JASCH INDUSTRIES LTD (An ISO 9001:2008 Company) 25 ANNUAL REPORT ( BOARD OF DIRECTORS S.K. KHANDELWAL (DR.) K.C. VARSHNEY (DR.

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1 JASCH INDUSTRIES LTD (An ISO 9001:2008 Company) ANNUAL REPORT ( BOARD OF DIRECTORS J.K. GARG MANISH GARG RAMNIK GARG NAVNEET GARG KAMLESH GARG (MS) O.P. GARG S.K. KHANDELWAL (DR.) K.C. VARSHNEY (DR.) ASHOK MITTAL (DR.) KULDEEP SINGAL K.L. KHETARPAUL CHAIRMAN & MANAGING DIRECTOR WHOLE TIME DIRECTOR WHOLE TIME DIRECTOR WHOLE TIME DIRECTOR DIRECTOR EXECUTIVE DIRECTOR DIRECTOR DIRECTOR DIRECTOR DIRECTOR DIRECTOR COMPANY SECRETARY S.K. VERMA AUDITORS Arora & Choudhary Associates Chartered Accountants (Regiration No N) 8/28, W.E.A Abdul Aziz Road, BANKERS Karol Bagh, New Delhi STATE BANK OF INDIA OVERSEAS BRANCH, JANPATH, NEW DELHI REGISTRARS Alankit Assignments Ltd. (Unit : Jasch Induries Ltd) 2E/21, Jhandewalan Extn., New Delhi Silver Jubilee REGISTERED OFFICE AND WORKS 43/5, BAHALGARH ROAD, P. O. BAHALGARH, DISTT. SONEPAT (HARYANA) CORPORATE OFFICE 502, BLOCK C, NDM-2, NETAJI SUBHASH PLACE, PITAMPURA, DELHI CONTENTS 1 NOTICE OF MEETING DIRECTORS' REPORT CORPORATE GOVERNANCE REPORT AUDITORS' REPORT ON FINANCIAL STATEMENTS BALANCE SHEET PROFIT & LOSS ACCOUNT CASH FLOW STATEMENT SCHEDULES FORMING PART OF BALANCE SHEET AND PROFIT AND LOSS ACCOUNT SIGNIFICANT ACCOUNTING POLICIES AND NOTES ON ACCOUNTS

2 NOTICE OF ANNUAL GENERAL MEETING To The Members, NOTICE is hereby given at e Annual General Meeting of Members of JASCH INDUSTRIES LIMITED will be held on Friday, e 30 day of September, 2011 at 10:00 AM at Regiered Office of e Company at 43/5, Bahalgarh Road, PO, Bahalgarh, Dit. Sonepat , Haryana, to transact e following business : ORDINARY BUSINESS : AGENDA ITEM NO. 1 : To receive, consider and adopt e audited Profit and Loss Account for e year ended 31 Balance Sheet as at at date and e Reports of e Directors and e Auditors ereon. March, 2011, e AGENDA ITEM NO. 2 : To declare dividend for e financial year ended 31 March, AGENDA ITEM NO. 3 : To appoint a Director in place of Shri O.P. Garg who retires by rotation, and being eligible, offers himself for re-appointment. AGENDA ITEM NO. 4 : To appoint a Director in place of Dr. S.K. Khandelwal who retires by rotation, and being eligible, offers himself for re-appointment. AGENDA ITEM NO. 5 : To re-appoint Auditors and in is connection, to consider and if ought fit to pass wi or wiout modification(s) e following resolution as an Ordinary Resolution: RESOLVED THAT e retiring auditors M/s Arora & Choudhary Associates, Chartered Accountants, being eligible for reappointment, be and are hereby re-appointed as auditors to hold office from e conclusion of is meeting until e conclusion of e next Annual General Meeting, on a remuneration of such sum as may be fixed by e Board of Directors / any Committee of e Board of Directors, plus service tax and reimbursement of out of pocket expenses as may be incurred in e performance of eir duties.. SPECIAL BUSINESS AGENDA ITEM NO. 6 : SPECIAL RESOLUTION : TO CONSIDER AND, IF THOUGHT FIT, TO PASS WITH OR WITHOUT MODIFICATIONS, THE FOLOWING RESOLUTION AS RESOLVED THAT Shri Jai Kishan Garg be and is hereby re-appointed Managing Director for a period of five years w.e.f. 1 May, 2011 on remuneration, terms and conditions as sanctioned by remuneration committee and as set out in e Explanatory Statement. AGENDA ITEM NO. 7 : TO CONSIDER AND, IF THOUGHT FIT, TO PASS WITH OR WITHOUT MODIFICATIONS, THE FOLOWING RESOLUTION AS SPECIAL RESOLUTION : Silver Jubilee RESOLVED THAT Shri Navneet Garg be and is hereby re-appointed Whole Time Director for a period of five years w.e.f. 1 May, 2011 on remuneration, terms and conditions as sanctioned by remuneration committee and as set out in e Explanatory Statement. AGENDA ITEM NO. 8 : TO CONSIDER AND, IF THOUGHT FIT, TO PASS WITH OR WITHOUT MODIFICATIONS, THE FOLOWING RESOLUTION AS SPECIAL RESOLUTION : RESOLVED THAT e exiing Clause V of Memorandum of Association and e exiing Article 3 of Articles of Association of e Company be and are hereby subituted wi e following : The Auorised Share Capital of e Company is Rupees 14,00,00,000 (Rupees Fourteen Crores) divided into 1,40,00,000 (one Crore Forty Lakh) equity shares of 10 (Rupees ten) each. By Order of e Board of Directors For JASCH INDUSTRIES LTD Place : Sonepat 18 July, 2011 S.K. VERMA COMPANY SECRETARY 2

3 NOTES 1. Explanatory Statement relating to Agenda Item No. 6, 7 and 8 is annexed and forms part of is Notice. 2. A Member entitled to attend and vote at e Meeting is entitled to appoint a proxy and vote in his ead. The proxy need not be a member of e Company. Proxy in e order to be valid, mu be lodged at e Regiered office of e Company not less an 48 hours, before e commencement of Meeting. 3. A Member or his Proxy is requeed to produce at e entrance of e Regiered Office, Attendance Slip forwarded to em along wi is Annual Report, to facilitate eir attendance at e AGM. 4. Members desirous of getting any information related to e accounts of e Company for e period under reference are requeed to write to e Company at lea ten days before e meeting, to enable it to make e requisite details available at e Meeting. 5. Members are requeed to address all correspondence, including intimation of change in eir addresses, if any, to M/s Alankit Assignments Ltd, who are Regirars & Share Transfer Agents of e Company and whose address is given in Corporate Governance Report. 6. The Regier of Members and Share Transfer Regiers of e company will remain closed from 1 September, 2011 to 30 September, 2011, bo days inclusive. 7. Subject to e provisions of Section 206A of e Act, dividend as declared at e meeting, will be payable on or after 5 day, of October, 2011 (being5 dayfrome date of declaration) toose members whose names appear one Regier of Members as on01 Dayof September, Members holding shares in electronic form may please note at: (a) e dividend, when declared, will be credited to eir respective Bank Accounts as furnished to e Depository Participants rough e National Electronic Clearing Service (NECS) where is facility is available; (b) in oer cases, Bank details as furnished to e Depository Participants will be printed on e dividend warrants as per e applicable regulations. The company shall not entertain any direct communications for deletion of / change of such Bank details. Furer, it may be noted at inructions, if any, already given by e members in respect of e shares held in physical form will not be automatically applicable to e dividend paid on eir holding in electronic form. 9. Pursuant to Section 205C of e Act, e amount of dividend remaining unpaid or unclaimed for a period of seven years from e date of transfer to e company's Unpaid Dividend Account, will be transferred, to e Inveor Education and Protection Fund (e Fund) set up by e Government of India and no payments shall be made in respect of any such claims by e Fund. 10. As e equity shares of e company are compulsorily traded in demat form, members holding equity shares physical form are requeed to get e shares converted in demat form. 11. Members holding equity shares in physical form are hereby requeed to promptly notify e change of address/ dividend mandate, if any, to e company's Regirar and Share Transfer Agents, Alankit Assignments Ltd (2E/21, Jhandewalan Extension, New Delhi) quoting eir folio number and Members holding equity shares in demat form shall have to intimate to eir respective Depository Participants quoting eir Client ID. 12. Members who have not regiered eir addresses so far are requeed to regier eir addresses, in respect of electronic holdings wi e Depository rough eir concerned Depository Participant. Members who hold shares in physical form are requeed to regier eir addresses wi Alankit Assignments Ltd (2E/21, Jhandewalan Extension, New Delhi)., Regirar and Share Transfer Agent of e company. Silver Jubilee 13. To avoid loss of dividend warrants in transit and undue delay in receipt ereof, members are advised to avail e facility for receipt of future dividends rough National Electronic Clearing Service (NECS). The NECS facility is available at e locations identified by Reserve Bank of India from time to time which covers mo of e cities and towns. Members holding shares in dematerialized mode are requeed to contact eir respective Depository Participant (DP) for availing NECS facility. Members holding shares in physical form and who have not submitted e NECS details and desirous of availing NECS facility are requeed to send to e company or to e Share Transfer Agents e details such as: e name of e Shareholder, Bank rough which account held, Bank Account number and MICR details immediately and wherever possible e reque shall be acceded to. 14. Members are requeed to make use of Nomination facility by filing Form 2B. In case of shares held in demat mode Form 2B has to be lodged wi e respective DP and in case of e shares held in physical mode e same has to be lodged wi e company or its Share Transfer Agents. 15. Members are requeed to bring a copy of e Annual Report along wi em to e Annual General Meeting since as a measure of economy as extra copies will not be supplied at e meeting. 16. Members, who hold shares in dematerialised form are requeed to bring eir Client ID and DP ID Nos. for easier identification of attendance at e meeting. 17. FOR SPECIAL ATTENTION OF MEMBERS : NO GIFTS/COUPONS WILL BE DISTRIBUTED AT THE ANNUAL GENERAL MEETING. 3

4 Important Communication to Members The Miniry of Corporate Affairs has taken a Green Initiative in e Corporate Governance by allowing paperless compliances by e companies and has issued circulars ating at service of notice / documents including Annual Report can be sent by to its members. To support is green initiative of e Government in full measure, members who have not regiered eir addresses, so far, are requeed to regier eir addresses, in respect of electronic holdings wi e Depository rough eir concerned Depository Participants. Members who hold shares in physical form are requeed to regier eir id wi Alankit Assignments Ltd (Regirar and Share Transfer Agents of e company) by sending a reque letter duly signed by e fir / sole shareholder. AGENDA ITEM NO. 6 EXPLANATORY STATEMENT PURSUANT TO SECTION 173(2) OF THE COMPANIES ACT, 1956 IN RESPECT OF AGENDA ITEM NOs. 6, 7 & 8 Shri Jai Kishan Garg, 64 is a Mechanical Engineer. He has been associated wi e Company as Chairman and Whole Time Director since its inception in e year His la re-appointment for a period of five years was approved by e Board in its Meeting held on 29 April, 2006, The re-appointment was for a period of five years w.e.f The Remuneration Committee of e Board had initially fixed his salary at 55,000 per mon in e scale of 55,000 75,000 which was later increased to 1,00,000 w.e.f. 01 April, 2007 for e remaining term of his tenure. Bo of ese remunerations were approved by e Shareholders in e Annual General Meetings held on 15 September, 2006 and on 28 Sept, 2007 respectively. The aforesaid period of 5 years came to an end on and e Board of Directors of e Company, in eir Meeting held on re-appointed him for a furer period of five years. As prescribed under Schedule XIII of e Companies Act, 1956, e remuneration of Directors is required to be fixed by e Remuneration Committee and approved by e Shareholders. While fixing his remuneration, e Remuneration Committee of e Board, in its Meeting held on passed e following Resolution : RESOLVED THAT subject to approval of e Company in e forcoming Annual General Meeting, e remuneration and perks of Shri Jai Kishan Garg, Managing Director be and are hereby sanctioned as follows : Monly Salary : 1,00,000 per mon. ANNEXURE TO NOTICE Perks : In addition to salary, he will be entitled to following perks : 1. Chauffeur-driven car for official use only. 2. Telephone at residence and mobile phone for official use only. 3. Special Allowance not exceeding six mons' salary in a year, to cover housing, conveyance, telephone, medical, electricity, gas, water and oer personal expenses. 3. Gratuity as per law Terms & Conditions : Silver Jubilee He will be entitled to e above remuneration and perks even in case ere are no profits or if e profits are inadequate. The remuneration and perks shall be payable if e appointee and e Company fulfill e conditions of eligibility and quantum as laid down under Schedule XIII of e Companies Act, This appointment will be terminable by eier side by giving ree mons' notice in writing. AGENDA ITEM NO. 7 Shri Navneet Garg, 35, is a Mechanical Engineer. At e time of his fir appointment in e Company on 7 April, 2005 as Production Manager, he had eleven years' experience in production of Synetic Leaer. Later, in e Board Meeting held on 29 April, 2006, he was appointed as Whole Time Director for a period of five years w.e.f. 01 April, The Remuneration Committee of e Board had initially fixed his salary at 30,000 in e scale of plus perks which was later increased to ` 50,000 w.e.f. 01 April, 2007 for e remaining term of his tenure. Bo of ese remunerations were approved by e Shareholders in e Annual General Meetings held on 15 September, 2006 and on 28 Sept, 2007 respectively. The aforesaid period of 5 years came to an end on and e Board of Directors of e Company, in eir Meeting held on reappointed him for a furer period of five years. As prescribed under Schedule XIII of e Companies Act, 1956, e remuneration of Directors is required to be fixed by e Remuneration Committee and approved by e Shareholders. While fixing his remuneration, e Remuneration Committee of e Board, in its Meeting held on passed e following Resolution : 4

5 RESOLVED THAT subject to approval of e Company in e forcoming Annual General Meeting, e remuneration and perks of Shri Navneet Garg, Whole Time Director be and are hereby sanctioned as follows : Monly Salary : 70,000 per mon in e scale of 70,000 1,00,000. Perks : In addition to salary, he will be entitled to following perks : 1. Chauffeur-driven car for official use. 2. Telephone at residence and mobile phone for official use. 3. Reimbursement of electricity bills, consumption of gas, water, conveyance, telephone, medical and oer personal expenses, subject to a maximum of six mons' salary in a year. 3. Gratuity as per law Terms & Conditions : He will be entitled to e above remuneration and perks even in case ere are no profits or if e profits are inadequate. The remuneration and perks shall be payable if e appointee and e Company fulfill e conditions of eligibility and quantum as laid down under Schedule XIII of e Companies Act, This appointment will be terminable by eier side by giving ree mons' notice in writing.' AGENDA ITEM NO. 8 At present e Auorised Capital of e Company is 10 lakhs and e Paid Up Capital is 1133 lakhs. In order to meet its future grow objectives and to rengen its financial position it may, in future, need to generate long term resources by issuing furer shares in accordance wi law prevailing at at time. It is, erefore, proposed to make an enabling provision at is age only, by amending e Capital Clause of e Memorandum of Association of e Company and also by making consequential amendment in e Articles of Association of e Company. The provisions of Companies Act, 1956 requre e Company to seek e approval of Members by way of a Special Resolution, for alteration of Capital Clause of Memorandum of Association and Articles of Association of e Company. The Directors recommend passing of e Resolutions proposed at Agenda Item Nos. 6, 7 and 8 as Special Resolutions. Disclosure of intere : None of e Directors is intereed in e aforesaid Resolutions except Shri Jai Kishan Garg, Smt. Kamlesh Garg, Shri Ramnik Garg, Shri Manish Garg and Shri Navneet Garg, who may be deemed to be intereed in Resolutions at Agenda Item Nos. 6 and 7, being relatives/re-appointees. 18 July, 2011 Regiered Office : Jasch Induries Ltd. 43/5, Bahalgarh Road, P.O. Bahalgarh, Dit. Sonepat Haryana Silver Jubilee By Order of e Board For Jasch Induries Ltd. S. K. Verma COMPANY SECRETARY 5

6 Your Directors have pleasure in presenting e Annual report and audited accounts of e company for e year ended 31 March FINANCIAL RESULTS DIRECTORS' REPORT ` lakh Particulars Current year Previous Gross Sales Less Excise Duty/vat/service tax Net Sales Turnover Oer Income Net sales and & oer income Operating Profit before Intere Depreciation, Income Tax, Exceptional Items & Prior Periods Adjuments Intere & Financial Charges Gross Profit Before Depreciation Depreciation Less : Provision for income tax Net profit before deferred tax Add / (Deduct) : Provisions for deferred Tax (Assets) / Liability (3.69) Net profit available for appropriation Surplus brought forward from previous year Transfer to general reserve 30.0 Provision for dividend including dividend diribution tax surplus carried forward to balance sheet DIVIDEND In view of satisfactory performance of e company during e year , e Management is pleased to recommend maiden 10% i.e. ` 1 on face value of ` 10 each at Silver Jubilee Annual General Meeting ( ) of e Company. The total dividend outgo would workout to ` lakh comprising dividend of ` lakh and dividend diribution tax of ` lakh. PERFORMANCE DURING THE YEAR Your company has achieved gross sales of ` lakh during which were 17.13% higher as compared wi e sales of e previous year. The sales of Synetic Leaer Division at ` 6548 lakh during were higher by 21.48% as compared wi e sales of previous year. The sales of Electronic Gauge Division at ` lakh during e year under review were marginally 2.97% higher as compared wi e previous year. The Electronic Gauge Division has achieved exports of ` lakh during e year under review including a very preigious export order of Gauges to ArcelorMittal in Kazakhan. The grow of 17.13% in production and sales of Synetic Leaer Division is significant especially in view of recessionary conditions in user induries. The company is continuing Modernization of PU Synetic Leaer Division by inalling a New DMF Recovery Plant of higher capacity wi improved energy efficiency, which will result in higher production of PU Synetic Leaer at lower co of production. The company's operating profit before intere, depreciation, income tax and deferred tax has increased by 28% to ` lakh during as compared wi ` lakh during e previous year. The subantial Improvement in operating profit has been achieved despite sharp increase in e prices of raw material on account of e inflationary pressure in e economy. Despite increase in e rate of intere on finance by e bankers and availment of term loan for modernization of Plant & Machinery and DMF Recovery plant and increase in e production and sales, e company has managed to contain intere and finance charges at ` lakh which was only 13% higher as compared wi e previous year due to efficient management of financial resources. The gross profit before depreciation and income tax has also increased to ` lakh during e year , which is 35.4% higher an at of e previous year. After providing depreciation of ` lakh and provision of income tax of ` lakh, e company has earned net profit before deferred tax of ` lakh, which was 49.1% higher as compared wi net profit of ` lakh in e previous year. After providing deferred income tax of ` lakh consequent to capitalization of fixed assets, e company has achieved net profit of ` lakh during e year under review. The cash profit of e company wiout taking in to account notional deferred income tax has increased to ` lakh during e year as compared wi cash profit of ` lakh in e previous year. Keeping in view recessionary conditions particularly in e international market, which adversely effected export of Electronic Gauges during e year and wide fluctuation in e prices of main raw materials, e Management considers overall performance of e company during e year under review quite satisfactory. CREDIT RATING AND ISO 9001 CERTIFICATION The Company's performance and financial position was rated by CRISIL Ltd, e Premier credit rating agency in e country. CRISIL has assigned BBB Stable rating to fund based long term bank loans and + P-3 to non-fund based facilities from State Bank of India. Our rating reflects moderate safety to timely payment of financial obligations and Silver Jubilee 6 comes under Invement Grade rating. The Company has obtained ISO 9001:2008 and ISO 9001:2000 Quality Certificates for its Synetic Leaer and Electronic Gauge Division respectively. INSURANCE CLAIM The company's insurance claim of ` lakhs regarding fire accident in November, 2001 continues to be pending in Delhi High Court. Necessary provisions would be made after e case is settled by e court. The company has taken adequate insurance cover for e building, Plant & Machinery and inventory. FUTURE PROSPECTS The company has achieved consient increase in production and sales in e la few years due to e Management's focus on continuous upgradation and modernization of plant and machinery and development of innovative products. In view of inallation of New DMF recovery Plant of higher capacity wi better energy efficiency, e Management is optimiic at, besides increasing production capacity of PU synetic Leaer & sales, is up-gradation will also result in subantial saving in co of power and fuel, ereby improving profitability of e company in e next 2-3 years. Therefore, management expects better results in e current year as well as in future. MANAGEMENT DISCUSSION AND ANALYSIS REPORT: Please refer to Annexure A to is Report. INFORMATION PURSUANT TO SECTION 217(1) (a) OF THE COMPANIES ACT, 1956 Information in accordance wi section 217 (1) (a) of Companies Act, 1956 read wi rule 2 of e Companies (Disclosure of Particulars in e Report of Board of Directors ) Rules, 1988 and Particulars Relating to Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo is at Annexure B to is Report. CORPORATE GOVERNANCE Corporate Governance Report is contained as a separate Section in e Annual Report.

7 INFORMATION IN ACCORDANCE WITH SECTION 217 (2A) OF THE COMPANIES ACT 1956 WITH COMPANIES (PARTICULARS OF EMPLOYEES) RULES The Company had no employees drawing remuneration of ` 60 lakhs or more per annum or, if employed for a part of e year, ` 5 lakhs or more per mon during e year under report. FIXED DEPOSITS The Company did not accept/renew any fixed deposits during e year under report. The deposit outanding as on 31 March 2011 was Nil. LISTING The Shares of e Company are traded at Mumbai Stock Exchange. The Company has sought voluntary deliing of its shares from Kolkata Stock Exchange. DIRECTORS Shri O.P. Garg and Dr. S.K. Khandelwal, Directors, retire by rotation at e ensuing Annual General Meeting and being eligible, offer emselves for re-appointment. In addition, Shri J.K. Garg, Managing Director and Shri Navneet Garg, Whole Time Director, who had completed eir tenure of five years on have also offered emselves for re-appointment. The directors recommend eir reappointments. A brief resume of ese proposed re-appointees is given in e Corporate Governance Report. AUDITORS & THEIR REPORT M/s Arora and Choudhary Associates, Chartered Accountants retire as Auditors of e Company at e ensuing Annual General Meeting and being eligible, offer emselves for re-appointment. The company has received a letter from em at eir reappointment, if made would be wiin e prescribed limit under section 224(1B) of Companies Act, 1956 and at ey are not disqualified from being reappointed as Auditor U/s 226. The Directors and e Audit Committee recommend eir re-appointment. Auditors' Report is self-explanatory and requires no comments by e Directors. executives and atutory auditors of e Company are permanent invitees to e Audit Committee Meetings. Shri S.K. Verma, Company Secretary is e Secretary of e Audit Committee. DIRECTORS' RESPONSIBILITY STATEMENT Pursuant to Section 217(2AA) of e Companies Act, 1956, as introduced by Companies (Amendment) Act, 2000, e Directors confirm at : (i) in e preparation of e annual accounts, e applicable accounting andards have been followed; (ii) appropriate accounting policies have been selected and applied consiently, and judgments and eimates made are reasonable and prudent so as to give a true and fair view of e ate of affairs of e Company as at 31 March, 2011 and of e profits of e Company for e year ended 31 March, (iii) proper and sufficient care has been taken for e maintenance of adequate accounting records in accordance wi e provisions of e Companies Act, 1956 for safeguarding e assets of e Company and for preventing and detecting fraud and oer irregularities. (iv) e annual accounts have been prepared on a going concern basis. ACKNOWLEDGMENTS Your directors are pleased to place on record eir sincere anks to e Bankers and business associates of e company for eir continued and valuable co-operation and support to e Company. Your Directors also express eir appreciation for e hard work and sincere services rendered by workers, aff and executives of e Company during e year. AUDIT COMMITTEE The Audit Committee conituted by e Board in compliance wi Section 292A of e Companies Act, 1956 and under e Liing agreement, comprised of Dr. K.C. Varshney, Shri Kuldeep Singal and Shri S.K. Khandelwal all of whom are non-executive Directors. Dr. Varshney, who is e Chairman of e Audit Committee, is a retired executive director of Indurial Development Bank of India wi more an 38 years' experience in e field of corporate finance, and as such has sound knowledge of financial matters. The finance Silver Jubilee Place : Sonepat Date : 18 July, 2011 For & on behalf of e Board (J.K.GARG) Chairman 7

8 PRODUCT INTRODUCTION Jasch Induries Ltd. manufactures PVC/PU Coated Fabrics (also known as Synetic Leaer or Artificial Leaer) and Allied Products & Nucleonic & X-Ray Source based Thickness Gauging Syems in Electronic Gauge Division. The major business segment & eir product applications are as follows :- Business Segment Product Application - PU/PVC Coated Fabric & Used in Footwear, Garment Allied products Upholery, Automobile Luggage & sports Goods - Electronic Gauges Used for online measurement of ickness, grammage, moiure & ash contents in Paper Making Indury, on line measurement of ickness & coating weight in Plaics, Steel Sheet Rolling, Galvanizing Sheet, Aluminum foil & Non Ferrous Metal Rolling Indury ( ` in Lakh) Business Diribution Value Value - PU/PC Coated Fabrics % % - Electronic Gauges % % % % As may be seen from above, e business of Synetic Leaer has shown higher rate of grow an Electronic Gauge due to continuous modernization in Synetic Leaer Division and slightly slackening of orders for Electronic Gauge due to recession in e user induries. INDUSTRY STRUCTURE AND DEVELOPMENT PU/PVC Coated Fabric also known as Synetic Leaer is moly used in Footwear Indury as raw material for Shoe-Upper, Lining, Insole, Chappal & Sandal Straps etc. It is also used in Garments as Lining Material, as Automobile seat cover & Furniture upholery material, in Ladies and Gents Purses and Bags and in e manufacture of sports goods & Accessories. Synetic Leaer Indury in India is badly fragmented & somewhat concentrated in Norern India & Weern India. Mo of e units are in small scale and unorganized sector manufacturing cheap quality products for small & unorganized sector. The Indury has not been able to achieve its full potential due to tough competition from imported material from China, Taiwan, Hong Kong & Korea, where ere are very large units enjoying benefits of economies of scale. The competition has become more acute in e la 2-3 years due to declining cuom tariff barrier. However, e company has been able to wiand competition bo domeic and from abroad, as it is an integrated player wi in-house manufacturing facility for PU Resin, which is main raw materials for PU coated Fabrics. Furer, e company is continuously upgrading its technology and modernizing plant & machinery to maintain competitive edge in e market and hence despite tough competition in e market, its sales are growing every year and it has achieved 17.13% increase in production and sales during The company is now concentrating on PU Synetic Leaer where competition is somewhat less. ANNEXURE A TO DIRECTORS' REPORT MANAGEMENT DISCUSSION & ANALYSIS REPORT (PURSUANT TO CLAUSE-49 OF THE LISTING AGREEMENT WITH STOCK EXCHANGES) Key performance parameters of Synetic Leaer Segment are as under :- ( ` lakhs) Production lakh meter Segment Revenue Segment Profits/(Loss) before intere & oer common unallocable expenditure Capital Employed ELECTRONIC GAUGE AUTOMATION DIVISION Technology for Electronic Gauging Syems has been developed by in-house research & development. This division's performance has been satisfactory as may be evident from e following results. Silver Jubilee ( ` Lakhs) Production (in Nos.) (Gauges + Parts) Segment Revenue Segment Profits before intere & oer common unallocable expenditure Capital Employed The company has executed large export orders of Electronic Gauges to ArcelorMittal, Kazakhan during e year. The Electronic Gauges are used in various induries as Capital Goods item, hence market for electronic Gauges depends upon invement in users induries. In view of recessionary trends particularly in international market e company has been able to increase only marginally production and sale of Electronic Gauges. The export of Electronic Gauges was foreign currency equivalent of ` 760 lakh during e year under review. (i) Fixed Assets The gross fixed assets including capital work in progress of ` lakh were ` lakh as on 31 March The net addition of fixed assets of ` lakh was due to ongoing modernization, inallation of balancing equipments and capital expenditure on inallation of New DMF Recovery Plant during e year. (ii) Current Assets The net current assets as on 31 March, 2011 were ` lakhs as compared wi ` lakh in e previous year resulting a marginal increase of ` lakh during e year due to increase in inventory & sundry debtors consequent to higher production and sales. (iii) Working Capital and Borrowings The working capital borrowing from e Bank increased by ` lakh to ` lakh as on to finance higher production and sales during e year. Over all secured debts of e company increased from ` lakh as on to ` lakh as on due to availment of additional term loan for ongoing modernization and higher working capital borrowing. The net wor of e company has increased from ` lakh as on to ` lakh as on due to retention of profit after payment of proposed dividend. Overall secured debts to equity ratio increased from 0.65:1 as on to 0.85:1 as on due to availment of term loan and higher working capital from Bank. 8

9 RISK MANAGEMENT Risk is an integral part of any business, more so in India. A brief evaluation of business risk of Jasch Induries Ltd. as perceived by e Management is as under:- 1. Business Segment Risk a. User Indury Concentration PVC/PU Synetic Leaer is used across a wide spectrum of Induries. However Company's products are moly (upto 75% of total) used in Footwear Indury. Therefore, e fortunes of e company are invariably inter linked wi at of Footwear Indury. Any downward trend in Footwear Indury will have significant impact on e company. The company is making efforts to increase usage of its products in oer Induries such as Automobile & General purpose Up-holery, Sports Goods and Garment Induries & it is hoped at over e next few years e share of Footwear Indury may come down to 60%. b. Cuomer & Geographical concentration Excessive exposure to a few large clients has e potential to adversely affect e sales and profitability in view of failure/shift of clients to oer manufacturers. Fortunately, e company's cuomers and dealers are fairly spread out across e country bo in respect of Coated Fabrics & Electronic Gauges. c. Technological Obsolescence Right from e beginning, e company has been engaged in its own Research & Development activity wi a view to improve upon/modify e process and product to suit Indian tropical conditions and usage practices. Over e years, e company has been able to develop many new products/applications. Furer, e Company has entered into a fresh technical collaboration agreement wi DUKSUNG COMPANY LTD., Korea in September, 2010 for a period of 3 years for up gradation of technology, development of new products and saving in e co of inputs. The Company has developed e technology in-house for e design and manufacture of Nucleonic and X-ray Thickness Gauging Syem which is being furer upgraded continuously. Hence, ere is no reat of obsolescence in near future. Also e cuomers of Synetic Leaer and Electronic Gauges are spread all over India and abroad and ere is no Geographical or user concentration. FINANCIAL RISK (a) Currency Risk The currency risk emerges from e potential upward or downward fluctuations in foreign currency. The Company's foreign exchange spending by way of import of raw materials and consumables currently conitutes about 45.5% of total co of raw material and Silver Jubilee consumables. The Thickness Gauging Syem has large export potential, which will provide cushion by way of natural hedge on foreign exchange transactions. The company incurred foreign currency expenditure of ` 2858 lakhs during e year (including capital goods of ` 533 lakh and foreign travel of ` 13.0 lakh) again exports in foreign currency were of ` 773 lakh (Electronic Gauge - ` 760 lakh and Synetic Leaer ` 13.0 lakh), which provides some cushion again adverse fluctuation in foreign currency. The company's foreign currency transactions are on current account basis and ere are no deferred liabilities in terms of foreign exchange except small amount due in respect of raw material imported on deferred payment basis upto 31 March, 2011 and to be paid later. (b) Intere and Leverage Risk Wi a view to contain inflationary pressure in e economy e RBI is continuously increasing e intere rate in e la 18 mons resulting in higher intere on borrowing from e Banks. The management is trying to contain intere co by efficient management of inventory and working capital resources and availment of short term borrowings in foreign currency at subantially lower intere for financing import of raw materials. HUMAN RESOURCES The Company did not have any labour problem during Relation wi worker and Staff were cordial. INTERNAL CONTROL The Management is having tight control on all e operations of e Company. All expenses are scrutinized and approved by e top management. The Company has also introduced Internal Audit Syem so as to have proper check and control on every department. Adequacy of internal Control Syem is periodically reviewed by e Audit Committee of e Board for corrective action to be taken, if any. CAUTIONARY STATEMENT Statements in is directors' report & management discussion and analyses describing e company's objectives, projections, eimates, expectations or predictions may be "forward looking atement" wiin e meaning of applicable securities laws and regulations. Actual results could differ materially from ose expressed/implied. Important factor at could make a difference to e company's operations include raw material availability and prices, cyclical demand and pricing in e company's principal markets, change in e Government regulations, tax regime, economic developments wiin India and e countries in which e company conducts business and oer incidental factors. Place : Sonepat Date : 18 July, 2011 For & on behalf of e Board (J.K.GARG) Chairman 9

10 FORM A (See Rule - 2) 1. CONSERVATION OF ENERGY : Wind operated fans have been inalled in ceiling of factory building for proper ventilation. Since ese are run by wind power, ese do not consume energy. Periodic energy consumption audit is carried out and corrective action taken such as replacement of higher HP Motors by lower HP Motors, wiout affecting operational efficiency. The company has inalled capacitors to improve power factor resulting in lower power co / consumption. The company has switched over from furnace oil / LDO to Petro-coke and firewood to reduce co of fuel. For lighting, maximum use of CFL is being made. FORM A (See Rule - 2) A) POWER AND FUEL CONSUMPTION DURING THE YEAR ENDED ) ELECTRICITY PURCHASES KWH UNITS IN LAKH TOTAL AMOUNT ` IN LAKH AVERAGE RATE ` PER UNIT 2) FUEL FOR DG SET QUANTITY(LTRS) TOTAL COST AVERAGE RATE 2. TECHNOLOGY ABSORPTION, ADAPTATION AND INNOVATION ANNEXURE B TO DIRECTORS' REPORT INFORMATION PURSUANT TO SECTION 217(1)(A) OF THE COMPANIES ACT, 1956 READ WITH COMPANIES (DISCLOSURES OF PARTICULARS IN THE REPORT OF BOARD OF DIRECTORS) RULES, LAKH ` IN LAKH ` PER LTR 3) FUEL FOR BOILER LAKH KGS (PETRO COKE & FIRE WOOD) TOTAL COST ` IN LAKH AVERAGE RATE ` PER KG 4) OWN GENERATION THROUGH DIESEL GENERATORS UNIT PER LTR. OF DIESEL COST UNITS IN LAKH ` PER UNIT NOTE Since e Company produces a number of different products wi common utility services, it is not feasible to work out product wise energy consumption per unit of production. i) Efforts, in brief, made towards technology absorption, adaptation and innovation ii) iii) Silver Jubilee Coated Fabrics to reputed shoe manufacturers such as Reebok, Nike, Bata, etc. e company has furer renewed e technical collaboration wi Duksung company Ltd., Sou Korea for a furer period of ree years from September, 2010 at nominal fee of USD per annum for up gradation of Technology and development of new products. Benefits derived as a result of e above efforts e.g. product improvement, co reduction import subitution etc. The use of technology has contributed to subantial saving in foreign exchange for e country, as many products developed by e company were imported earlier. The company has developed many new verities of PU Synetic Leaer for use in premium quality sports shoes being manufactured by many multinational companies in India. Imported Technology (imported during e la 5 years reckoned from e beginning of e financial year) Technology imported Technology for manufacture of PU Coated Fabrics from Duksung Company Ltd., Korea of import and Has technology been fully absorbed If not fully absorbed, areas where is has not taken place, reasons erefore and future plans of action Yes. The technology imported during has been fully absorbed. The technology transfer for new collaboration is under progress on continuous basis. 3. The co of Research & Development is included in respective heads of accounts and not kept separately. 4. Outgo by way of foreign exchange (CIF) during ( ` in Lakh) a. Foreign exchange outgo b. Foreign exchange earnings US$ Euro The Company had entered into a Technical Collaboration Agreement wi Duksung Company Ltd, Sou Korea for developing advance technology for e manufacture of Premium quality PU Coated fabrics in September, 2006 valid for a period of ree years. The Company has fully absorbed and adopted e technology and successfully marketed Premium quality PU Place : Sonepat Date : 18 July, 2011 For and on behalf of Board of Directors (J.K.Garg) Chairman CORPORATE GOVERNANCE REPORT CORPORATE GOVERNANCE DISCLOSURE PURSUANT TO CLAUSE 49 OF THE LISTING AGREEMENT WITH STOCK EXCHANGES Corporate Governance Report of e Company for e financial year ended on 31 March, 2011 is as follows: 1. COMPANY'S PHILOSOPHY ON CODE OF GOVERNANCE The Company's philosophy on corporate governance is "Governance rough use of collective wisdom of Directors and transparency in business dealings so as to be fair and also serve e be interes of all akeholders e.g. shareholders, employees, cuomers, suppliers and society at large." 2. BOARD OF DIRECTORS a) Details of directors, eir attendance at Board Meetings during e financial year , eir attendance at previous Annual General meeting and number of memberships held by em in e Board/Committees of various companies. 10

11 Name Category Attendance Number of directorships/ Wheer (Shri) at Board committee member/chairmanships attended Meetings including at in Jasch la AGM Meetings Committee~ Directorships# Member Chairman J.K. Garg E&P Yes Kamlesh Garg (Ms) P Yes S.K. Khandelwal (Dr) NE&I Yes Ramnik Garg E&P Yes Manish Garg E&P Yes Navneet Garg E&P Yes K.C. Varshney (Dr) NE&I Yes Ashok Mittal (Dr) NE&I Yes Kuldeep Singal NE&I Yes O.P. Garg E Yes Shri K.L. Khetarpaul N&I Yes E = Executive, P=Promoter, NE=Non-Executive I = Independent # = Directorships in Indian public limited companies only. ~ = Committee means only e Audit Committee, Shareholders' Grievance Committee and Remuneration Committee. During e year under e report, e Board met five times i.e. on , , , and The maximum time gap between any two meetings was not more an ree calendar mons. As per information available wi e Company, none of e Directors is a member of more an ten committees and none acts as chairman in more an five committees across all companies in which he is a director. (b) Information about persons who are being appointed / re-appointed as Directors. NAME OF DIRECTOR, BRIEF RESUME, FIELD OF SPECIALISATION AND DIRECTORSHIP / COMMITTEE MEMBERSHIP HELD BY HIM : (i) Shri Navneet Garg (35 years) is a Mechanical Engineer wi more an 12 years experience in Production of Synetic Leaer and management. He is not a Director or Committee Member of any oer Company. (ii) Shri Jai Kishan Garg ( 65 years) years is a Mechanical Engineer wi more an 40 years experience in Production of Synetic Leaer and management function. Besides also being a Director of Gesco Automation Ltd, he does not hold any Directorship or Committee Membership of any oer Company. (iii) Shri Om Prakash Garg (62 years) is a Mechanical Engineer. Prior to joining is Company as Executive Director in e year 1993, he has held management positions in Indurial Development Bank of India. He has more an 30 years experience in project finance and indurial management/commerce. He is a member of Shareholders' Grievance Committee. He is also a Director of Modern Electro-Power Pvt Ltd. He does not hold any oer Directorships or Committee Memberships. (iv) Dr. Shiv Kumar Khandelwal (82 years) is a Ph.D in linguiics. Prior to joining e Company as Director in e year 1994, he was Principal of Hindu College, Sonipat. His field of specialization is general management. He is a member of Shareholders' Grievance Committee, Audit Committee and Remuneration Committee. He is also a Director of Syem Packagings Pvt Ltd. He does not hold any oer Directorships or Committee Memberships The Board is of e view at e Company will immensely benefit from eir va experience. The Board, erefore, recommends ese reappointments as Directors. Shri Navneet Garg, Shri Om Prakash Garg and Dr. Shiv Kumar Khandelwal are liable to retire by rotation of Directors. 3. AUDIT COMMITTEE The Audit Committee conituted by e Board of Directors consis of ree independent directors namely Dr. K.C. Varshney (Chairman), Shri Kuldeep Singal and Dr. S.K. Khandelwal which conitution is in accordance wi Section 292A of e Companies Act, 1956 and e Liing Agreement. Dr. K.C. Varshney has va experience in Corporate Finance. The Audit Committee has powers similar to ose ated in Section 292A and Liing Agreement. Statutory Auditors and executives responsible for finance and accounts are permanent invitees to e Audit Committee Meetings. Shri S.K. Verma, Company Secretary is Secretary of e Audit Committee. Silver Jubilee During e Financial under Report, e Audit Committee held its meetings on , , and REMUNERATION COMMITTEE The Remuneration Committee conituted by e Board of Directors comprises of ree independent directors namely Dr. K.C. Varshney (Chairman), Shri Kuldeep Singal and Dr. S.K. Khandelwal which conitution is in accordance wi law/liing agreement. Shri S.K. Verma, Company Secretary is e Secretary of e is Committee. During e year under report, e Remuneration Committee held one meeting on The remuneration paid to Directors during e year under review is as under : Name Designation Salary ( `) Perks ( `) Shri J.K. Garg Chairman & Mg. Director 12,00,000 Shri O.P. Garg Executive Director 3,40,000 72,000 Shri Manish Garg Whole Time Director 7,38,092 61,908 Shri Ramnik Garg Whole Time Director 7,37,576 62,424 Shri Navneet Garg Whole Time Director 6,00,000 61,913 11

12 The entire remuneration is fixed. There are no performance linked incentives payable to any of e Directors. No Stock Option Scheme is operational in e Company. As regards remuneration to non-executive Directors, besides payment of sitting fees for Board/Committee Meeting attended by em, no oer remuneration is being paid to em. Accordingly, Sitting Fees paid to non-executive Directors for attending Board Meetings and Committee Meetings are as follows : Dr S. K. Khandelwal `,000 Dr K.C. Varshney `,000 Dr. Ashok Mittal ` 20,000 Shri Kuldeep Singal `,000 Shri K.L. Khetarpaul `, SHAREHOLDERS'/INVESTORS' GRIEVANCE COMMITTEE Dr. S.K. Khandelwal is e Chairman of is Committee. Oer members of e Committee are Shri O.P. Garg, Executive Director and Shri S.K. Verma, Company Secretary. The functions of e Committee are overseeing redressal of complaints received from shareholders. Shri S.K. Verma, Company Secretary is e Compliance Officer under e Liing Agreement wi Mumbai Stock Exchange. During e year under report, e company received only two complaints, which were satisfactorily resolved. No complaint was pending as on 31 March, No reques for transfer / transmission / dematerialisation of shares were pending as on 31 March, 2011, except ose, if any, which were required to be disposed by e Company wiin irty days of receipt and is period of irty days had not expired by 31 March, 2011 or which have been received late. These reques, were subsequently approved/dealt wi by e Company. 6. GENERAL BODY MEETINGS The la ree Annual General Meetings of e Company were held as follows : Date Time No. of Special Resolutions passed AM AM AM 0 All e above Meetings were held at e Regiered Office & Works of e Company at 43/5, Bahalgarh Road, Sonipat. No poal ballots were involved. 7. DISCLOSURES (a) Disclosures on materially significant related party transactions i.e. transactions of e company of material nature, wi its promoters, e directors or e management, eir subsidiaries or relatives, etc at may have potential conflict wi e interes of e company at large : None of e transactions wi any of e related parties were in conflict wi e interes of e Company. (b) Details of non-compliance by e company, penalties, rictures imposed on e company by Stock Exchanges or SEBI or any atutory auority, on any matters related to capital markets, during e la ree years. There were no such inances. Silver Jubilee 8. MEANS OF COMMUNICATION (a) The company has published its quarterly results in e Business Standard/Financial Express. (b) Management Discussion and Analysis forms part of e annual report which is poed to e shareholders of e Company. 9. GENERAL SHAREHOLDER INFORMATION 9.1 Annual General Meeting : - Date and Time 30 September, 2011 at 10:00 AM - Venue Regiered Office of e Company at : 43/5, Bahalgarh Road, Sonipat, Haryana 9.2 Financial Calendar Annual General Meeting : 30 September, 2011 Results for Quarter ending Published during - 30 June, 2010 (unaudited) Fir Half of Aug, Sept, 2009 (unaudited) Second Half of Oct, Dec, 2010 (unaudited) Fir Half of Feb, March, 2011 (unaudited) Second half of Apr, Book Closure Date: to (bo days inclusive) 9.4 Dividend Payment date : 9.5 Liing of Equity Shares : Mumbai Stock Exchange* 9.6 Stock Code : (a) Trading Symbol at : Mumbai Stock Exchange : (b) Demat ISIN Nos in NSDL and CDSL : INE711C

13 * s back, e company had applied for voluntary deliing of its shares from Kolkata Stock Exchange (KSE). KSE has remained unresponsive inspite of reminders and ere has also not been any trading in company's shares at KSE for about a decade now. Annual Liing fees has been paid upto date to Mumbai Stock Exchange only, where Company's shares continue to be lied and traded. 9.7 STOCK MARKET DATA SHARE PRICE PERFORMANCE IN COMPARISON TO BROAD BASED INDICES Stock Market data in respect of equity shares (of ` 10 each fully paid up) of e Company i.e. high/low/closing price, number of shares traded and number of trades during e financial year on e Mumbai Stock Exchange was as under: Mon Open High Low Close No. of No. of Total Turnover * Spread Price Price Price Price Shares Trades ( `) ( `) H-L C-O Apr , ,73, May , ,03, Jun , ,92, Jul , ,79, Aug ,84, ,15, Sep ,85,933 1,098 43,27, Oct ,46,518 1,012 37,99, Nov ,39, ,40, Dec , ,71, Jan , ,77, Feb , ,04, Mar , ,18, * Spread H-L : High-Low; C-O : Close-Open Note : The above figures have been obtained from "Archives" Section of e official website of e Mumbai Stock Exchange. The shares of e company have shown no or very little sensitivity to share price index. 9.8 REGISTRAR AND TRANSFER AGENTS AND SHARE TRANSFER SYSTEM Pursuant to SEBI directions regarding handling of Share Transfer/demat work at one point, e Company has appointed M/s Alankit Assignments Ltd as e Regirars, whose complete address is given elsewhere in is Report. 9.9 DISTRIBUTION OF SHAREHOLDING AS ON 31ST March, 2011 (Equity shares of face value of ` 10 each, fully paid up) Category of Share Holders Number of Total Number of Total Shareholding Shares Pledged or Share Number of Shares Held in as a Percentage of oerwise Holders Shares Dematerialized total number of encumbered form shares No. % Indian Promoters (Individuals / HUF) Mutual Funds/UTI Bodies Corporate i. Individual shareholders holding nominal share capital up to ` 1 Lac ii. Individual shareholders holding nominal share capital in excess of ` 1 Lac NRIs TOTAL Silver Jubilee 9.10 DEMATERIALISATION OF SHARES AND LIQUIDITY 84.94% of e paid up share capital of e Company is represented in dematerialised form as on 31 March, OUTSTANDING GDRS/ADRS/WARRANTS OR ANY CONVERTIBLE INSTRUMENTS, CONVERSION DATE AND LIKELY IMPACT ON EQUITY : The Company does not have any such outanding inruments : PLANT LOCATION The only plant of e Company is located at 43/5, Bahalgarh Road, (Village Jat Joshi), Dit. Sonipat, Haryana ADDRESS FOR SHAREHOLDER CORRESPONDENCE Consequent upon appointment of M/s Alankit Assignments Ltd as Regirars and Share Transfer Agents wi effect from 31 January, 2003, all reques for transfer/transmission/transposition of names/issue of duplicate share certificates/demat/ remat/change of address and oer work related to shareholder service/correspondence should be addressed to : Alankit Assignments Ltd (Unit : Jasch Induries Ltd) 2E/21, Jhandewalan Extension, New Delhi In e unlikely event of a long pending unattended reque, shareholders may write to : The Company Secretary, Jasch Induries Ltd, 43/5, Bahalgarh Road, Sonipat , Haryana. His contact phone number is : address is skverma@jasch.biz Website : DECLARATION BY CEO OF THE COMPANY ON CODE OF CONDUCT In terms of Clause 49(D), of e Liing Agreement e Managing Director declares and certifies at all e Board Members and senior management personnel have affirmed compliance wi e Code of Conduct laid down by e Board of Directors of e Company CEO/CFO Certification In terms of Clause 49(V), e Managing Director and e Executive Director have given e required certificate to e Board of Directors. Sonepat For Jasch Induries Ltd. 18 July, 2011 J. K. Garg Chairman & Managing Director 13