| The Members,
GSL NOVA PETROCHEMICALS LTD.
(Formerly Known as NOVA PETROCHEMICALS LTD.)
The Directors have pleasure in presenting the 21st Annual Report and
Audited Statement of Accounts for the year ended 31st March 2014.
OPERATIONALS & FINANCIALS The highlights are as under :-
(' In Lacs)
Particulars 2013-14 2012-13
Net Sales & Other Income 717.92 5326.62
Profit / (Loss) before Tax (1130.09) (1305.42)
Less: Provision for Tax Nil Nil
Add : Provision for Deferred Tax Nil Nil
Profit After Taxation/(Loss) (1130.09) (1305.42)
Add: Balance Brought from Previous Year (6846.57) (5541.15)
Profit Available for Appropriations (7976.66) (6846.57)
Less: Appropriations
(a) Dividend Nil Nil
(b) General Reserve Nil Nil
Balance Carried to Balance Sheet (7976.66) (6846.57)
PERFORMANCE:
Your company has achieved Net Sales and Other Income of ' 7.17 crores
as compared to previous year's Net Sales and Other Income of ' 53.26
crores. Due to continuing recession & bad market for Polyester Yarn and
operational loss coupled with non availability of adequate power at
remunerative prices, the production remained suspended since the end of
September, 2012. The net loss during the year under review was placed
at ' 11.30 crores as compared to net loss of ' 13.05 crores for the
previous year..
PRESENT COURSE OF BUSINESS AND OUTLOOK:
The Management's discussion and analysis report, as required under
corporate governance, forming a part of this report, is a reflection of
the current state of business. It also deals with the opportunities and
threats faced by your company and the company outlook.
As, honorable Members are aware that your Company has been facing
severe financial difficulties/Problems due to continuous losses mainly
on account of sluggish market of polyester yarn, creation of large
capacity of POY resulting in to mis-matching of Demand Supply position
of yarn, shortage of working capital funds etc. and also non
operational of polyester Chips Plant since couples of years on account
of obsolete technology and uneconomic size of plant. Moreover
production of POY/FDY had also suspended since the end of
Sepetember,2012 due to aforesaid reasons and also due to non
availability of power at remunerative price.
As the members are also aware that the company had submitted a revival
plan to banks with payment of debts to the extent of Rs 56.50 Crores
through development of affordable housing on surplus land and the
members had given their consent to carry on the above activity/
business as covered under the other objects Clause III (C) 21. However,
the banks have later-on suggested for One Time Settlement (OTS)
considering bleak prospects of servicing the debts through running of
plant and your company has accordingly submitted OTS proposal to all
member banks of the consortium.
SETTLEMENT OF BANKS DUES :
After due deliberation, the banks have agreed to the Company's OTS
proposal and approved the same.
In order to finance the OTS amount, the company has approached Asset
Reconstruction Companies and requested the banks to assign their
financial assistance - Loans sanctioned to the company to JM Financial
Asset Reconstruction Company Pvt. Ltd (JMFARC). Except State bank of
India, all other consortium banks have agreed for the same.
Accordingly Assignment agreements entered into between Bank of Baroda,
UCO Bank and Central Bank of India and JMFARC, for taking over the
existing loan of consortium finance of aforesaid each Bank by JMFARC.
The JMFARC has further agreed to restructure the aforesaid take over
loans.
In order to comply with OTS terms and to repay/settle dues of State
Bank of India and JMFARC in the given time frame, the management of
your company decided to sell Company's Plant and Machinery and also to
develop industrial park, commercial & affordable housing space on the
whole land of the company jointly with reputed builder/agency through
JV, development rights and/or by sale of part of the land. Accordingly
special resolutions are moved through postal ballot notice dated 4th
July,2014.
The prospects for the proposed affordable real estate activity in the
area is quite promising.
DIVIDEND:
Due to loss incurred by the Company during the year 2013-14, your
directors regret their inability to recommend any dividend on the
Equity Share Capital.
DIRECTORS:
Shri Shyam Gupta, Director of the Company, retire by rotation at the
ensuing 21st Annual General Meeting and being eligible for
re-appointment, have offered themselves for the re-appointment. Brief
resume of the Directors and names of companies in which he hold the
Directorship as stipulated under Clause 49 of the Listing Agreement are
given in the notes attached to the Notice calling 21st Annual General
Meeting of the Company.
DIRECTORS' RESPONSIBILITY STATEMENT:
Pursuant to provisions of Section 217 (2AA) of the Companies (Amendment
Act, 2000), Directors' Responsibility Statement is given as under,
(i) That in the preparation of the annual accounts for the financial
year ended 31st March 2014, the applicable accounting standards have
been followed along with proper explanation relating to material
departures.
(ii) That such accounting policies have been selected and applied
consistently and judgments and estimates have been made that are
reasonable and prudent so as to give a true and fair view of the state
of affairs of the Company at the end of the financial year and of the
profit or loss of the Company for the year ended 31st March, 2014.
(iii) That proper and sufficient care has been taken for the
maintenance of adequate accounting records in accordance with the
provisions of the Companies Act, 2013 for safeguarding the assets of
the Company and for preventing and detecting fraud and other
irregularities.
(iv) That the annual accounts have been prepared for the financial year
ended 31st March, 2014 on a going concern basis.
(v) The policies and procedures adopted by the Company for ensuring the
orderly and efficient conduct of its business, including adherence to
company's policies, the safeguarding of its assets, the prevention and
detection of frauds and errors, the accuracy and completeness of the
accounting records and the timely preparation of reliable financial
information.
(vi) The directors had devised proper systems to ensure compliance with
the provisions of all applicable laws and that such systems were
adequate and operating effectively.
INSURANCE:
The Company has adequately covered all assets against all risks.
AUDITORS:
Auditors of the company M/s. J. T. Shah & Co., Chartered Accountants of
Ahmedabad, will retire from the office of the Auditors at the
conclusion of ensuing 21st Annual General Meeting and being eligible,
offer themselves for re-appointment from the conclusion of the ensuing
Annual General Meeting till the conclusion of the next Annual General
Meeting. The Company had pursuant to section 139(1) of the Companies
Act,2013 received a certificate that their appointment, if made , will
be within the limits as laid down in the section.
Explanation to the qualification in Auditors' Report.
The Directors submit their explanation to the qualifications made by
the Auditors in their report for the year 2013-14. The relevant Para
nos. of the report and reply are as under:
9 (b) The delay in the payment of Wealth tax of '5 lacs was due to
demerger since it was based on combined wealth of company prior to
demerger. Now after the demerger the company shall file revised wealth
tax return and pay wealth tax accordingly. Further there is delay in
depositing unpaid/unclaimed dividend into Investor Education and
Protection fund of ' 2.85 lacs due to freezing of unpaid dividend bank
account by government authorities. There is also delay in payment of
Tax deducted at source of ' 14498/-, Gujarat value Added Tax of '
3353/- and Professional Tax of ' 93930/- . The Company has paid part of
the of the dues and is arranging to make the payment of the same.
10. The accumulated losses are more than 50% of net worth of the
Company. The company shall take appropriate actions in consulatation
with the experts.
11. There has been delay in repayment of banks loan installment and
interest beyond 90 days.The banks have already approved OTS for the
settlement of banks dues.Besides above , other notes to the Accounts
are also self explanatory and give suitable explanation to
qualifications in Auditors' Report.
AUDIT COMMITTEE:
During the year under review, the Audit Committee was constituted in
accordance with the provisions of the Companies Act, 2013 and listing
agreement entered into by the Company with the Stock Exchanges.
FIXED DEPOSITS:
During the year under review, the Company has not accepted any deposit
from the public.
CORPORATE GOVERNANCE:
Your Company has complied with the Corporate Governance guidelines as
per Clause 49 of the Listing Agreement with the Stock Exchanges.
A report on Corporate Governance practices followed by your Company, in
terms of Clause 49(VI) of the Listing Agreement and a Certificate from
the Auditors of the company regarding compliance with Corporate
Governance guidelines as stipulated and Management Discussion &
Analysis reports have been attached by way of separate section as part
of this Annual Report.
PARTICULARS OF EMPLOYEES:
There are no employees employed by the Company through out the
financial year or for a part of the financial year who were drawing
remuneration as per the limit provided in section 217(2A) of the
Companies Act, 2013 and therefore there are no details required to be
given in the report.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EARNINGS & OUTGO
:
The particulars prescribed by the companies (Disclosure of Particulars
in the Report of Board of Directors) Rules, 1988 as to conservation of
energy, Technology absorption, Foreign Exchange Earnings and outgo are
furnished in the annexure to this Report.
ACKNOWLEDGEMENT:
Your Directors wish to express their sincere thanks for the support and
co-operation extended by the Bankers of the Company viz. State Bank of
India, Bank of Baroda, UCO Bank, Central Bank of India and CDR
authorities, JM Financial Asset Reconstruction Company Private Limited,
all State and Central Government Departments, Shareholders, valued
Customers and Suppliers etc. of the Company. Your Directors also wish
to express their sincere thanks for the contribution rendered by the
employees of the Company at all levels.
For & on behalf of the Board of Directors,
Sunil kumar Gupta
Date: 14/08/2014 Managing Director
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