| Dear Members
The Directors have pleasure in presenting the 21st Annual Report of the
Company together with the audited accounts for the 9th month accounting
period ended 31st, March, 2015
Financial Results (Rs. Lakhs)
Sl. 2014-15 2013-14
Description
No. (9 months) (12 months)
1 Revenue (Net of duties & Taxes) 2365.13 574 8.06
2 Profit/(Loss) before depreciation (11162.74) (9421.32)
& amortization, finance cost and
exceptional items
3 Finance Cost 15.09 249.32
4 Depreciation & Amortization 1163.41 1258.64
5 Exceptional items
- Bad debts written off 19391.54 35147.08
- Deposits written off 538.42 -
- Provision for doubtful advances 2037.16 15963.04
6 Profit/(loss) before tax (2-3-4-5) (34308.36) (62039.40)
7 Provision for tax - -
8 Profit/(loss) after tax (6-7) (34308.36) (62039.40)
Review of operations
Performance during the 9 month accounting period ended 31.03.2015
Your company has made a Revenue of Rs.2365.13 Lakhs during the 9 months
accounting period ended 31st March, 2015, as compared to the turnover
of Rs.5748.06 Lakhs during the 12 month period ended on 30th June 2014
and incurred a net loss of Rs. 34308.36 Lakhs during the 9 months
accounting period as against the net loss of Rs. 62039.40 Lakhs
previous 12 months accounting period ended 30.06.2014. The revenue
collections from the State Electricity Boards has continued to be
decreased drastically on account of non-availability of timely funds
for the completion of the projects., due to bad collections from the
State Electricity Boards and on account of not providing funds by the
banks. Also the decline in the performance is on account of slowdown of
the economy with respect to the Infrastructure Sector. The detailed
analysis of the performance, given at the management's discussion and
analysis section of the Annual Report.
Changes in capital structure
There is no change in the capital structure of the company during the
accounting period.
FCCBs
Out of USD 46 million FCCBs issued by the Company, USD 25 million FCCBs
were converted into equity upon exercise of conversion rights by bond
holders in the earlier years and an amount of USD 21 million FCCBs were
outstanding and due for redemption as at the previous accounting year.
The trustee for FCCB holders has filed suit u/s.433 & u/s.434 of the
Companies Act, 1956 for winding up of the company, which has been
disposed off in Company favour.
Subsidiary
The Company has floated a new India based subsidiary during the year
2011-12, named ICSA Infra Limited. Since it is into inception stage,
there was no transaction in the company during the accounting period.
Dividend
In view of the losses, your Directors decided not to recommend any
dividend for the financial year under review.
Fixed deposits
Your Company has not accepted any deposits falling within the meaning
of Sec. 76 of the Companies Act, 2013 and any other applicable
provision read with the Companies (Acceptance of Deposits) Rules,
during the financial year under review.
Insurance
The Company's properties and assets are adequately insured, wherever
required.
Directors' responsibility statement
As required under Section 134(5) of the Companies Act, 2013 and any
other applicable provisons of the act Directors of your company hereby
state and confirm:
1. That in the preparation of the annual accounts for the 9 months
accounting period ended March 31, 2015, the applicable accounting
standards have been followed along with proper explanation relating to
material departures
2. That We 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
the Company at the 9 months accounting period ended March 31, 2015 and
of the Loss of the Company for the year under review
3. That We have taken proper and sufficient care for maintain of
adequate accounting records in accordance with provisions of the
Companies Act, 1956, for safeguarding the Company's assets and for
preventing and detecting fraud and other irregularities
4. That We have prepared the accounts for the 9 months accounting
period ended March 31, 2015 on a going concern basis
Directors
In accordance with the provisions of Section 160 of the Companies Act,
2013, Mrs. G. Lalitha (DIN 02198243) was appointed as Additional
Director (Woman Director) wef 19th March, 2015 in a duly constituted
Board Meeting. A request has been received by one of the members of
the Company to appoint retires by rotation and being eligible, has
offered himself for reappointment.
Appointment of Secretarial Auditor
Dr. Mohan S Rao, Practising Company Secretary is appointed as a
Secretarial Auditor for the conduct of the Secretarial Audit for the
financial year 2014-15.
Auditors
The appointment of M/s. Rambabu & Co, Chartered Accountants, Hyderabad,
Independent Auditors of the Company retiring at the forthcoming Annual
General Meeting and are being ratified as they were appointed for a
period of five years in the 20th AGM held on 22 Dec 2014. In accordance
with the Companies Act 2013, it is proposed to appoint them for a
period of three consecutive years of the first term of five consecutive
years, subject to the ratification of shareholders at every Annual
General Meeting and M/s. Rambabu & Co, Chartered Accountants,
Hyderabad, have confirmed that the appointment, if made, would be
within the prescribed limits under Section 141 of the Companies Act,
2013.
Response to Auditors Observations
With reference to the observations made by the Statutory Auditors in
the Audit Report, the management response there to as follows:
i) Attention is invited to Note No.7 to Notes on Financial statements
regarding non-provision of interest on working capital loans for an
amount of Rs. 8729.68 lacs. The loss of the company is understated to
an extent of Rs.8729.68 lacs and the liability of the company is
understated to that extent.
Management Response:
The company has been declared sick u/s.3(o) of SICA as per the order
pronounced by the Hon'ble BIFR on 12.02.2014.Later banks have issued
SARFAESI Act 2002 against which Hon'ble BIFR has stayed the actions of
banks.
The company also has given revised DRS proposal to the banks which is
pending. Hence interest is not provided.
ii) Attention is invited to Note No.9 to Notes on Financial statements
regarding non-provision of interest on Term Loans from banks for an
amount of Rs.7,471.83 lacs. The loss of the company is understated to
an extent of Rs.7,471.83 lacs and the liability of the company is
understated to that extent.
Management Response:
The company has been declared sick u/s.3(o) of SICA as per the order
pronounced by the Hon'ble BIFR on 12.02.2014. Later banks have issued
SARFAESI Act 2002 against which Hon'ble BIFR has stayed the actions of
banks.
The company also has given revised DRS proposal to the banks which is
pending. Hence interest is not provided.
iii) Attention is invited to Note No.9 to Notes on Financial statements
regarding non-provision of interest on corporate dividend tax for an
amount of Rs.64.24 lacs which was provided for the financial year
2010-11. The loss of the company is understated to an extent of
Rs.64.24 lacs and the liability of the company is understated to that
extent.
Management Response:
The company has been declared sick u/s.3(o) of SICA as per the order
pronounced by the Hon'ble BIFR on 12.02.2014.Later banks have issued
SARFAESI Act 2002 against which Hon'ble BIFR has stayed the actions of
banks.
The company also has given revised DRS proposal to the banks which is
pending. Hence interest is not provided.
iv) Attention is invited to Note No.25 (a) (iii) to Notes on Financial
statements regarding non-provision of Rs. 6427.58 lacs, towards
differential interest for non acceptance of CDR package by banks. The
loss of the company is understated to an extent of Rs. 6427.58 lacs and
the liability of the company is understated to that extent.
Management Response:
The company has been declared sick u/s.3(o) of SICA as per the order
pronounced by the Hon'ble BIFR on 12.02.2014.Later banks have issued
SARFAESI Act 2002 against which Hon'ble BIFR has stayed the actions of
banks.
The company also has given revised DRS proposal to the banks which is
pending. Hence interest is not provided.
Reference to Board for Industrial and Financial Reconstruction (BIFR)
The Board of Directors at their meeting held on 29th August 2013
approved to make a reference to the Hon'ble Board for Industrial and
Financial Construction (BIFR) u/s.15 Sick Industrial Companies (Special
Provisions) Act, 1985. The information was already placed in the 20th
Annual General Meeting held on 22nd December, 2014. Company has made a
reference to the Hon'ble BIFR on 10th September 2013 and reference has
been registered on 15th October 2013 as case no.70/2013. The company
was declared sick u/s.3(o) of SICA as per the order pronounced by the
Hon'ble BIFR on 12.02.2014.
As per the directions of the Hon'ble BIFR, the company has submitted
the Draft Rehabilitation Package (DRS) to the State Bank of India, the
Operating Agency (OA) and other banks on 25.03.2014.
The OA has appointed the consultant for the study of the TEV, who will
submit the report, after getting the report; the Bankers will have a
joint Lenders Meeting and will forward their recommendations to the
Hon'ble BIFR.
Meanwhile the Banks have issued SARFAESI notice on 16.10.2014; the
Hon'ble BIFR has given stay against the SARFAESI on 27.11.2014.
Employees
During the year under review, none of the employees were in receipt of
remuneration in excess of the limits prescribed under the Section
197(12) of the Companies Act, 2013 and any other applicable provisons
of the act read with rule 5(1) of Companies (Appointment and
remuneration of managerial personal) Rules 2014 as amended.
Listing of Securities
The Company's equity shares are listed with the Bombay Stock Exchange
Ltd. and the National Stock Exchange. The annual listing fee for the
years 2014-15 and 2015-16 have been paid to these exchanges.
Corporate Governance and Shareholders' Information
Your Company has been practicing the principles of good Corporate
Governance over the years and it is a continuous and on-going process.
A detailed Report on Corporate Governance is given as Annexure 'A' to
this Report. Certificate from Practicing Company Secretary confirming
the compliance with conditions of Corporate Governance as stipulated
under clause 49 of the Listing Agreement is attached to this report.
Employee stock options
The time period for schemes of employee stock options has expired and
no shares have been allotted to the employees during the year. As the
time period has expired the Deferred Employee Compensation no longer
required and the same has been reversed to the Reserves.
Management Discussion & Analysis:
Pursuant to the provisions of Clause 49 of the Listing Agreement with
the stock exchange, a report on Management Discussion & Analysis is
attached to this report.
Conservation of energy, technology absorption, foreign-exchange
earnings and outgo
Information as required to be furnished under the provisions of the
Companies (Disclosure of Particulars in the Report of the Board of
Directors) Rules, 1988 are as hereunder:
Conservation of energy
Energy conservation measures taken up:
ICSA uses electrical energy for its equipment such as air-
conditioners, computer terminals, lighting and utilities at work
places. As an on-going process, we continue to undertake the following
measures to conserve energy- - Incorporating new technologies in the
air- conditioning system of the upcoming facilities to optimize power
consumption
- Identifying and replacing low-efficient machinery (AC) in a phased
manner
- Identifying and replacing outdated and low-efficient UPS systems in a
phased manner
The Company also has in place the internal control procedures by which
the cost of the electricity will be identified with the project and
thereby, there will be an incentive for the concerned department to
consume optimum power.
Additional investment and proposals for reduction of consumption of
energy: Nil.
Total energy consumption requirement: Not applicable, as the Company is
not engaged in any of the specified industries specified in Schedule 1
to the Companies (Disclosures of Particulars in the Report of the Board
of Directors) Rules, 1988.
Research and Development
The Company is committed to continue its efforts in Research and
Development. Our Research and Development activities will help us gear
up for future opportunities. We invest and encourage continuous
innovation.
Technology absorption, adoption and innovation
Efforts made in technology absorption: Enclosed - Form 'B
Acknowledgements
Your Directors are thankful to all investors, customers, vendors, banks
and service providers as well as regulatory and government authorities
and other business constituents for their assistance, co-operation,
understanding, support and encouragement. Your Directors also sincerely
appreciate the high degree of professionalism, commitment and
dedication displayed by the employees at all level in the initiatives
of the Company.
By the order of the Board of Directors
for ICSA (INDIA) LIMITED
Sd/-
Place: Hyderabad G. Bala Reddy
Date: 26th August 2015 Chairman-cum-Managing Director |