65 8.61
284.51 1,025.94
SCHEDULE - 15 : DECREASE / (INCREASE) IN STOCKS :Opening Stocks :
Finished Goods 25,744.12 16,732.27 Power - Banked 30.75 24.72 By-Products 1,509.43 840.80 Goods under Process 262.20 317.73 Scrap 20.89 21.46
27,567.39 17,936.98 Add: Stocks (Refer schedule- 5) :
Finished Goods 176.20 - By-Products 24.03 - Goods under Process 72.97 273.20 - -
27,840.59 17,936.98 Less : Closing Stocks :
Finished Goods 13,859.51 25,744.12 Power - Banked 29.38 30.75 By-Products 852.85 1,509.43 Goods under Process 478.88 262.20 Scrap 13.54 20.89
15,234.16 27,567.39 12,606.43 (9,630.41)
SCHEDULES to the Profit & Loss Account (Contd.)
The Oudh Sugar Mills Limited50
SCHEDULES to the Profit & Loss Account (Contd.)
(Rs. in Lakhs)
2008-2009 2007-2008
SCHEDULE - 16 : AGRICULTURAL LOSS
INCOME
Sales including inter- transfers Rs. 21.31 Lakhs (Rs. 24.78 Lakhs) 51.66 34.89 Other Income :Rent & Hire Charges 17.73 25.23 Profit on sale / discard of fixed assets 10.18 - Miscellaneous Receipts 0.40 28.31 3.24 28.47 Increase in Stocks :Closing Stock 40.23 32.25 Less : Opening Stock 32.25 7.98 29.21 3.04
87.95 66.40 EXPENDITURESeeds, Manures and Fodder Consumed 34.14 22.15 Stores & Spares Consumed 1.50 0.27 Tractor Expenses 29.92 32.29 Repairs to : Machinery 0.62 0.72 Building 0.20 0.06 Others 1.25 0.30 Lease Land Rent 1.58 - Rates & Taxes 0.19 0.15 Payments to and Provisions for Employees : Salaries, Wages & Bonus 31.24 26.79 Contribution to Provident and Other Funds 1.53 1.54 Gratuity 0.23 33.00 0.10 28.43 Insurance 0.12 0.15 Cartage & Transportation charges 0.23 1.09 Irrigation Expenses 0.97 0.82 Harvesting Expenses 0.44 1.06 Miscellaneous Expenses 2.39 2.56 Depreciation 2.88 2.34
109.43 92.39 Loss transferred to Profit & Loss Account 21.48 25.99
SCHEDULE - 17 : RAW MATERIALS CONSUMEDOpening Stock 235.44 337.35 Add : Purchase & Procurement Expenses [including transfer ofsugarcane from own farms Rs. 21.31 Lakhs (Rs. 24.78 Lakhs)] 24,799.72 27,864.24 Purchase Tax & Cess (net) 281.78 335.73
25,316.94 28,537.32 Less : Sales - 0.05 Closing Stock 886.36 235.44
24,430.58 28,301.83
SCHEDULE - 18 : STORES, SPARES & PACKING MATERIALS CONSUMEDStores, Spare Parts, Chemicals etc.[after adjusting Sales & Claims Rs. 200.71 Lakhs (Rs. 122.20 Lakhs)] 1,183.01 1,495.77 Packing Materials 1,223.04 1,474.62
2,406.05 2,970.39
Annual Report 2008-09 FINANCIAL STATEMENTS 51
SCHEDULES to the Profit & Loss Account (Contd.)
(Rs. in Lakhs)2008-2009 2007-2008
SCHEDULE - 19 : PAYMENTS TO AND PROVISIONS FOR EMPLOYEESSalaries, Wages, Bonus, etc 2,607.74 2,527.77 Contribution to Provident & Other Funds 218.59 208.16 Gratuity [Refer note no. 12(b) on Schedule 23] 7.49 68.15 Workmen Compensation - 1.62 Employees’ Welfare Expenses 94.54 82.12
2,928.36 2,887.82
SCHEDULE - 20 : MANUFACTURING, SELLING AND OTHER EXPENSES
Repairs to and Maintenance of :Buildings 161.86 105.23 Machinery 1,030.09 1,276.57 Others 25.21 21.00
Rent 79.24 76.04 Rates & Taxes (net) 37.41 38.27 Insurance 84.60 78.01 Auditors’ Remuneration :
As AuditorsAudit Fees 12.25 12.25 Tax Audit Fees 7.35 7.35 Limited Review Fees 7.35 4.50 In other capacity for Certificates & other services 4.71 2.02 For Expenses 2.06 1.96
Cost Auditors’ Remuneration :For Audit Fees 0.60 0.60 For Expenses 0.09 0.15
Selling Commission & Expenses :Commission on sales 268.56 159.60 Other Selling Expenses 448.07 400.28
Charity & Donations 15.80 4.97 Provision for bad and doubtful debts / advances 101.31 52.50 Provision for Warranties & Claims 5.78 6.86 Bad Debts, irrecoverable claims & advances written off 142.71 14.32 Less : Adjusted against provisions 113.68 29.03 2.35 11.97 Loss on sale of long term Investments - 24.75 Less : Adjusted against provisions - - 24.75 - Exchange rate fluctuations (net) - 2.13 Molasses Storage & Maintenance Reserve 4.02 6.55 Sales Tax for earlier years 5.12 - Sugar Hedging Transactions (net) 4.81 - Miscellaneous Expenses [including Directors’ travelling Rs. 14.92 Lakhs (Rs. 12.46 Lakhs)] 861.16 771.68
3,196.48 3,040.49
The Oudh Sugar Mills Limited52
SCHEDULES to the Profit & Loss Account (Contd.)
(Rs. in Lakhs) 2008-2009 2007-2008
SCHEDULE - 21: DIRECTORS’ REMUNERATIONProfit / (Loss) before Taxation as per Profit & Loss Account 3,004.79 (626.92)Add :
Depreciation (as per Accounts) 2,634.91 2,232.02 Provision for bad & doubtful debts/advances 101.31 52.50 Net Loss / (Profit) on fixed assets sold and / ordiscarded (as per Accounts) (21.38) (66.42)Directors’ Fees & Remuneration 105.41 97.57
2,820.25 2,315.67 5,825.04 1,688.75
Less :Depreciation(under Section 350 of the Companies Act, 1956) 2,634.91 2,232.02 Bad debts/advances adjusted against provision 113.68 2.35 Provision for Diminution in the value of Investmentsno longer required written back - 0.25 Net Loss / (Profit) on fixed assets sold / discarded(as per Section 349 of the Companies Act,1956) (27.14) 32.30 Directors’ Fees 2.52 3.47
2,723.97 2,270.39 Profit / (Loss) for the year 3,101.07 (581.64)Less / (Add) : Loss brought forward from the previous year 4,312.70 (3,731.06)Net Profit / (Loss) under Section 349 of the Companies Act, 1956 (1,211.63) (4,312.70)(A) Managing Director’s Remuneration :
Salary 39.00 39.00 Contribution to Provident Fund 4.68 4.68 Gratuity - 0.39 Provision for Leave 0.69 44.37 0.89 44.96
(B) Directors’ Fees 2.52 3.47 46.89 * 48.43
* Excludes Rs. 36.00 Lakhs (Rs. 30.00 Lakhs) and Rs. 22.52 Lakhs (Rs.19.14 Lakhs) paid towards rent and maintenance respectively of
the accommodation provided to the Managing Director and the same has been included under the head “Rent” and “Miscellaneous
Expenses” in Schedule 20.
Note: In view of the loss under Section 349, as stated above, no provision for Directors’ Commission has been made.
SCHEDULE - 22 : INTEREST & FINANCE CHARGES (NET)On Fixed Loans 4,258.03 3,368.46 On Other Loans 4,347.60 3,473.73 To Income Tax Department 8.03 -
8,613.66 * 6,842.19 Less : At Credit :
Amount Capitalised 3,458.08 2,513.86Buffer Stock Subsidy towards interest 35.23 610.94From Income Tax Department 14.54 -On Unsecured Loans, Deposits etc. (Gross) :[Tax deducted at source Rs. 35.42 Lakhs (Rs. 1.04 Lakhs)] 164.28 39.57
3,672.13 3,164.374,941.53 3,677.82
* excludes Rs. 477.67 Lakhs (Rs. 165.57 Lakhs) being interest on excise duty loan from a Bank which is recoverable as subsidy from the
Government.
Annual Report 2008-09 FINANCIAL STATEMENTS 53
SCHEDULE to the Balance Sheet and Profit & Loss Account
SCHEDULE – 23 : ACCOUNTING POLICIES AND NOTES TO ACCOUNTS
1. Statement Of Significant Accounting Policies :
(i) Basis of Preparation :
The financial statements have been prepared to comply
in all material respects with the Accounting Standards
Notified by the Companies Accounting Standards Rules,
2006 (as amended) and the relevant provisions of the
Companies Act, 1956. The financial statements have been
prepared under the historical cost convention on an accrual
basis. The accounting policies applied by the Company are
consistent with those used in the previous year.
(ii) Use of Estimates :
The preparation of financial statements in conformity
with generally accepted accounting principles requires
management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and
disclosure of contingent liabilities at the date of financial
statements and the results of operations during the
reporting year end. Although these estimates are based
upon the management’s best knowledge of current
events and actions, actual results could differ from these
estimates.
(iii) Revenue Recognition :
(a) Revenue from sale of goods is recognised upon
passage of title to the customers which generally
coincides with delivery thereof.
(b) Dividend Income is recognised when the
shareholders’ right to receive the payment is
established by the balance sheet date. Dividend
from subsidiaries is recognised even if the same is
declared after the balance sheet date but pertains to
period on or before the date of balance sheet as per
the requirement of Schedule VI of the Companies
Act, 1956.
(c) Due to uncertainty in realisation, following incomes
are accounted for on acceptance / actual receipt
basis :-
(i) Insurance and other claims.
(ii) Interest on doubtful loans and advances to
cane growers.
(iii) Compensation receivable in respect of
land surrendered to / acquired by the
Government.
(iv) Fixed Assets :
Fixed assets are stated at cost less accumulated depreciation
and impairment, if any. Cost comprises the purchase price
inclusive of duties (net of cenvat credit), taxes, incidental
expenses and erection / commissioning expenses etc. upto
the date the asset is ready for its intended use.
Machinery spares which can be used only in connection
with an item of fixed assets and whose use as per technical
assessment is expected to be irregular, are capitalised and
depreciated over the residual life of the respective assets.
Assets awaiting disposal are valued at the lower of written
down value and net realisable value.
(v) Impairment of Assets :
The carrying amounts of assets are reviewed at each
balance sheet date to determine whether there is any
indication of impairment based on external / internal
factors. An impairment loss is recognised wherever the
carrying amount of an asset exceeds its recoverable
amount which represents the greater of the net selling
price and ‘Value in use’ of the assets. The estimated future
cash flows considered for determining the value in use, are
discounted to their present value at the weighted average
cost of capital.
(vi) Depreciation :
(a) The classification of plant and machinery into
continuous and non continuous process is done as
per technical certification and depreciation thereon
is provided accordingly.
(b) Depreciation on fixed assets is provided as per
straight line method, at the rates prescribed in
schedule XIV of the Companies Act, 1956, except on
gross assets valuing Rs. 43.28 Lakhs (Rs. 43.28 Lakhs),
where written-down value method is followed.
(c) Depreciation on fixed assets added / disposed of
during the year is provided on pro-rata basis, with
reference to the date of addition / disposal.
(d) In case of impairment, if any, depreciation is
provided on the revised carrying amount of the
assets over its remaining useful life.
(vii) Government Grants and subsidies :
Government Grants and subsidies are recognised when
there is reasonable assurance that the same will be received.
Revenue grants / subsidies are recognised in the Profit &
Loss Account. Capital grants relating to specific fixed assets
are reduced from the gross value of the respective fixed
assets. Other capital grants are credited to capital reserve.
The Oudh Sugar Mills Limited54
SCHEDULE to the Balance Sheet and Profit & Loss Account (Contd.)SCHEDULE – 23 : ACCOUNTING POLICIES AND NOTES TO THE ACCOUNTS (Contd.)
(viii) Borrowing Costs :
Borrowing costs relating to acquisition / construction
of qualifying assets are capitalised until the time all
substantial activities necessary to prepare the qualifying
assets for their intended use are complete. A qualifying
asset is one that necessarily takes substantial period of
time to get ready for its intended use. All other borrowing
costs are charged to revenue.
(ix) Investments :
Investments that are readily realisable and intended to
be held for not more than a year are classified as Current
Investments. All other Investments are classified as Long
term Investments. Current Investments are stated at
lower of cost and market rate on individual investment
basis. Long term investments are considered “at cost” on
individual investment basis, unless there is a decline other
than temporary in the value, in which case adequate
provision is made against such diminution in the value of
investments.
(x) Inventories :
(a) Raw Materials, stores and spares are valued at
lower of cost and net realisable value. However,
these items are considered to be realisable at cost
if the finished products, in which they will be used,
are expected to be sold at or above cost. Cost is
determined on a weighted average basis.
Goods under process and finished goods (including
Power Banked) are valued at lower of cost and net
realisable value. Finished goods and Goods under
process include cost of conversion and other costs
incurred in bringing the inventories to their present
location and condition.
By products, Country crop and Saleable scraps,
whose cost is not identifiable, are valued at
estimated net realisable value.
Net realisable value is the estimated selling price
in the ordinary course of business, less estimated
costs of completion and estimated costs necessary
to make the sale.
(b) In case of inter-transferred materials, the transfer
price is considered as cost for the purpose of
valuation of closing stock.
(xi) Foreign Currency Transactions :
(a) Initial Recognition
Foreign currency transactions are recorded in the
reporting currency, by applying to the foreign
currency amount the exchange rate between the
reporting currency and the foreign currency at the
date of the transaction.
(b) Conversion
Foreign currency monetary items are reported using
the closing rate. Non-monetary items which are
carried in terms of historical cost denominated in
a foreign currency are reported using the exchange
rate at the date of the transaction and non-
monetary items which are carried at fair value or
other similar valuation denominated in a foreign
currency are reported using the exchange rates that
existed when the values were determined.
(c) Exchange Differences
Exchange differences arising on the settlement/
conversion of monetary items are recognised as
income or expenses in the year in which they arise.
(d) Forward Exchange Contracts not entered for trading
or speculation purpose
The premium or discount arising at the inception
of forward exchange contracts is amortised as
expenses or income over the life of the respective
contracts. Exchange differences on such contracts
are recognised in the statement of profit and loss in
the period in which the exchange rates change. Any
profit or loss arising on cancellation or renewal of
forward exchange contracts is recognised as income
or expense for the year.
(xii) Retirement Benefits :
(a) Retirement benefits in the form of Provident and
Pension Funds are defined contribution schemes and
are charged to the Profit and Loss Account of the year
when the contributions to the respective funds are
due. The Company has no obligations other than the
contribution payable to the respective trusts / funds.
(b) Gratuity liability being a defined benefit obligation
is provided for on the basis of actuarial valuation
on projected unit credit method made at the end of
each year.
(c) Long term compensated absences are provided
for based on actuarial valuation on projected unit
credit method made at the end of each year.
Annual Report 2008-09 FINANCIAL STATEMENTS 55
(d) Actuarial gains / losses are immediately taken to
profit and loss account and are not deferred.
(xiii) Taxation :
Tax expense comprises of current, deferred and fringe
benefit tax. Current income tax and fringe benefit tax
are measured at the amount expected to be paid to tax
authorities in accordance with Income Tax Act, 1961.
Deferred income tax reflects the impact of current year
timing differences between taxable income and accounting
income for the year and reversal of timing differences of
earlier years.
The deferred tax for timing differences between the book
and tax profit for the year is accounted for using the tax
rates and laws that have been substantively enacted as of
the Balance Sheet date. Deferred tax asset is recognised
only to the extent that there is reasonable certainty
that sufficient future taxable income will be available
against which such deferred tax asset can be realised. If
the company has carry forward unabsorbed depreciation
and tax losses, deferred tax asset is recognised only to
the extent that there is virtual certainty supported by
convincing evidence that sufficient taxable income will be
available in future against which such deferred tax asset
can be realised.
The carrying amounts of deferred tax assets are reviewed
at each balance sheet date. The company writes-down the
carrying amount of a deferred tax asset to the extent that
it is no longer reasonably certain or virtually certain, as the
case may be, that sufficient future taxable income will be
available against which deferred tax asset can be realised.
Any such write-down is reversed to the extent that it
becomes reasonably certain or virtually certain, as the case
may be, that sufficient taxable income will be available in
future.
At each balance sheet date the Company re-assesses
unrecognised deferred tax assets. It recognises unrecognised
deferred tax assets to the extent that it has become
reasonably certain or virtually certain, as the case may
be that sufficient future taxable income will be available
against which such deferred tax assets can be realised.
Minimum Alternative Tax (MAT) credit is recognised as
an asset only when and to the extent there is convincing
evidence that the company will pay normal income tax
during the specified period. In the year in which the
MAT credit becomes eligible to be recognised as an asset
in accordance with the recommendations contained in
the guidance Note issued by the Institute of Chartered
Accountants of India, the said asset is created by way of
a credit to the profit and loss account and shown as MAT
Credit Entitlement. The Company reviews the same at each
balance sheet date and writes down the carrying amount
of MAT Credit Entitlement to the extent there is no longer
convincing evidence to the effect that the Company will
pay normal Income Tax during the specified period.
(xiv) Segment Reporting :
(a) Identification of Segments :
The Company has identified that its operating
segments are the primary segments. The Company’s
operating businesses are organised and managed
separately according to the nature of products, with
each segment representing a strategic business unit
that offers different products and serves different
markets. The analysis of geographical segments is
based on the areas in which the customers of the
Company are located.
(b) Inter Segment Transfers :
The Company accounts for inter segment transfers
at mutually agreed transfer prices.
(c) Allocation of Common Costs :
Common allocable costs are allocated to each
segment on case to case basis applying the ratio,
appropriate to each relevant case. Revenue and
expenses which relate to the enterprise as a whole
and are not allocable to segments on a reasonable
basis, are included under the head “Unallocated –
Common”.
The accounting policies adopted for segment
reporting are in line with those of the Company.
(xv) Fixed Assets Acquired under Lease :
(a) Finance Lease
Assets acquired under lease agreements which
effectively transfer to the company substantially all
the risk and benefits incidental to ownership of the
leased items, are capitalised at the lower of the fair
value and present value of minimum lease payment
at the inception of the lease term and disclosed
as leased assets. Lease payments are apportioned
between the finance charges and the reduction of
the lease liability so as to achieve a constant rate of
interest on the remaining balance of their liability.
SCHEDULE to the Balance Sheet and Profit & Loss Account (Contd.)SCHEDULE – 23 : ACCOUNTING POLICIES AND NOTES TO THE ACCOUNTS (Contd.)
The Oudh Sugar Mills Limited56
Finance charges are charged directly to the expenses
account.
(b) Operating Lease
Leases where the lessor effectively retains
substantially all the risks and benefits of the
ownership of the leased assets are classified as
operating leases. Operating lease payments are
recognised as an expense in the profit and loss
account.
(xvi) Share Issue Expenses :
Share issue expenses are adjusted against Securities
Premium Account.
(xvii) Earning per Share :
Basic Earning per Share is calculated by dividing the net
profit or loss for the year attributable to equity shareholders
by the weighted number of equity shares outstanding
during the year.
For the purpose of calculating diluted earning per share,
net profit or loss for the year attributable to equity share
holders and the weighted average number of shares
outstanding during the year are adjusted for the effect of
all dilutive potential equity shares.
(xviii) Excise Duty :
Excise Duty is accounted for at the point of manufacture
of goods and accordingly, is considered for valuation of
stocks as on the Balance Sheet date.
(xix) Hedging :
The company has adopted a policy to minimize risks
associated with foreign exchange fluctuations with respect
to its borrowings.
The premium or discount arising at the inception of forward
exchange contracts is amortised as expense or income over
the life of the contract.
(xx) Research Costs :
Research costs of revenue nature are expensed as and
when they are incurred, while capital expenditure is added
to the cost of the respective fixed assets.
(xxi) Cash and Cash equivalents :
Cash and cash equivalents in the cash flow statement comprise
of cash at bank and in hand and short-term investments with
an original maturity of three months or less.
(xxii) Provisions :
A provision is recognised when an enterprise has a present
obligation as a result of past event and it is probable that
an outflow of resources will be required to settle the
obligation, in respect of which a reliable estimate can be
made. Provisions made in terms of Accounting Standard 29
are not discounted to its present value and are determined
based on management estimate required to settle the
obligation, at the Balance Sheet date. These are reviewed
at each Balance Sheet date and adjusted to reflect the
current management estimates.
(xxiii) Derivative Instruments :
As per the announcement made by the Institute of
Chartered Accountants of India, Derivative contracts, other
than those covered under AS-11, are marked to market on
a portfolio basis, and the net loss after considering the
offsetting effect of the underlying hedged item is charged
to the income statement. Net gains are ignored as a matter
of prudence.
(xxiv) Contingencies :
Liabilities which are material and whose future outcome
cannot be ascertained with reasonable certainty are
treated as contingent and disclosed by way of notes to the
accounts.
SCHEDULE to the Balance Sheet and Profit & Loss Account (Contd.)SCHEDULE – 23 : ACCOUNTING POLICIES AND NOTES TO THE ACCOUNTS (Contd.)
Annual Report 2008-09 FINANCIAL STATEMENTS 57
(Rs. in Lakhs)
As at 30th
June, 2009
As at 30th
June, 2008
2. Estimated amount of contracts remaining to be executed on Capital Account
(net of advances) and not provided for
1,371.16 8,186.52
3. Contingent Liabilities not provided for in respect of :–
(a) Demands / Claims by various Government Authorities and others
not acknowledged as debts:
(i) Excise Duty & Service Tax 705.71 773.85
(ii) Sales & Entry Tax 156.41 241.52
(iii) Duty under State Acts 230.18 155.05
(iv) Others 28.16 36.12
Total 1,120.46 1,206.54
(b) (i) Guarantees given to a bank against loans to cane growers 4,000.00 3,000.00
(ii) Against the above, the loan facilities actually availed as on the Balance Sheet date 3,047.93 2,350.22
(c) Unredeemed bank guarantees 0.96 0.96
(d) Bills discounted with banks [since realised Rs. 81.00 Lakhs (Rs. 49.26 Lakhs)] 176.00 66.54
4. Excise Duty & Cess on stocks represents differential excise
duty and cess on opening and closing stock of finished goods
/ by products.
5. Pending disposal of writs / appeals by the court with regard
to levy sugar prices for some years, Rs. 79.41 Lakhs (Rs. 79.41
Lakhs) (net) received as excess levy sugar price, against which
bank guarantees furnished by the Company for Rs. 84.88
Lakhs, are in force in terms of the Court Orders, is included
under the head ‘Current Liabilities’. Necessary adjustment
for the above amount together with interest, if any, in this
regard will be made in the accounts as and when the matter
will be finally settled.
6. Pending decisions of various courts on writ petitions filed
by / against the Company, no credit has been taken in the
Profit and Loss Account in respect of certain realisations
aggregating to Rs. 52.05 Lakhs in earlier years, which
continue to be shown under the head “Liabilities for other
Finance” in Schedule – 12. Against the above, fixed deposit
receipts / bank guarantees for similar amount have been
furnished by the Company.
7. In view of the interim order dated 8th September, 2008 of
the Hon’ble Supreme Court, the Company for its Hargaon
and Rosa Sugar units in Uttar Pradesh has continued the
provision towards Sugarcane purchases made during the year
2007-08 @ Rs. 110 per quintal as against the State Advised
Price (SAP) of Rs. 125 per quintal. Pending final decision by
the Hon’ble Supreme Court in this matter, the differential
price of Rs. 2,422.74 Lakhs between SAP and the amount
already provided, as stated above, has not been accounted
for.
(Rs. in Lakhs)
As at 30th
June, 2009
As at 30th
June, 2008(A) Deferred Tax Liability
(i) Timing difference in depreciable assets 6,557.38 5,344.786,557.38 5,344.78
(B) Deferred Tax Asset(i) Carry forward unabsorbed depreciation 5,188.26 4,659.60(ii) Expenses allowable against taxable income in future years 739.03 1,117.42
5,927.29 5,777.02Net Deferred Tax Liability / (Asset) ( A – B ) 630.09 (432.24)
SCHEDULE to the Balance Sheet and Profit & Loss Account (Contd.)SCHEDULE – 23 : ACCOUNTING POLICIES AND NOTES TO THE ACCOUNTS (Contd.)
8. a) The break-up of net Deferred Tax Liability as on 30th June, 2009 is as under:
The Oudh Sugar Mills Limited58
b) Minimum Alternate Tax (MAT) credit entitlement of Rs.
836.59 Lakhs (Rs. 717.57 Lakhs), being available as tax
credit for set off in future years as per the Income Tax
Act, 1961, is carried forward for future adjustments
based on future profitability projections.
9. a) Pending execution of the conveyance deed, no
adjustment has been made in respect of 0.75 acre
of land sold by the Company in earlier years.
b) An application filed by the Company for exemption of
3785.19 sq. mtrs. of land at Bamrauli under the Urban
Land (Ceiling and Regulation) Act, 1976, is pending
with the concerned authority.
10. A civil suit is pending against the Company’s sugar unit at
Dhadha Bujurg (Hata), which is already in operation. The
Company has been legally advised that the said civil suit is
not tenable as per law.
(Rs. in Lakhs)
2008-2009 2007-2008
(i) Principal amount remaining unpaid to any supplier at the end of accounting
year (including retention money against performance). 317.74 408.06
(ii) Interest due on above. 9.82 2.99
Total of (i) & (ii) 327.56 411.05
(iii) Amount of interest paid by the Company to the suppliers in terms of section 16
of the Act. - -
(iv) Amount paid to the suppliers beyond the respective due date. 106.93 105.52
(v) Amount of interest due and payable for the period of delay in payments (which
have been paid but beyond the due date during the year) but without adding
the interest specified under the Act. 5.31 4.92
(vi) Amount of interest accrued and remaining unpaid at the end of accounting year. 15.13 7.91
(vii) Amount of further interest remaining due and payable even in the succeeding
years, until such date when the interest dues as above are actually paid to the
small enterprise, for the purpose of disallowance as a deductible expenditure
under section 23 of this Act. 10.04 -
SCHEDULE to the Balance Sheet and Profit & Loss Account (Contd.)SCHEDULE – 23 : ACCOUNTING POLICIES AND NOTES TO THE ACCOUNTS (Contd.)
11. Based on the information / documents available with the Company, information as per the requirement of Section 22 of The Micro,
Small and Medium Enterprises Development Act, 2006 are as under:
12. (a) The Company has a defined benefit gratuity plan. Every employee who has completed five years or more of service is entitled
to Gratuity on terms as per provisions of The Payment of Gratuity Act, 1972. The Company has got an approved gratuity fund
which has taken an insurance policy with Life Insurance Corporation of India (LIC) to cover the gratuity liabilities.
Annual Report 2008-09 FINANCIAL STATEMENTS 59
(Rs. in Lakhs)
2008-09 2007-08
(i) Net Employee Expense /(benefit)
Current service cost 49.45 47.16
Interest cost on benefit obligation 54.19 51.17
Expected return on plan assets (53.23) (45.70)
Net Actuarial Loss (Gain) recognised in the year (41.26) 16.54
Total employer expense 9.15* 69.17
* including Rs. 1.43 Lakhs (Rs. 0.53 Lakh) capitalised as pre-operative expenses
in Schedule-5
(ii) Actual return on plan assets 155.39 47.45
(iii) Benefit Asset / (Liability)
Fair Value of Plan Assets 840.81 628.78
Defined benefit obligation 802.93 699.59
Benefit Asset / (Liability) 37.88 (70.81)
(iv) Movement in benefit liability
Opening defined benefit obligation 699.59 665.13
Interest cost 54.19 51.17
Current service cost 49.45 47.16
Benefits paid (61.20) (82.16)
Actuarial (gains) / losses on obligation 60.90 18.29
Closing benefit obligation 802.93 699.59
(v) Movement in fair value of plan assets
Opening fair value of plan assets 628.78 533.36
Expected Return on plan assets 53.23 45.70
Contribution by employer 117.84 130.13
Benefits paid (61.20) (82.16)
Actuarial gains / (losses) on obligation 102.16 1.75
Closing fair value of plan assets 840.81 628.78
(vi) The major categories of plan assets as a percentage of the fair value of
total plan assets
Funded with insurer 100% 100%
(vii) The Principal actuarial assumptions are as follows:
Discount rate 7.6% 8.1%
Expected Return on plan assets 8.1% 8.5%
Salary Increase 5% 5%
Withdrawal rates Varying between 1% to 7% per annum
depending upon the duration and age of the
employees
The overall expected rate of return on assets is assumed to be 8.10% per annum as at 1st July, 2008 i.e. the same as discount
rate as at 30th June, 2008 because the assets are primarily invested in Government Bonds.
SCHEDULE to the Balance Sheet and Profit & Loss Account (Contd.)SCHEDULE – 23 : ACCOUNTING POLICIES AND NOTES TO THE ACCOUNTS (Contd.)
The following tables summarize the components of net benefit expenses recognised in the Profit & Loss Account and the funded
status and amounts recognised in the balance sheet for gratuity.
The Oudh Sugar Mills Limited60
(viii) Amount incurred as expense for defined contribution to
Provident / Pension fund plan Rs. 222.04 Lakhs (Rs. 214.62
Lakhs) [including Rs. 12.11 Lakhs (Rs. 6.19 Lakhs) capitalised
as pre-operative expenses in Schedule-5].
(Rs. in Lakhs)
2008-09 2007-08
(xi) The details for the current and previous year are as follows :
Defined Benefit Obligation 802.93 699.59
Plan Assets 840.81 628.78
Surplus / (Deficit) 37.88 (70.81)
Experience adjustments on plan liabilities Not Available*
Experience adjustments on plan assets Not Available*
* The management has relied on the overall actuarial valuation conducted by the actuary. However, experience adjustments on
plan liabilities and assets are not readily available and hence not disclosed.
(Rs. in Lakhs)
2008-2009 2007-2008
Salaries & Wages 490.38 580.49
Stores and Spares, etc. 1,083.96 1,171.85
Insurance 0.20 0.42
15. Earning per Share (EPS) :
In terms of Accounting Standard - 20, the calculation of EPS is given below:
Profit / (Loss) as per Profit & Loss Account (Rs. in Lakhs) 1,917.38 (451.27)
Weighted average number of Equity Shares outstanding during the year (Rs. 10 each) 2,05,29,746 1,81,73,820
Basic and Diluted earnings per share (Rs.) 9.34 (2.48)
The impact of diluted shares, if any, arising out of the exercise of detachable warrants as indicated in Note no. 13 above, has not
been considered for the computation of EPS, since the quantum of such dilutive option is not presently ascertainable.
SCHEDULE to the Balance Sheet and Profit & Loss Account (Contd.)SCHEDULE – 23 : ACCOUNTING POLICIES AND NOTES TO THE ACCOUNTS (Contd.)
(ix) The estimates of future salary increases considered in
actuarial valuation, take account of inflation, seniority,
promotion and other relevant factors, such as supply and
demand in the employment market.
(x) The Company expects to contribute Rs. 120 Lakhs to
Gratuity fund in 2009-2010.
Rs. 10 each for each warrant held on the date to be declared by the Company during the warrant exercise period between 12th March, 2009 to 11th September, 2012 at a price to be determined in the manner as indicated in the Letter of Offer.
(c) Rights Shares Issue expenses include Rs. 22.00 Lakhs paid to the Statutory Auditors.
14. (a) Salaries and Wages relating to various repairs have not been charged separately to the repairs, as the amount thereof has not been demarcated.
(b) Consumption of raw materials, stores, spare parts and packing materials includes profit/loss on sale thereof.
(c) The following items are included under other heads
of expenses in the Profit & Loss Account :
(b) Gratuity amount appearing in schedule 19 is after
adjustment of surplus of Rs. 37.88 Lakhs as indicated
above, being the excess of plan assets over the actuarial
liability as on the balance sheet date.
13. (a) The company has raised Rs. 2,323.01 Lakhs (including securities premium Rs. 1,935.84 Lakhs) by issue of equity shares of Rs. 10 each at a premium of Rs. 50 per equity share on Rights basis during the year and has utilised the proceeds of the issue for repayment of a part of the working capital borrowings as well as expenses incurred on such rights issue.
(b) In addition to equity shares allotted on rights basis, as stated above 39,98,240 detachable warrants were also allotted to the shareholders in terms of the said rightsissue entitling them to apply for one equity share of
Annual Report 2008-09 FINANCIAL STATEMENTS 61
16. Operating lease :
Certain office premises, godowns, etc. are obtained on operating lease. The lease term is for 1-3 years and renewable for further
period either mutually or at the option of the Company. There is no escalation clause in the lease agreement. There are no restrictions
imposed by lease agreements. There are no subleases. The leases are cancellable.(Rs. in Lakhs)
Particulars 2008-2009 2007-2008
Lease payments made for the year 79.24 76.04
Contingent rent recognised in the profit and loss account Nil Nil
17. The movements in provision for warranties during the year are as follows: -
(Rs. in Lakhs)
Balance as at
01.07.2008
Additions during
the year
Amount used during
the year
Balance as at
30.06.2009
Warranties 8.12 5.78 6.79 7.11
SCHEDULE to the Balance Sheet and Profit & Loss Account (Contd.)SCHEDULE – 23 : ACCOUNTING POLICIES AND NOTES TO THE ACCOUNTS (Contd.)
18. The Company’s segment information as at and for the year ended 30th June, 2009 are as below:
(Rs. in Lakhs)
Sugar SpiritsCo-
generation
Food
processingOthers Total
(a) Revenue (net of excise duty and cess)External Sales 47,537.74 5,017.13 587.06 2,507.44 - 55,649.37
(25,839.51) (4,677.10) (725.57) (1,913.72) (-) (33,155.90)Inter-segment Sales 4,082.09 13.40 1,490.57 - - 5,586.06
(3,388.80) (18.10) (1661.37) (-) (-) (5,068.27)Total Revenue 51,619.83 5,030.53 2,077.63 2,507.44 - 61,235.43
(29,228.31) (4,695.20) (2,386.94) (1,913.72) (-) (38,224.17)(b) Results
Segment Results 7,907.55 -64.42 379.01 195.06 -0.02 8,417.18(1,761.34) (1,025.79) (553.10) (79.64) (-0.56) (3,419.31)
Unallocated expenses net of unallocated Income 470.86(368.41)
Operating Profit 7,946.32(3,050.90)
Interest & Finance Charges (net) 4,941.53(3,677.82)
Income, Wealth & Fringe Benefit Tax (net) 144.10(32.54)
MAT Credit Entitlement/(-) Reversal 119.02(-3.93)
Deferred Tax Charge/(Credit) 1,062.33(-212.12)
Net Profit/(-) Loss 1,917.38(-451.27)
(c) Total AssetsSegment Assets 70,788.27 13,664.38 6,051.99 1,176.18 1.41 91,682.23
(73,144.09) (12,827.55) (6,488.18) (1,070.87) (1.45) (93,532.14)Unallocated Assets 2,902.58
(3,239.66)
94,584.81(96,771.80)
The Oudh Sugar Mills Limited62
SCHEDULE to the Balance Sheet and Profit & Loss Account (Contd.)SCHEDULE – 23 : ACCOUNTING POLICIES AND NOTES TO THE ACCOUNTS (Contd.)
Notes:
(i) Business Segment : The business segments have been identified on the basis of the products of the Company. Accordingly, the Company has identified “Sugar”, “Spirits”, “Co-generation” and “Food processing” as the operating segments :
Sugar - Consists of manufacture and sale of Sugar, Molasses & Bagasse.
Spirits - Consists of manufacture and sale of Industrial Spirits (including Denaturants), Fusel Oil & Bio Compost.
Co-generation - Consists of generation and transmission of Power.
Food Processing Products - Consists of Canned Fruits & Vegetables, Jams, Jellies, Squashes & Juices.
Others – Consist of Miscellaneous business comprising of less than 10% revenues.
(ii) Geographical Segment : The Company primarily operates in India and therefore the analysis of geographical segment is demarcated into its Indian and Overseas Operations.
(iii) The Company has common fixed assets located in India for producing goods for domestic and overseas markets. Hence, separate figures for fixed assets / additions thereof cannot be furnished.
(e) Other Information
(i) Non cash expenses 4.02 - - - - 4.02
(6.55) (-) (-) (-) (-) (6.55)
(ii) Capital Expenditure 11,360.20 696.02 71.76 4.22 - 12,132.20
(11,898.40) (8,013.00) (310.51) (19.55) (-) (20,241.46)
(iii) Depreciation for the year 1,741.85 521.60 366.20 5.23 0.03 2,634.91
(1,731.03) (181.52) (314.39) (5.05) (0.03) (2,232.02)
(f) Geographical Segments
Revenue
Domestic 54,969.87
(32,851.00)
Overseas (Including through third party) 679.50
(304.90)
55,649.37
(33,155.90)
(d) Total Liabilities
Segment Liabilities 8,919.02 649.20 28.73 790.96 0.12 10,388.03
(9,386.30) (862.24) (41.03) (735.26) (0.15) (11,024.98)
Unallocated Liabilities 70,426.72
(75,663.40)
80,814.75
(86,688.38)
(Rs. in Lakhs)
Sugar SpiritsCo-
generation
Food
processingOthers Total
18. The Company’s segment information as at and for the year ended 30th June, 2009 are as below: (Contd.)
Annual Report 2008-09 FINANCIAL STATEMENTS 63
19. Related Party Disclosure :
(a) Names of the related parties :
Subsidiary Companies : Champaran Marketing Company Ltd.
OSM Investment & Trading Co. Ltd.
Hargaon Investment & Trading Co. Ltd.
Hargaon Properties Ltd.
Key Management Personnel : Mr. Chandra Shekhar Nopany – Chairman-cum-Managing Director
Mr. V. P. Singh – Executive President, Hargaon Unit
Mr. Chandra Mohan – Executive President, Narkatiaganj Unit
Mr. B. K. Malpani – Executive President, Rosa Unit
(From 12th September, 2008)
Mr. P. K. Saini – Executive President, Hata Unit
Mr. S. K. Premi – Executive President, Allahabad Unit
Mr. Sanjay Mukherjee – Company Secretary (Upto 28th February, 2009)
Mr. G. N. Pareek – Company Secretary (From 1st March, 2009)
Relatives of Key Management Personnel : Mrs. Nandini Nopany – Mother of Shri Chandra Shekhar Nopany
Enterprises owned or Upper Ganges Sugar & Industries Ltd.
significantly influenced by Sutlej Textiles & Industries Ltd.
Key Management Personnel SIL Investments Ltd.
and their relatives : SCM Investment & Trading Co. Ltd.
RTM Investment & Trading Co. Ltd.
Uttar Pradesh Trading Co. Ltd.
SCHEDULE to the Balance Sheet and Profit & Loss Account (Contd.)SCHEDULE – 23 : ACCOUNTING POLICIES AND NOTES TO THE ACCOUNTS (Contd.)
The Oudh Sugar Mills Limited64
(b) Aggregated Related Party Disclosures as at and for the year ended 30th June, 2009 (Rs. in Lakhs.)
Subsidiaries
Key
Management
Personnel
Relatives of
Key Management
Personnel
Enterprises owned by
Key Management
Personnel or their relatives TotalTransaction
Value
Balance
Outstanding
as on 30.06.
2009
Transaction
Value
Balance
Outstanding
as on 30.06.
2009
Transaction
Value
Balance
Outstanding
as on 30.06.
2009
Transaction
Value
Balance
Outstanding
as on 30.06.
2009
Transaction
Value
Balance
Outstanding
as on 30.06.
2009 Sale of Goods & Services Upper Ganges Sugar & Industries Ltd. - - - - - - 35.38 - 35.38 -
( - ) ( - ) ( - ) ( - ) ( - ) ( - ) (206.66) ( - ) (206.66) ( - ) Purchase of Goods & Services
Upper Ganges Sugar & Industries Ltd. - - - - - - 109.98 - 109.98 - ( - ) ( - ) ( - ) ( - ) ( - ) ( - ) (37.17) ( - ) (37.17) ( - )
Sale of Fixed Assets Upper Ganges Sugar & Industries Ltd. - - - - - - 21.76 - 21.76 -
( - ) ( - ) ( - ) ( - ) ( - ) ( - ) (130.66) ( - ) (130.66) ( - )
Purchase of Fixed Assets Upper Ganges Sugar & Industries Ltd. - - - - - - 11.61 - 11.61 -
( - ) ( - ) ( - ) ( - ) ( - ) ( - ) (96.11) ( - ) (96.11) ( - ) Interest Paid Sutlej Textiles & Industries Limited - - - - - - 149.24 - 149.24 -
( - ) ( - ) ( - ) (340.24) ( - ) (340.24) ( - ) SIL Investments Ltd. - - - - - - 73.28 - 73.28 -
( - ) ( - ) ( - ) ( - ) ( - ) ( - ) (184.91) ( - ) (184.91) ( - ) SCM Investment & Trading Co. Ltd. - - - - - - 432.32 - 432.32 -
( - ) ( - ) ( - ) ( - ) ( - ) ( - ) (172.05) ( - ) (172.05) ( - ) RTM Investment & Trading Co. Ltd. - - - - - - 620.88 - 620.88 -
( - ) ( - ) ( - ) ( - ) ( - ) ( - ) (186.85) ( - ) (186.85) ( - ) Loans/Intercorporate deposits repaid Champaran Marketing Company Ltd. 1.00 22.50 - - - - - - 1.00 22.50
(10.50) (32.50) ( - ) ( - ) ( - ) ( - ) ( - ) ( - ) (10.50) (32.50)OSM Investment & Trading Company Ltd. 25.75 - - - - - - - 25.75 -
(12.00) ( - ) ( - ) ( - ) ( - ) ( - ) ( - ) ( - ) (12.00) ( - ) Hargaon Investment & Trading Company Ltd. 50.75 - - - - - - - 50.75 -
(63.50) ( - ) ( - ) ( - ) ( - ) ( - ) ( - ) ( - ) (63.50) ( - ) Sutlej Textiles & Industries Limited - - - - - - 3,500.00 - 3,500.00 -
( - ) ( - ) ( - ) ( - ) ( - ) ( - ) (3,000.00) ( - ) (3,000.00) ( - ) SIL Investments Limited - - - - - - 1,675.00 - 1,675.00 -
( - ) ( - ) ( - ) ( - ) ( - ) ( - ) (250.00) ( - ) (250.00) ( - ) SCM Investment & Trading Co. Ltd. - - - - - - 855.00 - 855.00 -
( - ) ( - ) ( - ) ( - ) ( - ) ( - ) (300.00) ( - ) (300.00) ( - ) RTM Investment & Trading Co. Ltd. - - - - - - 4,060.00 - 4,060.00 -
( - ) ( - ) ( - ) ( - ) ( - ) ( - ) (2,150.00) ( - ) (2,150.00) ( - ) Loans/Intercorporate deposits Taken Champaran Marketing Company Ltd. 11.00 - - - - - - - 11.00 -
(17.50) ( - ) ( - ) ( - ) (-) (-) (-) (-) (17.50) ( - ) OSM Investment & Trading Company Ltd. 11.50 10.25 - - - - - - 11.50 10.25
(26.00) (24.50) ( - ) ( - ) ( - ) ( - ) ( - ) ( - ) (26.00) (24.50)Hargaon Investment & Trading Company Ltd. 23.25 113.00 - - - - - - 23.25 113.00
(115.00) (140.50) ( - ) ( - ) ( - ) ( - ) ( - ) ( - ) (115.00) (140.50)Sutlej Textiles & Industries Limited - - - - - - 500.00 - 500.00 -
( - ) ( - ) ( - ) ( - ) ( - ) ( - ) (4,000.00) (3,000.00) (4,000.00) (3,000.00)SIL Investments Limited - - - - - - 100.00 - 100.00 -
( - ) ( - ) ( - ) ( - ) ( - ) ( - ) (1,300.00) (1,575.00) (1,300.00) (1,575.00)SCM Investment & Trading Co. Ltd. - - - - - - 525.00 2,570.00 525.00 2,570.00
( - ) ( - ) ( - ) ( - ) ( - ) ( - ) (3,200.00) (2,900.00) (3,200.00) (2,900.00)RTM Investment & Trading Co. Ltd. - - - - - - 3,030.00 3,420.00 3,030.00 3,420.00
( - ) ( - ) ( - ) ( - ) ( - ) ( - ) (6,600.00) (4,450.00) (6,600.00) (4,450.00)Balance Outstanding (net) Debit/(-) Credit :Upper Ganges Sugar & Industries Ltd. - - - - - - - 52.59 - 52.59 ( - ) ( - ) ( - ) ( - ) ( - ) ( - ) ( - ) (-48.47) ( - ) (-48.47) RemunerationMr. V.P. Singh - - 27.22 0.79 - - - - 27.22 0.79
( - ) ( - ) (19.06) (1.18) ( - ) ( - ) ( - ) ( - ) (19.06) (1.18)Mr. Chandra Mohan - - 28.56 0.90 - - - - 28.56 0.90
( - ) ( - ) (17.41) (0.90) ( - ) ( - ) ( - ) ( - ) (17.41) (0.90)Mr. P.K. Saini - - 11.97 0.90 - - - - 11.97 0.90
( - ) ( - ) (9.61) (0.08) ( - ) ( - ) ( - ) ( - ) (9.61) (0.08)Mr. S.K.Premi - - 15.29 0.93 - - - - 15.29 0.93
( - ) ( - ) (12.43) (0.11) ( - ) ( - ) ( - ) ( - ) (12.43) (0.11)Mr. B.K. Malpani - - 9.77 1.00 - - - - 9.77 1.00
( - ) ( - ) ( - ) ( - ) ( - ) ( - ) ( - ) ( - ) ( - ) ( - ) Mr. Sanjay Mukherjee - - 8.33 - - - - - 8.33 -
( - ) ( - ) (5.58) (0.18) ( - ) ( - ) ( - ) ( - ) (5.58) (0.18)Mr. G.N. Pareek - - 3.14 - - - - - 3.14 -
( - ) ( - ) ( - ) ( - ) ( - ) ( - ) ( - ) ( - ) ( - ) ( - )
NOTE : Remuneration paid to Mr. C. S. Nopany, Chairman-cum-Managing Director, is disclosed in Schedule 21 to the Accounts.
SCHEDULE to the Balance Sheet and Profit & Loss Account (Contd.)SCHEDULE – 23 : ACCOUNTING POLICIES AND NOTES TO THE ACCOUNTS (Contd.)
Annual Report 2008-09 FINANCIAL STATEMENTS 65
20. Additional information pursuant to the provisions of Clause 3, 4C and 4D of Part II of Schedule VI of the Companies Act, 1956 (to the extent applicable) :
(i) Licensed and Installed capacity, production, stock & sales of goods produced/traded during the year :
(Rs. in Lakhs.)
Opening Stock Closing Stock (b) Sales (b) Purchase of
Finished Goods
Class of
Goods
Licensed
Capacity
Installed
Capacity
Unit Production Quantity Amount Quantity Amount Quantity Amount Quantity Amount
Sugar (Bagged) Not Applicable 28700 Qtls 1405576 1723521 (c) 24,586.64 622614 12,034.24 2504324 (d) 48,973.09 - -
(21700) (2350576) (1150827) (15,815.90) (1723521) (24,586.64) (1775979) (25,819.58) (–) (–)
Tonnes Crushing per day
Power (-do-) 25 Units 36824300 1569000 30.75 1379423 29.38 19197988 (e) 587.06 - -
(25) (52686105) (1525879) (24.72) (1569000) (30.75) (24592277) (725.56) (–) (–)
M.W.
Molasses (sent out) – – Qtls 720504 499652 (g) 1,380.39 267313 (g) 788.49 974581 (d) 377.22 - -
(—) (—) (1155055) (480684) (787.81) (499652) (1,380.39) (1142792) (584.84) (–) (–)
Spirit 48.00 48.00 Ltrs. 23339973 3621292 506.60 5246980 1,180.37 21692440 5,144.49 - -
(45.00) (45.00) (24548914) (3113781) (489.45) (3621292) (506.60) (23953502) (5,184.66) (–) (–)
Million Ltrs. Million Ltrs.
Bio Compost Not Applicable 335000 Qtls. 233378 82636 41.72 67789 31.19 248225 (d) 84.62 - -
(-do-) (335000) (180745) (62923) (26.38) (82636) (41.72) (140531) (46.45) (–) (–)
Fusel Oil — — Ltrs. 8,000 3,600 - 3,600 - 8,000 1.12 - -
(—) (—) (–) (3600) (–) (3600) (–) (–) (–) (–) (–)
Canned Fruits
&
Not Specified 10 Tonnes
per day
Tonnes 2793 1428 562.39 1259 565.39 3529 1,969.00 567 260.67
Vegetables (-do-) (-do-) (3134) (861) (339.58) (1428) (562.39) (2929) (1,452.15) (362) (145.74)
Jams, Jellies,
Squashes &
Not Specified 10 Tonnes
per day
Tonnes 1168 128 46.77 126 48.32 1170 537.32 - -
Juices (-do-) (-do-) (1,077) (176) (60.96) (128) (46.77) (1125) (461.18) (–) (–)
Baggasse — — Qtls. 2627434 (f) 195622 129.04 66563 64.36 2756493 (d) 620.89 - -
(—) (—) (3926557) (119215) (52.99) (195622) (129.04) (3850150) (944.90) (–) (–)
Sugar Hedging Rs. - - - - -
Transactions (net) (–) (–) (135.24) (–) (–)
Others Rs. 20.89 13.54 14.32
(21.46) (20.89) (39.03)
27,305.19 14,755.28 58,309.13 260.67
(17,619.25) (27,305.19) (35,393.59) (145.74)
Farm Produce Qtls. 28,376 - - - - 28,376 36.60
Sugarcane (27422) (—) (—) (—) (—) (27422) (27.92)
Cereals etc. Qtls. 933 120 1.65 113 1.40 940 9.23
(208) (114) (0.97) (120) (1.65) (202) (1.88)
Gardens & Dairy
Products
Qtls. 5.83
(5.09)* excludes standing crop 1.65 1.40 51.66
(0.97) (1.65) (34.89)
SCHEDULE to the Balance Sheet and Profit & Loss Account (Contd.)SCHEDULE – 23 : ACCOUNTING POLICIES AND NOTES TO THE ACCOUNTS (Contd.)
NOTES :(a) Licensed and installed capacities are as certified by the management and accepted as correct by the Auditors.(b) Quantitative figures of closing stock are shown after adjusting shortage / excess, evaporation loss, samples etc. Sales figures
are inclusive of excise duty.(c) Includes 2155 (1901) quintals lost due to reprocessing during the year.(d) Includes 10453 (21196) quintals of Sugar, 881608 (955181) quintals of Molasses, 2297726 (2737557) quintals of Bagasse and
53613 (90510) quintals of Bio-compost transferred / consumed departmentally.(e) After adjusting inter-transfers 14237297 (22540653) units, transmission loss 314788 (1136366) units and captive consumption
3263804 (4373688) units. (f) Includes Bagasse used in Co-generation but excludes the quantum used for other own consumption in sugar units.(g) Includes 76355 quintals of Sub-standard materials pending destruction, for which permission from excise authorities is
awaited.
The Oudh Sugar Mills Limited66
SCHEDULE to the Balance Sheet and Profit & Loss Account (Contd.)SCHEDULE – 23 : ACCOUNTING POLICIES AND NOTES TO THE ACCOUNTS (Contd.)
Class of Goods Quantity (in quintals) Rs. in LakhsSugarcane (crushed) 14783295 21,586.80
(23705967) (27,023.95)Raw Sugar 79755 1,325.53 (-) (-)Molasses 1066645 3,366.13
(1090459) (1,741.07)Bagasse 1722180 1,159.65
(2261070) (1,285.01)Fresh Fruits & Vegetables 39212 492.82
(39757) (484.26)Sugar 9746 198.57
(10310) (154.07)Press Mud 640410 50.80
(933367) (74.27)Total 28,180.30
(30,762.63)
Less : Inter unit transfer of own produced materials 3,749.72(2,460.80)
Net Consumption of raw materials 24,430.58(28,301.83)
(ii) Raw Materials Consumed (after adjusting sales and claims) :
Class of Goods Quantity (in quintals) Rs. in LakhsSugarcane (crushed) 145476 256.27
(-) (-)
NOTES :
(a) The above figures are after adjusting transit losses / shortages and include the quantity of materials produced during the process of manufacturing and consumed departmentally.
(b) The above figures are exclusive of following raw materials consumed as indicated in schedule 5 :
(Rs. in Lakhs)2008-2009 2007-2008
(iii) C.I.F. Value of Imports (including through canalizing agencies on invoice value) :Raw Sugar 1,648.13 -Stores, Chemicals and Spares etc. 534.08 461.77
(iv) Expenditure in Foreign Currency (On Cash Basis) :(a) Traveling 1.34 0.20(b) Selling Commission 16.37 36.60
(v) Earning in Foreign Exchange (On Cash Basis) :F O B value of Exports (including through third party) 633.34 287.19
(vi)
Break-up of consumption of Raw Materials and Stores, Spare – parts and Packing Material etc. (including debits to other heads of account and after adjusting sales and claims) :
Raw Materials* Stores, Chemicals, Spare Parts etc.*Rs. in Lakhs % Rs. in Lakhs %
Imported 1,205.73 4.94 346.64 9.93(as certified by the management) (—) (—) (438.04) (10.57)Indigenous 23,224.85 95.06 3,144.87 90.07
(28,301.83) (100) (3,704.47) (89.43)24,430.58 100.00 3,491.51 100.00
(28,301.83) (100.00) (4,142.51) (100.00)
* Includes shortages and excludes materials consumed as indicated in schedule 5.
21. Figures given in brackets are for the previous year and the same have been regrouped and / or rearranged, wherever necessary.
Signatories to Schedules - 1 to 23As per our report of even date. For S. R. BATLIBOI & CO.Chartered Accountants
Per R. K. AGRAWALPartnerMembership No. 16667 Place: Kolkata G. N. Pareek Chandra Shekhar Nopany Chairman - cum - Mg. Director Dated: 25th August, 2009 Company Secretary A. C. Dalal Director
Annual Report 2008-09 FINANCIAL STATEMENTS 67
I. Registration Details
CIN L15432UP1932PLC025186 State Code 20
Balance Sheet Date 30.06.2009
II. Capital Raised during the year(Amount in Rs. thousands)
Public Issue Nil Rights Issue 38717
Bonus Issue Nil Private Placement Nil
III. Position of Mobilisation and Deployment of Funds (Amount in Rs. thousands)
Total Liabilities 8370456 Total Assets 8370456
Sources of Funds
Paid-up Capital 220466 Secured Loans 5321261
Reserves & Surplus 1156540 Unsecured Loans 1609180
Deferred Tax Liability (net) 63009
Application of Funds
Net Fixed Assets 5444920 Net Current Assets 1385644
Capital Expenditure on New/ Expansion Projects 1431969 Miscellaneous Expenditure Nil
Investments 107923
IV. Performance of Company (Amount in Rs. thousands)
Turnover (including other income) 5593388 Total Expenditure 5292909
Profit before Tax 300479 Profit after Tax 191738
Earning Per Share (in Rs.) 9.34 Dividend Rate (Re.) 1.50
V. Generic Names of three Principal Products/Services of the Company : (as per monetary terms)
Item Code. No. 17011000 Item Code. No. 220710
Description Sugar Description Industrial Alcohol
Item Code. No. 200600
Description Canning Products
BALANCE SHEET ABSTRACT and company’s general business profile
G. N. Pareek A. C. Dalal Chandra Shekhar NopanyCompany Secretary Director Chairman - cum - Mg. Director
The Oudh Sugar Mills Limited68
AUDITORS’ REPORTon Consolidated Financial StatementsTo The Board of Directors ofThe Oudh Sugar Mills Limited
1. We have examined the attached Consolidated Balance Sheet of THE OUDH SUGAR MILLS LIMITED and its subsidiaries as at 30th June, 2009 and also the Consolidated Profit and Loss Account and the Consolidated Cash Flow Statement for the year ended on that date, annexed thereto. These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements based on our audit.
2. We conducted our audit in accordance with the auditing standards generally accepted in India. Those Standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatements. An audit includes, examining on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by the management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.
3. We have not audited the financial statements of the subsidiary companies, whose financial statements reflect total assets of Rs. 2,491.04 Lakhs as at 31st March, 2009 and total revenues of Rs. 46.21 Lakhs and net cash flow of Rs. (-) 0.78 Lakhs for the year then ended. These financial statements have been audited by other auditors whose reports have been furnished to us, and our opinion, in so far as it relates to the amounts included in respect of these subsidiaries, is based solely on the reports of other auditors as well as management certificate in respect of certain adjustments for the reasons as mentioned in Note No. 1(c) of Schedule - 23.
4. We report that the consolidated financial statements have been prepared by the Company in accordance with the requirements of Accounting Standard (AS) 21,”Consolidated Financial Statements” notified under the Companies Accounting Standards Rules, 2006.
5. Without qualifying our opinion, we draw attention to Note No. 8 on Schedule 23, regarding accounting of Sugarcane purchases at Hargaon & Rosa Sugar units in Uttar Pradesh @ Rs. 110 per quintal for sugar season 2007-2008 as against the State Advised Price (SAP) of Rs. 125 per quintal in view of the interim order dated 8th September, 2008 of the Hon’ble Supreme Court. Since the matter is subjudice, the liability for differential price of Rs. 2,422.74 Lakhs is presently undeterminable and hence, no provision thereof has been made in the accounts.
6. Attention is drawn to the following notes on Schedule – 23 :
(a) Note Nos. 6 and 7 regarding non-adjustment of certain realisations in earlier years aggregating to Rs. 131.46 Lakhs (Previous Year Rs. 131.46 Lakhs) and non-provision of interest payable thereon, if any, in case of refund of such realisations. As the matters are under adjudication / not yet settled, the impact of above non-adjustment on the Company’s profit is not presently ascertainable;
(b) Note No. 10(b) regarding recognition of Minimum Alternative Tax (MAT) credit entitlement of Rs. 836.59 Lakhs upto the Balance Sheet date based on the future profitability projections made by the management. However, we are unable to express any opinion on the above projections and their consequent impact, if any, on such recognition of MAT Credit Entitlement. Had the impact of above been considered, there would be a profit of Rs. 1,123.82 Lakhs as against the reported profit of Rs. 1,960.41 Lakhs for the year and the figures of Reserves & Surplus would be Rs. 12,089.43 Lakhs as against the reported figures of Rs. 12,926.02 Lakhs. In respect of the above items, the previous year’s audit report was similarly modified.
7. Based on our audit and on consideration of reports of other auditors on separate financial statements and on the other financial information of the components, and to the best of our information and according to the explanations given to us, we are of the opinion that the attached consolidated financial statements, subject to the matters stated in para 6 above, give a true and fair view in conformity with the accounting principles generally accepted in India :
(a) in the case of Consolidated Balance Sheet, of the consolidated state of affairs of The Oudh Sugar Mills Limited and its subsidiaries as at 30th June, 2009;
(b) in the case of Consolidated Profit & Loss Account, of the consolidated profit of The Oudh Sugar Mills Limited and its subsidiaries for the year then ended and
(c) in the case of Consolidated Cash Flow Statement, of the consolidated cash flows of The Oudh Sugar Mills Limited and its subsidiaries for the year then ended.
For S. R. BATLIBOI & CO. Chartered Accountants
Per R. K. AGRAWALPlace: Kolkata PartnerDated: 25th August, 2009 Membership No. 16667
Annual Report 2008-09 FINANCIAL STATEMENTS 69
(Rs. in Lakhs)
Schedule 30th June, 2009 30th June, 2008
SOURCES OF FUNDS
A. Shareholders’ Funds
(a) Share Capital 1 2,204.66 1,817.49
(b) Reserves & Surplus 2 12,926.02 9,583.52
15,130.68 11,401.01
B. Loan Funds 3
(a) Secured 53,212.61 54,868.78
(b) Unsecured 15,968.55 20,541.75
69,181.16 75,410.53
C. Deferred Tax Liability (net) 630.09 -
84,941.93 86,811.54
APPLICATION OF FUNDS
A. Fixed Assets 4
(a) Gross Block 71,840.50 48,709.12
(b) Less: Accumulated Depreciation 17,493.15 15,174.12
(c) Net Block 54,347.35 33,535.00
(d) Capital Work- in- Progress 209.90 340.80
(e) Capital Expenditure on New / Expansion Projects 5 14,319.69 25,677.31
68,876.94 59,553.11
B. Investments 6 2,229.21 2,154.44
C. Deferred Tax Asset (net) - 432.24
D. Current Assets, Loans & Advances
(a) Inventories 7 17,380.17 29,039.82
(b) Sundry Debtors 8 775.32 648.39
(c) Cash & Bank Balances 9 521.63 423.92
(d) Other Current Assets 10 9.02 4.55
(e) Loans & Advances 11 6,030.14 5,667.99
24,716.28 35,784.67
E. Less: Current Liabilities & Provisions 12
(a) Current Liabilities 10,335.08 10,953.99
(b) Provisions 545.42 159.06
10,880.50 11,113.05
Net Current Assets 13,835.78 24,671.62
F. Miscellaneous Expenditure
(to the extent not written off or adjusted) - 0.13
84,941.93 86,811.54
Accounting Policies and Notes to Accounts 23
Schedules referred to above form an integral part of the Consolidated Balance Sheet.
CONSOLIDATED BALANCE SHEETof The Oudh Sugar Mills Limited and its Subsidiary Companies as at 30th June, 2009
As per our report of even date. For S. R. BATLIBOI & CO.Chartered Accountants
Per R. K. AGRAWALPartnerMembership No. 16667 Place: Kolkata G. N. Pareek Chandra Shekhar Nopany Chairman - cum - Mg. DirectorDated: 25th August, 2009 Company Secretary A. C. Dalal Director
The Oudh Sugar Mills Limited (Consolidated)70
(Rs. in Lakhs)Schedule 2008-2009 2007-2008
INCOMEGross Sales 13 58,309.13 35,393.59 Less : Excise Duty 2,085.46 1,926.61 : Cess 574.30 2,659.76 311.08 2,237.69 Net Sales 55,649.37 33,155.90 Other Income 14 330.73 1,134.08
55,980.10 34,289.98 EXPENDITURE
Decrease / (Increase) in Stocks 15 12,606.43 (9,630.41)Excise Duty & Cess on Stocks (1,242.30) 574.12 (Refer note no. 5 on Schedule 23)Agricultural Loss 16 21.48 25.99 Purchase of Finished Goods 260.67 145.74 Raw Materials Consumed 17 24,430.58 28,301.83 Stores, Spares & Packing Materials Consumed 18 2,406.05 2,970.39 Fuel & Electricity 700.89 536.86 Payments to and Provisions for Employees 19 2,928.36 2,887.82 Manufacturing, Selling and Other Expenses 20 3,199.56 3,043.27 Directors’ Remuneration 21 47.02 48.57
45,358.74 28,904.18 Profit before Interest, Depreciation & Taxation 10,621.36 5,385.80 Less : Interest & Finance Charges (net) 22 4,941.53 3,677.81 Depreciation 2,632.03 2,229.68
7,573.56 5,907.49 Profit / (Loss) before Taxation 3,047.80 (521.69)Provision for Taxation:Current Tax [including wealth tax Rs. 3.00 Lakhs (Rs. 3.00 Lakhs)] 122.02 3.12 Deferred Tax charge / (credit) 1,062.33 (212.12)Minimum Alternative Tax Credit (Entitlement) / Reversal (119.02) 3.93 Provision for Income Tax no longer required written back 1.69 0.60 Provision for Fringe Benefit Tax 23.75 30.14 Profit / (Loss) after Taxation 1,960.41 (346.16)Surplus brought forward from previous year 743.38 610.69 Transfer from General Reserve - 500.00 Balance Available for Appropriation 2,703.79 764.53 Appropriations :-Transfer to Reserve fund 8.89 21.15 Transfer to General Reserve 100.00 - Proposed dividend on Equity Shares 328.79 - Tax on Dividend 55.88 - Balance carried to Balance Sheet 2,210.23 743.38
2,703.79 764.53 Earning per Share of Rs. 10 each (Basic and Diluted) (Rs.) 9.55 (1.90)(Refer note no. 18 on Schedule 23)
Accounting Policies and Notes to Accounts 23
Schedules referred to above form an integral part of the Consolidated Profit & Loss Account.
CONSOLIDATED PROFIT & LOSS ACCOUNTof The Oudh Sugar Mills Limited and its Subsidiary Companies for the year ended 30th June, 2009
As per our report of even date. For S. R. BATLIBOI & CO.Chartered Accountants
Per R. K. AGRAWALPartnerMembership No. 16667 Place: Kolkata G. N. Pareek Chandra Shekhar Nopany Chairman - cum - Mg. Director Dated: 25th August, 2009 Company Secretary A. C. Dalal Director
Annual Report 2008-09 FINANCIAL STATEMENTS 71
CONSOLIDATED CASH FLOW STATEMENTof The Oudh Sugar Mills Limited and its Subsidiary Companies for the year ended 30th June, 2009
(Rs. in Lakhs)2008-2009 2007-2008
A. CASH FLOW FROM OPERATING ACTIVITIES :Profit / (Loss) before Tax 3,047.80 (521.69)
Adjustments for :Depreciation 2,634.91 2,232.02 Interest & Finance Charges (net of capitalisation & Subsidy) 5,120.35 3,717.39 Molasses Storage and Maintenance Reserve 4.02 6.55 (Profit) / Loss on Fixed Assets sold / discarded (21.38) (66.42)(Profit) on sale of Long Term Investments - (15.31)Interest & Dividend Income (225.08) (148.01)Preliminary Expenses written off 0.13 0.13 Bad Debts, irrecoverable claims & advances written off 29.03 11.97 Provision for Warranties & Claims 5.78 6.86 Provision for diminution in the value of investments written back - (0.25)Provision for bad and doubtful debts / advances (net) 101.31 52.50
Operating Profit before Working Capital Changes : 10,696.87 5,275.74 Adjustments for :
Decrease in Trade Payables (748.85) (4,290.74)Increase in Trade & Other Receivables (324.07) (2,310.34)Decrease / (Increase) in Inventories 11,659.65 (9,565.96)
10,586.73 (16,167.04)Cash Generated from Operations : 21,283.60 (10,891.30)
Direct Taxes Refund / (Paid) 51.42 (41.01)Net Cash from Operating Activities 21,335.02 (10,932.31)
B. CASH FLOW FROM INVESTING ACTIVITIES :Sale of Fixed Assets 194.84 201.77 Capital Subsidy 142.18 200.83 Sale of Investments 0.23 16.62 Loans Given 10.42 (5.56)Interest Received 174.35 38.58 Dividend Received 46.26 108.42 Purchase of Investments (75.00) (31.90)Fixed deposits (173.16) (1.30)Purchase of Fixed Assets (8,600.88) (17,747.44)
Net Cash used in Investing Activities (8,280.76) (17,219.98)C. CASH FLOW FROM FINANCING ACTIVITIES :
Proceeds from Borrowings 10,243.17 45,725.89 Repayment of Loans (16,931.24) (11,304.12)Rights issue of Shares 387.17 - Share Premium on rights issue of shares 1,935.84 - Rights Shares Issue Expenses (173.10) - Interest & Finance charges Paid (net of subsidy) (8,591.45) (6,358.51)Dividend Paid (including dividend tax) (0.10) (1.96)
Net Cash from Financing Activities (13,129.71) 28,061.30 NET CHANGES IN CASH & CASH EQUIVALENTS (A+B+C) (75.45) (90.99)*Cash & Cash equivalents - Opening Balance 367.42 458.41 *Cash & Cash equivalents - Closing Balance 291.97 367.42
*Represents Cash and Bank balances as indicated in Schedule - 9 , and excludes Rs. 229.66 Lakhs (Rs. 56.50 Lakhs) being bank balances
with restricted use or with maturity of more than three months.
As per our report of even date. For S. R. BATLIBOI & CO.Chartered Accountants
Per R. K. AGRAWALPartnerMembership No. 16667 Place: Kolkata G. N. Pareek Chandra Shekhar Nopany Chairman - cum - Mg. DirectorDated: 25th August, 2009 Company Secretary A. C. Dalal Director
The Oudh Sugar Mills Limited (Consolidated)72
SCHEDULES forming part of the Consolidated Balance Sheet
(Rs. in Lakhs)
30th June, 2009 30th June, 2008
SCHEDULE - 1 : SHARE CAPITAL
Authorised :
4,00,00,000 Equity Shares of Rs. 10 each 4,000.00 4,000.00
Issued :
2,21,72,060 (1,81,73,820) Equity Shares of Rs. 10 each 2,217.21 1,817.38
1,883 1/2 Equity Shares of Rs. 100 each 1.89 1.89
2,219.10 1,819.27
Subscribed & Paid-up :
2,19,18,935 (1,81,73,820) Equity Shares of Rs. 10 each fully paid 2,191.89 1,817.38
44 Quarter Equity Shares of Rs. 25 each fully paid 0.01 0.01
Bearer Equity Share Coupons of Rs. 25 and Rs. 12.50 each fully paid 0.06 0.06
2,191.96 1,817.45
Add : Forfeited Shares (amount originally paid-up) 12.70 0.04
2,204.66 1,817.49
Note :
Out of the above 6,11,550 Equity Shares have been issued for consideration other than cash and 11,55,575 Equity Shares have been
allotted as Bonus Shares by capitalisation of Securities Premium and General Reserve.
SCHEDULE - 2 : RESERVES & SURPLUS Capital Reserve :
As per last Account 198.59* 198.59* * Includes Rs. 2.71 Lakhs arisen on consolidation
Capital Redemption Reserve :As per last Account 82.69 82.69
Securities Premium :As per last Account 6,247.67 6,247.67 Add : Received on Rights Shares issued 1,935.84 -
8,183.51 6,247.67 Less : Adjustment of Rights Shares issue expenses 173.10 -
8,010.41 6,247.67 Reserve Fund:
As per last Account 280.69 259.54 Add : Transfer from Profit & Loss Account 8.89 21.15
289.58 280.69 General Reserve :
As per last Account 1,949.62 2,524.50 Add : Transfer from Profit & Loss Account 100.00 - Less : Impact of Revised AS-15 as on 1st July, 2007 (Net of Tax) - 74.88 : Transfer to Profit & Loss Account - 500.00
2,049.62 1,949.62 Molasses & Alcohol Storage and Maintenance Reserve :
As per last Account 78.04 71.49 Add : Provided during the year 4.02 6.55
82.06 78.04 Effluent Disposal Reserve :
As per last Account 2.84 2.84 Surplus as per Profit & Loss Account 2,210.23 743.38
12,926.02 9,583.52
Annual Report 2008-09 FINANCIAL STATEMENTS 73
SCHEDULES forming part of the Consolidated Balance Sheet (Contd.)
(Rs. in Lakhs)
30th June, 2009 30th June, 2008
SCHEDULE - 3 : LOAN FUNDS
A. Secured Loans :
Term Loans
Long Term
From Scheduled Bank(s) :
Under Project Finance Loan Scheme 30,497.23 24,572.42
Under Financial Assistance Scheme (Excise Duty Loan) 3,985.00 3,985.00
Interest accrued & due 799.05 254.50
From Sugar Development Fund 5,334.05 5,207.86
From a Body Corporate 1,200.00 2,400.00
Short Term
From a Scheduled Bank 2,100.00 1,000.00
From a Body Corporate - 1,000.00
Other Loans
From a Scheduled Bank on Cash Credit Account 9,297.28 16,449.00
53,212.61 54,868.78
B. Unsecured Loans :
Short Term Loan from a Scheduled Bank - 1,000.00
From State Bank of India against Crop Loan to Canegrowers 2,560.34 2,215.21
Inter Corporate Loans 13,010.00 16,919.00
Fixed Deposits from Staff and Others 306.29 308.39
Trade and other Deposits (partly not bearing interest) 91.92 99.15
15,968.55 20,541.75
69,181.16 75,410.53
Notes :
1 Term loans from Scheduled Bank(s) (except Excise Duty Loan) and from a Body Corporate are secured by first mortgage / charge on all the immovable and movable assets (save and except book debts), present and future, of the Company’s Sugar Units at Hargaon, Rosa, Narkatiaganj and Dhadha Bujurg (Hata) and Distillery Unit at Hargaon , ranking pari-passu amongst the various lenders, subject to prior charges created on movables for working capital borrowings from the Company’s bankers.
Term loans under Financial Assistance Scheme (Excise Duty Loan) are to be secured by a residual charge on the entire Fixed Assets (movable and immovable) of the Company’s Sugar Units at Hargaon, Rosa and Narkatiaganj.
2 Term loans from the Sugar Development Fund are secured by a second charge on all the immovable / movable assets (save and except book debts) present and future of the Company’s Sugar Units at Hargaon and Narkatiaganj and include Rs. 738.66 Lakhs(Rs. 824.51 Lakhs) towards interest which, as per stipulated terms, is payable on a long term basis.
3 a. Short term loan of Rs. 900 Lakhs (Rs. 1,000 Lakhs) from a Scheduled Bank / a Body Corporate is secured by the pledge of certain shares held as Investments.
b. Short term loan of Rs. 1200 Lakhs (Rs. Nil) from a Scheduled Bank is secured by first mortgage / charge on all the immovable and movable assets, present and future, of the Company’s Sugar Unit at Rosa, ranking pari-passu amongst the various lenders.
4 Cash Credit borrowings are secured by hypothecation of entire current assets of the Company and also by a charge on the immovable assets as follows :-
a. Canning factory at Allahabad - First Charge
b. Sugar Unit at Rosa - Second Charge
c. Sugar Units at Hargaon and Narkatiaganj - Third Charge
5 Unsecured loans, as stated above, include Rs. 15,653.92 Lakhs (Rs. 20,115.68 Lakhs) falling due for payment within one year.
The Oudh Sugar Mills Limited (Consolidated)74
SCHEDULES forming part of the Consolidated Balance Sheet (Contd.)
(Rs.
in L
akhs
)
SCH
EDU
LE -
4 :
FIXE
D AS
SETS
GRO
SS B
LOCK
DEP
RECI
ATIO
NN
ET B
LOCK
AS
AT
PART
ICU
LARS
Ope
ning
Bala
nce
as
at 1
st J
uly,
2008
Addi
tion
s
durin
g th
e
year
Ded
ucti
ons/
Adju
stm
ents
As a
t 30
th
June
,
2009
Ope
ning
Bala
nce
as a
t
1st
July
,
2008
For
the
year
Less
: On
Ded
ucti
ons/
Adju
stm
ents
Upt
o 30
th
June
,
2009
As a
t 30
th
June
,
2009
As a
t
30th
Jun
e,
2008
Free
Hol
d La
nd 4
34.7
8 1
,425
.85
0.0
2 1
,860
.61
(a)
-
-
-
-
1,8
60.6
1 4
34.7
8
Build
ings
3,2
53.7
7 1
,342
.91
-
4,5
96.6
8 4
88.9
8 8
5.62
-
5
74.6
0 4
,022
.08
2,7
64.7
9
Plan
t &
Mac
hine
ry 4
4,27
3.56
2
0,78
2.37
4
59.8
0 6
4,59
6.13
1
4,26
6.48
2
,493
.70
289
.54
16,
470.
64
48,
125.
49
30,
007.
08
Railw
ay S
idin
gs 1
.48
-
-
1.4
8 1
.41
-
-
1.4
1 0
.07
0.0
7
Mot
or C
ars,L
orrie
s &
Oth
er
Conv
eyan
ce 2
84.7
4 1
0.93
1
2.00
2
83.6
7 1
34.3
0 2
1.87
1
0.91
1
45.2
6 1
38.4
1 1
50.4
4
Furn
itur
e &
Fix
ture
s 4
58.1
1 5
8.66
1
4.84
5
01.9
3 2
80.2
7 3
3.72
1
2.75
3
01.2
4 2
00.6
9 1
77.8
4
Live
Sto
ck 2
.68
-
2.6
8 -
2
.68
-
2.6
8 -
-
-
48,
709.
12
23,
620.
72
489
.34
71,8
40.5
0 1
5,17
4.12
2
,634
.91
315
.88
17,
493.
15
54,
347.
35
33,
535.
00
Capi
tal W
ork-
in-P
rogr
ess
340
.80
248
.37
379
.27
209
.90
(b)
-
-
-
-
209
.90
340
.80
Tota
l 4
9,04
9.92
2
3,86
9.09
8
68.6
1 72
,050
.40
(c)
15,
174.
12
2,6
34.9
1 3
15.8
8 1
7,49
3.15
5
4,55
7.25
3
3,87
5.80
Tota
l-Pr
evio
us Y
ear
42,
052.
12
7,9
76.1
1 9
78.3
1 4
9,04
9.92
1
3,25
4.85
2
,232
.02
312
.75
15,
174.
12
33,
875.
80
NO
TES
:
(a)
Incl
udes
Rs.
3.46
Lak
hs b
eing
the
val
ue o
f ag
ricul
tura
l lan
d m
easu
ring
abou
t 38
39 a
cres
tog
ethe
r w
ith
esti
mat
ed w
ritte
n do
wn
valu
e of
imm
ovab
le a
sset
s th
ereo
n, t
aken
ove
r by
the
Gov
ernm
ent
of U
ttar
Pra
desh
und
er t
he U
.P. I
mpo
siti
on o
f Ce
iling
of
Land
Hol
ding
Act
,196
0, a
cas
e w
here
of is
pen
ding
in t
he c
ourt
.
(b)
Incl
udes
adv
ance
aga
inst
pur
chas
e of
fix
ed A
sset
s Rs
. 83.
85 L
akhs
(Rs.
112.
65 L
akhs
).
(c)
Incl
udes
ass
ets
held
in jo
int
owne
rshi
p w
ith
othe
rs R
s. 11
2.12
Lak
hs (R
s. 11
0.49
Lak
hs).
Annual Report 2008-09 FINANCIAL STATEMENTS 75
(Rs. in Lakhs)30th June,
2009
30th June,
2008SCHEDULE - 5 : CAPITAL EXPENDITURE ON NEW / EXPANSION PROJECTSA. Freehold Land 997.99 1,089.65 B. Fixed Assets
(1) Buildings 40.16 37.10 (2) Plant & Machinery 128.52 14.08 (3) Motor Cars, Lorries & Other Conveyance 1.17 1.17 (4) Furniture & Fixtures 71.67 49.39
241.52 101.74 Less : Depreciation (charged to Pre-operative expenses as below) 76.57 164.95 59.05 42.69
C. Machinery and Building under erection 27,171.02 24,194.44 D. Materials at site including goods in transit 224.81 1,277.06
[net of sales Rs. 175.36 Lakhs (Rs. 161.46 Lakhs)]E. Advances against purchase of fixed assets 1,234.97 2,336.15
29,793.74 28,939.99 Less : Transfer to Fixed Assets during the year 18,242.29 6,629.21
11,551.45 22,310.78 F. Incidental Expenditure (including during trial run period) pending
allocation to Fixed Assets :Amount brought forward from previous year 3,366.53 837.57 Add for the year :
Salaries,Wages,Bonus,etc 295.50 195.54 Contribution to Provident & Other Funds 12.32 6.22 Gratuity 1.43 0.53 Fuel & Electricity 246.51 156.00 Raw Materials Consumed 256.27 - Stores, Spares & Packing Materials consumed 40.18 - Project Consultancy / Supervision Charges 7.33 133.28 Insurance Charges 21.72 35.06 Miscellaneous Expenses [including Rs. 1.20 Lakhs (Rs. 1.50 Lakhs) paid 184.94 242.94 for various certificates to the Statutory Auditors]Interest & Other Financial Charges [including Rs. 2,105.55 Lakhs
(Rs. 1,005.61 Lakhs) on fixed loans] 3,442.48 2,362.35 Depreciation 17.52 45.68
7,892.73 4,015.17 Less : Closing Stocks :
Finished Goods 176.20 - By-Products 24.03 - Goods under Process 72.97 273.20 - -
7,619.53 4,015.17 Less : Capitalised / Allocated to Fixed Assets during the year 4,851.29 648.64
2,768.24 3,366.53 14,319.69 25,677.31
SCHEDULES forming part of the Consolidated Balance Sheet (Contd.)
The Oudh Sugar Mills Limited (Consolidated)76
(Rs. in Lakhs)
No. of Shares Face Value per
share (Rs.)
30th June,
200930th June, 2008
SCHEDULE - 6 : INVESTMENTSLong TermGovernment Securities :Quoted :
5 1/2 % U.P.State Development Loan,1977 - (c) -
5 1/2 % U.P.State Development Loan,1981 0.60 (d) 0.60
11 % Bihar State Development Loan, 2001 0.53 0.53
1.13 1.13 Unquoted :
12 Years National Savings Certificates 0.08 (d) 0.08
7 Years National Savings Certificates 0.02 (d) 0.02
6 Years National Savings Certificates 1.12 1.35
12 Years National Defence Certificates 0.04 (d) 0.04
12 Years National Plan Savings Certificates - (c) -
10 Years National Savings Certificates 0.01 (d) 0.01
7 Years National Defence Certificates - (c) -
1.27 1.50 Equity Shares (Fully Paid)Quoted :
SIL Investments Ltd. 1,758,125 10.00 396.04 396.04
Sutlej Textiles & Industries Ltd. 1,773,351 10.00 514.72 514.72
Upper Ganges Sugar & Industries Ltd. 1,172,260 10.00 867.44 867.44
New India Retailing & Investment Ltd. 266,874 10.00 212.63 212.63
Chambal Fertilizers & Chemicals Ltd. 302,500 10.00 55.00 55.00
Manavta Holdings Ltd. 72,000 10.00 3.53 3.53
Manbhawani Investment Ltd. 67,500 10.00 2.07 2.07
2,051.43 2,051.43 Unquoted :
Bihar State Financial Corporation Ltd. 70 100.00 0.07 0.07
Modern DiaGen Services Ltd. 23,752 10.00 2.38 2.38
Taparia Ltd. 3,500 10.00 0.40 0.40
Shree Vihar Properties Ltd. 747,692 10.00 65.77 65.77
India Educational & Research Inst. Pvt. Ltd. 4,900 10.00 0.49 0.49
Moon Corporation Ltd. (‘A’ Class) 745 100.00 0.77 0.77
Moon Corporation Ltd. (‘B’ Class) 2,502 5.00 0.13 0.13
Birla Buildings Ltd. 1,920 10.00 0.19 0.19
The Oudh Trading Co. Pvt. Ltd. 25 100.00 0.03 0.03
A.P.V. Texmaco Ltd. (in liquidation) 28,750 10.00 0.86 (d) 0.86
Leas Communication Ltd. 21,000 10.00 - -
Chandausi Rice Mills Ltd. 1,000 10.00 - -
Swadeshi Jute Machinery Corporation Ltd. 15,000 10.00 - -
Maruti Ltd. (In liquidation) 10,000 10.00 - -
Jai Hind Publishing Co.Ltd. (in liquidation) 80 25.00 - -
Akhil Bharat Printers Ltd. (in liquidation) 150 100.00 - -
Indo International Distillers Association Pvt. Ltd. 54,000 * 10.00 5.40 (d) 5.40
76.49 76.49
SCHEDULES forming part of the Consolidated Balance Sheet (Contd.)
Annual Report 2008-09 FINANCIAL STATEMENTS 77
(Rs. in Lakhs)
30th June, 2009 30th June, 2008
Book Value Market Value Book Value Market Value
Aggregate Value Of Investments :
Book Value
Quoted 2,051.96 3,461.39 2,051.96 3,754.53
Unquoted 177.25 102.48
2,229.21 2,154.44
SCHEDULES forming part of the Consolidated Balance Sheet (Contd.)
(Rs. in Lakhs)
No. of
Shares
Face Value per
share (Rs.)30th June, 2009 30th June, 2008
SCHEDULE - 6 : INVESTMENTS (Contd.)Equity Shares (Partly Paid)Unquoted :
Modern DiaGen Services Ltd. (Rs. 2 paid up) 1,545,044 10.00 30.90 30.90
Preference Shares (Fully Paid) 8% Non - Convertible Cumulative Redeemable Preference
Shares of New India Retailing & Investments Ltd. 75,000 100 75.00 -
(-) Other Investments
Share Application Money :
Indo International Distillers Association Pvt. Ltd. 46,000 * 10.00 4.60 (d) 4.60
2,240.82 2,166.05 Less : Provision for diminution in the value of Investments 11.61 11.61
2,229.21 (b) 2,154.44
Notes :
(a) All the above investments are Non-Trade, except those marked with an asterisk.
(b) Includes Government Securities of the face value of Rs. 1.76 Lakh (Rs. 1.99 Lakh) and Rs. 0.60 Lakh (Rs. 0.60 Lakh)
deposited / pledged with various Government authorities and Hon’ble Allahabad High Court respectively (including Rs. 0.73 Lakh
(Rs. 0.71 Lakh) matured, but pending encashment).
(c) The figures, being less than Rs. 500, have not been shown above.
(d) Indicates securities where provision for diminution in the value of Investments has been made.
The Oudh Sugar Mills Limited (Consolidated)78
SCHEDULES forming part of the Consolidated Balance Sheet (Contd.)
(Rs. in Lakhs)
30th June, 2009 30th June, 2008
SCHEDULE - 7 : INVENTORIES
At lower of cost and net realisable value
Raw Materials 886.36 235.44
Stores, Chemicals, Spare Parts, etc.
[including in transit Rs. 7.46 Lakhs (Rs. 12.19 Lakhs)] 1,219.42 1,204.74
Finished Goods 13,859.51 25,744.12
Power - Banked 29.38 30.75
Goods under Process 478.88 262.20
Standing Crop 38.83 30.60
16,512.38 27,507.85
At estimated net realisable value
By Products 852.85 1,509.43
Scrap 13.54 20.89
Country Crop 1.40 1.65
867.79 1,531.97
17,380.17 29,039.82
SCHEDULE - 8 : SUNDRY DEBTORS
(Unsecured , unless otherwise specified)
(a) Debts due for a period exceeding six months :
Considered Good 21.89 31.81
Considered Doubtful 44.62 118.87
66.51 150.68
Less: Provision 44.62 118.87
21.89 31.81
(b) Other Debts
Considered Good
[includes secured Rs. 2.79 Lakhs (Rs. 6.06 Lakhs)] 753.43 616.58
775.32 648.39
SCHEDULE - 9 : CASH & BANK BALANCES
Cash in hand 42.43 19.70
Cheques / Drafts in hand 36.59 130.39
79.02 150.09
With Scheduled Banks on :
Current Account 179.66 178.10
Unpaid Dividend Account 10.73 10.83
Fixed Deposit Account [Receipts for Rs. 216.45 Lakhs (Rs. 30.70 Lakhs)
pledged with various Govt.authoritities as security / Bank as margin money] 229.66 56.50
420.05 245.43
Annual Report 2008-09 FINANCIAL STATEMENTS 79
With Non-Scheduled Banks on Current Account:
Name of the BankMaximum amount
outstanding during the year
Lucknow Kshetriya Gramin Bank 878.17 (1,554.31) 10.37 15.67
Zila Sahkari Bank Ltd., Sitapur 172.24 (169.56) 3.75 4.74
District Co-operative Bank Ltd., Lakhimpur Kheri 391.58 (547.04) 4.42 4.71
Urban Co-operative Bank Ltd.,Lakhimpur Kheri 27.11 (26.09) 1.13 0.62
Avadh Gramin Bank, Hardoi 0.40 (0.69) 0.35 0.34
Baroda Uttar Pradesh Grameen Bank 242.60 (376.99) 2.10 1.74
22.12 27.82
With Post office on :
Savings Account (Pass Book lodged with various Govt.
Authorities) 0.44 0.58
521.63 423.92
SCHEDULE - 10 : OTHER CURRENT ASSETS
Interest accrued on Investments 2.67 3.68
Accrued interest on loans, deposits etc.
Considered Good 6.35 0.87
Considered Doubtful - 0.58
6.35 1.45
Less : Provision - 0.58
6.35 0.87
9.02 * 4.55
* including Rs. 0.43 Lakh (Rs. 0.91 Lakh) due for more than six months
SCHEDULE - 11: LOANS AND ADVANCES
UNSECURED
Considered good
Loans :
Bearing interest
To Employees 30.57 29.61 To Others 3.69 15.07
34.26 44.68 Advances :
Advances recoverable in cash or in kind or for value to be received or pending
adjustments 771.66 1,052.85
Sales tax, Excise duty etc. paid under appeal and/or under dispute 107.03 105.79
Balance with Excise & other Govt.Authorities 3,445.38 2,775.34
Claims and Refunds receivable 783.20 768.98
Advance payment of Tax, Refunds receivable and Tax
deducted at source (after adjusting provisions) - 151.03
Advance for Fringe Benefit tax (net of provision) 6.01 3.71
Minimum Alternative Tax (MAT) Credit Entitlement 836.59 717.57
Sundry Deposits 46.01 48.04
5,995.88 5,623.31
6,030.14 5,667.99
SCHEDULES forming part of the Consolidated Balance Sheet (Contd.)
(Rs. in Lakhs)
30th June, 2009 30th June, 2008
SCHEDULE - 9 : CASH & BANK BALANCES (Contd.)
The Oudh Sugar Mills Limited (Consolidated)80
SCHEDULES forming part of the Consolidated Balance Sheet (Contd.)
(Rs. in Lakhs)
30th June, 2009 30th June, 2008
Considered doubtful:
Advances & Claims 343.20 280.74
Less : Provisions 343.20 280.74
- -
6,030.14 5,667.99
NOTES :
Amount due from Officers of the Company
Loans - -
Advances - 0.41
- 0.41
Maximum amount due at any time during the year
Loans - 6.00
Advances 9.77 7.27
9.77 13.27
Amount due from the Managing Director of the Company - -
Maximum amount due at any time during the year - 6.09
SCHEDULE - 11: LOANS AND ADVANCES (Contd.)
(Rs. in Lakhs)30th June, 2009 30th June, 2008
SCHEDULE - 12 : CURRENT LIABILITIES & PROVISIONS A. Current Liabilities :
Acceptances 1,648.13 - Sundry Creditors for goods, services, expenses etc. Due to Micro and Small Enterprises 342.91 415.97 (Refer note no. 13 on Schedule 23) Due to Others 6,178.44 7,959.57 For Other Finance 385.78 682.31 Excess price of sugar including excise duty 79.41 79.41 Advance against sale of goods 1,639.64 1,748.71 Interest accrued but not due on loans, deposits etc. 42.62 36.67 Preference Shares Redemption Account 0.05 0.05 Unclaimed Scrip Dividend 0.04 0.04 Less: Shares held for distribution 0.04 - 0.04 - Fractional entitlements for Bonus Shares andBearer Coupons 0.07 0.07 Investor Education & Protection Fund : (not yet due) Unpaid & Unclaimed Dividends 10.73 10.83 Unclaimed matured Fixed Deposits 7.30 20.40
10,335.08 10,953.99 B. Provisions :
Leave 106.87 80.13 Gratuity - 70.81 Warranties 7.11 8.12 Taxation (net of advance tax) 46.77 - Proposed Dividend on Equity Shares 328.79 - Tax on proposed dividend 55.88 -
545.42 159.06 10,880.50 11,113.05
Annual Report 2008-09 FINANCIAL STATEMENTS 81
(Rs. in Lakhs)2008-2009 2007-2008
SCHEDULE - 13 : GROSS SALES Finished Goods 56,724.39 32,971.58 Power 587.06 725.56 By-Products 998.11 1,529.74 Sugar Hedging Transactions (net) - 135.24 Others 14.32 39.03
58,323.88 35,401.15 Less : Claims, Rebates etc. 14.75 7.56
58,309.13 35,393.59
SCHEDULE - 14 : OTHER INCOMEIncome from Long Term Investments (Non-Trade)Dividend 46.26 108.42 Interest - 0.01 Insurance & Other claims 18.54 23.81 Rent & Hire charges 17.38 18.94 Profit on sale of Long Term Investments (Non-Trade) - 15.31 Exchange rate fluctuations (net) 3.28 - Export Incentives 49.81 22.42 Unspent liabilities, excess provisions and unclaimed balances written back (net) 172.93 212.69 Provision for diminution in value of investments no longer required written back - 0.25 Cane Price Subsidy for earlier years - 573.58 Buffer Stock subsidy towards Insurance & storage charges 4.58 83.50 Profit on Fixed Assets sold/ discarded (net) 11.20 66.42 Items pertaining to previous years (net) 0.10 0.12 Miscellaneous Receipts 6.65 8.61
330.73 1,134.08
(Rs. in Lakhs)2008-2009 2007-2008
SCHEDULE - 15 : DECREASE / (INCREASE) IN STOCKS :Opening Stocks :
Finished Goods 25,744.12 16,732.27 Power - Banked 30.75 24.72 By-Products 1,509.43 840.80 Goods under Process 262.20 317.73 Scrap 20.89 21.46
27,567.39 17,936.98 Add : Stocks (Refer schedule - 5) :
Finished Goods 176.20 - By-Products 24.03 - Goods under Process 72.97 273.20 - -
27,840.59 17,936.98 Less : Closing Stocks :
Finished Goods 13,859.51 25,744.12 Power - Banked 29.38 30.75 By-Products 852.85 1,509.43 Goods under Process 478.88 262.20 Scrap 13.54 20.89
15,234.16 27,567.39 12,606.43 (9,630.41)
SCHEDULES forming part of the Consolidated Profit & Loss Account
The Oudh Sugar Mills Limited (Consolidated)82
(Rs. in Lakhs)
2008-2009 2007-2008
SCHEDULE - 16 : AGRICULTURAL LOSS
INCOMESales including inter- transfers Rs. 21.31 Lakhs (Rs. 24.78 Lakhs) 51.66 34.89 Other Income :Rent & Hire Charges 17.73 25.23 Profit on sale / discard of fixed assets 10.18 - Miscellaneous Receipts 0.40 28.31 3.24 28.47 Increase in Stocks :Closing Stock 40.23 32.25 Less: Opening Stock 32.25 7.98 29.21 3.04
87.95 66.40 EXPENDITURESeeds, Manures and Fodder Consumed 34.14 22.15 Stores & Spares Consumed 1.50 0.27 Tractor Expenses 29.92 32.29 Repairs to : Machinery 0.62 0.72 Building 0.20 0.06 Others 1.25 0.30 Lease Land Rent 1.58 - Rates & Taxes 0.19 0.15 Payments to and Provisions for Employees : Salaries, Wages & Bonus 31.24 26.79 Contribution to Provident and Other Funds 1.53 1.54 Gratuity 0.23 33.00 0.10 28.43 Insurance 0.12 0.15 Cartage & Transportation charges 0.23 1.09 Irrigation Expenses 0.97 0.82 Harvesting Expenses 0.44 1.06 Miscellaneous Expenses 2.39 2.56 Depreciation 2.88 2.34
109.43 92.39 Loss transferred to Profit & Loss Account 21.48 25.99
SCHEDULE - 17: RAW MATERIALS CONSUMED
Opening Stock 235.44 337.35
Add : Purchase & Procurement Expenses [including transfer of
sugarcane from own farms Rs. 21.31 Lakhs (Rs. 24.78 Lakhs)] 24,799.72 27,864.24
Purchase Tax & Cess (net) 281.78 335.73
25,316.94 28,537.32
Less : Sales - 0.05
Closing Stock 886.36 235.44
24,430.58 28,301.83
SCHEDULES forming part of the Consolidated Profit & Loss Account (Contd.)
Annual Report 2008-09 FINANCIAL STATEMENTS 83
(Rs. in Lakhs)2008-2009 2007-2008
SCHEDULE - 18 : STORES,SPARES & PACKING MATERIALS CONSUMEDStores, Spare Parts, Chemicals etc.[after adjusting Sales & Claims Rs. 200.71 Lakhs (Rs. 122.20 Lakhs) ] 1,183.01 1,495.77 Packing Materials 1,223.04 1,474.62
2,406.05 2,970.39
SCHEDULE - 19 : PAYMENTS TO AND PROVISIONS FOR EMPLOYEESSalaries, Wages, Bonus, etc. 2,607.74 2,527.77 Contribution to Provident & other Funds 218.59 208.16 Gratuity [Refer note no. 14 (b) on Schedule 23] 7.49 68.15 Workmen Compensation - 1.62 Employees’ Welfare Expenses 94.54 82.12
2,928.36 2,887.82
SCHEDULE - 20 : MANUFACTURING, SELLING AND OTHER EXPENSESRepairs to and Maintenance of :
Buildings 161.86 105.23 Machinery 1,030.09 1,276.57 Others 25.21 21.00
Rent 79.24 76.05 Rates & Taxes (net) 37.69 38.54 Insurance 84.60 78.01 Auditors' Remuneration :
As AuditorsAudit Fees 12.50 12.50 Tax Audit Fees 7.35 7.35 Limited Review Fees 7.35 4.50 In other capacity for Certificates & other services 5.00 2.08 For Expenses 2.06 1.96
Cost Auditors’ Remuneration : For Audit Fees 0.60 0.60 For Expenses 0.09 0.15
Selling Commission & Expenses :Commission on sales 268.56 159.60 Other selling expenses 448.07 400.28
Charity & Donations 15.80 4.97 Provision for bad and doubtful debts / advances 101.31 52.50 Provision for Warranties & Claims 5.78 6.86 Bad Debts, irrecoverable claims & advances written off 142.71 14.32 Less : Adjusted against provisions 113.68 29.03 2.35 11.97 Loss on sale of long term Investments - 24.75 Less : Adjusted against provisions - - 24.75 - Exchange rate fluctuations (net) - 2.13 Molasses Storage & Maintenance Reserve 4.02 6.55 Sales Tax for earlier years 5.12 - Preliminary Expenses written off 0.13 0.13 Sugar Hedging Transactions (net) 4.81 - Miscellaneous Expenses [including Directors' travelling Rs. 14.92 Lakhs (Rs.12.46 Lakhs)] 863.29 773.74
3,199.56 3,043.27
SCHEDULES forming part of the Consolidated Profit & Loss Account (Contd.)
The Oudh Sugar Mills Limited (Consolidated)84
(Rs. in Lakhs)2008-2009 2007-2008
SCHEDULE - 21 : DIRECTORS’ REMUNERATION
Directors’ Remuneration(a) Managing Director’s Remuneration :
Salary 39.00 39.00 Contribution to Provident Fund 4.68 4.68 Gratuity - 0.39 Provision for Leave 0.69 0.89
44.37 44.96 (b) Directors’ Fees 2.65 3.61
47.02 * 48.57
* Excludes Rs. 36.00 Lakhs (Rs. 30.00 Lakhs) and Rs. 22.52 Lakhs (Rs. 19.14 Lakhs) paid towards rent and maintenance respectively of the
accommodation provided to the Managing Director and the same has been included under the head “Rent” and “Miscellaneous
Expenses” in Schedule 20.
SCHEDULE - 22 : INTEREST & FINANCE CHARGE (NET)On Fixed Loans 4,258.03 3,368.46 On Other Loans 4,347.60 3,473.73 To Income Tax Department 8.03 -
8,613.66 * 6,842.19 Less : At Credit :
Amount Capitalised 3,458.08 2,513.86 Buffer Stock Subsidy towards interest 35.23 610.94 From Income Tax Department 14.54 0.01 On Unsecured Loans,Deposits etc. (Gross) :[Tax deducted at source Rs. 35.42 Lakhs (Rs. 1.04 Lakhs)] 164.28 39.57
3,672.13 3,164.38 4,941.53 3,677.81
* excludes Rs. 477.67 Lakhs (Rs. 165.57 Lakhs) being interest on excise duty loan from a Bank which is recoverable as subsidy from the
Government.
SCHEDULES forming part of the Consolidated Profit & Loss Account (Contd.)
Annual Report 2008-09 FINANCIAL STATEMENTS 85
SCHEDULE to the Consolidated Balance Sheet and Profit & Loss Account
SCHEDULE – 23 : ACCOUNTING POLICIES AND NOTES TO ACCOUNTS
Notes annexed to and forming part of the Company’s Consolidated
Balance Sheet and Profit & Loss Account as at and for the year
ended 30th June, 2009.
1. Principles Of Consolidated Financial Statements :
The consolidated financial statements which relate to The
Oudh Sugar Mills Ltd. and its subsidiary companies have
been prepared on the following basis :
a) The financial statements of the Company and its subsidiaries
are combined on a line-by-line basis by adding together the
book values of like items of assets, liabilities, income and
expenditure, after fully eliminating intra group balances,
intra group transactions and any unrealised profit/loss
included therein.
b) The consolidated financial statements have been prepared
using uniform accounting policies, except stated otherwise,
for like transactions and are prepared, to the extent possible,
in the same manner as the Company’s separate financial
statements.
(c) As the financial year of the subsidiaries closes on 31st
March, their audited accounts as at and for the year ended
31st March, 2009 have been incorporated in these accounts.
However, in order to eliminate the intra group balances,
certain adjustments pertaining to the period from 1st April,
2009 to 30th June, 2009 have been made in the accounts.
d) The difference between the cost of the Company’s
investments in the subsidiaries and their respective equity
as on the date of investment is treated as Goodwill / Capital
Reserve, as the case may be, in the financial statements.
e) The Subsidiary Companies considered in the financial
statements are as follows :
Name Country of Incorporation % of voting power /
ownership as on 30th
June, 2009
Hargaon Investment & Trading Company Ltd. India 100
OSM Investment & Trading Company Ltd. India 100
Champaran Marketing Company Ltd. India 100
Hargaon Properties Ltd. India 100
2. Statement Of Significant Accounting Policies :
(i) Basis of Preparation :
The financial statements have been prepared to comply in
all material respects with the Accounting Standards Notified
by the Companies Accounting Standards Rules, 2006 (as
amended) and the relevant provisions of the Companies
Act, 1956. The financial statements have been prepared
under the historical cost convention on an accrual basis. The
accounting policies applied by the Company are consistent
with those used in the previous year.
(ii) Use of Estimates :
The preparation of financial statements in conformity
with generally accepted accounting principles requires
management to make estimates and assumptions that affect
the reported amounts of assets and liabilities and disclosure
of contingent liabilities at the date of financial statements
and the results of operations during the reporting year end.
Although these estimates are based upon the management’s best knowledge of current events and actions, actual results could differ from these estimates.
(iii) Revenue Recognition :
(a) Revenue from sale of goods is recognised upon passage of title to the customers which generally coincides with delivery thereof.
(b) Dividend Income is recognised when the shareholders’ right to receive the payment is established by the balance sheet date.
(c) Due to uncertainty in realisation, following incomes are accounted for on acceptance / actual receipt basis :-
(i) Insurance and other claims.
(ii) Interest on doubtful loans and advances to cane growers.
(iii) Compensation receivable in respect of land
surrendered to / acquired by the Government.
The Oudh Sugar Mills Limited (Consolidated)86
(iv) Fixed Assets :
Fixed assets are stated at cost less accumulated depreciation
and impairment, if any. Cost comprises the purchase price
inclusive of duties (net of cenvat credit), taxes, incidental
expenses and erection / commissioning expenses etc. upto
the date the asset is ready for its intended use.
Machinery spares which can be used only in connection
with an item of fixed assets and whose use as per technical
assessment is expected to be irregular, are capitalised and
depreciated over the residual life of the respective assets.
Assets awaiting disposal are valued at the lower of written
down value and net realisable value.
(v) Impairment of Assets :
The carrying amounts of assets are reviewed at each balance
sheet date to determine whether there is any indication
of impairment based on external / internal factors. An
impairment loss is recognised wherever the carrying amount
of an asset exceeds its recoverable amount which represents
the greater of the net selling price and ‘Value in use’ of
the assets. The estimated future cash flows considered for
determining the value in use, are discounted to their present
value at the weighted average cost of capital.
(vi) Depreciation :
(a) The classification of plant and machinery into
continuous and non continuous process is done as
per technical certification and depreciation thereon is
provided accordingly.
(b) Depreciation on fixed assets is provided as per straight
line method, at the rates prescribed in schedule XIV of
the Companies Act, 1956, except on gross assets valuing
Rs. 43.28 Lakhs (Rs. 43.28 Lakhs), where written-down
value method is followed.
(c) Depreciation on fixed assets added / disposed of during
the year is provided on pro-rata basis, with reference
to the date of addition / disposal.
(d) In case of impairment, if any, depreciation is provided
on the revised carrying amount of the assets over its
remaining useful life.
(vii) Government Grants and subsidies :
Government Grants and subsidies are recognised when
there is reasonable assurance that the same will be received.
Revenue grants / subsidies are recognised in the Profit & Loss
Account. Capital grants relating to specific fixed assets are
reduced from the gross value of the respective fixed assets.
Other capital grants are credited to capital reserve.
(viii) Borrowing Costs :
Borrowing costs relating to acquisition / construction of
qualifying assets are capitalized until the time all substantial
activities necessary to prepare the qualifying assets for their
intended use are complete. A qualifying asset is one that
necessarily takes substantial period of time to get ready for
its intended use. All other borrowing costs are charged to
revenue.
(ix) Investments :
Investments that are readily realisable and intended to
be held for not more than a year are classified as Current
Investments. All other Investments are classified as Long
term Investments. Current Investments are stated at lower
of cost and market rate on individual investment basis. Long
term investments are considered “at cost” on individual
investment basis, unless there is a decline other than
temporary in the value, in which case adequate provision is
made against such diminution in the value of investments.
(x) Inventories :
(a) Raw Materials, stores and spares are valued at lower
of cost and net realisable value. However, these items
are considered to be realisable at cost if the finished
products, in which they will be used, are expected to be
sold at or above cost. Cost is determined on a weighted
average basis.
Goods under process and finished goods (including
Power Banked) are valued at lower of cost and net
realisable value. Finished goods and Goods under
process include cost of conversion and other costs
incurred in bringing the inventories to their present
location and condition.
By products, Country crop and Saleable scraps, whose
cost is not identifiable, are valued at estimated net
realisable value.
Net realisable value is the estimated selling price in
the ordinary course of business, less estimated costs of
completion and estimated costs necessary to make the
sale.
(b) In case of inter-transferred materials, the transfer price
is considered as cost for the purpose of valuation of
closing stock.
SCHEDULE to the Consolidated Balance Sheet and Profit & Loss Account (Contd.)
SCHEDULE – 23 : ACCOUNTING POLICIES AND NOTES TO ACCOUNTS (Contd.)
Annual Report 2008-09 FINANCIAL STATEMENTS 87
(xi) Foreign Currency Transactions :
(a) Initial Recognition
Foreign currency transactions are recorded in the
reporting currency, by applying to the foreign currency
amount the exchange rate between the reporting
currency and the foreign currency at the date of the
transaction.
(b) Conversion
Foreign currency monetary items are reported using
the closing rate. Non-monetary items which are carried
in terms of historical cost denominated in a foreign
currency are reported using the exchange rate at the
date of the transaction, and non-monetary items which
are carried at fair value or other similar valuation
denominated in a foreign currency are reported using
the exchange rates that existed when the values were
determined.
(c) Exchange Differences
Exchange differences arising on the settlement /
conversion of monetary items are recognised as income
or expenses in the year in which they arise.
(d) Forward Exchange Contracts not entered for trading or
speculation purpose.
The premium or discount arising at the inception of
forward exchange contracts is amortised as expenses
or income over the life of the respective contracts.
Exchange differences on such contracts are recognised
in the statement of profit and loss in the period in which
the exchange rates change. Any profit or loss arising on
cancellation or renewal of forward exchange contracts
is recognised as income or expense for the year.
(xii) Retirement Benefits :
(a) Retirement benefits in the form of Provident and
Pension Funds are defined contribution schemes and
are charged to the Profit and Loss Account of the year
when the contributions to the respective funds are
due. The Company has no obligations other than the
contribution payable to the respective trusts / funds.
(b) Gratuity liability being a defined benefit obligation
is provided for on the basis of actuarial valuation on
projected unit credit method made at the end of each
year.
(c) Long term compensated absences are provided for
based on actuarial valuation on projected unit credit
method made at the end of each year.
(d) Actuarial gains / losses are immediately taken to profit
and loss account and are not deferred.
(xiii) Taxation :
Tax expense comprises of current, deferred and fringe benefit
tax. Current income tax and fringe benefit tax are measured
at the amount expected to be paid to tax authorities in
accordance with Income Tax Act, 1961. Deferred income
tax reflects the impact of current year timing differences
between taxable income and accounting income for the year
and reversal of timing differences of earlier years.
The deferred tax for timing differences between the book
and tax profit for the year is accounted for using the tax
rates and laws that have been substantively enacted as of the
Balance Sheet date. Deferred tax asset is recognised only to
the extent that there is reasonable certainty that sufficient
future taxable income will be available against which such
deferred tax asset can be realised. If the company has carry
forward unabsorbed depreciation and tax losses, deferred
tax asset is recognised only to the extent that there is virtual
certainty supported by convincing evidence that sufficient
taxable income will be available in future against which such
deferred tax asset can be realised.
The carrying amounts of deferred tax assets are reviewed
at each balance sheet date. The company writes-down the
carrying amount of a deferred tax asset to the extent that
it is no longer reasonably certain or virtually certain, as the
case may be, that sufficient future taxable income will be
available against which deferred tax asset can be realised.
Any such write-down is reversed to the extent that it
becomes reasonably certain or virtually certain, as the case
may be, that sufficient taxable income will be available in
future.
At each balance sheet date the Company re-assesses
unrecognised deferred tax assets. It recognizes unrecognised
deferred tax assets to the extent that it has become reasonably
certain or virtually certain, as the case may be that sufficient
future taxable income will be available against which such
deferred tax assets can be realised.
Minimum Alternative Tax (MAT) credit is recognised as
an asset only when and to the extent there is convincing
evidence that the company will pay normal income tax during
SCHEDULE to the Consolidated Balance Sheet and Profit & Loss Account (Contd.)SCHEDULE – 23 : ACCOUNTING POLICIES AND NOTES TO ACCOUNTS (Contd.)
The Oudh Sugar Mills Limited (Consolidated)88
the specified period. In the year in which the MAT credit
becomes eligible to be recognised as an asset in accordance
with the recommendations contained in the guidance Note
issued by the Institute of Chartered Accountants of India,
the said asset is created by way of a credit to the profit
and loss account and shown as MAT Credit Entitlement. The
Company reviews the same at each balance sheet date and
writes down the carrying amount of MAT Credit Entitlement
to the extent there is no longer convincing evidence to the
effect that the Company will pay normal Income Tax during
the specified period.
(xiv) Segment Reporting :
(a) Identification of Segments :
The Company has identified that its operating segments
are the primary segments. The Company’s operating
businesses are organised and managed separately
according to the nature of products, with each
segment representing a strategic business unit that
offers different products and serves different markets.
The analysis of geographical segments is based on
the areas in which the customers of the Company are
located.
(b) Inter Segment Transfers :
The Company accounts for inter segment transfers at
mutually agreed transfer prices.
(c) Allocation of Common Costs :
Common allocable costs are allocated to each segment
on case to case basis applying the ratio, appropriate to
each relevant case. Revenue and expenses which relate
to the enterprise as a whole and are not allocable to
segments on a reasonable basis, are included under the
head “Unallocated – Common”.
The accounting policies adopted for segment reporting
are in line with those of the Company.
(xv) Fixed Assets Acquired under Lease :
(a) Finance Lease :
Assets acquired under lease agreements which
effectively transfer to the company substantially all
the risk and benefits incidental to ownership of the
leased items, are capitalized at the lower of the fair
value and present value of minimum lease payment at
the inception of the lease term and disclosed as leased
assets. Lease payments are apportioned between the
finance charges and the reduction of the lease liability
so as to achieve a constant rate of interest on the
remaining balance of their liability. Finance charges
are charged directly to the expenses account.
b) Operating Lease :
Leases where the lessor effectively retains substantially
all the risks and benefits of the ownership of the leased
assets are classified as operating leases. Operating lease
payments are recognised as an expense in the profit
and loss account.
(xvi) Share Issue Expenses :
Share issue expenses are adjusted against Securities Premium
Account.
(xvii) Earning per Share :
Basic Earning per Share is calculated by dividing the net
profit or loss for the year attributable to equity shareholders
by the weighted number of equity shares outstanding during
the year.
For the purpose of calculating diluted earning per share, net
profit or loss for the year attributable to equity share holders
and the weighted average number of shares outstanding
during the year are adjusted for the effect of all dilutive
potential equity shares.
(xviii) Excise Duty :
Excise Duty is accounted for at the point of manufacture of
goods and accordingly, is considered for valuation of stocks
as on the Balance Sheet date.
(xix) Hedging :
The company has adopted a policy to minimize risks
associated with foreign exchange fluctuations with respect
to its borrowings.
The premium or discount arising at the inception of forward
exchange contracts is amortised as expense or income over
the life of the contract.
(xx) Research Costs :
Research costs of revenue nature are expensed as and when
they are incurred, while capital expenditure is added to the
cost of the respective fixed assets.
(xxi) Cash and Cash equivalents :
Cash and cash equivalents in the cash flow statement comprise
of cash at bank and in hand and short-term investments with an
original maturity of three months or less.
SCHEDULE to the Consolidated Balance Sheet and Profit & Loss Account (Contd.)SCHEDULE – 23 : ACCOUNTING POLICIES AND NOTES TO ACCOUNTS (Contd.)
Annual Report 2008-09 FINANCIAL STATEMENTS 89
(xxii) Provisions :
A provision is recognised when an enterprise has a present
obligation as a result of past event and it is probable that an
outflow of resources will be required to settle the obligation,
in respect of which a reliable estimate can be made.
Provisions made in terms of Accounting Standard 29 are not
discounted to its present value and are determined based on
management estimate required to settle the obligation, at
the Balance Sheet date. These are reviewed at each Balance
Sheet date and adjusted to reflect the current management
estimates.
(xxiii) Derivative Instruments :
As per the announcement made by the Institute of Chartered
Accountants of India, Derivative contracts, other than those
covered under AS-11, are marked to market on a portfolio
basis, and the net loss after considering the offsetting effect
of the underlying hedged item is charged to the income
statement. Net gains are ignored as a matter of prudence.
(xxiv) Contingencies :
Liabilities which are material and whose future outcome
cannot be ascertained with reasonable certainty are
treated as contingent and disclosed by way of notes to the
accounts.
3. Estimated amount of contracts remaining to be executed on Capital Account (net of advances)
and not provided for
1,371.16 8,186.52
4. Contingent Liabilities not provided for in respect of :–
(a) Demands / Claims by various Government Authorities and others not acknowledged as
debts:
(i) Excise Duty & Service Tax 705.71 773.85
(ii) Sales & Entry Tax 156.41 241.52
(iii) Duty under State Acts 230.18 155.05
(iv) Others 28.16 36.12
Total 1,120.46 1,206.54
(b) (i) Guarantees given to a bank against loans to cane growers 4,000.00 3,000.00
(ii) Against the above, the loan facilities actually availed as on the
Balance Sheet date 3,047.93 2,350.22
(c) Unredeemed bank guarantees 0.96 0.96
(d) Uncalled capital on partly paid shares held as Investments 123.60 123.60
(e) Bills discounted with banks [since realised Rs. 81.00 Lakhs (Rs. 49.26 Lakhs)] 176.00 66.54
5. Excise Duty & Cess on stocks represents differential excise
duty and cess on opening and closing stock of finished goods
/ by products.
6. Pending disposal of writs / appeals by the court with regard
to levy sugar prices for some years, Rs. 79.41 Lakhs (Rs. 79.41
Lakhs) (net) received as excess levy sugar price, against which
bank guarantees furnished by the Company for Rs. 84.88
Lakhs, are in force in terms of the Court Orders, is included
under the head ‘Current Liabilities’. Necessary adjustment
for the above amount together with interest, if any, in this
SCHEDULE to the Consolidated Balance Sheet and Profit & Loss Account (Contd.)
(Rs. in Lakhs)
As at 30th
June, 2009
As at 30th
June, 2008
regard will be made in the accounts as and when the matter
will be finally settled.
7. Pending decisions of various courts on writ petitions filed
by / against the Company, no credit has been taken in the
Profit and Loss Account in respect of certain realisations
aggregating to Rs. 52.05 Lakhs in earlier years, which
continue to be shown under the head “Liabilities for other
Finance” in Schedule – 12. Against the above, fixed deposit
receipts / bank guarantees for similar amount have been
furnished by the Company.
SCHEDULE – 23 : ACCOUNTING POLICIES AND NOTES TO ACCOUNTS (Contd.)
The Oudh Sugar Mills Limited (Consolidated)90
8. In view of the interim order dated 8th September, 2008 of the Hon’ble Supreme Court, the Company for its Hargaon and Rosa Sugar units in Uttar Pradesh has continued the provision towards Sugarcane purchases made during the year 2007-08 @ Rs. 110 per quintal as against the State Advised Price (SAP) of Rs. 125 per quintal. Pending final decision by the Hon’ble Supreme Court in this matter, the differential price of Rs. 2,422.74 Lakhs between SAP and the amount already provided, as stated above, has not been accounted for.
(Rs. in Lakhs)
As at 30th
June, 2009
As at 30th
June, 2008(A) Deferred Tax Liability
(i) Timing difference in depreciable assets 6,557.38 5,344.786,557.38 5,344.78
(B) Deferred Tax Asset(i) Carry forward unabsorbed depreciation 5,188.26 4,659.60(ii) Expenses allowable against taxable income in future years 739.03 1,117.42
5,927.29 5,777.02Net Deferred Tax Liability / (Asset) ( A – B ) 630.09 (432.24)
(Rs. in Lakhs)2008-2009 2007-2008
(i) Principal amount remaining unpaid to any supplier at the end of accounting year
(including retention money against performance). 317.74 408.06(ii) Interest due on above. 9.82 2.99
Total of (i) & (ii) 327.56 411.05(iii) Amount of interest paid by the Company to the suppliers in terms of section 16 of
the Act. - -(iv) Amount paid to the suppliers beyond the respective due date. 106.93 105.52(v) Amount of interest due and payable for the period of delay in payments (which have
been paid but beyond the due date during the year) but without adding the interest
specified under the Act. 5.31 4.92(vi) Amount of interest accrued and remaining unpaid at the end of accounting year. 15.13 7.91(vii) Amount of further interest remaining due and payable even in the succeeding
years, until such date when the interest dues as above are actually paid to the small
enterprise, for the purpose of disallowance as a deductible expenditure under section
23 of this Act. 10.04 -
SCHEDULE to the Consolidated Balance Sheet and Profit & Loss Account (Contd.)
9. Diminution of Rs. 180.86 Lakhs (Rs. 203.13 Lakhs) in the value of certain quoted investments based on the last quoted price has not been provided, as the breakup value of the said company supplemented by the market value as on 30th June, 2009, of the quoted investments held by the investee company is much higher than the corresponding book value.
10. a) The break-up of net Deferred Tax Liability as on 30th June, 2009 is as under:
b) Minimum Alternate Tax (MAT) credit entitlement of Rs.
836.59 Lakhs (Rs. 717.57 Lakhs), being available as tax
credit for set off in future years as per the Income Tax
Act, 1961, is carried forward for future adjustments
based on future profitability projections.
11. a) Pending execution of the conveyance deed, no
adjustment has been made in respect of 0.75 acre of
land sold by the Company in earlier years.
13. Based on the information / documents available with the Company, information as per the requirement of Section 22 of The Micro,
Small and Medium Enterprises Development Act, 2006 are as under:
b) An application filed by the Company for exemption of
3785.19 sq. mtrs. of land at Bamrauli under the Urban
Land (Ceiling and Regulation) Act, 1976, is pending
with the concerned authority.
12. A civil suit is pending against the Company’s sugar unit at
Dhadha Bujurg (Hata), which is already in operation. The
Company has been legally advised that the said civil suit is
not tenable as per law.
SCHEDULE – 23 : ACCOUNTING POLICIES AND NOTES TO ACCOUNTS (Contd.)
Annual Report 2008-09 FINANCIAL STATEMENTS 91
14 (a) The Company has a defined benefit gratuity plan. Every employee who has completed five years or more of service is entitled
to Gratuity on terms as per provisions of The Payment of Gratuity Act, 1972. The Company has got an approved gratuity fund
which has taken an insurance policy with Life Insurance Corporation of India (LIC) to cover the gratuity liabilities.
(b) The following tables summarize the components of net benefit expenses recognised in the Profit & Loss Account and the
funded status and amounts recognised in the balance sheet for gratuity.
(Rs. in Lakhs)2008-09 2007-08
(i) Net Employee Expense /(benefit)Current service cost 49.45 47.16Interest cost on benefit obligation 54.19 51.17Expected return on plan assets (53.23) (45.70)Net Actuarial Loss (Gain) recognised in the year (41.26) 16.54Total employer expense 9.15* 69.17* including Rs. 1.43 Lakhs (Rs. 0.53 Lakh) capitalised as pre-operative expenses
in Schedule-5(ii) Actual return on plan assets 155.39 47.45(iii) Benefit Asset / (Liability)
Fair Value of Plan Assets 840.81 628.78Defined benefit obligation 802.93 699.59Benefit Asset / (Liability) 37.88 (70.81)
(iv) Movement in benefit liabilityOpening defined benefit obligation 699.59 665.13Interest cost 54.19 51.17Current service cost 49.45 47.16Benefits paid (61.20) (82.16)Actuarial (gains) / losses on obligation 60.90 18.29Closing benefit obligation 802.93 699.59
(v) Movement in fair value of plan assetsOpening fair value of plan assets 628.78 533.36Expected Return on plan assets 53.23 45.70Contribution by employer 117.84 130.13Benefits paid (61.20) (82.16)Actuarial gains / (losses) on obligation 102.16 1.75Closing fair value of plan assets 840.81 628.78
(vi) The major categories of plan assets as a percentage of the fair value of total plan assetsFunded with insurer 100% 100%
(vii) The Principal actuarial assumptions are as follows: Discount rate 7.6% 8.1%Expected Return on plan assets 8.1% 8.5%Salary Increase 5% 5%
Withdrawal rates Varying between 1% to 7% per annum
depending upon the duration and age of the
employeesThe overall expected rate of return on assets is assumed to be 8.10% per annum as at 1st July, 2008 i.e. the same as discount
rate as at 30th June, 2008 because the assets are primarily invested in Government Bonds.
SCHEDULE to the Consolidated Balance Sheet and Profit & Loss Account (Contd.)SCHEDULE – 23 : ACCOUNTING POLICIES AND NOTES TO ACCOUNTS (Contd.)
The Oudh Sugar Mills Limited (Consolidated)92
(viiii) Amount incurred as expense for defined contribution to
Provident / Pension fund plan Rs. 224.04 Lakhs (Rs. 214.62
Lakhs) [including Rs. 12.11 Lakhs (Rs. 6.19 Lakhs)] capitalised
as pre-operative expenses in Schedule-5).
(ix) The estimates of future salary increases considered in
(Rs. in Lakhs)
2008-09 2007-08
(xi) The details for the current and previous year are as follows :
Defined Benefit Obligation 802.93 699.59
Plan Assets 840.81 628.78
Surplus / (Deficit) 37.88 (70.81)
Experience Adjustments on Plan Liabilities Not Available *
Experience Adjustments on Plan Assets Not Available *
* The management has relied on the overall actuarial valuation conducted by the actuary. However, experience adjustments on plan
liabilities and assets are not readily available and hence not disclosed.
(c) The following items are included under other heads of expenses in the Profit & Loss Account :
(Rs. in Lakhs)
2008 2009 2007 2008
Salaries & Wages 490.38 580.49
Stores and Spares, etc. 1,083.96 1,171.85
Insurance 0.20 0.42
SCHEDULE to the Consolidated Balance Sheet and Profit & Loss Account (Contd.)
actuarial valuation, take account of inflation, seniority,
promotion and other relevant factors, such as supply and
demand in the employment market.
(x) The Company expects to contribute Rs. 120 Lakhs to Gratuity
fund in 2009-2010.
(b) Gratuity amount appearing in schedule 19 is after
adjustment of surplus of Rs. 37.88 Lakhs as indicated above,
being the excess of plan assets over the actuarial liability as
on the balance sheet date.
15. The subsidiary companies have given undertakings to a
bank / financial institution not to transfer, assign, pledge,
hypothecate or otherwise dispose of their shareholding in
Sutlej Textiles & Industries Ltd. and Modern DiaGen Services
Ltd. without their prior approval in writing till the loans
granted by them to these Companies remain outstanding.
16. (a) The company has raised Rs. 2,323.01 Lakhs (including
securities premium Rs. 1,935.84 Lakhs) by issue of
equity shares of Rs. 10 each at a premium of Rs. 50
per equity share on Rights basis during the year and
has utilised the proceeds of the issue for repayment
of a part of the working capital borrowings as well as
expenses incurred on such rights issue.
(b) In addition to equity shares allotted on rights basis, as
stated above 39,98,240 detachable warrants were also
allotted to the shareholders in terms of the said rights
issue entitling them to apply for one equity share of
Rs. 10 each for each warrant held on the date to be
declared by the Company during the warrant exercise
period between 12th March, 2009 to 11th September,
2012 at a price to be determined in the manner as
indicated in the Letter of Offer.
(c) Rights Shares Issue expenses include Rs. 22.00 Lakhs
paid to the Statutory Auditors.
17. (a) Salaries and Wages relating to various repairs have not
been charged separately to the repairs, as the amount
thereof has not been demarcated.
(b) Consumption of raw materials, stores, spare parts and
packing materials includes profit/loss on sale thereof.
SCHEDULE – 23 : ACCOUNTING POLICIES AND NOTES TO ACCOUNTS (Contd.)
Annual Report 2008-09 FINANCIAL STATEMENTS 93
18. Earning per Share (EPS) :
In terms of Accounting Standard - 20, the calculation of EPS is given below :
(Rs. in Lakhs)
2008-09 2007-08
Profit / (Loss) as per Profit & Loss Account (Rs. in Lakhs) 1,960.41 (346.16)
Weighted average number of Equity Shares outstanding during the year (Rs. 10 each) 2,05,29,746 1,81,73,820
Basic and Diluted earnings per share (Rs.) 9.55 (1.90)
The impact of diluted shares, if any, arising out of the exercise of detachable warrants as indicated in Note no. 16 above, has not
been considered for the computation of EPS, since the quantum of such dilutive option is not presently ascertainable.
19. Operating lease :
Certain office premises, godowns, etc. are obtained on operating lease. The lease term is for 1-3 years and renewable for further
period either mutually or at the option of the Company. There is no escalation clause in the lease agreement. There are no
restrictions imposed by lease agreements. There are no subleases. The leases are cancellable.
(Rs. in Lakhs)
Particulars 2008-2009 2007-2008
Lease payments made for the year 79.24 76.05
Contingent rent recognised in the profit and loss account Nil Nil
20. The movements in provision for warranties during the year are as follows :
(Rs. in Lakhs)
Balance as at
01.07.2008
Additions during the
year
Amount used during
the year
Balance as at
30.06.2009
Warranties 8.12 5.78 6.79 7.11
SCHEDULE to the Consolidated Balance Sheet and Profit & Loss Account (Contd.)SCHEDULE – 23 : ACCOUNTING POLICIES AND NOTES TO ACCOUNTS (Contd.)
The Oudh Sugar Mills Limited (Consolidated)94
21. The Consolidated segment information as at and for the year ended 30th June, 2009 are as below:
(Rs. in Lakhs)
Sugar SpiritsCo-
generation
Food
processingOthers Total
(a) Revenue (net of excise duty and cess)
External Sales 47,537.74 5,017.13 587.06 2,507.44 - 55,649.37
(25,839.51) (4,677.10) (725.57) (1,913.72) (-) (33,155.90)
Inter-segment Sales 4,082.09 13.40 1,490.57 - - 5,586.06
(3,388.80) (18.10) (1,661.37) (-) (-) (5,068.27)
Total Revenue 51,619.83 5,030.53 2,077.63 2,507.44 - 61,235.43
(29,228.31) (4,695.20) (2,386.94) (1,913.72) (-) (38,224.17)
(b) Results
Segment Results 7,907.55 -64.42 379.01 195.06 -0.02 8,417.18
(1,761.34) (1,025.79) (553.10) (79.64) (-0.56) (3,419.31)
Unallocated expenses net of unallocated Income 427.85
(263.19)
Operating Profit 7,989.33
(3,156.12)
Interest & Finance Charges (net) 4,941.53
(3,677.81)
Income, Wealth & Fringe Benefit Tax (net) 144.08
(32.66)
MAT Credit Entitlement/(-) Reversal 119.02
(-3.93)
Deferred Tax Charge/(Credit) 1,062.33
(-212.12)
Net Profit/(-) Loss 1,960.41
(-346.16)
(c) Total Assets
Segment Assets 70,788.27 13,664.38 6,051.99 1,176.18 3.00 91,683.82
(73,144.09) (12,827.55) (6,488.18) (1,070.87) (3.08) (93,533.77)
Unallocated Assets 4,138.61
(4,390.69)
95,822.43
(97,924.46)
(d) Total Liabilities
Segment Liabilities 8,919.02 649.20 28.73 790.96 0.12 10,388.03
(9,386.30) (862.24) (41.03) (735.26) (0.15) (11,024.98)
Unallocated Liabilities 70,303.72
(75,498.60)
80,691.75
(86,523.58)
SCHEDULE to the Consolidated Balance Sheet and Profit & Loss Account (Contd.)SCHEDULE – 23 : ACCOUNTING POLICIES AND NOTES TO ACCOUNTS (Contd.)
Annual Report 2008-09 FINANCIAL STATEMENTS 95
(e) Other Information (i) Non cash expenses 4.02 - - - - 4.02
(6.55) (-) (-) (-) (-) (6.55)(ii) Capital Expenditure 11,360.20 696.02 71.76 4.22 - 12,132.20
(11,898.40) (8,013.00) (310.51) (19.55) (-) (20,241.46)(iii) Depreciation for the year 1,741.85 521.60 366.20 5.23 0.03 2,634.91
(1,731.03) (181.52) (314.39) (5.05) (0.03) (2,232.02)(f) Geographical Segments
RevenueDomestic 54,969.87
(32,851.00)Overseas (Including through third party) 679.50
(304.90)55,649.37
(33,155.90)
Notes :
(i) Business Segment: The business segments have been identified on the basis of the products of the Company. Accordingly,
the Company has identified “Sugar”, “Spirits”, “Co-generation” and “Food processing” as the operating segments:
Sugar - Consists of manufacture and sale of Sugar, Molasses & Bagasse
Spirits - Consists of manufacture and sale of Industrial Spirits (including Denaturants), Fusel Oil & Bio-Compost
Co-generation - Consists of generation and transmission of Power
Food Processing Products - Consists of Canned Fruits & Vegetables, Jams, Jellies, Squashes & Juices
Others – Consist of Miscellaneous business comprising of less than 10% revenues.
(ii) Geographical Segment: The Company primarily operates in India and therefore the analysis of geographical segment is
demarcated into its Indian and Overseas Operations.
(iii) The Company has common fixed assets located in India for producing goods for domestic and overseas markets. Hence,
separate figures for fixed assets/additions thereof cannot be furnished.
21. The Consolidated segment information as at and for the year ended 30th June, 2009 are as below: (Contd.)
(Rs. in Lakhs)
Sugar Spirits Co-
generation
Food
processing
Others Total
22. Related Party Disclosure :
a. Names of the related parties :
Key Management Personnel Mr. Chandra Shekhar Nopany – Chairman-cum-Managing Director Mr. V.P. Singh – Executive President, Hargaon Unit Mr. Chandra Mohan – Executive President, Narkatiaganj UnitMr. B.K. Malpani – Executive President, Rosa Unit
(From 12th September,2008)Mr. P.K. Saini – Executive President, Hata Unit Mr. S.K. Premi – Executive President, Allahabad Unit Mr. Sanjay Mukherjee – Company Secretary (Upto 28th February,2009) Mr. G.N. Pareek – Company Secretary Secretary (From 1st March,2009)
Relatives of Key Management Personnel Mrs. Nandini Nopany – Mother of Shri Chandra Shekhar Nopany
Enterprises owned or significantly influenced
by Key Management Personnel and their
relatives
Upper Ganges Sugar & Industries Ltd.
Sutlej Textiles & Industries Ltd.
SIL Investments Ltd.
SCM Investment & Trading Co. Ltd.RTM
Investment & Trading Co. Ltd.
Uttar Pradesh Trading Co. Ltd.
SCHEDULE to the Consolidated Balance Sheet and Profit & Loss Account (Contd.)SCHEDULE – 23 : ACCOUNTING POLICIES AND NOTES TO ACCOUNTS (Contd.)
The Oudh Sugar Mills Limited (Consolidated)96
(b) Aggregated Consolidated Related Party Disclosures as at and for the year ended 30th June, 2009 (Rs. in Lakhs)
Key Management
Personnel
Relatives of
Key Management
Personnel
Enterprises owned by
Key Management
Personnel or their relatives TotalTransaction
Value
Balance
Outstanding
as on 30.06.
2009
Transaction
Value
Balance
Outstanding
as on 30.06.
2009
Transaction
Value
Balance
Outstanding
as on 30.06.
2009
Transaction
Value
Balance
Outstanding
as on 30.06.
2009
Sale of Goods & Services
Upper Ganges Sugar & Industries Ltd. - - - - 35.38 - 35.38 -
( - ) ( - ) ( - ) ( - ) (206.66) ( - ) (206.66) ( - )
Purchase of Goods & Services
Upper Ganges Sugar & Industries Ltd. - - - - 109.98 - 109.98 -
( - ) ( - ) ( - ) ( - ) (37.17) ( - ) (37.17) ( - )
Sale of Fixed Assets
Upper Ganges Sugar & Industries Ltd. - - - - 21.76 - 21.76 -
( - ) ( - ) ( - ) ( - ) (130.66) ( - ) (130.66) ( - )
Purchase of Fixed Assets
Upper Ganges Sugar & Industries Ltd. - - - - 11.61 - 11.61 -
( - ) ( - ) ( - ) ( - ) (96.11) ( - ) (96.11) ( - )
Interest Paid
Sutlej Textiles & Industries Limited - - - - 199.27 - 199.27 -
( - ) ( - ) (340.24) ( - ) (340.24) ( - )
SIL Investments Ltd. - - - - 73.28 - 73.28 -
( - ) ( - ) ( - ) ( - ) (184.91) ( - ) (184.91) ( - )
SCM Investment & Trading Co. Ltd. - - - - 432.32 - 432.32 -
( - ) ( - ) ( - ) ( - ) (172.05) ( - ) (172.05) ( - )
RTM Investment & Trading Co. Ltd. - - - - 620.88 - 620.88 -
( - ) ( - ) (186.85) ( - ) (186.85) ( - )
Loans/Intercorporate deposits repaid
Sutlej Textiles & Industries Limited - - - - 3,500.00 - 3,500.00 -
( - ) ( - ) ( - ) ( - ) (3,000.00) ( - ) (3,000.00) ( - )
SIL Investments Limited - - - - 1,675.00 - 1,675.00 -
( - ) ( - ) ( - ) ( - ) (250.00) ( - ) (250.00) ( - )
SCM Investment & Trading Co. Ltd. - - - - 855.00 - 855.00 -
( - ) ( - ) ( - ) ( - ) (300.00) ( - ) (300.00) ( - )
RTM Investment & Trading Co. Ltd. - - - - 4,060.00 - 4,060.00 -
( - ) ( - ) ( - ) ( - ) (2,150.00) ( - ) (2,150.00) ( - )
Loans/Intercorporate deposits Taken
Sutlej Textiles & Industries Limited - - - - 500.00 - 500.00 -
( - ) ( - ) ( - ) ( - ) (4,000.00) (3,000.00) (4,000.00) (3,000.00)
SIL Investments Limited - - - - 100.00 - 100.00 -
( - ) ( - ) ( - ) ( - ) (1,300.00) (1,575.00) (1,300.00) (1,575.00)
SCM Investment & Trading Co. Ltd. - - - - 525.00 2,570.00 525.00 2,570.00
( - ) ( - ) ( - ) ( - ) (3,200.00) (2,900.00) (3,200.00) (2,900.00)
RTM Investment & Trading Co. Ltd. - - - - 3,030.00 3,420.00 3,030.00 3,420.00
( - ) ( - ) ( - ) ( - ) (6,600.00) (4,450.00) (6,600.00) (4,450.00)
SCHEDULE to the Consolidated Balance Sheet and Profit & Loss Account (Contd.)SCHEDULE – 23 : ACCOUNTING POLICIES AND NOTES TO ACCOUNTS (Contd.)
Annual Report 2008-09 FINANCIAL STATEMENTS 97
Balance Outstanding (net)
Debit / (-) Credit :
Upper Ganges Sugar & Industries Ltd. - - - - - 52.59 - 52.59
( - ) ( - ) ( - ) ( - ) ( - ) (-48.47) ( - ) (-48.47)
Dividend Received
Sutlej Textiles & Industries Limited - - - - 17.71 - 17.71 -
( - ) ( - ) ( - ) ( - ) (79.80) ( - ) (79.80) ( - )
SIL Investments Limited - - - - 17.58 - 17.58 -
( - ) ( - ) ( - ) ( - ) (17.58) ( - ) (17.58) ( - )
Remuneration
Mr. V.P.Singh 27.22 0.79 - - - - 27.22 0.79
(19.06) (1.18) ( - ) ( - ) ( - ) ( - ) (19.06) (1.18)
Mr. Chandra Mohan 28.56 0.90 - - - - 28.56 0.90
(17.41) (0.90) ( - ) ( - ) ( - ) ( - ) (17.41) (0.90)
Mr. P.K. Saini 11.97 0.90 - - - - 11.97 0.90
(9.61) (0.08) ( - ) ( - ) ( - ) ( - ) (9.61) (0.08)
Mr. S.K. Premi 15.29 0.93 - - - - 15.29 0.93
(12.43) (0.11) ( - ) ( - ) ( - ) ( - ) (12.43) (0.11)
Mr. B.K. Malpani 9.77 1.00 - - - - 9.77 1.00
( - ) ( - ) ( - ) ( - ) ( - ) ( - ) ( - ) ( - )
Mr. Sanjay Mukherjee 8.33 - - - - - 8.33 -
(5.58) (0.18) ( - ) ( - ) ( - ) ( - ) (5.58) (0.18)
Mr. G.N. Pareek 3.14 - - - - - 3.14 -
( - ) ( - ) ( - ) ( - ) ( - ) ( - ) ( - ) ( - )
NOTE : Remuneration paid to Mr. C. S. Nopany, Chairman-cum-Managing Director, is disclosed in Schedule 21 to the Accounts.
(b) Aggregated Consolidated Related Party Disclosures as at and for the year ended 30th June, 2009 (Contd.) (Rs. in Lakhs)
Key Management Personnel
Relatives of Key Management
Personnel
Enterprises owned by
Key Management
Personnel or their relatives Total
Transaction Value
Balance Outstandingas on 30.06.
2009
Transaction Value
Balance Outstandingas on 30.06.
2009
Transaction Value
Balance Outstandingas on 30.06.
2009
Transaction Value
Balance Outstandingas on 30.06.
2009
23. Figures given in brackets are for the previous year and the same have been regrouped and / or rearranged, wherever necessary.
SCHEDULE to the Consolidated Balance Sheet and Profit & Loss Account (Contd.)SCHEDULE – 23 : ACCOUNTING POLICIES AND NOTES TO ACCOUNTS (Contd.)
Signatories to Schedules - 1 to 23
As per our report of even date. For S. R. BATLIBOI & CO.Chartered Accountants
Per R. K. AGRAWALPartnerMembership No. 16667 Place: Kolkata G. N. Pareek Chandra Shekhar Nopany Chairman - cum - Mg. Director Dated: 25th August, 2009 Company Secretary A. C. Dalal Director
The Oudh Sugar Mills Limited (Consolidated)98
DIRECTORS’ REPORTTo
The Shareholders,
Champaran Marketing Co. Ltd.
Your Directors have pleasure in presenting their Report and the
audited Accounts of the Company for the year ended 31st March,
2009.
2. Financial Results : Rs. Rs.
The Profit & Loss Account
shows a profit of10,10,047
To which is added the balance
brought forward from the
previous year
70,95,092
Making a total of 81,05,139
Out of this provisions has been
made for Reserve Fund2,25,000
Balance to be carried forward 78,80,139
3. Dividend :
Your Directors have not recommended any dividend.
4. Directors :
Shri Sanjay Mukherjee resigned from the Directorship of the
Company with effect from 16th April, 2009.
Shri Sunil Lohia retires from the Board by rotation and being
eligible offers himself for re-appointment.
5. Auditors :
The Auditors, Messrs K.P. Gutgutia & Co., Chartered
Accountants, retire and are eligible for re-appointment.
6. Conservation of Energy, Technology Absorption, Foreign
Exchange Earnings and Outgo :
As the Company has no manufacturing activity, it is
not required to furnish any information with regard to
conservation of energy. There is no information to furnish
with regard to technology absorption. During the year, no
foreign exchange was earned or used by the Company.
7. Particulars of Employees :
The provisions of Section 217 (2A) of the Companies Act,
1956 are not applicable to the Company as there is no
employee.
8. Directors’ Responsibility Statement :
Your Directors confirm that -
i) in preparation of the annual accounts, the applicable
accounting standards have been followed along with
proper explanation relating to material departures;
ii) they have selected such accounting policies and applied
them consistently and made judgements 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 of the
Company for that year;
iii) they have taken proper and sufficient care for the
maintenance of adequate accounting records in
accordance with the provisions of the Companies
Act, 1956 for safeguarding the assets of the Company
and for preventing and detecting fraud and other
irregularities;
iv) they have prepared the annual accounts on a going
concern basis.
9. Compliance Certificate :
A copy of the Compliance Certificate from Messrs A.M.
Bubna & Associates, Company Secretaries, as required under
Section 383A of the Companies Act, 1956 is attached and
forms a part of this Report.
9/1, R.N. Mukherjee Road,
Kolkata - 700 001 R. N. JHUNJHUNWALA
Dated : 16th April, 2009 T. R. CHACHAN Directors
Annual Report 2008-09 FINANCIAL STATEMENTS 99
COMPLIANCE CERTIFICATETo
The Members
We have examined the registers, records, books and papers of
Champaran Marketing Company Limited (the Company) as required
to be maintained under the Companies Act, 1956, (the Act) and
the rules made thereunder and also the provisions contained in
the Memorandum and Articles of Association of the Company for
the financial year ended on 31st March, 2009 (Financial year). In
our opinion and to the best of our information and according to
the examinations carried out by us and explanations furnished
to us by the Company, its officers and agents, we certify that in
respect of the aforesaid financial year:
1. The Company has kept and maintained all registers as stated
in Annexure ‘A’ to this certificate, as per the provisions of
the Act and the rules made thereunder and all entries therein
have been duly recorded.
2. The Company has duly filed the forms and returns as stated
in Annexure ‘B’ to this certificate, with the Registrar of
Companies within the time prescribed under the Act and the
rules made thereunder.
3. The Company, being a public limited company, clause 3 is
not applicable.
4. The Board of Directors duly met 6 (Six) times respectively
on 16th April, 2008, 2nd June, 2008, 23rd June, 2008, 24th
September, 2008, 3rd October, 2008 & 27th January, 2009
in respect of which meetings proper notices were given and
the proceedings were properly recorded and signed in the
Minutes Book maintained for the purpose.
5. The Company was not required to close its Register of
Members during the financial year since it is not listed with
any stock exchange.
6. The Annual General Meeting for the financial year ended
on 31st March, 2008 was held on 16th June, 2008 after
giving due notice to the members of the Company and the
resolutions passed thereat were duly recorded in Minutes
Book maintained for the purpose.
7. No Extra Ordinary General Meeting was held during the
financial year.
8. The Company has not advanced any loans to its directors or
persons or firms or companies referred to under Section 295
of the Act.
9. The Company has not entered into any contracts falling
within the purview of Section 297 of the Act.
10. The Company has made necessary entries in the register
maintained under Section 301 of the Act.
11. As there were no instances falling within the purview of
Section 314 of the Act the Company was not required to
obtain any approvals from the Board of Directors, members
or Central Government.
12. The Company has not issued any duplicate share certificates
during the financial year.
13. The company has :
a. not allotted/ transferred/ transmitted securities during
the financial year.
b. not deposited any amount in a separate Bank Account
as no dividend was declared during the financial year.
c. not posted warrants to any member of the Company as
no dividend was declared during the financial year.
d. no amount in unpaid dividend account, application
money due for refund, matured deposits, matured
debentures and the interest accrued thereon and as
such it was not required to transfer any amount to
Investor Education and Protection Fund.
e. duly complied with the requirements of section 217 of
the Act.
14. The Board of Directors of the Company is duly constituted
and the appointment of a director was duly made.
15. The Company has not appointed any Managing Director/
Whole-time Director / Manager during the financial year as
there was no need to do so.
16. The Company has not appointed any sole-selling agents
during the financial year.
17. The Company was not required to obtain any approvals of
the Central Government, Company Law Board, Regional
Director, Registrar of Companies or such other authorities
as may be prescribed under the various provisions of the Act
during the financial year.
18. The Directors have disclosed their interest in other firms/
companies to the Board of Directors pursuant to the
provisions of the Act and the rules made thereunder.
19. The Company has not issued any shares, debentures or other
securities during the financial year.
20. The Company has not bought back any shares during the
financial year.
Champaran Marketing Company Limited 100
COMPLIANCE CERTIFICATE (Contd.)
21. The Company has not redeemed any Preference shares during
the financial year.
22. There were no transactions necessitating the Company to
keep in abeyance the rights to dividend, rights shares and
bonus shares pending registration of transfer of shares.
23. The Company has not invited / accepted any deposits under
Section 58A of the Act during the financial year.
24. The Company has not made any borrowings during the
financial year ended 31st March, 2009.
25. The provisions of Section 372 A are not applicable to the
Company as its principal business is acquisition of shares,
stocks, debentures or other securities.
26. The Company has not altered the provisions of the
Memorandum with respect to the situation of the Company’s
registered office from one state to another during the year
under scrutiny.
27. The Company has not altered the provisions of the
Memorandum with respect to the objects of the Company
during the year under scrutiny.
28. The Company has not altered the provisions of the
Memorandum with respect to name of the Company during
the year under scrutiny.
29. The Company has not altered the provisions of the
Memorandum with respect to share capital of the Company
during the year under scrutiny.
30. The Company has not altered its Articles of Association
during the financial year.
31. There was no prosecution initiated against or show cause
notices received by the Company and no fines or penalties or
any other punishment was imposed on the Company during
the financial year for offences under the Act.
32. Since the Company has no employees, it didn’t receive any
money as security from its employees during the financial
year.
33. Since the Company has no employees, the provisions of EPF
& Miscellaneous Provisions Act, 1952 are not applicable,
consequently it was not required to deduct any contribution
towards Provident Fund during the financial year.
Annexure A
Registers / Records as maintained by the Company
1. Register of Transfers u/s 108/111.
2. Register of Members u/s 150.
3. Minutes Book of Board Meetings u/s 193.
4. Minutes Book of General Meetings u/s 193.
5. Books of Accounts u/s 209.
6. Register of Contracts, Companies and firms in which
directors are interested u/s 301.
7. Register of Directors, Managing Director, Manager and
Secretary u/s 303.
8. Register of Directors’ Shareholding u/s 307.
9. Register of Loans & Investments.
10. Application for and allotment of shares.
11. Copies of Annual Return u/s 163
Annexure B
Forms and Returns as filed by the Company with Registrar of
Companies (ROC), Regional Director, Central Government or other
authorities during the financial year ended 31st March, 2009.
1. Balance Sheet in Form No. 23AC along with Profit and Loss
Account in Form 23ACA Filed u/s 220 on 09.07.2008 for the
financial year ended on 31.03.2008 with R.O.C.
2. Compliance Certificate in Form No. 66 filed u/s 383A on
08.07.2008 for the financial year ended on 31.03.2008 with
R.O.C.
3. Annual Return in Form No.20B Filed u/s 159 on 1.08.2008
made upto 16.06.2008 with R.O.C.
For A.M. BUBNA & ASSOCIATES (Company Secretaries)105, Cotton Street Name of the Co. Secretary : Ashish BubnaKolkata - 700 007 (Partner)Dated : 16th April, 2009 C.P. No. 3569
Annual Report 2008-09 FINANCIAL STATEMENTS 101
AUDITORS’ REPORT
To
The Members,
1. We have audited the attached Balance Sheet of Champaran
Marketing Company Limited as at 31st March, 2009 and
the Profit & Loss Account for the year ended on that
date annexed thereto. These financial statements are
the responsibility of the Company’s management. Our
responsibility is to express an opinion on these financial
statements based on our audit.
2. We conducted our audit in accordance with the auditing
standards generally accepted in India. Those standards require
that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free
of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures
in the financial statements. An audit also includes assessing
the accounting principles used and significant estimates
made by the management, as well as evaluating the overall
financial statement presentation. We believe that our audit
provides a reasonable basis for our opinion.
3. As required by the Companies (Auditor’s Report) Order, 2003
(as amended), issued by the Central Government of India in
terms of sub-section (4A) of Section 227 of the Companies
Act, 1956, we enclose in the annexure, a statement on the
matters specified in paragraphs 4 & 5 of the said Order.
4. Further to our comments in the Annexure referred to above,
we report that :-
i) We have obtained all the information and
explanations, which to the best of our knowledge and
belief, were necessary for the purposes of our audit.
ii) In our opinion, proper books of account as required
by law have been kept by the Company, so far as
appears from our examination of those books.
iii) The Balance Sheet and the Profit & Loss Account,
dealt with by this report, are in agreement with the
books of account as submitted to us.
iv) In our opinion, the Balance Sheet and Profit & Loss
Account dealt with by this report comply with the
Accounting Standards referred to in sub-section (3C)
of Section 211 of the Companies Act, 1956.
v) On the basis of written representations received from
the Directors as on 31st March, 2009 and taken on
record by the Board of Directors, we report that none
of the directors is disqualified as on 31st March, 2009
from being appointed as director in terms of clause
(g) of sub-section (1) of Section 274 of the Companies
Act, 1956.
vi) In our opinion and to the best of our information and
according to the explanations given to us, the said
accounts read together with the notes thereon, give
the information required by the Companies Act, 1956
in the manner so required and give a true and fair
view in conformity with the accounting principles
generally accepted in India :-
a) in the case of the Balance Sheet, of the state
of affairs of the Company, as at 31st March,
2009; and
b) in the case of the Profit & Loss Account, of the
Profit of the Company for the year ended on
that date.
For K.P. GUTGUTIA & CO.
Chartered Accountants
2, Princep Street (K.P. GUTGUTIA)
Kolkata - 700 072 Proprietor
Dated : 16th April, 2009 Membership No. 7250
Champaran Marketing Company Limited 102
1. The Company has no fixed assets, as such the question of maintenance of fixed assets records and physical verification thereof does not arise.
2. The Company has no manufacturing and / or trading activities and as such the question of having any stock and maintenance of records in respect thereof and physical verification of inventory does not arise.
3. The Company has not taken / granted any loans, secured or unsecured, from/to companies, firms or other parties covered in the register maintained under Section 301 of the Companies Act, 1956.
4. The Company has not purchased any goods and fixed assets and also there is no sale of goods and services during the year and as such the question of having any internal control system with regard to purchase of inventory, fixed assets and sale of goods does not arise.
5. There was no transaction which required to be entered in the register in pursuance of Section 301 of the Companies Act, 1956.
6. The Company has not accepted any deposits from the public.
7. The internal audit was conducted by a service company and in our opinion the internal audit system is commensurate with the size of the Company and the nature of its business.
8. The Company is not required to maintain any cost records under Section 209(1)(d) of the Companies Act, 1956.
9. The Company has been regular in depositing undisputed
statutory dues with the appropriate authorities as applicable.
As the Company has no employee and no manufacturing
and/or trading activities are carried on by the Company the
question of payment of provident fund, employees’ state
insurance, sales-tax, customs duty, excise duty, service tax,
cess, etc., does not arise. According to the information and
explanations given to us no undisputed amounts payable in
respect of statutory dues were outstanding as at 31st March,
2009 for a period of more than six months from the date
they became payable. There are no dues outstanding in
respect of statutory dues on account of any dispute.
10. The Company has no accumulated losses at the end of the financial year and it has not incurred any cash losses in the current and immediate preceding financial year.
11. In our opinion and according to the information and explanations given to us, the Company has not taken any
loan from financial institutions, bank or debenture holders, as such, the question of any default in repayment does not arise.
12. The Company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and other securities.
13. In our opinion and according to the information and explanations given to us, the nature of activities of the Company does not attract any special statute applicable to chit fund and nidhi / mutual benefit fund / societies.
14. In respect of dealing in shares, securities, debentures and other investments, in our opinion and according to the information and explanations given to us, proper records have been maintained of the transactions and contracts and timely entries have been made therein. The shares, securities, debentures and other investments have been held by the Company in its own name.
15. The Company has not given any guarantee for loans taken by others from banks and financial institutions.
16. The Company has not taken any term loan from any financial institutions or bank. The Company does not have any borrowing by way of debentures.
17. We have been informed by the management that no funds were raised either on short term basis or on long term basis.
18. The Company has not made any preferential allotment of shares to parties and companies covered in the register maintained under Section 301 of the Companies Act, 1956.
19. The Company has not issued any debentures during the year.
20. The Company has not raised any money through a public issue during the year.
21. Based upon the audit procedures performed and as per the information and explanations given by the management, we report that no fraud on or by the Company has been noticed or reported during the course of our audit.
For K.P. GUTGUTIA & CO.
Chartered Accountants
2, Princep Street (K. P.GUTGUTIA)
Kolkata - 700 072 Proprietor
Dated : 16th April, 2009 Membership No. 7250
ANNEXURE REFERRED to in Paragraph 3 of our Report of Even Date
Annual Report 2008-09 FINANCIAL STATEMENTS 103
BALANCE SHEETas at 31st March, 2009
SCHEDULE 31st March, 2009
Rs.
31st March, 2008
Rs.
SOURCES OF FUNDS
Shareholders’ Fund
Share Capital 1 1,08,72,500 1,08,72,500
Reserves & Surplus 2 3,98,50,139 3,88,40,092
5,07,22,639 4,97,12,592
Loan
Unsecured Loan
The Oudh Sugar Mills Ltd.,
The holding company (not bearing interest) 22,00,000 32,50,000
22,00,000 32,50,000
5,29,22,639 5,29,62,592
APPLICATION OF FUNDS
Investments 3 5,29,15,352 5,29,15,352
Current Assets, Loans & Advances
Current Assets 4 15,287 53,240
15,287 53,240
Less : Current Liabilities & Provisions 5
Current Liabilities 8,000 6,000
Provisions - -
8,000 6,000
Net Current Assets 7,287 47,240
5,29,22,639 5,29,62,592
Accounting Policies and Notes on Accounts 7
In terms of our attached Report of even date.
For K.P. GUTGUTIA & CO.
Chartered Accountants
2, Princep Street (K. P.GUTGUTIA)
Kolkata - 700 072 Proprietor R. N. JHUNJHUNWALADated : 16th April, 2009 Membership No. 7250 T. R. CHACHAN Directors
Champaran Marketing Company Limited 104
PROFIT & LOSS ACCOUNTfor the year ended 31st March, 2009
SCHEDULE 2008-2009
Rs.
2007-2008
Rs.
INCOME
Dividend 11,05,852 18,14,342
11,05,852 18,14,342
EXPENDITURE
Directors’ Fees 4,600 4,000
Other Expenses 6 91,205 78,167
95,805 82,167
Profit before Taxation 10,10,047 17,32,175
Less : Provision for Taxation - 8,399
Profit after Taxation 10,10,047 17,23,776
Add : Balance brought forward from last year 70,95,092 57,21,316
Profit available for Appropriation 81,05,139 74,45,092
APPROPRIATIONS
Transfer to Reserve Fund 2,25,000 3,50,000
Balance carried to Balance Sheet 78,80,139 70,95,092
81,05,139 74,45,092
In terms of our attached Report of even date.
SCHEDULES to the Balance Sheet
31st March, 2009
Rs.
31st March, 2008
Rs.
SCHEDULE - 1 : SHARE CAPITALAuthorised
6,406 Ordinary Shares of Rs. 10 each 64,060 64,060
59,74,376 Ordinary Shares of Rs. 2.50 each 1,49,35,940 1,49,35,940
2,50,000 Peference Shares of Rs. 10 each 25,00,000 25,00,000
1,75,00,000 1,75,00,000 Issued
43,50,000 Ordinary Shares of Rs. 2.50 each 1,08,75,000 1,08,75,000
1,08,75,000 1,08,75,000 Subscribed & Paid-up
43,49,000 Ordinary Shares of Rs. 2.50 each fully
paid up 1,08,72,500 1,08,72,500
1,08,72,500 1,08,72,500
Notes : 1) Out of 43,49,000 Ordinary Shares 1,08,750 Shares have been allotted as fully paid Bonus Shares by capitalisation of General Reserve.2) The entire Subscribed Ordinary Share Capital is held by The Oudh Sugar Mills Ltd., the holding company.
For K.P. GUTGUTIA & CO.
Chartered Accountants
2, Princep Street (K. P.GUTGUTIA)
Kolkata - 700 072 Proprietor R. N. JHUNJHUNWALADated : 16th April, 2009 Membership No. 7250 T. R. CHACHAN Directors
Annual Report 2008-09 FINANCIAL STATEMENTS 105
SCHEDULES to the Balance Sheet (Contd.)
31st March, 2009
Rs.
31st March, 2008
Rs.
SCHEDULE - 2 : RESERVES & SURPLUSShare Premium Account
As per last Account 86,95,000 86,95,000 Reserve Fund
As per last Account 60,50,000 57,00,000 Add : Transfer from Profit & Loss Account 2,25,000 3,50,000
62,75,000 60,50,000 General Reserve
As per last Account 1,50,00,000 1,50,00,000 Capital Redemption Reserve
As per last Account 20,00,000 20,00,000 Surplus as per Profit & Loss Account 78,80,139 70,95,092
3,98,50,139 3,88,40,092
No. of SharesFace Value
Rs.31st March, 2009
Rs.31st March, 2008
Rs.
SCHEDULE - 3 : INVESTMENTS (At Cost)LONG TERM
Quoted
Equity Shares (Fully Paid)
Chambal Fertilisers & Chemicals Ltd. 3,02,500 10 55,00,000 55,00,000
New India Retailing & Investment Ltd. 94,077 10 75,23,560 75,23,560
Upper Ganges Sugar & Industries Ltd. 2,60,841 10 1,95,59,479 1,95,59,479
SIL Investments Ltd. 1,99,773 10 38,14,988 38,14,988
Sutlej Textiles & Industries Ltd. 2,06,540 10 64,41,985 64,41,985
Manavta Holdings Ltd. 72,000 10 3,52,755 3,52,755
4,31,92,767 4,31,92,767 UnquotedEquity Shares (Fully Paid)
Taparia Ltd. 3,500 10 40,105 40,105
Shree Vihar Properties Ltd. 7,47,692 10 65,76,920 65,76,920
Modern Diagen Services Ltd. 10,556 10 1,05,560 1,05,560
Hargaon Properties Ltd. 2,00,000 10 20,00,000 20,00,000
Leas Communications Ltd. (Value written off) 21,000 10 - -
Chandausi Rice Mills Ltd. (Value written off) 1,000 10 - -
Swadeshi Jute Machinery Corporation
Ltd.(In liquidation) (Value written off) 15,000 10 - -
Maruti Ltd. (In liquidation) (value written off) 10,000 10 - -
87,22,585 87,22,585 Equity Shares (Partly Paid)
Modern Diagen Services Ltd. 5,00,000 2 10,00,000 10,00,000
97,22,585 97,22,585 5,29,15,352 5,29,15,352
Aggregate Book Value of Quoted Investments 4,31,92,767 4,31,92,767 Aggregate Book Value of Unquoted Investments 97,22,585 97,22,585
5,29,15,352 5,29,15,352 Market Value of Quoted Investments 4,10,28,318 7,21,74,630
Champaran Marketing Company Limited 106
SCHEDULES to the Balance Sheet (Contd.)
SCHEDULES to the Profit & Loss Account
31st March, 2009
Rs
31st March, 2008
Rs.SCHEDULE - 4 : CURRENT ASSETSCash & Bank Balances
With Scheduled Banks on Current Accounts 15,287 53,240 15,287 53,240
SCHEDULE - 5 : CURRENT LIABILITIES & PROVISIONSCurrent Liabilities
Sundry Creditors for Expenses 8,000 6,000 8,000 6,000
Provisions For Taxation - - For Proposed Dividend - - For Dividend Tax - -
- - 8,000 6,000
2008 - 2009
Rs.
2007 - 2008
Rs.
SCHEDULE - 6 : OTHER EXPENSES Rates & Taxes 7,300 7,300 Service Charges 49,439 44,944 General Charges 12,521 19,423 Auditors’ Remuneration :
As Audit Fees 8,000 6,000 For Certificate etc. 13,945 500
91,205 78,167
1. Accounting Policies
a) Recognition of Income & Expenditure :
Income & Expenditure are recognised on accrual basis.
b) Investments :
Long-term Investments are considered at cost on individual basis, unless there is permanent decline in value thereof, in which case adequate provision is made against the diminution in the value of Investments.
2. Diminution of Rs. 93.08 lakhs in the value of certain quoted investments based on the last quoted price, has not been provided as the break up value of the said shares supplemented by the market value as on 30th June, 2008, of the quoted investments held by the investee company, is much higher than the corresponding Book Value.
3. The Company has given undertaking to financial institution/bank not to transfer, assign, pledge, charge or create any lien or otherwise dispose of its shareholdings present or future in Damanganga Processors Ltd., without their prior approval in writing till the financial assistance provided by them to the said companies remain outstanding.
4. The Company has pledged 1,99,773 equity shares of Sutlej Textiles & Industries Ltd., 2,59,923 equity shares of Upper Ganges Sugar & Industries Ltd. and 3,02,500 equity shares of Chambal Fertilisers & Chemicals Ltd. during the year in favour of The Bank of Rajasthan Ltd., as a security against loan of Rs. 900 lakhs, granted to The Oudh Sugar Mills Ltd., the holding Company. The said loan is repayable in two equal instalments of Rs. 450 Lakhs each in August & September, 2009.
Signatories to Schedules - 1 to 7
SCHEDULE - 7 : ACCOUNTING POLICIES AND NOTES ON ACCOUNTS
For K.P. GUTGUTIA & CO.Chartered Accountants
2, Princep Street (K. P.GUTGUTIA)Kolkata - 700 072 Proprietor R. N. JHUNJHUNWALADated : 16th April, 2009 Membership No. 7250 T. R. CHACHAN Directors
Annual Report 2008-09 FINANCIAL STATEMENTS 107
BALANCE SHEET ABSTRACTand Company’s General Business Profile
I. Registration Details
Registration No. U15424WB1951PLC019451 State Code 21
Balance Sheet Date 31.03.2009
II. Capital raised during the year (Amount in Rs. Thousands)
Public Issue Nil Rights Issue Nil
Bonus Issue Nil Private Placement Nil
III. Position of Mobilisation and Deployment of Funds : (Amount in Rs. Thousands)
Total Liabilities 52,923 Total Assets 52,923
Sources of Funds Application of Funds
Paid-up Capital 10,873 Net Fixed Assets Nil
Reserves & Surplus 39,850 Investments 52,916
Secured Loans Nil Net Current Assets 7
Unsecured Loans 2,200 Miscellaneous Expenditure Nil
Accumulated Losses Nil
IV. Performance of Company (Amount in Rs. Thousands)
Turnover 1,106 Total Expenditure 96
Profit before tax 1,010 Profit after Tax 1,010
Earning per share (Rs.) 0.23 Dividend Rate Nil
V. Generic Names of Principal Products / Services of the Company
(As per monetary terms)
Item Code No. (ITC Code) Not Applicable
Product Description
R.N. JHUNJHUNWALADirectors
T.R. CHACHAN
Champaran Marketing Company Limited 108
SCHEDULE
to the Balance Sheet of a Non-Banking Financial Company(As required in terms of paragraph 9BB of Non-Banking Financial Companies Prudential Norms (Reserve Bank) Directions, 1998)
Rs. in LakhsPARTICULARS Amount
outstanding(As on
31.03.2009)
Amountoverdue
(As on 31.03.2009)
Liabilities Side : 1) Loans and Advances availed by
the NBFC’S inclusive of interestaccrued thereon but not paid :
(a) Debentures :Secured Nil NilUnsecured Nil Nil(Other than falling withinthe meaning of PublicDeposits)
(b) Deferred Credits Nil Nil(c) Term Loans Nil Nil(d) Inter-Corporate Loans and
BorrowingsNil Nil
(e) Commercial Paper Nil Nil(f) Other Loans (specify nature) 22.00 22.00
4) Break-up of Investments : Current Investments : 1. Quoted :
(i) Shares :(a) Equity Nil (b) Preference Nil
(ii) Debentures and Bonds Nil(iii) Units of Mutual Funds Nil(iv) Government Securities Nil(v) Others (please specify) Nil
2. Unquoted :(i) Shares :
(a) Equity Nil(b) Preference Nil
(ii) Debentures and Bonds Nil(iii) Units of Mutual Funds Nil(iv) Government Securities Nil(v) Others (please specify) Nil
Long Term Investments : 1. Quoted :
(i) Shares :(a) Equity 431.93(b) Preference Nil
(ii) Debentures and Bonds Nil(iii) Units of Mutual Funds Nil(iv) Government Securities Nil(v) Others (please specify) Nil
2. Unquoted :(i) Shares :
(a) Equity 97.23(b) Preference Nil
(ii) Debentures and Bonds Nil(iii) Units of Mutual Funds Nil(iv) Government Securities Nil(v) Others (please specify) Nil
5) Borrower group-wise classification of Assets financed as in (2) and (3) above : Category Amount net of provisions
Secured Unsecured Total1. Related Parties
(a) Subsidiaries Nil Nil Nil(b) Companies
in the same groupNil Nil Nil
(c) Other related parties Nil Nil Nil2. Other than related parties Nil Nil Nil
Total Nil Nil Nil
Amount outstanding
Assets Side : 2) Break-up of Loans and Advances
including Bills receivables (otherthan those included in (4) below)
(a) Secrued Nil(b) Unsecured Nil
3) Break-up of Leased Assets andStock on Hire and other assetscounting towards AFC activitiesi) Lease Assets including lease
rentals under sundry debtors : (a) Financial Lease Nil(b) Operating Lease Nil
ii) Stock on hire including hirecharges under sundry debtors :(a) Assets on Hire Nil(b) Repossessed Assets Nil
iii) Other Loans counting towards AFCactivities : (a) Loans where assets have been
repossessed Nil
(b) Loans other than (a) above Nil
6) Investor group-wise classification of all Investments (current and long term) in shares and securities (both quoted and unquoted) : Category Market Value/
Break-up orFair value or
NAV
Book Value(Net of
Provisions)
1. Related Parties (a) Subsidiaries Nil Nil(b) Companies in the same
group Nil Nil
(c) Other related parties Nil Nil2. Other than related parties 526.60 529.15
Total 526.60 529.15
7) Other InformationParticulars Amounti) Gross Non-Performing Assets
(a) Related parties Nil(b) Other than related parties Nil
ii) Net Non-Performing Assets (a) Related parties Nil(b) Other than related parties Nil
iii) Assets acquired in satisfaction of debt Nil
Rs. in Lakhs
R.N. JHUNJHUNWALADirectors
T.R. CHACHAN
Annual Report 2008-09 FINANCIAL STATEMENTS 109
To
The Shareholders,
OSM Investment & Trading Co. Ltd.
Your Directors have pleasure in presenting their Report
and the audited Accounts of the Company for the year ended
31st March, 2009.
Rs. Rs.2. Financial Results :
The Profit & Loss Account shows a profit of
10,63,539
To which is added :
Balance brought forward
from the previous year 1,15,87,129
Income tax refund received
in respect of an earlier year 1,160 1,15,88,289
Making a total of 1,26,51,828
Out of this provisions has been
made for Reserve Fund2,13,000
Balance to be carried forward 1,24,38,828
3. Dividend :
Your Directors have not recommended any dividend.
4. Directors :
Shri C. S. Nopany resigned from the Chairmanship
& Directorship of the Company with effect from
22nd September, 2008. The Board placed on record its highest
appreciation for the invaluable advices and services rendered
by Shri Nopany during his tenure as a Director and Chairman
of the Company.
Shri T. R. Chachan retires from the Board by rotation and is
eligible for re-appointment.
5. Auditors :
The Auditors, Messrs R. L. Agarwalla & Co., Chartered
Accountants, retire and are eligible for re-appointment.
6. Conservation of Energy, Technology Absorption, Foreign
Exchange Earnings and Outgo :
As the Company has no manufacturing activity, it is
not required to furnish any information with regard to
conservation of energy. There is no information to furnish
with regard to technology absorption. During the year, no
foreign exchange was earned or used by the Company.
7. Particulars of Employees :
The provisions of Section 217 (2A) of the Companies Act,
1956 are not applicable to the Company as there is no
employee.
8. Directors’ Responsibility Statement :
Your Directors confirm that -
i) in preparation of the annual accounts, the applicable
accounting standards have been followed along with
proper explanation relating to material departures;
ii) they have selected such accounting policies and applied
them consistently and made judgements 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 of the
Company for that year;
iii) they have taken proper and sufficient care for the
maintenance of adequate accounting records in
accordance with the provisions of the Companies
Act, 1956 for safeguarding the assets of the Company
and for preventing and detecting fraud and other
irregularities;
iv) they have prepared the annual accounts on a going
concern basis.
9. Auditors Report :
As regards Auditors observations in their Report the notes to
the Accounts should be referred to.
10. Compliance Certificate:
A copy of the Compliance Certificate from Messrs S.M. Gupta
& Co., Company Secretaries, as required under Section 383A
of the Companies Act, 1956 is attached and forms a part of
this Report.
9/1, R.N. Mukherjee Road,
Kolkata - 700 001 T.R. CHACHANDirectors
Dated : 1st June, 2009 A.L. TULSIAN
DIRECTORS’ REPORT
OSM Investment & Trading Company Limited 110
COMPLIANCE CERTIFICATETo,
The Members
We have examined the registers, records, books and papers of
OSM Investment & Trading Company Limited (the Company) as
required to be maintained under the Companies Act, 1956 (the
Act) and the Rules made thereunder including the Report of
the Statutory Auditors under the Companies (Auditor’s Report)
Order, 2003 as amended and also the provisions contained in the
Memorandum and Articles of Association of the Company for the
financial year ended on 31st March, 2009. In our opinion and to
the best of our knowledge, belief and information and according
to the examinations carried out by us and explanations furnished
to us by the Company, its officers and agents, we certify that in
respect of the aforesaid financial year :
1. The Company has kept and maintained registers as stated in Annexure A to this certificate, as per the provisions of the Act and the Rules made thereunder and all entries therein have been recorded.
2. The Company has filed the forms and returns as stated in Annexure B to this certificate, with the Registrar of Companies as required under the Act and the Rules made thereunder.
3. The Company being a Public Limited Company, Clause No. 3 is not applicable.
4. The Board of Directors met 6 times on 16.04.2008, 02.06.2008, 24.09.2008, 03.10.2008, 17.12.2008 and 23.03.2009 in respect of which meetings proceedings were recorded and signed in the Minutes Book maintained for the purpose. As informed to us, no circular resolution was passed during the financial year.
5. The Company was not required to close its Register of Members during the financial year since it is not listed with any Stock Exchange.
6. The Annual General Meeting for the financial year ended on 31.03.2008 was held on 28.07.2008 after giving notice to the members of the Company and the resolutions passed thereat were recorded in Minutes Book maintained for the purpose.
7. No Extra Ordinary General Meeting was held during the financial year.
8. The Company during the financial year has not advanced any loan to its Directors and / or persons or Firms or Companies referred to in Section 295 of the Act.
9. The Company has not entered into any contract falling within the purview of Section 297 of the Act, as informed to us by the Management.
10. The Company is making necessary entries in the register maintained under Section 301 of the Act as and when required.
11. As there were no instances falling within the purview of Section 314 of the Act, the Company was not required to
obtain any approvals under the said Section.
12. No duplicate share certificates were issued during the
financial year, as per the records of the Company.
13. The Company :
(i) has been delivering the certificates on lodgment
thereof for transfer / transmission or any other purpose
as and when it receives the same;
(ii) has not declared dividend for the financial year ended
31.3.2008;
(iv) has no amount lying in unpaid/unclaimed dividend
account; and
(v) has generally complied with the requirements of
Section 217 of the Act.
14. The Board of Directors of the Company is duly constituted.
15. The Company is not required to appoint a Managing Director,
Whole-time Director or Manager under Section 269 of the
Act as its paid up Capital is less than Rs. 5 crores.
16. The Company did not appoint any sole selling agent during
the financial year.
17. We have been informed by the Management that the
Company, during the financial year, was not required to
obtain the approval of any authority under the provisions of
the Act.
18. The Directors have disclosed their interest in other
Firms / companies to the Board of Directors pursuant to the
provisions of the Act and the Rules made thereunder.
19. The Company has not issued any security during the financial
year.
20. The Company has not bought back any shares during the
financial year.
21. Since the Company has not issued Preference
Shares / Debentures, there was no redemption during the
year under review.
22. As informed to us, the Company during the financial year,
was not required to keep in abeyance rights to any benefits
on shares pending completion of formalities under the
provisions of the Act.
23. The Company has not accepted any deposits from the public.
(Refer Auditors’ Report)
24. The Company did not borrow any money during the
financial year.
25. The Company being a Non – Banking Financial Company
registered under Section 45 IA of the Reserve Bank of India
Act, 1934 is exempt from the provisions of Section 372A of
the Act.
26 The Company, during the financial year, has not altered the
to provisions of the Memorandum with respect to :
29 (a) situation of registered office of the Company
&(iii)
Annual Report 2008-09 FINANCIAL STATEMENTS 111
COMPLIANCE CERTIFICATE (Contd.) (b) the objects of the Company
(c) name of the Company
(d) share capital of the Company
30. The Company has not altered its Articles of Association during the financial year.
31. As informed to us, during the financial year, no prosecution was initiated against or show cause notice received by the
Company for any alleged offence under the provisions of the Act.
32. Since the Company has no employee, it has not received any money as security during the financial year.
33. The provisions of Provident Fund Act are not applicable to the Company, as it has no employee. (Refer Auditors’ Report)
Annexure A
Sl.
No.
Registers/Records as maintained by the Company
Statutory Registers/Records
Under Section
1. Register of Investments 49(7)
2. Register of Charges 143
3. Register of Members 150
4. Copies of Annual Returns etc. 163
5. Minutes of Board Meetings 193
6. Minutes of General Meetings 193
7. Books of Accounts 209
8. Register of Contracts 301
9. Particulars of Directors etc. 303
10. Register of Directors’ shareholding 307
11. Register of Loans and Investments etc. 372A
Other Registers
12. Register of Share Transfers 108/111
13. Register of Notices received from Directors 299
14. Register of Fixed Assets
Annexure B
Forms and Returns as filed by the Company with the Registrar of Companies, West Bengal during the financial year ended 31st March,
2009:
Sl. No. FormNo Under Section For Date of filing
1. Form 23AC & 23ACA 220 Form for filing Balance Sheet and Profit & Loss Account for
Financial year ended on 31.03.2008
12.08.2008
2. Form 66 383A Form for filing of Compliance Certificate for Financial year ended
31.03.2008
12.08.2008
3. Form 20B 159 Form for filing of Annual Return made upto 28.07.2008 19.09.2008
4. Form 32 303(2) Resignation of Mr. C. S. Nopany from the Chairmanship &
Directorship of the Company w.e.f. 22.09.2008
01.10.2008
Place : P-15, Bentinck Satreet,
Kolkata - 700 001 Signature : S. M. Gupta
Dated : 1st June, 2009 Name of Company Secretary : S. M. GUPTA
C. P. No. : 2053
OSM Investment & Trading Company Limited 112
AUDITORS’ REPORT
To The MembersOMS Invesment & Trading Co. Ltd.1. We have audited the attached Balance Sheet of OSM Investment
& Trading Company Limited as at 31st March, 2009 and also the Profit & Loss Account for the year ended on that date annexed thereto. These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements based on our audit.
2. We conducted our audit in accordance with the auditing standards generally accepted in India. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatements. An audit includes examining, on a test basis, evidence supporting the amounts and disclosure in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by the management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.
3. As required by the Companies (Auditor’s Report) Order 2003 (as amended), issued by the Central Government of India in terms of sub-section(4A) of section 227 of the Companies Act,1956, we enclose in the annexure, a statement on the matters specified in paragraphs 4 & 5 of the said order.
4. Further we reported that:- i) We have obtained all the information and
explanations, which to the best of our knowledge and belief were necessary for the purposes of our audit;
ii) In our opinion, proper books of account as required by the Laws have been kept by the Company, so far as appears from our examination of those books;
iii) The Balance Sheet and the Profit & Loss Account dealt with by this report, are in agreement with the
books of account as submitted to us; iv) In our opinion, the Balance Sheet and profit & Loss
account dealt with by this report comply with the accounting standards referred to in sub-section (3C) of section 211of the Companies Act, 1956;
v) On the basis of written representations received from the directors, as on 31st March, 2009 and taken on record by the Board of Directors, we report that none of the Directors is disqualified as on 31st March, 2009 from being appointed as a director in term of clause (g) of sub-section (1) of section 274 of the Companies Act, 1956.
vi) In our opinion and to the best of our information and according to the explanations given to us, the said accounts subject to Note No. 3 on Schedule- 6, regarding non-provision for diminution of market value of quoted investments amounting to Rs. 113.77 lakhs, as in the opinion of the management the break-up value of those investments are higher than the corresponding book value , whose impact on the Company’s profit/reserves is not presently ascertainable and read together with Notes thereon and attached thereto give the information required by the Companies Act, 1956 in the manner so required and give a true and fair view in conformity with the accounting principals generally accepted in India:
a) in the case of the Balance Sheet, of the state of affairs of the Company as at 31st March, 2009; and
b) in the case of the Profit & Loss Account, of the profit for the year ended on that date.
For R.L. AGARWALLA & CO.
7, Rabindra Sarani Chartered Accountants
Kolkata – 700 001 R. L. AGARWALLA
Dated : 1st June, 2009 Proprietor
Membership No. 50516
(i) The Company has maintained proper records of fixed assets showing full particulars, including quantitative details and situation thereof. Fixed Assets have been physically verified by the management during the year and no material discrepancies were noticed on such verification. There was no substantial disposal of fixed assets during the year.
(ii) The Company has no manufacturing and or trading activities and as such the question of having any stock and maintenance of records in respect thereof and physical verification of inventory does not arise.
(iii) (a) As informed, the Company has not granted any loans, secured or unsecured, to Companies, firms or other parties covered in the register maintained under section 301 of the Companies Act, 1956 and hence the requirement of sub clauses (b) to (d) of
ANNEXURE REFERRED to in paragraph 3 of our report of even date
clause (iii)of the Companies (Auditor’s Report) Order, 2003 ( as amended) are not applicable.
(b) As informed, the Company has not taken any loans, secured or unsecured, from Companies, firms or other parties covered in the register maintained under section 301 of the Companies Act,1956 and hence the requirement of sub clauses (f) & (g) of Clause (iii) of the Companies (Auditor’s Report) Order, 2003 ( as amended) are not applicable.
(iv) The Company has not purchased any goods and fixed assets and also there is no sale of goods and services during the year and as such the question of having any internal control system with regard to purchase of inventory, fixed assets and sale of goods does not arise.
(v) There was no transaction which was required to be entered in the register maintained under section 301of the Companies Act. 1956.
Annual Report 2008-09 FINANCIAL STATEMENTS 113
ANNEXURE REFERRED to in paragraph 3 of our report of even date (Contd.)
Company does not attract any special statute applicable to chit fund and nidhi / mutual benefit fund/ societies.
(xiv) In respect of dealing in shares, securities, debentures and other investments, in our opinion and according to the information and explanations given to us, proper records have been maintained of the transactions and contracts and timely entries have been made therein. The shares, securities, debentures and other investments have been held by the Company in its own name.
(xv) As informed, the Company has not given any guarantee for loans taken by others from bank and financial institutions.
(xvi) The Company has not taken any term loan from any financial institutions or bank. The Company does not have any borrowing by way of debentures.
(xvii) We have been informed by the management that fundsraised on short term basis were not utilized for long term purpose.
(xviii) The Company has not made any preferential allotment ofshares to parties and Companies Covered in the register maintained under section 301 of the Companies Act.1956.
(xix) The Company has not issued any debentures during the year.
(xx) The Company has not raised any money through a public issue during the year.
(xxi) Based upon the audit procedures performed and information and explanations given to us by the management, we report that no fraud on or by the Company has been noticed or reported during the course of our audit.
For R. L. AGARWALLA & CO.
7, Rabindra Sarani Chartered Accountants
Kolkata – 700 001 R. L. AGARWALLA
Dated : 1st June, 2009 Proprietor
Membership No. 50516
(vi) The Company has not accepted any deposits from the public.
(vii) The internal audit was conducted by a service company and in our opinion the internal audit system was commensurate with the size of the Company and the nature of its business.
(viii) The Company is not required to maintain any cost records under section 209(1)(d)of the Companies Act, 1956.
(ix) The Company is regular in depositing undisputed statutory dues with the appropriate authorities, as applicable. As the Company has no employee and no manufacturing and or trading activities are carried on by the Company, the questions of payment of Provident Fund, Employees’ State Insurance, Sales Tax, Custom Duty, Excise Duty, Service tax, Cess etc, does not arise. According to the information and explanations given to us no undisputed amounts payable in respect of statutory dues were outstanding as on 31st March, 2009 for the period of more than six months from the date they become payable. There are no dues outstanding in respect of statutory dues on account of any dispute.
(x) The company has no accumulated loss at the end of financial year and it has not incurred any cash loss in the current and immediately preceding financial year.
(xi) In our opinion and according to the information and explanations given to us, the Company has not taken any loan from financial institutions, bank or debenture holders, as such, the question of any default does not arise.
(xii) The Company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and other securities hence maintenance of records in respect thereof does not arise.
(xiii) In our opinion, and according to the information and explanations given to us, the nature of activities of the
OSM Investment & Trading Company Limited 114
BALANCE SHEETas at 31st March, 2009
SCHEDULE 31st March, 2009Rs.
31st March, 2008Rs.
SOURCES OF FUNDS
Shareholders’ Fund
Share Capital 1 1,74,04,180 1,74,04,180
Reserves & Surplus 2 3,45,10,888 3,34,46,189
5,19,15,068 5,08,50,369
APPLICATION OF FUNDS
Fixed Assets
Land
As per last account 31,45,415 31,45,415
Investments 3 4,77,07,627 4,52,07,627
Current Assets, Loans & Advances
Current Assets
Cash & Bank Balances 4 20,026 53,327
Loans & Advances
Loan to The Oudh Sugar Mills Ltd., the
holding company (not bearing Interest) 10,50,000 24,50,000
10,70,026 25,03,327
Less : Current Liabilities & Provisions 5
Current Liabilities 8,000 6,000
8,000 6,000
Net Current Assets 10,62,026 24,97,327
5,19,15,068 5,08,50,369
Accounting Policies & Notes on Accounts 6
Schedules referred to above form an integral part of the Balance Sheet
In terms of our attached report of even date.
For R. L. AGARWALLA & CO.Chartered Accountants
7, Rabindra Sarani R. L. AGARWALLAKolkata – 700 001 Proprietor T.R. CHACHANDated : 1st June, 2009 Membership No. 50516 A.L. TULSIAN Directors
Annual Report 2008-09 FINANCIAL STATEMENTS 115
PROFIT & LOSS ACCOUNTfor the year ended 31st March, 2009
SCHEDULE 2008-2009Rs.
2007-2008Rs.
INCOME : Dividend from Long Term Investments 11,66,225 26,56,805
11,66,225 26,56,805 EXPENDITURE :
Rates & Taxes 8,800 8,950 Auditors' Remuneration
Audit Fees 8,000 10,000 For Certificates & Others 7,250 2,000 Directors' Fees 3,600 4,600 Miscellaneous Expenses 75,036 63,675 (including Service Charges Rs. 49,439;previous year Rs. 44,944)
1,02,686 89,225 Profit before Taxation 10,63,539 25,67,580 Less : Provision for Taxation - 286 Add : Excess Provision for Taxation in respect of an 10,63,539 25,67,294 earlier year written back - 1,240Add : Income-Tax refund received in respect of an 10,63,539 25,68,534 earlier year 1,160 - Profit after Taxation 10,64,699 25,68,534 Add : Balance brought forward from last year 1,15,87,129 95,33,595 Profit available for Appropriation 1,26,51,828 1,21,02,129 APPROPRIATIONS :
Transfer to Reserve Fund 2,13,000 5,15,000 Balance carried to Balance Sheet 1,24,38,828 1,15,87,129
1,26,51,828 1,21,02,129 Accounting Policies & Notes on Accounts 6In terms of our attached report of even date.
31st March, 2009
Rs.
31st March, 2008
Rs.
SCHEDULE - 1 : SHARE CAPITALAuthorised :
24,90,000 Equity Shares of Rs. 10 each 2,49,00,000 2,49,00,000 2,60,000 Preference Shares of Rs. 10 each 26,00,000 26,00,000
2,75,00,000 2,75,00,000 Issued :
17,40,420 Equity Shares of Rs. 10 each 1,74,04,200 1,74,04,200 1,74,04,200 1,74,04,180
Subscribed & Paid-up :17,40,418 Equity Shares of Rs. 10 each fully paid up in cash 1,74,04,180 1,74,04,180
1,74,04,180 1,74,04,180
Notes :
The entire Subscribed Equity Share Capital is held by The Oudh Sugar Mills Ltd., the holding company.
SCHEDULES to the Balance Sheet
For R. L. AGARWALLA & CO.Chartered Accountants
7, Rabindra Sarani R. L. AGARWALLAKolkata – 700 001 Proprietor T.R. CHACHANDated : 1st June, 2009 Membership No. 50516 A.L. TULSIAN Directors
OSM Investment & Trading Company Limited 116
31st March, 2009Rs.
31st March, 2008Rs.
SCHEDULE - 2 : RESERVES & SURPLUS :
Share Premium Account :
As per last Account 87,02,060 87,02,060
General Reserve :
As per last Account 50,00,000 50,00,000
Reserve Fund :
As per last Account 56,57,000 51,42,000
Transfer from Profit & Loss Account 2,13,000 5,15,000
58,70,000 56,57,000
Capital Redemption Reserve :
As per last Account 25,00,000 25,00,000
Surplus as per Profit & Loss Account 1,24,38,828 1,15,87,129
3,45,10,888 3,34,46,189
No. of SharesFace Value
Rs.31st March, 2009
Rs.31st March, 2008
Rs.
SCHEDULE - 3 : INVESTMENTS (At Cost)
Long Term Investments (Non-Trade) :
Quoted : (Fully Paid)
Equity Shares :
Upper Ganges Sugar & Industries Ltd 2,34,891 10 1,70,29,956 1,70,29,956
SIL Investments Ltd. 4,17,421 10 97,63,978 97,63,978
(Formerly Sutlej Industries Ltd.)
Sutlej Textiles & Industries Ltd. 4,25,880 10 1,40,06,908 1,40,06,908
Manbhawani Investment Ltd. 67,500 10 2,06,905 2,06,905
New India Retailing & Investment Ltd. 38,349 10 30,67,920 30,67,920
(Formerly New India Sugar Mills Ltd.)
4,40,75,667 4,40,75,667
Unquoted : (Fully Paid)
Equity Shares :
Modern DiaGen Services Ltd. 13,196 10 1,31,960 1,31,960
(Formerly Damanganga Processors Ltd.)
Preference Shares :
8% Non-Convertible Cumulative Redeemable
Preference Shares of New India Retailing &
Investment Ltd. 25,000 100 25,00,000 -
Unquoted : (Partly Paid)
Equity Shares :
Modern DiaGen Services Ltd. (Rs. 2/- Paid Up) 5,00,000 10 10,00,000 10,00,000
4,77,07,627 4,52,07,627
Aggregate Book Value of Investments :
Quoted 4,40,75,667 4,40,75,667
Unquoted 36,31,960 11,31,960
4,77,07,627 4,52,07,627
Market Value of Quoted Investments 4,19,27,362 9,27,94,733
SCHEDULES to the Balance Sheet
Annual Report 2008-09 FINANCIAL STATEMENTS 117
31st March, 2009Rs.
31st March, 2008Rs.
SCHEDULE - 4 : CASH & BANK BALANCES:
Cash in hand 1,106 1,162
With a Scheduled Bank on Current Account 18,920 52,165
20,026 53,327
SCHEDULE - 5 : CURRENT LIABILITIES & PROVISIONS :
Current Liabilities :
Sundry Creditors :
For Expenses 8,000 6,000
8,000 6,000
SCHEDULES to the Balance Sheet (Contd.)
1. Accounting Policies :
i) Fixed Assets are stated at cost.
ii) Long Term Investments are considered at cost on individual basis, unless there is permanent decline in value thereof, in which
case adequate provision is made against the diminution in the value of investments.
iii) Items of Income and Expenditure are recognised on accrual basis.
2. Contingent Liability not provided for in respect of uncalled capital on partly paid shares held as investments of Rs 40,00,000
(Previous year- Rs 40,00,000)
3. Diminution of Rs. 113.77 Lakhs in the value of certain quoted investments based on the last quoted price, has not been
provided, as the break-up value of the said shares supplemented by the market value as on 31st March, 2008 / 30th June, 2008, of
the quoted investments held by the investee Company, is much higher than the corresponding Book Value.
4 The Company has pledged 2,34,891 Equity Shares of Upper Ganges Sugar & Industries Ltd.,and 4,17,421 Equity Shares of Sutlej
Textiles & Industries Ltd. against outstanding loan of Rs.900 Lakhs granted by The Bank of Rajasthan Ltd. to The Oudh Sugar Mills
Ltd.., the Holding Company.
Signatories to Schedules - 1 to 6
SCHEDULE - 6 : ACCOUNTING POLICIES & NOTES ON ACCOUNTS :
For R. L. AGARWALLA & CO.Chartered Accountants
7, Rabindra Sarani R. L. AGARWALLAKolkata – 700 001 Proprietor T.R. CHACHANDated : 1st June, 2009 Membership No. 50516 A.L. TULSIAN Directors
OSM Investment & Trading Company Limited 118
BALANCE SHEET ABSTRACTand company’s General Business Profile
I. Registration Details
Registration No. U67120WB1986PLC041677 State Code 21
Balance Sheet Date 31.03.2009
II. Capital Raised during the year (Amount in Rs. thousands)
Public Issue Nil Rights Issue Nil
Bonus Issue Nil Private Placement Nil
III. Position of Mobilisation and Deployment of Funds (Amount in Rs. thousands)
Total Liabilities 51915 Total Assets 51915
Sources of Funds Application of Funds :
Paid-up Capital 17404 Net Fixed Assets 3145
Reserves & Surplus 34511 Investments 47708
Secured Loans Nil Net Current Assets 1062
Unsecured Loans Nil Miscellaneous Expenditure Nil
Accumulated Losses Nil
IV. Performance of Company (Amount in Rs. Thousands)
Turnover 1166 Total Expenditure 103
Profit before Tax 1063 Profit after Tax 1065
Earning per Share (Rs.) 0.61 Dividend Rate Nil
V. Generic Names of Principal Products / Services of the Company
(as per monetary terms)
Item Code No. (ITC Code)
Product DescriptionNot Applicable
T. R. CHACHAN Directors
A. L. TULSIAN
Annual Report 2008-09 FINANCIAL STATEMENTS 119
SCHEDULE to the Balance Sheet of a Non-Banking Financial Company(As required in terms of paragraph 9BB of Non-Banking Financial Companies Prudential Norms (Reserve Bank) Directions, 1998)
Rs. in Lakhs
PARTICULARS Amount
outstanding(As on
31.03.2009)
AmountOverdue
(As on 31.03.2009)
Liabilities Side : 1) Loans and Advances availed by
the NBFC’S inclusive of interestaccrued thereon but not paid:(a) Debentures :
Secured Nil NilUnsecured Nil Nil(Other than falling withinthe meaning of PublicDeposits)
(b) Deferred Credits Nil Nil(c) Term Loans Nil Nil(d) Inter-Corporate Loans and
BorrowingsNil Nil
(e) Commercial Paper Nil Nil(f) Other Loans (specify nature) Nil Nil
4) Break-up of Investments : Current Investments : 1. Quoted :
(i) Shares :(a) Equity Nil (b) Preference Nil
(ii) Debentures and Bonds Nil(iii) Units of Mutual Funds Nil(iv) Government Securities Nil(v) Others (please specify) Nil
2. Unquoted :(i) Shares :
(a) Equity Nil(b) Preference Nil
(ii) Debentures and Bonds Nil(iii) Units of Mutual Funds Nil(iv) Government Securities Nil(v) Others (please specify) Nil
Long Term Investments : 1. Quoted : Rs. in Lakhs
(i) Shares :(a) Equity 440.76(b) Preference Nil
(ii) Debentures and Bonds Nil(iii) Units of Mutual Funds Nil(iv) Government Securities Nil(v) Others (please specify) Nil
2. Unquoted :(i) Shares :
(a) Equity(b) Preference 11.32
(ii) Debentures and Bonds 25.00(iii) Units of Mutual Funds Nil(iv) Government Securities Nil(v) Others (please specify) Nil
5) Borrower group-wise classification of Assets financed as
in (2) and (3) above : Category Amount net of provisions
Secured Unsecured Total1. Related Parties
(a) Subsidiaries Nil Nil Nil(b) Companies
in the same groupNil 10.50 10.50
(c) Other related parties Nil Nil Nil2. Other than related parties Nil Nil Nil
Total Nil 10.50 10.50
Amount outstanding
Assets Side :
2) Break-up of Loans and Advancesincluding Bills receivables (other than those included in (3) below)
(a) Secrued Nil(b) Unsecured 10.50
3) Break-up of Leased Assets andStock on Hire and other assetscounting towards AFC activitiesi) Lease Assets including lease
rentals under sundry debtors : (a) Financial Lease Nil(b) Operating Lease Nil
ii) Stock on hire including hirecharges under sundry debtors : (a)
(b)
Assets on hire
Repossessed AssctsNil
Niliii) Other Loans counting towards
AFC activities :
(a) Loans where assets have been repossessed Nil
(b) Loans other than (a) above Nil
6) Investor group-wise classification of all Investments (current and long term) in shares and securities (both quoted and unquoted) : Category Market Value/
Break-up orFair value or
NAV
Book Value(Net of
Provisions)
1. Related Parties (a) Subsidiaries Nil Nil(b) Companies in the same
group Nil Nil
(c) Other related parties Nil Nil2. Other than related parties 422.33 477.08
Total 422.33 477.08
7) Other InformationParticulars Amounti) Gross Non-Performing Assets
(a) Related parties Nil(b) Other than related parties Nil
ii) Net Non-Performing Assets (a) Related parties Nil(b) Other than related parties Nil
iii) Assets acquired in satisfaction of debt Nil
T. R. CHACHAN Directors
A. L. TULSIAN
OSM Investment & Trading Company Limited 120
To
The Shareholders,
Hargaon Investment & Trading Co. Ltd.
Your Directors have pleasure in presenting their Report and
the audited Accounts of the Company for the year ended
31st March, 2009.
2. Financial Results : Rs.
The Profit & Loss Account shows a profit of 22,51,416
To which is added balance brought forward
from the previous year4,75,27,190
Making a total of 4,97,78,606
Out of this provision has been made for
Reserve Fund4,51,000
Balance to be carried forward 4,93,27,606
3. Dividend :
Your Directors have not recommended any dividend.
4. Directors :
Mr. Sanjay Mukherjee resigned from the Directorship of the
Company with effect from 23rd March, 2009.
Mr. C.S. Nopany retires from the Board by rotation and is
eligible for re-appointment.
5. Auditors :
The Auditors, Messrs R. L. Agarwalla & Co., Chartered
Accountants, retire and are eligible for re-appointment.
6. Conservation of Energy, Technology Absorption, Foreign
Exchange Earnings and Outgo :
As the Company has no manufacturing activity, it is
not required to furnish any information with regard to
conservation of energy. There is no information to furnish
with regard to technology absorption. During the year, no
foreign exchange was earned or used by the Company.
7. Particulars of Employees :
The provisions of Section 217 (2A) of the Companies Act,
1956 are not applicable to the Company as there is no
employee.
8. Directors’ Responsibility Statement :
Your Directors confirm that -
i) in preparation of the annual accounts, the applicable
accounting standards have been followed along with
proper explanation relating to material departures;
ii) they have selected such accounting policies and applied
them consistently and made judgements 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 of the
Company for that year;
iii) they have taken proper and sufficient care for the
maintenance of adequate accounting records in
accordance with the provisions of the Companies
Act, 1956 for safeguarding the assets of the Company
and for preventing and detecting fraud and other
irregularities;
iv) they have prepared the annual accounts on a going
concern basis.
9. Auditors Report :
The notes to the Accounts referred to in the Auditors Report
are self –explanatory.
10. Compliance Certificate :
A copy of the Compliance Certificate from Shri S.K. Jain,
Practicing Company Secretaries, as required under Section
383A of the Companies Act, 1956 is attached and forms a
part of this Report.
11. Subsidiary Company :
The audited accounts of Hargaon Properties Ltd., a subsidiary
of the Company, for the year ended 31st March, 2009 are
attached as required under Section 212 of the Companies
Act, 1956.
9/1, R.N. Mukherjee Road,
Kolkata - 700 001 S.K. JHUNJHUNWALADirectors
Dated : 1st June, 2009 K.C. GUPTA
Statement Pursuant to Section 212 of the Companies Act, 1956
As on 31st March, 2009 55.56% of the subscribed share capital of
Hargaon Properties Ltd. was held by the Company.
The net amount of the Profit / (Loss) of the subsidiary company
for the last as well as the previous year, which concerns the
members of the Company but have not been dealt with in or
for the purposes of the accounts of the Company amounts to
(Rs. 12,863) and Rs. 1,44,050.
9/1, R.N. Mukherjee Road,
Kolkata - 700 001 S.K. JHUNJHUNWALADirectors
Dated : 1st June, 2009 K.C. GUPTA
DIRECTORS’ REPORT
Annual Report 2008-09 FINANCIAL STATEMENTS 121
To,The ShareholdersHargaon Investment & Trading Co. Ltd.
I have examined the registers, records, books and papers of Hargaon Investment & Trading Company Limited, CIN U67120WB1986PLC041679 (the Company), as required to be maintained under the Companies Act, 1956 and the rules made thereunder and also the provisions contained in the Memorandum and Articles of Association of the Company for the financial year ended on 31.3.2009. In my opinion and to the best of my information and according to the examinations carried out by me and explanations furnished to me by the Company, its officers and agents, I certify that in respect of the aforesaid financial year :
1) The Company has kept and maintained all registers, as stated in Annexure `A’ to the Certificate, as per the provisions of the Act and the rules made thereunder, and all entries therein have been duly recorded.
2) The Company has duly filed the forms and returns, as stated in Annexure `B’ to this certificate, with the Registrar of Companies, Regional Director, Central Government, Company Law Board and other authorities.
3) The Company being a Public Limited Company, comments on clause 3 is not required.
4) The Board of Directors duly met 6 (Six) times on 16.04.2008, 02.06.2008, 24.09.2008, 03.10.2008, 17.12.2008 and 23.03.2009 in respect of which meetings, proper notices were given and the proceedings were properly recorded and signed in the Minutes Book maintained for the purpose.There were no circular resolutions passed during the year.
5) The Company has not closed its Register of Members or Debenture holders during the financial year.
6) The Annual General Meeting for the financial year ended 31st March, 2008 was held on 28.07.2008 after giving due notice to the Members of the Company and the resolutions passed thereat were duly recorded in Minutes Book maintained for the purpose.
7) No Extra-ordinary general meeting was held during the financial year.
8) The Company has not advanced during the year any loans to its directors or persons or firms or companies referred to under Section 295 of the Act.
9) The Company has not entered into any contract falling within the purview of Section 297 of the Act during the year under review.
10) The Company was not required to make any entry in the register maintained under Section 301 of the Act during the year.
11) As there was no instances falling within the purview of provisions of Section 314 of the Act, the company was not required to obtain any approvals from directors, members or the Central Government.
12) The Company has not issued any duplicate share certificates during the financial year.
13) The Company has:
i) made no allotment/transfer/transmission of securities during the financial year;
ii) not deposited any amount in a separate Bank Account as no dividend was declared during the Financial year;
iii) not posted warrants to any member of the Company as no dividend was declared during the Financial year;
iv) no case requiring the Company to transfer in unpaid dividend account, Application money due for refund, matured deposits, matured debentures and the interest accrued thereon which has remained unclaimed or unpaid for a period of seven years to Investor Education & Protection Fund;
v) Generally complied with the requirements of section 217 of the Act.
14) The Board of Directors of the Company is duly constituted. There was no appointment of additional director, alternate directors and directors to fill casual vacancy during the financial year.
15) The Company has not appointed any Managing Director/Whole Time Director / Manager during the financial year.
16) The Company has not appointed any sole-selling agents during the financial year.
17) The Company was not required to obtain any approvals of the Central Government, Company Law Board, Regional Director, Registrar and/or such authorities as prescribed under the various provisions of the Act during the financial year.
18) The Directors have disclosed their interest in other firms / companies to the Board of Directors pursuant to the provisions of the Act and the rules made thereunder.
19) The Company has not issued any shares, debentures or other securities during the financial year.
20) The Company has not bought back any shares during the financial year.
21) There was no redemption of preference shares or debentures during the financial year.
COMPLIANCE CERTIFICATE
Hargaon Investment & Trading Company Limited 122
22) There were no transactions necessitating the Company to
keep in abeyance the rights to dividend, rights shares and
bonus shares pending registration of transfer of shares.
23) The Company has not invited / accepted any deposits
including any unsecured loans falling within the purview of
Section 58A during the financial year.
24) The Company has not made any borrowings during the
Financial year ended on 31-03-2009.
25) The Company being a Licenced Non-Banking Finance
company the provisions of Section 372A are not
applicable.
26) The Company has not altered the provisions of the
Memorandum with respect to situation of the Company’s
registered office from one State to another during the year
under scrutiny.
27) The Company has not altered the provisions of the
Memorandum with respect to the objects of the Company
during the year under scrutiny.
28) The Company has not altered the provisions of the Memorandum with respect to name of the company during the year under scrutiny.
29) The Company has not altered the provisions of the Memorandum with respect to share capital of the Company during the year under scrutiny.
30) The Company has not altered its Articles of Association during the financial year under scrutiny.
31) There was / were no prosecution initiated against or show cause notice received by the Company and no fines or penalties or any other punishment imposed on the Company during the financial year, for offences under the Act.
32) The Company has not received any money as security from its employees during the financial year.
33) The Company has not established any fund as required under Section 418 of the Act and hence deduction and payment of Provident Fund during the financial year does not arise.
COMPLIANCE CERTIFICATE (Contd.)
Annexure `A’
Statutory Registers as maintained by the Company
1. Register of Members & Share Ledger U/S 150 & 1512. Register of Directors, Managing Directors etc. U/S 3033. Register of Director’s Shareholding U/S 3074. Register of Share Transfers U/S 1085. Register of Charges & Records U/S 143 & 1286. Register of Investments U/S 49(7)7. Copies of Returns filed with the Registrar of Companies U/S 1638. Register of Contracts & Directors interest U/S 299 & 3019. Register of Contracts in which Directors are interested U/S 301(3)10. Minute books for proceedings of Board Meetings U/S 19311. Minute books for proceedings of General meetings U/S 19312. Register of Directors attendance at the meeting of the Board Under Regulation 71 of Table A to Schedule I of the Act.13. Register of Fixed Assets As required under the Manufacturing and other Companies
(Auditor’s Report) Order, 1988.14. Register of Loans & Investments made U/S 372 (A)15. Books of Accounts Under Section 209
Sl. No. Form No. Filed Service Request Number
1. Form No. 20B U/S 159 P 21718085
2. Form No. 23AC & 23ACA U/S 220 P 20328100
3. Form No. 32 U/S 303(2) A 58939711
Annexure `B’
Forms and Returns as filed by the Company with Registrar of Companies, Regional Director, Central Government or other authorities
during the Financial year ended 31.3.2009.
Signature : For S. K. JAIN
FE-257, Sector III, Company Secretaries
Salt Lake City, Kolkata-700 106 Name of the Company Secretary : S. K. JAIN
Dated : 1st June, 2009 C. P. No. : 4077
Annual Report 2008-09 FINANCIAL STATEMENTS 123
AUDITORS’ REPORT To The MembersHargaon Investment & Trading Co. Ltd.
1. We have audited the attached Balance Sheet of Hargaon Investment & Trading Company Limited as at 31st March, 2009 and also the Profit & Loss Account for the year ended on that date annexed thereto. These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements based on our audit.
2. We conducted our audit in accordance with the auditing standards generally accepted in India. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatements. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by the management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.
3. As required by the Companies (Auditor’s Report) Orders, 2003 (as amended), issued by the Central Government of India in terms of sub-section(4A) of section 227 of the Companies Act,1956, we enclose in the annexure, a statement on the matters specified in paragraphs 4 & 5 of the said order.
4. Further we reported that:-
i) We have obtained all the information and explanations, which to the best of our knowledge and belief were necessary for the purpose of our audit;
ii) In our opinion, proper books of account as required by the Laws have been kept by the Company, so far as appears from our examination of those books;
iii) The Balance Sheet and the Profit & Loss Account dealt with by this report, are in agreement with the books of account as submitted to us;
iv) In our opinion, the Balance Sheet and Profit & Loss Account dealt with by this report comply with the accounting standards referred to in sub-section (3C) of section 211of the Companies Act, 1956;
v) On the basis of written representations received from the directors, as on 31st March, 2009 and taken on record by the Board of Directors, we report that none of the Directors is disqualified as on 31st March, 2009 from being appointed as a director in term of clause (g) of sub-section (1) of section 274 of the Companies Act, 1956.
vi) In our opinion and to the best of our information and according to the explanations given to us, the said accounts subject to Note No. 3 on Schedule 6, regarding non-provision for diminution in the market value of quoted investments amounting to Rs. 296.13 lakhs, as in the opinion of the management, the break-up value of those investments are higher than the corresponding book value, whose impact on the Company’s profit/reserves is not presently ascertainable and read together with other notes thereon and attached thereto give the information required by the Companies Act, 1956 in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:
a) in the case of the Balance Sheet, of the state of affairs of the Company as at 31st March, 2009; and
b) in the case of the Profit & Loss Account, of the profit for the year ended on that date.
For R.L. AGARWALLA & CO.
Chartered Accountants
7, Rabindra Sarani (R.L.AGARWALLA)
Kolkata – 700 001 Proprietor
Dated : 1st June, 2009 Membership No. 50516
(i) The Company has maintained proper records of fixed assets showing full particulars, including quantitative details and situation thereof. Fixed Assets have been physically verified by the management during the year and no material discrepancies were noticed on such verification. There was no substantial disposal of fixed assets during the year.
(ii) The Company has no manufacturing and or trading activities and as such the question of having any stock and maintenance of records in respect thereof and physical verification of inventory does not arise.
(iii) (a) As informed, the Company has not granted any loans, secured or unsecured, to Companies, firms or other parties covered in the register maintained under section 301 of the Companies Act, 1956 and hence the requirement of sub clauses (b) to (d) of
ANNEXURE REFERRED to in paragraph 3 of our report of even date
clause (iii) of the Companies (Auditor’s Report) Order, 2003 (as amended) are not applicable.
(b) As informed, the Company has not taken any loans, secured or unsecured, from Companies, firms or other parties covered in the register maintained under section 301 of the Companies Act, 1956 and hence the requirement of sub clauses (f) & (g) of Clause (iii) of the Companies (Auditor’s Report) Order, 2003 (as amended) are not applicable.
(iv) The Company has not purchased any goods and fixed assets and also there is no sale of goods and services during the year and as such the question of having any internal control system with regard to purchase of inventory, fixed assets and sale of goods does not arise.
(v) There was no transaction which was required to be entered in the register maintained under section 301 of the Companies Act, 1956.
Hargaon Investment & Trading Company Limited 124
(vi) The Company has not accepted any deposits from the public.
(vii) The internal audit was conducted by a service company and in our opinion the internal audit system was commensurate with the size of the Company and the nature of its business.
(viii) The Company is not required to maintain any cost records under section 209(1)(d)of the Companies Act, 1956.
(ix) The Company is regular in depositing undisputed statutory dues with the appropriate authorities, as applicable. As the Company has no employee and no manufacturing and or trading activities are carried on by the Company, the question of payment of Provident Fund, Employees’ State Insurance, Sales Tax, Custom Duty, Excise Duty, Service tax, Cess etc, does not arise. According to the information and explanations given to us no undisputed amounts payable in respect of statutory dues were outstanding as on 31st March, 2009 for the period of more than six months from the date they become payable. There are no dues outstanding in respect of statutory dues on account of any dispute.
(x) The company has no accumulated loss at the end of financial year and it has not incurred any cash loss in the current and immediately preceding financial year.
(xi) In our opinion and according to the information and explanations given to us, the Company has not taken any loan from financial institutions, bank or debenture holders, as such, the question of any default does not arise.
(xii) The Company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and other securities hence maintenance of records in respect thereof does not arise.
(xiii) In our opinion, and according to the information and explanations given to us, the nature of activities of the Company does not attract any special statute applicable to chit fund and nidhi / mutual benefit fund/ societies.
(xiv) In respect of dealing of shares, securities, debentures and other investments, in our opinion and according to the information and explanations given to us, proper records have been maintained of the transactions and contracts and timely entries have been made therein. The shares, securities, debentures and other investments have been held by the Company in its own name.
(xv) As informed, the Company has not given any guarantee for loans taken by others from bank and financial institutions.
(xvi) The Company has not taken any term loan from any financial institutions or bank. The Company does not have any borrowing by way of debentures.
(xvii) We have been informed by the management that funds raised on short term basis were not utilized for long term purpose.
(xviii) The Company has not made any preferential allotment of shares to parties and Companies covered in the register maintained under section 301 of the Companies Act.1956.
(xix) The Company has not issued any debentures during the year.
(xx) The Company has not raised any money through a public issue during the year.
(xxi) Based upon the audit procedures performed and information and explanations given to us by the management, we report that no fraud on or by the Company has been noticed or reported during the course of our audit.
For R.L. AGARWALLA & CO.
Chartered Accountants
7, Rabindra Sarani (R.L.AGARWALLA)
Kolkata – 700 001 Proprietor
Dated : 1st June, 2009 Membership No. 50516
Annual Report 2008-09 FINANCIAL STATEMENTS 125
BALANCE SHEETas at 31st March, 2009
SCHEDULE 31st March, 2009
Rs.
31st March, 2008
Rs.
SOURCES OF FUNDS
Shareholders’ Fund
Share Capital 1 3,04,57,270 3,04,57,270
Reserves & Surplus 2 10,90,47,816 10,67,96,400
13,95,05,086 13,72,53,670
APPLICATION OF FUNDS
Fixed Assets
Land
As per last account 29,35,653 29,35,653
Investments 3 12,51,91,208 12,01,91,208
Current Assets, Loans & Advances
Current Assets
Cash & Bank Balances 4 36,225 32,809
Loans & Advances
Loans
To The Oudh Sugar Mills Ltd.,
the holding Company (not bearing interest) 1,13,00,000 1,40,50,000
Advances recoverable in cash or in kind or for value to be
received or pending adjustments 50,000 50,000
1,13,86,225 1,41,32,809
Less : Current Liabilities & Provisions 5
Current Liabilities 8,000 6,000
Net Current Assets 1,13,78,225 1,41,26,809
13,95,05,086 13,72,53,670
Accounting Policies & Notes on Accounts 6
Schedules referred to above form an integral part of the Balance Sheet
In terms of our attached report of even date.
For R. L. AGARWALLA & CO.
Chartered Accountants
7, Rabindra Sarani (R. L. AGARWALLA)
Kolkata – 700 001 Proprietor S.K. JHUNJHUNWALADirectors
Dated : 1st June, 2009 Membership No. 50516 K.C. GUPTA
Hargaon Investment & Trading Company Limited 126
PROFIT & LOSS ACCOUNTfor the year ended 31st March, 2009
SCHEDULE 2008-2009Rs.
2007-2008Rs.
INCOME
Dividend from Long Term Investments 23,49,086 63,42,344
23,49,086 63,42,344
EXPENDITURE
Rates & Taxes 7,300 7,300
Auditors' Remuneration
Audit Fees 8,000 10,000
For Certificates 7,250 2,000
Directors' Fees 3,800 4,400
Miscellaneous Expenses
(including Service Charges Rs. 49,439 previous year Rs. 44,944) 71,320 72,540
97,670 96,240
Profit before Taxation 22,51,416 62,46,104
Less : Provision for Taxation - 5,125
Profit after Taxation 22,51,416 62,40,979
Add : Balance brought forward from last year 4,75,27,190 4,25,36,211
Profit available for Appropriation 4,97,78,606 4,87,77,190
APPROPRIATIONS :
Transfer to Reserve Fund 4,51,000 12,50,000
Balance carried to Balance Sheet 4,93,27,606 4,75,27,190
4,97,78,606 4,87,77,190
Accounting Policies & Notes on Accounts 6
Schedules referred to above form an integral part of the Profit and Loss Account.
In terms of our attached report of even date.
For R. L. AGARWALLA & CO.
Chartered Accountants
7, Rabindra Sarani (R. L. AGARWALLA)
Kolkata – 700 001 Proprietor S.K. JHUNJHUNWALADirectors
Dated : 1st June, 2009 Membership No. 50516 K.C. GUPTA
Annual Report 2008-09 FINANCIAL STATEMENTS 127
SCHEDULES to the Balance Sheet
31st March, 2009Rs.
31st March, 2008Rs.
SCHEDULE - 1 : SHARE CAPITAL
Authorised
49,90,000 Equity Shares of Rs. 10 each 4,99,00,000 4,99,00,000
10,000 Preference Shares of Rs. 10 each 1,00,000 1,00,000
5,00,00,000 5,00,00,000
Issued
30,45,733 Equity Shares of Rs. 10 each 3,04,57,330 3,04,57,330
Subscribed & Paid-up
30,45,727 Equity Shares of Rs. 10 each fully paid up in cash 3,04,57,270 3,04,57,270
(The entire Subscribed Capital is held by The Oudh Sugar Mills Ltd., the holding company)
SCHEDULE - 2 : RESERVES & SURPLUS
Share Premium Account
As per last Account 3,04,57,210 3,04,57,210
Reserve Fund
As per last Account 1,63,62,000 1,51,12,000
Transfer from Profit & Loss Account 4,51,000 12,50,000
1,68,13,000 1,63,62,000
General Reserve
As per last Account 1,24,50,000 1,24,50,000
Surplus as per Profit & Loss Account 4,93,27,606 4,75,27,190
10,90,47,816 10,67,96,400
No. of Shares Face ValueRs.
31st March, 2009Rs.
31st March, 2008Rs
SCHEDULE - 3 : INVESTMENTS (At Cost)
Long Term Investments (Non-Trade)
Quoted (Fully Paid)
Equity Shares
Upper Ganges Sugar & Industries Ltd 6,57,966 10 4,88,31,540 4,88,31,540
New India Retailing & Investment Ltd 1,34,448 10 1,06,72,988 1,06,72,988
(Formerly New India Sugar Mills Ltd.)
SIL Investments Ltd. 11,40,931 10 2,60,25,111 2,60,25,111
(Formerly Sutlej Industries Ltd.)
Sutlej Textiles & Industries Ltd 11,40,931 10 3,10,22,481 3,10,22,481
11,65,52,120 11,65,52,120
Unquoted (Fully Paid)
Equity Shares
India Educational and Research Institutions Pvt. Ltd. 4,900 10 49,000 49,000
Preference Shares 8% Non-Convertible Cumulative Redeemable
PreferenceShares of New India Retailing & Investment Ltd. 50,000 100 50,00,000 -
Unquoted (Partly Paid)
Equity Shares
Modern DiaGen Services Ltd. (Rs. 2 Paid Up) 545,044 10 10,90,088 10,90,088
Hargaon Investment & Trading Company Limited 128
SCHEDULE - 4 : CASH & BANK BALANCES
Cash in hand 1,134 746
With a Scheduled Bank on Current Account 35,091 32,063
36,225 32,809
SCHEDULE - 5 : CURRENT LIABILITIES & PROVISIONS
Current Liabilities
Sundry Creditors
For Expenses 8,000 6,000
8,000 6,000
SCHEDULE - 6 : ACCOUNTING POLICIES & NOTES ON ACCOUNTS
Aggregate Book Value of Investments
Quoted 11,65,52,120 11,65,52,120
Unquoted 86,39,088 36,39,088
12,51,91,208 12,01,91,208
Market Value of Quoted Investments 11,48,90,864 25,31,61,038
No. of Shares Face ValueRs.
31st March, 2009Rs.
31st March, 2008Rs.
SCHEDULE - 3 : INVESTMENTS (At Cost) (Contd.)
Shares in Subsidiary Company
Unquoted (Fully Paid)
Equity Shares
Hargaon Properties Ltd. 2,50,000 10 25,00,000 25,00,000
12,51,91,208 12,01,91,208
SCHEDULES to the Balance Sheet (Contd.)
1. Accounting Policies
i) Fixed Assets are stated at cost.
ii) Long Term Investments are considered at cost on individual basis, unless there is permanent decline in value thereof, in which case adequate provision is made against the diminution in the value of investments.
iii) Items of Income and Expenditure are recognised on accrual basis.
2. Contingent Liability not provided for in respect of uncalled capital on partly paid shares held as investments of Rs. 43,60,352 (Previous Year - Rs. 43,60,352)
3. Diminution of Rs. 296.13 Lakhs in the Value of certain quoted investments based on the last quoted price, has not been provided, as the break-up value of the said shares supplemented by the market value as on 31st March, 2008 / 30th June, 2008, of the quoted investments held by the investee Company, is much higher than the corresponding Book Value.
4. The Company has given an undertaking to Punjab National Bank not to transfer, assign, dispose of, pledge, charge or create any lien or in any way encumber its shareholding, present or future in Sutlej Textiles & Industries Ltd without their approval in writing till the financial assistance provided by them to the said company remains unpaid.
5. The Company has pledged 6,57,966 Equity Shares of Upper Ganges Sugar & Industries Ltd. and 11,40,931 Equity Shares of Sutlej Textiles & Industries Ltd. against outstanding loan of Rs. 900 lakhs granted by ‘The Bank of Rajasthan Ltd. to The Oudh Sugar Mills Ltd., the holding Company.
Signatories to Schedules - 1 to 6
For R. L. AGARWALLA & CO.
Chartered Accountants
7, Rabindra Sarani (R. L. AGARWALLA)
Kolkata – 700 001 Proprietor S.K. JHUNJHUNWALADirectors
Dated : 1st June, 2009 Membership No. 50516 K.C. GUPTA
Annual Report 2008-09 FINANCIAL STATEMENTS 129
I. Registration Details
Registration No. U67120WB1986PLC041679 State Code 21
Balance Sheet Date 31.03.2009
II. Capital Raised during the year (Amount in Rs. Thousands)
Public Issue Nil Rights Issue Nil
Bonus Issue Nil Private Placement Nil
III. Position of Mobilisation and Deployment of Funds (Amount in Rs. Thousands)
Total Liabilities 1,39,505 Total Assets 1,39,505
Sources of Funds Application of Funds
Paid-up Capital 30,457 Net Fixed Assets 2,936
Reserves & Surplus 1,09,048 Investments 1,25,191
Secured Loans Nil Net Current Assets 11,378
Unsecured Loans Nil Miscellaneous Expenditure Nil
Accumulated Losses Nil
IV. Performance of Company (Amount in Rs. Thousands)
Turnover 2,349 Total Expenditure 98
Profit before Tax 2,251 Profit after Tax 2,251
Earning per Share (Rs.) 0.74 Dividend Rate Nil
V. Generic Names of Principal Products / Services of the Company
(as per monetary terms)
Item Code No. (ITC Code)
Product DescriptionNot Applicable
S.K. JHUNJHUNWALADirectors
K.C. GUPTA
BALANCE SHEET ABSTRACTand Company’s General Business Profile
Hargaon Investment & Trading Company Limited 130
SCHEDULES to the Balance Sheet of a Non-Banking Financial Company (As required in terms of paragraph 9BB of Non-Banking Financial Companies Prudential Norms (Reserve Bank) Directions, 1998)
Rs. in LakhsPARTICULARS Amount
outstanding(As on
31.03.2009)
Amountoverdue
(As on 31.03.2009)
Liabilities Side : 1) Loans and Advances availed by
the NBFC’S inclusive of interestaccrued thereon but not paid:(a) Debentures :
Secured Nil NilUnsecured Nil Nil(Other than falling within themeaning of Public Deposits)
(b) Deferred Credits Nil Nil(c) Term Loans Nil Nil(d) Inter-Corporate Loans and
BorrowingsNil Nil
(e) Commercial Paper Nil Nil(f) Other Loans (specify nature) Nil Nil
4) Break-up of Investments : Current Investments : 1. Quoted :
(i) Shares :(a) Equity Nil (b) Preference Nil
(ii) Debentures and Bonds Nil(iii) Units of Mutual Funds Nil(iv) Government Securities Nil(v) Others (please specify) Nil
2. Unquoted :(i) Shares :
(a) Equity Nil(b) Preference Nil
(ii) Debentures and Bonds Nil(iii) Units of Mutual Funds Nil(iv) Government Securities Nil(v) Others (please specify) Nil
Long Term Investments : 1. Quoted :
(i) Shares :(a) Equity 1165.52(b) Preference Nil
(ii) Debentures and Bonds Nil(iii) Units of Mutual Funds Nil(iv) Government Securities Nil(v) Others (please specify) Nil
2. Unquoted :(i) Shares :
(a) Equity 36.39(b) Preference 50.00
(ii) Debentures and Bonds Nil(iii) Units of Mutual Funds Nil(iv) Government Securities Nil(v) Others (please specify) Nil
5) Borrower group-wise classification of Assets financed as
in (2) and (3) above :
Rs. in LakhsCategory Amount net of provisions
Secured Unsecured Total1. Related Parties
(a) Subsidiaries Nil Nil Nil(b) Companies
in the same groupNil 113.00 113.00
(c) Other related parties Nil Nil Nil2. Other than related parties Nil 0.50 0.50
Total Nil 113.50 113.50
Amount
outstandingAssets Side : 2) Break-up of Loans and Advances
including Bills receivables (other than those included in (3) below)
(a) Secrued Nil(b) Unsecured 113.50
3) Break-up of Leased Assets and Stock on Hire and other assets counting towards AFC activities i) Lease Assets including lease
rentals under sundry debtors : (a) Financial Lease Nil(b) Operating Lease Nil
ii) Stock on hire including hire charges under sundry debtors : (a) Assets on Hire Nil(b) Repossessed Assets Nil
iii) Other Loans counting towards AFC activities : (a) Loans where assets have been
repossessed Nil
(b) Loans other than (a) above Nil
6) Investor group-wise classification of all Investments (current and long term) in shares and securities (both quoted and unquoted) :Category Market Value/
Break-up orFair value or
NAV
Book Value(Net of
Provisions)
1. Related Parties (a) Subsidiaries 26.37 25.00(b) Companies in the same
group Nil Nil
(c) Other related parties Nil Nil2. Other than related parties 1,201.85 1,226.91
Total 1,228.22 1,251.91
7) Other Information :Particulars Amounti) Gross Non-Performing Assets
(a) Related parties Nil(b) Other than related parties Nil
ii) Net Non-Performing Assets (a) Related parties Nil(b) Other than related parties Nil
iii) Assets acquired in satisfaction of debt Nil
S.K. JHUNJHUNWALADirectors
K.C. GUPTA
Annual Report 2008-09 FINANCIAL STATEMENTS 131
DIRECTORS’ REPORTTo
The Shareholders,
Hargaon Properties Ltd.
Your Directors have pleasure in presenting their Report and
the audited Accounts of the Company for the year ended
31st March, 2009.
2. Financial Results :
The Profit & Loss Account for the year under review after
writing off preliminary expenses of Rs. 13,115 shows a loss
of Rs. 23,152 which has been deducted from the credit
balance of Rs. 2,59,269 brought forward from the previous
year leaving a credit balance of Rs. 2,36,117 which is to be
carried forward.
3. Dividend :
Your Directors have not recommended any dividend.
4. Directors :
Shri Sanjay Mukherjee resigned from the Directorship of
the Company with effect from 1st April, 2009.
Shri U.S. Beria retires from the Board by rotation and being
eligible offers himself for re-appointment.
Shri Sunil Lohia, who was appointed as an additional
Director on 1st April , 2009 will hold office upto the date of
the ensuing Annual General Meeting.
The Company received a notice under Section 257 of the
Companies Act, 1956 proposing Shri Lohia ’s appointment as
a Director of the Company. The resolution for appointment
of Shri Sunil Lohia as a Director of the Company shall be
placed at the ensuing Annual General Meeting for the
approval of the members.
5. Auditors :
The Auditors, Messrs S.N. Roy & Co., Chartered Accountants,
retire and are eligible for re-appointment.
6. Conservation of Energy, Technology Absorption, Foreign
Exchange Earnings and Outgo :
As the Company has no manufacturing activity, it is
not required to furnish any information with regard to
conservation of energy. There is no information to furnish
with regard to technology absorption. During the year, no
foreign exchange was earned or used by the Company.
7. Particulars of Employees :
The provisions of Section 217 (2A) of the Companies Act,
1956 are not applicable to the Company as there is no
employee.
8. Directors’ Responsibility Statement :
Your Directors confirm that -
i) in preparation of the annual accounts, the applicable
accounting standards have been followed along with
proper explanation relating to material departures;
ii) they have selected such accounting policies and
applied them consistently and made judgements 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
loss of the Company for that year ;
iii) they have taken proper and sufficient care for the
maintenance of adequate accounting records in
accordance with the provisions of the Companies
Act, 1956 for safeguarding the assets of the Company
and for preventing and detecting fraud and other
irregularities;
iv) they have prepared the annual accounts on a going
concern basis.
9. Compliance Certificate :
A copy of the Compliance Certificate from Messrs D. Raut &
Associates, Company Secretaries, as required under Section
383A of the Companies Act, 1956 is attached and forms a
part of this Report.
9/1, R.N. Mukherjee Road,
Kolkata - 700 001 U.S. BERIA
Dated: 20th May, 2009 K. C. GUPTADirectors
Hargaon Properties Limited 132
COMPLIANCE CERTIFICATETo,The Members,Hargaon Properties Ltd.
We have examined the registers, records, books and papers of Hargaon Properties Limited (the Company) as required to be maintained under the Companies Act, 1956, (the Act) and the rules made thereunder and also the provisions contained in the Memorandum and Articles of Association of the Company for the financial year ended on 31st March, 2009. In our opinion and to the best of our information and according to the examinations carried out by us and explanations furnished to us by the Company, its officers and agents, we certify that in respect of the period under scrutiny :
1. The Company has kept and maintained all registers as stated in Annexure ‘A’ to this certificate, as per the provisions of the Act and the rules made thereunder and all entries therein have been duly recorded.
2. The Company has duly filed the forms and returns as stated in Annexure ‘B’ to this certificate, with the Registrar of Companies within the time prescribed under the Act and the rules made thereunder.
3. The Company, being a Public Limited Company, clause 3 is not applicable.
4. The Board of Directors duly met Four (4) times respectively on 28th May, 2008, 27th August, 2008, 26th November, 2008 and 18th February, 2009 in respect of which meetings proper notices were given and the proceedings were properly recorded and signed in the Minutes Book maintained for the purpose.
5. The Company was not required to close its Register of Members during the financial year, since it is not listed with any stock exchange.
6. The Annual General Meeting for the financial year ended on 31st March, 2008 was held on 11th July, 2008 after giving due notices to the members of the Company and the resolutions passed thereat were duly recorded in Minutes Book maintained for the purpose.
7. No Extra Ordinary General Meeting was held duringthe year.
8. The Company has not advanced any loans to its Directors or persons or firms or Companies referred to under Section 295 of the Act.
9. The Company has not entered into any contracts falling within the purview of Section 297 of the Act.
10. The Company has made necessary entries in the register maintained under Section 301 of the Act.
11. As there was no instance falling within the purview of Section 314 of the Act, the Company was not required to obtain any approvals from the Board of Directors, members, or Central Government.
12. The Company has not issued any duplicate Share certificates during the financial year.
13. The Company has :
a. not made any transfer / transmission or allotment of shares during the financial year.
b. not deposited any amount in a separate Bank Account as no dividend was declared during thefinancial year.
c. was not required to post warrants to members of the Company as no dividend was declared during the financial year.
d. no amount in unpaid dividend account, application money due for refund, matured deposits, matured debentures and the interest accrued thereon and as such it was not required to transfer any amount to Investor Education And Protection Fund.
e. has duly complied with the requirements of Section 217 of the Act.
14. The Board of Directors of the Company is duly constituted. There is no appointment of any Director / Additional Director or Director to fill casual vacancy during the financial year.
15. The Company has not appointed any Managing Director / Whole time Director / Manager during the financial year, as there was no need to do so.
16. The Company has not appointed any sole-selling agents during the financial year.
17. The Company was not required to obtain any approvals of the Central Government, Company Law Board, Regional Director, Registrar of Companies or such other authorities as may be prescribed under the various provisions of the Act during the financial year.
18. The Directors have disclosed their interest in otherfirms / Companies to the Board of Directors pursuant to the provisions of the Act and the rules made thereunder.
19. The Company has not issued any shares, debentures or other securities during the financial year.
20. The Company has not bought back any Shares during the financial year.
21. There was no redemption of preference Shares or debentures during the financial year, as the Company has not issued any preference Shares or debentures.
22. There was no transaction necessitating the Company to keep in abeyance the rights to dividend, rights shares and bonus shares pending registration of transfer of shares.
23. The Company has not invited / accepted any deposits including any unsecured loans falling within the purview of Section 58A during the financial year.
24. The Company has not borrowed any amount during the financial year.
25. The Company has not made any loans / advances or made investments or provided guarantee to other body corporate during the Financial Year and hence no entries are required to be made in the registers kept for the purpose.
Annual Report 2008-09 FINANCIAL STATEMENTS 133
COMPLIANCE CERTIFICATE (Contd.)
26. The Company has not altered the provisions of the Memorandum with respect to the situation of the Company’s registered office from one state to another during the year under scrutiny.
27. The Company has not altered the provisions of the Memorandum with respect to the objects of the Company during the year under scrutiny.
28. The Company has not altered the provisions of Memorandum with respect to name of the Company during the year under scrutiny.
29. The company has not altered the provisions of Memorandum with respect to Share Capital of the Company during the year under scrutiny.
30. The Company has not altered its Articles of Association during the financial year.
31. There was no prosecution initiated against or show cause notices received by the Company and no fines or penalties or any other punishment was imposed on the Company during the financial year, for offences under the Act.
32. Since the Company has no employees, it has not received any money as security from its employees during the financial year.
33. Since the Company has no employees, the provisions of EPF & Miscellaneous Provisions Act, 1952 are not applicable; consequently it was not required to deduct any contribution towards Provident Fund during the financial year.
ANNEXURE – A
SI. No. Registers/Records as maintained by the Company
1. Register of Transfer u/s 108/111.
2. Register of Members u/s 150.
3. Minutes Book of Board Meetings u/s 193.
4. Minutes Book of General Meetings u/s 193.
5. Books of Accounts u/s 209.
6. Register of Notice of Interest given by the Directors u/s 299.
7. Register of Contracts, Companies and firms in which Directors are interested u/s 301.
8. Registers of Directors, Managing Director, Manager and Secretary u/s 303.
9. Register of Directors’ Shareholding u/s 307.
10. Register of Loans & Investments u/s 372A.
11. Application for and allotment of Shares.
12. Copies of Annual Return u/s 163.
ANNEXURE – B
Forms as filed by the Company with Registrar of Companies (ROC), Regional Director, Central Government or other authorities during
the financial year ended on 31st March, 2009
Sl. No. Form No./ Return Filed u/s For the period Date of filing Whether Filed within
the Prescribed time
Yes / No
If delay in filing
whether additional
fees have been paid
1. Form 23AC & Form 23ACA relate to Balance Sheet & Profit & Loss Account
220(1) Financial year ended 31.03.2008
25.07.2008 Yes NA
2. Form 66 relate to Compliance Certificate
383A Financial year ended 31.03.2008
25.07.2008 Yes NA
3. Form 20B relate to Annual Returns
159(1) For AGM held on 11.07.2008
25.07.2008 Yes NA
For D. RAUT & ASSOCIATES
2A, Ganesh Chandra Avenue (Company Secretaries)
Commerce House, 8th Floor Name of the Comapany Secretary : DEBENDRA RAUT
Room No. 8C, Kolkata 700 013 (Proprietor)
Dated : 20th May, 2009 C.P. No.: 5232
Hargaon Properties Limited 134
AUDITORS’ REPORT
We have audited the attached Balance Sheet of Hargaon Properties
Limited, Kolkata as at 31st March, 2009 and also the Profit &
Loss Account for the year ended on that date annexed thereto.
These financial statements are the responsibility of the Company’s
management. Our responsibility is to express an opinion on these
financial statements based on our audit.
We conducted our audit in accordance with the auditing standards
generally accepted in India. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether
the financial statements are free of material misstatement. An
audit includes examining, on a test basis, evidence supporting the
amounts and disclosures in the financial statements. An audit also
includes assessing the accounting principles used and significant
estimates made by the management, as well as evaluating the
overall financial statement presentation. We believe that our
audit provides a reasonable basis for our opinion.
As required by the Companies (Auditor’s Report) Order, 2003, as
amended, issued by the Central Government of India in terms of
Sub-section (4A) of Section 227 of the Companies Act, 1956, we
enclose in the Annexure, a statement on the matters specified in
Paragraphs 4 & 5 of the said Order.
Further we report that :-
i) We have obtained all the information and explanations,
which to the best of our knowledge and belief, were
necessary for the purposes of our audit;
ii) In our opinion, proper books of account as required by law
have been kept by the Company, so far as appears from our
examination of those books;
iii) The Balance Sheet and the Profit & Loss Account dealt with
by this report, are in agreement with the books of account
as submitted to us;
iv) In our opinion, the Balance Sheet and Profit & Loss Account
dealt with by this report comply with the Accounting
Standards referred to in Sub-section (3C) of Section 211 of
the Companies Act, 1956;
v) On the basis of written representations received from the
Directors as on 31st March, 2009 and taken on record by
the Board of Directors, we report that none of the Directors
is disqualified as on 31st March, 2009 from being appointed
as a director in terms of clause (g) of Sub-section (1) of
Section 274 of the Companies Act, 1956.
vi) In our opinion and to the best of our information and
according to the explanations given to us, the said accounts
give the information required by the Companies Act, 1956
in the manner so required and give a true and fair view
in conformity with the accounting principles generally
accepted in India :
a. In the case of the Balance Sheet, of the state of
affairs of the Company, as at 31st March, 2009, and
b. In the case of the Profit & Loss Account, of the Loss
of the Company for the year ended on that date.
For S. N. ROY & CO.
Chartered Accountants
29A, Madan Mohan Tala Street, S.N. ROY
Kolkata – 700 005. Proprietor
Dated : 20th May, 2009 Membership No. 51056
Annual Report 2008-09 FINANCIAL STATEMENTS 135
ANNEXURE referred to in paragraph 3 of our report of even date1. (a) The Company has maintained proper records to show full
particulars, including quantitative details and situation of fixed assets.
(b) The fixed assets of the Company have been physically verified during the year by the management, which has revealed no discrepancies between the book records and the physical inventory.
(c) During the year, none of the fixed assets have been disposed of by the Company.
2. The Company has no manufacturing and/or trading activities and as such the question of having any stock and maintenance of record in respect thereof and physical verification of inventory does not arise. Hence clauses ii(a), ii(b) & ii(c) of paragraph 4 of the aforesaid order are not applicable.
3. The Company has neither granted nor taken any loans, secured or unsecured to/from companies, firms or other parties covered in the register maintained under Section 301 of the Act and hence clauses iii(a), iii(b), iii(c), iii(d), iii(e), iii(f) & iii(g) of paragraph 4 of the aforesaid order are not applicable.
4. There is an adequate internal control system commensurate with the size of the Company and the nature of its business for the purchase of fixed assets made during the year. There is no continuing failure to correct major weaknesses in internal control system.
5. There was no transaction needed to be entered in the register in pursuance of Section 301 of Companies Act, 1956 and hence clauses v(a) & v(b) of paragraph 4 of the aforesaid order are not applicable.
6. The Company has not accepted deposits from the public during the year.
7. The Company is not a listed Company and paid up capital and reserves are less than Rs. 50 lakhs at the commencement of the financial year and also the average annual turnover is less than Rs, 5 Crores for a period of three financial years immediately preceding the financial year concern, hence clause vii of paragraph 4 is not applicable.
8. The Company is not required to maintain any cost records.
9. (a) The Company is regular in depositing undisputed statutory dues with the appropriate authorities as applicable. As the Company has no employee and no manufacturing and/or trading activities are carried on by the Company the question of payment of the Provident Fund, Employees’ State Insurance, Sales Tax, Wealth Tax, Service Tax, Custom Duty, Excise Duty, Cess etc., does not arise. According to the information and explanations
given to us no undisputed amounts payable in respect of statutory dues were outstanding as on 31st March, 2009 for a period of more than six months from the date they became payable.
(b) As at 31st March, 2009 there are no disputed dues in respect of Income Tax, Sales Tax, Wealth Tax, Custom Duty, Excise Duty, Cess, etc.
10. The Company has been registered for a period less than five years and hence clause x of paragraph 4 is not applicable.
11. The Company has not taken any term loan from any financial institution or bank. The Company does not have any borrowings by way of debentures.
12. The Company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and other securities.
13. (a) The Company is not a chit fund, nidhi or mutual benefit fund/society.
(b) In view of our comment in paragraph xiii(a) above clauses xiii(b), xiii(c) & xiii(d) of paragraph 4 of the aforesaid order are not applicable.
14. The Company is not dealing or trading in shares, securities, debentures, etc.
15. The Company has not given any guarantee for the loans taken by other parties from any bank or financial institution.
16. The Company has not raised any funds on short term basis or on long term basis. Hence clauses xvi & xvii of the aforesaid order are not applicable.
17. The Company has not made any preferential allotment of shares to parties and companies covered in the register maintained under Section 301 of the Act. The Company has not raised any money through a public issue during the year.
18. The Company has not issued any debentures. Hence clauses xix & xx of the aforesaid order are not applicable.
19. During the course of our examination of the books of account carried out in accordance with the generally accepted auditing practices in India, we have neither come across any instance of fraud on or by the Company nor we have been informed of such case by the management.
For S. N. ROY & CO.
Chartered Accountants
29A, Madan Mohan Tala Street, S. N. ROY
Kolkata – 700 005. Propreitor
Dated : 20th May, 2009 Membership No. 51056
Hargaon Properties Limited 136
BALANCE SHEETas at 31st March, 2009
PROFIT & LOSS ACCOUNTfor the year ended 31st March, 2009
SCHEDULE 31st March, 2009 31st March, 2008Rs. Rs.
SOURCES OF FUNDSShareholders’ Fund
Share Capital 1 45,00,000 45,00,000 Reserves & Surplus 2 2,36,117 2,59,269
47,36,117 47,59,269 APPLICATION OF FUNDSFixed Assets
Land 47,23,634 47,23,634 Current Assets, Loans & Advances
Current Assets 3 13,483 23,520 Less : Current Liabilities & Provisions 4
Current Liabilities 1,000 1,000 1,000 1,000
Net Current Assets 12,483 22,520 Miscellaneous Expenditure (to the extent not written off or adjusted)
Preliminary Expenses - 13,115 47,36,117 47,59,269
Accounting Policies & Notes on Accounts 5Schedules referred to above form an integral part of the Balance Sheet.In terms of our attached report of even date.
2008-2009 2007-2008Rs. Rs.
INCOMEInterest from Income Tax Department - 1,192
- 1,192 EXPENDITURE
Rates & Taxes 4,400 3,400 Land Rent 33 288 Auditors' Remuneration :
Audit Fees 1,000 1,000 Miscellaneous Expenses 4,604 6,228 Preliminary Expenses Written Off 13,115 13,115
23,152 24,031 Profit/(Loss) before Taxation (23,152) (22,839)Less : Provision for Taxation - 492Profit / (Loss) after Taxation (23,152) (23,331)Add : Profit brought forward from last year 2,59,269 2,82,600 Credit balance carried to Balance Sheet 2,36,117 2,59,269
In terms of our attached report of even date.
For S. N. ROY & CO.Chartered Accountants
29A, Madan Mohan Tala Street S. N. ROYKolkata - 700 005 Proprietor U. S. BERIADated :20th May, 2009 Membership No. 51056 K. C. GUPTA
Directors
For S. N. ROY & CO.Chartered Accountants
29A, Madan Mohan Tala Street S. N. ROYKolkata - 700 005 Proprietor U. S. BERIADated :20th May, 2009 Membership No. 51056 K. C. GUPTA
Directors
Annual Report 2008-09 FINANCIAL STATEMENTS 137
SCHEDULES to the Balance Sheet
SCHEDULE - 4 : CURRENT LIABILITIES & PROVISIONS :Current Liabilities :
Sundry Creditors for Expenses 1,000 1,000
SCHEDULE - 2 : RESERVES & SURPLUSSurplus as per Profit & Loss Account 2,36,117 2,59,269
SCHEDULE - 3 : CURRENT ASSETS Cash & Bank Balances
Cash-in-hand 356 1,856 Balance with a Scheduled Bank on Current Account 13,127 21,664
13,483 23,520
31st March, 2009 31st March, 2008Rs. Rs.
SCHEDULE - 1 : SHARE CAPITALAuthorised
5,00,000 Equity Shares of Rs. 10 each 50,00,000 50,00,000 Issued, Subscribed & Paid-up
4,50,000 Equity Shares of Rs. 10 each fully paid up in cash (Out of the above, 2,50,000 Equity Shares are held by Hargaon Investment & Trading Co. Ltd., theholding company)
45,00,000 45,00,000
Accounting Policies :Basis of Accounting The Company prepares its accounts on accrual basis in acordance with normallyaccepted accounting principles. Fixed AssetsFixed Assets are stated at cost. Preliminary Expenses Preliminary Expenses are being written off over a period of five years in equal instalments.
Signatories to Schedules - 1 to 5
SCHEDULE - 5 : ACCOUNTING POLICIES & NOTES ON ACCOUNTS
For S. N. ROY & CO.Chartered Accountants
29A, Madan Mohan Tala Street S. N. ROYKolkata - 700 005 Proprietor U. S. BERIADated :20th May, 2009 Membership No. 51056 K. C. GUPTA
Directors
Hargaon Properties Limited 138
U. S. BERIADirectors
K. C. GUPTA
BALANCE SHEET ABSTRACTAND COMPANY’S GENERAL BUSINESS PROFILEI. Registration Details
Registration No. U70101WB2003PLCO97280 State Code 21
Balance Sheet Date 31.03.2009
II. Capital raised during the year (Amount in Rs. Thousands)
Public Issue Nil Rights Issue Nil
Bonus Issue Nil Private Placement Nil
III. Position of Mobilisation and Deployment of Funds : (Amount in Rs. Thousands)
Total Liabilities 4,736 Total Assets 4,736
Sources of Funds Application of Funds
Paid-up Capital 4,500 Net Fixed Assets 4,724
Reserves & Surplus 236 Investments -
Secured Loans Nil Net Current Assets 12
Unsecured Loans Nil Miscellaneous Expenditure -
Accumulated Losses Nil
IV. Performance of Company (Amount in Rs.Thousands)
Turnover - Total Expenditure 23
Profit / (Loss) before tax (23) Profit / (Loss) after Tax (23)
Earning per share(Rs.) (0.05) Dividend Rate Nil
V. Generic Names of Principal Products / Services of the Company
(As per monetary terms)
Item Code No.(ITC Code)
Product DescriptionNot Applicable
Annual Report 2008-09 FINANCIAL STATEMENTS 139
“Good business leaders create a vision, articulate the vision, passionately own the vision, and relentlessly drive it to completion.”- Jack Welch
140
Late Dr K.K. Birla
(1918-2008)
Our Source of Inspiration
print anderson 9831778971
Growing sustainably.And profitably.
The Oudh Sugar Mills LimitedAnnual Report 2008-09
The Oudh Sugar Mills Limitedwww.birla-sugar.com
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