Directors Report of Watson Software Ltd.

Mar 31, 2007

The Directors have pleasure in presenting the-18th Annual Report and the Audited Statement of Accounts of your Company for the financial year ended 31st, March, 2007.

FINANCIAL RESULTS : (Rs. In Lacs) Particulars 2006-07 2005-06

Sales and other Income 06.10 07.25 Loss before Interest (0.38) (0.16) Depreciation & Tax Less : Depreciation Loss before Tax & Interest (0.38) (0.16) Provision for Taxation & Interest Loss after Taxation & Interest (0.38) (0.16) Balance brought forward 50.45 50.61 from previous year Balance carried forward 50.07 50.45 to next year.

AUDITORS

It is recommended to appoint M/S P. R. AGARWAL & AWASTHI, Chartered Accountants, the Statutory Auditor for the current year and fix their remuneration.

PARTICULARS OF EMPLOYEES

The particulars as required under section 217(2A) of the Companies Act, 1956 read the Companies (Particulars of Employees) Rules, 1975 are not given or non of the Employees of your Company is covered by the prescribed amount of remuneration in this connection.

DIVIDEND

In view of the loss suffered during the year, Directors are unable to recommend any dividend on the equity shares for the year under review.

CLAIM FOR FIRE

The insurance company sanctioned claim of Rs. 1 lacs which is taken by PNB who does not have a charge registered with the Registrar Of Companies.

FIXED DEPOSIT

The Company has not invited/received any Fixed Deposit from the public during the year under report.

LITIGATION

There is no litigation against company except a matter in DRT II, by Punjab National Bank. The Decree issued by DRT II is disputed by the company as it differentiates in amounts and dues of directors in personal capacities.

DIRECTORS

MR. SANJAY RATHI Director of the Company retires by rotation at the ensuing Annual General Meeting and being eligible for offers him-self re-appointment.

DIRECTORS RESPONSIBILITY STATEMENT.

Your Directors confirm that:

1. In the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures;

2. The Directors have selected such accounting policies and applied them consistently and made judgments and estimates that were reasonable and prudent so as to give a true and fair view of the state of affairs of your Company at the end of the financial year and of the profit or loss of the Company for that period under review;

3. The Directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of your Company and for preventing and detecting frauds and other irregularities;

4. That the Directors had prepared the annual accounts for the year ended 31st march, 2007 on a going concern basis.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNING AND OUTGOING.

The information as required by the Companys (Disclosures of particulars in the report of Board of Directors) rules, 1988 is given in the annexure forming part of the report.

ACKNOWLEDGEMENT.

Your Directors wish to place on record their appreciation for the whole hearted and sincere co- operation, the company has received from its dealers, suppliers, various Government Authorities & Share Holders of the Company.

By Order of the Board of Directors For Watson Software Limited

Directors Place : Mumbai Date : 11.07.2007

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Mar 31, 2006

The Directors have pleasure in presenting the 17th Annual Report and the Audited Statement of Accounts of your Company for the financial year ended 31st, March, 2006.

FINANCIAL RESULTS : (Rs. In Lacs)

Particulars 2005-06 2004-05

Sales and other Income 07.25 14.10

Loss before Interest (0.10) (0.06)

Depreciation & Tax Less : Depreciation -

Loss before Tax (0.10) (0.06)

Provision for Taxation Loss after Taxation (0.10) (0.06)

Balance brought forward 50.61 50.67 from previous year

Balance carried forward 50.51 50.61 to next year

AUDITORS

It is recommended to appoint M/S P. R. AGARWAL & AWASTHI, Chartered Accountants, the Statutory Auditor for the current year and fix their remuneration.

PARTICULARS OF EMPLOYEES

The particulars as required under section 217(2A) of the Companies Act, 1956 read the Companies (Particulars of Employees) Rules, 1975 are not given or non of the Employees of your Company is covered by the prescribed amount of remuneration in this connection.

DIVIDEND

For want of sufficient profit, Directors are unable to recommend any dividend on the equity shares for the year under review.

CLAIM FOR FIRE

The insurance company sanctioned claim of Rs. 1 lacs which is taken by PNB who does not have a charge registered with the Registrar Of Companies.

FIXED DEPOSIT

The Company has not invited/received any Fixed Deposit from the public during the year under report.

LITIGATION

There is no litigation against company except a matter in DRT II, by Punjab National Bank. The Decree issued by DRT II is disputed by the company as it differentiates in amounts and dues of directors in personal capacities.

DIRECTORS

Mrs. Neela S. Mody, Director of the Company retires by rotation at the ensuing Annual General Meeting and being eligible for offers her-self re-appointment.

DIRECTORS RESPONSIBILITY STATEMENT.

Your Directors confirm that:

1. In the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures;

2. The Directors have selected such accounting policies and applied them consistently and made judgments and estimates that were reasonable and prudent so as to give a true and fair view of the state of affairs of your Company at the end of the financial year and of the profit or loss of the Company for that period under review;

3. The Directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of your Company and for preventing and detecting frauds and other irregularities;

4. That the Directors had prepared the annual accounts for the year ended 31st march, 2006 on a going concern basis.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNING AND OUTGOING.

The information as required by the Companys (Disclosures of particulars in the report of Board of Directors) rules, 1988 is given in the annexure forming part of the report.

ACKNOWLEDGEMENT.

Your Directors wish to place on record their appreciation for the whole hearted and sincere co- operation, the company has received from its dealers, suppliers, various Government Authorities & Share Holders of the Company.

By Order of the Board of Directors, For Watson Software Limited

Directors

Place : Mumbai Date : 15.07.2006

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Mar 31, 2004

Dear Members, The Directors' have pleasure in presenting the 15th Annual Report and the Audited Statement of Accounts of your Company for the financial year ended 31st, March, 2004. FINANCIAL RESULTS: (Rs. In Lacs) PARTICULARS 2003-04 2002-03 Sales and other Income 20.65 432.48 Profit before Interest (1.17) (0.45) Depreciation & Tax Less : Depreciation - - Profit before Tax (1.17) (0.45) Provision for Taxation - - Profit After Taxation (1.17) (0.45) Balance brought forward 51.85 52.31 from previous year Balance carried forward 50.67 51.85 to next year AUDITORS It is recommended to appoint M/s. B. M. Gattani & Co., Chartered Accountants, the Statutory Auditor for the current year and fix their remuneration. PARTICULARS OF EMPLOYEES The particulars as requred under section 217(2A) of the Companies Act, 1956 the Companies (Particulars of Employees) Rules, 1975 are not given or non of the Employees of your Company is covered by the prescribed amount of remuneration in this connection. DIVIDEND In view of losses your directors' are unable to recommended any dividend on the equity shares for year under review. CLAIM FOR FIRE The Company has lodbed claim with National Insurance Company for machine damaged due to fire at Palgarh factory. The Claim is still pending. FIXED DEPOSIT The Company has not invitudlreccwed any Fixed Deposit from the public during the year under report. (Acceptance of Deposit) rules 1975. LITIGATION APPEAL FILED IN APPELATE TRIBUNAL IS DISMISSED without hewing of the counterclaim with reference to order of High Court by Hon. Judge F.I Reibello your Company after due consultation with eminent lawyers will file special writ petition in High Court Bench to pressurize your claim and to get some rewards. The "Management is hopeful of getting a favourable order. DIRECTORS` Mrs. Neela S. Mody, Director of the Company retires by rotation at the ensuring Annual General Meeting and being eligible for offers her self re-appointment. DIRECTORS` RESPONSIBILITY STATEMENTS: The Director's confirm that: 1. In the preparation of the annual atscounis, the applicable accounting titandards had heen followed along with proper explanation relaiing to material departures; 2. The Director's have selected such accounting policies and applied them consistently and made judgments and estimates that we=e reasonable and prudent so as to give a true and fair View of the state of affairs of your Company at the end of the financial year and of the profit or loss of the Company for that period tuider review; 3. The Directors had taken propel and sufficient care for Lhe maintenan" of adltlate acc?Unting records in accordance with the provisions of the Companies Act, 1956 for safeguarding tljassets of your Company and for preventing arid detecting frauds and other irregularities; 4. That the Directors' had prepared the annual accounts for tlrc year ended 31 march, 2004 on a going concern basis. CONSERVATION OF ENERGY, TECHNOLLCY ABSORPTION AND FOREIGN EXCHANGE EARNING AND OUTGOING. The information as required by the companies (Disclosures of particulars in the report of Board of Directors') rules, 1988 is given in the annexure forming part of the report. ACKNOWLEDGEMENTS: The Directors wish to place on record their apprrciation for the whole hearted and sincere co-operation, The company has received from its dealers, suppliers, various Government Authorities & Share Holders of the Company. By Order of the Board of Directors For Watson Software Limited Satish V. Mody Managing Director Place: Mumbai Date: 22nd September, 2004 ANNEXURE TO DIRECTORS' REPORT: Information as per Section 217(IXe), read with Companies (Disclosure of Particulars in the Report of Board of Directors') Rules, 1988, and forming pat of the Directors' Report. A. Conservation of Energy The Production is totalty stopped during the year under report. a) Energy Conservation measures taken The Company has been continuously making effort to conserve energy by close monitoring energy consumption equipments and by economizing on the use of power in production by installing latest equipments. b) Additional Investment and proposal : If any being implemented fur reduction of consumption of energy Nil. c) Impact of measures (a) and above These measures have resulted in reduction in cost of production. B. Technology Absorption; i. Research and Development (R&D) a) Specifica on areas in which Research and Development carried out by company-None b) Future Plan of Action to continue in-house Research and Development activities in the relevant arcas c) Expenditure on Research & Development It as not been shown under respective heads of expenditure in the profit and loss Account as no separate account in maintained. 2. Technology absorption, adaptation and innovation The company is constantly interacting with indigenous Raw material & Machinery supplier as also with National & International Laboratories Agencies with a view to absorb and adopt latest technologies in the field of its range of Products. By order of the Board of Directors For Watson Software Limited Mr. Satish V. Mody Managing Director Place : Mumbai Date : 22nd September, 2004.

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Mar 31, 2001

Your Director's have pleasure in presenting the 12th Annual Report of the Company for the year ended 31st March, 2001 together with Auditors Report thereon.

FINANCIAL RESULT :

PARTICULARS 2000-2001 1999-2000

Sales and other Income 846.70 682.96 Profit before Interest, Depreciation and Tax 13.79 13.75 Less : Depreciation 14.21 14.21 Profit before tax (0.42) (0.46) Provision for taxation Profit after taxation (0.42) (0.46) Balance brought forward From previous year 55.59 56.05 Balance Carried to 55.17 55.59 Balance Sheet

PERFORMANCE DURING THE YEAR

The plant and Machinery though capable to achieve more production and turnover was effected mainly due to scarcity of working capital from Bank. Subsidy of DCK (State Govt.) was not received.

DIVIDEND

Due to loss in the current year, your director are unable to recommend any dividends for the current year.

CLAIM FOR FIRE

Your Company has lodged claim with National Insurance Company for machine damaged due to fire at palghar factory. The claim is still pending.

LITIGATION :-

Your Company has been facing acute shortage of funds. Instead of advanciong funds for working capital, bankers of the company, Punjab National Bank, has filed a suit against the company in Debt Recovery Tribunal considering the loss suffered by your company due to non co-operation of Bank.

Punjab National Bank, for power project in Gujrat, a claim of Rs. 351 Crorcs was lodged against PNB. Debt Recovery Tribunal [DRT] had passed order against the company by ignoring company's counter claim of Rs. 351 Crores and left with no alternative, your company has filled an appeal with DRT at Appellate Authority and is currently pending

DEMATERIAL ISATION OF SHAKES :-

In terms of SEBI guidelines, the Equity shares of the company are being trailed in compulsory dematerialised form w.e.f. 30-10-2000. Your company has made all the arrangement to establish connectivily with National Securities Depository Ltd.(NSDL) and Central Depository (Services) Ltd. CDS). The Connectivity has been established through Datamatics Financial Software services Ltd. From 01.08.2001. R &T / Department Transferred to Big Shares Services Pvt. Ltd. Andheri (E).

FIXED DEPOSIT

Your Company has not accepted any deposits during the year under The Company's (Acceptance of Deposit) Rules 1975.

DIRECTORS

Mr. Sameer Kharmate Director of the Company retires by rotation at the ensuing Annual General Meeting and being eligible offers himself for re-appointment.

AUDITORS

It recommended to appoint auditors for the current year and fix their remuneration M/s. B.M. Gattani & Co. Chartered Accountants retire and are eligible for reappointment.

CHANGE OF NAME

The name of company has been changed from Dhara Packaging Limited to Watson Software Ltd. with effect from 09.02.2000. After change of name of the company, your Director have been in dialogue with foreign collaborators for starting new activity in the field of Information Technologies. Your company is actively considering to start call center and also enter in the area of software packages.

PARTICULARS OF EMPLOYESS

The company did not have any employee drawing remuneration in excess of the limits prescribe under section 217 (2A) of the Companies (Particulars of Employees) Rules as amended.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGOING

The information as required by the Company's (Disclosure of particulars in the report of board of Directors) Rules, 1988 is given in the annexure forming part of this report.

INDUSTRIAL RELATIONS

During the year the relations with workers are cordial and good

ACKNOWLEDGEMENT

Your Directors wish to place on record their appreciation for the whole he arted and sincere co-operation, the company has received from its dealers, suppliers and various Goverment authorities

For and on behalf of Board of Directors

Place : Mumbai SATISH V.MODY Date : 10.08.2001 Chairman & Managing Director

ANNEXURE 'A'

Information under Section 217 (I) (e) of the companies Act, 1956 read eith companies (Disclosure of particulars in the Board of Directors) Rules, 1988.

(A) CONSERVATION OF ENERGY

(a) Energy Conservation measures taken :

The Company has been continuously making efforts to conserve energy by closel monitoring energy consuming equipment and by economising on the use of power in production by installing latest equipments.

(b) Additional investment and proposal, if any being implemented for reduction of consumption of energy - NIL

(c) Impact of measure (a) and (b) above : These measures have resulted in reduction in cost of production.

(d) Total energy consumption and energy consumption per unit of production - NOT APPLICABLE

(B) TECHNOLOGY ABSORPTION

(I) RESEARSH AND DEVELOPMENT

(a) Specification areas in which Research and Development carried out by the Company None

(b) Future plan of Action

To continue In-house Research and Development activities in the relevant areas.

(c) Expenditure on Research & Development

Expenditure on In-house Research & Development has been shown under respective heads of expenditure in the profit and loss Account as no separate account is maintained

(2) TECHNOLOGY ABSORPTION/ADAPTION AND INNOVATION :

The Company is constantly interacting with indigenous Raw Material and Machinery supplier as also with National and International Laboratories /Agencies with a view to absorb and adopt latest technologies in the field of its range of products.

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Mar 31, 2000

The Director's have pleasure in presenting the 11th Annual Report of the Company for the year ended 31st March, 2000 together with Auditors Report thereon.

FINANCIAL RESULTS :

(Rs. in Lacs) Particulars 1999-2000 1998-1999

Sales and other Income 682.96 167.04

Profit before Interest, Depreciation and Tax 13.75 8.24

Less : Interest -- 0.14

Depreciation 14.21 14.21

Profit before tax (.46) (6.11)

Provision for taxation -- --

Profit after taxation (0.46) (6.11)

Balance brought forward from previous year 56.05 58.33

Previous year adjustment -- 3.83

Balance Carried to Balance Sheet 55.59 56.05

PERFORMANCE DURING THE YEAR

The Plant and Machinery though capable to achieve more production and turnover was effected mainly due to scarcity of working capital from work. Subsidy of DCK (State Govt.) was not received as a means to finance to the project.

DIVIDEND

Due to loss on the current year, the directors are unable to recommend any dividends for the current year.

CLAIM FOR FIRE

The Company has lodged claim with National Insurance company for machine damaged due to fire at Palghar factory. The claim is still pending.

WORKING CAPITAL

The Company has been sanctioned working capital facility of Rs. Fifty Lacs by Punjab National Bank The Company's total requirements of working capital facilities is about Rs. Once Hundred and Fifty Lacs and as such the existing facilities sanctioned to the Company are not adequate to meet the requirement of funds.

FIXED DEPOSITS

The Company has not accepted any deposits during the year under The Company's (Acceptance of Deposits) Rules, 1975.

DIRECTORS

Mrs. Neela S. Mody, Director of the Company retires by rotation at the ensuing Annual General Meeting and being offers himself for re-appointment.

AUDITORS

You are requested to appoint auditors for the current year and fix their remuneration. M/s B. M. Gattani & Co., Chartered Accountants, retire and are eligible for re-appointment.

CHANGE OF NAME

The name of Company has been change from Dhara Packaging Limited to Watson Software Limited with effect from 09.02.2000.

PARTICULARS OF EMPLOYEES

The Company did not have any employee drawing a remuneration in excess of the limits prescribed under section 217 (2A) of the Company's Act 1956, read with the Companies (Particulars of Employees) Rules as amended.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGOING

The information as required by the Company's (Disclosure of Particulars in the report of Board of Directors) Rules, 1988 is given in the annexure forming part of this report.

INDUSTRIAL RELATIONS

During the year the relations with workers are cordial and good.

ANNEXUTE `A'

Information under Section 217 (1) (e) of the Companies Act, 1956 read with the Companies (Disclosure of Particulars in the Board of Directors) Rules, 1988.

(A) CONSERVATION OF ENERGY

(a) Energy Conservation measures taken :

The Company has been continuously making efforts to conserve energy by closely monitoring energy consuming equipment and by economising on the use of power in production by installing latest equipments.

(b) Additional investment and proposal, if any being implemented for reduction of consumption of energy - NIL.

(c) Impact of measures (a) and (b) above :

These measures have resulted in reduction in cost of production.

(d) Total energy consumption and energy consumption per unit of production-NOT APPLICABLE

(B) TECHNOLOGY ABSORPTION

(1) RESEARCH AND DEVELOPMENT :

(a) Specific areas in which Research and Development carried out by the Company

NONE

(b) Future Plan of Action

To continue In-house Research & Development activities in the relevant areas.

(c) Expenditure on Research & Development

Expenditure on In-house Research & Development has been shown under respective heads of expenditure in the Profit and Loss Account as no separate account in maintained.

(2) TECHNOLOGY ABSORPTION, ADAPTATION AND INNOVATION :

The Company is constantly interacting with indigenous Raw Material and Machinery suppliers as also with National and International Laboratories/Agencies with a view to absorb and adopt latest technologies in the field of its range of products.

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Mar 31, 1999

The Director's have pleasure in presenting the 10th Annual Report of the Company for the year ended 31st March, 1999 together with Auditors Report thereon.

FINANCIAL RESULTS :

(Rs. in lacs)

Particulars 1998-99 1997-98

Sales and other Income 167.04 730.78

Profit before Interest, Depreciation and Tax 8.24 15.96

Less : Interest 0.14 1.04

Depreciation 14.21 14.86

Profit before tax (6.11) (0.06)

Provision for taxation -- --

Profit after taxation (6.11) 0.06

Balance brought forward from previous year 58.33 58.27

Previous year adjustment 3.82 --

Balance Carried to Balance Sheet 56.04 58.33

PERFORMANCE DURING THE YEAR

The Plant and Machinery though capable to achieve more production and turnover was effected mainly due to scarcity of working capital from Bank. Subsidy of DCK (State Govt.) was not received as a means to finance to the project.

Dividend

Due to loss on the current year, the directors are unable to recommend any dividends for the current year.

CLAIM FOR THE

The Company has lodged claim with National Insurance company for machine damaged due to fire at Palghar factory. The claim is still pending.

WORKING CAPITAL

The Company has been sanctioned working capital facility of Rs. Fifty Lacs by Punjab National Bank The Company's total requirement of working capital facilities is about Rs. One Hundred and Fifty Lacs and as such the existing facilities sanctioned to the Company are not adequate to meet the requirement of funds. The Company is pursuing with the Punjab National Bank to sanction additional facilities. In the meantime the working of the Company continues to be affected for wants of funds.

FIXED DEPOSITS

The Company has not accepted any deposits during the year under The Company's (Acceptance of Deposits) Rules, 1975.

DIRECTORS

Mr. Satish V. Mody, Director of the Company retires by rotation at the ensuing Annual General Meeting and being offers himself for re-appointment.

AUDITORS

Consequent upon the resignation of the Company's auditor M/s. Rajmal Jain 7 Co., M/s. B.M. Gattani & Co. were appointed as auditor of the company and being eligible they offer themselves for the re-appointment at the forthcoming Annual General Meeting.

PARTICULARS OF EMPLOYEES

The Company did not have any employee drawing a remuneration in excess of the limits prescribed under section 217(2A) of the Company's Act, 1956, read with the Companies (Particulars of Employees) Rules as amended.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGOING

The information as required by the Company's (Disclosure of Particulars in the report of Board of Directors) Rules, 1988 is given in the annexure forming part of this report.

INDUSTRIAL RELATIONS

During the year the relations with workers are cordial and good.

Information under Section 217(1)(e) of the Companies Act, 1956 read with the Companies (Disclosure of Particulars in the Board of Directors) Rules, 1988.

(A) CONSERVATION OF ENERGY

(a) Energy Conservation measures taken :

The Company has been continuously making efforts to conserve energy for closely monitoring energy consuming equipment and by economising on the use of power in production by installing latest equipments.

(b) Additional investment and proposal, if any being implemented for reduction of consumption of energy - NIL.

(c) Impact of measures (a) and (b) above :

These measures have resulted in reduction in cost of production.

(d) Total energy consumption and energy consumption per unit of production-NOT APPLICABLE

(B) TECHNOLOGY ABSORPTION

(1) RESEARCH AND DEVELOPMENT :

(a) Specific areas in which Research and Development carried out by the Company

NONE

(b) Future Plan of Action

To continue In-house Research & Development activities in the relevant areas.

(c) Expenditure on Research & Development

Expenditure on In-house Research & Development has been shown under respective heads of expenditure in the Profit and Loss Account as on separate account is maintained.

(2) TECHNOLOGY ABSORPTION, ADAPTION AND INNOVATION :

The Company is constantly interacting with indigenous Raw Material and Machinery supplies as also with National and International Laboratories/Agencies with a view to absorb and adopt latest technologies in the field of its range of products.

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Mar 31, 1998

The Director's have pleasure in presenting the 9th Annual Report of the Company for the year ended 31st March, 1998 together with Auditors Report thereon.

FINANCIAL RESULTS : (Rs. in lacs)

Particulars 1997-98 1996-97

Sales and other income 730.78 712.70

Profit before interest, Depreciation and Tax 15.96 17.95

Less : interest 1.04 1.79

Depreciation 14.86 11.98

Profit before tax (0.06) 4.18

Provision for taxation - 0.60

Profit after taxation 0.06 3.58

Balance brought forward from previous year 58.27 54.69

Interim Dividend Reversed - -

Profit available for appropriation 58.33 58.27

Transfer to General Reserves - -

Balance Carried to Balance Sheet 58.33 58.27

PROJECTION VS ACTUALS :

The Comparative position of actual sales and profitability vis-a-vis projection given the prospectus dated July 12, 1995 is as under :

(Rs. in lacs)

Actuals year ended 31/03/1998

Sales 730.78

Profit after Tax 0.06

Dividend Not Declared

PERFORMANCE DURING THE YEAR :

The Plant and Machinery though capable to achieve more production and turnover was effected mainly due to scarcity of working capital from Bank. Subsidy of DCK (State Govt.) was not received as a means to finance to the project.

DIVIDEND :

To conserve the resources and to augment Working Capital requirements the directors are unable to recommend any dividend for the current year.

WORKING CAPITAL :

The Company has been sanctioned working capital facility of Rs. Fifty Lacs by Punjab National Bank. The Company's total requirement of working capital facilities is about Rs. One Hundred and Fifty Lacs and as such the existing facilities sanctioned to the Company are not adequate to meet the requirement of funds. The Company is persuing with the Punjab National Bank to sanction additional facilities. In the meantime the working of the Company continues to be affected for wants of funds.

FIXED DEPOSITS :

The Company has not accepted any deposits during the year under The Company's (Acceptance of Deposits) Rules, 1975.

DIRECTORS :

Mrs. Neela S. Mody, Director of the Company retires by rotation at the ensuing Annual General Meeting and being eligible offers herself for re-appointment.

AUDITORS :

Consequent upon the resignation of the Company auditor M/s. C.N. Shah & Associates, M/s. Rajmal Jain & Co., appointed as auditor of the company and they offer themselves for the re-appointment at the forthcoming Annual General Meeting.

PARTICULARS OF EMPLOYEES :

The Company did not have any employee drawing a remuneration in excess of the limits prescribed under section 217(2A) of the Company's Act 1956, read with the Companies (Particulars of Employees) Rules as amended.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGOING :

The information as required by the Company's (Disclosure of Particulars in the report of Board of Directors) Rules, 1988 is given in the annexure forming part of this report.

INDUSTRIAL RELATIONS :

During the year the relations with workers are cordial and good.

ANNEXURE TO DIRECTORS' REPORT

ANNEXURE 'A'

Information under Section 217(1)(e) of the Companies Act, 1956 read with the Companies (Disclosure of Particulars in the Board of Directors) Rules, 1988.

CONSERVATION OF ENERGY :

(a) Energy Conservation measures taken :

The Company has been continuously making efforts to conserve energy by closely monitoring energy consuming equipment and by economising on the use of power in production by installing latest equipments.

(b) Additional investment and proposal, if any being implemented for reduction of consumption of energy :

NIL.

(c) impact of measures (a) and (b) above :

These measures have resulted in reduction in cost of production.

(d) Total energy consumption and energy consumption per unit of production :

NOT APPLICABLE.

TECHNOLOGY ABSORPTION :

(1) RESEARCH AND DEVELOPMENT :

(a) Specific areas in which Research and Development carried out by the Company

NONE

(b) Future Plan of Action :

To continue in-house Research & Development activities in the relevant areas.

(c) Expenditure on Research & Development :

Expenditure on In-house Research & Development has been shown under respective heads of expenditure in the Profit and Loss Account as no separate account is maintained.

(2) TECHNOLOGY ABSORPTION, ADOPTION AND INNOVATION :

The Company is constantly interacting with indigenous Raw Material and Machinery suppliers as also with National and international Laboratories/Agencies with a view to absorb and adopt latest technologies in the field of its range of products.

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Mar 31, 1997

The Director's have pleasure in presenting the 8th Annual Report of the Company for the year ended 31st March, 1997 together with Auditors Report thereon.

FINANCIAL RESULTS (Rs. in lacs) Particulars 1996-97 1995-96

Sales and other Income 712.70 652.24

Profit before Interest, Depreciation and Tax 17.95 30.70

Less : Interest 1.79 0.37 Depreciation 11.98 13.21

Profit before tax 4.18 17.11

Provision for taxation 0.60 -

Profit after taxation 3.58 17.11

Balance brought forward from previous year 54.69 15.36

Interim Dividend Reversed - 22.22

Profit available for appropriation 58.27 54.69

Transfer to General Reserves - -

Balance Carried to Balance Sheet 58.27 54.69

PROJECTION VS ACTUALS

The Comparative position of actual sales and profitability visa-a-vis projection given the prospectus dated July 12, 1995 is as under :

(Rs. in lacs)

Projection Actuals year ended year ended 31/03/1997 31/03/1997

Sales 1,174.56 712.70 Profit after Tax 157.74 3.58 Dividend 15% Not Declared

PERFORMANCE DURING THE YEAR

The Plant and Machinery though capable to achieve more production and turnover was effected mainly due to scarcity of working capital from Bank. Subsidy of DCK (State Govt.) was not received as a means to finance to the project.

DIVIDEND

To conserve the resources and to augment Working Capital requirements the directors are unable to recommend any dividend for the current year.

WORKING CAPITAL

The Company has been sanctioned working capital facility of Rs. Forty Lacs by Punjab National Bank in the month of February. The Company's total requirement of working capital facilities is about Rs. One Hundred and Fifty Lacs and as such the existing facilities sanctioned to the Company are not adequate to meet the requirement of funds. The Company is pursuing with the Punjab National Bank to sanction additional facilities. In the meantime the working of the Company continues to be affected for wants of funds.

FIXED DEPOSITS

The Company has not accepted any deposits during the year under The Company's (Acceptance of Deposits) Rules, 1975.

DIRECTORS

Shri Rohit Udani, Director of the Company retires by rotation at the ensuing Annual General Meeting and being eligible offers himself for re-appointment.

AUDITORS

M/s. C.N. Shah & Associates, Auditors of the Company retire at the forthcoming Annual General Meeting and being eligible offer themselves for re-appointment.

PARTICULARS OF EMPLOYEES

The Company did not have any employee drawing a remuneration in excess of the limits prescribed under section 217(2A) of the Company's Act 1956 read with the Companies (Particulars of Employees) Rules as amended.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGOING

The information as required by the Company's (Disclosure of Particulars in the report of Board of Directors) Rules, 1988 is given in the annexure forming part of this report.

INDUSTRIAL RELATIONS

Even though during the year 1996-97 the industrial relations in the Company were cordial, in the month of May, 1997 some of the key workmen of the Company left the Company in unison, thereby paralysing the production activities of the Company. These workmen also resorted to giving away companies confidential information to the competitors. Under the circumstances the management was left with no other alternative but to declare lockout in factory w.e.f. 10th May, 1997. The Company has restarted the operation w.e.f. 1st July, 1997 with the help of some of the existing staffs and new recruitments.

Information under Section 217(1)(e) of the Companies Act, 1956 read with the Companies (Disclosure of Particulars in the Board of Directors) Rules, 1988.

1. CONSERVATION OF ENERGY

i. Energy Conservation measures taken : The Company has been continuously making efforts to conserve energy by closely monitoring energy consuming equipment and by economising on the use of power in production by installing latest equipments.

ii. Additional investment and proposal, if any being implemented for reduction of consumption of energy - NIL.

iii. Impact of measures (i) and (ii) above : These measures have resulted in reduction in cost of production.

iv. Total energy consumption and energy consumption per unit of production - NOT APPLICABLE

2. TECHNOLOGY ABSORPTION

i. RESEARCH AND DEVELOPMENT :

a. Specific areas in which Research and Development carried out by the Company

b. Future Plan of Action: To continue In-house Research & Development activities in the relevant areas.

c. Expenditure on Research & Development: Expenditure on In-house Research & Development has been shown under respective heads of expenditure in the Profit and Loss Account as no separate account is maintained.

ii. TECHNOLOGY ABSORPTION, ADAPTION AND INNOVATION :

The Company is constantly interacting with indigenous Raw Material and Machinery suppliers as also with National and International Laboratories /Agencies with a view to absorb and adopt latest technologies in the field of its range of products.

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Mar 31, 1996

Your Directors have pleasure in presenting the 7th Annual Report of the Company for the year ended 31st March, 1996 together with Auditors Report thereon.

The Comparative profitability of production recorded in prospectus dated July 12,1994 and Actuals.

(Rs. in lacs)

Projection Actuals year ended year ended 31/03/1996 31/03/1996

Sales 1,101.06 652.24 Profit after Tax 148.04 17.11 Dividend 15% Not Declared

PERFORMANCE DURING THE YEAR During the year under review your Company has shown increase in sales but not in profit. The Projection level is effected due to non-availability of working capital from banks. Sales & other income in the financial year were 652.24 as against 316.72 lacs for the previous period which amounts to an increase of 106% from the previous year. The Net profit after Tax and Depreciation is 32.47 lacs, which indicates a overall stabilised working of the Company under recessionary effects.

DIVIDEND To Conserve the resources and to augment Working Capital requirements your directors are unable to recommend any dividend for the current year.

WORKING CAPITAL Your Company's pending application with Bank of India is not approved on grounds the industry is very new to them. Your director's are approaching to the Banks as well as Institutions to sanction Working Capital limits. The Company is also considering floating Debenture issue to meet Working Capital Needs.

FIXED DEPOSITS Your Company has not accepted any deposits during the year under The Company's (Acceptance of Deposits) Rules, 1975.

FUTURE PLANS Your Company's Directors believe that infrastructure Projects will do well in the Coming years in view of Government Policies for such Projects. Hence your company is Planning to enter into a project for generation of Power to various electricity Boards under the consortium. The Company has identified State of Gujarat for setting up such a project.

DIRECTORS Smt. Neela S. Mody, Director of the company retires by rotation at the ensuring Annual General Meeting and being eligible offers herself for re-appointment.

AUDITORS M/s. C.N. Shah & Associates, Auditors of the Company retires at the forthcoming Annual General Meeting and being eligible offer themselves for Re-appointment.

PARTICULARS OF EMPLOYEES Particulars of Employees as per provision of Section 217 (2A) of the Company's Act, 1956, read with the Companies (Particulars of Employees) Rule, 1975 as amended is given in Annexure 'B' form the part of this report.

CONSERVATION OF ENERGY, TECHNOLOGY OBSERVATION AND FOREIGN EXCHANGE EARNINGS AND OUTGOING

The information as required by the Company's (Disclosure of Particulars in the report of Board of Directors) Rules, 1988 is given in the annexure forming part of this report.

INDUSTRIAL RELATIONS During the year under review, industrial relations in the Company continued to be satisfactory. The Directors place on record their appreciation for the services rendered by the members of the staff at all levels.

ACCOUNTS As per the provision of the Companies Act, 1956, a full Balance Sheet & Profit & Loss Account including schedules is being sent to all the shareholders of the Company.

Information under Section 217(1) (e) of the Companies Act, 1956 read with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988.

(A) CONSERVATION OF ENERGY (a) Energy Conservation measures taken

The Company has been continuously making efforts to conserve energy by closely monitoring energy consuming equipment and by economising on the use of power in production by installing latest equipments.

(b) Additional investment and proposal, if any being implemented for reduction of consumption of energy - NIL.

(c) Impact of measures (a) and (b) above

These measures have resulted in reduction in cost of production.

(d) Total energy consumption and energy consumption per unit of production-As per annexure 'A' attached.

(B) TECHNOLOGY ABSORPTION

(1) RESEARCH AND DEVELOPMENT:

(a) Specific areas in which Research and Development carried out by the Company.

Improving product quality

Improving productivity and reducing cost of production.

(b) Future Plan of Action

To continue In-house Research & Development activities in the relevant areas.

(c) Expenditure on Research & Development

Expenditure on in-house Research & Development has been shown under respective heads of expenditure in the Profit and Loss Account as no separate account is maintained.

(2) TECHNOLOGY ABSORPTION, ADAPTION AND INNOVATION The Company is constantly interacting with indigenous Raw Material and Machinery suppliers as also with National and International Laboratories/Agencies with a view to absorb and adopt latest technologies in the field of its range of products. The Company has recently entered into an MOU with Phazer Consultancy, a group company of group Phazer Technology, UK regarding Technology transfer of Primer Coated Paper for siliconising and used in Release paper. This product is alternative to Super Calender Paper.

(C) FOREIGN EXCHANGE EARNINGS AND OUTGO There has been no direct exports during the year. However, the Company recognize the need for boosting exports and as such continues to explore Overseas markets for its products.

Foreign Exchange Used - 1.38 Lacs Foreign Exchange Earned - NIL

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Mar 31, 1995

Your Director's have pleasure in presenting the 6th Annual Report of the Company for the year ended 31st March, 1995 together with Auditors thereon.

The comparative profitability of production recorded in prospectus dated July 12, 1994 and Actuals.

(Rs in Lacs)

Projection Actuals year ended year ended 31/03/1995 31/03/1995

Sales 898.93 316.72 Profit after Tax 121.46 30.83 Earning per Share 3.13 Dividend 15% 10%

The BOPP Plant which was projected for the capital utilisation of 70% in the year under review was delayed and came into production in the last quarter. The delay in implementation was due to late supply of machinery by the suppliers. However, the Company has recovered from the set back and delayed implementation. Your Company has entered into Joint Venture with M/s. L M T Technology, Germany for manufacturing Carbonless paper and Water Based Coated inks. There is only one manufacturer in India in this specilised category of manufacture.

DIVIDEND

Your Directors have recommended payment of Interim Dividend @ 10% for the year under review which is being proposed to be the final dividend.

PERFORMANCE DURING THE YEAR

During the year under review your Company has shown increase in both in terms of Sales and profitability. Although it is not up to the level which had been projected in the prospectus. Sales and other Income in the financial year were Rs. 316.13 Lacs as against Rs. 227.50 Lacs for the previous period which amounts to an increase of 30%. The Net Profit after tax of Rs. 30.83 Lacs compared to Rs. 12.60 Lacs in the previous year shows a quantum jump of 145%. This overall improvement in performance was acheived inspite of hike in Excise Duty by 20% affecting the production and sales.

PROSPECTS FOR THE CURRENT YEAR

The current year has begun with satisfactory output in the first 3 months. The commercial production of BOPP has commenced. Your Directors have decided to enter into the International market for Export of BOPP Tapes, Release Paper, Label Stock and other speciality papers. Your Company has secured Export orders worth Rs. 5 Crores and more enquiries are in process.

As informed, the Company has entered into a M.O.U. for a Joint -Venture with M/s. L M T Technology, Germany for manufacturing Carbonless paper and Water Based Coated Inks. To make the existing products lines viable, a M.O.U. has also been signed with M/s. Phazer Consultancy, U.K. to develop and market premier coated silicone papers in India and abroad, this will make our products more viable and competitive in India and in overseas markets.

As a part of diversification programme your Company has decided to Export different varieties of Basmati Rice and other products. The Company plans to emerge as one of the major Exporter by entering the Export market in a big way. In the domestic market your Company has been spreading its wings in other States. It gives pleasure to inform that in Karol Bagh, New Delhi, the Company has opened a branch to cater to the needs of the consumers in North India. In the near future, Company proposes to open a branch at Madras to cater to the market in South India.

FINANCE

Your Company came out with the Public Issue of Rs. 30,50,000 Equity Shares of Rs. 10/- each at par aggregating to Rs. 3,05,00,000/- in the month of August, 1994 and the same was Over Subscribed by 1.59 times in a recessionary market. The same enabled the Company to repay the Term Loans and Working Capital loan facilities availed from State Bank of Travancore. The repayment of loan was done due to the non-co-operative attitude of the bank with the expanding business requirements of the Company. The Company is now in the process of availing loan facilities from Bank Of India for meeting long term requirement of funds.

FIXED DEPOSITS

Your Company has not accepted any deposits during the year under the Company's (Acceptance of Deposits) Rules, 1975.

DIRECTORS

Shri Pawan Agarwal, Director of the Company retires by rotation at the ensuing Annual General Meeting and being eligible offers himself for Re-appointment.

During the year Shri Rohit Udani was appointed as additional Director in terms of section 260 of the Company's Act, 1956. Shri Rohit Udani holds office up to the date of the ensuing Annual General Meeting. The Company has received notice pursuant to section 257 of the Company's Act, 1956 proposing to appoint Shri Rohit Udani as Director of the Company. Your Board of Directors recommend the appointment of Shri Rohit Udani as a Director.

During the year under review Shri Suresh Mankad has resigned as Director of the Company with effect from 13th September, 1994.

The Board of Directors placed on record their appreciation for the services rendered by Shri Suresh Mankad during his association with the Company. Smt. Neela S. Mody was appointed as Whole-Time Director of the Company for a period of 5 years from 11th February, 1995 to 10th February, 2000.

AUDITORS

M/s. C.N.SHAH & ASSOCIATES, Auditors of the Company retire at the forth coming Annual General Meeting and being eligible offer themselves for Re-appointment.

PARTICULARS OF EMPLOYEES

Particulars of Employee as per provision of Section 217 (2A) of the Company's Act, 1956, read with the Companies (Particulars of Employee) Rule 1975 as amended is given in Annexure 'B' form the part of this report.

CONSERVATION OF ENERGY, TECHNOLOGY OBSERVATION AND FOREIGN EXCHANGE AND OUTGOING

The information as required by the Company's (Disclosure of Particulars in the report of Board of Rules, 1988 is given in the annexure forming part of this report.

INDUSTRIAL RELATIONS

During the year under review, Industrial Relations in the Company continued to be satisfactory. The Directors place on record their appreciation for the rendered by the members of the staff at all levels.

ABRIDGED ACCOUNTS

As per the provision of the Companies Act, 1956, an Abridged Balance Sheet & Profit and Loss Account is being sent to all the Shareholders of the Company.

ACKNOWLEDGEMENT

Your Directors wish to place on record their appreciation for the whole hearted and sincere co-operation, the Company has received from its dealers, suppliers, bankers and various Government authorities.

ANNEXURE 'A'

Information under Section 217(1) (e) of the Companies Act, 1956 read with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988.

(A) CONSERVATION OF ENERGY

(a) Energy Conservation measures taken:

The Company has been continuously making efforts to conserve energy by closely monitoring energy consuming equipment and by economising on the use of power in production by installing latest equipments.

(b) Additional Investment and proposal, if any being implemented for reduction of consumption of energy - NIL.

(c) Impact of measures (a) and (b) above:

These measures have resulted in reduction in cost of production.

(d) Total energy consumption and energy consumption per unit of production - As per Annexure 'A' attached.

(B) TECHNOLOGY ABSORPTION

(1) RESEARCH AND DEVELOPMENT:

(a) Specific Areas in which Research and Development carried out by the Company.

Improving product quality. Improving productivity and reducing cost of production.

(b) Future Plan of Action

To continue in house Research & Development activities in the relevant areas.

NEW PRODUCT

The Company has entered into a Joint Venture Agreement with LMT Technology, Germany to manufacture Carbonless Paper & Water Based Inks.

(c) Expenditure on Research & Development

Expenditure on in house Research & Development has been shown under respective heads of expenditure in the Profit and Loss Account as no separate account is maintained.

(2) TECHNOLOGY ABSORPTION, ADAPTION AND INNOVATION:

The Company is constantly interacting with indigenous Raw Material and Machinery suppliers as also with National and International Laboratories / Agencies with a view to absorb and adopt latest technologies in the field of its range of products. The Company has recently entered into an M O U with Phazer Consultancy a group Company of group Phazer Technology, U K regarding Technology transfer of Primer Coated Paper for siliconising and used in Release Paper. This product is alternative to Super Calender Paper.

(C) FOREIGN EXCHANGE EARNINGS AND OUTGO

There has been no direct exports during the year. However, the Company recognize the need for boosting exports and as such continues to explore Overseas markets for its products.

Foreign Exchange Used - NIL

Foreign Exchange Earned - NIL