SHREE GANESH ELASTOPLAST LIMITED. 18 TH AUDITED ANNUAL REPORT FOR THE YEAR COMPANY REGISTRATION NO: CIN NO: L25200GJ1994PLC021666

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1 SHREE GANESH ELASTOPLAST LIMITED 18 TH AUDITED ANNUAL REPORT FOR THE YEAR COMPANY REGISTRATION NO: CIN NO: L25200GJ1994PLC SHREE GANESH ELASTOPLAST LIMITED. Regd.Office: Plot No. 138/A, Sarkhej Bavla Road, Village: Vasna Chacharvadi, Taluaka: Sanand, Dist: Ahmedabad:

2 EIGHTEENTH ANNUAL GENERAL MEETING PROGRAMME DATE : 8 TH SEPTEMBER, 2012 DAY TIME VENUE : SATURDAY : A.M. : Plot No. 138/A, Sarkhej Bavla Road, Village: Vasna Chacharvadi, Taluka: Sanand, Dist: Ahmedabad: NOTE TO SHAREHOLDERS: As a measure of economy, copies of the Annual Report will not be distributed at the Annual General Meeting. Shareholders are requested to kindly bring their copies to the meeting. CONTENTS: 1) Board of Directors and Other Information. 2) Notice And Explanatory Statement. 3) Directors' Report and Corporate Governance Report 4) Auditors' Report. 5) Balance Sheet. 6) Profit & Loss Account. 7) Schedules to Balance sheet & Profit Loss Account 8) Notes to the Accounts. 9) Balance Sheet Abstract & Company's General Business Profile. 10) Cash Flow Statement pursuant to Clause 32 of the Listing Agreement 11) Auditors Report to Cash Flow Statement. 12) Attendance Sheet & Proxy Form.

3 BOARD OF DIRECTORS Shri Nitin. H. Mehta. Shri Harshadrai. T. Mehta Shri Mihir R. Shah Shri Mayukh J. Pandya Shri Bharatkmar V Mashruwala Shri Harishbhai Ratilal Mehta. Chairman And Director Director Director Director Director Additional Director COMPANY LAW CONSULTANT M/s Kamlesh M. Shah & Co., Company Secretaries, 801- A, Mahalay Building, Opp. Hotel President, Off. C.G. Road, Ahmedabad BANKERS OF THE COMPANY Central Bank of India, Ahmedabad Stock Exchange Branch, Ahmedabad. STATUTORY AUDITORS M/S Sunil Dad & Co., 1016, Anand Mangal III, Near Apollo Citi Centre, Near Parimal Cross Roads, Ellisbridge, Ahmedabad: LISTING AT AHMEDABAD MUMBAI The Stock Exchange Ahmedabad The Stock Exchange Mumbai Kamdhenu Complex, 25th Floor, P.J. Towers, Nr. Panjarapole, Dalal Street, Fort, Ambawadi, Ahmedabad Mumbai REGISTERED OFFICE AND FACTORY Plot No 138/A, Sarkhej Bavla Road, Village: Vasna Chacharvadi, Taluka: Sanand, Dist: Ahmedabad: COMPLIANCE OFFICER Shri Nitin. H. Mehta, Chaiman & Director.

4 NOTICE TO THE MEMBERS. Notice is hereby given that 18 th Annual General Meeting of the Members of SHREE GANESH ELASTOPLAST LIMITED will be held on Saturday the 8 th September, 2012, at 11:00 AM at the Registered Office of the Company situated at Plot No. 138/A, Sarkhej-Bavla Road, Village: Vasna-Chacharwadi, Tal. Sanand, Dist. Ahmedabad to transact the following business: ORDINARY BUSINESS: 1. To receive, consider, Approve and adopt the Audited Balance Sheet of the Company as on 31 st March 2012, Profit & Loss Account for the year ended on that date, and the report of the Auditors thereon. 2. To Retire by Rotation Mr. HARSHADLAL TRAMBAKLAL MEHTA who retires by rotation at this Annual General Meeting and not offering for reappointment as a Director. 3. To Retire by Rotation Mr. NITIN HARSHADRAI MEHTA who retires by rotation at this Annual General Meeting and being eligible offers himself for reappointment. 4. To appoint Auditors M/s. Sunil Dad & Co., Chartered Accountants, for the year and to hold the office as such from the date of conclusion of this Annual General Meeting until the conclusion of the next Annual General Meeting and to fix their remuneration. SPECIAL BUSINESS: 5. To Consider and if thought fit to pass with or without modification following resolution as an ORDINARY RESOLUTION. RESOLVED THAT pursuant to provisions of section 260 of the Companies Act 1956 read with relevant provisions of the Companies Act 1956, Mr. HARISHBHAI RATILAL MEHTA, who was appointed by the Board as an Additional Director and who holds the office as such only up to the date of this Annual General Meeting, however he is eligible for appointment as Director and the company has received requests in writing along with requisite deposits from some of the members proposing his candidature as Director, and as Mr. HARISHBHAI RATILAL MEHTA has given his consent to act as Director of the Company if so appointed at the Annual General Meeting be and is hereby appointed as Director of the Company whose term of office shall be liable to determination for retirement by rotation.

5 6. To Consider and if thought fit to pass with or without modification following Resolution as SPECIAL RESOLUTION. To change the main object clause of the Memorandum of Association of the Company: RESOLVED THAT pursuant to provisions of Section 17 read with section 192A and all other applicable provisions if any of the Companies Act 1956 and also subject to approval of the members of the company in General meeting or by way of postal ballot and approval of the Registrar of Companies or such other authorities if any applicable, the present main objects clause of the Memorandum of Association, of the Company be and is hereby altered, amended, and modified by addition of the following new main object clauses: OBJECT CLAUSE NO: III (A) (2) To carry on business of buying, purchasing, importing, sorting, processing, manufacturing, packing, repacking, marketing, exporting, dealing in, to act as agents, commission agents, consignment agents, concessionaries, authorized sole selling or sole buying agents for all types, kinds, description, of agro products, food products, edible goods, vegetables, fruits, dry fruits, herbs, spices, edible oils of all kinds, ghee, vanaspati oil, raw mixed ready to cook food, finished packed ready eat food, and all kinds of agro products and food products in all its types, forms, description including to purchase, store, distribute the same through establishment of cold chain system through out the country and anywhere in the world. OBJECT CLAUSE NO. III (A) (3) To Carry on the business of trading in ready market as also in the forward market at any of the recognized forward trading markets through its authorized brokers or agents in all types, kinds, description of agro and food products or commodities for the purpose of sole trading, sole buying purpose or sole selling purpose or to do hedging in food, Agro & Commodity in any of the recognized commodity markets or in any agro market yards. OBJECT CLAUSE NO. III (A) (4) To carry on the business of generation and manufacture of Electricity, power, energy by using any of the non conventional sources of manufacturing such as Solar, Wind, Bio Mass, Gas, or any other new source of manufacture of electricity, power or energy and to enter in to the business of marketing, selling, transmission of electricity or power business and including to enter in to Power purchase agreement with any of the State and Central Electricity Boards and/or public/private power generation and distribution company or any nodal company or agency specified by the Government in this regard.

6 ALSO RESOLVED THAT Mr. Nitin H. Mehta, Chairman and Director of the Company be and is hereby authorized to get the new memorandum of Association printed, file the new objects clause in respective forms along with a copy of this resolution and explanatory statement with the office of the Registrar of Companies and to obtain their approval to the proposed changes as required by law and also authorized to do all such other acts, things, deeds, matters as may be required or necessary for the purpose of giving effect to this resolution. 7. To Consider and if thought fit to pass with or without Modification following Resolution as SPECIAL RESOLUTION. shift the Registered Office of the Company from Taluka: Sanand Dist: Ahmedabad Ahmedabad City, Gujarat. to RESOLVED THAT pursuant to provisions of section 146 read with section 192A and all other applicable provisions if any of the Companies Act 1956, as also subject to approval by the members of the Company by way of passing of the Resolution in General meeting and also by Postal Ballot means, as also subject to approval of the Registrar of Companies if any, the Registered Office of the Company be and is hereby shifted FROM: 138/A, Vasna Chacharwadi, Village: Vasna, Taluka: Sanand, Dist: Ahmedabad TO : 119, Gr. Floor, Kamdhenu Complex, Opp: Sahajanand College, Polytechnic, Ahmedabad: , Gujarat State, India.. With effect from the date of passing of this Resolution in General Meeting. RESOLVED FURTHER THAT all the statutory Registers, records, books of Accounts and other such papers of the Company be and is hereby transferred to and shifted to the new registered office within the state with immediate effect. RESOLVED FURTHER THAT Mr. Nitin H. Mehta, Director be and is hereby authorized to intimate about this change in prescribed form No. 18 and also in form no. 23 to the Registrar of Companies, and file the said form under his digital signature and also to intimate to all concerned authorities in time By Order of the Board of Directors Shree Ganesh Elastoplast Limited Date: 16 th July, 2012 Place: Ahmedabad Sd/- Nitin H. Mehta Chairman

7 NOTES: a) A member entitled to attend and vote is entitled to appoint one or more proxies to attend the meeting and vote instead of him and a proxy need not be a Member. The instrument appointing a proxy shall be deposited at the Registered Office of the Company not later than 48 hours before the time fixed for holding the meeting. b) Members are requested to advise immediately any change in their address to the company. c) As a measure of economy, copies of the Annual Report will not be distributed at the Annual general Meeting, therefore, members are requested to bring their copies of Annual Report to the meeting. d) The Register of Members and the Share Transfer Books of the Company will remain closed from 04/09/2012 to 08/09/2012 e) Members are requested to send their queries, if any, to the Company at least 7 days before the date of the Meeting so as to enable the management to keep relevant information ready. f) Item No. 6 and 7 of the Notice being Special Resolutions to be passed Under section 17 for change of Main Objects clause and a Special Resolution to be passed under section 146 for shifting of Registered Office of the Company is required to be passed through Postal Ballot as per provisions of the Listing Agreement and also the Companies (Passing of Resolution by means of Postal Ballot) Rules. g) Copy of Postal Ballot Form is attached herewith. All the postal ballot forms duly filled in properly and signed as per as specimen signature of the shareholders be send in self stamped pre paid envelop at the Registered Office of the Company so as to reach on or before 7 th September h) The Company has appointed M/s. Kamlesh M Shah & Co., Practicing Company Secretaries, to act as Independent Scrutinizers to ensure that all the procedure for postal ballot is conducted in fair and transparent manner. They will submit their report to the Chairman at 5.30 P.M. on 7 th September i) The result on Postal Ballot will be declared by the Chairman at the time of Annual General Meeting. j) Members are requested to carefully read all the instructions printed over leaf of the Postal Ballot form and fill up the form properly and must completely filled up. All incomplete forms will be treated as invalid votes.

8 AN EXPLANATORY STATEMENT PURSUANT TO PROVISIONS OF SECTION 173 OF THE COMPANIES ACT 1956 TO THE BUSINESS MENTIONED AS SPECIAL BUSINESS IN THE NOTICE CONVENING THE ANN 18 TH ANNUAL GENERAL MEETING OF THE COMPANY. ITEM NO. 5: APPOINTMENT OF MR. HARISHBHAI R MEHTA AS DIRECTOR OF THE COMPANY: The Board of Directors of the Company has in their meeting held on 16 th July 2012 appointed Mr. Harishbhai R Mehta as Additional Director. Mr. Harishbhai Mehta is a Retired Bank Manager. He has more than 30 years of experience in Banking operations, loan and working capital limit sanctioning and monitoring by industry, he has general administrative experience also. Mr. Harishbhai R Mehta will be acting as an Independent Non Executive Director on the Board. He will also be appointed in the Audit Committee of the Board so as to ensure proper financial planning, execution and monitoring of Finance, Accounts, Tax Matters of the Company. His experience as Retired Bankers will benefit the company in the long run as well as also ensure proper transparent corporate governance. Mr. Harisbhai R Mehta s brief particulars are given elsewhere in this notice and forming part of this explanatory statement. As per provisions of the Companies Act, Mr. Harishbhai Mehta holds the post of Director only up to the date of ensuing Annual General Meeting. However, being eligible for appointment and as some members have proposed his candidature for appointment as Director it is proposed to pass the Resolution. Your directors recommend to pass the same. Except Mr. Harishbhai Mehta, no other director may be deemed to be concerned or interested in the proposed Resolution. ITEM NO 6: AMENDMENT IN THE MAIN OBJECTS CLAUSE OF THE COMPANY BY ADDITION OF NEW BUSINESS ACTIVITIES: The Company intends to expand its business by exploring new sectors. The rubber manufacturing business is now not as remunerative as it was before. Looking to the proposed business opportunity available which is also lucrative business at the same time it is proposed to alter the Memorandum of Association of the Company suitably to enable the company to commence the business of manufacture, market, export of food products, agro products. To trade in forward market and do hedging in Agro & Commodity market. To enter into power purchase agreement with any of the State and Central Electricity Boards and/or public/private power generation and distribution company. To manufacture & generate power by Wind, Biomass, Solar and any other non conventional means. The provisions of section 17 requires the approval of the members in the General Meeting to incorporate such changes in the objects clause of the Memorandum of Association hence the resolution is proposed. Further as the Company s shares are listed on the stock Exchange, provisions of section 192A also requires to pass this resolution by means of a postal ballot from shareholders. Your directors recommend passing the same as special resolution with requisite majority.

9 As per instructions given in the postal ballot form attached with this notice, all postal ballot forms duly filled in and signed should reach the Registered Office of the Company on or before 7 th September The Company has appointed Mr. Kamlesh M Shah, Company secretary in whole time Practice to act as the Scrutinizer to ensure system of postal ballot in free and transparent manner. All the shareholders are requested to read the instructions carefully before exercising their right to vote by postal means. None of the directors of the company may be deemed to be concerned or interested in the proposed resolution. ITEM NO.7: SHIFTING OF THE REGISTERED OFFICE OF THE COMPANY IN THE CITY OF AHMEDABAD. In Gujarat State, the City of Ahmedabad has become a main Business Hub. It is a finance capital of the Gujarat State. Further the City is also adjacent and nearby the state political capital Gandhinagar where all Government offices and secretariat officers are sitting and located. It is most convenient to deal with all government departments in a day to day basis and shifting of the Registered Office will also reduce the administrative expenses for the Company. Further, the City of Ahmedabad is well connected by Road, Rail and Air with the entire India. Many international flights are also coming to Ahmedabad Air Port. There are many star hotels located in the city of Ahmedabad where the company can make necessary arrangements for stay and arrange business meetings with its international cliental. Considering all the above reasons and long term business view it is decided by the Board to shift the Registered Office of the Company from the current plant location in Village: Vasna, Taluka: Sanand, Dist: Ahmedabad to the City of Ahmedabad. This shifting of the Registered office from One Village or city or town to another city, village, town requires approval of the shareholders in the form of a Special Resolution. Further as the company s shares are listed on the stock exchanges, as per provisions of section 192A of the Act, the company is further required to offer postal ballot facilities to its shareholders. Your directors have appointed Mr. Kamlesh. M. Shah, a Practicing Company secretary as the scrutinizer to ensure the work of postal ballot is completed in a proper and transparent manner. The shareholders are required to send their postal ballot at the Registered Office of the Company in a self stamped envelope duly signed so as to reach the registered office of the Company before 5.00 P.m. of 7 th September The result of the Postal ballot will be declared by the Chairman in the meeting at the time of taking up the business for consideration and voting. None of the Director may be deemed to be concerned or interested in the proposed resolution. Date: Place: Ahmedabad By Order of the Board of Directors Shree Ganesh Elastoplast Limited Sd/- Nitin H. Mehta Chairman

10 INFORMATION ABOUT THE DIRECTORS WHO ARE PROPOSED TO BE APPOINTED/ RE-APPOINTED AT THE ANNUAL GENERAL MEETING AS PER CLAUSE 49 OF THE LISTING AGREEMENT. Particulars Nitin.Harshadrai Mehta. Harishbhai Ratilal Mehta. Director Identification Number Date of Birth. 04/01/ /05/1945 Age Educational Qualification. B.COM B.A, B.COM, LLB Experience (No. of Years) 20 YEARS 30 YEARS Business field in which Experience. RUBBER MANUFACTURING BANKING Date of Appointment as Director in the Company. 28/03/ /07/2012 Dirctorship held in any other Company. MAGNUS RUBBER INDUSTRIES LTD (UNDER LIQUIDATION) N.A. Member of any Committees of the Directors in the Company. AUDIT COMMITTEE, INVESTOR GRIEVANCE COMMITTEE N.A. Member of any committees of the Directors in other Companies with names of the Company. N.A. N.A. Member of any Trade Association/ Charitable Organization/ NGOs etc. N.A. N.A.

11 DIRECTORS REPORT. The Members, Your Directors are presenting herewith 18 th Annual Report along with the Audited Accounts for the year ended 31 st March, FINANCIAL RESULTS: During the year, the company was not engaged in any commercial business activities. Hence there was no operational income. The Company has also not earned any other income whether by sale of its old stocks or interest or sale of scrap etc. The Company has during the year incurred administrative expenditure of Rs. 22,48,018/- (Previous year was of Rs. 10,000/-). After making provision for depreciation of Rs. 6,20,617 (Previous year was of Rs. 6,20,617/-), the company incurred a net loss of Rs. 28,72,937/- (Previous year loss of Rs. 6,30,617/-). After making necessary adjustments for prior period expenses and exceptional and extra ordinary items and taxes, a Net Loss of Rs. 30,83,888/- (Previous year of Rs. 6,30,617/-) is carried to Balance sheet. OPERATIONS: During the year, under review, the company could not carry-out any manufacturing activity due to its plant has been closed for long time and is not in a position for running. It is also deteriorating and becoming obsolete day by day. The current condition of the plant and machineries are rusting day by day. DIVIDEND: In the view of carried forward losses, your directors do not recommend any dividend for the year under review. TRANSFER OF UNPAID/ UNCLAIMED DIVIDEND OR OTHER DUES: The Company does not have any amount lying with it as Unpaid/ Unclaimed Dividend which is required to be transferred to the General Revenue Account of Government of India as per provisions of Section 205C of the Act. The Company does not have any outstanding liabilities on account of Interest or Principal of matured / accrued and unpaid/ unclaimed amount of Deposits, Debentures or other such amounts. CAPITAL STRUCTURE: There was no change in the Authorized, issued, subscribed or paid up share capital of the company during the year under review. BUY BACK OF SHARES: The Company has not made any Buy back of its equity shares during the year as per provisions of section 77, 77A or other provisions of the Act. The board further report that no such liabilities on account of buy back of shares if any declared in the past are outstanding.

12 DEMATERIALIZATION OF SHARES: The Company has now entered in to Triparty Agreements with National Securities Depository Limited and also with the Central Depository Services Limited. The ISIN allotted to your company is INE 400 N Your Company s shares are now available for dematerialization with both the depositories. Your directors recommend to dematerialize the shareholding by every shareholders as the trading in shares on stock exchange is compulsorily required to be done in demat mode only. STATUS ON LISTING AND TRADING IN SHARES OF THE COMPANY. Your Company has now made all the quarterly, half yearly, yearly compliances with the stock exchanges. The website of the Company is now fully operational. All the information relating to the investors interest as well as all information as per requirements of stock exchange and listing agreement are available on the company s website. The Company has paid annual listing fees of the Bombay Stock Exchange Limited up to and including the financial year The Trading in shares of the company are now resumed on the BSE Trading terminal. The shares of your company are now freely tradable in demat mode. All investors can now take benefit of sale/ purchase of shares in the company as well as new prospective investors can also make investments in shares of the company through any of the authorized or recognized broker of the BSE. DISPOSAL OF OLD OBSOLATE MACHINERIES, FACTORY BUILDINGS AND OTHER FIXED ASSETS; During the year, the Company had proposed and the shareholders have by passing a Special Resolution by means of Postal Ballot system as per provisions of section 192A of the Companies Act, authorized The board of Directors of the Company to sale, dispose off the whole or substantially the whole of the undertaking to manufacture the rubber and plastic parts currently located at Village: Vasna, Vasna Chacharvadi, Taluak: Sanand, Dist: Ahmedabad to appropriate prospective parties / clients at best available resale prices as the entire factory building and plant and machineries or its parts are now in closed and rusting conditions. The Board of Directors have appointed now reputed government approved valuers to value the assets on as is where is basis. After receipt of their report, the Board will do the further process of selling the same. FUTURE BUSINESS PLANS OF THE COMPANY: Your Directors have decided to close its present business operations of rubber and plastic parts manufacturing unit. As the said plant is in closed conditions since long time and at present in rusting conditions with the approval now obtained from the shareholders by means of postal ballot, your directors have decided to sale or disposs off the whole or substantially the whole of the undertaking of this unit. The factory buildings will be suitably modified/ reconstructed and the said land will be utilized for new business activities such as Agro food products procurement, processing, packing, repacking etc. As your company s current plant is located near Bavla, Dholka, Sanand, Bhal Pradesh of Gujarat which are largest growers of Rice, Wheat and Grams (Chana), there are good potentiality to establish an Agro and food processing industry in this area. Further, the agro and food processing industry has bright future looking to

13 the increasing population of the country as well the changing life style of the people in the Gujarat state due to rapid industrialization and upgradation in the life style of the people of Gujarat. Considering the above, it is proposed to change the Main objects clause of the Memorandum of Association of the Company. Your directors recommend to pass the resolution with requisite majority. REVALUATION OF THE FIXED ASSETS OF THE COMPANY: The management of the company has thought fit and proper to revalue the fixed assets of the Company considering the steep rise in the prices of the real estate, land, buildings etc. in the state of Gujarat as well as the nearby areas. This revaluation is made only to the extent of the deemed market price (Jantri price), the minimum upset value of land fixed by the Government of Gujarat for the land located in the area. This is done to represent the real marketable value of assets and true and fair value of the assets owned by the company in the financial statements. This true and fair representation of the assets and other business of the company will also help the company in raising required financial resources for the future business activities of the company. CORPORATE GOVERNANCE: Report on Corporate Governance and management discussion and analysis as required vide Clause-49 of the Listing Agreement along with Management Discussion and Analyses report, Auditors Certificate are annexed to this report. DEPOSITS: The company has not invited or accepted any Deposit, Loans or finance from the public in violation of section 58A or any rules made there under. DIRECTORS: Mr. Harshadlal Trambaklal Mehta has expressed his unwillingness to continue as Director of the Company. Mr. Harshadlal T Mehta, retires by rotation at the ensuing Annual General Meeting. Accordingly, it is proposed not to reappoint him as Director at the ensuing Annual General Meeting. The Board has also decided that no other person be appointed as Director in his place. Mr. Nitin Harshadrai Mehta also retires by rotation at the ensuing Annual General meeting. Your directors recommend to appoint him by passing requisite resolutions as proposed in the Notice. Mr. Harish Ratilal Mehta, was appointed as Additional Director by the Board on 16 th July He holds office as such only up to the date of ensuing Annual General Meeting. However the company has received notices from some members along with requisite deposit proposing his candidature as director. Accordingly a resolution proposing to appoint him as regular director of the company is proposed to be passed. Your directors recommend to pass the same with requisite majority, DIRECTORS RESPONSIBILITY STATEMENT: Pursuant to the provisions of Section 217(AA) of the Companies Act, 1956, your Directors declare that:

14 i) In preparation of the annual accounts, as far as possible and except to the extent if any accounting standards mentioned by the auditors in their report as not complied with, all other applicable accounting standards had been followed along with proper explanation relating to material departures; ii) The Directors had selected such accounting policies and applied them consistently and made judgments and estimates that are responsible 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 after the profit or loss of the company for that period; iii) The Directors have taken proper and sufficient care for the maintenance of 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 Directors had prepared the annual accounts on a going concern basis. PARTICULARS AS REQUIRED UNDER SECTION 217(1)(E): a) Conservation of Energy: -NIL- (As the company is not in operations throughout the year) b) Technology Absorption: In the view of no business activity, the question of technology absorption does not arise. c) There are no foreign exchange earnings and outgo during the year. PARTICULARS OF EMPLOYEES: There are no employees in the company drawing salary/ remuneration in excess of the limits specified in the rules, hence, the statement as required under Section 217(2A) of the Companies Act, 1956 read with the Companies (Particulars of Employees) Rules, 1975 has not been furnished. AUDITORS: M/s Sunil Dad & Co., Chartered Accountants, Ahmedabad retires at the ensuing Annual General Meeting and the Company has received their consent under provisions of Section 224(1B) of the Companies Act, You are requested to appoint them as auditors for the year AUDITORS REPORT AND OBSERVATION: The various observations made by the auditors in their report dated 16/07/2012 are self explanatory and properly explained in Notes forming part of the accounts attached herewith. However, full explanation on each of the observation of the auditors as under: (1) NON DISCLOSURE OF NAME OF PARTIES AND THEIR DUES BELONGING TO SMALL SCALE SECTOR: At the year end, the company has total outstanding Sundry creditors of Rs. 5,22,336/- only. Whereas total creditors for expenditure is Rs. 1,05,555/-. As the Company is not in operations since last 5 years

15 or more and no claims from any sundry creditors are received during the year, in absence of proper supporting proofs from creditors it is difficult for the management to segregate the dues belonging to SSI Creditors. Hence, the information is not given in the Accounts separately. (2) No provision has been made for doubtful debts / loans & advances aggregating to Rs. 1,89,60,309/- The Management of the Company is in process of recovery of this outstanding amount. The procedure is also followed by legal notices to each of the parties and the company is also in talks with each of the parties in a business like manner for its total recovery. There are bright hopes and changes for their recovery hence, no provision has been made. (3) Acquisition of shares in earlier year of a company being sick company under the same management for Rs. 28,30,459/-. These shares of group company M/s. Magnus Rubber Limited is acquired long back even before the said company had become sick. During the year there was no change in investment. No fresh investment has been made by the Board during the current year. The trading in shares of M/s. Magnus Rubber Limited has been suspended by the Stock exchange hence, it is not quoted. The said Company has gone In to liquidation and is at present with the Official Liquidator for winding up process. The company will make the provision for this amount by writing off the investment now in the next financial year. (4)Non provision of obsolete stock of Rs. 12,30,000/- as well as diminution in value of shares Rs. 42,46,459/-. The Company is in process of selling/ disposal off of the stock lying at its factory premises. It has also invited quotations, tenders from various agencies. The stock will be disposed off in one lump sum go. After considering the net realizable value of stock being sold in auction, necessary provision for its loss will be made in the books of account at the appropriate time. In fact, the Company has passed postal ballot resolution under section 293(1)(a) for sale/ disposs off of the old obsolete parts, machineries and entire unit as a whole which has not become obsolete and is now in rusting conditions. The board is now empowered to do the process. The accounting of this transaction will be completed in the next financial year. (5) NON PROVISION OF UNDISPUTED TAX LIABILITIES: The Amount of undisputed tax liabilities shown in the Auditors report are relating to previous years vary old in nature. This liability has been calculated by the Auditors as Sales tax amount and CST amount of tax difference due to non receipt of C Forms from various parties. This is a very old matter. The Company has also not received any notices for recovery of the same from the department/ authorities or no such papers are traceable. However, the auditors have continued with to put their remark in their report.

16 (6) ACCOUNTING MADE ON GOING CONCERN BASIS: The Company is still incurring expenditure in the form of administrative expenses. The Company s shares are at present listed on stock exchanges. The Company has during the year paid all dues of stock exchanges. The Company has also paid financial penalty if any imposed by BSE for removal of suspension from Trading. The Company has appointed full fledged Registrar and Share Transfer Agent. The Company has signed tripartite agreements with NSDL and CDSL and has paid their fees. Thus administratively the company is operational. The Company has passed resolution under section 293(1)(a) authorizing the Board to disposes off all old and obsolete plant, machineries, and other assets to the best of their value. The Company has during the year revalued its fixed assets (Land) to represent the true and fair value of its assets. The company proposes to revive its entire business operations by commencing of the new profitable business activities. Necessary resolutions are proposed to be passed in the General meeting authorizing changes in the objects clauses of memorandum of Association of the Company. Considering all the efforts put in by the management of the company for the revival of entire business operations and business activities from all sides, the financial accounts of the company are prepared by the management on a going concern basis. AUDIT COMMITTEE: The Company has formed the audit committee within the organization in compliance to section 292A and also in compliance with clause 49 relating to Corporate governance as per listing agreement. The Complete details are given in corporate governance report attached herewith and forming part of this report. MATERIAL CHANGES: No material changes have taken place after the close of the financial year and up to the date of this report which may have substantial material bearings on the operations of business and finances of the company and which are required to be reported in the report of the board of directors. ACKNOWLEDGEMENT: Your directors take on record and acknowledge the devotion made and hard work put by its advisors, consultants, bankers, various government authorities, stock exchanges, professionals and all other persons, institutions associated with the company at all levels. Place: Ahmedabad Date: On behalf of the Board of Directors Of Shree Ganesh Elastoplast Limited Sd/- (Nitin. H. Mehta) Chairman

17 MANAGEMENT DISCUSSION AND ANALYSIS REPORT FORMING PART OF DIRECTORS REPORT AND ALSO A REPORT ON CORPORATE GOVERNANCE ATTACHED TO DIRECTORS REPORT. CURRENT STATUS OF THE COMPANY: The Company s factory plant and its technology are now obsolete. Due to accumulated financial losses the company is not in a position to raise funds by way borrowing from banks or financial institutions for up gradation of the technology. The current status of the financial position of the company does not warrant commencing or carrying on or continue to carry on the business activities as it will simply lead further rise in financial loss and liabilities only. Accordingly, directors have closed its plant and manufacturing activities since long time. Due this action, the plant and machineries of the Company are now not in operation, it is in closed conditions and is deteriorating and rusting day by day. FUTURE COURSE OF ACTION FOR REVIVAL: In the current scenario, the management has decided to put all its efforts in realization of Investment, Loans and current assets, sundry debtors etc. so that it has required sufficient financial resources at least to run its fixed cost expenses. The management has already discharged its employees at factory work place and has also reduced its administrative staff to reduce overall cost. Major work of accounting, books keeping and record keeping including taxation, legal etc. are being either outsourced or assigned to independent consultants on reasonable fees so that recurring expenses are reduced and no fixed cost are incurred. The fees are normally negotiated on result based and work performance based only. DISPOSAL OF EXISTING ASSETS AND COMMENCEMENT OF NEW BUSINESS ACTIVITIES POSSIBILITIES EXPLORED: Looking to current situation, the management has decided that with the consent of the members from General meeting as well as appropriate authorities, the company proposes to disposes off its current plant, machineries and other fixed assets which are obsolete and in rusting conditions. With the available sale proceeds and recovery of other current assets, the company will explore new business avenues of venture in to Manufacturing, processing, procuring, packing, re packing, storing of agro and food products, establishment and running of cold chain storage system, cold storage logistic systems for agro and food commodities, do business of trading in market yard for acquiring of agro commodities, make hedging in commodities future markets etc. business. The food processing industry has good future looking to the changing life style of people in the urban areas, establishment of mall culture, growing economic and purchasing power of people, work culture etc. This business requires low capital investment. With the starting of the new business as proposed with the requisite approvals, the management is hopeful of revival of the company and its financial position within next 5 years.

18 CAUTIONARY STATEMENTS: The statements made in the report are based upon assumptions and expectations of future events. Actual results could however differ in future. The company assumes no responsibility in respect of forward looking statements that may be amended or modified later on the basis of subsequent developments, information and also subject approvals, consents of members in AGM/ EGM and also subject approvals from various government agencies, departments, etc. Any future non compliances or non performance may occur in the event of non receipt of such approvals, consents or any other events which may occur in future beyond the control of the management or company.

19 ANNEXURE-A TO DIRECTORS REPORT REPORT ON CORPORATE GOVERNANCE. CAUTION: During the financial year and for the period from 1 st April, 2011 to 30 th April, 2012, the Company was making full compliance with the code corporate Governance as mentioned and as required by the provisions of Clause 49 of the Listing Agreement. Further the company has also now formed the Audit Committee as per requirements of Section 292A of the Companies Act W.e.f. 30 th April, 2011 the company has appointed Mr. Mihir Rameshchandra Shah, Mr. Mayukh Jadevprasad Pandya and Mr. Bharatkumar Vinodchandra Mashruwala, as Non Execute, Non Promoter, Independent Directors on the Board of Directors. However, w.e.f. 1 st May 2011, the constitution of the Board of Directors is in compliance with the requirements of code of Corporate Governance. This report gives complete information as per clause 49 of the Listing Agreement; however, during the financial year the company was in compliance with the code of corporate governance fully, hence, investors should read this report accordingly. CORPORATE PHYLOSOPHY: The Company believes that good corporate governance practices enable the Board to direct and control the affairs of the Company in an efficient manner. At the same time it is also providing transparency in all its day to day management and administration of the business and affairs of the company. Timely information to investors, creditors, institutions, bankers, general public in proper manner also provide them with an opportunity to take right decision on investment in the company whether by way of equity or by debt instrument or even by financing or by making business transactions. The various systems of control and monitoring, suggestive and advisory guidance received from non executive, independent directors improve the health of the system of administration and also put a check on the middle management. COMPANY S STRATEGY: As per provisions of the Listing Agreement clause 49 the company is required to implement and introduce the system of corporate governance within the organization and company. In compliance with the same the Company is adhering to comply with the requirements of the same by publishing the financial information and shareholder relevant information in time through the channel of stock exchange. The Company has also created and developed a full fledged operation website which disseminates all the relevant information for the benefit of investors and general public. In addition the Company has also formed within the company various committees which are in compliance with the listing agreement guidelines.

20 BOARD COMPOSITION AND ATTENDANCE OF DIRECTORS AT MEETINGS: The Company s present Board of Directors comprises of 6 Directors out of which 2 are Promoter Directors and 4 are Non Promoter independent directors. The Chairman of the Company is promoter however he is Non Executive. The Company is meeting with the criteria of having more than 50% Non Promoter, Non Relative and Independent Directors as per requirements of the clause 49 of the Listing Agreement. The Present Composition of the Board of Directors is as under: Name of Director Designation Type Executive / Non Executive Mr. Nitin. Harshadlal. Mehta Mr. Harshadlal Trambaklal Mehta Mr. Mihir Rameshchandra Shah Mr. Mayukh Jaydevprasad Pandya Mr. Bharatkumar Vinodchandra Mashruwala Mr. Harish. R. Mehta. Appointed w.e.f. 16/07/2012 Chairman and Managing Director Director Director Director Director Director 2. COMPOSITION OF VARIOUS COMMITTEES WITHIN THE ORGANISATION: (A) AUDIT COMMITTEE: The audit committee of the Board of Directors is as under: Sr. no. Name Type No. of Meeting Attended 1. Shri Nitin. H. Mehta Chairman 4 2. Shri Mihir. R. Shah Member 4 3. Shri Bharatkumar V Mashruwala Member 4 (B) FUNCTION OF AUDIT COMMITTEE: Promoter and Director. Promoter and Director Non Promoter and Director Non Promoter and Director Non Promoter and Director Non Promoter and Director No. Board Meeting Attended Executive 6 Non Executive Non Executive Non Executive Non Executive Non Executive The audit Committee is headed by Shri Nitin H Mehta as Chairman and includes other director namely Shri Mihir R Shah, who is Commerce Graduate and a reputed Share & Stock Broker of NIL

21 Ahmedabad Stock Exchange Limited. The Committee has also nominated Shri Bharatkumar V Mashruwala, another committee member. He is a graduate and a businessman having more than 15 years of experience. The Finance consultants is acting as coordinator who is regularly giving feed back on daily financial and accounting position of the company to the committee. In fact all the directors and Committee members have more than 15 years of industrial experience. The Chairman Mr. Nitin H Mehta has an experience of dealing in plastic and rubber industrial and industrial intermediate, industrial consumer products, procurement of raw materials at right time and marketing of products. The Committee meets at least once every quarter and prepare its minutes on the proceedings and business discussed, transacted. The Committee Reports to the Board and take action on Report and recommendations of the Board of Directors. All committee Reports and minutes are placed before the Board in all its meetings for information, guidance, directions and taking the same on record. In addition the Committee obtains guidance from the statutory auditors and other professionals of corporate repute from time to time to make timely compliances and payment of statutory dues. Other functions, powers, duties etc. of the committee are defined taking in to account the legal provision of the Listing Agreement and the same are kept flexible to be decided by the Board from time to time. (C) ROLE AND RESPONSIBILITY OF AUDIT COMMITTEE: The Audit Committee oversees the Company s financial reporting process and disclosure of its financial information, to recommend the appointment of Statutory Auditors and fixation of their remuneration, to review and discuss with the Auditors about internal control systems, the scope of auditor including the observation of the Auditors, adequacy of the internal audit system, major accounting policies, practices and entries, compliance with accounting policies, practices and entries, compliance with accounting standards and Listing Agreement entered in to with the Stock exchanges and other legal requirements concerning financial Auditors any significant finding there on, to review the Quarterly, Half Yearly and Annual Financial statement before they are submitted to the Board of Directors. The Committee also meets the operating management personal and reviews the operations, new initiatives and performance of the business units. Minutes of the Audit Committee meeting are circulated to the Member of the Board, discussed and taken note of. Other duties include review of factory operations, cost control method, systems, inventory management systems, production programmes, logistic management for movement of goods, disposal of scrap and non usable goods and materials, their accounts, legal and corporate taxation compliances etc.

22 (3 ) INVESTOR GRIVANCE COMMITTEE (A). TERMS OF REFERENCE: To look into the complaints, if any and redress the same expeditiously. Beside, the committee approves allotment, transfer & Transmission of shares, Debentures any new certificates on split \ consolidation \ renewal etc. as may be referred to it by the Committee. In addition the committee also looks in to the stock exchange listing agreement compliances and also the shareholder and general public interest information through proper media and stock exchanges from time to time. (B). FORMATION: The Investors Grievance Committee presently comprises all Non Executive Directors. During the year the Committee held 12 meeting (Last Saturday of every month) The Attendance of Members at the Meeting was as follows : Sr. no. Name Type No. of Meeting Attended 1. Shri Mihir. R. Shah Chairman Shri Mayukh J Pandya Member Shri Nitin H Mehta Member 10 (C ) FUNCTIONS OF INVESTORS SERVICES COMMITTEE: The company has merged in this committee its earlier committee of share Transfer. This Committee looks in to all aspects and business related to Shares, Bonds Securities and retail investors. The committee also looks after the Dematerialization process of equity shares. The Committee is also empowered to keep complete records of shareholders, Statutory Registers relating to shares and securities, maintaining of the complete record of share Demated, Investors Grievances, complaints received from investors and also from various agencies. The committee has also appointed Mr. Kamlesh M Shah Practicing Company secretary as consultants to look after the legal cases and problems relating to the investors, shares securities etc. The committee meets every month to approve all the cases of shares Demat, transfer, issue of duplicate and resolution of the investors complaints, submission of information to various statutory authorities like NSDL / CDSL SEBI stock Exchanges Registrar of companies periodically and from time to time. Other function roles duties powers etc. have been clearly defined in line with the clause 49 of the Listing Agreement and kept flexible for medication by the Board from time to time.

23 (4) REMUNERATION COMMITTEE The Company is not paying any remuneration to all its Directors. As the Company has no business commercial activities, it has not earned any profit and has long overdue accumulated losses in its books of accounts; hence, it is not paying any sitting fees or commission of net profit or any other remuneration in kinds to any of its Directors. The Company does not have any Key Managerial Personnel receiving remuneration of more than Rs.2, 00,000/- Per Month. The Company is regular in labour compliances and payment of statutory labour dues with relevant authorities in time. In view of the size of the company and its financial operations, no remuneration committee is formed within the organization. Further except the cash salary and allowances no other benefits in the form of stock options or ESOP etc. are being offered to any Directors of the Company or to any key managerial personnel s for the year. NO OF BOARD AND COMMITTEE MEETING HELD DURING THE YEAR: Name of the Committee No. of Meeting held Board 6 Audit Committee Of Board 4 Investor Grievance Committee 12 DIRECTORS PRESENT AT THE LAST ANNUAL GENERAL MEETING DATED SEPTEMBER 30, Sr. Name of the Directors Designation No. 1. Shri Nitin H Mehta. Chairman & Director 2. Shri Harshadrai T Mehta. Director & Compliance Officer DETAILS OF ANNUAL GENERAL MEETING HELD DURING THE LAST 3 FINANCIAL YEARS: Date Time Venue Special Business if any resolutions passed. 29/09/ A.M. Plot No. 138/A, Sarkhej Bavla Road, Village: Vasna Chacharvadi, Taluka: Sanand, Dist: Ahmedabad: NO 29/09/ A.M. 30/09/ A.M. Plot No. 138/A, Sarkhej Bavla Road, Village: Vasna Chacharvadi, Taluka: Sanand, Dist: Ahmedabad: Plot No. 138/A, Sarkhej Bavla Road, Village: Vasna Chacharvadi, Taluka: Sanand, Dist: Ahmedabad: NO NO

24 EXTRA ORDINARY GENERAL MEETINGS: No Extra Ordinary General Meetings were held during the year. PASSING OF THE RESOLUTIONS BY POSTAL SYSTEM: The company had during the passed a Resolution under section 293(1)(a) of the Companies Act 1956 by menas of postal Ballot. At the last Annual General Meeting no resolution was passed by postal ballot. However, at this ensuing Annual General Meeting two resolutions under section 17 and 146 read with section 192A are required to be passed by means of Postal ballot. Your directors recommend to go through the special instructions sheet and postal ballot form. All postal ballot forms are required to be send to the company s registered office in a prepaid stamped envelop only. All postal ballots are required to reach the company s office on or before 5.00 p.m. of 7 th September The result on postal ballot will be declared by the chairman at the Annual General Meeting. MANAGEMENT DISCUSSION AND ANALYSIS REPORT: The Management Discussion and Analysis Report are forming part of the directors report also of the Corporate Governance Report is separately given elsewhere. DISCLOSURES: A MATERIALLY RELATED PARTY RRANSACTION: During there was no financial or business transactions made by the company with the related parties of Directors or the Key managerial persons. The details given in the Auditors report or the Balance sheet and other financial statements relating to previous year and are the outstanding balances carried forwarded during the year. As there was no transactions with the parties listed in the Register under section 301 of the Companies Act 1956 during the year no approval of any authority was required. B DETAILS OF LEGAL COMPLIANCES: The Company is regular in filing of Balance Sheet and other records with Registrar of Companies, Stock Exchanges, Filing of Income Tax return, sales tax returns, submission of quarterly financial results, shareholding patterns other documents with the stock exchanges etc. Except the shares delisted by the Stock exchange Mumbai, no other penalties whether financial or legal is imposed on the company by any authorities. C DETAILS OF NON COMPLIANCE There were no penalties imposed on the company by stock exchanges or SEBI or any statutory authority on any matter related to capital markets during the last three years.