THE COIMBATORE PIONEER MILLS LIMITED. enter. 75th ANNUAL REPORT

Transcription

1 THE COIMBATORE PIONEER MILLS LIMITED enter \ 75th ANNUAL REPORT

2 The Coimbatore Pioneer Mills Limited BOARD OF DIRECTORS DIRECTORS SRI. D. SHIVAKUMAR SRI. E. MOUNAGURUSAMY SRI. P. VIVEKANAND SRI. M. MAHESH KUMAR REGISTERED OFFICE & WORKS Jothipuram Post Coimbatore BANKERS Vijaya Bank AUDITOR SRI. K. ILANGOVAN, B.Com, F.C.A Chartered Accountant, Coimbatore.

3 NOTICE NOTICE is hereby given that 75TH ANNUAL GENERAL MEETING of the share holders of THE COIMBATORE PIONEER MILLS LIMITED will ba held at9.00 am on Thrusday the 23 December 2010 at Registered OfficefUNIT II MILL PREMISES) Jothipuram post, Coimbatore to transact thefollowing business: ORDINARY BUSINESS: 1. To consider the Profit and Loss Account for the financial year ended 31st March 2010, the Balance Sheet as at that date, the Report of Board of Directors and the Report of the Auditor. 2. To appoint a Director in place of Sri.P.Vivekanand who retires by rotation and being eligible offers himself for reappointment. 3. To appoint a Director in place of Sri.M.Maheshkumar who retires by rotation and being eligible offers himself for re-appointment. 4. To appointauditorto hold office till the conclusion of nextannual General Meeting and fix his remuneration. Special Business: 5. To consider and if deemed fit to pass with or without modification the following resolution as a Special Resolution: RESOLVED to take on record / accept the Draft Rehabilitation Scheme (DRS) as approved by the Board for Industrial and Financial Reconstruction (BIFR) under the provisions of Sick Industrial Companies (special provisions) Act 1985 RESOLVED FURTHER that the consent of the company be and is here by accorded for the sale of surplus lands owned by the Company together with buildings, Structures standing there on in terms of the guide lines prescribed and in Compliance with the Draft Rehabilitation Scheme (DRS) as approved by Bl FR. RESOLVED FURTHER that subject to confirmation of BIFR. the Capital of the company be de-rated by 90% or such other ratio as may be approved by Bl FR by reducing the Share Capital of the Company and that the reduction be effected by cancelling the paid up Capital which has been lost un represented by available assets and there upon the face value of theshares be reduced from. 10 to.1/or such other value as maybe approved by BIFR RESOLVED FURTHER that for the purpose of giving effect to the above resolution the Board of Directors be and is hereby authorized on behalf of the Company to do all such acts, deeds, matters and things as it may in this absolute description deem fit or necessary or desirable for such purpose and with power on behalf of the Company to settle any Questions, difficulties or doubts that may arise in this regard without requiring the Board of Directors to secure any further consent or approval of the members of the Company. EXPLANATORY STATEMENT IN TERMS OF SEC.173 OF THE COMPANIESACT, 1956 Item No. 5 The Company was declared sick on by Board for Industrial and Financial Reconstruction (BIFR) under the provisions of Sick Industrial Companies (Special Provisions) Act, At the hearing held on BIFR directed the Company to submit a Rehabilitation Scheme to the Operating Agency M/s.Industrial Development Bank oflndia(idbi). A draft DRS was prepared and submitted to BIFR through the Operating Agency and BIFR had circulated the Scheme on Statutory hearing to hear any objections and also to peruse the Scheme was held on

4 In terms of the DRS circulated for revival of the Company the following have been considered: Sale of lands measuring acres where the present Unit-ll is situated. De-rating of the paid up capital by90%. After the statutory hearing on various objections had been raised and Bl FR on various hearings heard all the objections and on the final hearing held on has approved the DRS. However, the detailed order has not yet been received. One of the conditions during the hearing mentioned was that the Company should by a Special Resolution get approval from the shareholders for de-rating of the shares. Further, it is felt that as a good governance the members shall be informed that the rehabilitation of the scheme will become successful only on sale of the lands on which Unit-ll is situated and relocate the unit at such a place as the Board of Directors may deem fit in the interest of the Company and hence to seek their consent for sale of the lands also. The consent of the members is also sought for derating of the Shares to the extent of 90% or such other ratio as may be approved by BIFR by reducing the Share Capital of the Company and consequently the face value of the Shares from. 10/-to 1/-orsuch other value as may be approved by BIFR Accordingly, the said resolutions are submitted for your approval. Interest of Directors: All the Directors of the Company are interested or concerned in the above resolution to the extent of their shareholding in the Company Inspection of documents: The following documents will be open for inspection at the registered office of the Company during business hours on any working day: a. Memorandum and Articles of Association of the Company. b. Draft Rehabilitation Scheme submitted to Bl FR. Place : Coimbatore Date : By Order of the Board ForTHE COIMBATORE PIONEER MILLS MITED (Sd) E.Mounagurusamy NOTE: DIRECTOR 1. A MEMBER WHO IS ENTITLED TO ATTEND AND VOTE IS ENTITLED TO APPOINT A PROXY TO ATTEND AND VOTE INSTEAD OF HIMSELF AND THE PROXY NEED NOT BE A MEMBER. 2. PROXIES IN ORDER TO BE EFFECTIVE MUST BE DEPOSITED AT THE REGISTERED OFFICE OF THE COMPANY IN JOTHIPURAM POST, COIMBATORE NOT LESS THAN 48 HOURS BEFORE HOLDING THE MEETING. 3. MEMBERSARE REQUESTED TO BRINGTHEIR COPY OFTHEANNUALREPORTWITHTHEMTO THE ANNUALGENERALMEETING. 4. MEMBERS/PROXIES SHOULD BRING THE ATTENDANCE SLIP DULY FILLED IN FOR ATTENDING THE MEETING.

5 Ladies and Gentlemen, DIRECTOR'S REPORT Your Directors present their 75* Annual Report along with the audited accounts of the company for the financial year ended 31st March WORKING RESULTS: The working of the Company during the year under review has resulted in a Net Loss of /-- after providing for depreciation amounting of.nil and all other expenses. After taking income and expenditure of prior years, the Loss of this year to be carried forward comes to, /- WORKING OF THE COMPANY: The Textile Industry continued to reel under recession and the year was a difficult year for the Company. REFERENCE BIFR: Your company was declared sick by Hon'ble Board for Industrial and financial Reconstruction (BIFR) in the hearing held on In the hearing held on BIFR directed your Company to submit a draft rehabilitation scheme (DRS) and accordingly your company had submitted a draft rehabilitation to the Operating Agency (OA) IDBI Bank Limited (IDBI) and IDBI after considering the same to BIFR. BIFR on had circulated the same and fixed as the statutory hearing date to consider objections, if any, for approving the DRS. The statutory hearing was held on and after the hearing on various dates, in the final hearing held on , BIFR has sanctioned the rehabilitation scheme. The final order is not yet received and expected shortly. In terms of the DRS the lands measuring about acres situated at Periyanaicken palayam village shall be sold as per the guide lines fixed by BIFR and the proceeds shall be used to rehabilitate the unit in a different location as may be suitable for the operation of your Company. Subject to confirmation of BIFR, the Capital of the Company shall be derated by 90% or such other ratio as may be approved by BIFR by reducing the Share Capital of the Company and that reduction shall be effected by cancelling the paid up capital which has been lost or un represented by available assets and there upon the face value of the Shares be reduced from to Re 1 /- or such other values as may be approved by Bl FR. In respect of payment of certain statutory dues on PF, ESI, Income Tax, Central Excise etc your company shall reconcile with the concerned departments the amounts payable and has agreed to pay: PF : ESI: Contributions, interestas pertheact. To waive damages, penal interest etc Contributions and to waive interest, penal interest and Damages

6 Income Tax : To allow to carry forward the business losses, to set off capital gains against losses, to accept unpaid amount Income tax, wealth tax, TDS etc and waive interest, penal interest, damages, to carry forward unabsorbed depreciation, Central Excise : To waive interest, penalty on delayed payment DGFT : To allow to fulfill export obligations as per exim policy Sales Tax : To complete the assessment without insisting any and VAT declaration forms. To waive any penalty interest etc CORPORATE GOVERNANCE: Some of the compliances relating to Corporate Governance and Stock Exchange formalities as per SEBI rules are to be complied with. Your Company has not paid the listing fees for the year DIRECTORS: Sri.P.Vivekanand and Sri M.Mahesh Kumar are due to retire by rotation at the ensuing Annual General Meeting and being eligible, offer themselves for re-appointment. DIRECTORS RESPONSIBILITY STATEMENT: In compliance with Section 217 (2AA) of the Companies Act, 1956 the Directors of your Company confirm that: 1. All applicable accounting standards have been followed in the preparation of annual accounts and that there are no material departure; 2. Such accounting policies have been selected and applied consistently and such judgments and estimates made are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at 31st March,2010 and of the Loss of the Company for the year ended on that date 3. Proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities : 4. The Annual Accounts have been prepared on a going concern basis.

7 DEPOSITS: The Company has not accepted any deposits during the year. 24 deposits totalling to /-,including 15 deposits totaling /- received from Mis. Gikay investments Anstait an OCB though matured remain unpaid as on The repayment of this deposit shall be included in the DRS approved by BIFR on and the final order is to be received by your Company. AUDITORS: The Company's Auditor Sri. K. ILANGOVAN, B.Com, FCA, Chartered Accountant, Coimbatore is to retire at the ensuing Annuai General Meeting. He is eligible for reappointment. And have consented to act as auditor of the company, if appointed and the necessary certificate pursuant to Section (b) of the Companies Act, 1956 have been received from him. GENERAL: There are no employees falling under section 217(2A) of the Companies Act, 1956 and hence there is no enclosure of the particulars of employees and the information pursuant to the Companies (Disclosure of Particulars in the report of Board of Directors) Rules The Directors wish to place on record their appreciation of the work by the employees in various levels. We pray for the grace of almighty Sri Ranganathar for the prosperity of the Company. Place : Coimbatore Date : For and on behalf of the Board (Sd) E.Mounagurusamy Director (Sd) M.Mahesh Kumar Director

8 FORM OF DISCLOSURE OF PARTICULARS WITH RESPECT TO CONSERVATION OF ENERGY CURRENT PREVIOUS A. POWER AND FUEL CONSUMPTION YEAR YEAR ELECTRICITY a) Purchased Units Tola! Rate per unit b) OWN GENERATION 1, Through Diesel Generatoi Units Units per litre of diesel Cost per unit 2. Tnrough steam turbine Generated units Units per litre of diesel Units per litre of fuel/oil gas Cost per unit 1. Through windmill Units generated Cost per unit 2). Coal (Specify quality and where used) Total cost Average rate - 3). Furnace oil Quantity (in liters) Total cost Average cost 4). Others internal generation A. CONSUMPTION PER UNIT OF PRODUCTION Yarn -Produced (Tonnes) Per tonne Electricity Furnace Oil Coa! Others II PARTICULARS OF TECHNOLOGY ABSORPTION The company has no R&D Division. The Company is a member of the South India Textile Research Association and gets the benefits of their research. III a) Foreign Exchange Earnings b) Foreign Exchange Outgo

9 THE COIMBATORE PIONEER MiLLS LTD ADDENDUM TO DIRECTOR'S REPORT Regarding the qualifications made by the Auditor in his report, the directors would like to state as under: - SIGNIFICANT ACCOUNTING POLICIES AND PRACTICES: - 1). NOTE NO. 7 Note itself is self explanatory 2) NOTE NO. 21 During the year, the company has reconciled certain accounts of sundry debtors and creditors Further efforts are being made to obtain Confirmation and reconcile the same 3) NOTE NO. 24 On account of nonpayment of renewal premium due on , the Company couldn't obtain confirmation from M/S Life Insurance Corporation of India with whom it has taken a Master Policy for retirement benefits regarding incremental liability on account of gratuity accrued during the yeai. In the absence of such a certificate, the Company had estimated such liability on the basis of earnings of the employees and haa provided tor the incremental liability in tne books of the account for the cm rent year. 4) Note : No. 27 In view of the difficult working capital position of the company, the company has not been able to remit the tax deducted at source to the Government However, all effects are being made to make this payment at the earliest AUDITORS REPORT; 5) Para 6 a) The Company has been legally advised that "Letter of Dues" issued by the Company will not corne within the definition of the Word "Deposits" under the Companies Act b) Repayment of 15 Deposits due to Overseas Corporate Body has been included in me drat; rehabilitation scheme submitted to BIFR Deposits will be repaid as per the scheme as soon, as tha same is approved bybifr 6) Para 9 The delay in remittance of Provident Fund and Employees State Insurance dues are to oe attributed to the adverse working conditions and the consequent liquidity crunch Efforts are being made io repay the overdue installments as soon as possible 7) ParalO The Company has already taken steps for strengthening internal Control procedures For and on behalf of the board Place : Coimbatore Date : 27, (Sd) E.Moiinagurusamy Director (Sd) M. Mahesh Kumar Director

10 AUDITOR'S REPORT TO THE SHAREHOLDERS OF THE COIMBATORE PIONEER MILLS LIMITED 1. I have audited the attached Balance Sheet of M/s. THE COIMBATORE PIONEER MILLS LIMITED as at 31 s March, 2010, the Profit and Loss Account and also the Cash Flow Statement for the year ended on that date annexed thereto. These financial statements are the responsibility of the Company's management. My responsibility is to express an opinion on these financial statements based on my audit, 2. I conducted my audit in accordance with auditing standards generally accepted in India. Those Standard require that I plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidences supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. I believethatmyauditprovidesareasonablebasisformyopinion. Subject to a) Note No.7 no provision for exchange rate fluctuation. b) Note No.21 regarding confirmation of balances. c) Note No.24 regarding gratuity. d) Note No.27 regarding non-remittance of TDS 3. As required by Companies (Auditor's Report) order, 2003 issued by the Central Government of India in terms of Sub Section (4A) of Section 227 of the Companies Act, 1956 I enclose in the annexure a statement on the matters specified in paragraphs 4 and 5 of the said order. 4. The Company is a Sick Industrial Company within this meaning of Clause (o) of Sub-Section (1) of Section 3 of Sick Industrial Companies (Spedal Provisions) Act, 1985 as per the BIFR Order No. 103 dated 17/06/ Furtherto my comments in the Annexure referred to above, I report that: I have obtained all the information and explanations which to the best of my knowledge and belief were necessary forth purpose of my audit. In my opinion, proper books of account as required by law have been kept by the company so far as appears fromrny examination of those books. The Balance Sheet, Profit & Loss Account and Cash Flow Statement dealt with by this report is in agreementwith the books of account. In my opinion, the Balance Sheet, Profit and Loss Account and Cash Flow Statement dealt with by this report comply with the mandatory Accounting Standards referred to in Section 211 (3C) of the Companies Act, On the basis of information and scrutiny of books of accounts I state that the directors of this company as on 31.03,2010 are disqualified for appointment as directors in any other Public Limited Company being appointed as director in terms of clause (g) of Sub-Section 1 of Section 274 of the Companies Act, In my opinion and to the best of my information and according to the explanations given to me, the said accounts read with the significant accounting policies and the notes thereon, give the information required by the Companies Act, 1956 in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India I. In the case of the Balance Sheet of the state of affairs of the company as at31 sl March 2010 ii. In the case of Profit & Loss Account, of the Loss of the company for the year ended on that date and Mi. In the case of the Cash Flow Statement, of the cash flows for the year ended on that date. (SD) K.ILANGOVAN Chartered Accountant Place : Coimbatore Date :