FUTURA POLYESTERS LIMITED - IDBI Capital
FUTURA POLYESTERS LIMITED - IDBI Capital
FUTURA POLYESTERS LIMITED - IDBI Capital
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DRAFT LETTER OF OFFER<br />
Dated: July 17, 2008<br />
For Equity Shareholders of the Company only<br />
<strong>FUTURA</strong> <strong>POLYESTERS</strong> <strong>LIMITED</strong><br />
(Originally incorporated as Indian Organic Chemicals Limited on February 10, 1960 under the Companies Act, 1956 vide Certificate of<br />
Incorporation bearing Registration no. 11579 issued by the Registrar of Companies, Mumbai. The name of our Company was changed to<br />
Futura Polyesters Limited vide Fresh Certificate of Incorporation dated November 05, 2002, bearing Registration no. 11-11579. The CIN<br />
(Corporate Identification Number) of our Company is L65192MH1960PLC011579. For details of changes in our Registered Office, please<br />
refer chapter titled “History and Other Corporate Information” beginning on page 54 of the Draft Letter of Offer)<br />
Registered and Corporate Office: Paragon Condominium, 3 rd Floor, Pandurang Budhkar Marg, Mumbai – 400 013, India.<br />
Tel No: +91-22-24922999 Fax No. +91-22-24923142<br />
Contact Person: Mr. S. Ramachandran, Executive Director, President (Legal), Company Secretary and Compliance Officer,<br />
E-mail: rightsissue@futurapolyesters.com Website: www.futurapolyesters.com<br />
FOR PRIVATE CIRCULATION TO THE EQUITY SHAREHOLDERS OF OUR COMPANY ONLY<br />
DRAFT LETTER OF OFFER<br />
ISSUE OF 2,62,10,839 EQUITY SHARES WITH A FACE VALUE OF RS.10/- EACH OF <strong>FUTURA</strong> <strong>POLYESTERS</strong> <strong>LIMITED</strong><br />
(“COMPANY”/”ISSUER”) AT PAR (THAT IS, RS. 10/- EACH) FOR AN AMOUNT AGGREGATING TO RS. 2621.08 LACS ON RIGHTS BASIS<br />
TO THE SHAREHOLDERS OF OUR COMPANY IN THE RATIO OF 1 EQUITY SHARE FOR EVERY 2 FULLY PAID UP EQUITY SHARES<br />
HELD BY THE SHAREHOLDERS ON THE RECORD DATE, I.E. ON [●], 2008 (“ISSUE”)<br />
GENERAL RISKS<br />
Investments in equity and equity related securities involve a degree of risk and investors should not invest any funds in this Issue unless they<br />
can afford to take the risk of losing their investment. Investors are advised to read the Risk Factors carefully before taking an investment<br />
decision in this Issue. For taking an investment decision, investors must rely on their own examination of the Issuer and the Issue including<br />
the risks involved. The securities have not been recommended or approved by the Securities and Exchange Board of India (SEBI) nor does<br />
SEBI guarantee the accuracy or adequacy of this document. Investors are advised to refer to the section titled “Risk Factors” beginning<br />
on page viii of the Draft Letter of Offer before making an investment in this Issue.<br />
ISSUER’S ABSOLUTE RESPONSIBILITY<br />
The Issuer, having made all reasonable inquiries, accepts responsibility for and confirms that the Draft Letter of Offer contains all<br />
information with regard to the Issuer and the Issue, which is material in the context of this Issue, that the information contained in the Draft<br />
Letter of Offer is true and correct in all material aspects and is not misleading in any material respect, that the opinions and intentions<br />
expressed herein are honestly held and that there are no other facts, the omission of which makes the Draft Letter of Offer as a whole or any<br />
such information or the expression of any such opinions or intentions misleading in any material respect.<br />
LISTING<br />
The existing Equity Shares of our Company are listed on Bombay Stock Exchange Limited (“BSE”). Our Company has received in-principle<br />
approval from BSE by its letter dated [●] granting in-principle approval for listing the Equity Shares arising from this Issue. For the purpose<br />
of this Issue, the Designated Sock Exchange is BSE.<br />
LEAD MANAGER TO THE ISSUE<br />
REGISTRAR / SHARE TRANSFER AGENT TO THE ISSUE<br />
<strong>IDBI</strong> <strong>Capital</strong> Market Services Limited<br />
5 th Floor, Mafatlal Centre,<br />
Nariman Point,<br />
Mumbai – 400 021, India<br />
Tel.: +91-22-2289 7519/37<br />
Fax: +91-22-2283 8782<br />
E-Mail: futura.rights@idbicapital.com<br />
Website: www.idbicapital.com<br />
Investors Grievance ID: redressal@idbicapital.com<br />
Contact Person: Mr. Neelabh Dubey<br />
SEBI Registration No: INM000010866<br />
Satellite Corporate Services Private Limited<br />
B- 302, Sony Apt., Opposite St. Jude's High School,<br />
Off. Andheri-Kurla Road, Jarimari,<br />
Sakinaka, Mumbai – 400072, India<br />
Tel: +91-22-28520461/28520462.<br />
Fax: +91-22-28511809.<br />
E-mail: service@scspl.net<br />
Website: www.scspl.com<br />
Contact Person: Mr. Michael Monterio<br />
SEBI Registration No.: INR000003639<br />
ISSUE PROGRAMME<br />
ISSUE OPENS ON<br />
LAST DATE FOR<br />
ISSUE CLOSES ON<br />
REQUEST FOR<br />
SPLIT APPLICATION<br />
FORMS<br />
[●] [●] [●]
TABLE OF CONTENTS<br />
SECTION I – DEFINITIONS AND ABBREVIATIONS ............................................................................................................................... I<br />
DEFINITIONS AND ABBREVIATIONS .......................................................................................................................................................... I<br />
NO OFFER IN OTHER JURISDICTIONS ........................................................................................................................................................V<br />
CERTAIN CONVENTIONS - PRESENTATION OF FINANCIALS..............................................................................................................VI<br />
AND USE OF MARKET DATA.......................................................................................................................................................................VI<br />
SECTION II – RISK FACTORS..................................................................................................................................................................VII<br />
FORWARD LOOKING STATEMENTS........................................................................................................................................................ VII<br />
RISK FACTORS.............................................................................................................................................................................................VIII<br />
SECTION III - INTRODUCTION...................................................................................................................................................................1<br />
SUMMARY.........................................................................................................................................................................................................1<br />
THE ISSUE..........................................................................................................................................................................................................4<br />
SUMMARY STATEMENT OF FINANCIAL INFORMATION .......................................................................................................................5<br />
GENERAL INFORMATION ..............................................................................................................................................................................8<br />
CAPITAL STRUCTURE...................................................................................................................................................................................12<br />
OBJECTS OF THE ISSUE................................................................................................................................................................................21<br />
BASIS FOR ISSUE PRICE ...............................................................................................................................................................................24<br />
SECTION IV – ABOUT US ............................................................................................................................................................................29<br />
INDUSTRY OVERVIEW .................................................................................................................................................................................29<br />
BUSINESS OVERVIEW...................................................................................................................................................................................32<br />
FINANCIAL INDEBTEDNESS........................................................................................................................................................................46<br />
HISTORY AND OTHER CORPORATE INFORMATION .............................................................................................................................54<br />
OUR MANAGEMENT .....................................................................................................................................................................................61<br />
OUR PROMOTERS ..........................................................................................................................................................................................75<br />
OUR PROMOTER GROUP ENTITIES............................................................................................................................................................77<br />
RELATED PARTY TRANSACTIONS ..........................................................................................................................................................110<br />
DIVIDEND POLICY.......................................................................................................................................................................................111<br />
SECTION V – FINANCIAL STATEMENTS .............................................................................................................................................112<br />
FINANCIAL INFORMATION .......................................................................................................................................................................114<br />
MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS ........................139<br />
SECTION VI – LEGAL AND OTHER INFORMATION .........................................................................................................................155<br />
OUTSTANDING LITIGATIONS, MATERIAL DEVELOPMENTS AND OTHER DISCLOSURES .........................................................155<br />
GOVERNMENT/ STATUTORY APPROVALS ............................................................................................................................................200<br />
SECTION VII – OTHER REGULATORY AND STATUTORY DISCLOSURES .................................................................................210<br />
TERMS OF THE ISSUE .................................................................................................................................................................................221<br />
SECTION VIII: ARTICLES OF ASSOCIATION OF THE COMPANY ................................................................................................245<br />
SECTION IX – OTHER INFORMATION..................................................................................................................................................285<br />
MATERIAL CONTRACTS AND DOCUMENTS FOR INSPECTION.........................................................................................................285<br />
DECLARATION .............................................................................................................................................................................................286
SECTION I – DEFINITIONS AND ABBREVIATIONS<br />
DEFINITIONS AND ABBREVIATIONS<br />
In the Draft Letter of Offer, the terms “we”, “us”, “our”, “the Company”, “our Company” or “FPL”, unless the<br />
context otherwise implies, refer to Futura Polyesters Limited. All references to “Rs.”or “INR” refer to Rupees, the<br />
lawful currency of India, “USD” or “US$” refer to the United States Dollar, the lawful currency of the United States<br />
of America, references to the singular also refers to the plural and one gender also refers to any other gender,<br />
wherever applicable, and the words “Lakh” or “Lac” means“100 thousand” and the word “million” or “mn” means<br />
“10 lakh” and the word “crore” means “10 million” or “100 lakhs” and the word “billion” means “1,000 million” or<br />
“100 crores”. Any discrepancies in any table between the total and the sums of the amounts listed are due to<br />
rounding off.<br />
Term<br />
“The Issuer” or “The Company” or<br />
“Futura Polyesters Limited” or “Futura”<br />
or “FPL” “We” or “Us” or “our<br />
Company”<br />
Subsidiary<br />
Promoters<br />
Promoter Group Entities<br />
Description<br />
Unless otherwise specified, these references mean Futura Polyesters<br />
Limited, a public limited company incorporated under the Companies<br />
Act, 1956<br />
Innovassynth Investments Limited<br />
Mr. Shyam Bhupatirai Ghia and Mr. Mukund Dharamadas Dalal<br />
Unless the context otherwise requires, refers to those companies/entities<br />
mentioned in the section titled, “Our Promoter Group”<br />
Abbreviations<br />
Abbreviation<br />
Full Form<br />
AGM Annual General Meeting<br />
BSE Bombay Stock Exchange Limited<br />
C&FA Clearing and Forwarding Agents.<br />
CAF Composite Application Form<br />
CAGR Compounded Annual Growth Rate<br />
CEO Chief Executive Officer<br />
CDSL Central Depository Services (India) Limited<br />
CIN<br />
Company Identification Number<br />
DIN Directors Identification Number<br />
DP<br />
Depository Participant<br />
DC<br />
Distribution Centres<br />
ECS Electronic Clearing Service<br />
EGM Extraordinary General Meeting<br />
EOU Export Oriented Unit<br />
EPS<br />
Earning Per Share<br />
ESOP Employee Stock Option Plan<br />
ESPS` Employee Stock Purchase Scheme<br />
FDA Food & Drug Administration<br />
FDI<br />
Foreign Direct Investment<br />
FEMA Foreign Exchange Management Act, 1999<br />
FII(s) Foreign Institutional Investors registered with SEBI under applicable laws<br />
FIPB Foreign Investment Promotion Board, Ministry of Finance, Government of India<br />
GAAP Generally Accepted Accounting Principles<br />
GoI<br />
Government of India.<br />
HR<br />
Human Resources.<br />
HUF Hindu Undivided Family.<br />
ICAI Institute of Chartered Accountants of India.<br />
IT<br />
Information Technology.<br />
IMF International Monetary Fund<br />
ISIN International Securities Identification Number<br />
ISO<br />
Indian Standard Organisation<br />
i
MD<br />
MIS<br />
MoU<br />
NAV<br />
NGO<br />
NEFT<br />
NOC<br />
NR<br />
NRI(s)<br />
NSDL<br />
PAN<br />
RBI<br />
RoC<br />
RTGS<br />
SEBI<br />
USA / US<br />
Managing Director.<br />
Management Information Systems.<br />
Memorandum of Understanding.<br />
Net Asset Value.<br />
Non-Governmental Organisation.<br />
National Electronic Funds Transfer<br />
No Objection Certificate.<br />
Non Resident.<br />
Non Resident Indian(s).<br />
National Securities Depository Limited.<br />
Permanent Account Number.<br />
The Reserve Bank of India.<br />
The Registrar of Companies, Maharashtra, Mumbai at 100, Everest Building,<br />
Marine Drive, Mumbai – 400 002, Maharashtra, India.<br />
Real Time Gross Settlement<br />
Securities and Exchange Board of India.<br />
United States of America<br />
General Terms / Issue Related Terms<br />
Term<br />
Definition<br />
Act<br />
The Companies Act, 1956 and amendments thereto from time to time.<br />
Articles<br />
Articles of Association of our Company.<br />
Auditors<br />
Refers to M/s. N. M. Raiji & Co<br />
Bankers to the Issue [●]<br />
Board or Board of Board of Directors of Our Company or a Committee(s) thereof.<br />
Directors<br />
Designated Stock BSE.<br />
Exchange/Stock<br />
Exchange<br />
Draft Letter of Offer Draft Letter of Offer circulated to the Shareholders of our Company.<br />
Equity Share(s) or Equity Shares of our Company which are listed on BSE<br />
Share(s)<br />
Equity Shareholders Investors holding the Equity Shares of our Company.<br />
Fiscal/FY Financial Year ending March 31.<br />
Indian GAAP Generally Accepted Accounting Principles in India.<br />
Investor (s)<br />
Means the holder(s) of the Equity Shares of our Company as on the Record Date i.e. [●] and<br />
Renouncees.<br />
Issue<br />
Issue of 2,62,10,839 Equity Shares with a face value of Rs. 10/- each of our Company at par<br />
(that is, Rs. 10/- each) for an amount aggregating to Rs. 2621.08 lacs on rights basis to the<br />
existing shareholders of our Company in the ratio of one Equity Share for every two fully<br />
paid Equity Shares held by the shareholders on the Record Date, that is on [●], 2008. For<br />
more details, please refer chapter titled “Terms of the Issue” beginning on page 221 of the<br />
Draft Letter of Offer.<br />
Issue Closing Date [●]<br />
Issue Opening Date [●]<br />
Issue Price<br />
Rs. 10/- at par with the face value<br />
IT Act<br />
The Income Tax Act, 1961 and amendments thereto.<br />
Lead Manager <strong>IDBI</strong> <strong>Capital</strong> Market Services Limited<br />
Letter of Offer Letter of Offer circulated to the Shareholders of Our Company.<br />
Memorandum Memorandum of Association of our Company.<br />
Promoter Directors Mr. Shyam Bhupatirai Ghia and Mr. Mukund Dharamdas Dalal<br />
Record Date<br />
[●]<br />
Registrar to the Issue Satellite Corporate Services Private Limited<br />
or Registrar / Transfer<br />
Agent<br />
ii
Renouncees<br />
Rights Entitlement<br />
Rights Issue<br />
SEBI Act, 1992<br />
SEBI (DIP)<br />
Guidelines, 2000<br />
Takeover Code<br />
The persons who have acquired Rights Entitlements from Equity Shareholders.<br />
The number of Equity Shares that a shareholder of our Company is entitled to in proportion<br />
to his/her existing shareholding in our Company as on Record Date.<br />
The issue of Equity Shares on rights basis based on terms of the Draft Letter of Offer / Letter<br />
of Offer.<br />
Securities and Exchange Board of India Act, 1992 and amendments thereto.<br />
The Guidelines for Disclosure and Investor Protection issued by SEBI on January 19, 2000<br />
read with amendments issued thereafter from time to time till the date of filing of the Draft<br />
Letter of Offer with SEBI.<br />
The SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 1997 as amended<br />
to date.<br />
Company / Industry Related Terms<br />
Term<br />
ADD<br />
ASP<br />
BDO<br />
BHET<br />
CO 2<br />
Co-PET<br />
CPET<br />
CSD<br />
DMT<br />
DSIR<br />
FIL<br />
FPL<br />
FRH<br />
GDP<br />
HDPE<br />
IPA<br />
IPP<br />
LDPE<br />
LLDPE<br />
MEG<br />
MT<br />
NDC<br />
O 2<br />
OGL<br />
PBN<br />
PBT<br />
PCRPET<br />
PCT<br />
PCTG<br />
PDO<br />
PE<br />
PEN<br />
PET<br />
PETG<br />
PP<br />
PPT<br />
PS<br />
PSF<br />
PTA<br />
PTN<br />
PTT<br />
POY<br />
Definition<br />
Anti-dumping Duty<br />
Activated Sludge Process<br />
Butanedoil<br />
Bis Hydroxy Ethylene Terepthalate<br />
Carbon dioxide<br />
Co-Polymer PET<br />
Crystalline Thermoplastic Polyester Resin<br />
Carbonated Soft Drinks<br />
Dimethyl Terephthalate<br />
Department of Scientific and Industrial Research<br />
Futura Industries Limited<br />
Futura Polyesters Limited<br />
Fast Re-heat<br />
Gross Domestic Product<br />
High Density Polyethelene<br />
Isophthalic Acid<br />
Independent Power Producer<br />
Low Density Polyethelene<br />
Linear Low Density Polyethelene<br />
Mono Ethylene Glycol<br />
Metric Tonne<br />
Dimethyl 2.6 Naphtalene<br />
Oxygen<br />
Open General License<br />
Polybutylene Napthalate<br />
Polybutylene Terephthalate<br />
Post Consumer Recycle PET<br />
Polycyclohexylene dimethylene Terephthalate<br />
Poly Cyclohexylne Dimethylene Terepthalate Glycol Modify<br />
Propandoil<br />
Polyethylene<br />
Polyethylene Naphthalate<br />
Polyethylene Terephthalate<br />
Poly Ethylene Terepthalate Glycol modify<br />
Polypropylene<br />
Poly Propylene Terephthalate<br />
Polystyrene<br />
Polyester Staple Fibre<br />
Purified Terephthalic Acid<br />
Polytrimethylene Napthalate<br />
Poly Trimethylene Terephthalate<br />
Polyester Filament Yarn<br />
iii
PVC<br />
RIL<br />
R&D<br />
SSP<br />
Scheme of<br />
Arrangement<br />
THF<br />
TNEB<br />
Polyvinyl Chloride<br />
Reliance Industries Limited<br />
Research and Development<br />
Solid State Polymerisation<br />
Scheme of Arrangement under Sections 391 to 394 of the Companies Act, 1956 pursuant to which<br />
there shall be a transfer of our holding of 2,38,50,070 equity shares in Innovassynth Technologies<br />
(India) Limited to Innovassynth Investments Limited, and the shareholders of our Company shall be<br />
entitled to receive five Equity Shares in Innovassynth Investments Limited for every eleven equity<br />
shares held in our Company on the record date fixed for the purposes of determining entitlement of<br />
shareholders under the said Scheme.<br />
Tetrahydrofuran<br />
Tamil Nadu Electricity Board<br />
Notwithstanding the foregoing,<br />
(i)<br />
(ii)<br />
(iii)<br />
In the section titled ‘Articles of Association of the Company’ beginning on page 245 of the Draft Letter of<br />
Offer, defined terms shall have the meaning given to such terms in that section;<br />
In the chapters titled ‘Financial Statements’ and ‘Statement of Tax Benefits” beginning on pages 112 and<br />
26 of the Draft Letter of Offer, defined terms shall have the meaning given to such terms in those<br />
chapters;<br />
In the paragraph titled ‘Disclaimer Clause of Bombay Stock Exchange Limited’ beginning on page 212 of<br />
the Draft Letter of Offer, defined terms shall have the meaning given to such terms in that paragraph.<br />
iv
NO OFFER IN OTHER JURISDICTIONS<br />
The Rights Entitlement and the receipt of the Draft Letter of Offer will not constitute an offer in those jurisdictions<br />
in which it would be illegal to make such an offer and, in those circumstances, the Draft Letter of Offer must be<br />
treated as sent for information only and should not be copied or redistributed. Accordingly, persons receiving a copy<br />
of the Draft Letter of Offer should not, in connection with the Issue of Equity Shares or the Rights Entitlement,<br />
distribute or send the same in or into any other jurisdiction where to do so would or might contravene local<br />
securities laws or regulations. If the Draft Letter of Offer is received by any person in any such territory, or by their<br />
agent or nominee, they may not seek to subscribe to the Equity Shares or the Rights Entitlement referred to in the<br />
Draft Letter of Offer and if they choose to do, they will be doing it at their own risk, cost and consequence, and our<br />
Company shall not be liable in this regard.<br />
v
CERTAIN CONVENTIONS - PRESENTATION OF FINANCIALS<br />
AND USE OF MARKET DATA<br />
Unless stated otherwise, the financial data in the Draft Letter of Offer is derived from our restated financial<br />
statements for the year ended March 31, 2008 and for the years ended March 31, 2007; 2006; 2005; and 2004;<br />
prepared in accordance with Indian GAAP and the Companies Act and restated in accordance with SEBI Guidelines,<br />
as stated in the report of our statutory Auditors, M/s. N. M. Raiji & Co in the chapter titled “Financial Information”<br />
beginning on page 114 of the Draft Letter of Offer.<br />
Our fiscal year commences on April 01 and ends on March 31 of a particular year. Unless stated otherwise,<br />
references herein to a fiscal year (e.g., fiscal 2008), are to the fiscal year ended March 31 of a particular year.<br />
In the Draft Letter of Offer, any discrepancies in any table between the total and the sum of the amounts listed are<br />
due to rounding-off.<br />
All references to “India” contained in the Draft Letter of Offer are to the Republic of India.<br />
All references to “Rupees” or “Rs.” or “INR” are to Indian Rupees, the official currency of the Republic of India.<br />
Market Data<br />
Market and industry data used throughout the Draft Letter of Offer has been obtained from publications (including<br />
websites) available in public domain and internal Company reports. These publications generally state that the<br />
information contained in those publications has been obtained from sources believed to be reliable but that their<br />
accuracy and completeness are not guaranteed and their reliability cannot be assured. Although we believe that the<br />
market data used in the Draft Letter of Offer is reliable, it has not been independently verified. Similarly, internal<br />
Company reports, while believed to be reliable, have not been verified by any independent source.<br />
vi
SECTION II – RISK FACTORS<br />
FORWARD LOOKING STATEMENTS<br />
We have included statements in the Draft Letter of Offer which contain words or phrases such as “will”, “may”,<br />
“aim”, “is likely to result”, “believe”, “expect”, “will continue”, “anticipate”, “estimate”, “intend”, “plan”,<br />
“contemplate”, “seek to”, “future”, “objective”, “goal”, “project”, “should”, “will pursue” and similar expressions or<br />
variations of such expressions, that are “forward-looking statements”.<br />
All forward looking statements are subject to risks, uncertainties and assumptions about us that could cause actual<br />
results to differ materially from those contemplated by the relevant forward-looking statement. Important factors<br />
that could cause actual results to differ materially from our expectations include but are not limited to:<br />
• General economic and business conditions in the markets in which we operate and in the local, regional,<br />
national and international economies;<br />
• Changes in laws and regulations relating to the sectors/areas in which we operate;<br />
• Increased competition in the sectors/areas in which we operate;<br />
Our ability to successfully implement our growth strategy and expansion plans, and to successfully launch and<br />
implement various projects and business plans for which funds are being raised through this Issue;<br />
• Our ability to meet our capital expenditure requirements;<br />
• Fluctuations in operating costs;<br />
• Our ability to attract and retain qualified personnel;<br />
• Changes in technology;<br />
• Changes in political and social conditions in India or in countries that we may enter, the monetary and<br />
interest rate policies of India and other countries, inflation, deflation, unanticipated turbulence in interest<br />
rates, equity prices or other rates or prices;<br />
• The performance of the financial markets in India and globally; and<br />
• Any adverse outcome in the legal proceedings in which we are involved.<br />
Neither we, our Directors, the Lead Manager, nor any of their respective affiliates have any obligation to update or<br />
otherwise revise any statements reflecting circumstances arising after the date hereof or to reflect the occurrence of<br />
underlying events, even if the underlying assumptions do not come to fruition. In accordance with SEBI<br />
requirements, our Company, the Lead Manager will ensure that investors in India are informed of material<br />
developments until such time as the grant of listing and trading permission by the Stock Exchange for the Equity<br />
Shares being offered on a rights basis.<br />
For a further discussion of factors that could cause our actual results to differ, see the chapters titled “Risk Factors”<br />
“Business Overview” and “Management Discussion and Analysis of Financial Condition and Results of Operations”<br />
beginning on pages viii, 32 and 139 of the Draft Letter of Offer respectively. By their nature, certain market risk<br />
disclosures are only estimates and could be materially different from what actually occurs in the future. As a result,<br />
actual future gains or losses could materially differ from those that have been estimated.<br />
vii
RISK FACTORS<br />
An investment in Equity Shares involves a high degree of risk. You should carefully consider all the information in<br />
the Draft Letter of Offer, including the risks and uncertainties described below, before making an investment in our<br />
Equity Shares. If any of the following risks actually occur, our business, results of operations and financial<br />
condition could suffer, the price of our Equity Shares could decline, and you may lose all or part of your investment.<br />
The financial and other implications of material impact of risks concerned, wherever quantifiable, have been<br />
disclosed in the risk factors mentioned below. However there are a few risk factors where the impact is not<br />
quantifiable and hence the same has not been disclosed in such risk factors.<br />
The Draft Letter of Offer also includes statistical and other data regarding the Indian Manufacturing Industry. This<br />
data was obtained from industry publications, reports and other sources that we and the Lead Manager believe to<br />
be reliable. Neither we nor the Lead Manager have independently verified such data.<br />
Internal Risk Factors:<br />
1. Our Company is involved in certain legal proceedings which could render us liable to liabilities/penalties and<br />
have a material adverse effect on our business and profitability. We have also paid some penalties in the past<br />
Our Company is involved in certain legal proceedings and claims in relation to certain civil, labour, criminal<br />
and taxation matters incidental to our business and operations. These legal proceedings are pending at different<br />
levels of adjudication before various courts and tribunals. Any adverse decision may render us liable to<br />
liabilities/penalties and may adversely affect our business and results of operations. A classification of these<br />
legal and other proceedings instituted against and by our Company is given in the following table:<br />
Type of Legal Proceedings Total number of pending cases Financial<br />
Implications*<br />
Civil 19 Rs. 492 Lacs and USD<br />
6,03,330<br />
Criminal 4 Rs. 44.69 Lacs<br />
Labour 9 Rs. 0.80 Lacs<br />
Tax 58 Rs. 3677.08 lacs<br />
(**excluding Income<br />
Tax cases)<br />
Penalties imposed in the past five years on our Company:<br />
Sr. Amount of Brief particulars regarding penalty Remarks (paid/<br />
No. penalty<br />
payable and<br />
imposed (Rs.)<br />
reasons therefore)<br />
1. Rs. 19,325 Penalty of Rs. 19,325 imposed in the Assessment Year 2005-2006 Paid<br />
by the Commercial Tax Officer, for late payment of monthly sales<br />
tax under the provisions of the Tamil Nadu General Sales Tax Act,<br />
1959.<br />
2. Rs. 21,126 Penalty of Rs. 21,126 imposed in the Assessment Year 2005-2006<br />
by the Commercial Tax Officer for late payment of sales tax under<br />
provisions of the Central Sales Tax Act, 1956 read with Tamil<br />
Nadu General Sales Tax Act, 1959.<br />
Paid<br />
* The amount(s) disclosed in the above tables are the amount(s) expressly claimed, being the liability and financial<br />
impact which may be incurred if unsuccessful in legal proceedings. However, it does not include those penalties,<br />
interests and costs, if any, which may be imposed which may have been pleaded but not quantified in the course of<br />
legal proceedings, or which the Court/Tribunal otherwise has the discretion to impose. The imposition and amount<br />
of such penalties/interests/costs are at the discretion of the court/tribunal where the case is pending. Such liability, if<br />
any, would crystallize only on the order of the court/tribunal where the case(s) is/are pending.<br />
viii
**The amount involved in the income tax cases is Rs. 14,895.75 Lacs representing the allowance/disallowance of<br />
expenses or addition/deduction of income or penalties challenged. The actual tax liability would depend on the<br />
relevant demand for each assessment year, which would depend on the tax rates, interest, if any, payable and<br />
penalty, if any, leviable for that assessment year.<br />
For further details regarding the aforesaid litigations, please refer chapter titled “Outstanding Litigations, Material<br />
Developments and Other Disclosures” beginning on page 155 of the Draft Letter of Offer.<br />
2. Certain legal proceedings have been initiated against our Promoter Group Entities.<br />
Certain legal proceedings have been initiated and claims made against our Promoter Group Entities. These<br />
proceedings are pending at different levels of adjudication before various courts and tribunals. Any adverse<br />
decision may render them liable to liabilities/penalties and may adversely affect their business and results of<br />
operations. A classification of legal proceedings against our Promoter Group Entities is given in the following<br />
table:<br />
Type of Legal Total number of Financial Implications*<br />
Proceedings<br />
pending cases<br />
Civil 33 Rs. 11,844.83 Lacs<br />
Criminal 2 Nil<br />
Labour 17 Rs. 258.62 Lacs<br />
Tax** 20 Rs. 539.94 Lacs (excluding income tax cases for entities<br />
stated hereinbelow)<br />
* The amount(s) disclosed in the above tables are the amount(s) expressly claimed, being the liability and financial<br />
impact which may be incurred if unsuccessful in legal proceedings. However, it does not include those penalties,<br />
interests and costs, if any, which may be imposed which may have been pleaded but not quantified in the course of<br />
legal proceedings, or which the Court/Tribunal otherwise has the discretion to impose. The imposition and amount<br />
of such penalties/interests/costs are at the discretion of the court/tribunal where the case is pending. Such liability, if<br />
any, would crystallize only on the order of the court/tribunal where the case(s) is/are pending.<br />
**The amount of these aforesaid cases is detailed below, representing the allowance/disallowance of expenses or<br />
addition/deduction of income. The actual tax liability would depend on the relevant demand for each assessment<br />
year, which would depend on the tax rates, interest, if any, payable and penalty, if any, leviable for that assessment<br />
year.<br />
1. Hathway Investment Private Limited : Rs. 1073.08 Lacs<br />
2. Outlook Publishing (India) Private Limited : Rs. 16.6 Lacs<br />
3. Bhupati Investments & Finance Private Limited : Rs. 46.31 Lacs<br />
For further details regarding the aforesaid litigations, please refer chapter titled “Outstanding Litigations, Material<br />
Developments and Other Disclosures” beginning on page 155 of the Draft Letter of Offer.<br />
3. Our Directors/Promoters are involved in certain legal proceedings.<br />
Our Directors/Promoters are involved in certain legal proceedings, which if determined against them, could have<br />
an adverse effect on them. A classification of these legal proceedings is as follows:<br />
Name of Director/Promoter Type of Proceedings Financial Implication<br />
Mr. Shyam Bhupatirai Ghia 1 civil case<br />
Civil case- Rs. 7.5 lacs<br />
Mr. Mukund Dharamdas Dalal<br />
1 show cause notice under<br />
Foreign Trade (Development<br />
and Regulation) Act, 1992<br />
2 civil cases<br />
1 show cause notice under<br />
Foreign Trade (Development<br />
Show cause notice- Not<br />
quantifiable.<br />
Civil cases- Rs. 7.5 lacs – one<br />
case not quantifiable<br />
Show cause notice- Not<br />
ix
Mr. Sharad Shreepad Marathe<br />
Mr. Nikhil Shyam Ghia<br />
and Regulation) Act, 1992<br />
1 show cause notice under<br />
Foreign Trade (Development<br />
and Regulation) Act, 1992<br />
1 show cause notice under<br />
Foreign Trade (Development<br />
and Regulation) Act, 1992<br />
quantifiable.<br />
Not quantifiable<br />
Not quantifiable<br />
4. Approximately 73 % of our revenue is derived from our 10 top clients. Loss of any one or more of these<br />
clients may adversely affect our business<br />
The revenues from our top 10 customers constitute approximately 73% of our total revenue. These customers<br />
procure polyester, polymer and preforms from our Company. Our Company has done business with these<br />
customers for a considerable time period. Any change in the buying pattern of these clients which is adverse to<br />
our Company, including due to deterioration in our quality standards or decline in the level of our commitment,<br />
may have an adverse impact on our client retention ability. The loss of major customers may have a material<br />
adverse affect our financial condition and results of operations. .<br />
3. We have contingent liabilities as on March 31, 2008.<br />
As on March 31, 2008, contingent liabilities not provided for were as follows:<br />
(Rs. in Lacs)<br />
Particulars<br />
As on March<br />
31, 2008<br />
Claims against the Company not acknowledged as debts 173.40<br />
Service Tax: - Penalty and interest demanded on technology transfer agreement between FPL 486.00<br />
and IOCL and vice versa. ST demand on goods transport service at Supreme Court<br />
Service Tax demand on Goods Transport Agency during the year 1997-98, departments 6.29<br />
appeals pending in Supreme Court<br />
Service tax credit denial on outward freight and canteen services 2005-06, 06-07 and 07-08 63.84<br />
Central Excise – Claims against the company on various issues pending at CESTAT / High 493.49<br />
Court / Supreme Court<br />
Customs: Methods of calculation of duty under notification 2 / 95 & other valuation issues 126.33<br />
Sales tax on Input use for Exports (1999-2000 and 2000-2001) 9.00<br />
Sales Tax on interest collected (1997-98 & 2000-01) CST levied in interest charges collected 4.40<br />
from customers<br />
Guarantee given by the Company 2813.00<br />
Total 4175.75<br />
4. Our applications for registration/renewal of registration of some of our trademarks and grant of patents are<br />
pending with the relevant authorities<br />
Our Company has applied for the registration/renewal of registration of certain trademarks under the<br />
Trademarks Act, 1999, and for patents both in India and outside India.Our Company cannot assure that it would<br />
be granted the trademarks/patents that it has applied for, or that the grant of the same would not be challenged<br />
by third parties. Any such challenge by third parties, or proceedings by us to protect our intellectual property,<br />
may entail significant time and cost commitments, and our Company cannot assure that it would be successful<br />
in such defence/proceedings, which would entail adverse financial implications. Loss of critical intellectual<br />
property (especially patents) would have a material adverse effect on our business, results of operations and<br />
financial condition.<br />
5. Our business plans may need substantial capital and additional financing in the form of debt and/or equity to<br />
meet our requirements.<br />
Our business requires a substantial amount of working capital. In many cases, working capital is required to<br />
finance the purchase of raw materials. Our working capital requirements may increase if, in certain contracts,<br />
payment terms do not provide for advance payments to us or if payment schedules are less favorable to us. Our<br />
x
Company may need additional financing in the future in the form of debt and/or equity to fulfill our working<br />
capital needs. Continued increases in working capital requirements may have an adverse effect on our financial<br />
condition and results of operations.<br />
6. If our Company is unable to attract and retain key employees, our operations could be adversely affected.<br />
Our business substantially depends on the continued service of our key managerial personnel. The loss of the<br />
services of our key managerial personnel could have a material adverse effect on us. Our future success will<br />
also depend on our ability to attract highly skilled personnel, such as engineering, project management and<br />
senior management professionals. Our Company could experience difficulty from time to time in hiring the<br />
personnel necessary to support our business. If our Company does not succeed in attracting new high quality<br />
employees, our reputation may be adversely impacted and our future earnings may be negatively impacted.<br />
7. Increase in the cost of raw materials, particularly petroleum-based raw materials, have put pressure on our<br />
margins and could have a material adverse impact on our financial condition and results of operations.<br />
Production of polyesters fibre, performs and PET requires raw materials which are procured from petroleumbased<br />
products. The cost of raw materials consumed by our Company constituted approximately 53.9% of our<br />
Company’s net sales for FY 2008 and approximately 57.2% of our Company’s net sales for FY 2007. Constant<br />
increase in the price of crude oil in the international market, specially in the last couple of years, has a direct<br />
impact on our cost of manufacturing. Any increase in the cost of the raw materials can adversely impact our<br />
profit margins if our Company is unable to pass on the increased cost on to our customers. Further, even if we<br />
are able to pass on the increase in raw material prices to our customers, this may reduce the demand for our<br />
products. To the extent that our Company uses virgin raw material (vis-à-vis recycled raw material), this<br />
consequent volatility in the price of raw materials may have a material adverse impact on our business, financial<br />
condition and results of operations.<br />
8. The demand for PSF is substantially dependent on the prices of other fibres (primarily cotton), and reduction<br />
in prices of other fibres may adversely affect PSF demand.<br />
One of our key products is PSF, which accounted for 41.42% and 46.69% of our sales in FY 2007 and FY 2008<br />
respectively. PSF is primarily used in the textile industry, and is blended with other fibres (including cotton) in<br />
textile production. The blending percentage in the textile industry depends, in part, upon the prices of the<br />
respective fibres used in the blend. Any fall in the prices of other fibres (primarily cotton), on account of excess<br />
production or otherwise, may lead to reduction of percentage of PSF in the blends, thereby adversely affecting<br />
the demand for PSF, which would have a material adverse effect on our turnover, and consequently on our<br />
business, results of operations and financial condition.<br />
9. The Registered and Corporate Office of our Company is not owned by us<br />
The Registered and Corporate Office of our Company is not owned by us, and has been taken on lease by us,<br />
which is currently valid till January 25, 2009. The rent payable for the occupation of this premises is Rs.<br />
2,22,250 per month. We cannot assure that this lease would be renewed at all, or would be renewed on terms<br />
and conditions (including rent) which would be acceptable to us. In the event of non-renewal, we may have to<br />
shift to another premises, which may lead to higher rent/maintenance outgo, and lead to a temporary disruption<br />
in operations till the shifting is complete. Any increase in rent/expenses in this regard could have a material<br />
adverse effect on its financial condition and results of operations.<br />
10. Some of our Promoter Group Companies have incurred losses in last three years.<br />
Some of our Promoter Group Companies have incurred losses during last three years, as set forth in the table<br />
below:<br />
Name of the Company<br />
Brahmasonic Sound<br />
Production Private Limited<br />
(Rs. in lacs)<br />
Financial Performance Financial Performance Financial Performance<br />
as on March 31, 2005 as on March 31, 2006 as on March 31, 2007<br />
Profit After Tax Profit After Tax Profit After Tax<br />
(1.35) (0.93) (0.48)<br />
xi
Chika Overseas Private<br />
Limited<br />
Crescent Property<br />
Developers Private Limited<br />
Sea Side Exports Private<br />
Limited<br />
Prerna Builders Private<br />
Limited<br />
Asianet<br />
Satellite<br />
Communications Limited<br />
Outlook Publishing (I)<br />
Private Limited<br />
Matsyagandha Investments<br />
& Finance Private Limited<br />
Brindaban Agro Industries<br />
Private Limited<br />
Peninsula Estates Private<br />
Limited<br />
Bayside Exports Private<br />
Limited<br />
R.B.R Construction Private<br />
Limited<br />
Spur Cable & Datacom<br />
Private Limited<br />
Colonnade Housing Private<br />
Limited<br />
Varahagiri Investment &<br />
Finance Private Limited<br />
Optimix Technologies<br />
Private Limited<br />
Brindaban<br />
Land<br />
Development Private Limited<br />
- - (98.09)<br />
(0.12) (0.11) (0.11)<br />
(0.12) (0.11) (0.12)<br />
(0.12) (0.11) (0.12)<br />
(2070.26) (2432.51) (1938.75)<br />
- - (314.62)<br />
- - (49.30)<br />
(0.07) (0.07) (0.08)<br />
- (11.32) -<br />
(0.07) (0.07) (0.03)<br />
(0.08) (0.08) (0.06)<br />
(0.23) (0.22) (0.27)<br />
(0.08) (0.07) (0.01)<br />
- (3.80) -<br />
- (424.38) (1920.27)<br />
(0.09) (0.09) (0.03)<br />
For detailed description of our Promoter Group Companies, please see the chapter titled “Our Promoter Group<br />
Entities” beginning on page 77 of the Draft Letter of Offer<br />
11. Our Company places heavy reliance on the import of raw material<br />
Our Company has to rely heavily on the import of raw materials for manufacturing polymer. Timely<br />
procurement of raw material is the most critical aspect of our manufacturing operation and the same is subject,<br />
inter alia, to laws monitoring the import in India as also laws governing exports in the countries/territories from<br />
where the exports originate, soverign and territorial factors, among others. Further, any change in the importexport<br />
policy by the Government of India may have a negative impact on the import of our raw materials.<br />
12. At times our Company has to depend on third party manufacturers for the supply of polymer and disruption<br />
in their operations may have a negative impact on our manufacturing operations.<br />
Our Company has in house provision for the manufacture of polymer, which acts as a raw material for<br />
generating performs. However, there are occasions when in order to execute orders in bulk, our Company has<br />
to procure polymer from other manufacturers. Our Company has relied on these suppliers in times of<br />
exigencies pertaining to the supply of polymer. Any change in the supply pattern of third party suppliers may<br />
have a negative impact on the manufacture of performs, in case of any paucity in the in house manufacture of<br />
polymer.<br />
13. Potential fluctuations in future operating results on account of increase in raw material costs, transportation<br />
costs etc.<br />
The factors for potential fluctuations in future operating results include:<br />
xii
a. Cost of Raw Materials<br />
Purified Terepthalic Acid and Mono Ethylene Glycol are the major raw materials used in the manufacturing<br />
of our products. A major portion of the requirements of the basic raw materials by our Company is<br />
imported. The cost of such materials to our Company depends upon the prices ruling in the international<br />
commodity markets at the time of imports, over which our Company does not have any control. Any<br />
increase in the price of PTA and MEG would directly affect the margins of our Company.<br />
b. Labour Union<br />
Our Company employs a large number of work force at its manufacturing plant. The factory workers are<br />
affiliated to particular Trade Union(s). Any concerted industrial action could always disrupt the production<br />
volume and consequently the sales growth of our Company.<br />
c. Transportation<br />
Timely delivery of products is critical for our performance. Our Company uses third-party transporters for<br />
the supply of raw materials to our factories and for delivery of finished products to our customers. Any<br />
hindrance in the logistics network, serious strike, stoppage of work, etc by the fleet owners could cause an<br />
adverse effect on our receipt of supplies and our ability to deliver our finished products in time, which<br />
could impact our business. Further, high transportation cost and escalation thereof may affect our<br />
profitability.<br />
14. Any delay in timely delivery of our products will adversely impact our relations with the clients.<br />
Typically, business in our industry is subject to specific delivery schedule requirements with liquidated<br />
damages chargeable in the event the schedules are not adhered to. Failure to adhere to contractually agreed<br />
timelines could cause damage to our reputation within our industry and client base, which may lead to<br />
loss/reduction of business from exising clients and not being able to procure new clients, and cause us to pay<br />
liquidated damages.<br />
15. Our results of operations could be adversely affected by disputes with our employees<br />
As of March 31, 2008, our Company has employed 827 full-time employees. While our Company believes that<br />
itgenerally maintains satisfactory relationships with its employees and labour, there can be no assurance that<br />
itwill not experience future disruptions in its operations due to disputes or other problems with its work force.<br />
Further, any upward revision of wages required by the government to be paid to labourers, or offer of<br />
permanent employment or the unavailability of the required number of contract labourers, may adversely affect<br />
our business and results of our operations.<br />
16. Non renewal of the statutory and regulatory permissions and approvals required to operate our business<br />
may have a material adverse effect on our business.<br />
Being in the manufacturing business, our Company requires several statutory and regulatory permits, licenses<br />
and approvals to operate the business. Many of these approvals are granted for fixed periods of time and need<br />
renewal from time to time. Our Company is required to renew such permits, licenses and approvals. There can<br />
be no assurance that the relevant authorities will issue any of such permits or approvals in time or at all. Further,<br />
these permits, licenses and approvals are subject to several conditions, and our Company cannot assure that it<br />
shall be able to continuously meet such conditions or be able to prove compliance with such conditions to<br />
statutory authorities, and this may lead to cancellation, revocation or suspension of relevant permits/ licenses/<br />
approvals. Failure by our Company to renew, maintain or obtain the required permits, licenses or approvals, or<br />
cancellation, suspension or revocation of any of the permits, licenses or approvals may result in the interruption<br />
of our Company’s operations and may have a material adverse effect on the business. For details please refer to<br />
chapter titled “Government/Statutory Approvals” beginning on page 200 of the Draft Letter of Offer.<br />
17. Our existing manufacturing unit is located in Manali, Chennai. Any unrest or natural calamity in this unit<br />
can break down our operations which will adversely affect our operations.<br />
Our manufacturing unit at Manali, Chennai and our business operations are vulnerable to damage or<br />
interruptions in operations due to adverse weather conditions, earthquakes, tsunami, fires, explosions, power<br />
loss, viruses, transmission cable cuts or similar events. Any failure of our systems or any shutdown of any part<br />
of our manufacturing units, networks, operations because of operational disruption, natural disaster such as<br />
flood or earthquake, or otherwise, could disrupt our services and result in significant costs.<br />
xiii
Further, there can be no assurance that business continuity plans our Company has developed to cover material<br />
breakdowns or damage to its manufacturing units, network or critical operating equipment will be sufficient to<br />
maintain its operations in adverse circumstances.<br />
18. Our Company has high capital expenditure requirements.<br />
The cost of fixed assets/equipment in our business, including replacement cost, is very high. Our Company<br />
may need additional financing in the future in the form of debt and/or capital to fulfill its capital expenditure<br />
needs. Our Company cannot assure that such financing would be available, or available at terms acceptable to<br />
us, and consequently our capital expenditure plans may be adversely affected. Further, the cost of servicing<br />
debt/capital may have a material adverse effect on our results of operations and financial condition.<br />
19. Our funding requirements and deployment of the proceeds of the Issue are based on management estimates<br />
and have not been verified independently.<br />
Our funding requirements and the deployment of the proceeds of the Issue are based on management estimates<br />
and have not been appraised by any bank or financial institution. Further, such estimates are based on market<br />
conditions and management expectations as of the date they were made. In view of the highly competitive<br />
nature of the industry in which our Company operates, we may have to revise our management estimates from<br />
time to time and consequently our funding requirements may also change. We may need to borrow further/raise<br />
further capital to meet our working capital requirements for the FY 2008-2009, meeting which is the primary<br />
object of this Issue, and the cost of servicing debt/capital may have a material adverse effect on our results of<br />
operations and financial condition.<br />
20. The Issue proceeds shall be utilized for the purposes of funding working capital requirements and general<br />
corporate purpose. Hence would not result in the creation of tangible fixed assets.<br />
The Issue proceeds shall be primarily and significantly utilized for the funding working capital requirements<br />
and general corporate purposes. Our business demands heavy expenditure on raw material and this leads to an<br />
increased manufacturing cost. The money raised through present Rights Issue will be used to generate this<br />
working capital, and thus is not expected to result in creation/acquisition of tangible fixed assets. For details,<br />
please refer to the chapter titled on “Objects of the Issue” beginning on page 21 of the Draft Letter of Offer.<br />
21. Our Company may not have adequate insurance to cover all probable risks in its business operations. Loss<br />
on account of uninsured risks may affect the results of our operations.<br />
We believe that we maintain insurance in accordance with customary industrial practices. However, the amount<br />
of our insurance coverage may be less than replacement cost of all covered property and may not be sufficient<br />
to cover all financial losses that we may suffer should a risk materializes. Further, there are many events that<br />
could cause significant damages to our operations or expose us to third party liabilities, whether or not known to<br />
us, for which we may not be adequately insured. Further, all our insurance policies have exclusion clauses and<br />
do not cover us for certain risks and in certain circumstances. If we were to incur a significant liability for<br />
which we were not fully insured, it could have a material adverse effect on our results of operations and<br />
financial condition.<br />
22. Compliance with and changes in safety, health, and environmental laws and regulations may adversely<br />
affect our business, prospects, financial condition and results of our operations<br />
Our Company is subject to safety and health laws and regulations such as the Environment (Protection) Act,<br />
1986, the Water (Prevention and Control of Pollution) Act, 1974, the Air (Prevention and Control of Pollution)<br />
Act, 1981, Hazardous Wastes (Management & Handling) Rules, 1989, the Indian Explosives Act, Fire Service<br />
Laws and the Indian Boilers Act, 1923. These laws and regulations impose controls on our Company’s safety<br />
standards, and other aspects of its operations. Our Company has incurred and expects to continue to incur,<br />
operating costs to comply with such laws and regulations. In addition, our Company has made and expects to<br />
continue to make capital expenditures on an on-going basis to comply with the safety and health laws and<br />
regulations. Our Company may be liable to the Government of India or the State Governments or Union<br />
Territories with respect to its failures to comply with applicable laws and regulations. Further, the adoption of<br />
new safety and health laws and regulations, new interpretations of existing laws, increased governmental<br />
enforcement of laws or other developments in the future may require that our Company make additional capital<br />
xiv
expenditures or incur additional operating expenses in order to maintain its current operations or take other<br />
actions that could have a material adverse effect on its financial condition, results of operations and cash flow.<br />
Safety, health and environmental laws and regulations in India, in particular, have been increasing in stringency<br />
and it is possible that they will become significantly more stringent in the future. The costs of complying with<br />
these requirements could be significant.<br />
23. Our Promoter and Promoter Group holding is low.<br />
Upon completion of the Issue, the Promoters and Promoter Group Entities may beneficially own at least 38.89%<br />
of our post-Issue Equity Sharecapital. Since our Promoters and Promoter Group own less than 50% of the paid<br />
up share capital of our Company, they may not be able to continue exercising significant control over our<br />
Company, including being able to control the composition of our Company’s Board of Directors, determine<br />
decisions requiring majority voting, and may be unable to affect the outcome of certain shareholder resolutions,<br />
even though the same may be in the best interests of our Company. Further, our Company is vulnerable to<br />
hostile takeovers, and we cannot assure that any potential acquirer would act in the best interests of our<br />
Company or its shareholders.<br />
24. We have entered into and shall continue to enter into Related Party Transactions<br />
Our business model involves entering into certain related party transactions. We have entered into certain<br />
related party transactions with our Promoters, Directors and Promoter group entities. For further details, refer to<br />
the chapter titled “Financial Statements” beginning on page 112 of the Draft Letter of Offer<br />
25. Any loss of or breakdown of machinery at our manufacturing facility at Manali, Chennai may have an<br />
adverse affect on business, financial condition and results of operations<br />
Our Company’s manufacturing facility at Manali, Chennai is subject to operating risks, such as the breakdown<br />
or failure of equipment, power supply or processes, performance below expected levels of output or efficiency,<br />
obsolescence, labour disputes, industrial accidents and the need to comply with the directives of relevant<br />
government authorities. The occurrence of any of these risks could significantly affect its operating results. Our<br />
business and operations may be adversely affected by any disruption of operations at our manufacturing facility.<br />
26. Product innovation and research and development activities are an integral part of our business model. If<br />
our research and product development efforts are not successful, our business may be restricted.<br />
Growth of our future operations depends upon our ability to successfully carry out research and development of<br />
new processes and produce new and higher quality products from a variety of raw materials. These processes<br />
must meet quality standards where applicable and may sometimes require regulatory approvals. The<br />
development and commercialization process would require spending of both time and money. Our ongoing<br />
investments in research and development for future products and processes may result in higher costs without a<br />
proportionate increase in revenues. Any failure or delay in timely development and commercialization of new<br />
products or our inability to obtain patents or other legal protection may have a material adverse effect on our<br />
business, results of operations and financial condition.<br />
27. Our operations involve handling hazardous material that could expose us to the risk of liabilities, lost<br />
revenues and increased expenses.<br />
Our operations are subject to various hazards associated with the production of chemical products, such as the<br />
use, handling, processing, storage and transportation of hazardous/explosive materials such as, as well as<br />
accidents such as leakage or spillages of chemicals. Any mishandling of hazardous chemical and poisonous<br />
substances could also lead to fatal accidents. In order to prevent such mishandling we have established various<br />
measures including training of workers, prominent display of safety measures and precaution measures in<br />
production areas. In addition, our employees operate heavy machinery at our manufacturing facilities and<br />
accidents may occur while operating such machinery. These hazards can cause personal injury and loss of life,<br />
severe damage to and destruction of property and equipment, environmental damage and may result in the<br />
suspension of operations and the imposition of civil and criminal liabilities. As a result of past or future<br />
operations, there may be claims of injury by employees or members of the public due to exposure, or alleged<br />
exposure, to the hazardous materials involved in our business. In addition, we may be subject to claims of injury<br />
from indirect exposure to hazardous materials that are incorporated into our products. Liabilities incurred as a<br />
result of these events have the potential to adversely impact our financial position. Events like these could also<br />
xv
adversely affect our perception with suppliers, customers, regulators, employees and the public, which could in<br />
turn affect our financial condition and business performance. While we maintain general insurance against these<br />
liabilities, the insurance proceeds may not be adequate to fully cover the substantial liabilities, lost revenues or<br />
increased expenses that we might incur.<br />
28. As per the loan agreements entered into by us with our lenders, there are certain restrictions on us, which<br />
may hamper our future business growth and business policies.<br />
We have entered into agreements for availing financial facilities from various lenders. Certain covenants in<br />
these agreements require us to obtain approval/ permission from our lenders. These covenants include, amongst<br />
others, implementation of any scheme of expansion / diversification / renovation / capital expenditure,<br />
formulation of any scheme of amalgamation or reconstruction, undertaking of guarantee obligation, any change<br />
in our capital structure, among others. We cannot assure that these approvals would be forthcoming when we<br />
apply for the same.<br />
Accordingly, we are required to obtain prior consent from our lenders for the Issue. We are yet to obtain the<br />
consent of <strong>IDBI</strong> Bank Limited, one of our lenders, for this Issue, for which we have applied.<br />
For further details in this regard, please refer chapter titled “Financial Indebtedness” beginning on page 46 of<br />
the Draft Letter of Offer<br />
29. Our agreements with certain commission agents have certain exclusivity clauses<br />
Our agreements with certain of our commission agents bind us with exclusivity clauses. These exclusivity<br />
clauses pertain to, among others(varying from agreement to agreement) the geographical coverage of markets,<br />
products to be sold in certain markets or products sold to certain customers. We cannot assure that we would<br />
continue to be compliance with the exclusivity terms in these agreements, and any breach of the same may<br />
expose us to risk of termination of contract and legal proceedings. These exclusivity terms may adversely affect<br />
our ability to expand our business in the areas/products covered by the relevant agreement, which may have a<br />
consequent adverse impact on our business, financial condition and results of operations.<br />
30. Agreements entered into by our Company with the commission agents are not stamped. Further, agreements<br />
with commission agents outside India are enforceable outside India.<br />
Agency agreements entered into by us with our commission agents have not been stamped. The effect of nonstamping<br />
is that the document is not admissible as evidence in legal proceedings, and parties to that agreement<br />
may not be able to legally enforce to same, except after paying a penalty for inadequate stamping.<br />
Further, our agreements with commission agents outside India provide for venue for arbitration and/or<br />
jurisdiction in Courts outside India, including in the United Kingdom. The legal and other costs that we may<br />
incur in initiating and/or defending any actions arising out of such contracts could be significantly higher<br />
outside India than in India. Further, we may not always be able to enforce/execute judgments obtained in<br />
foreign courts/tribunals against the counterparties.<br />
31. Our Company has not achieved the projections as promised in our earlier rights issues<br />
Our Company has made rights issues in the years 1988, 1993 and 2004, in which respect, certain<br />
projections/promises made in the rights issue offer document in 1993 were not fulfilled. For futher details, refer<br />
to paragraph titled “Details of Public / Rights Issues” beginning on 213 of the Draft Letter of Offer.<br />
External Risk Factors:<br />
1. A slowdown in economic growth in India could cause our business to suffer.<br />
Our performance and growth are dependent on the health of the Indian economy. The economy could be<br />
adversely affected by various factors such as political or regulatory action, including adverse changes in<br />
liberalization policies, social disturbances, terrorist attacks and other acts of violence or war, natural calamities,<br />
interest rates, commodity and energy prices and various other factors. Any slowdown in the Indian economy<br />
may adversely impact our business and financial performance and the price of our Equity Shares.<br />
xvi
2. Any downgrading of India’s debt rating by an independent agency may harm our ability to raise financing.<br />
Any adverse revisions to India’s credit ratings for domestic and international debt by international rating<br />
agencies may adversely affect our ability to raise additional financing and the interest rates and other<br />
commercial terms at which such additional financing is available. This could have a material adverse effect on<br />
our capital expenditure plans, business and financial performance and the price of our Equity Shares.<br />
3. Force Majeure events, terrorist attacks and other acts of violence or war involving India or other countries<br />
could adversely affect the financial markets, result in a loss of investor confidence and adversely affect our<br />
business, results of operations, financial condition and cash flows.<br />
Certain events are beyond our control, such as force majeure events, terrorist attacks, and other acts of violence<br />
or war, civil unrest and military activity. Any such event could happen at or otherwise affect one or more of our<br />
businesses, which would adversely affect our business, results of operations and financial condition. Moreover,<br />
these and other similar events may adversely affect worldwide financial markets and could lead to global<br />
economic recession. Such events may also result in a loss of business confidence or have other consequences<br />
that could adversely affect our business, results of operations and financial condition. The occurrence of any of<br />
the foregoing could therefore adversely affect our financial performance or the market price of the Equity<br />
Shares.<br />
4. An outbreak of an infectious disease or any other serious public health concerns in Asia or elsewhere could<br />
have an adverse effect on our business and results of operations.<br />
The outbreak of an infectious disease in Asia or elsewhere or any other serious public health concerns could<br />
have a negative impact on the economies, financial markets and business activities in the countries in which our<br />
end markets are located, which could have an adverse effect on our business.<br />
5. We are subject to regulatory, economic and political uncertainties in India.<br />
In the early 1990s, India experienced significant inflation, low growth in gross domestic product and shortages<br />
of foreign currency reserves. The Indian government provided significant tax incentives and relaxed certain<br />
regulatory restrictions in order to encourage foreign investment in specified industries of the economy. There is<br />
no assurance that liberalization policies will continue. Furthermore, the rate of economic liberalization could<br />
change, and specific laws and policies affecting technology companies, foreign investment, currency exchange<br />
rates and other matters affecting investment in our Equity Shares could also change. Since 1996, the<br />
Government of India has changed six times and the current Indian government is a coalition of many parties,<br />
some of which may differ from India’s current economic policies. Various factors, including a collapse of the<br />
present coalition government due to the withdrawal of support of coalition members, could trigger significant<br />
changes in India’s economic liberalization and deregulation policies, disrupt business and economic conditions<br />
in India generally and our business in particular. Our financial performance and the market price of our shares<br />
may be adversely affected by changes in inflation, exchange rates and controls, interest rates, government of<br />
India policies, social stability or other political, economic or diplomatic developments affecting India in the<br />
future.<br />
6. We are subject to risks arising from exchange rate fluctuations.<br />
The exchange rate between the Rupee and other currencies is variable and may continue to fluctuate in the<br />
future. Fluctuations in the exchange rates may affect us to the extent of such orders being placed overseas. We<br />
may place orders with overseas contractors and manufacturers. Such fluctuation may affect us to the extent of<br />
increasing the cost of import of goods and services.<br />
7. Regional conflicts in South Asia could adversely affect the Indian economy, disrupt our Company's<br />
operations and cause its business to suffer.<br />
South Asia has, from time to time, experienced instances of civil unrest and hostilities among neighbouring<br />
countries. In recent years there have been military confrontations along the India-Pakistan border. Military<br />
activity or terrorist attacks could adversely affect the Indian economy. This could have a material adverse effect<br />
on the market for securities of Indian companies including the Equity Shares of our Company.<br />
xvii
Risks Relating to the Issue of Securities:<br />
1. There are restrictions on daily movements in the price of the Equity Shares, which may adversely affect a<br />
shareholder’s ability to sell, or the price at which it can sell, Equity Shares at a particular point in time.<br />
We are subject to a daily “circuit breaker” imposed by all stock exchanges in India, which does not allow<br />
transactions beyond specified increases or decreases in the price of the Equity Shares. This circuit breaker<br />
operates independently of the index-based market-wide circuit breakers generally imposed by SEBI on Indian<br />
stock exchanges. The maximum movement allowed in the price of the Equity Shares before the circuit breaker<br />
is triggered is determined by the Stock Exchange based on the historical volatility in the price and trading<br />
volume of the Equity Shares. The Stock Exchange does not inform us of the triggering point of the circuit<br />
breaker in effect from time to time, and may change it without our knowledge. This circuit breaker limits the<br />
upward and downward movements in the price of the Equity Shares. As a result of this circuit breaker, no<br />
assurance may be given regarding your ability to sell your Equity Shares or the price at which you may be able<br />
to sell your Equity Shares at any particular time.<br />
2. Our stock price may be volatile, and you may be unable to resell your shares at or above the Issue price or at<br />
all.<br />
The market price of our Equity Shares after this Issue will be subject to significant fluctuations in response to,<br />
among other factors:<br />
1 Variations in our operating results and the performance of our business;<br />
2 Adverse media reports about us;<br />
3 Regulatory developments in our target markets affecting us, our clients or our competitors;<br />
4 Market conditions and perception specific to the polyester and perform industry<br />
5 Changes in financial estimates by securities research analysts;<br />
6 Loss of one or more significant clients;<br />
7 The performance of the Indian and global economy;<br />
8 Significant developments in India’s economic liberalization and deregulation policies and the fiscal regime; and<br />
9 Volatility in the Indian and global securities markets.<br />
Many of these factors are beyond our control. There has been recent volatility in the Indian stock markets and<br />
our share price could fluctuate significantly as a result of such volatility in the future.<br />
3. Any future issuance of Equity Shares by us or the issue of stock options under an employee stock option plan<br />
may dilute the investor’s shareholding or adversely affect trading price of the Equity Shares.<br />
Any future issuance of Equity Shares by us or the issue of stock options under an employee stock option plan<br />
where ourCompany issues further Equity Shares could dilute the investor’s shareholding. Additionally, sales of<br />
our Equity Shares by our Promoters or significant shareholders could also have an adverse affect on the trading<br />
price of the Equity Shares. Such events could also impact our ability to raise capital through an offering of our<br />
securities. In addition, any perception by investors that such issuances or sales might occur could also affect the<br />
trading price of the Equity Shares.<br />
Notes to Risk Factors:<br />
1 Issue of 2,62,10,839 Equity Shares with a face value of Rs. 10/- each at par of our Company at par (that is,<br />
Rs. 10/- each) for an amount aggregating to Rs. 2621.08 lacs on rights basis to the existing shareholders of<br />
our Company in the ratio of one Equity Share for every two fully paid Equity Shares held by the shareholders<br />
on the Record Date, that is on [●], 2008. For more details, please refer chapter titled “Terms of the Issue”<br />
beginning on page 221 of the Draft Letter of Offer.<br />
2 All information shall be made available by the Lead Manager and our Company to the existing shareholders<br />
of our Company and no selective or additional information would be available only to a section of the<br />
investors in any manner whatsoever.<br />
3 Net worth as per the Restated Financials as on March 31, 2006, March 31, 2007 and March 31, 2008 was, Rs.<br />
10, 972.36 lacs and Rs. 12,034.89 lacs and Rs. 10,581.21 lacs respectively.<br />
xviii
4 Net Asset Value as per the Restated Financials as on March 31, 2006, March 31, 2007 and March 31, 2008,<br />
was Rs. 20.80, Rs. 22.93 and Rs. 25.09 per share respectively.<br />
5 For Related Party Transactions please refer to chapter titled “Related Party Transactions” beginning on page<br />
110 of the Draft Letter of Offer.<br />
6 For interest of our Promoters/Directors/key managerial personnel and other ventures promoted by Promoters,<br />
please refer to chapters titled “Risk Factors”, “Our Promoters”, “Our Management” and “Financial<br />
Statements” beginning on page viii, on page 75, on page 61 and 112 of the Draft Letter of Offer.<br />
7 Investors are advised to refer to the section titled “Basis for Issue Price” beginning on page 24 of the Draft<br />
Letter of Offer<br />
8 Please refer to the paragraph on "Basis of Allotment" beginning on page 235 of the Draft Letter of Offer for<br />
details of the basis of allotment.<br />
xix
SECTION III - INTRODUCTION<br />
SUMMARY<br />
This is only a summary and does not contain all the information that you should consider before investing in<br />
our Equity Shares. You should read the entire Draft Letter of Offer, including the information contained in<br />
the sections titled “Risk Factors” and “Financial Statements” and related notes beginning on pages viii and<br />
111 of the Draft Letter of Offer before deciding to invest in our Equity Shares.<br />
Industry Overview:<br />
Petrochemicals are derived from various chemical compounds, mainly from hydrocarbons. These hydrocarbons<br />
are derived from crude oil and natural gas. Among the various fractions produced by distillation of crude oil,<br />
petroleum gases, naphtha, kerosene and gas oil are the main feed stocks for petrochemical industry. Ethane,<br />
propane and natural gas liquids obtained from natural gas are the other important feedstock used in the<br />
Petrochemicals industry. Petrochemical industry plays a vital role in economic growth and development of<br />
manufacturing sector. The value addition in the petrochemicals industry is higher than most of the other industry<br />
sectors.<br />
The Petrochemical industry, which entered in the Indian industrial scene in 1970s, registered a rapid growth in<br />
the 1980s and 1990s. Petrochemical industry mainly comprise of synthetic fibre / yarn, polymers, Synthetic<br />
Rubber, Synthetic detergent intermediates, performance plastics and plastic processing industry.<br />
Today, petrochemical products permeate the entire spectrum of daily use items and cover almost every sphere of<br />
life like clothing, housing, construction, furniture, automobiles, household items, agriculture, horticulture,<br />
irrigation, packaging, medical appliances, electronics and electrical etc.<br />
India Scenario<br />
Consumption of PE, PP and PVC (three major polymers) in India reached 4.6 million tonnes registering a y-o-y<br />
growth of 10% during FY 2006-07. PP and LLDPE registered a healthy growth of 15%. LDPE consumption<br />
grew at 8% whereas HDPE grew at 9% and PVC witnessed a modest growth of 7%. The demand for PVC in<br />
India experienced a 7% y-o-y growth.<br />
The production performance of major petrochemicals during 2001-02 to 2005-06 is as follows:<br />
Units in Kilo Tons<br />
Sub-group 2001-02 2002-03 2003-04 2004-05 2005-06<br />
Annualized<br />
Growth Rates(%)<br />
Synthetic Fiber 1667 1755 1868 1875 1906 3.4<br />
Polymers 3974 4175 4499 4776 4768 4.7<br />
Elastomers 79 81 87 97 110 8.63<br />
Synthetic<br />
Detergent 425 447 453 488 556 7.0<br />
Intermediates<br />
Performance<br />
Plastics<br />
90 95 99 113 127 9.0<br />
Total 6235 6553 7007 7349 7467 4.61<br />
Source: Ministry of Chemicals and Fertilizers-Petrochemicals<br />
Polyester fibers are the most widely used synthetic fibers in the world today. Polyester fibers, however, have<br />
poor elasticity and stretch recovery, do not absorb moisture, are comparatively difficult to dye, and generate<br />
static electricity under dry conditions. However, many of the deficiencies of polyester filament yarn and staple<br />
fibre can be reduced or overcome by fiber modification and/or by blending with cotton or other fibers. Hightenacity<br />
polyester filament yarn and staple fibre have a higher tensile strength and a lower elongation before<br />
break than conventional polyester fiber. High-tenacity polyester fibers are used for both industrial and textile<br />
applications for which high strength and low crimp are important.<br />
1
PET<br />
PET is eco-friendly and inert which has established itself as the polymer of the future in most packaging<br />
applications, especially in food and beverage packaging. It is widely used in packaging of soft drinks, water,<br />
edible oil, food products, juices, dairy beverages, pharmaceuticals, toiletries etc.<br />
The overall worldwide demand of PET resin continues to grow with the increasing demand of plastic and PET<br />
packaging. The total world demand for PET resin is estimated to be 14.6 million tons in 2010 as compared to<br />
10.0 million tons in 2005-06. In India also the market for PET Resin is growing steadily. The demand of PET<br />
resin is also influenced by seasonal factors and the growth pattern of the food processing and FMCG sectors.<br />
For further information please refer to section tltled“About Us” beginning on page 28 of theDraft Letter of<br />
Offer.<br />
Business Overview:<br />
Our Company was incorporated as a public limited company in Maharashtra under the name Indian Organic<br />
Chemicals Limited in February 1960 and commenced business on April 22, 1960. We commenced<br />
manufacturing operations at our plant at Khopoli, Maharashtra, for production of alcohol-based chemicals like<br />
Acetic Acid, Acetic Anhydride, Acetaldehyde and Ethyl Acetate, Benzyl products, Plasticizers and Glyoxal.<br />
In 1972, we set up a plant at Manali, Chennai, for manufacture of Polyester Fibres with an installed capacity of<br />
6,100 MT per annum. By 1986, the capacity was expanded to 38,500 MT per annum. Subsequently, a 9,175 MT<br />
of Polyester Filament Yarn (POY) plant was also set up. The POY business was discontinued after 1995 due to<br />
its uneconomic size and the plant had since been disposed off.<br />
With the launching of petro-based chemicals in 1990s and liberalization of molasses usage for potable alcohol,<br />
our industrial alcohol-based facility at Khopoli lost its competitive edge. The chemicals business had to be<br />
phased out gradually over a period of time. We however, succeeded in adapting and using our facilities at<br />
Khopoli to undertake knowledge based activities like custom synthesis, contract manufacture and contract R&D.<br />
In India skilled manpower like scientists, chemists and engineers are easily available at competitive rates. As the<br />
new activity is “knowledge based” requiring a different focus, our Company decided to transfer the Chemicals<br />
division at Khopoli to another entity called Innovassynth Technologies (India) Limited.<br />
With the separation of chemical business of our Company as above, our Polyester business at Chennai started<br />
focusing on Speciality Fibres, Speciality Polymers and Preforms. In order that the name of our Company<br />
correctly reflects the core business in which it is engaged in, our Company changed its name to “Futura<br />
Polyesters Limited” which became effective from November 05, 2002. (“Futura” is the registered trade mark of<br />
our Company under which it markets its products.) For details regarding plant location, utilisation of installed<br />
capacity and other related matters please refer to chapter titled “Business Overview” beginning on page [] of<br />
the Draft Letter of Offer.<br />
During the year 1993, our Company commenced production of PET Resin and Preforms at Manali, Chennai,<br />
under the name Futura Polymers Limited, as a joint venture with PepsiCo, USA, through its investment arm<br />
Transmere Inc., Mauritius. Subsequently during the year 1998, PepsiCo Inc. quit the joint venture. During the<br />
year 2002, Futura Polymers Limited was amalgamated with our Company.<br />
Our Company has one manufacturing facility at Chennai, currently consisting of three major activities, namely,<br />
Polyester Staple Fibres/Chips, PET Resins and PET Preforms. The installed capacities of these as on March 31,<br />
2008 are as under:<br />
Product<br />
Installed Capacity in MT per<br />
annum<br />
Polyester Staple Fibre / Chips 38,500<br />
Solid State Polymers 57,000<br />
PET Preforms 20,000<br />
We had established a subsidiary called Futura Industries Limited (FIL) to carry out Development on PET<br />
recycling and commercialise the technology for recycling of Polyester fibre waste and PET bottle scrap into<br />
polyester feed stock. Initially, the factory was located at Tiruvellore, near Chennai. FIL was carrying out the<br />
operations on job work basis for our Company for some time and the facilities were shifted, during 1997from<br />
2
Tiruvellore to the main factory located at Manali, Chennai. In the year 2001, FIL was amalgamated with our<br />
Company. Presently, the PET recycling activity is being carried out at our factory at Manali, Chennai.<br />
Business Strategy<br />
Our strategy is to consolidate and enhance our market position as a producer of Specialty Fibres, Speciality<br />
Polymers and Speciality Preforms. We aim to achieve our strategic objective by implementing the following<br />
strategies:<br />
1 Continuous research and development in new speciality products to maintain a diverse product mix<br />
2 Increase in revenues by utilising our established business relationships<br />
3 Focus on speciality products realizing better margins<br />
4 Strengthening our competitive edge by patenting newly developed products<br />
5 Positioning ourselves amongst the top global brands by manufacturing diverse range of polyesters like PBT,<br />
PTT, PBN, PTN, PEN etc.<br />
We have been continuously developing new products to meet customised needs of our customers. With more<br />
than three decades of experience in Polyesters supported by our established business relationships with our<br />
customers, we believe that we are well placed to secure a significant share of Specialty Resin markets on the<br />
strength of our customised product development.<br />
For further information please refer to section on “About Us” beginning on page 28 of the Draft Letter of Offer.<br />
3
THE ISSUE<br />
Equity Shares proposed to be issued by our Company<br />
Rights Entitlement<br />
Record Date<br />
2,62,10,839 Equity Shares of Rs. 10 each<br />
One Equity Share for every two fully paid up Equity Shares<br />
held on the Record Date<br />
[●]<br />
Issue Price per Equity Share Rs. 10/-<br />
Equity Shares outstanding prior to the Issue<br />
Equity Shares outstanding after the Issue of Equity<br />
Shares.<br />
Terms of the Issue<br />
5,24,21,679 Equity Shares of Rs. 10 each<br />
7,86,32,518 Equity Shares of Rs. 10 each<br />
For more information, refer to section titled “Terms of The<br />
Issue” beginning on page 220 of the Draft Letter of Offer.<br />
Terms of Payment<br />
On Rights Issue application<br />
Rs. 10/- which constitutes 100% of the full amount<br />
of the Issue Price of Rs. 10/-<br />
4
SUMMARY STATEMENT OF FINANCIAL INFORMATION<br />
You should read the following information together with the information contained in the Auditors’ report<br />
included in the section titled “Financial Statements” beginning on page 111 of the Draft Letter of Offer.<br />
Summary Statement of Assets and Liabilities, as Restated<br />
Sr.<br />
No Particulars<br />
As at<br />
Rupees in lacs<br />
31-Mar-08 31-Mar-07 31-Mar-06 31-Mar-05 31-Mar-04<br />
1 FIXED ASSETS<br />
Gross Block 59,885.68 43,437.40 41,637.34 40,134.39 39,530.90<br />
Less: Depreciation 25,997.55 23,776.81 21,438.63 19,071.16 16,698.29<br />
Net Block 33,888.13 19,660.59 20,198.71 21,063.23 22,832.61<br />
Add: <strong>Capital</strong> Work - in - Progress 2,581.05 976.24 674.50 463.03 127.69<br />
Less: Revaluation Reserve 14,293.43 1,087.64 1,995.37 2,905.50 3,833.36<br />
Net Block after adjustment for<br />
Revaluation Reserve 22,175.75 19,549.19 18,877.84 18,620.76 19,126.94<br />
2 INVESTMENTS 2,621.11 2,381.22 2,378.91 2,578.91 2,583.67<br />
3 DEFERRED TAX ASSETS (NET) 74.57 541.19 975.13 1,115.87 1,486.20<br />
4<br />
CURRENT ASSETS, LOANS AND<br />
ADVANCES<br />
Inventories 11,825.74 8,320.37 9,484.56 7,568.29 5,188.71<br />
Sundry Debtors 3,742.01 3,647.75 2,464.08 4,230.74 2,534.73<br />
Cash and Bank Balances 1,824.15 1,734.06 1,947.84 1,514.78 4,364.45<br />
Loans and Advances 2,651.44 2,760.63 2,525.71 1,767.76 2,225.11<br />
20,043.34 16,462.81 16,422.19 15,081.57 14,313.00<br />
LIABILITIES AND PROVISIONS:<br />
5 SECURED LOANS 11,585.42 10,604.11 10,474.00 9,734.59 10,541.62<br />
6 UNSECURED LOANS 4,327.35 4,437.61 4,662.89 5,452.95 4,507.62<br />
7<br />
CURRENT LIABILITIES AND<br />
PROVISIONS<br />
Current Liabilities 14,971.69 11,096.21 11,902.68 10,900.22 13,186.00<br />
Provisions 877.99 775.36 709.31 638.27 625.50<br />
15,849.68 11,871.57 12,611.99 11,538.49 13,811.50<br />
NET WORTH (1+2+3+4-5-6-7) 13,152.32 12,021.12 10,905.19 10,671.08 8,649.07<br />
NET WORTH REPRESENTED BY<br />
8 SHARE CAPITAL 5,242.17 5,242.17 5,242.17 4,835.59 3,347.71<br />
9 RESERVE AND SURPLUS 22,213.93 7,880.36 7,725.56 8,962.07 9,529.49<br />
Less: Revaluation Reserve 14,293.43 1,087.64 1,995.37 2,905.50 3,833.36<br />
Less: Miscellaneous Expenditure 10.35 13.77 67.17 221.08 394.77<br />
Reserves (Net of Revaluation<br />
Reserves) 7,910.15 6,778.95 5,663.02 5,835.49 5,301.36<br />
NET WORTH (8+9) 13,152.32 12,021.12 10,905.19 10,671.08 8,649.07<br />
5
Summary statement of Profit & Losses, as Restated<br />
Rupees in lacs<br />
Particulars<br />
For the year ending 31 st March<br />
2007-08 2006-07 2005-06 2004-05 2003-04<br />
INCOME<br />
Sales and Services (Gross)<br />
Manufacture 44,814.30 56,146.50 52,138.73 52,175.54 45,090.96<br />
Traded - - - - 114.27<br />
Less: - Excise Duty 4,464.34 4,621.98 5,023.54 4,956.42 4,341.82<br />
Services 1,012.80 181.90 - 174.72 124.81<br />
41,362.76 51,706.42 47,115.19 47,393.84 40,988.22<br />
Other Income 1,295.89 520.17 487.99 587.72 610.98<br />
(Less)/Add: (Increase)/Decrease in<br />
Inventories (1,078.40) 829.70 (1,420.22) (1,482.90) 1,660.85<br />
43,737.05 51,396.89 49,023.40 49,464.46 39,938.35<br />
EXPENDITURE<br />
Raw Material Consumed 23,590.41 29,400.62 29,802.01 28,881.78 23,200.74<br />
Staff Costs 1,690.89 2,009.97 1,990.54 1,833.13 1,982.94<br />
Other Manufacturing Expenses 10,055.20 11,822.37 11,372.38 11,001.91 10,325.83<br />
Administration Expenses 1,265.81 1,111.74 1,083.47 1,092.17 1,247.95<br />
Selling and Distribution Expenses 1,479.22 1,946.43 2,198.18 2,345.33 2,370.26<br />
Purchase of Traded Items - - - - 170.48<br />
Interest 2,126.66 1,764.13 1,890.76 1,917.19 2,411.58<br />
Depreciation 2,577.57 2,478.71 2,391.90 2,410.31 2,188.33<br />
Less:- Transfer from Revaluation Reserve (884.15) (907.73) (910.15) (937.42) (311.76)<br />
41,901.61 49,626.24 49,819.09 48,544.40 43,586.35<br />
Net Profit /(Loss) before Tax and<br />
Extraordinary items 1,835.44 1,770.65 (795.69) 920.06 (3,648.00)<br />
Add: Profit on sale of Chemical Business<br />
Less: Voluntary Retirement Scheme<br />
- - - - 1,626.97<br />
8.39 25.39 57.75 86.39 264.62<br />
Less: Deferred VRS Gratuity Payment<br />
- 31.51 100.61 100.61 100.61<br />
Profit / (Loss) after extra ordinary items<br />
but before tax 1,827.05 1,713.75 (954.05) 733.06 (2,386.26)<br />
Less: Provision for Tax 203.83 192.28 - - -<br />
Less: Provision for Wealth Tax 2.00 2.00 2.00 2.29 2.50<br />
Less: Provision for Fringe Benefit Tax<br />
Add: Deferred Tax adjustment<br />
28.00 23.00 43.00 - -<br />
(466.61) (433.94) (140.74) (370.33) 2,188.15<br />
Less: Excess Provision of Earlier Years<br />
(1.17) - - - -<br />
Net Profit /(Loss) after Tax 1,127.78 1,062.53 (1,139.79) 360.44 (200.61)<br />
Balance brought forward 1,064.57 2.04 1,141.83 781.39 982.00<br />
BALANCE CARRIED TO BALANCE<br />
SHEET 2,192.35 1,064.57 2.04 1,141.83 781.39<br />
6
Summary Statement Of Cash Flows, As Restated<br />
Particulars<br />
(A) CASH FLOW FROM OPERATIONS<br />
Net Profit before tax and extra-ordinary item<br />
Rupees in lacs<br />
For the year ending 31 st March<br />
2007-08 2006-07 2005-06 2004-05 2003-04<br />
1,835.44 1,770.65 (795.69) 920.06 (3,648.00)<br />
Adjustment for<br />
Depreciation 1,693.42 1,570.98 1,481.75 1,472.89 1,876.57<br />
Foreign Exchange Fluctuation (Net) (194.51) (70.76) (61.79) (1.20) (14.66)<br />
Interest / Dividend Income (272.57) (4.80) (6.69) (331.42) -<br />
Interest Expenses 2,126.66 1,764.13 1,890.76 1,917.19 2,411.58<br />
Profit / (Loss) on Sale of Fixed Assets (638.45) (33.47) 3.58 (0.83) 307.33<br />
Profit / (Loss) on Sale of Investments - - (20.00) (8.00) 23.17<br />
Diminution in Value of Investments - - - - 14.59<br />
Provision for Doubtful Debts / Advances 59.41 165.13 23.36 76.49 85.63<br />
Provision for Doubtful Debts / Advances Written - back - - - - (190.28)<br />
Provision no longer required written back (2.37) (68.77) (112.18) (106.21) (43.61)<br />
Credit balances written back (0.24) (7.97) (0.60) (56.58) (172.91)<br />
Provision for Investments Written - back - - - - (21.51)<br />
Operating Profit before working capital changes 4,606.79 5,085.12 2,402.50 3,882.39 627.90<br />
Adjustment for<br />
Trade and Other Receivables (175.07) (1,554.62) 891.00 (1,365.76) 662.36<br />
Inventories (3,505.37) 1,164.19 (1,916.27) (2,379.58) 2,098.72<br />
Trade Payables 4,207.17 (537.18) 1,270.59 (2,655.61) 2,542.99<br />
526.73 (927.61) 245.32 (6,400.95) 5,304.07<br />
Cash generated from operations 5,133.52 4,157.51 2,647.82 (2,518.56) 5,931.97<br />
Direct Taxes (Paid) (102.07) (246.38) 49.36 48.33 (42.73)<br />
Cash flow before extra-ordinary item 5,031.45 3,911.13 2,697.18 (2,470.23) 5,889.24<br />
Extra Ordinary Item (4.97) (3.50) (4.45) (13.31) (16.54)<br />
NET CASH FROM OPERATING ACTIVITIES (A) 5,026.48 3,907.63 2,692.73 (2,483.54) 5,872.70<br />
(B) CASH FLOW FROM INVESTING ACTIVITIES:<br />
Purchase of Fixed Assets (4,669.13) (2,591.14) (1,762.27) (975.55) (579.70)<br />
Disposal of Fixed Assets 987.61 382.28 19.85 9.68 4,839.04<br />
Sale / Purchase of Investments (239.89) (2.31) 220.00 12.76 (2,499.96)<br />
Interest Received 269.22 3.80 6.62 327.57 -<br />
Dividend Received 3.35 1.00 0.07 3.85 0.36<br />
(3,648.84) (2,206.37) (1,515.73) (621.69) 1,759.74<br />
Net cash used in investing activities (B) (3,648.84) (2,206.37) (1,515.73) (621.69) 1,759.74<br />
(C) CASH FLOW FROM FINANCING ACTIVITIES<br />
Proceeds from Issue of Share <strong>Capital</strong> - - 1,219.99 1,487.88 -<br />
Share Application Money - - - 725.02 -<br />
Proceeds from Long Term borrowings 981.31 130.11 884.84 (503.41) (2,930.46)<br />
Repayment from Short Term borrowings (249.02) (227.89) (812.90) 797.89 (207.62)<br />
Interest paid (2,019.84) (1,817.26) (2,035.87) (2,251.82) (2,145.47)<br />
(C) (1,287.55) (1,915.04) (743.94) 255.56 (5,283.55)<br />
Net increase in cash and cash activities (A + B + C)<br />
90.09 (213.78) 433.06 (2,849.67) 2,348.89<br />
Cash and cash equivalents (Opening Balance) 1,734.06 1,947.84 1,514.78 4,364.45 2,015.56<br />
Cash and cash equivalents (Closing Balance) 1,824.15 1,734.06 1,947.84 1,514.78 4,364.45<br />
NET INCREASE / (DECREASE) AS DISCLOSED ABOVE 90.09 (213.78) 433.06 (2,849.67) 2,348.89<br />
7
GENERAL INFORMATION<br />
Our Company was incorporated as “Indian Organic Chemicals Limited” on February 10, 1960 under the<br />
Companies Act 1956. Our Company changed its name from Indian Organic Chemicals Limited to Futura<br />
Polyesters Limited, and pursuant to the change of our name, a fresh Certificate of Incorporation, bearing<br />
Registration number 11-11579 was issued on November 05, 2002. Our Company is registered with the RoC. –<br />
The CIN (Corporate Identification Number) of our Company is L65192MH1960PLC011579<br />
Name, Registered & Corporate office of our Company<br />
Futura Polyesters Limited<br />
Registered and Corporate Office:<br />
Paragon Condominium,<br />
3 rd Floor, Pandurang Budhkar Marg,<br />
Mumbai – 400 013, India<br />
Tel: +91-22-24922999<br />
Fax: +91-22-24923142<br />
Website: www.futurapolyesters.com<br />
Email: futuraho@futurapolyesters.com<br />
The address of the RoC is as follows:<br />
Registrar of Companies, Maharashtra at Mumbai<br />
100, Everest Building,<br />
Marine Drive,<br />
Mumbai – 400 002,<br />
Maharashtra, India.<br />
Board of Directors of our Company<br />
Our Board of Directors as on the date of filing the Draft Letter of Offer with SEBI is as follows:<br />
Sr.<br />
No.<br />
Name Designation Nature of Directorship DIN<br />
1. Mr. Shyam Bhupatirai Ghia Chairman and Managing Executive Director 00005264<br />
Director<br />
2. Mr. Mukund Dharamdas Dalal Joint Managing Director Executive Director 00005275<br />
3. Mr. Viren Rajan Raheja Director Non-Executive Director 00037592<br />
4. Mr. Sharad Shreepad Marathe Director Non-Executive Independent 00016935<br />
Director<br />
5. Mr. Prathipati Abraham Nominee Director Non-Executive Independent 00280426<br />
Director<br />
6. Mr. Vispi Rusi Patel Director Non-Executive Independent 00211464<br />
Director<br />
7. Mr. Shyam Sunder Sami Director Non-Executive Independent 00026470<br />
Director<br />
8. Mr. Nikhil Shyam Ghia Additional Director Non-Executive Director 00089258<br />
9. Mr. K. Ramasubramanian Additional Director Non-Executive Independent 01623890<br />
Director<br />
For a detailed profile of our Directors including our Executive Directors, please refer to the chapter titled ‘Our<br />
Management’ beginning on page 60 of the Draft Letter of Offer.<br />
Company Secretary & Compliance Officer<br />
Mr. S. Ramachandran<br />
Paragon Condominium,<br />
8
3 rd Floor, Pandurang Budhkar Marg,<br />
Mumbai – 400 013<br />
Tel: +91-22-24922999<br />
Fax: +91-22-24923142<br />
Email: rightsissue@futurapolyesters.com<br />
Note: Investors are advised to contact the Registrar to the Issue and/or Compliance Officer, Mr. S.<br />
Ramachandran, in case of any pre-Issue/post-Issue related problems such as non-receipt of Abridged Letter of<br />
Offer/Letter of Offer/letter of allotment/ CAF/share certificate(s)/refund order(s)/demat credit/electronic refund<br />
of funds.<br />
The Equity Shares of our Company are listed on BSE.<br />
Issue Management Team:<br />
Lead Manager to the Issue<br />
<strong>IDBI</strong> <strong>Capital</strong> Market Services Limited<br />
5 th Floor, Mafatlal Centre,<br />
Nariman Point,<br />
Mumbai – 400 021<br />
Tel.: +91-22-2289 7519/37<br />
Fax: +91-22-2283 8782<br />
Website: www.idbicapital.com<br />
E-Mail: futura.rights@idbicapital.com<br />
Investors Grievance ID: redressal@idbicapital.com<br />
Contact Person: Mr. Neelabh Dubey<br />
SEBI Registration No: INM000010866<br />
Legal Advisors to the Issue<br />
M/s. Crawford Bayley & Co<br />
Advocates and Solicitors<br />
State Bank Buildings, 4 th floor<br />
N.G.N Vaidya Marg,<br />
Fort, Mumbai - 400 023, India<br />
Tel: +91-22-2266 8000<br />
Fax: +91-22-2266 3978<br />
E-mail: sanjay.asher@crawfordbayley.com<br />
Registrars to the Issue / Share Transfer<br />
Agents of our Company<br />
Satellite Corporate Servies Pvt. Ltd.<br />
B- 302, Sony Apt., Opp. St. Jude's High School,<br />
Off. Andheri-Kurla Road, Jarimari,<br />
Sakinaka, Mumbai – 400072, India<br />
Tel: +91-22-28520461/28520462.<br />
Fax: +91-22-28511809.<br />
Website: www.scspl.net<br />
E-mail: service@scspl.net<br />
Contact Person: Mr. Michael Monterio<br />
SEBI Registration No: INM000003639<br />
Statutory Auditors<br />
M/s. N. M. Raiji & Co<br />
Chartered Accountants<br />
Universal Insurance Bldg,<br />
6th Floor, Sir. P. M. Road,<br />
Fort, Mumbai - 400001, India.<br />
Tel: +91-22-22870068 / 22873463<br />
Fax: +91-22-022-22828646.<br />
E-mail: nmraiji@mtnl.net.in<br />
Bankers to our Company<br />
BANK OF INDIA<br />
Bank of India Building,<br />
4 th Floor, 70/80, M.G. Road,<br />
Fort, Mumbai - 400 023, India.<br />
Tel: +91-22-2262 3656<br />
Fax: +91-22-2269 2196<br />
E-mail: mumbaicbb@bankofindia.co.in<br />
INDIAN BANK<br />
Harbour Branch,<br />
66 Rajaji Salai,<br />
Chennai - 600 001, India.<br />
Tel: +91-44-2521 0313<br />
Fax: +91-44-2521 5368<br />
E-mail: ibharbour@indianbank.co.in<br />
9
UNION BANK OF INDIA<br />
Union Bank Bhavan,<br />
1st floor, 239, Vidhan Bhavan Marg,<br />
Nariman Point, Mumbai 400 021, India.<br />
Tel: +91-22-2202 4742<br />
Fax: +91-22-2285 5037<br />
E-mail: jbdave@unionbankofindia.com<br />
STATE BANK OF HYDERABAD<br />
1st Floor,<br />
45, Second Line Beach,<br />
Chennai - 600 001, India.<br />
Tel: +91-44-2539 7118<br />
Fax: +91-44-2535 8322<br />
E-mail: sbhifbchn@vsnl.net<br />
STATE BANK OF INDIA<br />
N.G.N. Vaidya Marg,<br />
Fort, Mumbai - 400 023, India<br />
Tel: +91-22-6450 1295<br />
Fax: +91-22-2266 5915<br />
E-mail: pbp1950@hotmail.com<br />
CANARA BANK<br />
Spencers Tower - I,<br />
770, Ground Floor,<br />
Anna Salai, Chennai - 600 002, India.<br />
Tel: +91-44-2849 7011/ 12/ 13<br />
Fax: +91-44-2849 7016<br />
E-mail: chn2596@canbank.co.in<br />
UCO BANK<br />
T. Nagar<br />
Chennai - 600 017, India.<br />
Tel: +91-44-24357476<br />
Fax: +91-44-24357477<br />
E-mail: ucotnagarmcu@vsnl.net<br />
Bankers to the Issue<br />
[●]<br />
Refund Bankers<br />
[●]<br />
Inter-se Allocation of Responsibilities<br />
Since <strong>IDBI</strong> <strong>Capital</strong> Market Services Limited is the sole Lead Manager to the Issue, all the responsibilities of the<br />
Issue will be managed by them.<br />
Statement of Inter se allocation of responsibility<br />
<strong>IDBI</strong> <strong>Capital</strong> Market Services Limited is the sole Lead Manager to this Issue. However, the details of<br />
responsibility for <strong>IDBI</strong> <strong>Capital</strong> Market Services Limited are as follows:<br />
Sr. Activities<br />
No.<br />
1. <strong>Capital</strong> structuring with relative components and formalities such as type of instruments,<br />
etc.<br />
2. Drafting and Design of the Letter of Offer and of advertisement /publicity material<br />
including newspaper advertisements and brochure / memorandum containing salient<br />
features of the Letter of Offer. The designated Lead Merchant Banker shall ensure<br />
compliance with theGuidelines for Disclosure and Investor Protection and other stipulated<br />
requirements and completion of prescribed formalities with Stock Exchange and SEBI.<br />
3. Marketing of the Issue which will cover, inter alia, formulating marketing strategies,<br />
preparation of publicity budget, arrangements forselection of (i) ad-media and (ii) bankers<br />
to the issue.<br />
Responsibility &<br />
Co-ordinator<br />
<strong>IDBI</strong> <strong>Capital</strong><br />
Market Services<br />
Limited<br />
<strong>IDBI</strong> <strong>Capital</strong><br />
Market Services<br />
Limited<br />
<strong>IDBI</strong><br />
Market<br />
Limited<br />
10<br />
<strong>Capital</strong><br />
Services
4. Selection of various agencies connected with the issue, namely Registrars to the Issue,<br />
printers, bankers and advertisement agencies.<br />
5. The post-issue activities will involve essential follow-up steps, which must include<br />
finalization of basis of allotment / weeding out of multipleapplications, listing of<br />
instruments and dispatch of certificates and refunds, with the variousagencies connected<br />
with the work such as registrars to the issue, bankers to the issue, and bank handling<br />
refund business. Even if many of these post-issue activities would be handled by other<br />
intermediaries, the designated Lead Merchant Banker shall be responsible for ensuring<br />
that these agencies fulfill their functions and enable him to discharge this responsibility<br />
through suitable agreements with the issuer company.<br />
Credit Rating Details<br />
This being an issue of Equity Shares on rights basis, there is no credit rating required for this Issue.<br />
IPO Grading<br />
This being a rights issue and not an IPO, grading is not mandatory<br />
Debenture Trustees<br />
Since this is not a debenture issue, appointment of debenture trustee is not required.<br />
Monitoring Agency<br />
<strong>IDBI</strong><br />
Market<br />
Limited<br />
<strong>IDBI</strong><br />
Market<br />
Limited<br />
<strong>Capital</strong><br />
Services<br />
<strong>Capital</strong><br />
Services<br />
As the size of the Issue, will not exceed Rs. 50000 lacs, appointment of monitoring agency under clause 8.17 of<br />
the SEBI Guidelines is not required.<br />
Underwriting/ Standby Arrangements<br />
The present Issue is not underwritten and our Company has not made any standby arrangements for the present<br />
Rights Issue. Our Promoters have confirmed that they would subscribe to their respective entitlements in this<br />
Rights Issue in full. Further, our Promoters have also confirmed that they would also subscribe to the<br />
unsubscribed portion of this Issue, to the extent that minimum subscription of 90% of Issue size is achieved if<br />
any, in accordance with their undertaking contained in the chapter titled “<strong>Capital</strong> Structure” beginning on page<br />
12 of the Draft Letter of Offer.<br />
Minimum Subscription<br />
If our Company does not receive the minimum subscription of 90% of this Issue on the date of closure of the<br />
Issue, the entire subscription shall be refunded to the applicants within 42 days from the date of closure of this<br />
Issue. If there is a delay in the refund of subscription by more than 8 days after our Company becomes liable to<br />
pay the subscription amount (i.e. 42 days after closure of this Issue), our Company shall pay interest for the<br />
delayed period, at rates prescribed under sub-sections (2) and (2A) of Section 73 of the Companies Act 1956.<br />
Under-subscription in the Issue will be determined after considering the number of shares<br />
applied as per the entitlement plus additional shares applied by existing shareholders and the<br />
renouncees. The undersubscribed portion can be applied for only after the close of the Issue.<br />
Our Promoters, either by themselves or through their relatives or through one or more<br />
Promoter Group Entities, have undertaken to subscribe upto the extent of minimum<br />
subscription, i.e. 90% of the Issue size, if the Issue is undersubscribed to ensure that the Issue is<br />
successful. This acquisition of additional Equity Shares, if allotted as aforesaid shall be in terms<br />
of proviso to Regulation 3(1) (b) (ii) of the Takeover Code and will be exempt from the<br />
applicability of Regulations 11 and 12 of Takeover Code. This disclosure is made in terms of the<br />
requirement of Regulation 3(1) (b) (ii) of the Takeover Code. Further, this acquisition will not<br />
result in change of control of management of our Company.<br />
In case the permission to deal in and for an official quotation of the Equity Shares is not granted by the Stock<br />
Exchange, the Issuer shall forthwith repay without interest, all monies received from the applicants in pursuance<br />
of the Draft Letter of Offer and if such money is not repaid within eight days after the day from which the Issuer<br />
is liable to repay it, the Issuer shall pay interest as prescribed under Section 73(2) / 73(2A) of the Companies<br />
Act, 1956.<br />
11
CAPITAL STRUCTURE<br />
PARTICULARS AS ON THE DATE OF THE DRAFT LETTER OF OFFER<br />
Amount<br />
(Rs. in<br />
lacs)<br />
Authorised Share <strong>Capital</strong><br />
7,90,00,000 Equity Shares of Rs. 10/- each 7900.00<br />
1,00,000 Cumulative Redeemable Preference Shares of Rs. 100/- each 100.00<br />
Issued, Subscribed & Paid-up Share <strong>Capital</strong><br />
5,24,21,679 Equity Shares of Rs 10/-each fully paid- up 5242.16<br />
Present issue being offered to the existing Shareholders through the Letter of Offer in the ratio of<br />
one Equity Share for every two Equity Shares held on the Record Date<br />
2,62,10,839 Equity Shares of Rs. 10/- each issued at par 2621.08<br />
Paid-up <strong>Capital</strong> after the Rights issue<br />
7,86,32,518 Equity Shares of Rs. 10/- each fully paid-up (Assuming full subscription) 7863.25<br />
Securities Premium Account<br />
Existing Securities Premium Account (pre-Issue) 4,441.96<br />
On allotment of proposed Rights Issue (post-Issue) 4,441.96<br />
Notes to capital structure<br />
1. Details of increase/changes in Authorised Share <strong>Capital</strong> since incorporation<br />
Date Authorized <strong>Capital</strong> Increased/changed from Authorized <strong>Capital</strong> Increased/changed to<br />
4,00,000 Equity Shares of Rs. 100/- each<br />
aggregating to Rs. 400 lacs.<br />
September<br />
01, 1969<br />
September<br />
08, 1976<br />
August 22,<br />
1979<br />
September<br />
23, 1981<br />
August 08,<br />
1985<br />
September<br />
16, 1992<br />
April 08,<br />
2005<br />
July 15 , ,<br />
2008<br />
4,00,000 Equity Shares of Rs. 100/- each and<br />
1,00,000 Cumulative Redeemable Preference<br />
Shares of Rs. 100/- each aggregating to Rs. 500<br />
lacs<br />
6,50,000 Equity Shares of Rs. 100/- each and<br />
1,00,000 Cumulative Redeemable Preference<br />
Shares of Rs. 100/- each aggregating to Rs. 750<br />
lacs<br />
10,00,000 Equity Shares of Rs. 100/- each and<br />
1,00,000 Cumulative Redeemable Preference<br />
Shares of Rs. 100/- each aggregating to Rs. 1100<br />
lacs<br />
1,00,00,000 Equity Shares of Rs. 10/- each and<br />
1,00,000 Cumulative Redeemable Preference<br />
Shares of Rs. 100/- each aggregating to Rs. 1100<br />
lacs<br />
2,40,00,000 Equity Shares of Rs. 10/- each and<br />
1,00,000 Cumulative Redeemable Preference<br />
Shares of Rs. 100/- each aggregating to Rs. 2500<br />
lacs<br />
4,90,00,000 Equity Shares of Rs. 10/- each and<br />
1,00,000 Cumulative Redeemable Preference<br />
Shares of Rs. 100/- each aggregating to Rs. 5000<br />
lacs<br />
540,00,000 Equity Shares of Rs. 10/- each and<br />
1,00,000 Cumulative Redeemable Preference<br />
Shares of Rs. 100/- each aggregating to Rs. 5500<br />
lacs<br />
4,00,000 Equity Shares of Rs. 100/- each and<br />
1,00,000 Cumulative Redeemable Preference<br />
Shares of Rs. 100/- each aggregating to Rs. 500<br />
lacs<br />
6,50,000 Equity Shares of Rs. 100/- each and<br />
1,00,000 Cumulative Redeemable Preference<br />
Shares of Rs. 100/- each aggregating to Rs. 750<br />
lacs<br />
10,00,000 Equity Shares of Rs. 100/- each and<br />
1,00,000 Cumulative Redeemable Preference<br />
Shares of Rs. 100/- each aggregating to Rs. 1100<br />
lacs<br />
1,00,00,000 Equity Shares of Rs. 10/- each and<br />
1,00,000 Cumulative Redeemable Preference<br />
Shares of Rs. 100/- each aggregating to Rs. 1100<br />
lacs<br />
2,40,00,000 Equity Shares of Rs. 10/- each and<br />
1,00,000 Cumulative Redeemable Preference<br />
Shares of Rs. 100/- each aggregating to Rs. 2500<br />
lacs<br />
4,90,00,000 Equity Shares of Rs. 10/- each and<br />
1,00,000 Cumulative Redeemable Preference<br />
Shares of Rs. 100/- each aggregating to Rs. 5000<br />
lacs<br />
5,40,00,000 Equity Shares of Rs. 10/- each and<br />
1,00,000 Cumulative Redeemable Preference<br />
Shares of Rs. 100/- each aggregating to Rs. 5500<br />
lacs<br />
7,90,00,000 Equity Shares of Rs. 10/- each and<br />
1,00,000 Cumulative Redeemable Preference<br />
Shares of Rs. 100/- each aggregating to Rs. 8000<br />
lacs<br />
2. Share <strong>Capital</strong> History from Incorporation till date of filing of the Draft Letter of Offer:<br />
12
Year/Date of<br />
Allotment/Split<br />
Year/Date<br />
when<br />
made<br />
fully paid<br />
up<br />
No. Of<br />
Equity<br />
Shares<br />
Face<br />
Value<br />
(Rs.)<br />
Issue<br />
Price<br />
(Rs.)<br />
Value (Rs.) Consideration Remarks Cumulative<br />
number of<br />
shares<br />
1960 – 61 1960 – 61 40,000 100 100 40,00,000 Cash Initial 40,000 Nil<br />
<strong>Capital</strong><br />
1962 – 63 1962 – 63 10,000 100 100 10,00,000 Cash Rights 50,000 Nil<br />
1:4<br />
1969 – 70 1969 – 70 20,000 100 N.A 20,00,000 Other than Bonus 70,000 Nil<br />
Cash<br />
2:5 (by<br />
capitalization<br />
of General<br />
Reserves<br />
1970 – 71 1971-72 2,60,725 100 100 2,60,72,500 Cash Public Issue 3,30,725 Nil<br />
Cumulative<br />
Securities<br />
Premium<br />
(Rs.)<br />
1976 – 77 1976 – 77 1,65,362 100 N.A 1,65,36,200 Other than<br />
Cash<br />
1979 – 80 1979 – 80 2,48,043 100 N.A 2,48,04,300 Other than<br />
Cash<br />
September 23,<br />
1981<br />
N.A 74,41,300<br />
Bonus 1:2<br />
(by<br />
capitalization<br />
of General<br />
Reserves)<br />
Bonus1:2<br />
(by<br />
capitalization<br />
of General<br />
Reserves)<br />
Split of 1 share of Rs. 100 each into 10 shares of Rs.10 each<br />
4,96,087 Nil<br />
7,44,130 Nil<br />
74,41,300 Nil<br />
March 01, 1983 March 01, 3,50,000 10 10 35,00,000 Other than Shares<br />
1983<br />
Cash<br />
issued to<br />
shareholders<br />
of erstwhile<br />
Corp Bank<br />
due to<br />
merger<br />
1983-84 1983-84 3,58,215 10 20 71,64,300 Cash Conversion<br />
of<br />
Debentures<br />
1985 – 86 June 30,<br />
1985<br />
1,55,535 10 25 38,88,375 Cash Conversion<br />
of 12%<br />
convertible<br />
debentures<br />
1985-86 1985-86 41,52,525 10 N.A 4,15,25,250 Other than<br />
Cash<br />
issued to<br />
shareholders<br />
of Corp<br />
Bank<br />
Bonus1:2<br />
(by<br />
capitalization<br />
of General<br />
Reserves)<br />
77,91,300 Nil<br />
81,49,515 35,82,150<br />
83,05,050 59,15,175<br />
1,24,57,575 23,33,025<br />
March 16, 1988 March 16, 59,42,425 10 15 8,91,30,375 Cash Rights 1,84,00,000 3,20,45,150<br />
1988<br />
1:2<br />
November November 46,55,100 10 25 11,63,77,500 Cash Conversion 2,30,55,100 10,18,71,650<br />
29,1992<br />
of Partly<br />
Convertible<br />
Debentures<br />
May 10, 1993 1993-94 92,22,040 10 30 27,66,61,200 Cash Rights 3,22,77,140 28,63,12,450<br />
July 19, 1994 1995-96 12,00,000 10 78 9,36,00,000 Cash Preferential 3,34,77,140 36,28,55,000<br />
issue<br />
November 19, November 1,48,78,729 10 10 14,87,87,290 Cash Rights 4,83,55,869 36,28,55,000<br />
2004<br />
19, 2004<br />
April 08, 2005 April 08, 33,78,460 10 29 9,79,75,340 Cash Preferential 5,17,34,329 42,70,45,740<br />
13
September 09,<br />
2005<br />
2005 issue<br />
September 6,87,350 10 34.95 2,40,22,882.50 Cash Preferential<br />
09, 2005<br />
issue<br />
5,24,21,679 44,41,95,123<br />
3. Shareholding Pattern before and the expected shareholding pattern after the Issue is as under:<br />
4. Shareholding Pattern of our Company as on July 04, 2008<br />
Total<br />
number<br />
of<br />
shares<br />
Pre-Issue<br />
Total<br />
shareholding as<br />
a percentage of<br />
total number of<br />
shares<br />
Total<br />
number<br />
of shares<br />
Post-<br />
Issue<br />
Total<br />
shareholding<br />
as a<br />
percentage of<br />
total number<br />
of shares<br />
Category of Shareholder<br />
Shareholding of Promoter and<br />
Promoter Group<br />
Indian<br />
Individuals/ Hindu Undivided Family 441228 0.84 [•] [•]<br />
Bodies Corporate 19946864 38.05 [•] [•]<br />
Sub Total(A)(1) 20388092 38.89 [•] [•]<br />
[•]<br />
[•]<br />
Foreign 0 0.00 [•] [•]<br />
[•]<br />
[•]<br />
Public shareholding [•] [•]<br />
Institutions [•] [•]<br />
Mutual Funds/ UTI 157489 0.30 [•] [•]<br />
Financial Institutions / Banks 25821 0.05 [•] [•]<br />
Insurance Companies 3355114 6.40 [•] [•]<br />
Foreign Institutional Investors 93270 0.18 [•] [•]<br />
Non-institutions [•] [•]<br />
Bodies Corporate 3234373 6.17 [•] [•]<br />
Individuals [•] [•]<br />
Individuals –<br />
[•]<br />
[•]<br />
i. Individual shareholders holding<br />
nominal share capital up to Rs 1 lakh 13231561 25.24<br />
ii. Individual shareholders holding<br />
[•]<br />
[•]<br />
nominal share capital in excess of Rs. 1<br />
lakh. 7411459 14.14<br />
Any Other (specify) [•] [•]<br />
Trusts 16277 0.03 [•] [•]<br />
Directors & Relatives 2740 0.01 [•] [•]<br />
Non resident Indians 1224245 2.34 [•] [•]<br />
Clearing Member 95517 0.18 [•] [•]<br />
Hindu Undivided families 892031 1.70 [•] [•]<br />
Overseas Corporate Bodies 2293690 4.38 [•] [•]<br />
Total Public Shareholding (B) 32033587 61.11 [•] [•]<br />
TOTAL (A)+(B) 52421679 100.00 [•] [•]<br />
[•]<br />
[•]<br />
(C) Shares held by Custodians and<br />
[•]<br />
[•]<br />
against which Depository Receipts<br />
have been issued 0 0.00<br />
Pre & Post – Issue <strong>Capital</strong> (Total<br />
[•]<br />
[•]<br />
(A)+(B)+(C)) 52421679 100<br />
GRAND TOTAL (A)+(B)+(C) 52421679 100 [•] [•]<br />
14
As on date of the Draft Letter of Offer, there are 39,364 shareholders (as per the beneficial position as on July<br />
04, 2008), while 53,71,011 Equity Shares are held in physical form and 4,70,50,668 Equity Shares are held in<br />
demat form.<br />
Our Promoters have confirmed that each of them intend to subscribe to the full extent of their entitlement in the<br />
Issue. Our Promoters reserve their right to subscribe to their entitlement in the Rights Issue either by themselves,<br />
their relatives or through one or more Promoter Group Entities, including by subscribing for renunciation, if<br />
any, made by any of the Promoters to any other Promoter and/ or an affiliate thereof. Our Promoters may apply<br />
for additional Equity Shares in the Issue. As a result of this subscription and consequent allotment as stated<br />
above, the Promoters (and others as mentioned above) may acquire shares over and above their entitlement in<br />
the Issue, which may result in an increase of the shareholding being above the current shareholding with the<br />
entitlement of Equity Shares under the Issue.<br />
This subscription and acquisition of additional Equity Shares by the Promoter(s) (and others as mentioned<br />
above), if any, will not result in change of control of the management of our Company and shall be exempt in<br />
terms of the proviso to Regulation 3(1)(b)(ii) of the Takeover Code. As such, other than meeting the<br />
requirements indicated in the section on “Objects of the Issue” of the Draft Letter of Offer, there is no other<br />
intention/ purpose for this Issue, including any intention to delist our Company, even if, as a result of allotments<br />
to our Promoters (and others as mentioned above) in this Issue, the Promoters’ and Promoter group shareholding<br />
in our Company exceeds their current shareholding.<br />
Our Promoters have provided the following undertaking, in terms of the SEBI (Delisting of Securities)<br />
Guidelines, 2003:<br />
“We undertake that, in case the Rights Issue of Futura Polyesters Limited is undersubscribed as on the Issue<br />
Closing Date, we shall individually, or jointly with or through our relative(s) or Promoter Group entity /<br />
entities, subscribe over and above our entitlement in this Rights Issue to the undersubscribed portion of this<br />
Rights Issue to the extent that minimum subscription of 90% of the Issue size is achieved, to ensure that the<br />
Issue is successful, in compliance with the Listing Agreement and other applicable laws prevailing at that time<br />
relating to continuous listing requirements.”<br />
“We hereby undertake that, in case the Rights Issue of Futura Polyesters Limited is completed with the<br />
Promoters subscribing (either by ourselves or through one or more persons / entities mentioned above) to Equity<br />
Shares over and above their entitlement in order to meet the subscription to the extent of minimum subscription<br />
i.e 90% of the Issue size as stated hereinabove and as a result, if the public shareholding falls below the<br />
permissible minimum level as specified in the listing conditions or listing agreement, we shall, individually or<br />
jointly with our relative(s) or promoter group entity/ entities who or which may have acquired shares in the<br />
Company including pursuant to any renunciation of the whole or part of our entitlement by any Promoter(s),<br />
make an offer for sale of our holding (including that of person/ entity refer to above), so that the public<br />
shareholding is raised to the “permissible minimum level” within a period of three months from the date of<br />
allotment in the proposed Issue, as per the requirements of Clause 17.1 and 17.2 of SEBI (Delisting of<br />
Securities) Guidelines, 2003 or as per any amendment thereto or any other period as may be directed by SEBI or<br />
any appropriate authority.”<br />
5. Details of shareholding of Promoters and Promoter Group as on date of filing the Draft Letter of<br />
Offer:<br />
S. Name of person/entity<br />
Number of Equity Shares % of pre-Issue paid up<br />
No.<br />
held as on date<br />
share capital<br />
Promoters<br />
1. Mr. Shyam Bhupatirai Ghia 1012 0.00<br />
2. Mr. Mukund Dharamdas Dalal 255744 0.49<br />
Promoter Group<br />
Dharamdas Sitaldas Dalal 22815 0.04<br />
Deepika Subhash Chandratreya 37155 0.07<br />
Bela M Dalal 53662 0.10<br />
Nikhil Shyam Ghia 70623 0.13<br />
Rajul Shyam Ghia 217 0.00<br />
Bhupati Investments and Finance<br />
Private Limited 6525471 12.45<br />
15
Bloomingdale Investment & Finance<br />
5307311 10.12<br />
Private Limited<br />
Chika Private Limited 7000 0.01<br />
Daltreya Investment & Finance Private<br />
26992 0.05<br />
Limited<br />
Distributors (Bombay) Private Limited 2144904 4.09<br />
Gokul Construction Company Private<br />
1500080 2.86<br />
Limited<br />
Matsyagandha Investment and Finance<br />
Private Limited<br />
4435106 8.46<br />
6. <strong>Capital</strong> build-up of our Promoters is as follows:<br />
The capital build-up of our Promoters, to the extent of information available with our Company and with<br />
them, is as follows:<br />
(i) Mr. Shyam Bhupatirai Ghia<br />
Opening Balance Date/Year No. of Shares Purchase/Sale Closing Balance<br />
700 1995 0 700<br />
April 19, 2004 312 1,012<br />
As on date 0 1,012<br />
(ii) Mr. Mukund Dharamdas Dalal<br />
Opening<br />
Balance<br />
Date/Year<br />
No. of Shares<br />
Purchase/Sale<br />
Purchase /sale value<br />
(Rs.)<br />
Closing<br />
Balance<br />
16600 January 11, 1982 1800 61.50 18400<br />
(Bonus) 1985 8250 0 26650<br />
(Bonus) 1985 950 0 27600<br />
1987 250 42.50 27850<br />
November 28,<br />
7132 25 34982<br />
1992<br />
May 10, 1993 14240 15 49222<br />
January 31, 1996 6000 78 55222<br />
Sep, 1998 (6000) 6 49222<br />
March 30, 2000 (2000) 6.53 47222<br />
Sep, 2000 50000 14 97222<br />
March 31, 2001 (16600) 0 80622<br />
March 31, 2001 (3000) 5.70 77622<br />
February 23,<br />
15000 16.05 92622<br />
2004<br />
February 26,<br />
10000 14.05 102622<br />
2004<br />
March 3, 2004 3425 14.05 106047<br />
March 8, 2004 5069 14.00 111116<br />
March 11, 2004 5121 13.91 116237<br />
March 13, 2004 16600 13.50 132837<br />
March 15, 2004 5000 11.94 137837<br />
March 9, 2004 3556 13.75 141393<br />
(Rights) November 19,<br />
105851 10 247244<br />
2004<br />
March 28, 2008 8500 255744<br />
7. Details regarding Top 10 Shareholders:<br />
16
The details of top 10 shareholders and the number of shares held by them are as below:<br />
A. As on date of filing the Draft Letter of Offer with the Stock Exchange*<br />
Sr. No Name of Shareholder Number of Shares % holding<br />
1. Bhupati Investments and Finance Private Limited 6525471 12.45<br />
2. Bloomingdale Investment and Finance Private Limited 5307311 10.12<br />
3. Matsyagandha Investment and Finance Private Limited 4435106 8.46<br />
4. Life Insurance Corporation of India 2410352 4.60<br />
5. Distributors (Bombay) Private Limited 2144904 4.09<br />
6. Persiphone Investments Limited 1683616 3.21<br />
7. Gokul Construction Company Private Limited 1500080 2.86<br />
8. Mr. Sudhir Keshavji Sampat 778727 1.49<br />
9. United India Insurance Company Limited 573871 1.09<br />
10. Mr. Dipak Kanayalal Shah 528600 1.01<br />
Total 25887092 49.38<br />
*As of the beneficial position as on July 04, 2008<br />
B. 10 days prior to filing the Draft Letter of Offer with the Stock Exchange*.<br />
Sr. No Name of Shareholder Number of Shares % holding<br />
1. Bhupati Investments and Finance Private Limited 6525471 12.45<br />
2. Bloomingdale Investment and Finance Private Limited 5307311 10.12<br />
3. Matsyagandha Investment and Finance Private Limted 4435106 8.46<br />
4. Life Insurance Corporation of India 2410352 4.60<br />
5. Distributors (Bombay) Private Limted 2144904 4.09<br />
6. Persiphone Investments Ltd 1683616 3.21<br />
7. Gokul Construction Company Private Limted 1500080 2.86<br />
8. Mr. Sudhir Keshavji Sampat 778727 1.49<br />
9. United India Insurance Company Limited 573871 1.09<br />
10. Mr. Dipak Kanayalal Shah 528100 1.01<br />
Total 25887092 49.38<br />
*As of the beneficial position as on June 27, 2008<br />
C. Two years prior to filing the Draft Letter of Offer with the Stock Exchange*<br />
Sr. No. Name of Shareholder Number of Shares % holding<br />
1. Bhupati Investments and Finance Private Limited 6513611 12.43<br />
2. Bloomingdale Investment and Finance Private Limited 5307311 10.12<br />
3. Matsyagandha Investment and Finance Private Limited 4435106 8.46<br />
4. Life Insurance Corporation of India 2410352 4.60<br />
5. Persiphone Investments Ltd 1683616 3.21<br />
6. Industrial Development Bank Of India Limited 1531384 2.92<br />
7. Gokul Construction Company Private Limited 1500080 2.86<br />
8. HSBC Financial Services (Middle East) Limited 1068608 2.04<br />
9. United India Insurance Company Limited 887078 1.69<br />
10. Mr. Sudhir Keshavji Sampat 774052 1.69<br />
Total 26111052 50.03<br />
*As of the beneficial position as on June 30, 2006<br />
8. Details of purchase and sale of securities of our Company by the Promoters, Promoter Group<br />
Entities and Directors, in the last 6 months:<br />
17
Other than as stated hereinbelow, there are no cases of purchase or sale of Equity Shares of our Company<br />
by our Promoters, their immediate relatives, Directors and Promoter Group Entities in the six months<br />
before the date of the Draft Letter of Offer:<br />
Name<br />
of<br />
Promoter/Promoter<br />
Group/immediate relative,<br />
Directors<br />
Mr. Mukund Dharamdas<br />
Dalal<br />
Purchase/<br />
acquisition<br />
Sale<br />
Price<br />
(Rs.)<br />
Name<br />
of<br />
transferor/transferee<br />
8,500 NA 25 Transferor: Mr.<br />
Dharamdas Dalal<br />
Date of<br />
transfer<br />
March<br />
28, 2008<br />
Final<br />
shareholding<br />
2,55,744<br />
Transferee: Mr. Mukund<br />
Dharamdas Dalal<br />
Ms. Deepika S. Chandratreya 2500 NA 25 Transferor: Ms. Kusum<br />
D. Dalal<br />
Transferee: Ms. Deepika<br />
S. Chandratreya<br />
March<br />
28, 2008<br />
37,155<br />
9. The present Issue being a rights issue, as per Clause 4.10.1.(c) SEBI Guidelines, the requirement of<br />
Promoters contribution and lock-in are not applicable.<br />
10. Revaluation of Assets<br />
a) Year 2003-2004:<br />
As our Company’s Plant and Machinery were installed over a period of time during the life of our Company<br />
since its formation, the management decided to revalue the same so as to reflect the appropriate value in the<br />
books of accounts. Accordingly, our Company appointed a Government certified Valuer, namely, M/s<br />
Kanti Karamsey & Co. to revalue the Plant and Machinery at both locations, namely Chennai and Khopoli.<br />
The revaluation was carried out on November 30, 2003, with the intention to assess the intrinsic value of<br />
the plant and machinery. The net increase in the net book value arising out of revaluation has been credited<br />
to Revaluation Reserve Account.<br />
Details of the Revaluation of Assets are here as under:<br />
1 Gross Book Value was computed to be Rs. 38, 618.10 lacs<br />
2 Accumulated Depreciation was computed to be Rs. 18, 198.34 lacs<br />
3 Net Book Value was computed to be Rs. 20, 419.76 lacs<br />
4 Net Revaluation was computed to be Rs. 4145.12 lacs<br />
Total Replacement Cost as on November 30, 2003 was assessed to be Rs. 2199. 73 lacs and the Fair Market<br />
Value then was estimated to be Rs. 1336.62 lacs<br />
b) Year 2007- 2008:<br />
During the year 2007-2008 our Company appointed M/s. Kanti Karamsey & Co. for the purpose of<br />
revaluation of part of the land. The same was performed on February 16, 2008. The net increase in the net<br />
book value arising out of revaluation has been credited to the Revaluation Reserve Account. Revaluation is<br />
based on the Valuation Report of M/s. Kanti Karamsey & Co. dated February 18, 2008.<br />
Details of the Revaluation of part of the land<br />
1 Gross Book Value was computed to be Rs. 5.28 lacs<br />
2 Accumulated Depreciation was computed to be Nil<br />
3 Net Book Value was computed to be Rs. 5.28 lacs<br />
4 Net Revaluation was computed to be Rs. 14, 089.94 lacs<br />
However, our Company has not utilized the Revaluation Reserve Account for issuing any bonus shares or<br />
declaration of dividends as on date of the Draft Letter of Offer.<br />
11. No further issue of capital whether by way of issue of bonus shares, preferential allotment, rights issue or in<br />
any other manner intended to be made by our Company during the period commencing from submission<br />
of the Draft Letter of Offer with SEBI till the securities referred to in the Draft Letter of Offer have been<br />
18
listed, or application money is refunded on account of failure of the Issue, except that if we enter into<br />
acquisition(s) or joint venture(s), we may consider additional capital to fund such activities or to use Equity<br />
Shares as a currency for such acquisition(s) or participation in such joint venture(s).<br />
12. Our Company presently does not have any intention or proposal to alter its capital structure within a period<br />
of six months from the date of opening the Issue by way of split/consolidation of the denominations of<br />
Equity Shares or further issue of shares or other securities.<br />
13. Our Company does not have any ESOP/ESPS scheme as on date.<br />
14. If our Company does not receive the minimum subscription of 90% of this Issue, which is payable on<br />
application), on the date of closure of the Issue, the entire subscription shall be refunded to the applicants<br />
within 42 days from the date of closure of this Issue. If there is a delay in the refund of subscription by<br />
more than 8 days after our Company becomes liable to pay the subscription amount (i.e. 42 days after<br />
closure of this Issue), our Company shall pay interest for the delayed period, at rates prescribed under subsections<br />
(2) and (2A) of Section 73 of the Companies Act 1956. For details, please refer to the paragraph<br />
titled “Basis of Allotment” beginning on page 232 of the Draft Letter of Offer.<br />
Under-subscription in the Issue will be determined after considering the number of shares applied as per the<br />
entitlement plus additional shares applied by existing shareholders and the renouncees. The<br />
undersubscribed portion can be applied for only after the close of the Issue. Our Promoters, either by<br />
themselves or through their relatives or through one or more Promoter Group Entities, have undertaken to<br />
subscribe upto the extent of minimum subscription, i.e. 90% of the Issue size, if the Issue is<br />
undersubscribed to ensure that the Issue is successful. This acquisition of additional Equity Shares, if<br />
allotted as aforesaid shall be in terms of proviso to Regulation 3(1) (b) (ii) of the Takeover Code and will be<br />
exempt from the applicability of Regulations 11 and 12 of Takeover Code. This disclosure is made in terms<br />
of the requirement of Regulation 3(1) (b) (ii) of the Takeover Code. Further, this acquisition will not result<br />
in change of control of management of our Company.<br />
15. Our Company has 39,364 Equity Shareholders as on the date of filing of the Draft Letter of Offer (as per<br />
beneficial position as on July 04, 2008)<br />
16. At any given point of time there shall be only one denomination for the Shares of our Company and we<br />
shall comply with such disclosure and accounting norms as may be prescribed by SEBI from time to time.<br />
17. The Equity Shares would be traded in dematerialised form and the minimum trading lot for Equity Shares<br />
shall be one<br />
18. Our Company has not raised any bridge loan against the proceeds of this Issue.<br />
19. Our Company, our Promoters, our Directors and the Lead Manager has not entered into any buyback or<br />
standby arrangements with respect to Equity Shares being offered in this Issue.<br />
20. The Rights Entitlement of our Promoters will be fully subscribed.<br />
21. The Issue will remain open for 30 days. However, the Board will have the right to extend the Issue period<br />
as it may determine from time to time but not exceeding 60 days from the Issue Opening Date.<br />
22. Equity Shares offered through this Issue shall be fully paid-up on allotment and the entire amount of Rs. 10<br />
(Face Value of Rs. 10/- each per Equity Share since the Issue is at par) is payable on application<br />
23. All the Equity Shares of our Company issued are fully paid up as on date and there are no partly paid up<br />
Equity Shares.<br />
24. No payment, direct or indirect in the nature of discount, commission, and allowance or otherwise shall be<br />
made either by us or our Promoters to the persons who receive allotments, if any, in this Issue.<br />
19
OBJECTS OF THE ISSUE<br />
Our Company intends to use the proceeds of the present Rights Issue of 2,62,10,839 Equity Shares aggregating<br />
to Rs. 2,621.08 lacs for meeting the objectives as discussed below:<br />
(a) Funding working capital requirements;<br />
(b) General corporate purposes;<br />
(c) Issue expenses.<br />
The net proceeds of the Issue, after deduction of any Issue expenses, are estimated to be approximately Rs. [•]<br />
lacs.<br />
The main objects clause of the Memorandum of Association of our Company enable us to undertake our<br />
existing activities and the activities for which funds are being raised by us through this Issue. Further we<br />
confirm that the activities which we have been carrying out till date are in accordance with the objects clause of<br />
the Memorandum of Association of our Company.<br />
Fund Requirement:<br />
The intended use of the proceeds of the Issue is as under: -<br />
Sr. No<br />
Particulars<br />
Amount<br />
(Rs. in lacs)<br />
1 Funding working capital requirements 2,092.00<br />
2 General corporate purposes [●]<br />
3 Issue expenses [●]<br />
Total 2,621.08<br />
Means of finance:<br />
The fund requirements hereinabove shall be met in the following manner:<br />
Sr. No Particulars<br />
Amount<br />
(Rs. in Lacs)<br />
1 Gross proceeds of the Issue 2,621.08*<br />
2 Less: Issue related expenses [●]<br />
3 Net proceeds of the Issue [●]<br />
* Our Promoters have confirmed that they shall subscribe to their respective entitlements in this Rights Issue in<br />
full.<br />
Our Promoters, either by themselves or through their relative(s) or one or more Promoter Group Entities, shall<br />
apply for additional Equity Shares in the Issue to the extent that 90% of the Issue size i.e minimum subscrpition<br />
is achieved to ensure that the Issue is successful. As a result of such subscription and consequent allotment, our<br />
Promoters may acquire Equity Shares over and above their Rights Entitlement, which may result in an increase<br />
of their shareholding being above the current shareholding with the Rights Entitlement of Equity Shares in this<br />
Issue. Such subscription and acquisition of additional Equity Shares by our Promoter(s) (including through<br />
persons / entities refered to hereinbove), if any, will not result in change of control of the management of our<br />
Company and shall be exempted in terms of proviso to Regulation 3(1)(b)(ii) of the Takeover Code.<br />
Notes:<br />
a) The fund requirement and intended use of net proceeds of the Issue is described herein is as per our<br />
managements’ estimate and have not been appraised by any bank or financial institution.<br />
b) In case of any shortfall in raising the requisite capital from the proceeds of the Issue, the extent of the<br />
shortfall will be met by internal accruals.<br />
c) In case of any increase/decrease in the Issue expenses, we may use such surplus towards general<br />
corporate purposes/meet the deficit from the amount earmarked towards general corproate purposes.<br />
21
d) Since the objects of the Issue are proposed to be financed out of Issue proceeds, the requirement of an<br />
undertaking confirming that firm arrangements of finance through verifiable means towards 75% of the<br />
stated means of finance, excluding the amount proposed to be raised through the Rights Issue, is not<br />
applicable<br />
e) In case of any variations in the actual utilization of funds earmarked for the above activities, increased<br />
fund deployment for a particular activity may be met with by other funding sources, including surplus<br />
funds if any available in any other project of our Company and/or our Company’s internal accrual, and<br />
/ or the term loans/working capital loans that may be availed from the banks/ financial institutions.<br />
f) In case the Rights Issue does not go as planned, our Company will make alternative arrangements like<br />
availing of fresh loans from bank(s) and/or utilizing internal accruals.<br />
Details of Use of Proceeds<br />
1. Funding working capital requirements<br />
We need additional working capital in line with our expanding operations. We have assessed our working<br />
capital requirement for the financial year 2008-2009 to be Rs. 6,592 lacs. The details of funding our<br />
working capital requirement as per our estimates are as follows:<br />
(Rs. In lacs)<br />
Particulars No. of Days 2008-2009 (Estimated)<br />
(A) Current Assets<br />
Raw materials, stock in process, finished goods 49<br />
9,782.00<br />
Receivables 30 5,274.00<br />
Advances to suppliers, other advances and other current asset -<br />
6,184.00<br />
Total Current Assets 21,240.00<br />
(B) Current Liabilities<br />
Sundry Creditors and other current liabilities 63 14,648.00<br />
(C) Working <strong>Capital</strong> Gap (A-B) 6,592.00<br />
Actual/ projected bank borrowing 4,500.00<br />
Net working capital Gap 2,092.00<br />
Rights Issue Funding 2,092.00<br />
Presently we have been sanctioned fund based working capital limits of Rs. 4,500.00 lacs. For further<br />
details, please refer chapter titled “Financial Indebtedness” beginning on page 45 of the Draft Letter of<br />
Offer.<br />
2. General Corporate Purposes<br />
Our Company intends to deploy the balance Issue proceeds, after meeting Issue expenses, aggregating to<br />
Rs. [•] Lacs towards general corporate purposes, including entering into strategic alliances, partnership,<br />
brand building, repayment of debt, human resource development and training costs, research &<br />
development, meeting exigencies and contingencies in ordinary course of business which may not be<br />
foreseen or any other purpose as approved by our Board of Directors from time to time.<br />
3. To meet Issue expenses<br />
The total expenses of this Issue are estimated to be approximately Rs. [●]. The Issue related expenses<br />
include, amongst others, issue management fees, brokerage (if any) and printing and distribution expenses,<br />
legal fees, advertisement expenses, registrar and depository fees and listing expenses .<br />
Sr. No<br />
Particulars<br />
Amount<br />
(Rs. in lacs)<br />
1 Fees of Lead Manager, Registrar to Issue, Legal Advisor etc. [●]<br />
2 Advertisement and marketing expenses [●]<br />
22
3 Printing, stationery, distribution, postage etc [●]<br />
4 Others (including but not limited to Stock Exchage and SEBI filing fees) [●]<br />
Total<br />
[●]<br />
Deployment of funds:<br />
Break-up of the utilization of Issue proceeds and the year wise deployment is given below:<br />
Sr. No.<br />
Particulars<br />
Amount<br />
(Rs. in lacs)<br />
Year ending March 31<br />
2009 2010 Total<br />
1 Funding working capital requirements 2,092.00 - 2,092.00<br />
2 General corporate purposes [●] [●] [●]<br />
3 Issue expenses [●] - [●]<br />
Total [●] [●] [●]<br />
Deployment of Funds<br />
Our Company has not deployed any amount towards the said objects of the Issue as on date.<br />
Interim Use of Proceeds:<br />
Our management, in accordance with the policies established by the Board, will have flexibility in deploying the<br />
proceeds received from the Issue. Pending utilization of the proceeds out of the Issue for the purposes described<br />
above, our Company intends to temporarily invest the funds in high quality interest bearing liquid instruments<br />
including money market mutual funds, deposits with banks for necessary duration and other interest bearing<br />
securities as may be approved by the Board. Such investments would be in accordance with the investment<br />
policies approved by our Board from time to time.<br />
Monitoring Utilization of Funds<br />
As our Issue size is less than Rs. 50,000 lacs, we have not appointed any monitoring agency to monitor the<br />
utilization of Issue proceeds, as the same is not required as per SEBI Guidelines. Our Board of Directors will<br />
monitor the utilization of proceeds of this issue on a regular basis.<br />
We will disclose the utilization of the Issue proceeds including interim use, under a separate head in our balance<br />
sheet or otherwise if required for the applicable fiscal periods clearly specifying the purpose for which such<br />
proceeds have been utilized as per the disclosure requirements of listing agreement with the Stock Exchange.<br />
23
BASIS FOR ISSUE PRICE<br />
The Issue Price has been determined in consultation with the Lead Manager to the Issue considering following<br />
qualitative and quantitative factors. Investors should also refer to the section titled “Risk Factors” and<br />
“Financial Statements” beginning on page viii and 111 respectively to get a more informed review before<br />
making the investment division.<br />
Qualitative factors<br />
1 Experienced Promoters supported by qualified management team<br />
2 In-house research and development facilities<br />
3 Established marketing network<br />
4 Diverse product mix<br />
5 Focus on specialty segment<br />
For more details, please refer to the chapter titled “Business Overview” beginning on page 31 and section titled<br />
“Risk Factors” beginning on page viii of the Draft Letter of Offer respectively.<br />
Quantitative factors<br />
Information presented in this section is derived from our Company’s restated, financial statements prepared in<br />
accordance with Indian GAAP.<br />
Weighted average earnings per share (EPS)<br />
Financial period EPS (Rs.) Weight<br />
Financial year 2006 (1.89) 1<br />
Financial year 2007 2.14 2<br />
Financial year 2008 2.17 3<br />
Weighted average 1.48<br />
Notes:<br />
1 The earnings per share has been computed on the basis of adjusted profits and losses for the respective<br />
years / periods after considering the impact of accounting policy changes, prior period adjustments /<br />
re-groupings pertaining to earlier years as per the auditors report.<br />
2 The denominator considered for the purpose of calculating Earnings Per Share is the weighted<br />
average number of Equity Shares outstanding during the year.<br />
3 The face value of each equity share is Rs. 10.<br />
Price/earning (P/E) ratio<br />
1 Based on the financial year ended March 31, 2008, EPS is Rs. 2.17.<br />
2 P/E based on EPS, for the year ended March 31, 2008 is 4.61.<br />
3 Industry P/E*:<br />
(a) Highest: 49.90<br />
(b) Lowest: 3.70<br />
(c) Average: 24.60<br />
(*Source: <strong>Capital</strong> Market – Vol. XXIII/08 June 16 – June 29, 2008, Segment – Textile - Manmade)<br />
Weighted average return on net worth*<br />
Financial period Return on average net worth<br />
Weight<br />
(%)<br />
Financial year 2006 (10.45) 1<br />
24
Financial year 2007 8.84 2<br />
Financial year 2008 8.57 3<br />
Weighted average 5.49<br />
* Net worth has been computed by aggregating share capital, reserves and surplus and adjusting for revaluation reserves, intangible assets and<br />
deferred tax assets as per our audited restated financial statements.<br />
Minimum return on increased net worth required to maintain pre-Issue EPS<br />
The minimum return on increased net worth required to maintain pre-Issue EPS as on March 31, 2008 is 9.24 %.<br />
NAV per Equity Share<br />
NAV per Equity Share represents shareholders’ equity less miscellaneous expenses as divided by weighted<br />
average number of Equity Shares. The NAV per Equity Share at March 31, 2008 is Rs. 25.09.<br />
NAV per Equity Share after the Issue<br />
The NAV per Equity Share after the Issue is Rs. 20.06.<br />
The Issue Price per Equity Share is Rs. 10 / -.<br />
Comparison of accounting ratios as of March 31, 2008<br />
Company<br />
EPS<br />
(Rs.)<br />
P/E<br />
Return on average<br />
net worth (%)<br />
Book value per<br />
share (Rs.)<br />
Futura Polyesters Limited 2.17 4.610 8.57 25.09<br />
Century Enka 6.60 16.00 3.30 225.10<br />
Indo Rama Synthetic India Limited 0.80 16.60 2.70 37.20<br />
(*Source: <strong>Capital</strong> Market – Vol. XXIII/08 June 16 – June 29, 2008, Segment – Textile - Manmade)<br />
*Our EPS, return on average net worth and book value per share have been calculated from our audited financial statements.<br />
The Face Value of the shares is Rs. 10 /- per share and the Issue Price of Rs. 10 is 1 time the face value of<br />
Equity Shares.<br />
Based on the above mentioned qualitative, quantitative factors and market price of the Equity Shares of our<br />
Company, we and the Lead Manager to the Issue, are of the opinion that the Issue Price of Rs. 10 per Equity<br />
Shares is reasonable and justified.<br />
Share Prices of Futura Polyesters Limited<br />
Weekend prices of Equity Shares of our Company for the last four weeks on BSE along with the highest and the<br />
lowest prices are as below:<br />
Week ended on Closing Price Highest Price Lowest Price<br />
July 04, 2008 23.10 23.70 21.00<br />
June 27, 2008 22.00 22.50 20.80<br />
June 20, 2008 23.00 25.90 22.90<br />
June 13, 2008 23.95 24.60 23.70<br />
Market Price as on May 30, 2008 is 28.30.<br />
25
STATEMENT OF TAX BENEFITS<br />
The Board of Directors,<br />
Futura Polyesters Limited,<br />
Paragon Condominium, 3 rd Floor,<br />
Pandurang Budhkar Marg,<br />
Mumbai 400 013<br />
Dear Sirs,<br />
BENEFITS UNDER THE INCOME TAX ACT, 1961 (hereinafter referred to as the ‘Act’)<br />
TO THE COMPANY<br />
1) In accordance with the provisions of section 10(38) of the ‘Act” the long-term capital gains arising<br />
from the transfer of securities / units in a transaction entered into in a recognized stock exchange in<br />
India (such transaction is chargeable to Securities Transaction Tax under Chapter VII of the Finance<br />
(No.2) Act, 2004), shall be exempt from income tax. However, the said exemption will not be<br />
allowable as deduction from Book Profits under Section 115 JB of the Act.<br />
2) The long-term capital gains accruing to the Company otherwise than as mentioned in A. 1) above, shall<br />
be chargeable to tax in accordance with and subject to the provisions of section 112 of the Act as<br />
follows:<br />
i. If long-term capital gain is computed after indexation @ 20% (plus applicable Surcharge and<br />
Education Cess).<br />
ii. If long-term capital gain is computed without indexation @ 10% (plus applicable Surcharge and<br />
Education Cess).<br />
3) The short-term capital gains accruing to the Company, from the transfer of a short-term capital asset,<br />
being securities, in a transaction entered into in a recognized stock exchange in India (such transaction<br />
is chargeable to Securities Transaction Tax under Chapter VII of the Finance (No.2) Act, 2004) shall be<br />
chargeable to tax at the rate of 15% [plus applicable Surcharge and Education Cess] as per the<br />
provisions of section 111A of the Act.<br />
4) The Company is eligible to claim exemption in respect of tax on long term capital gains under sections<br />
54EC of the Act, if the amount of capital gains is invested in certain specified bonds/securities subject<br />
to the fulfillment of the conditions specified in those sections upto a ceiling of fifty lakh rupees.<br />
5) The Company is eligible to exemption under section 10(34) of the Act in respect of income by way of<br />
dividend received from other Domestic Companies.<br />
6) The Company is eligible to exemption under section 10(35) of the Act in respect of income by way of<br />
dividend received from mutual fund specified under Section 10(23D) of the Act and other specified<br />
undertakings/companies.<br />
TO THE MEMBERS OF THE COMPANY<br />
B I – RESIDENTS<br />
1) Members will be entitled to exemption, under section 10(34) of the Act in respect of the income by<br />
way of dividend received from the Company.<br />
2) The long-term <strong>Capital</strong> gains accruing to the members of the Company on sale of the Company’s shares<br />
in a transaction entered into in a recognized stock exchange in India (such transaction is chargeable to<br />
Securities Transaction Tax under Chapter VII of the Finance (No.2) Act, 2004) shall be exempt from<br />
tax as per the provisions of section 10(38) of the Act.<br />
3) The long term capital gains otherwise than as mentioned in (2) above, shall be chargeable to tax in<br />
accordance with and subject to the provisions of Section 112 of the Act as follows:<br />
i. If long term capital gain is computed after indexation @ 20% (plus applicable surcharge and<br />
education cess).<br />
26
ii. If long term capital gain is computed without indexation @ 10% (plus applicable surcharge<br />
and education cess)<br />
4) The short-term <strong>Capital</strong> gains accruing to the members of the Company on sale of the Company’s shares<br />
in a transaction entered into in a recognized stock exchange in India (such transaction is chargeable to<br />
Securities Transaction Tax under Chapter VII of the Finance (No.2) Act, 2004) shall be chargeable to<br />
tax @ 15% [plus applicable surcharge and education cess] as per the provisions of section 111A of the<br />
Act.<br />
5) The members are entitled to claim exemption in respect of tax on long term capital gains under sections<br />
54EC of the Act, if the amount of capital gains is invested in certain specified bonds/securities subject<br />
to the fulfillment of the conditions specified in those sections upto a ceiling of fifty lakhs rupees.<br />
6) Individuals or HUF members can avail exemption under section 54F of the Act by utilization of the<br />
sales consideration for purchase/construction of a residential house within the specified time period and<br />
subject to the fulfillment of the conditions specified therein.<br />
II – NON-RESIDENTS<br />
1. Non-resident members will be entitled to exemption, under section 10(34) of the Act in respect of<br />
the income referred to in Section 115-O of the Act, by way of dividend received from the<br />
Company.<br />
2. Benefits outlined in Paragraph B I (2) above are also available to a non-resident/non-resident<br />
Indian shareholder to Section 48 of the Act<br />
3. Benefits outlined in Paragraph B I (4) above are also applicable to the non-resident / non-resident<br />
Indian shareholder:<br />
4. Where shares have been subscribed in convertible foreign exchange, the non-resident Indians [as<br />
defined in Section 115C(e) of the Act], being shareholders of an Indian Company, have the option<br />
of being governed by the provisions of Chapter XII-A of the Act, which inter alia, entitles them to<br />
the following benefits in respect of income from shares of an Indian Company acquired, purchased<br />
or subscribed to convertible foreign exchange:<br />
• As per the provisions of Section 115D read with Section 115E of the Act and subject to the conditions<br />
specified therein, long term capital gains (in cases not covered under Section 10(38) of the Act) arising on<br />
transfer of an Indian Company’s shares, will be subject to tax at the rate of 10 percent (plus applicable<br />
surcharge on tax and education cess on tax and surcharge), without indexation benefit.<br />
• As per the provisions of Section 115F of the I.T.Act and subject to the conditions specified therein, gains<br />
arising on transfer of a long term capital asset (in cases not covered under Section 10 (38) of the Act) being<br />
shares in an Indian Company shall not be chargeable to tax if the entire net consideration received on such<br />
transfer is invested within the prescribed period of six months in any specified asset or savings certificates<br />
referred to in Section 10(4B) of the Act. If part of such net consideration is invested within the prescribed<br />
period of six months in any specified asset or savings certificates referred to in Section 10(4B) of the Act,<br />
then such gains would not be chargeable to tax on a proportionate basis. For this purpose, net consideration<br />
means full value of the consideration received or accrued as a result of the transfer of the capital asset<br />
(being shares in the Indian Company) as reduced by any expenditure incurred wholly and exclusively in<br />
connection with such transfer.<br />
5. As per the provisions of Section 115G of the Act, non-resident Indians are not obliged to file a<br />
return of income under Section 139(1) of the Act, if their only source of income is income from<br />
investments or long term capital gains earned on transfer of such investments or both, provided,<br />
tax has been deducted at source from such income as per the provisions of chapter XVII-B of the<br />
Act.<br />
6. Under Section 115H of the Act, where the non-resident Indian becomes assessable as a resident in<br />
India, he may furnish a declaration in writing to the Assessing Officer, along with his return of<br />
income for that year under Section 139 of the I.T. Act to the effect that the provisions of the<br />
Chapter XII-A shall continue to apply to him in relation to such investment income derived from<br />
the specified assets for that year and subsequent assessment years until such assets are converted<br />
into Indian Currency.<br />
27
7. As per the provisions of Section 115 I of the Act, a non-resident Indian may elect not to be<br />
governed by the provisions of chapter XII-A for any assessment year by furnishing his return of<br />
income for that assessment year under Section 139 of the Act, declaring therein that the provisions<br />
of chapter XII-A shall not apply to him for that assessment year and accordingly his total income<br />
for that assessment year will be computed in accordance with the other provisions of the Act.<br />
8. Benefits outlined in Paragraph B I (5), (6) above are also available to a non-resident/non-resident<br />
Indian shareholder.<br />
III. Foreign Institutional Investors (FIIs)<br />
1. Dividend income, received from the domestic Company shall be exempt under Section 10(34) of the Act.<br />
2. <strong>Capital</strong> Gains<br />
Under Section 115AD, income (other than income by way of dividends referred in Section 115-O) received<br />
in respect of securities (other than units referred to in Section 115A) shall be taxable at the rate of 20%<br />
(plus applicable surcharge on tax and education cess on tax and surcharge).<br />
Under Section 115AD, capital gains arising from transfer of securities (other than units referred to in<br />
Section 115AB) which are not exempt under Section 10(38), shall be taxable as follows:<br />
Securities which are held for the period of upto or less than twelve months and where such transaction is<br />
chargeable to securities Transaction Tax, capital gain shall be taxable at the rate of 15% (plus applicable<br />
surcharge on tax and education cess on tax and surcharge). Securities other than those held for the period of<br />
upto or less than twelve months and where such transaction is not chargeable to Securities Transaction Tax,<br />
capital gain shall be taxable at the rate of 30% (plus applicable surcharge on tax and education cess on tax<br />
and surcharge);<br />
Securities which are held for the period of more than twelve months shall be taxable at the rate of 10% (plus<br />
applicable surcharge on tax and education cess on tax and surcharge). Such capital gains would be<br />
computed without giving effect of first proviso and without indexation as provided in the second proviso to<br />
Section 48.<br />
3. Long-term capital gains arising on transfer of equity shares in our Company, which is held for the period of<br />
more than twelve months and where such transaction is chargeable to Securities Transaction Tax, shall be<br />
exempt from tax under Section 10(38) of the Act.<br />
4. Benefit of exemption under Section 54EC shall be available as outlined in Paragraph B (I) (5) above.<br />
BENEFITS UNDER THE WEALTH TAX ACT, 1957<br />
‘Asset’ as defined under section 2(ea) of the Wealth Tax Act, 1957, does not include shares in Companies and<br />
hence, shares are not liable to wealth tax.<br />
BENEFITS UNDER THE GIFT-TAX ACT, 1958<br />
Gift tax is not leviable in respect of any gifts made on or after October 1, 1998. Therefore any gift of shares will<br />
not attract gift tax.<br />
Note<br />
1 Our comments are based on the law as of date. Tax rates mentioned above are that which are currently<br />
applicable. Tax laws are subject to changes from time to time and as such any changes may affect the<br />
advice contained in our opinion. We have no responsibility to update our advice for events and<br />
circumstances occurring after the date of this opinion, unless specifically requested by you.<br />
2 In respect of non-residents, the tax rates and the consequent taxation above shall be subject to any<br />
further benefits available under the double taxation avoidance agreements, if any, between India and<br />
the country in which the non-resident has fiscal domicile.<br />
For N. M. Raiji and Co.,<br />
Chartered Accountants<br />
Place: Mumbai<br />
Date: June 10, 2008<br />
CA. Y. N. Thakkar<br />
Partner<br />
Membership No. 33329<br />
28
SECTION IV – ABOUT US<br />
INDUSTRY OVERVIEW<br />
Petrochemicals are derived from various chemical compounds, mainly from hydrocarbons. These hydrocarbons<br />
are derived from crude oil and natural gas. Among the various fractions produced by distillation of crude oil,<br />
petroleum gases, naphtha, kerosene and gas oil are the main feed stocks for petrochemical industry. Ethane,<br />
propane and natural gas liquids obtained from natural gas are the other important feedstock used in the<br />
Petrochemicals industry. Petrochemical industry plays a vital role in economic growth and development of<br />
manufacturing sector. The value addition in the petrochemicals industry is higher than most of the other industry<br />
sectors.<br />
The Petrochemical industry, which entered in the Indian industrial scene in 1970s, registered a rapid growth in<br />
the 1980s and 1990s. Petrochemical industry mainly comprise of synthetic fibre / yarn, polymers, Synthetic<br />
Rubber, Synthetic detergent intermediates, performance plastics and plastic processing industry.<br />
Today, petrochemical products permeate the entire spectrum of daily use items and cover almost every sphere of<br />
life like clothing, housing, construction, furniture, automobiles, household items, agriculture, horticulture,<br />
irrigation, packaging, medical appliances, electronics and electrical etc.<br />
Global Scenario<br />
The world is witnessing a gradual shift in the production and demand for petrochemicals from West to East.<br />
Availability of abundant cheap raw material in Middle East and emergence of Asia as the major consumption<br />
centre had witnessed an enhanced investment flow to these regions. India and China are expected to be the<br />
major growth centres in the course of next two decades.<br />
The global ethylene capacity in 2006 increased at 4.4% whereas the demand grew by a healthy 5.6%. During<br />
2006, five new crackers were brought on stream with one each in Brazil and the Middle East and three in China.<br />
In addition, six crackers have undergone major de-bottlenecking / expansions.<br />
A strong global economy supported by robust growth in two of the largest economies, China and India will also<br />
help to swiftly absorb the additional products coming out of these new capacities in the Middle East and Asia.<br />
IMF predicts the global GDP to maintain a healthy growth of 5.1% during 2007 as well as through 2008. A<br />
major impetus to this growth will come from the Asian region with China and India being the main contributors.<br />
This will support a healthy demand growth for petrochemical products.<br />
Global Polymer Market<br />
Globally demand for all polymers reached 175 million tonnes of which PE, PP and PVC accounted for 142<br />
million tonnes showing a healthy growth of 5.9%. The growth was mainly driven by LLDPE (7%), HDPE<br />
(6.1%) and PP(6.4%). Asia, Africa and other developing regions had been the primary contributors to this<br />
growth. The global production capacity of PE, PP and PVC touched 162 million tonnes with growth of 5.2%.<br />
Globally, 8 million tonnes of capacity was added during 2006 of which 6 million tonnes was Polyolefins and 2<br />
million tonnes of PVC. The major capacity additions were in China and in the Middle East.<br />
Global Polyester Market<br />
The year 2006-07 was a challenging one for the polyester industry. Rising crude oil prices impacted an increase<br />
in the cost of raw materials while a bumper cotton crop accompanied by subsidised cotton prices exerted<br />
pressure on polyester margins. Stand-alone polyester producers across the world were affected substantially<br />
during the year. The demand in Asia is estimated to grow by 2.4 million tonnes or by 6% in 2007 and 2008<br />
while capacity will increase by only 1.7 million tonnes. The ability of polyester producers across Asia to<br />
successfully pass through higher costs in 2006 gives an early indication of the emerging strength of the sector.<br />
The slow-down in the new polyester capacity expansions accompanied by increase in the demand is expected to<br />
improve the capacity utilisation in polyester operations. The industry is at an early stage of a multi-year upcycle.<br />
29
India Scenario<br />
Consumption of PE, PP and PVC (three major polymers) in India reached 4.6 million tonnes registering a y-o-y<br />
growth of 10% during FY 2006-07. PP and LLDPE registered a healthy growth of 15%. LDPE consumption<br />
grew at 8% whereas HDPE grew at 9% and PVC witnessed a modest growth of 7%. The demand for PVC in<br />
India experienced a 7% y-o-y growth.<br />
The production performance of major petrochemicals during 2001-02 to 2005-06 is as follows:<br />
Units in Kilo Tons<br />
Sub-group 2001-02 2002-03 2003-04 2004-05 2005-06<br />
Annualized<br />
Growth Rates(%)<br />
Synthetic Fiber 1667 1755 1868 1875 1906 3.4<br />
Polymers 3974 4175 4499 4776 4768 4.7<br />
Elastomers 79 81 87 97 110 8.63<br />
Synthetic<br />
Detergent 425 447 453 488 556 7.0<br />
Intermediates<br />
Performance<br />
Plastics<br />
90 95 99 113 127 9.0<br />
Total 6235 6553 7007 7349 7467 4.61<br />
Source: Ministry of Chemicals and Fertilizers-Petrochemicals<br />
Polyester fibers are the most widely used synthetic fibers in the world today. Polyester fibers, however, have<br />
poor elasticity and stretch recovery, do not absorb moisture, are comparatively difficult to dye, and generate<br />
static electricity under dry conditions. However, many of the deficiencies of polyester filament yarn and staple<br />
fibre can be reduced or overcome by fiber modification and/or by blending with cotton or other fibers. Hightenacity<br />
polyester filament yarn and staple fibre have a higher tensile strength and a lower elongation before<br />
break than conventional polyester fiber. High-tenacity polyester fibers are used for both industrial and textile<br />
applications for which high strength and low crimp are important.<br />
Textile exports from India to the developed countries have increased in the post quota regime. A rise in the<br />
domestic textile consumption with the aid of a high GDP growth and changing lifestyle patterns is helping the<br />
consumption of polyester. The emergence of retail boom is boosting the demand for innovative products from<br />
the end consumers who have not experienced such products earlier. Cotton prices are expected to remain firm in<br />
the year ahead with limited growth in crop production thereby leading to a higher cotton-price environment.<br />
This typically has a positive impact on the polyester business both from a demand perspective (higher polyester<br />
blending) and pricing perspective.<br />
The current capacities of Synthetic Fibre and Commodity Polymers are depicted below:<br />
Synthetic Fibre Capacities July 2007 (3168 kilo tons)<br />
Source: Ministry of Chemicals and Fertilizers-Petrochemicals<br />
1%<br />
4%<br />
33%<br />
60%<br />
2%<br />
AF NFY NY/TC PFY PSF<br />
30
Kilo Tons<br />
3000<br />
2500<br />
2000<br />
1500<br />
1000<br />
500<br />
0<br />
2509<br />
1395<br />
1181<br />
1005<br />
800<br />
640<br />
48 68 114 38 87 50 121<br />
1 17 5<br />
100 120<br />
13 12 25<br />
2005-06 2006-07 2011-12<br />
PFY PSF NFY NIY/TC PIY AF PPFY<br />
Synthetic Fibre Demand Projections<br />
Source: Ministry of Chemicals and Fertilizers-Petrochemicals<br />
PET<br />
PET is eco-friendly and inert which has established itself as the polymer of the future in most packaging<br />
applications, especially in food and beverage packaging. It is widely used in packaging of soft drinks, water,<br />
edible oil, food products, juices, dairy beverages, pharmaceuticals, toiletries etc.<br />
The overall worldwide demand of PET resin continues to grow with the increasing demand of plastic and PET<br />
packaging. The total world demand for PET resin is estimated to be 14.6 million tons in 2010 as compared to<br />
10.0 million tons in 2005-06. In India also the market for PET Resin is growing steadily. The demand of PET<br />
resin is also influenced by seasonal factors and the growth pattern of the food processing and FMCG sectors.<br />
31
BUSINESS OVERVIEW<br />
Our Company was incorporated as a public limited company in Maharashtra under the name Indian Organic<br />
Chemicals Limited in February 1960 and commenced business on April 22, 1960. We commenced<br />
manufacturing operations at our plant at Khopoli, Maharashtra, for production of alcohol-based chemicals like<br />
Acetic Acid, Acetic Anhydride, Acetaldehyde and Ethyl Acetate, Benzyl products, Plasticizers and Glyoxal.<br />
In 1972, we set up a plant at Manali, Chennai, for manufacture of Polyester Fibres with an installed capacity of<br />
6,100 MT per annum. By 1986, the capacity was expanded to 38,500 MT per annum. Subsequently, a 9,175 MT<br />
of Polyester Filament Yarn (POY) plant was also set up. The POY business was discontinued after 1995 due to<br />
its uneconomic size and the plant had since been disposed off.<br />
With the launching of petro-based chemicals in 1990s and liberalization of molasses usage for potable alcohol,<br />
our industrial alcohol-based facility at Khopoli lost its competitive edge. The chemicals business had to be<br />
phased out gradually over a period of time. We however, succeeded in adapting and using our facilities at<br />
Khopoli to undertake knowledge based activities like custom synthesis, contract manufacture and contract R&D.<br />
As this new activity is “knowledge based”, requiring a different focus, our Company decided to transfer the<br />
chemicals division at Khopoli to another entity called Innovassynth Technologies (India) Limited. The term<br />
“knowledge based” means any activity, which requires use of specialised knowledge of the employees. In India<br />
skilled manpower like scientists, chemists and engineers are easily available at competitive rates. Innovassynth<br />
Technologies (India) Limited is engaged in Customs Synthesis, Contract manufacture and Contract R&D work<br />
which requires specialised knowledge of Chemistry and as such it has to rely on the specialist employees having<br />
the requisite qualifications and experience.<br />
With the separation of chemical business of our Company as above, our Polyester business at Chennai started<br />
focusing on Speciality Fibres, Speciality Polymers and Preforms. In order that the name of our Company<br />
correctly reflects the core business in which it is engaged in, our Company changed its name to “Futura<br />
Polyesters Limited” which became effective from November 05, 2002. (“Futura” is the registered trade mark of<br />
our Company under which it markets its products.)<br />
During the year 1993, our Company commenced production of PET Resin and Preforms at Manali, Chennai,<br />
under the name Futura Polymers Limited, as a joint venture with PepsiCo, USA, through its investment arm<br />
Transmere Inc., Mauritius. Subsequently during the year 1998, PepsiCo Inc. quit the joint venture. During the<br />
year 2002, Futura Polymers Limited was amalgamated with our Company.<br />
Our Company has one manufacturing facility at Chennai, currently consistingof three major activities, namely,<br />
Polyester Staple Fibres/Chips, PET Resins and PET Preforms. The installed capacities of these as on March 31,<br />
2008 are as under:<br />
Product<br />
Installed Capacity in MT per<br />
annum<br />
Polyester Staple Fibre / Chips 38,500<br />
Solid State Polymers 57,000<br />
PET Preforms 20,000<br />
We had established a subsidiary called Futura Industries Limited (FIL) to carry out Development on PET<br />
recycling and commercialise the technology for recycling of Polyester fibre waste and PET bottle scrap into<br />
polyester feed stock. Initially, the factory was located at Tiruvellore, near Chennai. FIL was carrying out the<br />
operations on job work basis for our Company for some time and the facilities were shifted, during 1997 from<br />
Tiruvellore to the main factory located at Manali, Chennai. In the year 2001, FIL was amalgamated with our<br />
Company. Presently, the PET recycling activity is being carried out at our factory at Manali, Chennai.<br />
Our Competitive Strengths<br />
1 Experienced Promoters supported by qualified management team<br />
Our Promoters Mr. Shyam Bhupatirai Ghia and Mr. Mukund Dharamdas Dalal are well qualified and<br />
possess vast industry experience of more than three decades. Our management team also possesses the<br />
requisite qualifications and experience commensurate with their responsibilities. As of March 31, 2008<br />
our total employee strength is 827. We aim to recruit talented employees and assist them in further<br />
development of their skills and expertise.<br />
32
2 Inhouse Research and Development facilities<br />
Our inhouse Research and Development (R&D) facilities enable us to produce innovative and quality<br />
products. Experts in the relevant fields are employed to carryout continuous development activity to<br />
produce specialty products to cater to varied customers’ needs. Our R&D efforts have led us in the<br />
development of products such as Special Hot Fill Resin for fruit juice application, Special Wave-PET<br />
Resin for dual ovenable trays, Special Jar PET Resin as Poly Carbonate substitute for five gallon water<br />
jars, Beer PET Resin for tunnel pasteurisable Beer with CO 2 , O 2 barrier, Easy Dyeable Resin/V-Flex<br />
Resin for textile applications, Green PET Resin with 20% recycled content, Heavy metal free Resin<br />
and Resin for pasteurisable juice containers and such specialised applications. Our R&D efforts have<br />
led us to patenting process for producing Fast Reheat Bottle Grade PET Resin and product patent<br />
pertaining to Thermo Plastic Crystalline PET. Since we operate in a dynamic industry, our R&D efforts<br />
are continuous so as to supplement our product base with newer and quality products.<br />
3 Established marketing network<br />
We have a well-established marketing network present in India and abroad. We market our Preforms<br />
and Resin products directly to our customers and Fibre products primarily through commission agents.<br />
Presently, we have eleven commission agents in India and nine outside India. We market our products<br />
in Europe, Middle East, USA and South East Asian countries. We interact with our customers on a<br />
regular basis to understand their specific needs and latest trends in the industry so as to serve them<br />
better.<br />
4 Diverse product mix<br />
Our diverse product mix enables us to serve varied customers’ needs in a short span of time. We have<br />
presence in Polyester Fibres, PET Resins and Preforms products. Our Polyester fibre products are<br />
speciality coloured fibres. We are able to change our product mix to suit our customers’ needs quickly<br />
due to our flexible batch product lines. We have through our R&D efforts developed speciality fibres<br />
like V-Flex High Shrink, Flame retardant moisture management and special effects fibres. We also<br />
manufacture products like Polyester Tow, Tops and Low Pill Fibres. Polymer products cover the entire<br />
range of Polyesters namely, PET, PEN, PTT, PBT, PTN, PBN. Our PET Preforms are used by bottling<br />
units for blowing into bottles of different sizes for filling juices, carbonated beverages and water. We<br />
have developed speciality performs for small Carbonated Soft Drink, beer and Pasteurable containers.<br />
5 Focus on Specialty segment<br />
We are focused on specialty niche segment, as we believe that our margins can improve by targeting<br />
customers in that segment. Based on our understanding of the dynamic nature of the industry in which<br />
we operate, we devise our business strategy accordingly. It is realized that the Commodity PET Resin<br />
market is increasingly turning regional and exports are going to be increasingly difficult. Nevertheless,<br />
we have completed R&D initiative to launch a wide range of Speciality PET Resins such as Fast<br />
Reheat Resin for High Speed blow moulding, Hot Fill Resin for fruit juice application, Wave PET<br />
Resin for dual ovenable trays, Jar PET Resin as Poly Carbonate substitute for five gallon water jars,<br />
Beer PET Resin for Beer with C0 2 /0 2 barrier, cationic dyeable resin easy dyeable resin for textile<br />
applications, Green PET Resin, with 20% recycled content for US eco-label compliance and heavy<br />
metal free Resin.<br />
Collaborations/tie-ups/associations<br />
As on the date of the Draft Letter of Offer, we have not entered into any collaboration/tie-ups/association<br />
33
Manufacturing Process<br />
Polyester Staple Fibres/Chips<br />
The main raw materials used are PTA, MEG, PET/PTT Chips and Alloys thereof. The manufacturing process<br />
consists of three stages, viz., Polymerization, Spinning and Draw Line. In Polymerization, the major raw<br />
materials are mixed in specific ratio and catalysts are added to produce Polyester Chips. PET/PTT Chips and<br />
other resins in primary forms are obtained from Polymer Division in the same location. In the spinning stage,<br />
these Polyester Chips/Polyester Melt are extruded and sent through spinnerets and spun tow is produced and<br />
collected in tow cans. The spun tow collected in tow cans are drawn further in the draw-line and finally crimped<br />
into various out lengths of fibre to suit the requirements.<br />
Raw Materials<br />
Mixing<br />
Catalysts<br />
Extrusion<br />
Polymerisation Spinning Draw Line<br />
Solid State Polymers<br />
The main raw materials used are PTA, NDC, MEG, PDO and BDO. The plant comprises of two sections, one is<br />
the Amorphous Section for Melt Poly Condensation and the other is for Solid-state polymerisation of<br />
Amorphous Chips. The product range has been diversified to cover the entire range of Polyesters, namely PET,<br />
PEN, PTT, PBT, PTN, PBN and allied Co-polyesters.<br />
Raw Materials<br />
Melt Poly<br />
Condensation<br />
Solid State<br />
Polymerisation<br />
PET Preforms<br />
The main raw material used for manufacturing Preforms is PET Resin. PET Resin is processed through state-ofthe-art<br />
Husky Injection Moulding Systems for production of Preforms, which is primarily sold to<br />
bottling/beverage companies.<br />
Research and Development<br />
Our R&D facilities are approved by Department of Scientific and Industrial Research (“DSIR”) . Experts in the<br />
relevant fields are employed to carryout continuous development activity to produce specialty products to cater<br />
to varied customers’ needs. We also have ISO 9001:2000 certification for our factory operations and ISO 14001<br />
for our environmental management system.<br />
Raw materials and Utilities<br />
The information below pertains to our production facilities located at Manali in Chennai, as follows:<br />
Sr. No. Manufacturing Location Product Manufactured<br />
1 1, Kamarajar Salai, Manali, Chennai Polyester Fibre<br />
2 1-A, Kamarajar Salai, Manali, Chennai Polymer<br />
3 1-A/1, Kamarajar Salai, Manali, Chennai Preforms<br />
Polyester Staple Fibre (PSF)<br />
34
The major raw materials used in the manufacture are PTA, MEG and Polyester Chips. We also use PET<br />
Polymers in other primary forms. PTA and MEG are available in the domestic market, but are generally<br />
imported from Middle East and other countries.<br />
Polyester Polymers<br />
The basic raw materials are PTA, NDC, MEG, PDO and BDO besides Isophthalic. NDC, PDO and BDO are<br />
imported, as they are not available in India.<br />
PET Preforms<br />
The raw material for the Perform business is the PET Resin which is produced in-house as well as procured<br />
from other sources. Speciality resins are produced in-house as and when required.<br />
Water<br />
Our water requirement is about 3,19,000 Kilo Litres. We draw water from Chennai Metropolitan Water Supply<br />
and Sewearage Board as well as from 22 borewells located in our facility which is sufficient for our<br />
requirement.<br />
Power<br />
Particulars<br />
Maximum Demand (MD)<br />
Stand by DieselGenerator sets<br />
G.T. Unit co-generation<br />
Total Power Consumption<br />
Sourced from IPP through TNEB Grid<br />
Capacity<br />
7.50 MVA<br />
3.90 MW<br />
4 MW<br />
7 MM Units / Month<br />
3.75 MM Units / Month<br />
Steam<br />
Particulars<br />
Bio Mass Steam Boiler<br />
Bio Mass Heater for Thermic Energy<br />
Capacity<br />
24 Tons / hour<br />
Back up available with Furnace Oil based boiler<br />
Manpower<br />
13 MKCal / hour<br />
As on March 31, 2008, our Company has 827 employees.<br />
Details of Manpower in our Plant in Chennai:<br />
Division-wise break-up of manpower is as under:<br />
Divisions No. of Employees<br />
Fibres 440<br />
Polymers 167<br />
Preforms 43<br />
Common 153<br />
Total 803<br />
35
Details of Employees in the Corporate Office situated at Mumbai:<br />
Apart from the Chairman and the Joint Managing Director, the employees in the corporate office are 22 in number<br />
as per the details given below:<br />
Particulars<br />
No. of Employees<br />
Administration 12<br />
Finance and Accounts 7<br />
Secretarial and Legal 3<br />
Total 22<br />
Environmental Aspects<br />
Our Company has Environment Health and Safety procedure in place. It has a zero effluents discharge system<br />
in operation and no effluent discharges into land or out of the factory. The effluents generated, both industrial<br />
and sewage are treated in the Effluent Treatment Plant, employing the Activated Sludge Process (ASP). The<br />
treated effluent meets all the parameters as prescribed by Environment Protection Act, 1986 and the Tamil Nadu<br />
Pollution Control Board. The Treatment of Effluent through the use of Ultra Filteration / RO Unit and the<br />
treated effluent is used as feed water for process and boiler feed water applications. The excess treated effluents<br />
is transferred to Tamil Nadu Petro Products Limited, which is 4 Kms away from the facility through pipeline for<br />
use in their manufacture in place of fresh water, duly approved by Tamil Nadu Pollution Control Board<br />
The effluent treatment is based on activated sludge process. The basic principle of this process is that a part of<br />
the treated sludge is returned to the aerator to maintain the sludge density. The system consists of:<br />
1 Collection tank<br />
2 Oilsump<br />
3 Equalisation Tank<br />
4 Recycle Sump<br />
5 High Rate Bio-filter<br />
6 Aeration Tank<br />
7 Clarifier Tank<br />
8 Sludge Drying Bed<br />
Capacity and its utilisation<br />
Following table summarises the production capacities for the year 2007-08:<br />
Sr.<br />
Installed Production<br />
Goods Produced<br />
Unit<br />
No.<br />
Capacity p.a. for the year*<br />
1. Polyester Staple Fibre/Chips M.Ts. 38,500 31,301<br />
2. Amorphous Grade M.Ts. 58,000 6,036<br />
3. Solid State Polymer M.Ts. 57,000 17,080<br />
4. PET Preforms M.Ts. 20,000 14,196<br />
Following table summarises the production capacities for the year 2006-07:<br />
Sr.<br />
Installed Production<br />
Goods Produced<br />
Unit<br />
No.<br />
Capacity p.a. for the year*<br />
1. Polyester Staple Fibre/Chips M.Ts. 38,500 31,296<br />
2. Amorphous Grade M.Ts. 58,000 6,103<br />
3. Solid State Polymer M.Ts. 57,000 25,311<br />
4. PET Preforms M.Ts. 20,000 12,307<br />
5. Ciba Products M.Ts. -- 273<br />
Following table summarises the production capacities for the year 2005-06:<br />
Sr.<br />
No.<br />
Goods Produced<br />
Unit<br />
Installed<br />
Capacity p.a.<br />
Production<br />
for the year*<br />
36
1. Polyester Staple Fibre/Chips M.Ts. 38,500 31,353<br />
2. Amorphous Grade M.Ts. 58,000 3,411<br />
3. Solid State Polymer M.Ts. 57,000 27,433<br />
4. PET Preforms M.Ts. 20,000 9,812<br />
5. Ciba Products M.Ts. -- 178<br />
Following table summarises the production capacities for the year 2004-05:<br />
Sr.<br />
Installed Production<br />
Goods Produced<br />
Unit<br />
No.<br />
Capacity p.a. for the year*<br />
1. Polyester Staple Fibre/Chips M.Ts. 38,500 35,243<br />
2. Amorphous Grade M.Ts. 58,000 3,005<br />
3. Solid State Polymer M.Ts. 57,000 17,087<br />
4. PET Preforms M.Ts. 20,000 13,016<br />
5. Custom Synthetics M.Ts. -- 1<br />
6. Ciba Products M.Ts. -- 226<br />
Following table summarises the production capacities for the year 2003-04:<br />
Sr.<br />
Installed Production<br />
Goods Produced<br />
Unit<br />
No.<br />
Capacity p.a. for the year*<br />
1. Polyester Staple Fibre/Chips M.Ts. 38,500 29,975<br />
2. Amorphous Grade M.Ts. 44,000 694<br />
3. Solid State Polymer M.Ts. 57,000 28,530<br />
4. PET Preforms M.Ts. 20,000 10,143<br />
* Production column indicates finished goods for sale but excludes production for conversion/internal<br />
consumption, damages, wastages and samples.<br />
Business Strategy<br />
Our strategy is to consolidate and enhance our market position as a producer of Specialty Fibres, Speciality<br />
Polymers and Speciality Preforms. We aim to achieve our strategic objective by implementing the following<br />
strategies:<br />
1. Continuous research and development in new speciality products to maintain a diverse product mix<br />
2. Increase in revenues by utilising our established business relationships<br />
3. Focus on speciality products realizing better margins<br />
4. Strengthening our competitive edge by patenting newly developed products<br />
5. Positioning ourselves amongst the top global brands by manufacturing diverse range of polyesters like<br />
PBT, PTT, PBN, PTN, PEN etc.<br />
We have been continuously developing new products to meet customised needs of our customers. With more<br />
than three decades of experience in Polyesters supported by our established business relationships with our<br />
customers, we believe that we are well placed to secure a significant share of Specialty Resin markets on the<br />
strength of our customised product development.<br />
Product Portfolio<br />
Polyester Fibres<br />
We produce a wide range of Polyester Fibres. We are a supplier of variety of specialty polyester fibres due to<br />
our flexible batch product lines, which enable us to make small volume fibres required by customers. We are a<br />
known producer of specialty coloured fibres in India. We also manufacture and market Polyester Tow, Tops and<br />
Low Pill Fibres. We have recently developed several other specialty fibres such as V-Flex High Shrink, Flame<br />
retardant moisture management and special effects fibres.<br />
37
Polymers<br />
Futura Polymers is 100% Export Oriented Unit (EOU). Depending upon the export market, part of the<br />
production of resin is sold in the local market or used, for captive consumption in preforms or fibres. The<br />
products cover the entire range of Polyesters namely, PET, PEN, PTT, PBT, PTN, PBN .<br />
PET Preforms<br />
PET Preforms are used by beverage/water bottlers for blowing into bottle of different sizes for filling<br />
juices/carbonated beverage/water as the case may be. The division has mould capacity to supply different sizes<br />
ranging from 17 grams to 54 grams to meet specific requirements of our customers. We have recently<br />
developed speciality performs for small Carbonated Soft Drinks, beer and containers for pasteurized products<br />
Our product wise sales for the last five years has been as under:<br />
Rs. in lacs.<br />
Product 2003-04 2004-05 2005-06 2006-07 2007-08<br />
Resin 13,503.28 12,414.43 20,997.11 23,780.16 15,235.26<br />
Preform 8,425.50 10,843.28 7,617.24 8,022.95 8,641.21<br />
Fibre 21,181.60 26,839.49 22,433.09 22,486.94 20,911.66<br />
Total 43,110.38 50,097.20 51,047.44 54,290.05 44,788.13<br />
Export Obligations<br />
As on May 31, 2008 we have export obligations for an amount of Rs. 200.21 lacs as mentioned below:<br />
Particulars Export Obligation (Rs. in lacs)<br />
Advance License 200.21<br />
Marketing and Marketing Strategy (Domestic and exports)<br />
1 Polyester Fibres<br />
Textile mills manufacturing blended polyester and worsted fabrics are our main customers. The major<br />
producers of PSF in India are Reliance Industries Ltd, Indo–Rama Synthetics (India) Limited, and<br />
Bombay Dyeing India Limited who have large capacities of Fibre and Filament Yarn. Their main<br />
product is semi-dull white fibre in the predominantly commodities segment.<br />
We are focussed on specialty and coloured fibres, Tow, Tops, Low Pill and new specialities, High<br />
Shrink, V-Flex, Flame Retardant and Moister Management and Special effects fibre. Our fibre sales are<br />
predominantly to domestic textile mills. We also cater to export markets in Europe, Middle East, USA<br />
and South East Asian countries. Our products and prices are internationally competitive which vary<br />
according to market conditions.<br />
We lay emphasis on development of new products. We have developed more than three hundred shades<br />
of colours in fibres. Recently, we have launched specialities such High Shrink Fibres, V-Flex Fibres,<br />
Flame Retardant Fibres, and Moisture Management Fibres.<br />
2 Polymers<br />
Futura Polymers is a 100% Export Oriented Unit. The PET Resin and allied products are primarily<br />
exported to various countries. There is currently an anti-dumping duty (ADD) against imports of PET<br />
Resin from India into the European Union to mitigate which we have executed a price undertaking with<br />
the European Commission, which facilitates the exports of Speciality Resin. We have completed a<br />
R&D initiative to launch a wide range of Specialty Resins such as Special Hot Fill Resin for fruit juice<br />
application, Special Wave-PET Resin for dual ovenable trays, Special Jar PET Resin as Poly Carbonate<br />
substitute for five gallon water jars, Beer PET Resin for tunnel pasteurisable Beer with C02,O2 barrier,<br />
Easy Dyeable Resin/V-Flex Resin for textile applications, Green PET Resin with 20% recycled<br />
content, Heavy metal free Resin and Resin for pasteurisable juice containers. Our Company has also<br />
diversified into production of entire range of polyesters such as PEN, PTT, PBT, PTN, PBN and Co-<br />
Polyesters.<br />
38
3 PET Preforms<br />
PET Preforms are sold predominantly in the domestic market to multinational beverage/water<br />
marketing companies. Our Company exports about 100 to 200 tons per month to various countries. The<br />
export market is growing rapidly and our Company hopes to increase its share of exports in the coming<br />
years. Our Company has installed a stretch blow-moulding machine, which is used to blow the bottles<br />
from the newly developed specialty resin for filling juices, beer and pharma products. Our Company is<br />
diversifying into Specialty Preforms for Hotfill / Beer / Liquor / Pharmaceutical segments by using<br />
specialty resins developed in-house.<br />
Competition<br />
i. Polyester Fibres<br />
Three major producers of PSF in India are Reliance Industries Limited, Indo Rama Synthetics (India)<br />
Limited, and Bombay Dyeing India Limited. They have large capacities with main product range as<br />
semi-dull white fibre and black fibre. Our Company is looking to consolidate its position in the niche<br />
segment of specialty and coloured fibres, tow, tops, low pill, etc. Our Company also exports fibres to<br />
several countries with focus on customised colour fibre business with over three hundred shades and<br />
have recently launched a range of speciality fibres such as High Shrink, V-Flex, Flame Retardant,<br />
Moisture Management and Special effects fibres. With continuous R&D and focus on speciality<br />
segment we believe that we can adequately withstand the competition in the segment.<br />
ii. Polymers<br />
The polymer products are mainly exported and there is limited sale in the domestic market except<br />
captive consumption for preforms. Reliance Industries Limited and South Asian Petrochem Limited are<br />
the major producers of PET resin in India. Large-scale producers in USA, China, Korea and Taiwan<br />
offer stiff competition in the world market. There is currently anti-dumping duty against import from<br />
India of PET resin in European Union countries. There are further large capacities being created, which<br />
would result in competition getting more intense.<br />
iii. PET Preforms<br />
There are many medium and small sized manufacturers of preforms in the domestic market. We are<br />
diversifying into specialty Preforms for small Carbonated Soft Drink, hot fill juices, tunnel<br />
pasteurisable containers, beer and pharmaceutical segments using specialty polymers to effectively<br />
handle competition.<br />
INTELLECTUAL PROPERTY<br />
Patents<br />
Details of the patents received by our Company are as follows:<br />
Patent<br />
Number<br />
US 7,199,210<br />
B2<br />
US 7,297,721<br />
B2<br />
EP 1 535 944<br />
B1<br />
Date of<br />
application<br />
October 19,<br />
2004<br />
June 17, 2004<br />
November<br />
19, 2004<br />
EP 1640408 March 29,<br />
2006<br />
972/CHE/2003<br />
November<br />
28, 2003<br />
Description Issued by & Date Duration<br />
Process patent for preparation<br />
of PE T Polyester using Non-<br />
Antimony Catalysts<br />
Process patent for Controlled<br />
Polymerization of a Mixed<br />
Polymer<br />
Process patent for Preparation<br />
of Fast Reheat Bottle Grade<br />
PET Resin<br />
Product patent for the invention<br />
of Oxygen Scavenging<br />
Composition<br />
Process patent for preparation<br />
of Fast Reheat Bottle Grade<br />
PET Resin<br />
The patent was issued by the<br />
Director of United States, Patent and<br />
Trademark Office, dated April 03,<br />
2007<br />
The patent was issued by the<br />
Director of United States, Patent and<br />
Trademark Office, dated November<br />
20, 2007<br />
The patent was issued by the<br />
President of the European Patent<br />
Office, dated October 18, 2006<br />
The patent was issued by the<br />
President of the European Patent<br />
Office<br />
The patent was issued by the<br />
Examiner of Patents and Designs,<br />
dated May 09, 2007<br />
20 years<br />
20 years<br />
20 years<br />
20 years<br />
20 years<br />
39
973/CHE/2003<br />
November<br />
28, 2003<br />
Product patent for Thermoplastic<br />
Crystalline PET<br />
The patent was issued by the<br />
Examiner of Patents and Designs,<br />
dated April 24, 2007<br />
20 years<br />
Details of the provisional and non provisional patent applications filed by our company<br />
1. Final Non Provisional Patent Applications filed by our Company are hereunder:<br />
Sr. Date of Filing Application Application with Nature of Description of Invention for which<br />
No.<br />
Number<br />
Patent the patent applied<br />
1. June 3, 2004 511/CHE/2004 Controller of Patents, Process 3-POT PROCESS. Process for<br />
India<br />
Patent producing Polyethylene Terephthalate<br />
(PET) with 3 reactors<br />
2. June 14, 2006 935/MUM/2006 Controller of Patents, Process FRH (Clear) TUNGSTEN OXIDE.<br />
India<br />
Patent Polyester Resin and Process for the<br />
preparation thereof<br />
June 22, 2006<br />
06253222.1<br />
President of European<br />
Patent Office<br />
Process<br />
Patent<br />
June 21, 2006<br />
11/471764<br />
Director of United States,<br />
Patents and Trademarks Process<br />
Office<br />
Patent<br />
Japan Patent Office,<br />
Tokyo<br />
June 22, 2006 2006-172286<br />
Process<br />
Patent<br />
3. June 22, 2006 981/MUM/2006 Controller of Patents, Product<br />
India<br />
Patent<br />
4. July 14, 2006<br />
July 14, 2006<br />
1119/MUM/2006<br />
EP20060253693<br />
Controller of Patents,<br />
India<br />
Product<br />
Patent<br />
President of the European<br />
Patent Office<br />
Product<br />
Patent<br />
HOT PET.<br />
Polyester Composition having<br />
improved heat stability<br />
CLEAR CPET. Crystalline<br />
Thermoplastic Polyester Resin<br />
Composition for clear transparent<br />
products and process thereof<br />
July 13, 2006<br />
11/485753<br />
Director of United States,<br />
Patents and Trademark Product<br />
Office<br />
Patent<br />
5. October 18,<br />
2005<br />
October 17,<br />
2005<br />
1297/MUM/2005<br />
11/252339<br />
Controller of Patents,<br />
India<br />
Product<br />
Patent<br />
Director of United States, Product<br />
Patents and Trademark Patent<br />
Office<br />
PET-PTN/PBN/PBT Alloy Blends.<br />
Gas Barrier PET Composition for<br />
Pasteurizable Monolayer Beer Bottle<br />
and Process thereof<br />
October 19,<br />
2005<br />
EP 20050256471<br />
President of the European<br />
Patent Office<br />
Product<br />
Patent<br />
40
6. December 22,<br />
2006<br />
November 21,<br />
2006<br />
December, 22<br />
2006<br />
December 20,<br />
2006<br />
December 26,<br />
2006<br />
2120/MUM/2006<br />
11/603266<br />
06256551.0<br />
2006-343231<br />
200610064189.6<br />
Controller of Patents,<br />
India<br />
Director of United States,<br />
Patents and Trademark Process<br />
Office<br />
Patent<br />
President of European<br />
Patent Office<br />
Process<br />
Patent<br />
Japan Patent Office,<br />
Tokyo<br />
Process<br />
Patent<br />
China Patent & Trade<br />
Mark Offfice, Shanghai<br />
Process<br />
Patent<br />
Method of Manufacturing PTN.<br />
Process<br />
Patent<br />
7. January 13, 56/MUM/2006 Controller of Patents, Product<br />
2007<br />
India<br />
Patent<br />
8. January 22, 124/MUM/2007 Controller of Patents, Product<br />
2007<br />
India<br />
Patent<br />
9. January 24, 11/657413 Director of United States, Product<br />
2007<br />
Patent and Trademark Patent<br />
Office<br />
Flame Retardant Polyester<br />
Composition.<br />
Naphthalate Based Barrier Resins.<br />
Naphthalate Based Resin Preforms and<br />
Monolayer & Multilayer Containers.<br />
January 29,<br />
2007<br />
10. February 19,<br />
2007<br />
158/MUM/2007<br />
316/MUM/2007<br />
Controller of Patents,<br />
India<br />
Product<br />
Patent<br />
Controller of Patents, Product<br />
India<br />
Patent<br />
Polyethylene Naphthalate (PEN).<br />
February 13, 11/706138 Director of United States,<br />
2007<br />
Patents and Trademark Product<br />
Office<br />
Patent<br />
11. April 28, 2007 676/MUM/2006 Controller of Patents, Product<br />
India<br />
Patent<br />
12. November 28, 1953/MUM/2007 Controller of Patents, Product<br />
2007<br />
India<br />
Patent<br />
Engineering Plastics.<br />
Polyester Staple Fibre/Filament Yarn<br />
for Textile Application.<br />
November 27,<br />
2007<br />
November 28,<br />
2007<br />
November 28,<br />
2007<br />
11/986908<br />
07254614.6<br />
200710306144.X<br />
Director of United States,<br />
Patents and Trademark Product<br />
Office<br />
Patent<br />
President of the European<br />
Patent Office<br />
China Patent & Trade<br />
Mark Offfice, Shanghai Product<br />
Patent<br />
Product<br />
Patent<br />
13. April 7, 2008 705/MUM/2008 Controller of Patents, Product<br />
India<br />
Patent<br />
Polyester Gas Barrier Resin.<br />
41
April 8, 2008<br />
12/080978<br />
Director of United States, Product<br />
Patents and Trademark Patent<br />
Office<br />
Polyester Gas Barrier Resin.<br />
April 8, 2008<br />
April 7, 2008<br />
10-2008-0032693<br />
2008-099731<br />
The Korean Intellectual<br />
Property Office, Govt.<br />
Complex, Daejeon, Korea<br />
Product<br />
Japan Patent Office,<br />
Tokyo<br />
Patent<br />
Polyester Gas Barrier Resin.<br />
Polyester Gas Barrier Resin.<br />
*<br />
*<br />
Product<br />
China Patent & Trade Patent<br />
Mark Office, Shanghai<br />
Polyester Gas Barrier Resin.<br />
April 8, 2008<br />
097112649<br />
The Intellectual Office, Product<br />
MOEA, Taipei City, Patent<br />
Taiwan R.O.C<br />
Polyester Gas Barrier Resin.<br />
April 09, 2008<br />
08251385.4<br />
European Patent Office<br />
Product<br />
Patent<br />
Polyester Gas Barrier Resin.<br />
* Application filed and details yet to be recieved<br />
Product<br />
Patent<br />
2. Preliminary Provisional Patent Applications filed by our Company are hereunder:<br />
Sr. No. Date of Filing Application<br />
Number<br />
Filed in Nature of<br />
Patent<br />
1. November 12, 2236/MUM/2007 Controller of Process<br />
2007<br />
Patents, India Patent<br />
2. November 22, 2304/MUM/2007 Controller of Product<br />
2007<br />
Patents, India Patent<br />
3. July 31, 2007 1457/MUM/2007 Controller of Product<br />
Patents, India Patent<br />
4. September 20,<br />
2007<br />
1837/MUM/2007 Controller of Product<br />
Patents, India Patent<br />
5. December 10, 2415/MUM/2007 Controller of Process<br />
2007<br />
Patents, India Patent<br />
6. March 04, 449/MUM/2008 Controller of Product<br />
2008<br />
Patents, India Patent<br />
Invention<br />
Polyesters (other than PET) using Tungsten<br />
compound as a cocatalyst<br />
Polyester resin for high shrinkage film<br />
PET and PEN/PTN copolyester resin for<br />
pasteurizable containers for juices, beverages<br />
etc.<br />
Polyester Resin composition of PET+IPA<br />
along with PEN and nucleating agents for<br />
Heat Seal films<br />
PCRPET with Granulated Flakes<br />
PTT-CoPET modified resin with superior<br />
properties<br />
Trademarks<br />
Our Company has registered 40 trademarks under various classes in India, whose registration is valid as on date.<br />
INSURANCE<br />
42
We have obtained insurance policies that cover standard industrial risks and workmens’ compensation for our<br />
principal places of business including our factory.at Manali, Chennai. We believe that we maintain insurance in<br />
accordance with customary industrial practices. However, the amount of our insurance coverage may be less<br />
than the replacement cost of all covered property and may not be sufficient to cover all financial losses that we<br />
may suffer should a risk materializes. Further, there are many events that could cause significant damages to our<br />
operations or expose us to third party liabilities, whether or not known to us, for which we may not be<br />
adequately insured. Further, all our insurance policies have exclusion clauses and do not cover us for certain<br />
risks and in certain circumstances. If we were to incur a significant liability for which we were not fully insured,<br />
it could have a material adverse effect on our results of operations and financial condition.<br />
PROPERTIES<br />
Property owned and leased by our company<br />
Particulars of owned property<br />
Sr. Details of Agreement<br />
No.<br />
1 Assignment Deed dated February 1, 1971<br />
. between Governor of Tamil Nadu (the<br />
“Assignor”) and Indian Organic Chemicals<br />
Limited [now Futura Polyesters Limited] (the<br />
“Assignee”)<br />
2 Assignment Deed dated May 26, 1976 between<br />
. Governor of Tamil Nadu (the “Assignor”) and<br />
Indian Organic Chemicals Limited [now Futura<br />
Polyesters Limited] (the “Assignee”)<br />
Particulars of the Property,<br />
Description & Area<br />
Land and Building in survey<br />
numbers 21/1 to 71/7, 75/1 to 75/3<br />
admeasuring 192 acres and 72 cents<br />
-<br />
Land and Building in survey<br />
numbers 169/5C 2A2, 169/5C 3B,<br />
169/5C 4A2 and 169/5C 5<br />
admeasuring 2 acres and 21 cents<br />
-<br />
Consideration<br />
Rupees three lacs<br />
and fifty thousand<br />
only<br />
Rupees ten thousand<br />
and four hundred<br />
only<br />
43
PARTICULARS OF LEASED PROPERTY<br />
Sr. Details of Agreement Property Details Consideration [Rs.] Tenure<br />
No.<br />
1. Lease Agreement dated Property admeasuring 3000 square feet Rupees sixteen<br />
December 9, 2005 situated at Survey number 214, thousand nine hundred<br />
between Mr. Shirish Wagson Wagons Warehouse of and eighty only per<br />
Shankarrao Wagholikar revenue village Phursungi within the month and interest free<br />
and Mr. Sudhir registration division and district Pune, security deposit of<br />
Shankarrao Wagholikar sub-division and taluka haveli within Rupees one lac and two<br />
(the “Licensors”) and the grampanchayat Phursungi<br />
thousand only<br />
Futura Polyesters<br />
Limited (the “Licensee”)<br />
2. Lease Agreement dated Godown number 1 compartment A Rupees thirty thousand<br />
March 29, 2005 between admeasuring 4760 square feet (442.5 five hundred and thirty<br />
M/s<br />
Central square meter) situated at Central three only per month<br />
Warehousing<br />
Warehouse, Kanjikode, Palakkad - and interest free<br />
Corporation (the 678 621<br />
advance of Rupees<br />
“Lessor”) and M/s<br />
thirty thousand five<br />
Futura Preforms [a<br />
hundred and thirty three<br />
division of Futura<br />
only<br />
Polyesters Limited] (the<br />
“Lessee”).<br />
33 months<br />
commencing<br />
from December<br />
1, 2005 to<br />
August 31, 2008<br />
1 Year<br />
commencing<br />
from April 12,<br />
2008<br />
* Renewed vide letter<br />
dated April 11, 2008.<br />
3. Lease Agreement dated<br />
March 25, 2006<br />
between M/s Central<br />
Warehousing<br />
Corporation (the<br />
“Lessor”) and Futura<br />
Polyesters Limited (the<br />
“Lessee”)<br />
4. Lease Agreement dated<br />
September 22, 2006<br />
between Mrs. G.<br />
Venkatamma (the<br />
“Lessor”) and Futura<br />
Polyesters Limited (the<br />
“Lessee”).<br />
Godown number H3 admeasuring 271<br />
square meter situated at Central<br />
Warehouse, APMC Yard,<br />
Yaswanthpur, Bangalore 560022<br />
Godown premises measuring 500<br />
square feet located at D, number 4-132<br />
(Shop numbers 2,3 and 4), GNT Road,<br />
Sullurpet – 524121, Nellore District,<br />
Andhra Pradesh.<br />
Rupees twenty one<br />
thousand six hundred<br />
eighty only per month<br />
and refundable interest<br />
free advance of Rupees<br />
sixty five thousand<br />
hundred and forty only<br />
Rupees three thousand<br />
only per month and<br />
refundable advance of<br />
Rupees thirty thousand<br />
only<br />
1 Year<br />
commencing<br />
from April 08<br />
onwardsS<br />
12 months<br />
commencing<br />
from October 1,<br />
2006 to<br />
September 30,<br />
2007.<br />
* Applied for renewal<br />
vide letter dated<br />
September 15, 2007<br />
5. Lease agreement dated<br />
September 14, 2005 by<br />
and between Central<br />
Warehousing<br />
Corporation (the<br />
“Lessor”) and Futura<br />
Polyester Limited (the<br />
Lesse”).<br />
Warehouse premises measuring 335 Sq<br />
mt located at Central Warehouse,<br />
panchpara, Satyen bose road, Dist-<br />
Howrah, 711103, West Bengal.<br />
Rs.75 per Sq mt per<br />
month exclusive of<br />
Service Tax Plus,<br />
education cess.<br />
12 months<br />
commencing<br />
from April 1,<br />
2008 to March<br />
31, 2009<br />
* Renewed vide letter<br />
dated March 31, 2008.<br />
6. Lease Agreement dated<br />
January 3, 2008,<br />
between Mrs. Jayashree<br />
Ananth (the “Lessor”)<br />
and Futura Polyesters<br />
Limited (the “Lessee”)<br />
7. Lease Agreement dated<br />
April 26, 2006 between<br />
Property admeasuring 3600 square feet<br />
situated at number 30, Rukmini Salai,<br />
Kalakshtra Colony, Chennai 600 090<br />
Apartment numbers 31, 32 and 33<br />
admeasuring 460.37 square meters<br />
Rupees seventy<br />
thousand only per<br />
month and interest free<br />
rental deposit Rupees<br />
seven lacs only<br />
Rupees two lacs twenty<br />
two thousand two<br />
32 months<br />
commencing<br />
from January<br />
20, 2008.<br />
33 months<br />
commencing<br />
44
Paragon Textile Mills<br />
Private Limited (the<br />
“Lessor”) and Futura<br />
Polyesters Limited (the<br />
“Lessee”)<br />
8. Lease Agreement dated<br />
January 15, 2007<br />
between NRB Bearings<br />
Limited (the “Licensor”)<br />
and Futura Polyesters<br />
Limited (the “Licensee”)<br />
equivalent to 4949 square feet of built<br />
up area on the 3 rd floor in building ‘B’<br />
of the Paragon Condominium bearing<br />
Cadastral Survey numbers 787 (part),<br />
3/787, 1/790, 791 and 1/792 of Lower<br />
Parel Division at Pandurang Budhkar<br />
Marg, Mumbai – 400 013.<br />
Flat number 4-A and 4-B together with<br />
a covered raking garage number 4 and<br />
open car parking space in the<br />
compound of the building known as<br />
“Shangri-la” situate on the plot of land<br />
bearing Cadastral Survey number<br />
8/723, Malabar and Cumbala Hill<br />
Division in the registration District and<br />
Sub-district of Mumbai City and<br />
municipal Ward number D at 27A,<br />
Carmichael Road, Mumbai 400 026<br />
hundred per month and<br />
fifty onl and a security<br />
deposit of Rupees ten<br />
lacs only<br />
Rupees five lacs only<br />
per month and interest<br />
free refundable security<br />
deposit of and Rs.<br />
15,00,000 Rupees<br />
fifteen lacs only<br />
from April 26,<br />
2006 to January<br />
25, 2009<br />
36 months from<br />
January 16,<br />
2007 to January<br />
15, 2010.<br />
45
FINANCIAL INDEBTEDNESS<br />
Secured<br />
Following are the details of the existing secured fund based and non fund based working capital facilities<br />
availed by our Company.<br />
(Rs. In lacs)<br />
Name of the<br />
Bank<br />
Amount<br />
Sanctioned<br />
Nature<br />
Facility<br />
Canara Bank 1800.00 Fund based/<br />
non fund based<br />
working capital<br />
facilites<br />
State Bank of<br />
India,<br />
Mumbai<br />
of<br />
3975.00 Fund based/<br />
non fund based<br />
working capital<br />
facilities<br />
Bank of India 4248.00 Fund based/<br />
non fund based<br />
working capital<br />
facilities<br />
Union Bank<br />
of India<br />
1332.00 Fund based/<br />
non fund based<br />
working capital<br />
facilities<br />
UCO Bank 1775.00 Fund based/<br />
non fund based<br />
working capital<br />
facilities<br />
Indian Bank 1485.00 Fund based/<br />
non fund based<br />
working capital<br />
facilities.<br />
State Bank of<br />
Hyderabad<br />
1450.00 Fund based/<br />
non fund based<br />
working capital<br />
facilities.<br />
Utilisation of Fund Based Facilities<br />
as on March 31, 2008<br />
Vide Sanction Letter June 11, 2007, a<br />
fund based working capital facility of<br />
Rs. 300 lacs was offered to our<br />
Company. However, the facility was<br />
not availed and therefore, the<br />
utilisation is Nil.<br />
Utilisation of<br />
Non- Fund Based<br />
Facilities as on<br />
March 31, 2008<br />
1,742.00<br />
1,539.36 1,813.33<br />
1,104.52 1,713.89<br />
313.19 431.62<br />
632.95 1,126.00<br />
152.10 549.00<br />
198.60 1,229.00<br />
Following are the details of the existing secured term loan facilities availed by our Company:<br />
(Rs. In lacs)<br />
Name of the Bank Amount Sanctioned Balance Outstanding As on March 31, 2008<br />
Canara Bank 1250.00 1,117.50<br />
Axis Bank Limited 2000.00 1,250.00<br />
Yes Bank Limited 2000.00 2,000.00<br />
<strong>IDBI</strong> Bank Limited 6000.00 3,204.00<br />
In respect of various agreements entered into by our Company with our lenders as mentioned above, we are<br />
bound by certain restrictive covenants. Pursuant to these covenants, we require written consent from our lenders<br />
before making / effecting the following changes:<br />
1 Change(s) in capital structure;<br />
46
2 Implementation of any scheme of expansion / diversification / renovation / capital expenditure;<br />
3 Formulation of any scheme of amalgamation or merger or reconstruction;<br />
4 Investment by way of share capital in or lend or advance funds to or place deposit with any other concern;<br />
5 Entering into borrowing or non-borrowing arrangements either on secured or unsecured basis with any<br />
other bank, financial institutions, company, firm or otherwise or accepting deposits in excess of the limits<br />
laid down by Reserve Bank of India;<br />
6 Undertaking guarantee obligations on behalf of any other borrower /organization;<br />
7 Declaring dividends for any year out of profits relating to that year after meeting all the financial<br />
commitments to the bank and making all due and necessary provisions;<br />
8 Making any drastic change in the management set up;<br />
9 Approaching the capital market for mobilising additional resources either in the form of debts or equity;<br />
10 Repaying monies brought in by the promoters, partners, directors, shareholders, their relatives and friends<br />
in the business of our company by way of deposits, loans, share application money, etc;<br />
11 Withdrawing monies brought in by principal shareholders / directors / depositors<br />
12 Creating any charge, lien or encumbrance over our undertaking or any part thereof in favour of any other<br />
financial institution, bank, firm or persons;<br />
13 Selling or disposing off or creating security or encumbrances on the assets charged to the bank in favour of<br />
any other bank, financial institution, company, firm, individual;<br />
In aforesaid to the aforesaid and other applicable terms, we have received the following No Objection<br />
Certificates (NOCs) from our lenders for this Issue:<br />
Sr. No. Name of the Lender Date of the NOC<br />
1. State Bank of India May 16, 2008<br />
2. Union Bank of India June 7, 2008<br />
3. State Bank of Hyderabad May 30, 2008<br />
4. Indian Bank May 16, 2008<br />
5. Bank of India June 10, 2008<br />
6. UCO Bank June 12, 2008<br />
7. Yes Bank Limited June 15, 2008<br />
8. Axis bank Limited June 11, 2008<br />
9. HDFC Limited June 10, 2008<br />
10 Canara Bank June 17, 2008<br />
We have applied for the following NOC from our lenders for this Issue:<br />
Sr. No. Name of the Lender Date of the Application<br />
1. <strong>IDBI</strong> Bank Limited June 9, 2008<br />
47
Unsecured/Inter-Corporate Deposits<br />
Following are the details of the unsecured debts/loans availed by our Company as on March 31 2008<br />
Type of Debt/Loan<br />
Balance as on March 31, 2008 (Rs.<br />
In lacs)<br />
Fixed Deposits from Public, Shareholders & Employees 477.06<br />
Inter Corporate Deposits 2388.00<br />
Deposits from Directors & former Directors (including the interest accrued<br />
1462.29<br />
and due thereon)<br />
Total 4327.35<br />
Vehicle Loans<br />
Our Company has further availed vehicle loans, secured by lien on vehicles purchased under hire purchase<br />
agreement. As at March 31, 2008, the aggregate outstanding on the said loans is Rs. 2,124,855.74<br />
48
KEY INDUSTRY REGULATIONS<br />
Our Company is engaged in the business of manufacturing Polyester Stable Fibre, Polyethylene Terepthalate<br />
Resins and Polyethylene Terepthalate Preforms. Our business is subject to central and state legislation, which<br />
regulates substantive and procedural aspects of manufacturing and exporting Fibre, Preforms and Polymer. The<br />
following is an overview of the important laws and regulations which are relevant for our business as a<br />
manufacturing and an export oriented industry<br />
I. Regulations govering business<br />
1. The Factories Act, 1948<br />
The Factories Act, 1948 (“Factories Act”) defines a factory to cover any premises which employs ten (10) or<br />
more workers and in which the manufacturing process is carried on with the aid of power and any premises<br />
where there are at least twenty (20) workers even though there is no electricity aided manufacturing process<br />
being carried on. The Factories Act which is a social legislation provides that an occupier of a factory i.e. the<br />
person who has ultimate control over the affairs of the factory and in case of a company, any of the directors,<br />
must ensure the health, safety, welfare, working hours, leave and other benefits for workers employed in<br />
factories. It was enacted primarily with the object of protecting workers from industrial and occupational<br />
hazards. Under this statute, an approval must be granted prior to the setting up of the factory and a license must<br />
be granted post the setting up of the same, by the Chief Inspector of Factories. In case of contravention of any<br />
provision of the Factories Act or rules framed there under, the occupier and the manager of a factory may be<br />
punished with the imprisonment for a term of up to two (2) years or with a fine of up to Rs. 100,000 or with<br />
both, and in case of a contravention continuing after conviction, with a fine of up to one thousand rupees per day<br />
of the contravention<br />
2. Shops and Establishments Acts<br />
Our Company is governed by various Shops and Establishment Acts as applicable in the states where it has<br />
offices, factories and sales depots. These Acts regulate the conditions of work and employment in shops and<br />
commercial establishments and generally prescribe obligations in respect of inter alia registration, opening and<br />
closing hours, daily and weekly working hours, holidays, leave, health and safety measures and wages for<br />
overtime work. The following acts are applicable to our offices, factories and sales depots:<br />
1. West Bengal Shops and Commercial Establishment Act, 1963<br />
2. Bombay Shops and Establishments Act, 1948<br />
3. Andhra Pradesh Shops and Establishments Act, 1988<br />
4. Kerala Shops and Establishment Act, 1960<br />
For details of our Company’s registration under the applicable Shops and Establishment Acts, please refer to the<br />
chapter tiltled “Government/Statutory Approvals” beginning on page 199 of the Draft Letter of Offer.<br />
3. The Electricity Act, 2003<br />
The Electricity Act, 2003 (hereinafter referred to as the “Act”) was enacted with effect from June 10, 2003<br />
repealing and replacing all the three Acts i.e. Indian Electricity Act, 1910, Electricity (Supply) Act, 1948 and<br />
Electricity Regulatory Commissions Act, 1998. The Act seeks to provide for demarcation of the roles of<br />
generation, transmission and distribution to provide for individual accountability of each. Some of the major<br />
provisions of the Act include inter alia the following:<br />
1. De-Licenses generation, makes captive-generation freely permissible;<br />
2. Provides open access for transmission, distribution and trading;<br />
3. Specifies technical standards, grid standards and safety requirements; and<br />
4. Introduces power trading as a distinct activity from power generation, transmission and distribution.<br />
As regards captive power generation, Section 7 of the Act provides that a generating company may establish,<br />
operate and maintain a generating station without obtaining a license under this Act if it complies with<br />
prescribed technical standards. Section 9(1) of the Act allows any person to construct, maintain or operate a<br />
captive generation plant and dedicated transmission lines, subject to the condition that supply of electricity from<br />
the captive generating plant through the grid shall be regulated in the same manner as the generating station of a<br />
generating company. Section 9(2) of the Act further states that every person who has constructed a captive<br />
generating plant and maintains and operates such plant shall have the right to open access for the purposes of<br />
carrying electricity from captive generating plant to the destination of his use, subject to availability of adequate<br />
transmission facility.<br />
49
4. The Indian Boilers Act, 1923<br />
The Indian Boilers Act, 1923 and the rules made thereunder are meant to regulate and ensure proper design,<br />
manufacture, operation and maintenance of boilers, in order to prevent safety hazards. This legislation requires<br />
that any boiler in use, in India, must be certified or registered, and that no boiler may function without the same.<br />
5. The Indian Explosives Act, 1884<br />
The purpose of the statute is to regulate the manufacture, possession, use, sale, transport and importation of<br />
explosives. The Central Government has the power to make rules with respect to regulation or prohibition, the<br />
manufacture, possession, use and sale of explosives. The statute requires that any person who intends to engage<br />
in any of the above mentioned activities with regard to explosives must apply for a license under the Indian<br />
Explosives Act,<br />
II. Environment related regulations<br />
6. The Water (Prevention and Control of Pollution) Act, 1974<br />
The Water ( Prevention and Control of Pollution) Act, 1974 (“Water Act”) prohibits the use of any stream or<br />
well for disposal of polluting matter, in violation of standards set down by the State Pollution Control Board<br />
(“SPCB”). This statute provides that prior permission from the relevant SPCB is required for the setting up of<br />
any industry, which is likely to discharge effluents.<br />
The functions of the Central Board include coordination of activities of the State Boards, collecting data relating<br />
to water pollution and the measures for the prevention and control of water pollution and prescription of<br />
standards for streams or wells. The State Pollution Control Boards are responsible for the planning for<br />
programmes for prevention and control of pollution of streams and wells, collecting and disseminating<br />
information relating to water pollution and its prevention and control; inspection of sewage or trade effluents,<br />
works and plants for their treatment and to review the specification and data relating to plants set up for<br />
treatment and purification of water; laying down or annulling the effluent standards fro trade effluents to be<br />
discharged. This legislation debars any person from establishing any industry, operation or process or any<br />
treatment and disposal system, which is likely to discharge trade effluent into a stream, well or sewer without<br />
taking prior consent of the State Pollution Control Board.<br />
7. The Air (Prevention and Control of Pollution) Act, 1981<br />
The Air (Prevention and Control of Pollution) Act, 1981, aims for the prevention, control and abatement of air<br />
pollution. It is mandated under this Act that no person can, without the previous consent of the State Board,<br />
establish or operate any industrial plant in an air pollution control area.<br />
This statute seeks to prevent and abate the level of air pollution and grants certain powers to the SPCB to ensure<br />
the same. Under the provisions of this legislation, every facility has to obtain a consent order from the relevant<br />
SPCB in order to carry on its industrial operations. The SPCB is required to grant consent within four months of<br />
receipt of the application. The consent may contain conditions relating to specifications of pollution control<br />
equipments to be installed.<br />
8. The Environment (Protection) Act, 1986<br />
The Environment (Protection) Act, 1986 and the rules made thereunder provides for ambient standards in<br />
respect of noise for different categories of areas (residential, commercial, and industrial) and silence zones have<br />
been notified. Noise limits have been prescribed for automobiles, domestic appliances and construction<br />
equipment at the manufacturing stage. The Noise Pollution (Regulation and Control) Rules 2000 (as amended in<br />
2002) provides that the owner of any diesel generator set with upto 1000 KVA requires an acoustic chamber and<br />
must have a conformance certificate.<br />
The Environment Act has been enacted for the protection and improvement of the environment. The Act<br />
empowers the central government to take measures to protect and improve the environment such as by laying<br />
down the standards for emission or discharge of pollutants, providing for restrictions regarding areas where<br />
industries may operate and so on. The Central Government may make rules for regulating environmental<br />
pollution.<br />
50
9. Hazardous Wastes (Management and Handling) Rules, 1989<br />
The Hazardous Wastes (Management and Handling) Rules, 1989 fix the responsibility of the occupier and the<br />
operator of the facility that treats hazardous wastes to properly collect, treat, store or dispose the hazardous<br />
wastes without adverse effects on the environment. It must also be ensured that the persons working on the site<br />
are given adequate training and equipment for performing their tasks.<br />
III. Fiscal regulations<br />
10. Service Tax<br />
Chapter V of the Finance Act 1994 (as amended), and Chapter V-A of the Finance Act 2003 requires that where<br />
provision of certain listed services, whole taxable services exceeds Rs. 400,000, a service tax with respect to the<br />
same must be paid. Every person who is liable to pay service tax must register himself for the same.<br />
11. Central Excise<br />
Excise duty imposes a liability on a manufacturer to pay excise duty on production or manufacture of goods in<br />
India. The Central Excise Act, 1944 is the principal legislation in this respect, which provides for the levy and<br />
collection of excise and also prescribes procedures for clearances from factory once the goods have been<br />
manufactured etc. Additionally, the Central Excise Tariff Act, 1985 prescribes the rates of excise duties for<br />
various goods.<br />
12. Value Added Tax Act<br />
VAT is a system of multi-point levy on each of the entities in the supply chain with the facility of set-off input<br />
tax whereby tax is paid at the stage of purchase of goods by a trader and on purchase of raw materials by a<br />
manufacturer. Only the value addition in the hands of each of the entities is subject to tax. VAT is based on the<br />
value addition of goods, and the related VAT liability of the dealer is calculated by deducting input tax credit for<br />
tax collected on the sales during a particular period. VAT, is essentially a consumption tax applicable to all<br />
commercial activities involving the production and distribution of goods and the provisions of services, and<br />
each State that has introduced VAT has its own VAT Act, under which, persons liable to pay VAT must register<br />
themselves and obtain a registration number from the Excise Tax Officer of that respective State.<br />
13. Central Sales Tax Act<br />
The tax on sale of movable assets within India is governed by the provisions of the Central Sales Tax (CST)<br />
Act, or the state legislations depending upon the movement of goods pursuant to such sale. If the goods move<br />
inter-state pursuant to a sale arrangement, then the taxability of such sale is determined by the CST Act. On the<br />
other hand, when the taxability of an arrangement of sale of movable assets which does not contemplate<br />
movement of goods outside the state where the sale is taking place is determined as per the local sales tax/VAT<br />
legislations in place within the states<br />
14. The Income Tax Act, 1961<br />
The Income Tax Act provides that any company deducting tax must apply to the assessing officer for the<br />
allotment of a tax deduction account number. Furthermore, the legislation requires every tax payer and certain<br />
other persons to apply to the assessing officer for a permanent account number.<br />
IV. Employment related regulations<br />
15. The Employee’s State Insurance Act, 1948<br />
The Employees State Insurance Act, 1948 is applicable to all factories and to such establishments as the Central<br />
Government may notify, unless a specific exemption has been granted. The employers in such factories and<br />
establishments are required to pay contributions to the Employees State Insurance Corporation, in respect of<br />
each employee at the rate prescribed by the Central Government. Companies which are controlled by the<br />
Government are exempt from the aforesaid requirement if the employees are receiving benefits which are<br />
similar or superior to the benefits prescribed under the Employees State Insurance Act, 1948.<br />
16. Employee’s Provident Funds and Miscellaneous Provisions Act, 1952<br />
51
Under the Employee’s Provident Funds and Miscellaneous Provisions Act, 1952, compulsory provident fund,<br />
family pension fund and deposit linked insurance is payable to employees in factories and other establishments<br />
for their benefit. The legislation provides that an establishment employing more than twenty (20) persons, either<br />
directly or indirectly, in any capacity whatsoever, is either required to constitute its own provident fund or<br />
subscribe to the statutory employee’s provident fund. The employer of such establishment is required to make a<br />
monthly contribution to the provident fund equivalent to the amount of the employee’s contribution to the<br />
provident fund, subject to a minimum contribution of 12% of the basic wages, dearness allowance and retaining<br />
allowance, if any, payable to each employee.<br />
17. Payment of Bonus Act, 1965<br />
An employee in a factory who has worked for at least thirty (30) days in a year is eligible to be paid bonus.<br />
‘Allocable surplus’ is defined as 67% of the available surplus in the financial year, before making arrangements<br />
for the payment of dividend out of profit. The minimum bonus fixed by the statute must be paid irrespective of<br />
the existence of any allocable surplus. If allocable surplus exceeds minimum bonus payable, then the employer<br />
must pay bonus proportionate to the salary or wage earned during that period, subject to a maximum of twenty<br />
per cent of such salary or wage. Contravention of the provision of the legislation is punishable by imprisonment<br />
up to six (6) months or a fine up to one thousand rupees or both.<br />
18. Payment of Gratuity Act, 1972<br />
Under the Payment of Gratuity Act, 1972 an employee in a factory is deemed to be in ‘continuous service’ for a<br />
period notwithstanding that his service has been interrupted during that period by sickness, accident, leave,<br />
absence without leave, lay-off, strike, lock out or cessation of work not due to the fault of the employee, or the<br />
employee has worked at least two hundred and forty (240) days in a period of twelve (12) months or one<br />
hundred and twenty (120) days in a period of six (6) months immediately preceding the date of reckoning. An<br />
employee, who after having completed at least five (5) continuous years of service in an establishment resigns,<br />
retires, or is disabled due to an accident or disease, is eligible to receive gratuity. To meet this liability,<br />
employers of all establishments, to which the legislation applies, are liable to contribute towards gratuity.<br />
V. Labour related regulations<br />
19. The Trade Unions Act, 1926<br />
The Trade Unions Act, 1926 was enacted to provide for the registration of trade unions and for defining the law<br />
in relation to trade unions. This legislation sets out the procedure for registration of trade unions and also<br />
provides the rights and liabilities of registered trade unions. The statute also provides immunity to registered<br />
trade unions from civil suits in certain cases. This legislation is of great significance for those organizations<br />
whose workers have organized and formed registered trade unions.<br />
20. The Contract Labour (Regulation and Abolition) Act, 1970<br />
The Contract Labour (Regulation and Abolition) Act, 1970 applies to those establishments where twenty (20) or<br />
more workmen are employed or were employed on any day of the preceding twelve (12) months as contract<br />
labour and to every contractor or sub-contractor who employs or who employed twenty (20) or more workmen<br />
on any day of the preceding twelve (12) months, provided they were not employed in the core activities as<br />
notified. The legislation seeks to regulate the working conditions of the contract labour and to provide for its<br />
abolition in certain cases. This statute provides that any employer seeking to employ contract labour must<br />
register his establishment to the appropriate authority, which is the Joint Labour Commissioner of that particular<br />
state<br />
VI. Regulations related to intellutual property rights<br />
21. Trade Marks Act, 1999<br />
The Indian law on trademarks is enshrined in the Trade Marks Act, 1999. The Act was introduced in the place<br />
of Trade and Merchandise Marks Act, 1958, which laid down the laws pertaining to the registrations and<br />
protection of trademarks in India. For the purpose of the Trademarks Act, 1999, “existing registered trademark”<br />
means a trademark registered under the Trade and Merchandise Marks Act, 1958. Under the existing legislation,<br />
a trademark is a mark used in relation to goods so as to indicate a connection in the course of trade between the<br />
goods and some person having the right as proprietor to use the mark. A ‘mark’ may consist of a word or<br />
invented word, signature, device, letter, numeral, brand, heading, label, name written in a particular style and so<br />
forth. The trademark once applied for, is advertised in the trademarks journal, oppositions, if any are invited and<br />
52
after satisfactory adjudications of the same, a certificate of registration is issued. The right to use the mark can<br />
be exercised either by the registered proprietor or a registered user. The present term of registration of a<br />
trademark is ten years, which may be renewed for similar periods on payment of prescribed renewal fee.<br />
22. Patents Act, 1970<br />
The laws on patents in India are governed by the Patents Act, 1999. Under the existing legislation, two types of<br />
patents are granted, i.e. Product Patent and Process Patent. An application is made for the grant of patent is<br />
made under Section 24 (2) is made before the Controller of Patents. The application contains in detail the<br />
specifications of the invention or the innovation, as the case may be. The applicant must make out a prima facie<br />
case for the grant of patent. The same is investigated by the Controller. If upon the investigation of the evidence,<br />
a prima facie case for the grant of patent is made out, then the applicant receives the patent under the Act, or<br />
else the application is rejected. The patent is granted by the Controller of patents. Once granted, the<br />
infringement is a punishable offence under Sections 58 and 59 of the Act. The patent is granted for a period of<br />
twenty years.<br />
VII. Export promotion capital goods scheme (“EPCG”)<br />
This scheme framed under the Foreign Trade Policy facilitates import of capital goods at a concessional rate of<br />
duty coupled with an appropriate export obligation to be fulfilled by the person availing the benefits under the<br />
scheme within a designated period of time.<br />
VIII.Other regulations<br />
In addition to the above, our Company is required to comply with the provisions of the Companies Act, 1956,<br />
the Foreign Exchange Management Act, 1999, various sales tax related legislations and other applicable statutes<br />
53
HISTORY AND OTHER CORPORATE INFORMATION<br />
History<br />
Our Company was incorporated in the year 1960 under the name of Indian Organic Chemicals Limited. The<br />
name of our Company was changed to Futura Polyesters Limited with effect from November 05, 2002.<br />
Our Company was promoted by the Late Mr. Bhupatirai Maganlal Ghia, a noted industrialist. The Late Mr.<br />
Bhupati Maganlal Ghia and the Late Mr. Dharamdas Sitaldas Dalal were our Company’s Managing Director<br />
and Joint Managing Director from January 01, 1970 until August, 1990 and December 31, 1987, respectively.<br />
After the demise of Mr. Bhupatirai Maganlal Ghia and retirement of Mr. Dharamdas Sitaldas Dalal, Mr. Shyam<br />
Bhupatirai Ghia (son of late Mr. Bhupatirai Maganlal Ghia) and Mr. Mukund Dharamdas Dalal (son of late Mr.<br />
Dharamdas Sitaldas Dalal) are considered as Promoters of our Company. Presently, our Company is managed<br />
by Mr. Shyam Bhupatirai Ghia in the capacity as Chairman & Managing Director and by Mr. Mukund<br />
Dharamdas Dalal in the capacity as Joint Managing Director.<br />
Consequent upon the nationalisation of various banks the erstwhile Corporation Bank Limited had received<br />
compensation of Rs. 180 lacs from the Government of India. Corporation Bank Limited was not under the<br />
control or ownership of the promoters of our Company. At that time our Company needed funds for the<br />
Polyester projects expansion at Chennai. Hence, after negotiation it was agreed that the erstwhile Corporation<br />
Bank Limited would be amalgamated with our Company so that our Company could utilize the compensation<br />
amount received by Corporation Bank Limited for its expansion project and that the shareholders of Corporation<br />
Bank would receive shares in our Company. Accordingly, the amalgamation scheme was prepared and approved<br />
by the respective shareholders of both the companies and the High Court of Karnataka and Mumbai. Upon<br />
amalgamation, our Company issued Equity Shares of Rs. 10/- each credited as fully paid, one convertible<br />
debenture at a face value of Rs. 125/- credited as fully paid and one convertible secured debenture of face value<br />
of Rs. 150/- credited as fully paid against every five ordinary shares of Rs. 50/- each fully paid held by such<br />
members in Corporation Bank Limited.<br />
In the year 1986, our Company formed a separate software division called Sonata Software Division which was<br />
engaged in development, consultancy and marketing of software products. After eight years of its existence and<br />
in view of the opportunities available for software business, the management decided that this activity needed<br />
separate focus and management techniques different from manufacturing activities. The business needed<br />
recruitment of large number of personnel to be trained in software companies, which did not match with the<br />
existing pay structure and prerequisites given by our Company. It was, therefore, decided to spin off this activity<br />
to a separate company formed for this purpose, namely, Sonata Software Limited. Hence, by means of an<br />
agreement in the year 1994 the division was transferred to Sonata Software Limited.<br />
In the face of competition from large manufacturers, a number of polyester manufacturing companies had either<br />
to close down their operations or allow acquisition by other large companies. One of the problems of the<br />
Polyester industry is the high cost of raw materials namely, PTA, MEG, etc. Companies which had integrated<br />
facilities for manufacturing both, the raw materials as well as polyester and fabrics, had a competitive<br />
advantage. In order to overcome this challenge our Company decided to experiment in recycling of polyester<br />
fibre waste and PET bottle scrap into polyester feed stock so as to develop substitute for the high cost raw<br />
material. This needed separate research and development and manufacturing facility distinct from Company’s<br />
operations. Hence, our Company formed a subsidiary called Futura Industries Limited (FIL) for the purpose.<br />
Initially, a factory was located at Tiruvellore, near Chennai, where the bottle washing/crushing/flaking facilities<br />
were designed and developed, based on years of research and development. FIL had also patented the<br />
technology for recycling (developed as above). FIL was carrying out the operation on job work basis for<br />
sometime and the facilities were later shifted from Tiruvellore to the main factory location at Manali, Chennai to<br />
avoid transportation cost. Having perfected the technology for recycling it was considered unnecessary to have<br />
separate establishment for this activity since it involved additional expenditure in terms of administrative costs,<br />
maintenance of separate books of accounts, compliance with various formalities under the laws governing direct<br />
and indirect taxes. Hence in the year 2001 FIL was amalgamated with our Company after getting the required<br />
approvals from the High Courts of Chennai and Bombay.<br />
In the year 1992-93, our Company was approached by PepsiCo international, U.S.A., (PepsiCo) to explore the<br />
possibilities of forming a Joint Venture (JV), to manufacture PET Resin for use by PepsiCo to make bottles for<br />
its packaged beverage/water businesses in U.S.A. After negotiations, a separate JV was formed, namely, Futura<br />
Polymers Limited, with PepsiCo through its investment company. Transmere Inc. Mauritius. In this Futura<br />
Polymers Limited, Transmere Inc. held 70% of the equity and our Company held the remaining 30% of the<br />
Equity Share capital. As per the JV arrangement, PepsiCo through its bottling companies purchased the PET<br />
Resin manufactured by the Joint Venture. In the year 1998, PepsiCo took corporate decision to concentrate only<br />
on its core business, namely, beverages and food products and decided to exit the Joint Venture and sold its<br />
entire stake of 100% in Transmere Inc. to our Company. This resulted, in our Company holding the entire 100%<br />
54
(70% through Transmere and 30% directly) of the Equity Shares of Futura Polymers Limited. In order to avoid<br />
additional expenditure in terms of administrative cost, maintaining separate books of accounts, need for<br />
compliance with various laws including direct and indirect laws etc. it was decided to merge Transmere Inc.,<br />
and the JV Company with our Company. Transmere was amalgamated in 1999 and JV Company was<br />
amalgamated in 2002.<br />
With the launching of petro-based chemicals in 1990s and liberalization of molasses usage for potable alcohol,<br />
our industrial alcohol-based facility at Khopoli lost its competitive edge. Hence, the Chemical division at<br />
Khopoli became unviable and had to be gradually closed down over a period of time. Thereafter, the<br />
infrastructure and facilities available at Khopoli were utilized for new lines of business consisting of contract<br />
chemicals, customs synthesis, contract R&D and other related areas based on specialized scientific skills<br />
available in this country. Since these new activities required special focus, as distinct from the core business of<br />
our Company, namely, manufacture of Polyester Staple fibre, PET Resin and preforms, it was decided to hive<br />
off the Khopoli division to another Company. Hence in the year 2001, our Company incorporated a new<br />
company under the name Innovassynth Technologies (India) Limited as its wholly owned subsidiary. In the year<br />
2004 our Company transferred its entire Chemicals division at Khopoli to Innovassynth Technologies (India)<br />
Limited for a consideration of Rs. 50 crores consisting of Rs. 25 crores of fully paid up Equity Shares and Rs.<br />
25 crores as debt, which has since been repaid. Thereafter, Innovassynth Technologies (India) Limited raised<br />
further capital to meet its expansion requirements. Consequently, the shareholding of our Company in<br />
Innovassynth Technologies (India) Limited stood at 42.5% of the paid up share capital of Innovassynth<br />
Technologies (India) Limited.<br />
Our Company decided to transfer its entitre shareholding of 2,38,50,070 equity shares in Innovassynth<br />
Technologies (India) Limited to a new company namely Innovassynth Investments Limited which was<br />
incorporated on February 15, 2008. It was decided to carry out this transfer through a Scheme of Arrangement<br />
and accordingly, our Company filed in the High Court of Bombay a Scheme of Arrangement under Sections 391<br />
to 394 of the Companies Act, 1956. Pursuant to the Scheme of Arrangement our Company divested its entire<br />
shareholding in Innovassynth Technologies (India) Limited to, Innovassynth Investments Limited, and pursuant<br />
to the said Scheme of Arrangement, shareholders of our Company shall be entitled to receive five equity shares<br />
in Innovassynth Investments Limited for every eleven equity shares held on the record date fixed for the<br />
purposes of determining entitlement of shareholders under the said Scheme. The said Scheme was sanctioned by<br />
the High Court of Bombay on July 04, 2008. The Scheme of Arrangement becomes effective when a copy of the<br />
order of the High Court is filed with with the RoC. Our Company has filed the copy of the order of the High<br />
Court with RoC July 15, 2008, .<br />
In the year 2004, our Company raised additional equity share capital through rights issue at par. The funds<br />
raised by the Rights Issue were fully utilized as working capital.<br />
In the year 2005, our Company incorporated Futura Polyesters Inc. U.S.A as a Subsidiary. Since there were no<br />
operations and no transactions by our company, it was dissolved in the year 2006.<br />
In 2006-2007, our Company was granted its first patent by the President of the European Patent Office for a<br />
period of twenty years.<br />
Main Objects of our Company<br />
Main objects of our Company as set out in the Memorandum of Association inter alia are:<br />
1. To carry on business as manufacturers of and dealers in all kinds and forms of polymers, plastics, plastic<br />
polymerized products, intermediaries, performs and end products including containers, bottles, tubes,<br />
wrapping, packaging and insulating materials of all kinds and descriptions and all other blow moulded, the<br />
injection moulded, polymerized, formed or extruded goods, articles and products.<br />
2. To carry on the business of manufacturing, buying, selling, exchanging, converting, altering, importing,<br />
exporting, processing, twisting or otherwise handling or dealing in rayon yarn (also known as Continental<br />
rayon or artificial silk yarn) including synthetic fibres, whatsoever for textile use, staple fibres yarn (also<br />
known as spun rayons) and such other fibre, fibres or fibrous materials or allied products, by products or<br />
substances or substitutes for all or any of them, or yarn or yarns for textile or other use as may be<br />
practicable or deemed expedient.<br />
55
The main objects clause and the objects incidental or ancillary to the main objects of the Memorandum of<br />
Association of our Company enable us to undertake our existing activities and the activities for which the<br />
funds are being raised through this Issue.<br />
Key Milestones/Significant Events in our Company’s history<br />
Date of<br />
Remarks<br />
change<br />
1960 Incorporation of our Company<br />
1963 Beginning of alcohol based manufacturing at Khopoli<br />
1971 Public Issue made by our Company of Rs. 260.72 lacs, consisting of 2,60,725 Equity Shares of Rs. 100/-<br />
each at par<br />
1972 Beginning of Polyester Staple Fibre manufacturing at Chennai<br />
1978 Commercialization of Polyester Waste Recycling process<br />
1982 Amalgamation of Corporation Bank Limited with our Company<br />
1986 Beginning of Sonata Software Division<br />
1986 Incorporation of Futura Industries Limited, as a subsidiary<br />
1986 Expansion of Polyester Fibre reaches 38,500 TPA<br />
1988 Launch of Specialty Fibres and Dope Dyed Fibres<br />
1988 Rights Issue made by our Company of Rs. 891.30 lacs, consisting of 59,42,425 Equity Shares of Rs. 10/-<br />
each at a premium of Rs. 5/- per Share<br />
1993 Incorporation of Futura Polymers Limited, pursuant to a Joint Venture between PepsiCo Investment<br />
subsidiary (Transmere Inc.) and our Company to manufacture PET Resin<br />
1993 Rights Issue made by our Company of Rs. 2766.61 lacs, consisting of 92,22,040 Equity Shares of Rs.<br />
10/- each at a premium of Rs. 20/- per share<br />
1994 Sonata Software division was transferred to Sonata Software Limited<br />
1998 Termination of the Joint Venture by PepsiCo; Futura Polymers became a Subsidiary of our Company<br />
1999 Introduction of Contract Manufacture, Custom Synthesis and Contract Research and Development at<br />
Khopoli<br />
1999 Transmere Inc. was amalgamated with our Company.<br />
2000 Expansion of Preform reaches 6000 TPA<br />
2001 Amalgamation of Futura Industries Limited with our Company<br />
2001 Preform expansion reaches 12000 TPA<br />
2001 Launching of Innovassynth Technologies India Limited as a wholly owned Subsidiary<br />
2002 Amalgamation of Futura Polymers Limited with our Company<br />
2002 Expansion of Preform reaches 20000 TPA<br />
2002 Closure of Chemicals business at Khopoli<br />
2002 Change of name of our Company from Indian Organic Chemicals Limited to Futura Polyesters Limited<br />
2002 Expansion of PET Resin reaches 57000 TPA from 28000 TPA<br />
2003 Revaluation of Plant and Machinery at Manali and Khopoli for the reflection of their fair value<br />
2004 Transfer of Chemicals business at Khopoli to Innovassynth Technologies India Limited<br />
2004 Introduction of new speciality product range for packaging certain products<br />
2004 Rights Issue made by our Company of Rs. 1487.87 lacs, consisting of 1,48,78,729 Equity Shares of Rs.<br />
10/- each at par<br />
2005 Launching of Futura Polyesters Inc. U.S.A as a subsidiary<br />
2006 Dissolution of Futura Polyesters Inc. U.S.A<br />
2008 Revaluation of land at Chennai for reflection of its fair value<br />
2008 Transfer of our holding of 2,38,50,070 equity shares in Innovassynth Technologies (India) Limited to<br />
Innovassynth Investments Limited as per the Scheme of Arrangement<br />
Awards, Achievements and Certifications:<br />
Year<br />
February 2005<br />
October 18, 2006<br />
October 18, 2006<br />
Particulars<br />
Recycling Award for pioneering the production of PET and reclamation and chemical<br />
recycling of post consumer PET for food grade applications by Global Plastics<br />
Environmental Conference<br />
Grant of Process Patent by the President of the European Patent Office for the process<br />
of fast heat reheat bottle grade polyethleneterephthlate resin. The duration of the patent<br />
is twenty years.<br />
Grant of Process Patent by the Examiner of Patents and Designs for the process of fast<br />
heat reheat bottle grade polyethleneterephthlate resin. The duration of the patent is<br />
56
twenty years.<br />
April 03, 2007 Grant of Process Patent by the Director of United States of America, Patents and<br />
Trademark Office for Antimony free polyester resin. The duration of the patent is<br />
twenty years.<br />
April 24, 2007 Grant of Process Patent by the Director of United States of America, Patents and<br />
Trademark Office for controlled polymerization of a mixed polymer. The duration of<br />
the patent is twenty years.<br />
November 20, 2007 Grant of Product Patent by the Examiner of Patents and Designs for Thermo-plastic<br />
Crystalline PET. The duration of the Patent is for twenty years.<br />
Changes in the Memorandum of Association of our Company since Incorporation<br />
Date of change<br />
Events<br />
September 01. 1969 Increase in the Authorized Share <strong>Capital</strong> from Rs. 400 lacs to Rs. 500 lacs, divided into<br />
4,00,000 equity shares of Rs. 100/- each and 100,000 Cumulative Redeemable Preference<br />
shares of Rs. 100/- each.<br />
September 08, 1976 Increase in the Authorized Share <strong>Capital</strong> from Rs. 500 lacs to Rs. 750 lacs, divided into<br />
6,50,000 equity shares of Rs. 100/- each and 1,00,000 Cumulative Redeemable Preference<br />
shares of Rs. 100/- each.<br />
September 08, 1976 Amendment of the Object Clause by inserting a new clause to carry on activities in lending<br />
money, giving guarantees and acquire shares and securities<br />
September 30, 1978 Amendment of the Object Clause by inserting a new clause to undertake, promote or sponsor<br />
any activity for the promotion and growth of national economy and for discharging social and<br />
moral responsibilities<br />
Amendment of the Object Clause by inserting a new clause to undertake, promote or sponsor<br />
any program on rural health or development<br />
August 22, 1979 Increase in the Authorised Share <strong>Capital</strong> to Rs. 1100 lacs, divided into 10,00,000 Equity<br />
Shares of Rs. 100/- each and 1,00,000 Cumulative Redeemable Preference shares of Rs. 100/-<br />
each.<br />
September 23, 1981 Sub-division of face value of Equity Shares from Rs. 100/- to Rs. 10/- and the Authorised<br />
Share <strong>Capital</strong> changed to 1,00,00,000 Equity Shares of Rs. 100/- each and 1,00,000<br />
Cumulative Redeemable Preference Shares each aggregating to Rs. 1100 lacs<br />
September 07, 1983 Amendment of the Object Clause by inserting a new clause to manufacture and deal in food<br />
and edible products<br />
August 08, 1985 Increase in the Authorised Share <strong>Capital</strong> to Rs. 2500 lacs, divided into 2,40,00,000 Equity<br />
Shares of Rs. 10/- each and 1,00,000 Cumulative Redeemable Preference shares of Rs. 100/-<br />
August 14, 1985<br />
September 08, 1986<br />
each.<br />
Amendment of the Object Clause by carry on the business of electronic and electrical goods<br />
Amendment of the Object Clause by inserting a new clause to acquire and hold shares in<br />
another Company<br />
Amendment of the Object Clause by inserting a new clause to carry on business of assisting<br />
any Company by issuing/subscribing/guaranteeing subscription of shares and securities.<br />
Amendment of the Object Clause by inserting a new clause to promote and form new<br />
companies<br />
Amendment to the Object Clause by inserting a new clause to invest and deal with monies of<br />
our Company<br />
Amendment to the Object Clause by inserting a new clause to carry on experimenting and<br />
testing new process or patent or invention<br />
September 16, 1992 Increase in the Authorized Share <strong>Capital</strong> from Rs. 2500 lacs to Rs. 5000 lacs, divided into<br />
49,000,000 Equity Shares of Rs. 10/- each and 100,000 Cumulative Redeemable Preference<br />
shares of Rs. 100/- each.<br />
July 25, 2002 Inserting a new clause to carry on business and dealers in all kinds and forms of polymers.<br />
November 05, 2002 Change in the name of our Company from Indian Organic Chemicals Limited to Futura<br />
Polyesters Limited<br />
April 08, 2005 Increase in Authorized Share <strong>Capital</strong> from Rs. 5000 lacs to Rs. 5500 lacs, divided into<br />
54,000,000 Equity Shares of Rs. 10/- each and 100,000 Cumulative Redeemable Preference<br />
shares of Rs. 100/- each<br />
July 15, 2008<br />
Increase in authorised share capital from Rs. 5500 Lacs to Rs. 8000 Lacs divided into<br />
7,90,00,000 Equity Shares of Rs. 10/- each and 100,000 Cumulative Redeemable Preference<br />
shares of Rs. 100/- each<br />
57
Changes in Registered Office of our Company<br />
Date Registered Address Reasons<br />
1960 Industrial Assurance Building, Incorporated<br />
5 th Floor, Churchgate<br />
Bombay 1 (Rental)<br />
1961-1962 28, Apollo Street Fort<br />
Bombay 1<br />
(Rental)<br />
1975-1976 New Excelsior Building<br />
6 th Floor, Wallace Street, Fort<br />
Bombay 400001<br />
(Ownership)<br />
January 25,<br />
1994<br />
October 19,<br />
1994<br />
October 06,<br />
1997<br />
October 06,<br />
2003<br />
Our Subsidiary<br />
Bhupati Chambers<br />
4 th Floor, 13, Mathew Road,<br />
Bombay 400004<br />
(Rental)<br />
Chemtex House,<br />
2 nd Floor,<br />
Main Street, Sector 12,<br />
Hiranandani Gardens, Powai<br />
Bombay 400076 (Rental)<br />
Bhupati Chambers,<br />
3 rd Floor, 13, Mathew Road<br />
Bombay 400004 (Rental)<br />
Paragon Condominium,<br />
3 rd Floor, Pandurang Budhkar<br />
Marg<br />
Mumbai 400013<br />
Innovassynth Investments Limited<br />
Brief History<br />
Due to spaces constraint, it was decided to move to a bigger premises<br />
belonging to Promoter Group in Apollo Street<br />
Due to rearrangement in Promoter’s Group, our Company moved to<br />
its own premises in New Excelsior building<br />
Our Company decided to sell its premises and moved to a rental<br />
premises<br />
As owner if the rented premises required the premises for own use,<br />
our Company shifted to a bigger premises in Hirananadani Complex<br />
Since owner, sold the premises our Company shifted it office to<br />
Bhupati Chambers<br />
Owner sold the premises. Our Company shifted its office to (rented<br />
premises) present location.<br />
Innovassynth Investments Limited was incorporated on February 15, 2008 under the Companies Act, 1956, with<br />
its registered office situated at 3 rd Floor, Paragon Condominium, P.B. Marg, Worli, Mumbai - 400013. The<br />
shares of Innovassynth Investments Limited are not listed on any of the stock exchanges in India.The certificate<br />
of commencement of business of Innovassynth Investment Limited was issued on March 04, 2008.<br />
Nature of Activities<br />
This company has been incorporated to carry on business of an investment company and / or holding company,<br />
to buy, sell, deal, hold, invest, disinvest, exchange and surrender stocks, shares, securities, scrips, derivatives,<br />
debt instruments, bonds, debentures, policies, book debts and claims and commercial papers, government or<br />
commercial security or any other financial investment instruments of any company, banks whether government<br />
or non-government, public or private or any local authority whether in India or abroad, and to promote,<br />
subsidize and assist companies and syndicates in order to promote the business of company.<br />
Board of Directors<br />
The Board of Directors of Innovassynth Investments Limited as on March 31, 2008 consists of<br />
Name<br />
Mr. Shyam Bhupatirai Ghia<br />
Dr. B. Sahu<br />
Mr. S. Ramachandran<br />
Position<br />
Chairma<br />
n and<br />
Director<br />
Director<br />
Director<br />
Shareholding Pattern<br />
58
The shareholding pattern of this company as on March 31, 2008 is as under<br />
Category No. of Shares held Percentage of Holding<br />
Futura Polyesters Limited 49, 940 99.88<br />
Mr. Shyam Bhupatirai Ghia 10 0.02<br />
Dr. Bhabatosh Sahu 10 0.02<br />
Mr. Sankaran Ramachandran 10 0.02<br />
Mr. S.B. Chatterjee 10 0.02<br />
Mr. A.R. Gadkari 10 0.02<br />
Mr. A.G. Shenoy 10 0.02<br />
Total 50,000 100<br />
Financial Performance<br />
(Rs in lacs)<br />
Particulars<br />
For the year ending<br />
on March 31, 2008<br />
Total Revenue<br />
NIL<br />
Profit After Tax<br />
NIL<br />
Equity Share <strong>Capital</strong> 5.00<br />
Reserves (exclusion revaluation<br />
NIL<br />
reserves)<br />
Net Worth 2.29<br />
EPS per share of Rs. 10<br />
NIL<br />
NAV per share of Rs. 10 4.58<br />
Note: Pursuant to the implementation of the Scheme of Arrangement shareholders of our Company would<br />
receive five equity shares in Innovassynth Investments Limited for every eleven Equity Shares held in our<br />
Company on the record date fixed for the purposes of determining entitlement of shareholders under the said<br />
Scheme. Upon the aforesaid allotment becoming effective, Innovassynth Investments Limited would cease to be<br />
a subsidiary of our Company. However, it is a subsidiary of our Company as on date of the Draft Letter of<br />
Offer.<br />
Shareholders Agreements<br />
There are no subsisting shareholders agreements among our shareholders in relation to our Company, of which<br />
our Company is aware.<br />
Scheme of Arrangement<br />
Our Company decided to transfer its entitre shareholding of 2,38,50,070 equity shares in Innovassynth<br />
Technologies (India) Limited to a new company, namely, Innovassynth Investments Limited which was<br />
incorporated on February 15, 2008. It was decided to carry out this transfer through a Scheme of Arrangement<br />
and accordingly, our Company filed in the High Court of Bombay a Scheme of Arrangement under Sections 391<br />
to 394 of the Companies Act, 1956 whereby our Company divested its entire shareholding in Innovassynth<br />
Technologies (India) Limited to, Innovassynth Investments Limited, and pursuant to the said Scheme of<br />
Arrangement, the shareholders of our Company would be entitled to receive five equity shares in Innovassynth<br />
Investments Limited for every eleven equity shares held on the record date fixed for the purposes of determining<br />
entitlement of shareholders under the said Scheme. The said Scheme was sanctioned by the High Court of<br />
Bombay on July 04, 2008.<br />
Increase in Authorised Share <strong>Capital</strong> pursuant to the Scheme of Arrangement<br />
On the Scheme of Arrangement becoming effective, the authorised share capital of Innovassynth Investments<br />
Limited shall be increased to Rs.25,00,00,000 (Rupees Twenty five crores only) divided into 2,50,00,000 equity<br />
shares of Rs.10/- each.<br />
Other Agreements<br />
Our Company has not entered into any other material contracts, not being a contract entered into in the ordinary<br />
course of business carried on by our Company or intended to be carried on by our Company, or a contract<br />
entered into more than two years before the date of the Draft Letter of Offer.<br />
59
Strategic Partners<br />
Our Company does not have any strategic partners.<br />
Financial Partners<br />
Our Company does not have any financial partners.<br />
60
OUR MANAGEMENT<br />
BOARD OF DIRECTORS<br />
As per our Articles of Association we cannot have less than five or more than fifteen directors. Currently, we<br />
have nine directors on our Board. Our Chairman and Managing Director, Mr. Shyam Bhupatirai Ghia and Joint<br />
Managing Director, Mr. Mukund Dharamdas Dalal manage our day to day operations under the supervision,<br />
direction and control of our Board of Directors. The constitution of our Board of Directors meets the<br />
requirements of corporate governance, as it comprises of five independent directors, which accounts for more<br />
than half of the strength of the Board.<br />
Details of our Directors are given below:<br />
Sr.<br />
No.<br />
Name, Father's name, Designation,<br />
Address, Occupation, Nationality,<br />
Tenure & DIN<br />
Age Date of<br />
Appointment as<br />
Director<br />
Other Directorships<br />
1. Mr. Shyam Bhupatirai Ghia<br />
S/o. Mr. Bhupatirai Maganlal Ghia<br />
Chairman and Managing Director<br />
Address:<br />
Ghia Mansion,<br />
18 Carmichael Road,<br />
Mumbai – 400 026<br />
Occupation: Industrialist<br />
Nationality: Indian<br />
Tenure as Director: Not subject to<br />
retirement by rotation<br />
DIN: 00005264<br />
2. Mr. Mukund Dharamdas Dalal<br />
S/o. Mr. Dharamdas Sitaldas Dalal<br />
Joint Managing Director<br />
Address:<br />
Sital Sagar,<br />
64, Walkeshwar Road,<br />
Mumbai – 400 006<br />
Occupation: Company Executive<br />
Nationality: Indian<br />
Tenure as Director: Not subject to<br />
retirement by rotation<br />
DIN: 00005275<br />
3. Mr. Viren Rajan Raheja<br />
S/o. Mr. Rajan Raheja<br />
Director<br />
Address:<br />
“Rahejas”, Corner of Main Avenue<br />
and V.P. Road, Santacruz West,<br />
Mumbai – 400 049<br />
61 October 18, 1973 Public Companies:<br />
1. Sonata Software Limited.<br />
2. Alkyl Amines Limited.<br />
3. A.V.T Natural Products<br />
Limited.<br />
4. Innovassynth Technologies<br />
(India) Limited<br />
5. Innovassynth Investments<br />
Limited<br />
Private Companies:<br />
1. Brahmasonic Sound<br />
Production Private Limited.<br />
2. Chika Private Limited.<br />
3. Chika Overseas Private<br />
Limited<br />
4. Kika Investments & Finance<br />
Private Limited<br />
5. Viraj Investments Private<br />
Limited<br />
51 January 1, 1988 Public Companies:<br />
1. Sonata Software Limited<br />
Private Companies:<br />
1. Actis Biologics Private<br />
Limited<br />
23 April 15, 2008 Public Companies<br />
1. Asianet Satellite<br />
Communications Limited.<br />
2. Sonata Software Limited.<br />
3. Supreme Petrochem Limited.<br />
4. Innovassynth Technologies<br />
(India) Limited<br />
61
Occupation: Industrialist<br />
Nationality: Indian<br />
Tenure: Additional Director – holds<br />
office till the date of next AGM<br />
DIN: 00037592<br />
Private Companies<br />
1. Abu Developers Private<br />
Limited<br />
2. Akalpitam Land Developers<br />
Private Limited<br />
3. Ala Mona Contractors &<br />
Developers Private Limited.<br />
4. Ameeta Grihnirman Private<br />
Limited.<br />
5. Ananya Construction Company<br />
Private Limited<br />
6. Arjun Housing Private Limited<br />
7. ARKO Dealers Private Limited<br />
8. ARKO Enterprises Private<br />
Limited<br />
9. Bellvne Constructions Private<br />
Limited<br />
10. Bellvne Contractors &<br />
Developers Private Limited<br />
11. Bestow Contractors &<br />
Developers Private Limited.<br />
12. Bay-Side Exports Private<br />
Limited<br />
13. Bay-Side Constructions Private<br />
Limited<br />
14. Bay-Side Contractors &<br />
Developers Private Limited<br />
15. Bloomingdale Investment and<br />
Finanace Private Limited<br />
16. Bloomingdale Trading<br />
Company Private Limited.<br />
17. Brindaban Agro Industries<br />
Private Limited<br />
18. Brindaban Land Development<br />
Private Limited.<br />
19. Beach Plaza Contractors &<br />
Developers Private Limited<br />
20. Chandramouli Finance and<br />
Estates Private Limited.<br />
21. Colonnade Contractors and<br />
Developers Private Limited<br />
22. Colonnade Housing Private<br />
Limited<br />
23. Crescent Property Developers<br />
Private Limited<br />
24. Coronet Investments Private<br />
Limited.<br />
25. Chevy Trading Private Limited.<br />
26. Excelsior Construction Private<br />
Limited<br />
27. Fortune Films Private Limited<br />
28. Globus Stores Private Limited.<br />
29. Gstaad Estates Private Limited.<br />
30. Gstaad Investment and Finance<br />
Private Limited.<br />
31. Gstaad Trading Company<br />
Private Limited.<br />
32. Hathway Cable & Datacom<br />
Private Limited<br />
33. Kaunteya Contractors<br />
&Developers Private Limited.<br />
34. Kaunteya Builders Private<br />
Limited.<br />
35. Kuntinandan Contractors and<br />
62
Developers Private Limited.<br />
36. Kuntiputra Properties Private<br />
Limited<br />
37. Kalpitam Premises Private<br />
Limited.<br />
38. Kanyakumari Contractors<br />
Developers Private Limited<br />
39. Lavina Contractors &<br />
Developers Private Limited<br />
40. Manali Investment & Finance<br />
Private Limited.<br />
41. Manali Builders Private<br />
Limited<br />
42. Manali Estate Private Limited<br />
43. Matsyagandha Estates. Private<br />
Limited<br />
44. Matsyagandha Investment. and<br />
Finance. Private Limited.<br />
45. Meenakshi Builders Private<br />
Limited.<br />
46. Outlook Publishing (India)<br />
Private Limited<br />
47. Panchali Builders Private<br />
Limited.<br />
48. Prerana Builders Private<br />
Limited.<br />
49. Peninsula Estates Private<br />
Limited.<br />
50. R.Raheja Property Private<br />
Limited<br />
51. R.Raheja Investments Private<br />
Limited<br />
52. R.B.R. Construction Private<br />
Limited<br />
53. R.B.R. Estates and Finance<br />
Private Limited.<br />
54. Rajan Estates and Finance<br />
Private Limited<br />
55. Raghukul Developers Private<br />
Limited.<br />
56. Sea Side Exports Private<br />
Limited<br />
57. Shiraz Realators Private<br />
Limited.<br />
58. Shoreline Constructions Private<br />
Limited<br />
59. Shoreline Exports Private<br />
Limited<br />
60. Spur Cable & Datacom Private<br />
Limited<br />
61. Sonal Properties Private<br />
Limited.<br />
62. Shalilni Construction Company<br />
Private Limited<br />
63. Shalini Developers Private<br />
Limited.<br />
64. Suchetan Construction<br />
Company Private Limited<br />
65. Trophy Investment and Finance<br />
Private Limited<br />
66. Vidur Construction Private<br />
Limited<br />
67. Varahagiri Investments and<br />
Finance Private Limited.<br />
63
4. Mr. Sharad Shreepad Marathe<br />
S/o. Shreepad Govind Marathe<br />
Director<br />
Address:<br />
Vinay, 9, Sahajeevan<br />
Co-operative Housing Society, Off.<br />
Ganeshkhind Road,<br />
Pune – 411 007<br />
Occupation: Retired from<br />
Government service<br />
Nationality: Indian<br />
Tenure: Subject to retirement by<br />
rotation<br />
DIN: 00016935<br />
5. Mr. Prathipati Abraham<br />
S/o. Mr. P.Sundaram<br />
Nominee Director<br />
Address:<br />
D-71, Nivedita Kunj,<br />
Sector 10, R. K. Puram,<br />
New Delhi - 110022<br />
Occupation: Retired IAS officer<br />
Nationality: Indian<br />
Tenure: Not subject to retirement by<br />
rotation.<br />
DIN: 00280426<br />
6. Mr. Vispi Rusi Patel<br />
S/o. Mr. Rusi Hormusgi Patel<br />
68. Villa-Capri Developers Private<br />
Limited<br />
69. Villa-Capri Estates Private<br />
Limited<br />
70. Whitsun Contractors and<br />
builders Private Limited.<br />
71. Windsor Realty Private Limited<br />
72. Wren Contractors &<br />
Developers Private Limited<br />
73. Zillion Contractors &<br />
Developers Private Limited<br />
74. Zircon consultants Private<br />
Limited<br />
85 August 20, 1986 Public Companies:<br />
1. Automotive Axles Limited<br />
2. Bharat Forge Limited<br />
3. Deepak Fertilizers & Petro<br />
Chemicals Corporation<br />
Limited<br />
4. Finolex Industries Limited<br />
5. Force Motors Limited<br />
6. Kinetic Motor Limited<br />
7. Kirloskar Brothers Limited<br />
8. Sandvik Asia Limited<br />
9. Sunrise Technologies Limited<br />
Private Companies:<br />
1. GDA Trustee & Consultancy<br />
Private Limited<br />
2. Life & General Associates<br />
Private Limited<br />
3. Tata Asset Management<br />
Private Limited<br />
4. Pan Gulf Group Limited St.<br />
Peters Port Guernsey, Channel<br />
Islands<br />
68 July 2, 2003 Public Companies:<br />
1. Maharashtra State Power<br />
Generation Company<br />
2. Uflex Industries Limited<br />
3. GVK Power and Infrastructure<br />
Company Limited<br />
4. PTC Limited<br />
5. JSW Energy Limited<br />
6. Vijay Electricals Limited<br />
7. Lanco Infratech Limited<br />
8. Nagarjuna Construction<br />
Company Limited<br />
9. PTC Financial Services<br />
Limited<br />
45 July 27, 2001 NIL<br />
Director<br />
Address:<br />
B-21, Acropolis,<br />
Little Gibbs Road,<br />
Malabar Hill,<br />
Mumbai – 400 006<br />
Occupation: Company executive<br />
64
Nationality: Indian<br />
Tenure: Balance tenure<br />
DIN: 00211464<br />
7. Mr. Shyam Sunder Sami<br />
S/o. Vidhyawath Swami<br />
Director<br />
68 July 31, 2002 Public Company<br />
Innovassynth Technologies (India)<br />
Limited<br />
Address:<br />
C-203, Golden Oak,<br />
High Street,<br />
Hiranandani Gardens, Powai,<br />
Mumbai – 400 076<br />
Occupation: Retired company<br />
executive<br />
Nationality: Indian<br />
Tenure: Balance tenure<br />
DIN : 00026470<br />
8. Mr. Nikhil Shyam Ghia<br />
S/o. Mr. Shyam Bhupatirai Ghia<br />
Director<br />
Address:<br />
Ghia Mansion,<br />
18, Carmichael Road<br />
Mumbai -400 026<br />
Occupation: Industrialist<br />
Nationality: Indian<br />
Tenure: Additional Director – holds<br />
office till the date of next AGM<br />
DIN: 00089258<br />
9. Mr. K. Ramasubramanian<br />
S/o. Mr. N. Kuppusubramanian<br />
Director<br />
Address:<br />
403, Patel New Building,<br />
Patel Estate, Jogeshwari (West),<br />
Mumbai – 400 012<br />
35 May 30, 2008 Private Companies:<br />
1. Chika Private Limited<br />
2. Chika Overseas Private<br />
Limited<br />
3. Meridion Overseas Private<br />
Limited<br />
4. Viraj Investments Private<br />
Limited<br />
5. Brahmasonic Sound Production<br />
Private Limited<br />
6. Kika Investments & Finance<br />
Private Limited<br />
7. Bhupati Investments & Finance<br />
Private Limited<br />
8. Kika Dyechem Exports Private<br />
Limited<br />
66 May 30, 2008 Public Company:<br />
1. Mirae Asset Trust Company<br />
Limited<br />
Private Company:<br />
1. PMC Medicals Private Limited<br />
Occupation: Retired RBI executive<br />
Nationality: Indian<br />
Tenure: Additional Director – holds<br />
office till the date of next AGM<br />
DIN: 1623890<br />
Note: None of the above mentioned Directors are on the RBI List of willful defaulters as on date.<br />
Brief Biography of Our Directors<br />
Mr. Shyam Bhupatirai Ghia, is 61 years old and is a resident of India. He holds a Bachelor’s Degree in<br />
Chemistry from the University of Mumbai and Master’s Degree in Business Administration from Bowling Green<br />
State University, Ohio, United States of America. Further, he has also undergone practical training in<br />
Administration and Commerce at Bayer’s offices in New York, United States of America and Leverkusen in<br />
Germany. Mr. Shyam Bhupatirai Ghia, has extensive experience spanning over thirty years, in industry. He joined<br />
our Company from March 01, 1972 as Director, Administration and was elevated to the Board as a Whole-time<br />
Director with effect from October 18, 1973. Subsequently, elevated to the position of Joint Managing Director<br />
with effect from January 01, 1988 and as Managing Director with effect from August 23, 1990<br />
65
Mr. Mukund Dharamdas Dalal, is 51 years old and is a resident of India. He holds a Bachelor’s Degree in<br />
Chemical Engineering from Salford University, United Kingdom and Master of Science Degree in Chemical<br />
Engineering from Massachusetts Institute of Technology (MIT), United States of America. Further, he has<br />
undergone extensive training in the production plants of Chemische Werke Huls, AG, West Germany and has also<br />
been associated with various research projects.. Mr. Mukund Dharamdas Dalal joined the services of our Company<br />
with effect from December 11, 1980, as Manager Projects and Planning. He was promoted to the position of<br />
General Manager, Futura Synthetics Division with effect from August 01, 1983 till December 31, 1987. With<br />
effect from January 01, 1988, he was elevated to the Board as a Whole-Time Director and was designated as<br />
Director-Technical. Thereafter, he was promoted to the position of a Joint Managing Director from April 01, 1992.<br />
Mr. Viren Rajan Raheja, is 23 years old and is a resident of India. He holds a Bachelor’s degree in Commerce<br />
from the University of Mumbai. He has cleared three levels of Chartered Financial Analysis and has pursued<br />
Master’s in Business Administration from London Business School.<br />
Mr. Sharad Shreepad Marathe, is 85 years old and is a resident of India. He has obtained his education from<br />
London School of Economics and Political Science. He was an Economist by profession and Administrator in the<br />
Central Government. He was a member of the Indian Economic Service since its inception and retired as Secretary<br />
to the Government of India, Ministry of Industry (Department of Industrial Development). He has chaired the<br />
Bureau of Industrial Costs and Prices, Government of India. He was an Alternate Executive Director for India on<br />
‘International Monetary Fund’ and has concurrently served the Ministry for Economics and Commercial Affairs,<br />
Embassy of India, Washington. He was also an Economic Advisor to the Government of India. He is well<br />
experienced in the fields of Finance and Industry. He was a Director on the Central Board of the Reserve Bank of<br />
India for ten years. He was a Director on the Industrial Development Bank of India and Chairman of the National<br />
Productivity Council, New Delhi. He was the first Chairman of <strong>IDBI</strong> Bank and also Chairman of SICOM. He was<br />
the Chairman/Member of several committees including Committee on Indirect Taxation, Fertilizers Price<br />
Committee and National Committee on Science and Technology. He is a visiting Professor at the Center for Policy<br />
Research, New Delhi and a Member of the Investment Advisory Board for Army Group Insurance.<br />
Mr. Prathipati Abraham, is 68 years old and is a resident of India. He holds a Master’s degree in Arts and<br />
Diploma in System Management. He is a retired officer of the India Administrative Service and has held a series<br />
of important responsible executive positions in the Centre as well as State level. He was the first Chairman of<br />
Maharashtra State Electricity Board. He was awarded the Unido fellowship to study promotion of industries with<br />
special emphasis on export-oriented industries in Europe. Besides, he has also penned a book on the Reforms in<br />
the Power Sector named ‘Focused on Distribution’.<br />
Mr. Vispi Rusi Patel, is 46 years old and is a resident of India. He holds a Master’s degree in Management<br />
Studies from the University of Bombay. He began his career with Hong Kong Bank. In 1993 he joined the Mohit<br />
Diamonds Group (a sightholder of the Diamond Trading Company, London) as the Chief Operating Officer. He<br />
was responsible for Mohit Group’s foray into the luxury watch and jewellery business by facilitating Piaget,<br />
Cheopard and Vacheron Constantin’s entry into India. Mr. Vispi Rusi Patel is currently a Group Director, Moet<br />
Hennessy Louis Vuitton (LVMH), India.<br />
Mr. Shyam Sunder Sami, is 67 years old and is a resident of India. He holds a Bachelor’s Degree in Arts from<br />
the University of Bombay. He is a retired senior executive of Wimco Limited and has a wide experience at a<br />
senior level in various companies like J.K. Helene Curtis Limited, Parle Products Limited, Geoffrey Manners<br />
Limited and Hindustan Unilever Limited, among others<br />
Mr. Nikhil Shyam Ghia, is 35 years old and is a resident of India. He holds a Bachelor’s Degree in Arts in<br />
Economics and Management from Ohio Wesleyan University, Delaware, Ohio in June 1997. He has also<br />
completed his Masters in Business Administration in General Business from Bryant College, Smithfield, Rhode<br />
Island, in May 1999. Further, he was inducted into Beta Gamma Sigma National Honor Society and Who’s Who<br />
in America.<br />
Mr. K. Ramasubramanian, is 66 years old and is a resident of India. He holds a Master’s Degree in Science<br />
from University of Kerala, a Post Graduate Diploma in Management and Diploma in Computer Science. He joined<br />
RBI in 1967 as a probationary officer and served in various capacities, and retired as General Manager - Foreign<br />
Exchange Department of RBI in 2002.<br />
BORROWING POWERS OF BOARD OF DIRECTORS<br />
Pursuant to an ordinary resolution passed at the Annual General Meeting of our Company held on September 6,<br />
1995, our Directors were authorised to borrow money(s) on behalf of our Company in excess of the paid up<br />
share capital and the free reserves of our Company from time to time, pursuant to the provisions of Section 293<br />
(1) (d) of the Companies Act, subject to an amount not exceeding Rs. 400 Crores.<br />
66
For further details of the provisions of our Articles of Association regarding borrowing powers, please refer to<br />
the section titled ‘Articles of Association of the Company’ beginning on page 244 of the Draft Letter of Offer.<br />
COMPENSATION OF DIRECTORS<br />
Non – Executive Directors<br />
Non-Executive Directors are paid sitting fees for attending meetings of the Board and of Committees of the Board.<br />
Details of the sitting fees/compensation paid to Directors for the year ended March 31, 2008 are as under:<br />
Names of the Directors Commission Sitting Fees Total (Rs.)<br />
Mr. Sharad Shreepad Marathe - 30,000 30,000<br />
Mr. Prathipati Abraham - 40,000 40,000<br />
Mr. Vispi Rusi Patel - 40,000 40,000<br />
Mr. Shyam Sunder Sami - 40,000 40,000<br />
TOTAL NIL 150,000 150,000<br />
Executive Directors<br />
Mr. Shyam Bhupatirai Ghia was re-appointed as Chairman and Managing Director of our Company for a period of<br />
five years from April 1, 2004 to March 31, 2009, and Mr. Mukund Dharamdas Dalal was re-appointed as the Joint<br />
Managing Director of our Company for a period of five years from April 1, 2004 to March 31, 2009, both at the<br />
AGM held on September 28, 2004.<br />
The salient terms of their appointment, as contained in the agreements entered into with each of them by our<br />
Company, are summarized hereinbelow:<br />
Name of Director Mr. Shyam Bhupatirai Ghia Mr. Mukund Dharamdas Dalal<br />
Remuneration<br />
Rs. 65,000/ per month as basic<br />
pay in the grade of 50,000-<br />
5,000-1,00,000 with liberty to<br />
the Board to grant additional<br />
increments in the scale as<br />
above<br />
Rs. 55,000/ per month as basic<br />
pay in the grade of 50,000-<br />
5,000-1,00,000 with liberty to<br />
the Board to grant additional<br />
increments in the scale as<br />
above<br />
And to each of them:<br />
i. Commission at the rate of 1% of the net profits of our Company computed in the manner laid down in<br />
Sections 349 and 350 of the Companies Act, 1956;<br />
ii. A city compensatory allowance of Rs. 1800 per month while the Managing Director/Joint Managing<br />
Director is based in Mumbai;<br />
iii. Fully furnished residential accommodation or in lieu of the said accommodation the Managing<br />
Director/Joint Managing Director be paid a house rent allowance at the rate of 50% of<br />
iv. the Managing Director’s monthly salary;<br />
v. Reimbursement of gas, electricity and water charges as also furnishings evaluated as provided for in the<br />
Income-tax Rules, 1962;<br />
vi. One motor car with driver for ourCompany’s business, all running operation and maintenance expenses<br />
therefore, to be borne and paid by our Company;<br />
vii. Benefit of our Company’s Provident Fund Scheme, and the Superannuation or Annuity Fund Scheme, for<br />
the time being in force together with the benefit of any retirement Fund or Scheme which our Company<br />
may introduce in future;<br />
viii. Gratuity in accordance with the rules of our Company for the time being in force;<br />
ix. Reimbursement of actual medical expenses incurred for self and family (i.e. wife, dependant children and<br />
dependant parents);<br />
x. Benefit of sick leave accordance with the rules of our Company for the time being in force;<br />
xi. 30 days privilege leave with full pay and allowances for each completed year of service, the said leave<br />
being accumulatable and encashable in accordance with the rules of our Company for the time being in<br />
force.;;<br />
xii. Benefit of 1 st class air/air-conditioned train, and/or such other mode of conveyance as may be opted while<br />
proceeding on privilege leave, together with hotel/board and lodging expenses incurred at actuals;<br />
xiii. Personal accident insurance cover at the cost of our Company provided the actual premium thereof does not<br />
exceed Rs. 4,000 per year;<br />
xiv. One telephone for our Company’s business at the Managing Director’s residence;<br />
67
xv. Fees of Clubs the Managing Director is or may become, a member of (subject to a maximum of two)<br />
together with the benefit of all expenses incurred there at in or onwards the business of our Company;<br />
The above remuneration is however subject to the ceiling of 5% of the net profits of our Company where our<br />
Company has only one managerial personnel and 10% of the net profits of our Company where our Company has<br />
more than managerial personnel for all such managerial personnel put together.<br />
No sitting fees shall be paid to our Managing Director and Joint Managing Director for attending any meetings of<br />
the Board or any Committee thereof.<br />
The agremements entered into by our Company with our Chairman and Managing Director dated and our Joint<br />
Managing Director, both dated March 31, 2004 has certain other salient terms in relation to their respective<br />
appointments. These include, among others, remuneration in case of absence/inadequacy of profits,<br />
confidentiality, non-compete, confidentiality, etc. these agreements are available for inspection as stated in the<br />
chapter titled “Material Contracts and Documents for Inspection” beginning on page 284 of the Draft Letter of<br />
Offer.<br />
SHAREHOLDING OF OUR DIRECTORS<br />
As per our Articles, our Directors are not required to hold any qualification Equity Shares in our Company. Save<br />
and except as below, our Directors do not hold any Equity Shares in our Company as on the date of filing of the<br />
Draft Letter of Offer.<br />
Sr. No. Name of the Directors No. of Equity Shares<br />
1. Mr. Shyam Bhupatirai Ghia 1,012<br />
2. Mr. Mukund Dharamdas Dalal 255,744<br />
3. Mr. Viren Rajan Raheja -<br />
4. Mr. Sharad Shreepad Marathe 723<br />
5. Mr. Prathipati Abraham -<br />
6. Mr. Vispi Rusi Patel 1,806<br />
7. Mr. Shyam Sunder Sami -<br />
8. Mr. Nikhil Shyam Ghia 70,623<br />
9. Mr. K. Ramasubramanian -<br />
None of our Directors or key managerial personnel are “relatives” within the meaning of Section 6 of Act,<br />
except as stated below:<br />
Name of the Director<br />
Mr. Nikhil Shyam Ghia<br />
Mr. Shyam Bhupatirai Ghia<br />
Relation<br />
Son of Mr. Shyam Bhupatirai Ghia<br />
Father of Mr. Nikhil Shyam Ghia<br />
INTEREST OF DIRECTORS<br />
None of our Directors or key managerial personnel have been appointed pursuant to any understanding or<br />
arrangement with major shareholders, customers, suppliers or others. However, Mr. Prathipati Abraham is a<br />
nominee Director of <strong>IDBI</strong> Bank Limited. All of our Directors may be deemed to be interested to the extent of<br />
fees payable to them for attending meetings of the Board and to the extent of remuneration payable to our<br />
Executive Directors for their services as executive directors of our Company and reimbursement of expenses<br />
payable to them under our Articles of Association.<br />
All our Directors may also be deemed to be interested to the extent of Equity Shares, if any, already held by<br />
them or their relatives or bodies corporate in which they have interest in our Company, or Equity Shares that<br />
may be subscribed for and allotted to them, out of the present Issue in terms of the Draft Letter of Offer and also<br />
to the extent of any dividend payable to them and other distributions in respect of the said Equity Shares.<br />
Except as stated above and transactions disclosed in the chapter titled “Related Party Transaction” on page 109<br />
of the Draft Letter of Offer, our Directors do not have any other interest in our business.<br />
We have not acquired any property from our Directors in the last two years.<br />
68
CHANGES IN OUR BOARD OF DIRECTORS DURING THE LAST THREE YEARS<br />
The following are the changes in our Board of Directors during the last three years:<br />
Name of our Director Date of Appointment Date of Cessation Reasons<br />
Mr. F. A. A. Jasdanwala May 20, 1960 July 31, 2007 Resignation<br />
Mr. Rajan Raheja February 14, 1994 April 9, 2008 Resignation<br />
Mr. Viren Rajan Raheja April 15, 2008 - -<br />
Mr. Nikhil Shyam Ghia January 24, 2000 December 31, 2005 Resignation<br />
Mr. Nikhil Shyam Ghia May 30, 2008 - Appointment<br />
Mr. K. Ramasubramanian May 30, 2008 - Appointment<br />
MANAGEMENT ORGANISATION STRUCTURE<br />
Mr. Shyam Bhupatirai Ghia<br />
Chairman & Managing Director<br />
Mr. Mukund Dharamdas Dalal<br />
Joint Managing Director<br />
S.T. Kulkarni G. Venkatesh S. Rangarajan Dr. B. Sahu S.B. Chatterjee S.<br />
Ramachandran<br />
Director & Executive Chief Operating Executive Executive Executive<br />
Director<br />
President Director – Officer & Exe- Director & Director & & President<br />
(Legal)<br />
Marketing & cutive President President -- President -- and<br />
Company<br />
Manufacturing HRD & Finance Secretary<br />
Admn.<br />
CORPORATE GOVERNANCE<br />
The guidelines in respect of corporate governance are applicable to our Company as its Equity Shares are listed<br />
on BSE. Our Company is ensuring on-going compliance with all requirements pertaining to corporate<br />
governance.<br />
69
Our Company has regularly complied with all mandatory and also some of non-mandatory requirements of<br />
corporate governance norms as enumerated in Clause 49 of the Listing Agreements with Stock Exchange.<br />
SEBI (Prohibition of Insider Trading) Code<br />
Our Company has adopted the code of conduct for prevention of insider trading at its Board meeting held on<br />
April 29, 2002 pursuant to the provisions of SEBI (Prohibition of Insider Trading) Regulations, 1992. Mr. S.<br />
Ramachandran, our Company Secretary, is the Compliance Officer under this code.<br />
Pursuant to the provisions of Clause 49 of the Listing Agreement, we have constituted the following committees<br />
of the Board, that is, Audit Committee, Remuneration committee and Investor Grievances Committee, in<br />
accordance with the said provisions.<br />
Audit Committee<br />
Composition:<br />
The Audit Committee presently comprises of five Directors. Four of them are independent Directors and one is<br />
a non-executive Director.<br />
The constitution of Audit Committee is as follows:<br />
70
Names of the Directors Designation in the Nature<br />
of<br />
Committee Directorship<br />
Mr. Shyam Sunder Sami Chairman Independent Director<br />
Mr. Sharad Shreepad Marathe Member Independent Director<br />
Mr. Vispi Rusi Patel Member Independent Director<br />
Mr. Prathipati Abraham Member Independent Director<br />
Mr. Viren Rajan Raheja Member Non-Executive Director<br />
Terms of reference:<br />
The terms of reference of the audit committee includes the matters specified under Clause 49 (II) (D) of the<br />
Listing Agreement as well as in Section 292A of the Companies Act, 1956.<br />
Number of meetings:<br />
During the financial year 2007-2008, six meetings were held. The dates of the meeting were April 25, 2007;<br />
June 21, 2007; July 25, 2007; September 19, 2007; October 31, 2007 and January 29 2008.<br />
Remuneration Committee<br />
Composition:<br />
The Remuneration Committee comprises of three Directors members and all the three members are Independent<br />
Directors.<br />
The constitution of the Remuneration Committee is as follows:<br />
Names of the Directors Designation in the Nature<br />
of<br />
Committee Directorship<br />
Mr. Shyam Sunder Sami Chairman Independent Director<br />
Mr. Vispi Rusi Patel Member Independent Director<br />
Mr. Prathipati Abraham Member Independent Director<br />
Terms of reference:<br />
To periodically review the remuneration package of executive whole-time directors and recommend suitable<br />
revision to the Board.<br />
Remuneration policy:<br />
The remuneration policy is directed towards rewarding performance. It takes into account our Company’s<br />
results, the grade and the position held by the incumbent concerned and his overall performance.<br />
Number of meetings:<br />
No meetings were held during the financial year 2007-2008 as no revision was made in the managerial<br />
remuneration during the year.<br />
Investor Grievances Committee<br />
Composition:<br />
The Investor Grievances Committee comprises of three members.<br />
The constitution of the Investor Grievances Committee is as follows:<br />
Names of the Directors Designation in the Nature<br />
of<br />
Committee Directorship<br />
Mr. Nikhil Shyam Ghia Chairman Non-Executive Director<br />
Mr. Shyam Bhupatirai Ghia Member Executive Director<br />
Mr. Mukund Dharamdas Dalal Member Executive Director<br />
71
Terms of reference:<br />
The Shareholders’ Investors Grievance was constituted specifically to look into the redressal of shareholders<br />
grievances.<br />
Complaints:<br />
Details of Complaints received and redressed are as follows:<br />
Sr. No Details of Investor Complaints No. of Complaints<br />
1. Complaints received from April 01, 2007 to July 04, 2008 19<br />
2. Complaints redressed during the period 19<br />
3. Complaints pending Nil<br />
Number of meetings: During the financial year 2007-2008,four meeting were held. The dates of the meeting<br />
are April 05, 2007; July 16, 2007; October 23, 2007 and January 15, 2008.<br />
KEY MANAGERIAL PERSONNEL<br />
The key managerial personnel of our Company (other than ourwhole-time Directors as on the date of the Draft<br />
Letter of Offer are as follows.<br />
Name<br />
Mr. Srinivasan<br />
Rangarajan<br />
Age<br />
(in<br />
years)<br />
Date of<br />
Joining<br />
59 October<br />
31,<br />
1986<br />
Designation Qualifications Experience<br />
(in years)<br />
Chief<br />
Operating<br />
Officer<br />
Executive<br />
President<br />
and<br />
Bachelor in<br />
Engineering<br />
(Mechanics)<br />
from<br />
University of<br />
Madras<br />
Remuneration<br />
Received in<br />
last FY (Rs.)<br />
Previous<br />
Employment<br />
38 33,32,000 Kunal<br />
Machinery<br />
Manufacturers<br />
Limited<br />
Mr. Sanjay<br />
Tammaji<br />
Kulkarni<br />
51 March<br />
10,<br />
2002<br />
Director<br />
President<br />
and<br />
Diploma in<br />
Materials<br />
Management<br />
from<br />
University of<br />
Madras<br />
and<br />
Executives’<br />
Masters’ in<br />
International<br />
Trade from<br />
Indian<br />
Institute of<br />
Foreign Trade,<br />
New Delhi<br />
Bachelor of<br />
Technology<br />
(Chemical<br />
Engineering)<br />
from<br />
Karnataka<br />
Regional<br />
Engineering<br />
College,<br />
Surathkal<br />
29 40,45,000 Pearl<br />
Engineering<br />
Polymers<br />
Limited, Pune<br />
72
Mr. Gopalan<br />
Venkatesh<br />
46 October<br />
6, 2006<br />
Executive<br />
Director<br />
[Marketing and<br />
Manufacturing]<br />
B.Tech from<br />
Anna<br />
University,<br />
Madras and<br />
PG Diploma<br />
in Business<br />
Management<br />
from Pune<br />
University<br />
24 25,40,000 Tuntex<br />
Thailand<br />
Dr. B. Sahu 57 April 2,<br />
1985<br />
Mr. S. B.<br />
Chatterjee<br />
Mr. S.<br />
Ramachandran<br />
54 October<br />
7, 1994<br />
64 June 2,<br />
1995<br />
Executive<br />
Director and<br />
President [HR<br />
and<br />
Administration]<br />
Executive<br />
Director<br />
President<br />
[Finance]<br />
Executive<br />
Director<br />
President<br />
[Legal]<br />
Company<br />
Secretary<br />
and<br />
and<br />
&<br />
Master of<br />
Arts,<br />
Personnel<br />
Management<br />
and Industrial<br />
Relations and<br />
Directorate in<br />
Management<br />
and<br />
Organizational<br />
Behaviour.<br />
Bachelor of<br />
Commerce<br />
(Hons.),<br />
Associate<br />
Chartered<br />
Accountant,<br />
Associate<br />
Company<br />
Secretary<br />
Bachelor of<br />
Arts, Bachelor<br />
of General<br />
Laws, Master<br />
of<br />
Administrative<br />
Management,<br />
Fellow<br />
Company<br />
Secretary.<br />
32 25,04,789 N.I.T.I.E.<br />
Bombay<br />
22 22,41,038 AMP Tools<br />
(I) Private<br />
Limited.<br />
32 18,27,680 Cables<br />
Corp of<br />
India<br />
Limited.<br />
Notes:<br />
1. The remuneration of all key managerial personnel is for the period April 1, 2007 to March 31, 2008.<br />
2. All the employees have adequate experience to discharge the responsibilities assigned to them.<br />
3. All key managerial personnel are permanent employees of our Company.<br />
4. None of the key managerial personnel are relatives of our Directors or Promoters.<br />
Shareholding of Key Managerial Personnel<br />
The following is the shareholdings of our key managerial personnel as on date the Draft Letter of Offer.<br />
Name<br />
Number of Shares Held<br />
Mr. Srinivasan Rangarajan -<br />
Mr. Sanjay Tammaji Kulkarni -<br />
Mr. Gopalan Venkatesh -<br />
Dr. B. Sahu -<br />
Mr. S. B. Chatterjee 200<br />
Mr. S. Ramachandran 50<br />
The aggregate shareholding of the key managerial personnel of our Company as on date of filing of the Draft<br />
Letter of Offer is 250 Equity Shares of our Company.<br />
73
Interest of key managerial personnel<br />
Our key managerial personnel do not have any interest in our Company other than to the extent of the<br />
remuneration or benefits to which they are entitled to as per their terms of appointment and reimbursement of<br />
expenses incurred by them during the ordinary course of business and to the extent of the Equity Shares held by<br />
them in our Company, if any.<br />
Bonus or Profit Sharing Plan for the Key Managerial Personnel<br />
We do not have any specific bonus or profit sharing plan for our key managerial personnel.<br />
Changes in the Key Managerial Personnel in the last three years<br />
Following are the changes in key managerial personnel in the last three years :<br />
Name Designation Date of retirement / Reason<br />
appointed<br />
Mr. J. Panneerselvam Executive Director and Joint President July 31, 2007 Retired<br />
Mr. Gopalan Executive Director [Marketing and October 06, 2006<br />
Appointed<br />
Ventakesh<br />
Manufacturing]<br />
EMPLOYEES<br />
We believe that a motivated and empowered employee base is integral to our competitive advantage. Our<br />
Company has 827 employees as on March 31, 2008. For details regarding the break-up of employees among our<br />
offices and divisions, please refer chapter titled “Business Overview” beginning on page 31 of the Draft Letter of<br />
Offer.<br />
Employee Stock Options<br />
As on date of the Draft Letter of Offer, our Company does not have any employee stock option scheme or<br />
employee stock purchase scheme.<br />
Non salary related payment or benefit to our employees / key managerial personnel<br />
There has been no other payment or benefit given to the employees / key managerial personnel of our Company<br />
other than in accordance with their respective terms of employment.<br />
74
OUR PROMOTERS<br />
Our Company has two Promoters, namely Mr. Shyam Bhupatirai Ghia and Mr. Mukund Dharamdas Dalal.<br />
Their details are as follows:<br />
1. Mr. Shyam Bhupatirai Ghia<br />
Driving License Number: 0107219<br />
Voter Identity Card Number: MT/04/024/231484<br />
Permanent Account Number: AACPG6187A<br />
Passport Details: Z1J88787<br />
Mr. Shyam Bhupatirai Ghia is 60 years old and is a resident of India. He holds a Bachelor’s Degree in<br />
Chemistry from the University of Mumbai and Master’s Degree in Business Administration from Bowling<br />
Green State University, Ohio, United States of America. Further, he has also undergone practical training in<br />
Administration and Commerce at Bayer’s offices in New York, United States of America and Leverkusen in<br />
Germany. Mr. Shyam Bhupatirai Ghia, has extensive experience spanning over thirty years, in industry. He<br />
joined our Company from March 01, 1972 as Director, Administration and was elevated to the Board as a<br />
Whole-time Director with effect from October 18, 1973. Subsequently, elevated to the position of Joint<br />
Managing Director with effect from January 01, 1988 and as Managing Director with effect from August 23,<br />
1990<br />
2. Mr. Mukund Dharamdas Dalal<br />
Driving License Number: 515889<br />
Voter Identity Card Number: MT/04/024/069953<br />
Permanent Account Number: AAAPD8330Q<br />
Passport Details: F4200973<br />
Mr. Mukund Dharamdas Dalal, is 51 years old and is a resident of India. He holds a Bachelor’s Degree in<br />
Chemical Engineering from Salford University, United Kingdom and Master of Science Degree in Chemical<br />
Engineering from Massachusetts Institute of Technology (MIT), United States of America. Further, he has<br />
undergone extensive training in the production plants of Chemische Werke Huls, AG, West Germany and has<br />
also been associated with various research projects. Mr. Mukund Dharamdas Dalal joined the services of our<br />
Company with effect from December 11, 1980, as Manager Projects and Planning. He was promoted to the<br />
position of General Manager, Futura Synthetics Division with effect from August 01, 1983 till December 31,<br />
1987. With effect from January 01, 1988, he was elevated to the Board as a Whole-Time Director and was<br />
designated as Director-Technical. Thereafter, he was promoted to the position of a Joint Managing Director<br />
from April 01, 1992.<br />
Other Confirmations<br />
We confirm that the details of the permanent account numbers, bank account numbers and passport numbers of<br />
our Promoters will be submitted to the Stock Exchange at the time of filing the Draft Letter of Offer with the<br />
Stock Exchange.<br />
Further, our Promoters have not been identified as wilful defaulters by Reserve Bank of India or any other<br />
Government Authority and there are no violations of securities laws committed by our Promoters in the past or<br />
any such proceedings are pending against our Promoters.<br />
Interest of Promoters<br />
75
Save and except as stated otherwise in the chapters titled “Business Overview”, “Our Management” and<br />
“Financial Information” beginning on pages 31, 60 and 113, respectively, of the Draft and section titled Letter<br />
of Offer, and to the extent of Equity Shares held by them, our Promoters do not have any other interests in our<br />
Company as on the date of filing of the Draft Letter of Offer with SEBI.<br />
Our Promoters do not have any interest in:<br />
a) The promotion of our Company; or<br />
b) Any property acquired by our Company within two years of the date of the draft Letter of Offer or<br />
currently proposed to be acquired by our Company.<br />
Payment or Benefit to our Promoters<br />
No payment has been made or benefit given to our Promoters in the two years preceding the date of the Draft<br />
Letter of Offer except as mentioned/referred to in this section and in the chapters titled “Business Overview”<br />
“Our Management” “Financial Information” beginning on pages 31, 60 and 113 respectively, of the Draft<br />
Letter of Offer.<br />
Common Pursuits<br />
Our Promoters are not currently engaged in the areas in which our Company operates through any other person<br />
or entity other than our Company, and therefore there are no common pursuits as on date of the Draft Letter of<br />
Offer.<br />
Related Party Transactions<br />
For details on our related party transactions please refer to the chapter titled ‘Financial Information’ beginning<br />
on page 113 of the Draft Letter of Offer.<br />
Relationship between Promoters-<br />
Our Promoters are not ‘relatives’ within the meaning of that term contained in Section 6 of the Companies Act.<br />
76
OUR PROMOTER GROUP ENTITIES<br />
Note: All financial information of Promoter Group Entities appearing in this section are in Rs. Lacs, unless<br />
stated otherwise.<br />
Details of our listed Promoter Group Entities are mentioned as hereunder<br />
1. Sonata Software Limited<br />
Brief History<br />
Sonata Software Limited was incorporated on October 18, 1994, under the Companies Act, 1956, having its<br />
registered office situated at 208, T V Industrial Estate, S.K. Ahire Marg, Worli, Mumbai-400030. Sonata<br />
Software Limited was formed for the purpose of taking over the software division of our Company. The shares<br />
of Sonata Software Limited are listed on the Bombay Stock Exchange, National Stock Exchange and Bangalore<br />
Stock Exchange.<br />
Nature of Activities<br />
The company was incorporated with the main object of carrying on software development and programming<br />
including systems implementation for data processing equipments and acting as consultants.<br />
Board of Directors<br />
The Board of Directors of Sonata Software Limited as on March 31, 2008 consists of<br />
Name<br />
Position<br />
Shyam Bhupatirai Ghia Chairman<br />
Mukund Dharamdas Dalal Executive Vice Chairman<br />
Viren Rajan Raheja Director<br />
Pradip P. Shah<br />
Director<br />
B. Ramaswamy Managing Director & President<br />
P Srikar Reddy<br />
Executive Vice President & Chief Operating Officer<br />
S.N. Talwar<br />
Director<br />
B.K. Syngal<br />
Director<br />
Shareholding Pattern<br />
The shareholding pattern of this company as on March 31, 2008 is as under<br />
Category No. of Shares held Percentage of Holding<br />
Promoters 47,747,850 45.41<br />
Banks, FIS, MFs etc. 847,054 0.80<br />
FIIs/NRIs 6,286,414 5.98<br />
Bodies Corporate 9,093,430 8.65<br />
Public 41,184,558 39.16<br />
Total 105,159,306 100.00<br />
Financial Performance<br />
The financial performance of this company for last three years is as below<br />
Particulars<br />
For the year ending<br />
on March 31, 2006<br />
For the year ending<br />
on March 31, 2007<br />
For the year ending<br />
on March 31, 2008<br />
Total Revenue 15207.98 18823.42 20110.28<br />
Profit After Tax 777.99 3512.91 3668.93<br />
Equity Share <strong>Capital</strong> 1051.59 1051.59 1051.59<br />
Reserves (excluding 14626.36 16801.54 18871.68<br />
Revaluation Reserves)<br />
Networth 15677.95 17853.13 19923.27<br />
Basic EPS per share of 2.49 3.34 3.49<br />
Rs. 1<br />
NAV per share of Rs. 1 14.91 16.98 18.95<br />
77
Price of the Scrip for the last six months for the BSE<br />
Month High (Rs. ) Low (Rs. )<br />
December 2007 64.50 41.00<br />
January 2008 58.50 32.10<br />
February 2008 45.25 36.40<br />
March 2008 41.95 27.10<br />
April 2008 44.65 32.50<br />
May 2008 41.00 30.80<br />
June 2008 35.50 26.00<br />
Price of the Scrip for the last six months for the National Stock Exchange of India Limited<br />
Month High (Rs. ) Low (Rs. )<br />
December 2007 64.70 41.80<br />
January 2008 58.20 32.20<br />
February 2008 45.40 36.50<br />
March 2008 41.70 27.50<br />
April 2008 44.80 32.50<br />
May 2008 41.50 32.65<br />
June 2008 35.30 26.00<br />
Stock Market Data<br />
Stock Market Data<br />
Bombay Stock Exchange<br />
Market Price as on July 08, 2008 with Stock Exchange Rs. 26.00<br />
Stock Exchange Data<br />
National Stock Exchange<br />
Market Price as on July 08, 2008 with Stock Exchange Rs. 26.00<br />
Details of our Unlisted Corporate Promoter Group Entities are mentioned as hereunder<br />
1. Viraj Investments Private Limited<br />
Brief History<br />
Viraj Investments Private Limited was incorporated on January 29, 1979, under the Companies Act, 1956,<br />
having its registered office situated at B-34/35, 3 rd Floor, Paragon Condominium, P.B. Marg, Worli, Mumbai-<br />
400013. The shares of Viraj Investments Private Limited are not listed on any of the stock exchanges in India.<br />
Nature of Activities<br />
The company is a Non-Banking Financial Company and with its main object of investing funds in shares,<br />
securities, units of mutual funds and lending funds to the group companies.<br />
Board of Directors<br />
The Board of Directors of Viraj Investments Private Limited as on March 31, 2008 consists of<br />
Name<br />
Shyam Bhupatirai Ghia<br />
V.D. Ghia<br />
R.S. Ghia<br />
Nikhil Shyam Ghia<br />
Position<br />
Director<br />
Director<br />
Director<br />
Director<br />
Shareholding Pattern<br />
The shareholding pattern of this company as on March 31, 2008 is as under<br />
78
Category No. of Shares held Percentage of Holding<br />
Ghia Family 14,566 100<br />
Total 14,566 100<br />
Financial Performance<br />
The financial performance of this company for last three years is as below<br />
Particulars<br />
For the year ending<br />
on March 31, 2005<br />
For the year ending<br />
on March 31, 2006<br />
For the year ending<br />
on March 31, 2007<br />
Total Revenue 9.77 22.97 0.50<br />
Profit After Tax 8.20 21.62 (0.96)<br />
Equity Share <strong>Capital</strong> 14.57 14.57 14.57<br />
Reserves (excluding 101.22 122.84 121.89<br />
revaluation reserves)<br />
Net Worth 115.78 137.41 136.45<br />
EPS per share of Rs. 56.33 148.46 (6.57)<br />
100<br />
NAV per share of Rs.<br />
100<br />
794.89 943.35 936.78<br />
2. Bhupati Investments & Finance Private Limited<br />
Brief History<br />
Bhupati Investments & Finance Private Limited was incorporated on November 08, 1974, under the Companies<br />
Act, 1956, having its registered office situated at B-34/35, 3 rd Floor, Paragon Condominium, Pandurang<br />
Budhakar Marg, Worli, Mumbai-400013. The shares of Bhupati Investments & Finance Private Limited are not<br />
listed on any of the stock exchanges in India.<br />
Nature of Activities<br />
The company was incorporated with the main object of investment in securities and lending of funds.<br />
Board of Directors<br />
The Board of Directors of Bhupati Investments & Finance Private Limited as on March 31, 2008 consists of<br />
Name<br />
Rajul S Ghia<br />
Vishakha D. Ghia<br />
Paresh B. Parekh<br />
Rusi H Patel<br />
Basu T. Chaterjee<br />
Sunil P. Sheth<br />
Position<br />
Chairperson and Director<br />
Director<br />
Director<br />
Director<br />
Director<br />
Director<br />
79
Shareholding Pattern<br />
The shareholding pattern of this company as on March 31, 2008 is as under<br />
Category No. of Shares held Percentage of Holding<br />
Nikhil Shyam Ghia 1665 5.80<br />
Bodies Corporate 19,165 66.73<br />
Foreign Bodies Corporate 7890 27.47<br />
Total 28,720 100<br />
Financial Performance<br />
The financial performance of this company for last three years is as below<br />
Particulars For the year ending<br />
on March 31, 2005<br />
For the year ending<br />
on March 31, 2006<br />
For the year ending<br />
on March 31, 2007<br />
Total Revenue 216.29 256.11 407.24<br />
Profit After Tax 159.17 222.79 381.71<br />
Equity Share <strong>Capital</strong> 24.97 24.97 24.97<br />
Reserves (excluding 2,691.32 3,043.67 3,447.78<br />
Revaluation Reserves)<br />
Networth 2,717.79 3,070.14 3,474.25<br />
EPS per share of Rs. 637.43 892.23 1,527.85<br />
100<br />
NAV per share of Rs.<br />
100<br />
10,884.22 12,295.31 13,913.71<br />
3. Distributors (Bombay) Private Limited<br />
Brief History<br />
Distributors (Bombay) Private Limited was incorporated on October 11, 1941, having its registered office<br />
situated at B-34/35, 3 rd Floor, Paragon Condominium, P.B. Marg, Worli, Mumbai-400013. The shares of<br />
Distributors (Bombay) Private Limited are not listed on any of the stock exchanges in India.<br />
Nature of Activities<br />
The company was registered as a Non-Banking Financial Corporation with the main objects of investments of<br />
its funds in mutual funds, shares and securities, financing and to manage the immovable property of the<br />
company.<br />
Board of Directors<br />
The Board of Directors of Distributors (Bombay) Private Limited as on March 31, 2008 consists of<br />
Name<br />
V.D. Ghia<br />
R.S. Ghia<br />
Nikhil Shyam Ghia<br />
P.B Parekh<br />
S.D. Shah<br />
Position<br />
Chairperson<br />
Managing Director<br />
Director<br />
Director<br />
Director<br />
Shareholding Pattern<br />
The shareholding pattern of this company as on March 31, 2008 is as under<br />
Category No. of Shares held Percentage of Holding<br />
Ghia Family 61,406 58.90<br />
Bodies Corporate 42,860 41.10<br />
Total 1,04,266 100<br />
Financial Performance<br />
80
The financial performance of this company for last three years is as below<br />
Particulars For the year ending<br />
on March 31, 2005<br />
For the year ending<br />
on March 31, 2006<br />
For the year ending<br />
on March 31, 2007<br />
Total Revenue 46.37 56.94 28.18<br />
Profit After Tax 24.61 45.87 4.50<br />
Equity Share <strong>Capital</strong> 48.20 48.20 104.27<br />
Reserves (Excluding<br />
246.40 231.23<br />
200.53<br />
Revaluation Reserves)<br />
Networth 288.73 334.60 785.50<br />
EPS per share of Rs. 100 51.05 95.16 0<br />
NAV per share of Rs.<br />
694.19 753.36<br />
599.02<br />
100<br />
4. Chika Private Limited<br />
Brief History<br />
Chika Private Limited was incorporated on September 25, 1973, under the Companies Act, 1956, having its<br />
registered office situated at Industrial Assurance Building, 5 th Floor, Churchgate, Mumbai-40020. The shares of<br />
Chika Private Limited are not listed on any of the stock exchanges in India.<br />
Nature of Activities<br />
The company was incorporated with the main object of carrying on the business as shippers including ship<br />
designing and other allied activities.<br />
Board of Directors<br />
The Board of Directors of Chika Private Limited as on March 31, 2008 consists of<br />
Name<br />
Position<br />
Shyam Bhupatirai Ghia Chairman<br />
Nikhil Shyam Ghia Managing Director<br />
R.H. Patel<br />
Director<br />
V.C. Vaidya<br />
Director<br />
A.K. Hirjee<br />
Director<br />
D.G. Sinh<br />
Director<br />
S. Uttamsingh Director<br />
A.H. Parpia<br />
Director<br />
Shareholding Pattern<br />
The shareholding pattern of this company as on March 31, 2008 is as under<br />
Category<br />
Bhupati Investments & Finance Private Limited and<br />
its nominees<br />
No. of Shares Percentage of<br />
held<br />
Holding<br />
8,24,242 100.00<br />
Financial Performance<br />
The financial performance of this company for last three years is as below<br />
Particulars For the year ending<br />
on March 31, 2005<br />
For the year ending<br />
on March 31, 2006<br />
For the year ending<br />
on March 31, 2007<br />
Total Revenue 641.96 1111.28 1068.71<br />
Profit After Tax 33.33 185.16 140.52<br />
Equity Share <strong>Capital</strong> 82.42 82.42 82.42<br />
Reserves (excluding 183.50 368.66 509.19<br />
revaluation reserves)<br />
81
Net Worth 242.10 437.43 588.11<br />
EPS per share of Rs. 4.04 22.46 17.05<br />
100<br />
NAV per share of Rs. 29.37 53.07 71.35<br />
5. Meridion Overseas Private Limited<br />
Brief History<br />
Meridion Overseas Private Limited was incorporated on March 04, 1993 under the Companies Act, 1956 having<br />
its registered office situated at Industrial Assurance Building, 5 th Floor, Churchgate, Mumbai-400020. The<br />
shares of Meridion Overseas Private Limited are not listed on any of the stock exchanges in India.<br />
Nature of Activities<br />
The company was incorporated with the main object of acquiring the business of Meridion Private Enterprises, a<br />
partnership concern, and subsequently carrying on the activity of dealing in dyes, dyestuffs, chemicals and other<br />
products.<br />
Board of Directors<br />
The Board of Directors of Meridion Overseas Private Limited as on March 31, 2008 consists of<br />
Name<br />
V.D. Ghia<br />
N.N. Ghia<br />
Nikhil Shyam Ghia<br />
R.S Ghia<br />
Position<br />
Managing Director<br />
Joint Managing Director<br />
Director<br />
Director<br />
Shareholding Pattern<br />
The shareholding pattern of this company as on March 31, 2008 is as under<br />
Category No. of Shares held Percentage of Holding<br />
Ghia Family 252,000 100<br />
Total 252,000 100<br />
Financial Performance<br />
The financial performance of this company for last three years is as below<br />
Particulars For the year ending<br />
on March 31, 2005<br />
For the year ending<br />
on March 31, 2006<br />
For the year ending<br />
on March 31, 2007<br />
Total Revenue 423.45 481.50 283.01<br />
Profit After Tax 30.81 51.07 42.40<br />
Equity Share <strong>Capital</strong> 25.25 25.25 25.25<br />
Reserves (excluding 512.14 535.56 544.85<br />
revaluation reserves)<br />
Net Worth 537.39 560.81 570.10<br />
EPS per share of Rs. 10 12.20 20.22 16.79<br />
NAV per share of Rs. 10 212.83 222.10 225.78<br />
6. Brahmasonic Sound Production Private Limited<br />
Brief History<br />
Brahmasonic Sound Production Private Limited was incorporated on January 27, 1993, under the name of Bachi<br />
Investments & Finance Private Limited and later on changed its name to Brahmasonic Sound Production Private<br />
Limited with effect from April 08, 2003, under the Companies Act, 1956, having its registered office situated at<br />
Paragon Condominium, 3 rd Floor, Pandurang Budhakar Marg, Worli, Mumbai-400013. The shares of<br />
Brahmasonic Sound Production Private Limited are not listed on any of the stock exchanges in India.<br />
82
Nature of Activities<br />
The company was originally incorporated with the main object of carrying on Finance and Investment activities<br />
which has been subsequently changed to carry out the business of producers, manufacturers, distributors etc. of<br />
sound recordings.<br />
Board of Directors<br />
The Board of Directors of Brahmasonic Sound Production Private Limited as on March 31, 2008 consists of<br />
Name<br />
Shyam Bhupatirai Ghia<br />
R.H. Patel<br />
Nikhil Shyam Ghia<br />
Position<br />
Director<br />
Director<br />
Director<br />
Shareholding Pattern<br />
The shareholding pattern of this company as on March 31, 2008 is as under<br />
Category No. of Shares held Percentage of Holding<br />
Ghia Family 86 0.20<br />
Bodies Corporate 44,914 99.80<br />
Total 45,000 100<br />
Financial Performance<br />
The financial performance of this company for last three years is as below<br />
Particulars For the year ending<br />
on March 31, 2005<br />
For the year ending<br />
on March 31, 2006<br />
For the year ending<br />
on March 31, 2007<br />
Total Revenue 5.81 6.86 8.27<br />
Profit After Tax (1.35) (0.93) (0.48)<br />
Equity Share <strong>Capital</strong> 45.00 45.00 45.00<br />
Reserves (excluding<br />
7.61 6.68 6.21<br />
revaluation reserves)<br />
Net Worth 52.61 51.68 51.21<br />
EPS per share of Rs. (3.00) (2.06) (1.06)<br />
100<br />
NAV per share of Rs.<br />
100<br />
116.91 114.85 113.79<br />
7. Chika Overseas Private Limited<br />
Brief History<br />
Chika Overseas Private Limited was incorporated on February 23, 1989, under the Companies Act, 1956,<br />
having its registered office situated at Industrial Assurance Building, 5 th Floor, Opposite Churchgate Station,<br />
Mumbai-400020. The shares of Chika Overseas Private Limited are not listed on any of the stock exchanges in<br />
India<br />
Nature of Activities<br />
The company was incorporated with the main object of dealing in real estate including agricultural and other<br />
lands.<br />
Board of Directors<br />
The Board of Directors of Chika Overseas Private Limited as on March 31, 2008<br />
Name<br />
Shyam Bhupatirai Ghia<br />
Nikhil Shyam Ghia<br />
Position<br />
Chairman<br />
Managing Director<br />
83
R.H. Patel<br />
S.D. Shah<br />
V.D. Ghia<br />
R.S. Ghia<br />
R.U. Singh<br />
Director<br />
Director<br />
Director<br />
Director Finance<br />
Director Marketing<br />
Shareholding Pattern<br />
The shareholding pattern of this company as on March 31, 2008<br />
Category No. of Shares held Percentage of Holding<br />
Ghia Family 20 0.001<br />
Bodies Corporate and their Nominees 2,033,800 99.999<br />
Total 2,033820 100<br />
Financial Performance<br />
The financial performance of this company for last three years is as below<br />
Particulars For the year ending<br />
on March 31, 2005<br />
For the year ending<br />
on March 31, 2006<br />
For the year ending<br />
on March 31, 2007<br />
Total Revenue 2339.82 2,231.66 2,182.18<br />
Profit After Tax 66.37 70.85 (98.09)<br />
Equity Share <strong>Capital</strong> 203.38 203.308 203.38<br />
Reserves (excluding 2040.17 2,064.06 1907.99<br />
revaluation reserves)<br />
Net Worth 2243.55 2,267.44 2,111.38<br />
EPS per share of Rs. 10 3.26 3.48 (4.82)<br />
NAV per share of Rs.<br />
10<br />
110.31 111.49 103.81<br />
8. Kika Dye Chem Exports Private Limited<br />
Brief History<br />
Kika Dye Chem Exports Private Limited was incorporated on December 02, 1993 under the Companies Act,<br />
1956, having its registered office situated at Chemtex House, First Floor, Hiranandani Gardens, Powai,<br />
Mumbai- 400 076. The shares of Kika Dye Chem Exports Private Limited are not listed on any of the stock<br />
exchanges in India.<br />
Nature of Activities<br />
The company was incorporated with the main object of dealing in dyes, dyestuffs, chemicals and related<br />
products.<br />
Board of Directors<br />
The Board of Directors of Kika Dye Chem Exports Private Limited as on March 31, 2008 consists of<br />
Name<br />
N.N. Ghia<br />
V.D. Ghia<br />
R.S. Ghia<br />
Position<br />
Managing Director<br />
Director<br />
Director<br />
Shareholding Pattern<br />
The shareholding pattern of this company as on March 31, 2008 is as under<br />
Category No. of Shares held Percentage of Holding<br />
Ghia Family 3520 6.98<br />
Bodies Corporate including their nominees 46,890 93.02<br />
Total 50,410 100<br />
84
Financial Performance<br />
The financial performance of this company for last three years is as below<br />
Particulars For the year ending<br />
on March 31, 2005<br />
For the year ending<br />
on March 31, 2006<br />
For the year ending<br />
on March 31, 2007<br />
Total Revenue 94.40 99.62 101.82<br />
Profit After Tax 7.34 8.25 5.13<br />
Equity Share <strong>Capital</strong> 5.04 5.04 5.04<br />
Reserves (excluding 102.79 111.04 116.16<br />
revaluation reserves)<br />
Net Worth 107.83 116.08 121.21<br />
EPS per share of Rs. 10 14.58 15.87 10.17<br />
NAV per share of Rs. 10 213.90 230.27 240.44<br />
9. Kika Investments & Finance Private Limited<br />
Brief History<br />
Kika Investments & Finance Private Limited was incorporated on March 18, 1992, under the Companies Ac,<br />
1956, having its registered office situated at B-34/35, 3 rd Floor, Paragon Condominium, P.D. Marg, Worli,<br />
Mumbai-400013. The shares of Kika Investments & Finance Private Limited are not listed on any of the stock<br />
exchanges in India.<br />
Nature of Activities<br />
The company is a non-banking financial company and with the main object of investing funds in shares,<br />
securities, units of mutual funds and giving intercorporate deposits.<br />
Board of Directors<br />
The Board of Directors of Kika Investments & Private Limited as on March 31, 2008 consists of<br />
Name<br />
Shyam Bhupatirai Ghia<br />
S.D. Shah<br />
Nikhil Shyam Ghia<br />
Position<br />
Director<br />
Director<br />
Director<br />
Shareholding Pattern<br />
The shareholding pattern of this company as on March 31, 2008 is as under<br />
Category No. of Shares held Percentage of Holding<br />
Ghia Family 86 0.42<br />
Bodies Corporate 20,104 99.58<br />
Total 20,190 100<br />
Financial Performance<br />
The financial performance of this company for last three years is as below<br />
Particulars For the year ending<br />
on March 31, 2005<br />
For the year ending<br />
on March 31, 2006<br />
For the year ending<br />
on March 31, 2007<br />
Total Revenue 17.38 44.02 1.93<br />
Profit After Tax 15.70 43.03 0.33<br />
Equity Share <strong>Capital</strong> 20.19 20.19 20.19<br />
Reserves (excluding 36.81 79.84 80.18<br />
revaluation reserves)<br />
Net Worth 57.00 100.03 100.37<br />
EPS per share of Rs. 77.78 213.12 1.66<br />
85
100<br />
NAV per share of Rs.<br />
100<br />
282.33 495.45 497.11<br />
10. Kharsundi Chemicals Private Limited<br />
Brief History<br />
Kharsundi Chemicals Private Limited was incorporated on November 15, 1984, under the Companies Act,<br />
1956, having its registered ffice situated at 3 rd Floor, Paragon Condominium, P.B. Marg, Worli, Mumbai-<br />
400013. The shares of Kharsundi Chemicals Private Limited are not listed on any of the stock exchanges in<br />
India.<br />
Nature of Activities<br />
The company was incorporated with the main object of manufacturing various chemicals. At present the<br />
company is not doing any business.<br />
Board of Directors<br />
The Board of Directors of Kharsundi Chemicals Private Limited as on March 31, 2008 consists of<br />
Name Position<br />
Paresh Parekh Director<br />
S. Ramachandran Director<br />
Shareholding Pattern<br />
The shareholding pattern of this company as on March 31, 2008 is as under<br />
Category No. of Shares held Percentage of Holding<br />
Bhupati Investments Finance Limited 134,000 67<br />
Individuals 66,000 33<br />
Total 200,000 100<br />
Financial Performance<br />
The financial performance of this company for last three years is as below<br />
Particulars For the year ending<br />
on March 31, 2005<br />
For the year ending<br />
on March 31, 2006<br />
For the year ending<br />
on March 31, 2007<br />
Total Revenue 7.10 6.65 6.57<br />
Profit After Tax (1.34) 2.16 2.68<br />
Equity Share <strong>Capital</strong> 20.00 20.00 20.00<br />
Reserves (exclusion 53.83 56.00 58.67<br />
revaluation reserves)<br />
Net Worth 73.83 76.00 78.67<br />
EPS per share of Rs. 10 (0.67) 2.01 1.34<br />
NAV per share of Rs.<br />
10<br />
36.91 38.00 39.34<br />
11. Daltreya Investment & Finance Private Limited<br />
Brief History<br />
Daltreya Investment and Finance Private Limited was incorporated on October 27, 1987, under the Companies<br />
Act, 1956 having its registered office situated at 7, Sital Baug, 64, Walkeshwar Road, Mumbai-400006. The<br />
shares of Daltreya Investment & Finance Private Limited are not listed on any of the stock exchanges in India<br />
86
Nature of Activities<br />
The company was incorporated with the main object of carrying out business as an investment including<br />
underwriting, acquisition of bullion and dealing in securities.<br />
Board of Directors<br />
The Board of Directors of Daltreya Investment & Finance Private Limited as on March 31, 2008 consists of<br />
Name<br />
Ms. K.D. Dalal<br />
Ms. B.M. Dalal<br />
Dr. Deepika Subhash Chandratreya<br />
Position<br />
Director<br />
Director<br />
Director<br />
Shareholding Pattern<br />
The shareholding pattern of this company as on March 31, 2008 is as under<br />
Category No. of Shares held Percentage of Holding<br />
Dalal Family 7525 45.62<br />
Friends & Relatives 970 5.88<br />
Others 8000 48.50<br />
Total 16495 100<br />
Financial Performance<br />
The financial performance of this company for last three years is as below<br />
Particulars For the year ending<br />
on March 31, 2005<br />
For the year ending<br />
on March 31, 2006<br />
For the year ending<br />
on March 31, 2007<br />
Total Revenue 20.61 32.19 24.18<br />
Profit After Tax 18.89 28.20 16.77<br />
Equity Share <strong>Capital</strong> 16.50 16.50 16.50<br />
Reserves (excluding 27.18 55.38 72.15<br />
revaluation reserves)<br />
Net Worth 43.68 71.88 88.65<br />
EPS per share of Rs. 114.48 170.91 101.64<br />
100<br />
NAV per share of Rs.<br />
100<br />
264.73 435.64 537.27<br />
12. Bloomingdale Investments & Finance Private Limited<br />
Brief History<br />
Bloomingdale Investments & Finance Private Limited was incorporated on July 25, 1986 under the Companies<br />
Act, 1956, having its registered office situated at Rahejas, Corner of Main Avenue & V.P. Road, Santacruz<br />
(West), Mumbai-400054. The shares of Bloomingdale Investments & Finance Private Limited are not listed on<br />
any of the stock exchanges in India<br />
Nature of Activities<br />
The company was incorporated with the main object of carrying on the business as an investment and finance<br />
company including venture funding, seed capital funding, underwriting and dealing in securities.<br />
Board of Directors<br />
The Board of Directors of Bloomingdale Investment & Finance Private Limited as on March 31, 2008 consists<br />
of<br />
Name<br />
Rajan Raheja<br />
Position<br />
Director<br />
87
Suman Raheja<br />
Akshay Raheja<br />
Viren Rajan Raheja<br />
Director<br />
Director<br />
Director<br />
Shareholding Pattern<br />
The shareholding pattern of this company as on March 31, 2008<br />
Category No. of Shares held Percentage of Holding<br />
Crescent Property Developers Private Limited 14,850 33<br />
Sea Side Exports Private Limited 15,075 33.50<br />
Prerana Builders Private Limited 15,075 33.50<br />
Total 45,000 100<br />
Financial Performance<br />
The financial performance of this company for last three years is as below<br />
Particulars For the year ending<br />
on March 31, 2005<br />
For the year ending<br />
on March 31, 2006<br />
For the year ending<br />
on March 31, 2007<br />
Total Revenue 241.72 15.37 16.70<br />
Profit After Tax 95.39 5.60 5.13<br />
Equity Share <strong>Capital</strong> 45.00 45.00 45.00<br />
Reserves (excluding 7613.94 7619.72 7623.67<br />
revaluation reserves)<br />
Net Worth 7658.94 7664.72 7668.67<br />
EPS per share of Rs. 211.97 12.45 11.39<br />
100<br />
NAV per share of Rs. 17019.87 17032.71 17041.48<br />
13. Crescent Property Developers Private Limited<br />
Brief History<br />
Crescent Property Developers Private Limited was incorporated on June 01, 1990 under the Companies Act,<br />
1956 having the registered office situated at Rahejas, 4 th Floor, Corner of Main Avenue & V.P. Road, Santacruz<br />
(West), Mumbai-400054. The shares of Crescent Property Developers Private Limited are not listed of any of<br />
the stock exchanges in India<br />
Nature of Activities<br />
The company was incorporated with the main object of carrying on real estate developers and investment<br />
activities.<br />
Board of Directors<br />
The Board of Directors of Crescent Property Developers Private Limited as on March 31, 2008 consists of<br />
Name<br />
Rajan B. Raheja<br />
Suman Raheja<br />
Akshay Raheja<br />
Viren Rajan Raheja<br />
Sanjay Johar<br />
Position<br />
Director<br />
Director<br />
Director<br />
Director<br />
Director<br />
Shareholding Pattern<br />
The shareholding pattern of this company as on March 31, 2008 is as under<br />
Category<br />
No. of Shares Percentage of<br />
held<br />
Holding<br />
Kuntinandan Contractors & Developers Private 4980 33.20<br />
88
Limited<br />
Kuntiputra Properties Private Limited 5010 33.40<br />
Villa Capri Developers Private Limited 5010 33.40<br />
Total 15,000 100<br />
Financial Performance<br />
The financial performance of this company for last three years is as below<br />
Particulars For the year ending<br />
on March 31, 2005<br />
For the year ending<br />
on March 31, 2006<br />
For the year ending<br />
on March 31, 2007<br />
Total Revenue - - -<br />
Profit After Tax (0.12) (0.11) (0.11)<br />
Equity Share <strong>Capital</strong> 15.00 15.00 15.00<br />
Reserves (excluding 0.88 0.77 0.66<br />
revaluation reserves)<br />
Net Worth 15.88 15.77 15.66<br />
EPS per share of Rs. (0.82) (0.73) (0.75)<br />
100<br />
NAV per share of Rs. 105.86 105.12 104.38<br />
89
14. Sea Side Exports Private Limited<br />
Brief History<br />
Sea Side Exports Private Limited was incorporated on June 04, 1990, under the Companies Act, 1956, having its<br />
registered office situated at Rahejas, 4 th Floor, Corner of Main Avenue & V.P. Road, Santacruz (West),<br />
Mumbai-400054. The shares of Sea Side Exports Private Limited are not listed on any of the stock exchanges in<br />
India<br />
Nature of Activities<br />
The company was incorporated with the main object of carrying on the business of real estate development and<br />
investment in securities<br />
Board of Directors<br />
The Board of Directors of Sea Side Exports Private Limited as on March 31, 2008 consists of<br />
Name Position<br />
Rajan Raheja Director<br />
Suman Raheja Director<br />
Akshay Raheja Director<br />
Viren Rajan Raheja Director<br />
A. Castelino Director<br />
Shareholding Pattern<br />
The shareholding pattern of this company as on March 31, 2008 is as under<br />
Category<br />
No. of Shares<br />
held<br />
Percentage of<br />
Holding<br />
Kuntinandan Contractors & Developers Private 5010 33.40<br />
Limited<br />
Kuntiputra Properties Private Limited 5010 33.40<br />
Villa Capri Developers Private Limited 4980 33.20<br />
Total 15,000 100<br />
Financial Performance<br />
The financial performance of this company for last three years is as below<br />
Particulars For the year ending<br />
on March 31, 2005<br />
For the year ending<br />
on March 31, 2006<br />
For the year ending<br />
on March 31, 2007<br />
Total Revenue - - -<br />
Profit After Tax (0.12) (0.11) (0.12)<br />
Equity Share <strong>Capital</strong> 15.00 15.00 15.00<br />
Reserves (excluding 0.43 0.32 0.20<br />
revaluation reserves)<br />
Net Worth 15.43 15.32 15.20<br />
EPS per share of Rs. (0.79) (0.73) (0.83)<br />
100<br />
NAV per share of Rs. 102.90 102.16 101.34<br />
15. Prerana Builders Private Limited<br />
Brief History<br />
Prerna Builders Private Limited, was incorporated on June 09, 1982, under the Companies Act, 1956, having its<br />
registered office situated at Rahejas, Corner of Main Avenue & V.P. Road, Santacruz (West), Mumbai-400054.<br />
The shares of Prerna Builders Private Limited are not listed on any stock exchanges in India.<br />
Nature of Activities<br />
90
The company was incorporated with the main object of carrying on real estate development and investment<br />
activities.<br />
Board of Directors<br />
The Board of Directors of Prerana Builders Private Limited as on March 31, 2008<br />
Name<br />
Rajan Raheja<br />
Suman Raheja<br />
Akshay Raheja<br />
Viren Rajan Raheja<br />
Sanjay Johar<br />
Position<br />
Director<br />
Director<br />
Director<br />
Director<br />
Director<br />
Shareholding Pattern<br />
The shareholding pattern of this company as on March 31, 2008 is as under<br />
Category<br />
No. of Shares<br />
held<br />
Percentage of<br />
Holding<br />
Kuntinandan Contractors & Developers Private 5010 33.40<br />
Limited<br />
Kuntiputra Properties Private Limited 4980 33.20<br />
Villa Capri Developers Private Limited 5010 33.40<br />
Total 15,000 100<br />
Financial Performance<br />
The financial performance of this company for last three years is as below<br />
Particulars For the year ending<br />
on March 31, 2005<br />
For the year ending<br />
on March 31, 2006<br />
For the year ending<br />
on March 31, 2007<br />
Total Revenue - - -<br />
Profit After Tax (0.12) (0.11) (0.12)<br />
Equity Share <strong>Capital</strong> 15.00 15.00 15.00<br />
Reserves (excluding 0.33 0.22 0.10<br />
revaluation reserves)<br />
Net Worth 15.33 15.22 15.10<br />
EPS per share of Rs. (0.83) (0.74) (0.78)<br />
100<br />
NAV per share of Rs.<br />
100<br />
102.20 101.46 100.69<br />
16. Asianet Satellite Communications Limited<br />
Brief History<br />
Asia Satellite Communications Limited was incorporated on September 29, 1992, under the Companies Act,<br />
1956, having its registered office situated at 3 rd Floor, Karimpanal Arcade, East Fort, Thirvananthapuram-<br />
695023. The shares of Asia Satellite Communications Limited are not listed on any stock exchanges in India<br />
Nature of Activities<br />
The company was incorporated with the main object of distribution of satellite and other video sourced signals<br />
through cable networks, satellite receivers and other media and engage in the procurement of all types of film<br />
productions for distribution.<br />
Board of Directors<br />
The Board of Directors of Asianet Satellite Communications Limited, as on March 31, 2008, consists of<br />
91
Name<br />
Position<br />
Rajan Raheja<br />
Director<br />
Rajesh G. Kapadia Director<br />
K. Jayaraman Director<br />
Vijay Aggarwal<br />
Director<br />
Akshay Raheja<br />
Director<br />
Viren Rajan Raheja Director<br />
Vinayak Aggarwal Director<br />
Shareholding Pattern<br />
The shareholding pattern of this company as on March 31, 2008 is as under<br />
Category No. of Shares held Percentage of Holding<br />
Raheja Family 3,03,48,924 36<br />
Bodies Corporate 5,39,51,943 64<br />
Total 8,43,00,867 100<br />
Financial Performance<br />
The financial performance of this company for last three years is as below<br />
Particulars For the year ending<br />
on March 31, 2005<br />
For the year ending<br />
on March 31, 2006<br />
For the year ending<br />
on March 31, 2007<br />
Total Revenue 11149.27 13,625.50 15,128.20<br />
Profit After Tax (2070.26) (2,432.51) (1,938.75)<br />
Equity Share <strong>Capital</strong> 8430.09 8,430.09 8,430.09<br />
Preference Share 0.00 300.00 300.00<br />
<strong>Capital</strong><br />
Reserves (excluding (9265.33) (8,404.26) (9,824.09)<br />
revaluation reserves)<br />
Net Worth (835.24) 325.83 1,094<br />
EPS per share of Rs. (2.46) (2.89) (2.30)<br />
10<br />
NAV per share of Rs.<br />
10<br />
(0.99) 0.39 (1.30)<br />
17. Hathway Investments Private Limited<br />
Brief History<br />
Hathway Investments Private Limited was incorporated on July 06, 1993 under the Companies Act, 1956,<br />
having its registered office situated at Rahejas, Corner of Main Avenue & V.P. Road, Santacruz (West),<br />
Mumbai-400054. The shares of Hathway Investments Private Limited are not listed on any stock exchanges in<br />
India<br />
Nature of Activities<br />
The company was incorporated with the main object of carrying out the activities of investing in securities.<br />
Board of Directors<br />
The Board of Directors of Hathway Investments Private Limited as on March 31, 2008, consists of<br />
Name<br />
Position<br />
Rajan Raheja<br />
Chairman<br />
Vinayak Aggarwal Managing Director<br />
Akshay Raheja<br />
Director<br />
A. Unnikrishnan Director<br />
Sanjay Johar<br />
Director<br />
92
Shareholding Pattern<br />
The shareholding pattern of this company as on March 31, 2008, is as under<br />
Category No. of Shares held Percentage of Holding<br />
Raheja Family 2,917030 29.17<br />
Bodies Corporate 7,082,970 70.83<br />
Total 10,000,000 100<br />
Financial Performance<br />
The financial performance of this company for last three years is as below<br />
Particulars For the year ending<br />
on March 31, 2005<br />
For the year ending<br />
on March 31, 2006<br />
For the year ending<br />
on March 31, 2007<br />
Total Revenue 542.72 145.49 301.30<br />
Profit After Tax 466.66 96.50 307.83<br />
Equity Share <strong>Capital</strong> 1000.00 1000.00 1000.00<br />
Reserves (excluding 13627.58 13724.08 14031.91<br />
revaluation reserves)<br />
Net Worth 16866.14 16962.64 17270.47<br />
EPS per share of Rs. 4.67 0.96 3.08<br />
100<br />
NAV per share of Rs. 168.66 169.63 172.70<br />
18. Outlook Publishing (I) Private Limited<br />
Brief History<br />
Outlook Publishing (I) Private Limited was incorporated on April 23, 1992 under name of Bandra Investments<br />
& Finance Private Limited and later on its name was changed with effect from September 11, 2000 to Bandra<br />
Contractors and Developers Private Limited which was then changed to Outlook Publishing (I) Private Limited,<br />
with effect from November 05, 2002 under the Companies Act, 1956 having its registered office situated at<br />
Rahejas, Corner of Main Avenue & V.P. Road, Santacruz (West), Mumbai-400 054. The shares of Outlook<br />
Publishing (I) Private Limited are not listed on any stock exchanges in India<br />
Nature of Activities<br />
The company was incorporated with the main object of carrying on the business in print media. The company is<br />
currently publishing magazines such as Outlook, Outlook Money, Outlook Traveller, Outlook Saptahik, Outlook<br />
Business, Outlook Profit, Marie Claire etc.<br />
Board of Directors<br />
The Board of Directors of Outlook Publishing (I) Pvt. Ltd. as on March 31, 2008, consists of<br />
Name<br />
Position<br />
Rajan Raheja<br />
Chairman<br />
Akshay Raheja<br />
Vice Chairman<br />
Suman Raheja<br />
Director<br />
Viren Rajan Raheja Director<br />
A. Unnikrishnan Director<br />
Gopal Narang<br />
Director<br />
Shareholding Pattern<br />
The shareholding pattern of this company as on March 31, 2008, is as under<br />
Category No. of Shares held Percentage of Holding<br />
Raheja Family 3,208,733 29.17<br />
Bodies Corporate 7,791,267 70.83<br />
Total 11,000,000 100<br />
93
Financial Performance<br />
The financial performance of this company for last three years is as below<br />
Particulars For the year ending<br />
on March 31, 2005<br />
For the year ending<br />
on March 31, 2006<br />
For the year ending<br />
on March 31, 2007<br />
Total Revenue 6137.79 6,733.22 8,782.76<br />
Profit After Tax 487.55 168.38 (314.62)<br />
Equity Share <strong>Capital</strong> 110.00 110.00 110.00<br />
Reserves (excluding (7228.62) (6,994.34) (7,327.62)<br />
revaluation reserves)<br />
Net Worth (7118.62) (6,884.34) (7,217.62)<br />
EPS per share of Rs. 1 4.43 1.53 (2.86)<br />
NAV per share of Rs. 1 (64.71) (62.58) (65.61)<br />
19. Matsyagandha Investments & Finance Private Limited<br />
Brief History<br />
Matsyagandha Investments & Finance Private Limited was incorporated on June 04, 1990, under the Companies<br />
Act, 1956, having its registered office situated at Rahejas, Corner of Main Avenue & V.P. Road Santacruz<br />
(West), Mumbai-400054. The shares of Matsyagandha Investments & Finance Private Limited are no listed on<br />
any stock exchange in India.<br />
Nature of Activities<br />
The company was incorporated with the main object carrying on the business as an investment and Finance<br />
Company including venture funding, seed capital funding, underwriters and dealing in securities.<br />
Board of Directors<br />
The Board of Directors of Matsyagandha Investments & Finance Private Limited as on March 31, 2008, consists<br />
of<br />
Name<br />
Rajan Raheja<br />
Suman Raheja<br />
Akshay Raheja<br />
Viren Rajan Raheja<br />
Position<br />
Director<br />
Director<br />
Director<br />
Director<br />
94
Shareholding Pattern<br />
The shareholding pattern of this company as on March 31, 2008, is as under<br />
Category No. of Shares held Percentage of Holding<br />
Raheja Family 5010 33.38<br />
Bodies Corporate 10,000 66.62<br />
Total 15,010 100<br />
Financial Performance<br />
The financial performance of this company for last three years is as below<br />
Particulars For the year ending<br />
on March 31, 2005<br />
For the year ending<br />
on March 31, 2006<br />
For the year ending<br />
on March 31, 2007<br />
Total Revenue 812.83 32.38 239.49<br />
Profit After Tax 218.07 17.97 (49.30)<br />
Equity Share <strong>Capital</strong> 15.01 15.01 15.01<br />
Reserves (excluding 3569.16 3587.14 3533.70<br />
revaluation reserves)<br />
Net Worth 3584.17 3602.15 3548.71<br />
EPS per share of Rs. 1452.86 119.73 (328.43)<br />
100<br />
NAV per share of Rs.<br />
100<br />
23878.58 23,998.31 23,642.30<br />
20. Brindaban Agro Industries Private Limited<br />
Brief History<br />
Brindaban Agro Industries Private Limited was incorporated on June 01, 1990, under the Companies Act, 1956,<br />
having its registered office situated at Rahejas, 4 th Floor, Corner of Main Avenue & V.P. Road, Santacruz<br />
(West), Mumbai-400054. The shares of Brindaban Agro Industries Private Limited are not listed on any stock<br />
exchange in India<br />
Nature of Activities<br />
The company was incorporated with the main object of carrying on activities of investing in securities.<br />
Board of Directors<br />
The Board of Directors of Brindaban Agro Industries Private Limited as on March 31, 2008, consists of<br />
Name<br />
Rajan Raheja<br />
Suman Raheja<br />
Akshay Raheja<br />
Aziz Parpia<br />
Viren Rajan Raheja<br />
Position<br />
Director<br />
Director<br />
Director<br />
Director<br />
Director<br />
Shareholding Pattern<br />
The shareholding pattern of this company as on March 31, 2008 is as under<br />
Category No. of Shares held Percentage of Holding<br />
Raheja Family 5,010 33.38<br />
Bodies Corporate 10,000 66.62<br />
Total 15,010 100<br />
Financial Performance<br />
The financial performance of this company for last three years is as below<br />
95
Particulars For the year ending<br />
on March 31, 2005<br />
For the year ending<br />
on March 31, 2006<br />
For the year ending<br />
on March 31, 2007<br />
Total Revenue 0.05 0.04 0.04<br />
Profit After Tax (0.07) (0.07) (0.08)<br />
Equity Share <strong>Capital</strong> 15.01 15.01 15.01<br />
Reserves (excluding 1.85 1.78 1.70<br />
revaluation reserves)<br />
Net Worth 16.86 16.79 16.71<br />
EPS per share of Rs. (0.48) (0.46) (0.52)<br />
100<br />
NAV per share of Rs.<br />
100<br />
112.30 111.84 111.32<br />
21. Peninsula Estates Private Limited<br />
Brief History<br />
Peninsula Estates Private Limited was incorporated on June 01, 1990 under the Companies Act, 1956, having its<br />
registered office situated at Rahejas, Corner of Main Avenue & V.P. Road, Santacruz (West), Mumbai-400054.<br />
The shares of Peninsula Estates Private Limited are not listed on any stock exchange in India.<br />
Nature of Activities<br />
The company was incorporated with the main object of carrying on construction and investment activities.<br />
Board of Directors<br />
The Board of Directors of Peninsula Estates Private Limited as on March 31, 2008 consists of<br />
Name<br />
Rajan B Raheja<br />
Suman Raheja<br />
Akshay Raheja<br />
Viren Rajan Raheja<br />
Position<br />
Director<br />
Director<br />
Director<br />
Director<br />
Shareholding Pattern<br />
The shareholding pattern of this company as on March 31, 2008<br />
Category No. of Shares held Percentage of Holding<br />
Raheja Family 5,010 33.38<br />
Bodies Corporate 10,000 66.62<br />
Total 15,010 100<br />
Financial Performance<br />
The financial performance of this company for last three years is as below<br />
Particulars For the year ending<br />
on March 31, 2005<br />
For the year ending<br />
on March 31, 2006<br />
For the year ending<br />
on March 31, 2007<br />
Total Revenue 186.40 5.26 63.28<br />
Profit After Tax 168.83 (11.32) 36.02<br />
Equity Share <strong>Capital</strong> 15.01 15.01 15.01<br />
Reserves (excluding 1940.01 1928.58 1964.51<br />
revaluation reserves)<br />
Net Worth 1955.02 1943.59 1979.52<br />
EPS per share of Rs. 1124.81 (75.41) 239.97<br />
100<br />
NAV per share of Rs.<br />
100<br />
13023.49 12948.62 13188.03<br />
22. Bayside Exports Private Limited<br />
96
Brief History<br />
Bay Side Exports Private Limited was incorporated on June 01, 1990 under the Companies Act, 1956, having its<br />
registered office situated at Rahejas, 4 th Floor, Corner of Main Avenue & V.P. Road, Santacruz (West),<br />
Mumbai-400054. The shares of Bayside Exports Private Limited are not listed on any stock exchange in India.<br />
Nature of Activities<br />
The company was incorporated with the main object of carrying on activities of investing in securities.<br />
Board of Directors<br />
The Board of Directors of Bayside Exports Private Limited as on March 31, 2008 consists of<br />
Name<br />
Rajan Raheja<br />
Suman Raheja<br />
Akshay Raheja<br />
Viren Rajan Raheja<br />
Aziz Parpia<br />
Position<br />
Director<br />
Director<br />
Director<br />
Director<br />
Director<br />
Shareholding Pattern<br />
The shareholding pattern of this company as on March 31, 2008 is as under<br />
Category No. of Shares held Percentage of Holding<br />
Raheja Family 5,010 33.38<br />
Bodies Corporate 10,000 66.62<br />
Total 15,100 100<br />
Financial Performance<br />
The financial performance of this company for last three years is as below<br />
Particulars For the year ending<br />
on March 31, 2006<br />
For the year ending<br />
on March 31, 2006<br />
For the year ending<br />
on March 31, 2007<br />
Total Revenue 0.04 0.04 0.09<br />
Profit After Tax (0.07) (0.07) (0.03)<br />
Equity Share <strong>Capital</strong> 15.01 15.01 15.01<br />
Reserves (excluding 1.85 1.77 1.74<br />
revaluation reserves)<br />
Net Worth 16.86 16.78 16.75<br />
EPS per share of Rs. (0.50) (0.48) (0.22)<br />
100<br />
NAV per share of Rs.<br />
100<br />
112.30 111.82 111.60<br />
97
23. R.B.R Construction Private Limited<br />
Brief History<br />
R.B.R Constructions Private Limited is incorporated on June 05, 1982, under the Companies Act, 1956 having<br />
its registered office situated at Rahejas, Corner of Main Avenue & V.P. Road, Santacruz (West) Mumbai-<br />
400054. The shares of R.B.R Construction Private Limited are not listed on any stock exchange in India.<br />
Nature of Activities<br />
The company was incorporated with the main object of carrying on investment activities.<br />
Board of Directors<br />
The Board of Directors of R.B.R. Construction Private Limited as on March 31, 2008, consists of<br />
Name<br />
Rajan Raheja<br />
Suman Raheja<br />
Akshay Raheja<br />
Viren Rajan Raheja<br />
Aziz Parpia<br />
Position<br />
Director<br />
Director<br />
Director<br />
Director<br />
Director<br />
Shareholding Pattern<br />
The shareholding pattern of this company as on March 31, 2008, is as under<br />
Category No. of Shares held Percentage of Holding<br />
Raheja Family 5,010 33.38<br />
Bodies Corporate 10,000 66.62<br />
Total 15,010 100<br />
Financial Performance<br />
The financial performance of this company for last three years is as below<br />
Particulars For the year ending<br />
on March 31, 2005<br />
For the year ending<br />
on March 31, 2006<br />
For the year ending<br />
on March 31, 2007<br />
Total Revenue 0.04 0.04 0.07<br />
Profit After Tax (0.08) (0.08) (0.06)<br />
Equity Share <strong>Capital</strong> 15.01 15.01 15.01<br />
Reserves (excluding 1.14 1.06 1.01<br />
revaluation reserves)<br />
Net Worth 16.15 16.07 16.02<br />
EPS per share of Rs. (0.54) (0.51) (0.38)<br />
100<br />
NAV per share of Rs.<br />
100<br />
107.60 107.09 106.70<br />
24. R. Raheja Properties Private Limited<br />
Brief History<br />
R. Raheja Properties Private Limited was incorporated on August 17, 1981 under the name of Gokul<br />
Construction Company Private Limited and later on its name was changed R Raheja Properties Private Limited<br />
with effect from January 04, 2008, under the Companies Act, 1956, having its registered office situated at<br />
Rahejas, Corner of Main Avenue & V.P. Road, Santacruz (West), Mumbai-400 054. The shares of R.Raheja<br />
Properties Private Limited are not listed on any stock exchanges in India.<br />
Nature of Activities<br />
98
The company was incorporated with the main object of carrying on construction and investment activities<br />
Board of Directors<br />
The Board of Directors of R.Raheja Properties Private Limited as on March 31, 2008<br />
Name<br />
Rajan Raheja<br />
Suman Raheja<br />
Akshay Raheja<br />
Viren Rajan Raheja<br />
Position<br />
Director<br />
Director<br />
Director<br />
Director<br />
Shareholding Pattern<br />
The shareholding pattern of this company as on March 31, 2008<br />
Category No. of Shares held Percentage of Holding<br />
Raheja Family 5010 33.38<br />
Bodies Corporate 10,000 66.62<br />
Total 15,010 100<br />
Financial Performance<br />
The financial performance of this company for last three years is as below<br />
Particulars For the year ending<br />
on March 31, 2005<br />
For the year ending<br />
on March 31, 2006<br />
For the year ending<br />
on March 31, 2007<br />
Total Revenue 5423.79 7521.55 2967.68<br />
Profit After Tax 1320.50 314.51 3.70<br />
Equity Share <strong>Capital</strong> 15.01 15.01 15.01<br />
Reserves (excluding 3455.44 3769.95 3725.00<br />
revaluation reserves)<br />
Net Worth 3470.45 3784.96 3740.01<br />
EPS per share of Rs. 8797.48 2095.32 24.68<br />
100<br />
NAV per share of Rs.<br />
100<br />
23,120.91 25,216.23 24,916.82<br />
25. Spur Cable and Datacom Private Limited<br />
Brief History<br />
Spur Cable and Datacom Private Limited was incorporated on May 06, 1994 under the name of Hathway<br />
Securities Private Limited and later on its name was changed to Spur Advertising Private Limited having effect<br />
from May 26, 1999 which was then changed to Spur Cable and Datacom Private Limited with effect from<br />
November 08, 1999, under the Companies Act, 1956, with its registered office situated at Rahejas, 4 th Floor,<br />
Corner of Main Avenue & V.P. Road, Santacruz (West), Mumbai-400 054. The shares of Spur Cable and<br />
Datacom Private Limited are not listed on any of the stock exchanges in India.<br />
99
Nature of Activities<br />
The company was incorporated with the main object of carrying on business of broking, investment,<br />
underwriters, advisors to public issues and advertising and publicity.<br />
Board of Directors<br />
The Board of Directors of Spur Cable and Datacom Private Limited as on March 31, 2008<br />
Name<br />
Position<br />
Rajan Raheja<br />
Director<br />
Suman Raheja<br />
Director<br />
Akshay Raheja<br />
Director<br />
Viren Rajan Raheja Director<br />
Vinayak Aggarwal Director<br />
Viyay Aggarwal<br />
Director<br />
K. Jayaraman Director<br />
Shareholding Pattern<br />
The shareholding pattern of this company as on March 31, 2008<br />
Category No. of Shares held Percentage of Holding<br />
R Raheja Properties Private Limited 200,000 20<br />
Peninsula Estates Private Limited 200,000 20<br />
Excelsior Construction Private Limited 200,000 20<br />
Gstaad Investment & Finance Private Limited 200,000 20<br />
Trophy Investment & Finance Private Limited 200,000 20<br />
Total 10,00,000 100<br />
Financial Performance<br />
The financial performance of this company for last three years is as below<br />
Particulars For the year ending<br />
on March 31, 2005<br />
For the year ending<br />
on March 31, 2006<br />
For the year ending<br />
on March 31, 2007<br />
Total Revenue 0.02 - -<br />
Profit After Tax (0.23) (0.22) (0.27)<br />
Equity Share <strong>Capital</strong> 100.00 100.00 100.00<br />
Reserves (excluding 498.52 498.29 498.03<br />
revaluation reserves)<br />
Net Worth 598.52 598.29 598.03<br />
EPS per share of Rs. (0.02) (0.02) (0.03)<br />
100<br />
NAV per share of Rs.<br />
100<br />
59.85 59.83 59.80<br />
26. Varahagiri Investment & Finance Private Limited<br />
Brief History<br />
Varahagiri Investment & Finance Private Limited was incorporated on May 31, 1990 under the Companies Act,<br />
1956, having its registered office situated at Rahejas, Corner of Main Avenue & V.P. Road, Santacruz (West),<br />
Mumbai-400 054. The shares of Varahagiri Investment & Finance Private Limited are not listed on any stock<br />
exchanges in India.<br />
100
Nature of Activities<br />
The company was incorporated with the main object carrying on the business as an Investment and Finance<br />
Company including venture funding, seed capital funding, underwriting and dealing in securities<br />
Board of Directors<br />
The Board of Directors of Varahagiri Investment & Finance Private Limited as on March 31, 2008<br />
Name<br />
Rajan Raheja<br />
Suman Raheja<br />
Akshay Raheja<br />
Viren Rajan Raheja<br />
Position<br />
Director<br />
Director<br />
Director<br />
Director<br />
Shareholding Pattern<br />
The shareholding pattern of this company as on March 31, 2008<br />
Category No. of Shares held Percentage of Holding<br />
Raheja Family 5010 33.38<br />
Bodies Corporate 10,000 66.62<br />
Total 15,010 100<br />
Financial Performance<br />
The financial performance of this company for last three years is as below<br />
Particulars For the year ending<br />
on March 31, 2005<br />
For the year ending<br />
on March 31, 2006<br />
For the year ending<br />
on March 31, 2007<br />
Total Revenue 545.21 14.91 33.56<br />
Profit After Tax 501.77 (3.80) 8.47<br />
Equity Share <strong>Capital</strong> 15.01 15.01 15.01<br />
Reserves (excluding 3748.22 3744.50 3752.97<br />
revaluation reserves)<br />
Net Worth 3763.23 3759.51 3767.98<br />
EPS per share of Rs. 3342.88 (25.34) 56.41<br />
100<br />
NAV per share of Rs. 25071.46 25046.73 25103.14<br />
27. Colonnade Housing Private Limited<br />
Brief History<br />
Colonnade Housing Private Limited was incorporated on June 1, 1990 under the Companies Act, 1956 having<br />
its registered office situated at Rahejas, Corner of Main Avenue & V.P. Road, Santacruz (West), Mumbai-400<br />
054. The shares of Colonnade Housing Private Limited are not listed on any of the stock exchanges in India<br />
Nature of Activities<br />
The company was incorporated with the main object of carrying on Real estate Development and Investment<br />
activities.<br />
Board of Directors<br />
The Board of Directors of Colonnade Housing Private Limited as on March 31, 2008<br />
101
Name<br />
Rajan Raheja<br />
Suman Raheja<br />
Akshay Raheja<br />
Viren Rajan Raheja<br />
Position<br />
Director<br />
Director<br />
Director<br />
Director<br />
Shareholding Pattern<br />
The shareholding pattern of this company as on March 31, 2008<br />
Category No. of Shares held Percentage of Holding<br />
Raheja Family 5010 33.38<br />
Bodies Corporate 10,000 66.62<br />
Total 15,010 100<br />
Financial Performance<br />
The financial performance of this company for last three years is as below<br />
Particulars For the year ending<br />
on March 31, 2005<br />
For the year ending<br />
on March 31, 2006<br />
For the year ending<br />
on March 31, 2007<br />
Total Revenue 0.05 0.05 0.12<br />
Profit After Tax (0.08) (0.07) (0.01)<br />
Equity Share <strong>Capital</strong> 15.01 15.01 15.01<br />
Reserves (excluding 6.26 6.17 6.28<br />
revaluation reserves)<br />
Net Worth 21.27 21.18 21.29<br />
EPS per share of Rs. (0.52) (0.46) (0.08)<br />
100<br />
NAV per share of Rs. 141.69 141.09 141.82<br />
28. Gstaad Trading Company Private Limited<br />
Brief History<br />
Gstaad Trading Company Private Limited was incorporated on July 24, 1986 under the Companies Act, 1956<br />
having itsregistered office situated at Rahejas, Corner of Main Avenue & V.P. Road, Santacruz (West), Mumbai<br />
-400 054. The shares of Gstaad Trading Company Private Limited are not listed on any stock exchanges in<br />
India.<br />
Nature of Activities<br />
The company was incorporated with the main object of carrying on business of exporters and importers and<br />
Investment activities.<br />
Board of Directors<br />
The Board of Directors of Gstaad Trading Company Private Limited as on March 31, 2008<br />
Name<br />
Rajan Raheja<br />
Suman Raheja<br />
Akshay Raheja<br />
Viren Rajan Raheja<br />
Position<br />
Director<br />
Director<br />
Director<br />
Director<br />
102
Shareholding Pattern<br />
The shareholding pattern of this company as on March 31, 2008<br />
Category No. of Shares held Percentage of Holding<br />
Raheja Family 5010 33.38<br />
Bodies Corporate 10,000 66.62<br />
Total 15,010 100<br />
Financial Performance<br />
The financial performance of this company for last three years is as below<br />
Particulars For the year ending<br />
on March 31, 2005<br />
For the year ending<br />
on March 31, 2006<br />
For the year ending<br />
on March 31, 2007<br />
Total Revenue 0.15 0.15 0.21<br />
Profit After Tax 0.02 0.03 0.08<br />
Equity Share <strong>Capital</strong> 15.01 15.01 15.01<br />
Reserves (excluding 6.50 6.51 6.73<br />
revaluation reserves)<br />
Net Worth 21.51 21.52 21.74<br />
EPS per share of Rs. 0.13 0.22 0.53<br />
100<br />
NAV per share of Rs. 143.29 143.37 144.81<br />
29. Brindaban Land Development Private Limited<br />
Brief History<br />
Brindaban Land Development Private Limited was incorporated on June 5, 1982 under the Companies Act,<br />
1956, having its registered office situated at Rahejas, Corner of Main Avenue & V.P. Road, Santacruz (West),<br />
Mumbai-400 054. The shares of Brindaban Land Development Private Limited are not listed on any of the stock<br />
exchanges in India.<br />
Nature of Activities<br />
The company was incorporated with the main object of carrying on real estate development and investment<br />
activities.<br />
Board of Directors<br />
The Board of Directors of Brindaban Land Development Private Limited as on March 31, 2008<br />
Name<br />
Rajan Raheja<br />
Suman Raheja<br />
Akshay Raheja<br />
Viren Rajan Raheja<br />
Position<br />
Director<br />
Director<br />
Director<br />
Director<br />
Shareholding Pattern<br />
The shareholding pattern of this company as on March 31, 2008<br />
Category No. of Shares held Percentage of Holding<br />
Raheja Family 5010 33.38<br />
Bodies Corporate 10,000 66.62<br />
Total 15,010 100<br />
Financial Performance<br />
The financial performance of this company for last three years is as below<br />
103
Particulars For the year ending<br />
on March 31, 2005<br />
For the year ending<br />
on March 31, 2006<br />
For the year ending<br />
on March 31, 2007<br />
Total Revenue 0.04 0.04 0.09<br />
Profit After Tax (0.09) (0.09) (0.03)<br />
Equity Share <strong>Capital</strong> 15.01 15.01 15.01<br />
Reserves (excluding 5.80 5.69 5.79<br />
revaluation reserves)<br />
Net Worth 20.81 20.70 20.80<br />
EPS per share of Rs. (0.63) (0.58) (0.22)<br />
100<br />
NAV per share of Rs. 138.61 137.91 138.57<br />
30. Optimix Technologies Private Limited<br />
Brief History<br />
Optimix Technologies Private Limited was incorporated on July 18, 2005 under the Companies Act, 1956<br />
having its registered office situated at Wockhardt Towers, West Wing, Level 2, Bandra Kurla Complex,<br />
Mumbai-400 051. The shares of Optimix Technologies Private Limited are not listed on any of the stock<br />
exchanges in India<br />
Nature of Activities<br />
The company was incorporated with the main object of carrying on the business of providing, selling and<br />
processing of Information Technology enabled services, design, develop all kinds of computer software<br />
systems, related to banks, mutual funds, Investment advisors, stock market intermediaries, and work relating to<br />
web site designing, web solutions, internet and e-commerce products and to provide value added services and<br />
computer consultancy services.<br />
Board of Directors<br />
The Board of Directors of Optimix Technologies Private Limited as on March 31, 2008<br />
Name<br />
Rajan Raheja<br />
Vineet K. Vohra<br />
Vinayak Aggarwal<br />
Rahmi Mehta<br />
Michael Ferreira<br />
Bhavin Mehta<br />
Position<br />
Chairman<br />
Managing Director<br />
Director<br />
Director<br />
Director<br />
Alternate Director to Mr. Rashmi Mehta<br />
Shareholding Pattern<br />
The shareholding pattern of this company as on March 31, 2008<br />
Category No. of Shares held Percentage of Holding<br />
ING Insurance International B.V. 27525854 42.50<br />
Kirti Equities Private Limited 11981843 18.50<br />
R. Raheja Properties Limited 25259022 39.00<br />
Other Individuals 3 0<br />
Total 64766722 100<br />
Financial Performance<br />
The financial performance of this company for last two years is as below<br />
Particulars<br />
For the year ending on<br />
March 31, 2006<br />
For the year ending on<br />
March 31, 2007<br />
Total Revenue 64.76 312.54<br />
Profit After Tax (424.38) (1920.27)<br />
Equity Share <strong>Capital</strong> 640.76 6476.67<br />
Reserves (excluding<br />
(424.38) (2344.65)<br />
revaluation reserves)<br />
104
Net Worth 216.29 4132.02<br />
EPS per share of Rs. 100 (9.79) (18.04)<br />
NAV per share of Rs. 100 3.38 6.38<br />
31. H & R Johnson (India) Limited<br />
Brief History<br />
H & R Johnson (India) Limited was incorporated on January 25, 1958, under the Companies Act, 1956 having<br />
its registered office situated at Windsor 7 th Floor, C.S.T. Road, Santacruz (East), Mumbai-400 098. The shares<br />
of H&R Johnson (India) Limited are not listed on any stock exchanges in India.<br />
Nature of Activities<br />
The company was incorporated with the main object of carrying on business of manufacture of Ceramic Glazed<br />
Tiles, Sanitary-ware and other allied products and services.<br />
Board of Directors<br />
The Board of Directors of H&R Johnson (India) Limited as on March 31, 2008<br />
Name<br />
Rajan Raheja<br />
Suman Raheja<br />
Akshay Raheja<br />
Aziz Parpia<br />
Rajesh Kapadia<br />
Joseph Mathews<br />
Vijay Aggarwal<br />
Position<br />
Chairman<br />
Director<br />
Director<br />
Director<br />
Director<br />
Director<br />
Managing Director<br />
Shareholding Pattern<br />
The shareholding pattern of this company as on March 31, 2008<br />
Category No. of Shares held Percentage of Holding<br />
Raheja Family 2376 0.16<br />
Bodies Corporate controlled by Raheja Family 12,36,669 81.33<br />
Other Bodies Corporate 2,81,534 18.52<br />
Total 1520579 100<br />
Financial Performance<br />
The financial performance of this company for last three years is as below<br />
Particulars For the year ending<br />
on March 31, 2005<br />
For the year ending<br />
on March 31, 2006<br />
For the year ending<br />
on March 31, 2007<br />
Total Revenue 52665.14 71,628.35 90,914.52<br />
Profit After Tax 2975.19 1674.31 1006.58<br />
Equity Share <strong>Capital</strong> 1267.15 1267.15 1267.15<br />
Reserves (excluding 15590.70 17,242.01 18,227.40<br />
revaluation reserves)<br />
Net Worth 16330.87 18,180.22 19,279.67<br />
EPS per share of Rs. 234.15 131.46 78.93<br />
100<br />
NAV per share of Rs.<br />
100<br />
1288.79 1434.73 1521.50<br />
32. Innovassynth Technologies (India) Limited<br />
Brief History<br />
105
Innovassynth Technologies (India) Limited was incorporated on December 4, 2001 under the Companies Act,<br />
1956, with its registered office situated at 3 rd Floor, Paragon Condominium, P.B. Marg, Worli, Mumbai-400013.<br />
The shares of Innovassynth Technologies (India) Limited are not listed on any of the stock exchanges in India.<br />
Nature of Activities<br />
The company was incorporated with the object of carrying business as manufacturers, processors and dealers of<br />
specialty chemicals, fine chemicals, custom synthesis of all kinds and descriptions and to act as manufacturers<br />
of and dealers in intermediate, by-products and end products ad to carry on business of toll manufacturing and<br />
contract manufacturing of chemicals, all kinds and descriptions, as well as to do marketing and research and<br />
development of aforesaid products.<br />
Board of Directors<br />
The Board of Directors of Innovassynth Technologies (India) Limited as on March 31, 2008 consists of<br />
Name<br />
Mr. Shyam Bhupatirai<br />
Ghia<br />
Mr. Rajan Raheja<br />
Mr<br />
Rakesh<br />
Jhunjhunwla<br />
Mr. Rakesh Kapadia<br />
Mr. ShyamSunder Sami<br />
Mr. B.K. Kulkarni<br />
Mr. S.C. Nanda<br />
Dr. B. Sahu<br />
Position<br />
Director<br />
Director<br />
Director<br />
Director<br />
Director<br />
Whole-time Functional Director, Designated as Director-R&D,<br />
Business Development<br />
Whole-time Functional Director, Designated as Director-Finance,<br />
Supply Chain & Works<br />
C.E.O & Director<br />
Shareholding Pattern<br />
The shareholding pattern of this company as on March 31, 2008 is as under<br />
Category No. of Shares held Percentage of Holding<br />
Promoter & Promoter Group 2,83,68,911 51.08<br />
Bodies Corporate 31,280 0.05<br />
Trusts 20,00,000 3.60<br />
Directors and Relatives 31,50,000 5.67<br />
NRIs 2,11,36,236 38.05<br />
Individuals 8,57,276 1.55<br />
Total 5,55,43,703 100<br />
Financial Performance<br />
The financial performance of this company for last three years is as below: -<br />
106
Particulars For the year ending<br />
on March 31, 2005<br />
For the year ending<br />
on March 31, 2006<br />
For the year ending<br />
on March 31, 2007<br />
Total Revenue 1915.95 1924.12 2440.84<br />
Profit After Tax (647.23) (1241.92) (971.28)<br />
Equity Share <strong>Capital</strong> 2505.01 3905.51 4904.37<br />
Reserves (exclusion 21.31 2122.06 2122.06<br />
revaluation reserves)<br />
Net Worth 2526.32 6027.57 7026.43<br />
EPS per share of Rs. (2.58) (3.18) (1.98)<br />
10<br />
NAV per share of Rs.<br />
10<br />
10.09 15.43 14.33<br />
Details of Partnership Firms constituting Our Promoter Group<br />
33. Manali Investments<br />
Brief History<br />
Manali Investments was formed on March 05, 1992, under the Indian Partnership Act, 1932 having its principal<br />
situated at Rahejas, Corner of Main Avenue & V.P. Road, Santacruz (West), Mumbai<br />
Nature of Activities<br />
This partnership firm was formed with the main object of carrying on investment activity.<br />
Names of the Partners as on March 31, 2008<br />
Name % Holding Position<br />
Manali Investments & Finance Private Limited 25.00 Partner<br />
Bloomingdale Investments & Finance Private Limited 25.00 Partner<br />
Coronet Investments Private Limited 25.00 Partner<br />
Peninsula Estates Private Limited 5.00 Partner<br />
Varahagiri Investments & Finance Private Limited 5.00 Partner<br />
Rajan Raheja 10.00 Partner<br />
Matsyagandha Investments &Finance Private Limited 5.00 Partner<br />
Financial Performance<br />
The financial performance of this partnership firm for last three years is as below: -<br />
Particulars<br />
Total<br />
Revenue<br />
Profit After<br />
Tax<br />
Partners<br />
<strong>Capital</strong><br />
For the year ending on<br />
March 31, 2005<br />
For the year ending on<br />
March 31, 2006<br />
For the year ending on<br />
March 31, 2007<br />
146.95 0.22 2.15<br />
93.00 44.84 0.88<br />
4.22 41.06 (4.06)<br />
34. Peninsula Developers<br />
Brief History<br />
Peninsula Developers was formed on September 28, 1992, under the Indian Partnership Act, 1932 having its<br />
principal office situated at Rahejas, Corner of Main Avenue & V.P. Road, Santacruz (West), Mumbai-400054.<br />
Nature of Activities<br />
This partnership firm was formed with the main object of carrying on construction activity.<br />
Names of the Partners as on March 31, 2008<br />
107
Name % Holding Position<br />
Peninsula Estates Private Limited 25.00 Partner<br />
Coronet Investments Private Limited 25.00 Partner<br />
Bloomingdale Investment & Finance Private Limited 25.00 Partner<br />
Matsyagandha Investment & Finance Private Limited 25.00 Partner<br />
Financial Performance<br />
The financial performance of this partnership firm for last three years is as below: -<br />
Particulars<br />
Total<br />
Revenue<br />
Profit After<br />
Tax<br />
Partners<br />
<strong>Capital</strong><br />
For the year ending on<br />
March 31, 2005<br />
For the year ending on<br />
March 31, 2006<br />
For the year ending on<br />
March 31, 2007<br />
250.00 0.00 0.07<br />
4.55 (0.63) 1.78<br />
504.28 509.15 515.44<br />
35. R & S Business Centre<br />
Brief History<br />
R & S Business Centre was formed on December 01, 1997, under the Indian Partnership Act, 1932 having its<br />
principal office situated at Rahejas, Corner of Main Avenue & V.P. Road, Santacruz (West), Mumbai 400054.<br />
Nature of Activities<br />
This partnership firm was formed with the main object of carrying on business support activities.<br />
Names of the Partners as on March 31, 2008<br />
Name % Holding Position<br />
R. Raheja Properties Private Limited 14.00 Partner<br />
Varahagiri Investment & Finance Private Limited 15.00 Partner<br />
Bloomingdale Investment & Finance Private Limited 8.00 Partner<br />
Matsyagandha Investment & Finance Private Limited 7.00 Partner<br />
Manali Investment & Finance Private Limited 8.00 Partner<br />
Coronet Investments & Private Limited 7.00 Partner<br />
Shalini Construction Co. Private Limited 11.00 Partner<br />
Peninsula Estates Private Limited 15.00 Partner<br />
Excelsior Construction Private Limited 8.00 Partner<br />
Shalini Developers Private Limited 7.00 Partner<br />
Financial Performance<br />
The financial performance of this partnership firm for last three years is as below: -<br />
Particulars<br />
Total<br />
Revenue<br />
Profit After<br />
Tax<br />
Partners<br />
<strong>Capital</strong><br />
For the year ending on<br />
March 31, 2005<br />
For the year ending on<br />
March 31, 2006<br />
For the year ending on<br />
March 31, 2007<br />
25.20 25.20 25.20<br />
13.70 14.68 14.27<br />
40.97 35.66 24.92<br />
Companies having negative networth<br />
Except for the following, none of the companies being our Promoter Group entities have incurred losses in the<br />
last three financial years or has a negative net worth:<br />
108
1. Brahmasonic Sound Production Private Limited;<br />
2. Chika Overseas Private Limited;<br />
3. Crescent Property Developers Private Limited;<br />
4. Sea Side Exports Private Limited;<br />
5. Prerna Builders Private Limited;<br />
6. Asianet Satellite Communications Limited;<br />
7. Outlook Publishing (I) Private Limited;<br />
8. Matsyagandha Investments & Finance Private Limited<br />
9. Brindaban Agro Industries Private Limited<br />
10. Peninsula Estates Private Limited<br />
11. Bayside Exports Private Limited<br />
12. R.B.R Construction Private Limited<br />
13. Spur Cable & Datacom Private Limited<br />
14. Colonnade Housing Private Limited<br />
15. Varahagiri Investment & Finance Private Limited<br />
16. Optimix Technologies Private Limited<br />
17. Brindaban Land Development Private Limited<br />
None of the above are sick companies within the meaning of Sick Industrial Companies (Special Provisions)<br />
Act, 1985.<br />
Companies under winding up<br />
None of the companies forming a part of our Promoter Group Entities are under winding up.<br />
Disassociation by our Promoters<br />
There are no companies/firms/ventures with which our promoters have disassociated themselvesduring the last<br />
three years<br />
Common Pursuits<br />
Our Promoters are not currently engaged in the areas in which our Company operates through any other person<br />
or entity other than our Company, and therefore there are no common pursuits as on date of the Draft Letter of<br />
Offer.<br />
Related Party Transactions<br />
For details on our related party transactions with our Promoter Group Entities, please refer to the chapter titled<br />
“Related Party Transactions” beginning on page 109 of the Draft Letter of Offer.<br />
109
RELATED PARTY TRANSACTIONS<br />
Save and except as stated otherwise in the chapters titled “Business Overview” and “Our Management” and<br />
“Financial Statements” beginning on page 31, 60 and 111, respectively, of the Draft Letter of Offer, there have<br />
been no sales or purchases between our Company, our Promoters and our Promoter Group Entities exceeding<br />
the aggregate value of 10% of the total sales or purchases of our Company.<br />
For further details of our related party transactions, please refer to the section titled “Financial<br />
Statements” beginning on page 111 of the Draft Letter of Offer.<br />
110
DIVIDEND POLICY<br />
Dividends, other than interim dividends, will be declared at the annual general meeting of the shareholders<br />
based on the recommendation of the Board of Directors. Our Company does not have any specific dividend<br />
policy. The Board may, at its discretion, recommend dividends to be paid to our shareholders. Generally, the<br />
factors that may be considered by the Board of Directors before making any recommendations for the dividend<br />
include, without limitation, our future expansion plans and capital requirements, profits earned during the fiscal<br />
year, cost of raising funds from alternate sources, liquidity position, applicable taxes including tax on dividend,<br />
as well as exemptions under tax laws available to various categories of investors from time to time and general<br />
market conditions.<br />
We have not declared any dividends in the last five years.<br />
111
SECTION V – FINANCIAL STATEMENTS<br />
AUDITORS’ REPORT<br />
The Board of Directors<br />
Futura Polyesters Limited,<br />
Paragon Condominium,<br />
P.B. Marg,<br />
Mumbai - 400 013<br />
Dear Sirs,<br />
We have examined the Books of account of Futura Polyesters Limited, for the five financial years ended 31 st<br />
March 2008, and its wholly owned subsidiary company Innovassynth Investments Limited being the last date<br />
upto which the accounts of the Companies, have been made up and audited by us for presentation to the<br />
members.<br />
In terms of requirements of:<br />
(A) Paragraph B (1) of the part II schedule II of the Companies Act 1956<br />
(B) The Securities & Exchange Board of India (Disclosure and Investor Protection) Guidelines 2000 Issued<br />
by SEBI on 19 th January 2000 in pursuance of section 11 of SEBI Act, 1992 "the SEBI Guidelines"<br />
and,<br />
(C) The instruction dated 1 st June 2008, received from the Company, requesting us to issue report as<br />
Statutory Auditor of the Company, relating to the offer document in connection with the Right Issue<br />
offer of Equity Shares by the Company.<br />
We report as under:<br />
In our opinion, the financial information of the Company, setout in reports, read with respective significant<br />
accounting policies, subject to notes given thereon, have been prepared in accordance with part II –B of the<br />
Schedule II of the Companies Act, 1956 and the SEBI Guidelines.<br />
We have examined the following financial information relating to the company prepared by the management for<br />
the purpose of inclusion in the Offer document.<br />
a) Futura Polyesters Limited<br />
1. Summary statement of Fixed Assets and Liabilities as per Annexure I<br />
2. Statement of Profit and Losses as per Annexure II<br />
3. Significant Accounting Policies as per Annexure III<br />
4. Dividend declared by the Company as per Annexure IV<br />
5. Other Income as per Annexure V<br />
6. Accounting Ratios as per Annexure VI<br />
7. <strong>Capital</strong>isation statement as per Annexure VII<br />
8. Secured Loans- Term Loans as per Annexure VIIIA<br />
9. Secured Loans – Working <strong>Capital</strong> as per Annexure VIIIB<br />
10. Secured Loans – Others as per Annexure VIIIC<br />
11. Tax Shelter Statement as per Annexure IX<br />
12. Unsecured Loans as per Annexure X<br />
13. Schedule of Investments as per Annexure XI<br />
14. Sundry Debtors as per Annexure XII<br />
15. Loans and Advances as per Annexure XIII<br />
16. Statement of <strong>Capital</strong> Commitments and Contingent Liabilities as per Annexure XIV<br />
17. Related Parties as per Annexure XV<br />
18. Related Parties Transactions as per Annexure XV - A,B and C<br />
19. Cash Flow Statement as per Annexure XVI<br />
20. Note on Consolidation of Accounts of Subsidiary as per Annexure XVII<br />
b) Innovassynth Investments Limited<br />
112
1. Balance Sheet as per Annexure XVIII<br />
2. Significant Accounting Policies as per Annexure XIX<br />
3. Cash Flow Statement as per Annexure XX<br />
Consolidated accounts have not been prepared since the Company’s Subsidiary Innovassynth Investments<br />
Limited is covered by Clause 11 (a) of Accounting Standard 21 issued by the Institute of Chartered Accountants<br />
of India.<br />
This report is being provided solely for the use of Company for the purpose of inclusion of the said offer<br />
document in connection with Right Issue offer of the Equity Shares of the Company.<br />
This report may not be used or relied upon by, or disclosed, referred to or communicated by yourself (in whole<br />
or in part) to, any third party for any purpose other than the stated use, except with our written consent in each<br />
instance, and which consent, may be given, only after full consideration of the circumstances at that time.<br />
For N.M. Raiji and Co,<br />
Chartered Accountants<br />
Y.N. Thakkar<br />
Dated: 10 th June 2008<br />
Partner<br />
Place: Mumbai MembershipNo. 33329<br />
113
FINANCIAL INFORMATION<br />
A) <strong>FUTURA</strong> <strong>POLYESTERS</strong> <strong>LIMITED</strong><br />
SUMMARY STATEMENT OF FIXED ASSETS AND LIABILITIES<br />
Annexure - I<br />
Sr.<br />
No<br />
Particulars<br />
As at<br />
(Rupees in Lacs)<br />
31-Mar-08 31-Mar-07 31-Mar-06 31-Mar-05 31-Mar-04<br />
1 FIXED ASSETS<br />
Gross Block 59,885.68 43,437.40 41,637.34 40,134.39 39,530.90<br />
Less: Depreciation 25,997.55 23,776.81 21,438.63 19,071.16 16,698.29<br />
Net Block 33,888.13 19,660.59 20,198.71 21,063.23 22,832.61<br />
Add: <strong>Capital</strong> Work - in - Progress 2,581.05 976.24 674.50 463.03 127.69<br />
Less: Revaluation Reserve 14,293.43 1,087.64 1,995.37 2,905.50 3,833.36<br />
Net Block after adjustment for<br />
Revaluation Reserve 22,175.75 19,549.19 18,877.84 18,620.76 19,126.94<br />
2 INVESTMENTS 2,621.11 2,381.22 2,378.91 2,578.91 2,583.67<br />
3 DEFERRED TAX ASSETS (NET) 74.57 541.19 975.13 1,115.87 1,486.20<br />
4<br />
CURRENT ASSETS, LOANS AND<br />
ADVANCES<br />
Inventories 11,825.74 8,320.37 9,484.56 7,568.29 5,188.71<br />
Sundry Debtors 3,742.01 3,647.75 2,464.08 4,230.74 2,534.73<br />
Cash and Bank Balances 1,824.15 1,734.06 1,947.84 1,514.78 4,364.45<br />
Loans and Advances 2,651.44 2,760.63 2,525.71 1,767.76 2,225.11<br />
20,043.34 16,462.81 16,422.19 15,081.57 14,313.00<br />
LIABILITIES AND PROVISIONS:<br />
5 SECURED LOANS 11,585.42 10,604.11 10,474.00 9,734.59 10,541.62<br />
6 UNSECURED LOANS 4,327.35 4,437.61 4,662.89 5,452.95 4,507.62<br />
7<br />
CURRENT LIABILITIES AND<br />
PROVISIONS<br />
Current Liabilities 14,971.69 11,096.21 11,902.68 10,900.22 13,186.00<br />
Provisions 877.99 775.36 709.31 638.27 625.50<br />
15,849.68 11,871.57 12,611.99 11,538.49 13,811.50<br />
NET WORTH (1+2+3+4-5-6-7) 13,152.32 12,021.12 10,905.19 10,671.08 8,649.07<br />
NET WORTH REPRESENTED BY<br />
8 SHARE CAPITAL 5,242.17 5,242.17 5,242.17 4,835.59 3,347.71<br />
9 RESERVE AND SURPLUS 22,213.93 7,880.36 7,725.56 8,962.07 9,529.49<br />
Less: Revaluation Reserve 14,293.43 1,087.64 1,995.37 2,905.50 3,833.36<br />
Less: Miscellaneous Expenditure 10.35 13.77 67.17 221.08 394.77<br />
Reserves (Net of Revaluation<br />
Reserves) 7,910.15 6,778.95 5,663.02 5,835.49 5,301.36<br />
NET WORTH (8+9) 13,152.32 12,021.12 10,905.19 10,671.08 8,649.07<br />
114
STATEMENT OF PROFIT & LOSSES<br />
Annexure - II<br />
(Rupees in lacs)<br />
Particulars<br />
For the year ending 31 st March<br />
2007-08<br />
2006-07<br />
2005-06<br />
2004-05 2003-04<br />
INCOME<br />
Sales and Services (Gross)<br />
Manufacture 44,814.30 56,146.50 52,138.73 52,175.54 45,090.96<br />
Traded - - - - 114.27<br />
Less: - Excise Duty 4,464.34 4,621.98 5,023.54 4,956.42 4,341.82<br />
Services 1,012.80 181.90 - 174.72 124.81<br />
41,362.76 51,706.42 47,115.19 47,393.84 40,988.22<br />
Other Income 1,295.89 520.17 487.99 587.72 610.98<br />
(Less)/Add: (Increase)/Decrease in<br />
Inventories (1,078.40) 829.70 (1,420.22) (1,482.90) 1,660.85<br />
43,737.05 51,396.89 49,023.40 49,464.46 39,938.35<br />
EXPENDITURE<br />
Raw Material Consumed 23,590.41 29,400.62 29,802.01 28,881.78 23,200.74<br />
Staff Costs 1,690.89 2,009.97 1,990.54 1,833.13 1,982.94<br />
Other Manufacturing Expenses 10,055.20 11,822.37 11,372.38 11,001.91 10,325.83<br />
Administration Expenses 1,265.81 1,111.74 1,083.47 1,092.17 1,247.95<br />
Selling and Distribution Expenses 1,479.22 1,946.43 2,198.18 2,345.33 2,370.26<br />
Purchase of Traded Items - - - - 170.48<br />
Interest 2,126.66 1,764.13 1,890.76 1,917.19 2,411.58<br />
Depreciation 2,577.57 2,478.71 2,391.90 2,410.31 2,188.33<br />
Less:- Transfer from Revaluation Reserve (884.15) (907.73) (910.15) (937.42) (311.76)<br />
41,901.61 49,626.24 49,819.09 48,544.40 43,586.35<br />
Net Profit /(Loss) before Tax and<br />
Extraordinary items 1,835.44 1,770.65 (795.69) 920.06 (3,648.00)<br />
Add: Profit on sale of Chemical Business<br />
Less: Voluntary Retirement Scheme<br />
- - - - 1,626.97<br />
8.39 25.39 57.75 86.39 264.62<br />
Less: Deferred VRS Gratuity Payment<br />
- 31.51 100.61 100.61 100.61<br />
Profit / (Loss) after extra ordinary items<br />
but before tax 1,827.05 1,713.75 (954.05) 733.06 (2,386.26)<br />
Less: Provision for Tax 203.83 192.28 - - -<br />
Less: Provision for Wealth Tax 2.00 2.00 2.00 2.29 2.50<br />
Less: Provision for Fringe Benefit Tax<br />
28.00 23.00 43.00 - -<br />
Add: Deferred Tax adjustment<br />
(466.61) (433.94) (140.74) (370.33) 2,188.15<br />
Less: Excess Provision of Earlier Years<br />
(1.17) - - - -<br />
Net Profit /(Loss) after Tax 1,127.78 1,062.53 (1,139.79) 360.44 (200.61)<br />
Balance brought forward 1,064.57 2.04 1,141.83 781.39 982.00<br />
BALANCE CARRIED TO BALANCE<br />
SHEET 2,192.35 1,064.57 2.04 1,141.83 781.39<br />
115
Notes Forming Part of the Accounts<br />
Annexure – III<br />
1. SIGNIFICANT ACCOUNTING POLICIES<br />
A. System of Accounting<br />
The financial statements are prepared under Historical cost convention on an accrual basis except for<br />
certain fixed assets, which have been revalued.<br />
B. Fixed Assets and Depreciation<br />
I. Fixed Assets<br />
Fibre, Resin and Preforms Divisions.<br />
Fixed Assets are stated at cost less depreciation. Cost comprises of Cost of acquisition, cost of<br />
improvements and any attributable cost of bringing the asset to condition for its intended use. Interest<br />
on loans taken for the procurement of specific assets accrued upto the date of acquisition/ installation of<br />
the said assets is capitalised along with the cost of the assets.<br />
II. Depreciation<br />
Fibre Division:<br />
Depreciation has been provided on Plant and Machinery and Research and development facilities on<br />
straight line basis and on other assets on written down value basis at the rates specified in Schedule<br />
XIV of the Companies Act, 1956 as amended from time to time. Certain Plants have been treated<br />
continuous process Plants based on technical and other evaluation. However, higher rate of<br />
depreciation has been provided on certain Plant and Machinery ranging from 6.75% -12.50% compared<br />
to 5.28% of Schedule XIV rate, based on technical evaluation. The total accumulated depreciation is<br />
restricted up to 95% of the Gross Block Value.<br />
Resin and Preforms Divisions:<br />
Depreciation has been provided on all assets on straight line basis at the rates specified in Schedule<br />
XIV of the Companies Act, 1956 as amended from time to time. However, higher rate of depreciation<br />
has been provided on certain Plant and Machinery ranging from 6.75%-12.50% compared to 5.28% of<br />
Schedule XIV rate, based on technical evaluation. The total accumulated Depreciation is restricted up<br />
to 95% of the Gross Block Value.<br />
C. Investments<br />
116
Investments are classified into current and long term investments. Current investments are stated at the<br />
lower of cost and fair value, Long term investments are stated at cost. A provision for diminution is<br />
made to recognise a decline, other than temporary, in value of long term investments.<br />
Income on Investments:<br />
Dividend income is accounted when right to receive payment is established. Interest income is<br />
accounted on accrual basis.<br />
D. Inventories<br />
Inventories are valued as under:<br />
(i) Fibre Division and Chemical Division<br />
Raw materials, packing materials, stores and spares: at Cost (Weighted average method) Materials-intransit<br />
and semi finished goods: at Cost. (Weighted average method)<br />
Finished goods: at lower of cost or net realisable value. (Weighted average method)<br />
Traded items: at lower of cost or net realisable value. (Weighted average method)<br />
(ii) Resin and Preforms Divisions:<br />
Raw materials: At Cost (FIFO)<br />
Semi finished Goods: At Cost (FIFO)<br />
Finished goods: At lower of cost or net realisable value (Cost FIFO Basis)<br />
Stores, Spares and Packing Materials: At Cost (FIFO).<br />
E. Sales and Services<br />
Sale of goods is recognised on despatch to customers. Sales include amounts recovered towards excise<br />
duty, but exclude amounts recovered towards sales tax. Service income is recognised as per terms of<br />
agreements.<br />
F. Export Incentives<br />
Export Incentives are accounted on an accrual basis.<br />
G. Foreign Currency Transactions<br />
Transactions in foreign currencies are recorded at current rates except transactions covered by forward<br />
contracts. Assets and Liabilities denominated in foreign currency are restated at the year end rates. All<br />
exchange gains and losses except those relating to acquisition of fixed assets which are adjusted to the<br />
carrying cost of such assets, are accounted for in the Profit and Loss Account.<br />
H. Research and Development<br />
Revenue expenditure on research and development is charged as an expense in the year in which they<br />
are incurred. <strong>Capital</strong> expenditure is shown as an addition to Fixed Assets.<br />
New Product Development Expenditure<br />
Expenditure incurred on development of new products are amortised over a period of 10 years.<br />
I. Employee Benefits<br />
(i) Defined Contribution Plan<br />
Company’s contributions paid /payable during the year to Superannuation Fund, ESIC and Labour<br />
Welfare Fund are recognized in the Profit and Loss Account. There are no other obligations other than<br />
the contribution payable to the respective trust / Fund. Company’s Contribution towards<br />
Superannuation and ESIC is based on a percentage of salary which is made to an approved fund.<br />
117
(ii) Defined Benefit Plan<br />
Company’s Contribution towards Provident Fund is based on a percentage of salary which is made to<br />
an approved fund.<br />
Company’s Contribution towards Gratuity is made to an approved fund as per actuarial valuation<br />
certificate obtained from an actuary which is determined using projected unit credit method.<br />
(iii) Short term compensated absences are provided as per actuarial valuation certificate obtained from<br />
an actuary which is determined using projected unit credit method.<br />
(iv) Long term employee benefit<br />
Long term compensated absences are provided as per actuarial valuation certificate obtained from an<br />
actuary which is determined using projected unit credit method.<br />
(v) Actuarial gains / losses are immediately taken to profit and loss account and are not deferred.<br />
J. Deferred Revenue Expenses:<br />
Voluntary Retirement Scheme related payments are amortised over a period of 5 years<br />
K. Taxes on Income<br />
(a) Current Tax: Provision for Income Tax is determined in accordance with the provision of Income<br />
Tax Act, 1961.<br />
(b) Deferred Tax Provision: Deferred tax is recognised on timing differences between the accounting<br />
income and the taxable income for the year and quantified using the tax rates and laws enacted or<br />
subsequently enacted on the Balance Sheet date. Deferred tax assets are recognised and carried<br />
forward to the extent that there is a reasonable certainty that sufficient future taxable income will<br />
be available against which such deferred tax assets can be realised.<br />
118
DIVIDEND DECLARED BY THE COMPANY<br />
IV<br />
Annexure -<br />
Details<br />
(Rupees in Lacs)<br />
Dividend for the year ended<br />
31-Mar-<br />
08<br />
31-Mar-<br />
07<br />
31-Mar-<br />
06<br />
31-Mar-<br />
05<br />
31- Mar-<br />
04<br />
Dividend for the year NIL NIL NIL NIL NIL<br />
119
OTHER INCOME<br />
V<br />
Annexure –<br />
(Rupees in Lacs)<br />
Particulars<br />
For the year ending 31 st March<br />
2007-08 2006-07 2005-06 2004-05 2003-04<br />
Dividend on Investments:<br />
From Subsidiary Company -<br />
Others 3.35 1.00 0.07 3.85 0.36<br />
Interest Others (Gross) 269.22 3.80 6.62 327.57 30.88<br />
Profit on sale of Fixed Assets (Net) 638.45 33.47 - 0.83 3.44<br />
Profit on sale of Investments - 20.00 8.00 -<br />
Provision for Doubtful Debts/ Advances Written Back - - - 7.18<br />
Provision no longer required written back 2.37 68.77 112.18 106.21 248.22<br />
Sales Tax Set-off - - 6.91 19.70<br />
Miscellaneous Income: 187.61 308.57 286.73 76.57 113.63<br />
Prior Period Adjustments 0.14 25.83 - - -<br />
Foreign Exchange Fluctuation (Net) 194.51 70.76 61.79 1.20 14.66<br />
Sundry Credit Balances written back 0.24 7.97 0.60 56.58 172.91<br />
1,295.89 520.17 487.99 587.72 610.98<br />
120
ACCOUNTING RATIOS<br />
Annexure – VI<br />
Details<br />
As at the year ending 31 st<br />
Mar-08 Mar-07 Mar-06 Mar-05 Mar-04<br />
Earning Per Share (in Rs.) (Basic) 2.17 2.14 (1.89) (1.81) 0.49<br />
Earning Per Share (in Rs.) (Diluted) 2.17 2.14 (1.89) (1.76) 0.49<br />
Net Asset Value Per Share (Rs.) 25.09 22.93 20.80 22.07 25.84<br />
Return on Net Worth (RONW) 8.57% 8.84% -10.45% 3.38% -2.32%<br />
Definition of Ratios:<br />
Earnings Per Share (EPS) =<br />
Net Asset Value =<br />
Return on Net Worth =<br />
Net Profit After Tax / No. of Equity Shares<br />
Net worth (excluding Revaluation Reserve & Miscellaneous<br />
expenditure to the extent not written off) / No. of Equity Shares<br />
Net Profit after Tax / Net worth (excluding Revaluation Reserve &<br />
Miscellaneous expenditure to the extent not written off)<br />
Earnings Per Share (EPS) =<br />
Net Asset Value =<br />
Return on Net Worth =<br />
Net Profit After Tax / No. of Equity Shares<br />
Net worth (excluding Revaluation Reserve & Miscellaneous<br />
expenditure to the extent not written off) / No. of Equity Shares<br />
Net Profit after Tax / Net worth ( excluding Revaluation Reserve<br />
& Miscellaneous expenditure to the extent not written off)<br />
121
CAPITALISATION STATEMENT AS ON 31.03.2008<br />
Annexure – VII<br />
(Rupees in Lacs)<br />
Sr. No<br />
Details<br />
Pre-issue as<br />
on 31-03-2008<br />
Post Issue<br />
1 Secured Loan 11,585.42 11,585.42<br />
2 Unsecured Loan 4,327.35 4,327.35<br />
3 Total Debt 15,912.77 15,912.77<br />
4 Less: Short Term Debts 6,642.04 6,642.04<br />
5 Total Long Term Debts 9,270.73 9,270.73<br />
Share Holders Funds<br />
6 Share <strong>Capital</strong> 5,242.17 7,863.26<br />
7 Reserves (Excluding Revaluation Reserve) 7,920.50 7,920.50<br />
Miscellaneous Expenditure (not written off) (10.35) (10.35)<br />
8 Total Share holders Fund 13,152.32 15,773.41<br />
Long Term Debt/Equity (5/8) 0.70 0.59<br />
122
SECURED LOANS - TERM LOANS AS ON 31ST MARCH, 2008<br />
VIIIA<br />
Annexure –<br />
Sr.<br />
No<br />
Name of the Institution<br />
/ Bank<br />
TERM LOANS<br />
1 Industrial Development<br />
Bank of India Limited<br />
2 Industrial Development<br />
Bank of India Limited<br />
Sanctioned<br />
Amount<br />
Outstanding<br />
amount as<br />
on 31-03-2008<br />
Rate of<br />
Interest<br />
Security<br />
(Rupees in lacs)<br />
Repayment<br />
Schedule<br />
4,000.00 1,850.00 11.00% First Pari Passu charge and 6 Quarterly<br />
mortgage of all immovable Installments of<br />
properties situate at Manali, Tamil Rs.275 Lacs each<br />
Nadu first charge by way of from 1st April,2008<br />
hypothecation on Company's to 1st July,2009. 1<br />
movables including machinery Installment of<br />
spares and accessories (excluding Rs.200 Lacs on 1st<br />
book debts) subject to prior charges October,2009.<br />
created in favour of other lenders.<br />
2,000.00 1,354.00 11.00% First Pari Passu charge and 5 Quarterly<br />
mortgage of all immovable Installments of<br />
properties situate at Manali, Tamil Rs.124 Lacs each<br />
Nadu first charge by way of from 1st April,2008<br />
hypothecation on Company's to 1st April,2009. 2<br />
movables including machinery Quarterly<br />
spares and accessories (excluding Installments of<br />
book debts) subject to prior charges Rs.248 Lacs each<br />
created in favour of other lenders. from 1st July,2009<br />
and 1st October,2009.<br />
1 Installment of<br />
Rs.238 Lacs on 1st<br />
January,2010.<br />
3 Axis Bank Limited 2,000.00 1,250.00 BPLR - 2<br />
.50%<br />
4 Canara Bank 1,250.00 1,117.50 BPLR -<br />
1.00%<br />
5 Yes Bank Ltd. 2,000.00 2,000.00 BPLR -<br />
0.25%<br />
* Bank Prime lending Rate<br />
First Pari Passu charge and 10 Quarterly<br />
mortgage of all immovable Installments of<br />
properties situate at Manali, Tamil Rs.125 Lacs each<br />
Nadu first charge by way of from April,2008 to<br />
hypothecation on Company's July,2010.<br />
movables including machinery<br />
spares and accessories (excluding<br />
book debts) subject to prior charges<br />
created in favour of other lenders.<br />
Exclusive Charge on the 16 Quarterly<br />
machineries acquired, to be Installment of<br />
acquired out of this Loan. Rs.78.13 Lacs each<br />
from October, 2008<br />
to July, 2012.<br />
First Pari Passu charge and 16 Quarterly<br />
mortgage of all immovable Installments of<br />
properties situate at Manali, Tamil Rs.125 Lacs each<br />
Nadu first charge by way of from August,2008 to<br />
hypothecation on Company's May,2012.<br />
movables including machinery<br />
spares and accessories (excluding<br />
book debts) subject to prior charges<br />
created in favour of other lenders.<br />
123
Sr.<br />
No<br />
SECURED LOANS - WORKING CAPITAL AS ON 31ST MARCH, 2008<br />
Name of the Institution / Bank<br />
Sanctioned<br />
Amount<br />
Outstanding<br />
amount as on<br />
31-03-2008<br />
Rate of Interest<br />
Annexure – VIIIB<br />
(Rupees in Lacs)<br />
Security<br />
WORKING CAPITAL LOANS<br />
Cash Credit / Working <strong>Capital</strong><br />
Demand Loan, Packing Credit and<br />
facilities from Banks<br />
1 Bank of India 1,208.00 1,104.52 BPLR + 1.50 % * Hypothecation of the Company’s entire<br />
Stock of Raw Materials, Finished Goods,<br />
Stocks in Process, Consumable Stores and<br />
Spares at Company’s factory and book<br />
debts on pari passu basis; second charge on<br />
movable and immovable properties at<br />
Manali, Chennai, Tamil Nadu of the<br />
Company<br />
2 State Bank of India 1,600.00 1,539.36 SBAR+ 0.75 % ** ------------- same as above ------------------<br />
3 Indian Bank 250.00 152.10 BPLR + 4.00 % * ------------- same as above ------------------<br />
4 UCO Bank 635.00 632.95 BPLR + 0.50 % * ------------- same as above ------------------<br />
5 Union Bank of India 307.00 313.19 BPLR + 3.50 % * ------------- same as above ------------------<br />
6 State Bank of Hyderabad 200.00 198.60 BPLR + 1.5 % * ------------- same as above ------------------<br />
7 Canara Bank 300.00 - BPLR - 0.25 % * ------------- same as above ------------------<br />
Total 4,500.00 3,940.72<br />
* Bank Prime lending Rate<br />
** State Bank of India Bench Mark Prime Lending Rate<br />
124
SECURED LOANS OTHERS ON 31ST MARCH, 2008<br />
Annexure – VIIIC<br />
Sr.<br />
No<br />
Name of the Institution / Bank<br />
Sanctioned<br />
Amount<br />
Outstanding<br />
amount as on<br />
31-03-08<br />
(Rupees in Lacs)<br />
Rate of Interest Security Repayment Schedule<br />
OTHER LOANS<br />
1 Citi Bank N.A. / HDFC Bank Ltd. 113.42 73.20 10% to 12% Secured by Specific Repayable by 31st March<br />
Assets taken on Hire '09 Rs. 39.77<br />
Purchase basis. Repayable by 31st March<br />
'10 Rs. 32.33<br />
Repayable by 31st March<br />
‘11 Rs.1.10<br />
73.20<br />
125
TAX SHELTER STATEMENT<br />
Annexure – IX<br />
(Rupees in Lacs)<br />
Particulars 2004 2005 2006 2007 2008<br />
Profit / (Loss) as<br />
(2386.26) 733.06 (954.04) 1713.75 1827.05<br />
per Profit and<br />
Loss account (A)<br />
Tax at Notional - 268.24 - 576.85 621.01<br />
Rate<br />
Add: Difference (145.52) (181.13) 481.21 268.15 116.55<br />
between tax<br />
depreciation and<br />
book depreciation<br />
Add: VRS claim 180.95 (0.60) - - -<br />
u/s.35DD (Net)<br />
Add: 43 B (226.64) 17.78 170.16 67.32 (48.56)<br />
disallowance<br />
(Net)<br />
Add: Others 97.93 1148.43 108.55 170.70 59.41<br />
(Net)<br />
Net Additions<br />
(93.28) 984.88 759.92 506.17 127.40<br />
(B)<br />
Tax Savings (34.13) 360.39 255.79 170.38 43.30<br />
Business Profit /<br />
(2479.54) 1717.94 (194.13) 2219.92 1954.45<br />
(Loss) for tax<br />
purpose (A+B) =<br />
(C)<br />
Carry forward<br />
(7855.93) (10335.47) (8617.53) (8811.66) (6591.75)<br />
Loss as per return<br />
(D)<br />
Cumulative carry<br />
forward Loss<br />
(C + D) = (E)<br />
(10,335.47) (8617.53) (8811.66) (6591.75) (4637.30)<br />
126
UNSECURED LOANS AS ON 31ST MARCH, 2008<br />
Sr.<br />
Amount<br />
Name of the Institution / Bank<br />
No<br />
Outstanding<br />
Rate of Interest<br />
Repayment Schedule<br />
1 Fixed Deposits from Public, 477.06 9% to 11% Payable by March, 2009 Rs.240.26 Lacs<br />
Shareholders, Employees<br />
Payable by March, 2010 Rs.138.01 Lacs<br />
Payable by March, 2011 Rs. 98.79 Lacs<br />
2 Fixed Deposits from Director 17.00 11.00% Payable on 11th June, 2008<br />
Fixed Deposits from Directors 6.00 12.00% Payable at Call<br />
Fixed Deposits from - Ex Director 750.00 12.00% Payable at Call<br />
Interest accrued & due on Ex Director 689.29 12.00% Payable at Call<br />
3 Short Term Deposits<br />
1,800.00 14.50% Repayable by 31.03.2009<br />
88.00 9% to 10% Repayable at call<br />
33.00 9% to 15% Repayable by April,2008<br />
230.00 13% to 15% Repayable by May,2008<br />
237.00 13% to 15% Repayable by June,2008<br />
Total 4,327.35<br />
Annexure – X<br />
(Rupees in Lacs)<br />
127
SCHEDULE OF INVESTMENTS AS ON 31.03.2008<br />
Description<br />
Face<br />
Value<br />
Per Unit<br />
Holdings<br />
Numbers<br />
As at<br />
31.03.2008<br />
Holdings<br />
Numbers<br />
As at<br />
31.03.2007<br />
Holdings<br />
Numbers<br />
As at<br />
31.03.2006<br />
Holdings<br />
Numbers<br />
As at<br />
31.03.2005<br />
Annexure – XI<br />
(Rupees in Lacs)<br />
Holdings<br />
Numbers<br />
As at<br />
31.03.2004<br />
LONG TERM (At Cost)<br />
Fully Paid<br />
QUOTED<br />
Non Trade:<br />
Equity Shares<br />
The Arvind Mills Limited Rs.10 18,241 72.97 18,241 72.97 18,241 72.97 18,241 72.97 18,241 72.97<br />
Less: Provision for<br />
60.20 60.20 60.20 60.20 60.20<br />
Diminution in the value of<br />
Investments<br />
12.77 12.77 12.77 12.77 12.77<br />
Bank of India Rs.10 7,200 3.24 7,200 3.24 7,200 3.24 7,200 3.24 7,200 3.24<br />
UNQUOTED<br />
6.75 % Tax Free US 64<br />
Bonds **<br />
Equity Shares<br />
The Pen Urban Cooperative<br />
Bank Limited<br />
The Shamrao Vithal Cooperative<br />
Bank Limited<br />
Innovassynth Technologies<br />
(India) Limited<br />
Arkay<br />
Energy<br />
(Rameshwaram) Limited<br />
In Foreign Holdings:<br />
Offshore Digital Services,<br />
Inc., California<br />
In subsidiary<br />
Innovassynth Investments<br />
Limited<br />
Futura Polyesters Inc USA<br />
Rs.100 57,345 57.34 57,345 57.34 57,345 57.34 57,345 57.34 57,345 57.34<br />
Rs.250 - - 120 0.30 1,200 0.30 1,200 0.30 1,200 0.30<br />
Rs.25<br />
Rs.25 1,015 0.25 1,015 0.25 1,015 0.25 1,015 0.25 1,015 0.25<br />
Rs.10 23,850,070 2,385.01 23,050,070 2,305.01 23,050,070 2,305.01 25,050,070 2,505.01 25,050,070 2,505.01<br />
Rs.10 1,575,000 157.50 - - - -<br />
- - - - 15,000 4.76<br />
Rs.10 50,000 5.00 - - - -<br />
$ 1 - 5,000 2.31 - - -<br />
2,621.11 2,381.22 2,378.91 2,578.91 2,583.67<br />
128
SUNDRY DEBTORS<br />
Annexure - XII<br />
(Rupees in Lacs)<br />
Particulars 31-Mar-08 31-Mar-07 31-Mar-06 31-Mar-05 31-Mar-04<br />
Over Six months<br />
Considered Good 752.14 713.65 434.76 366.50 140.12<br />
Considered Doubtful 514.52 582.00 438.96 428.31 428.51<br />
1,266.66 1,295.65 873.72 794.81 568.63<br />
Others: Considered Good 2,989.87 2,934.10 2,029.32 3,864.24 2,394.61<br />
4,256.53 4,229.75 2,903.04 4,659.05 2,963.24<br />
Less: Provision for doubtful debts 514.52 582.00 438.96 428.31 428.51<br />
3,742.01 3,647.75 2,464.08 4,230.74 2,534.73<br />
Sundry Debtors<br />
As at<br />
31-Mar-08 31-Mar-07 31-Mar-06 31-Mar-05 31-Mar-04<br />
Secured 207.11 634.39 73.81 161.03 247.74<br />
Unsecured 4,049.42 3,595.36 2,829.23 4,498.02 2,715.50<br />
4,256.53 4,229.75 2,903.04 4,659.05 2,963.24<br />
129
LOANS AND ADVANCE<br />
Annexure - XIII<br />
(Rupees in Lacs)<br />
Particulars 31-Mar-08 31-Mar-07 31-Mar-06 31-Mar-05 31-Mar-04<br />
Advances recoverable in Cash or in kind or for<br />
value to be received:<br />
Due from Subsidiary - - - - 552.53<br />
Considered good 2,345.43 2,342.64 2,122.46 1,268.02 1,201.29<br />
Considered doubtful 156.96 175.60 175.63 179.12 141.67<br />
2,502.39 2,518.24 2,298.09 1,447.14 1,342.96<br />
Less : Provision for Doubtful Advances 156.96 175.60 175.63 179.12 141.67<br />
2,345.43 2,342.64 2,122.46 1,268.02 1,201.29<br />
Advance Payment of Tax (Net of Provisions) - 130.59 101.49 195.85 246.47<br />
Balance with Excise, Customs, etc. 306.01 287.40 301.76 303.89 224.82<br />
2,651.44 2,760.63 2,525.71 1,767.76 2,225.11<br />
130
STATEMENT OF CAPITAL COMMITMENT AND CONTINGENT LIABILITIES<br />
Annexure - XIV<br />
CAPITAL COMMITMENTS<br />
Sr.<br />
No<br />
2007-08 2006-07 2005-06 2004-05 2003-04<br />
1. Estimated amount of contracts remaining to be<br />
executed on capital account (net of advance paid)<br />
and not provided for<br />
219.21 1194.07 44.17 143.62 185.52<br />
CONTINGENT LIABILITIES<br />
(Rupees in Lacs)<br />
Sr.<br />
No<br />
2007-08 2006-07 2005-06 2004-05 2003-04<br />
1. (i) Regarding Income Tax on account of disputes<br />
- 766.38 674.70 123.11 143.14<br />
raised by the Income Tax Department under the<br />
Income Tax Act 1961, there are decisions of<br />
Appellate Authorities in the case of other assesses,<br />
which appears to sustain most of the contentions of<br />
the Company on disputed points.<br />
(ii) Claims against the Company not acknowledged as 173.40 173.40 763.43 557.16 1,239.31<br />
debts.<br />
(iii) Service Tax - Penalty and interest demanded on 486.00 486.00 486.00 486.00 -<br />
technology transfer agreement between FPL and<br />
IOCL and vice versa. ST demand on goods transport<br />
service at Supreme Court.<br />
Service Tax demand on Goods Transport Agency 6.29 6.29 6.29 6.29 -<br />
during the Year 1997-98, departments' appeals<br />
pending in Supreme Court.<br />
Service Tax credit denial on outward freight and 63.84 - - - -<br />
canteen services 2005-06, 2006-07 and 2007-08.<br />
(iv) Central Excise - Claims against the company on 493.49 493.49 478.17 33.88 -<br />
various issues pending at CESTAT / High Court /<br />
Supreme Court.<br />
(v) Custom : Method of calculation of duty under 126.33 126.33 129.11 197.82 -<br />
notification 2 / 95 & other valuation issues.<br />
Custom duty on outstanding export obligations<br />
- - 17.49 30.15 59.22<br />
under DEEC license.<br />
(vi) Sales Tax on Input use for Exports (1999-2000 and 9.00 9.00 9.00 9.00 -<br />
2000-2001).<br />
(vii) Sales Tax on Interest collected (1997-98 & 2000-<br />
4.40 4.40 4.40 4.40 -<br />
2001) CST levied on Interest charges collected from<br />
customers.<br />
(viii) Guarantee given by the Company. 2,813.00 3,113.00 313.00 300.00 -<br />
131
RELATED PARTY TRANSACTION<br />
Annexure – XV<br />
2007-08<br />
Related Party Transactions:<br />
1 Relationships<br />
a) Subsidiary Companies<br />
1. Innovassynth Investments Limited<br />
b) Associates<br />
c) Key Management Personnel<br />
1. Mr. S. B. Ghia Chairman & Managing Director<br />
2. Mr. M. D. Dalal Joint Managing Director<br />
d) Companies in which Key Management Personnel have Significant Influence<br />
1. Innovassynth Technologies (India) Limited Mr. S. B. Ghia is a Common Director<br />
2. Sonata Software Limited Mr.S.B.Ghia , Mr.M.D.Dalal & Mr.Rajan Raheja are common<br />
Directors<br />
3. Sonata Information Tech.Limited Subsidiary of Sonata Software Limited<br />
4. Distributors (Bombay) Private Limited Significant influence of Mr.S.B.Ghia<br />
5. Viraj Investments Pvt Ltd Significant influence of Mr.S.B.Ghia<br />
6. Bhupati Investments & Finance Private Limited Subsidiary of Viraj Investments Private Limited<br />
7. Chika Private Limited Subsidiary of Bhupati Investments & Finance Private Limited<br />
8. Brahamasonic Sound Production Private Limited Subsidiary of Bhupati Investments & Finance Private Limited<br />
9. Kika Investments & Finance Private Limited Subsidiary of Bhupati Investments & Finance Private Limited<br />
10. Kharsundi Chemicals Pvt Ltd Subsidiary of Bhupati Investments & Finance Private Limited<br />
2006-07<br />
Related Party Transactions:<br />
1. Relationships<br />
a) Subsidiary Companies<br />
1. Futura Polyesters Inc.<br />
b) Associates<br />
1. Innovassynth Technologies (India) Limited<br />
c) Key Management Personnel<br />
1. Mr. S. B. Ghia Chairman & Managing Director<br />
2. Mr. M. D. Dalal Joint Managing Director<br />
d) Companies in which Key Management Personnel have Significant Influence<br />
1. Sonata Software Limited<br />
Mr.S.B.Ghia, Mr.M.D.Dalal and Mr.Rajan Raheja are common Directors<br />
2. Sonata Information Tech.Limited Subsidiary of Sonata Software Limited<br />
3. Distributors (Bombay) Private Limited Significant influence of Mr.S.B.Ghia<br />
4. Viraj Investments Pvt Ltd Significant influence of Mr.S.B.Ghia<br />
5. Bhupati Investments & Finance Private Limited Subsidiary of Viraj Investments Private Limited<br />
6. Chika Private Limited Subsidiary of Bhupati Investments & Finance Private Limited<br />
7. Brahamasonic Sound Production Private Limited Subsidiary of Bhupati Investments & Finance Private Limited<br />
8. Kika Investments & Finance Private Limited Subsidiary of Bhupati Investments & Finance Private Limited<br />
2005-06<br />
Related Party Transactions:<br />
1. Relationships<br />
a) Subsidiary Companies<br />
1. Futura Polyesters Inc.<br />
2. Innovassynth Technologies (India) Limited<br />
b) Key Management Personnel<br />
132
1. Mr. S. B. Ghia Chairman & Managing Director<br />
2. Mr. M. D. Dalal Joint Managing Director<br />
c) Companies in which Key Management Personnel have Significant Influence<br />
1. Sonata Software Limited Mr.S.B.Ghia, Mr.M.D.Dalal and Mr.Rajan Raheja are<br />
common Directors<br />
2. Sonata Information Tech.Limited Subsidiary of Sonata Software Limited<br />
3. Chika Private Limited Mr.S.B.Ghia , Mr. N.S. Ghia are common Directors<br />
4. Bhupati Investments & Finance Private Limited Significant Influence (through Viraj Investments Private Limited)<br />
Spouse, Mrs.R.S.Ghia and Mrs.V.D.Ghia are Directors<br />
5. Distributors (Bombay) Private Limited Significant influence of Mr.S.B.Ghia<br />
d) Relative of Key Management Personnel<br />
1. Mr. N.S.Ghia Son of Mr. S.B.Ghia<br />
2004-05<br />
Related Party Transactions:<br />
1. Relationships<br />
a) Subsidiary Companies<br />
1. Innovassynth Technologies (India) Limited<br />
b) Key Management Personnel<br />
1. Mr. S. B. Ghia Chairman & Managing Director<br />
2. Mr. M. D. Dalal Joint Managing Director<br />
e) Companies in which Key Management Personnel have Significant Influence<br />
1. Sonata Software Limited Mr.S.B.Ghia, Mr.M.D.Dalal and Mr.Rajan Raheja are<br />
common Directors<br />
2. Sonata Information Tech.Limited Subsidiary of Sonata Software Limited<br />
3. Chika Private Limited Mr.S.B.Ghia , Mr. N.S. Ghia are common Directors<br />
4. Bhupati Investments & Finance Private Limited Significant Influence (through Viraj Investments Private Limited<br />
Spouse, Mrs.R.S.Ghia and Mrs.V.D.Ghia are Directors<br />
2003-04<br />
Related Party Transactions:<br />
1. Relationships<br />
A) Subsidiary Companies<br />
1. Innovassynth Technologies (India) Limited<br />
b) Key Management Personnel<br />
1. Mr. S. B. Ghia Chairman & Managing Director<br />
2. Mr. M. D. Dalal Joint Managing Director<br />
3. Mr. M. N. Tumbe Joint Managing Director and C.E.O<br />
f) Companies in which Key Management Personnel have Significant Influence<br />
1. Sonata Software Limited Mr.S.B.Ghia, Mr.M.D.Dalal and Mr.Rajan Raheja are common<br />
Directors<br />
2. Sonata Information Tech. Limited Subsidiary of Sonata Software Limited<br />
3. Chika Private Limited Mr.S.B.Ghia , Mr. N.S. Ghia are common Directors<br />
4. Kharsundi Chemicals Private Limited Mr. M. N. Tumbe is a common Director<br />
5. Bhupati Investments & Finance Private Limited Significant Influence (through Viraj Investments Private Limited)<br />
Spouse, Mrs.R.S.Ghia and Mrs.V.D.Ghia are Directors<br />
133
Particulars<br />
STATEMENT OF CASH FLOWS<br />
Annexure - XVI<br />
(Rupees in lacs)<br />
For the year ending 31 st March<br />
(A) CASH FLOW FROM OPERATIONS<br />
Net Profit before tax and extra-ordinary item<br />
2007-08 2006-07 2005-06<br />
2004-05 2003-04<br />
1,835.44 1,770.65 (795.69) 920.06 (3,648.00)<br />
Adjustment for<br />
Depreciation 1,693.42 1,570.98 1,481.75 1,472.89 1,876.57<br />
Foreign Exchange Fluctuation (Net) (194.51) (70.76) (61.79) (1.20) (14.66)<br />
Interest / Dividend Income (272.57) (4.80) (6.69) (331.42) -<br />
Interest Expenses 2,126.66 1,764.13 1,890.76 1,917.19 2,411.58<br />
Profit / (Loss) on Sale of Fixed Assets (638.45) (33.47) 3.58 (0.83) 307.33<br />
Profit / (Loss) on Sale of Investments - - (20.00) (8.00) 23.17<br />
Diminution in Value of Investments - - - - 14.59<br />
Provision for Doubtful Debts / Advances 59.41 165.13 23.36 76.49 85.63<br />
Provision for Doubtful Debts / Advances Written - back - - - - (190.28)<br />
Provision no longer required written back (2.37) (68.77) (112.18) (106.21) (43.61)<br />
Credit balances written back (0.24) (7.97) (0.60) (56.58) (172.91)<br />
Provision for Investments Written - back - - - - (21.51)<br />
Operating Profit before working capital changes 4,606.79 5,085.12 2,402.50 3,882.39 627.90<br />
Adjustment for<br />
Trade and Other Receivables (175.07) (1,554.62) 891.00 (1,365.76) 662.36<br />
Inventories (3,505.37) 1,164.19 (1,916.27) (2,379.58) 2,098.72<br />
Trade Payables 4,207.17 (537.18) 1,270.59 (2,655.61) 2,542.99<br />
526.73 (927.61) 245.32 (6,400.95) 5,304.07<br />
Cash generated from operations 5,133.52 4,157.51 2,647.82 (2,518.56) 5,931.97<br />
Direct Taxes (Paid) (102.07) (246.38) 49.36 48.33 (42.73)<br />
Cash flow before extra-ordinary item 5,031.45 3,911.13 2,697.18 (2,470.23) 5,889.24<br />
Extra Ordinary Item (4.97) (3.50) (4.45) (13.31) (16.54)<br />
NET CASH FROM OPERATING ACTIVITIES 5,026.48 3,907.63 2,692.73 (2,483.54) 5,872.70<br />
(B) CASH FLOW FROM INVESTING ACTIVITIES:<br />
Purchase of Fixed Assets (4,669.13) (2,591.14) (1,762.27) (975.55) (579.70)<br />
Disposal of Fixed Assets 987.61 382.28 19.85 9.68 4,839.04<br />
Sale / Purchase of Investments (239.89) (2.31) 220.00 12.76 (2,499.96)<br />
Interest Received 269.22 3.80 6.62 327.57 -<br />
Dividend Received 3.35 1.00 0.07 3.85 0.36<br />
(3,648.84) (2,206.37) (1,515.73) (621.69) 1,759.74<br />
Net cash used in investing activities (3,648.84) (2,206.37) (1,515.73) (621.69) 1,759.74<br />
(C) CASH FLOW FROM FINANCING ACTIVITIES<br />
Proceeds from Issue of Share <strong>Capital</strong> - - 1,219.99 1,487.88 -<br />
Share Application Money - - - 725.02 -<br />
Proceeds from Long Term borrowings 981.31 130.11 884.84 (503.41) (2,930.46)<br />
Repayment from Short Term borrowings (249.02) (227.89) (812.90) 797.89 (207.62)<br />
Interest paid (2,019.84) (1,817.26) (2,035.87) (2,251.82) (2,145.47)<br />
(1,287.55) (1,915.04) (743.94) 255.56 (5,283.55)<br />
Net increase in cash and cash activities (A + B + C)<br />
90.09 (213.78) 433.06 (2,849.67) 2,348.89<br />
Cash and cash equivalents (Opening Balance) 1,734.06 1,947.84 1,514.78 4,364.45 2,015.56<br />
Cash and cash equivalents (Closing Balance) 1,824.15 1,734.06 1,947.84 1,514.78 4,364.45<br />
NET INCREASE / (DECREASE) AS DISCLOSED ABOVE 90.09 (213.78) 433.06 (2,849.67) 2,348.89<br />
134
NOTE ON CONSOLIDATION OF ACCOUNTS OF SUBSIDIARY<br />
XVII<br />
Annexure<br />
Consolidated accounts have not been prepared since the Company’s Subsidiary Innovassynth<br />
Investments Limited is covered by Clause 11 (a) of Accounting Standard 21 issued by the Institute of<br />
Chartered Accountants of India.<br />
135
B) INNOVASSYNTH INVESTMENTS <strong>LIMITED</strong><br />
STATEMENT OF ASSETS AND LIABILITIES FOR YEAR ENDED MARCH 31, 2008<br />
(Rupees in Lacs)<br />
Particulars<br />
31st March,<br />
2008<br />
Fixed Assets<br />
Gross Block -<br />
Less: Depreciation -<br />
Net Block -<br />
Total (A) -<br />
Investments (B) -<br />
Current Assets, Loans & Advances<br />
Inventory -<br />
Sundry Debtors -<br />
Cash and Bank Balances 2.29<br />
Loans and Advances -<br />
Total (C) 2.29<br />
Total Assets (A+B+C) = D 2.29<br />
Liabilities and Provisions<br />
Current Liabilities -<br />
Provisions -<br />
Secured Loans -<br />
Unsecured Loans -<br />
Deferred Tax (Asset)/Liabilities (net) -<br />
Total (E) -<br />
Net Worth (D-E) 2.29<br />
Net Worth represented by<br />
Equity Share <strong>Capital</strong> 5.00<br />
Reserve and Surplus<br />
Securities Premium Account -<br />
Profit & Loss account -<br />
Sub-Total -<br />
Less: Miscellaneous Expenditure (to the extent not written off or<br />
adjusted) 2.71<br />
Net Worth 2.29<br />
Annexure XVIII<br />
136
Significant accounting policies: -<br />
Annexure XIX<br />
a. System of Accounting:<br />
The Financial statements are prepared under historical cost convention on an accrual concept in<br />
accordance with the applicable Accounting Standards.<br />
b. Miscellaneous Expenditure<br />
Preliminary Expenses will be amortized from the Commencement of the Business.<br />
137
CASH FLOW STATEMENT FOR THE PERIOD FEBRUARY 15, 2008 TO MARCH 31, 2008<br />
Annexure XX<br />
(Rupees in Lacs)<br />
Particulars 31 st March, 2008<br />
Cash flows from Operating Activities<br />
Net Cash from Operating Activities (A) -<br />
Cash flows from Investing Activities<br />
Preliminary Expenses (2.71)<br />
Net cash from Investing Activities (B) (2.71)<br />
Cash flows from Financing Activities<br />
Proceeds from Issue of Share <strong>Capital</strong> 5.00<br />
Net cash used from Financing Activities (C ) 5.00<br />
Net increase in Cash and Cash Equivalents (A+B+C) 2.23<br />
Cash and cash equivalents as on February 15, 2008 (Opening Balance) -<br />
Cash and cash equivalents as on March 31, 2008 (Closing Balance) 2.29<br />
Net Increase / Decrease as disclosed above 2.29<br />
138
MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF<br />
OPERATIONS<br />
You should read the following discussion of our financial condition and results of operations together with our<br />
audited financial statements for the fiscal years ended March 31, 2004, 2005,2006,2007, 2008 and including the<br />
significant accounting policies and notes thereto and reports thereon which appear elsewhere in the Draft<br />
Letter of Offer. These financial statements have been prepared in accordance with Indian GAAP, the Companies<br />
Act and as required under the SEBI DIP Guidelines.<br />
Unless indicated otherwise, the financial data in this section is derived from our financial statements prepared<br />
in accordance with Indian GAAP and included in the draft Letter of Offer. The following discussion is also<br />
based on internally prepared statistical information and publicly available information. You are also advised to<br />
read the section titled “Risk Factors” beginning on page viii of the Draft Letter of Offer, which discusses a<br />
number of factors and contingencies that could affect our financial condition, results of operations and cash<br />
flows.<br />
Our fiscal year ends on March 31of each year. All references to a particular fiscal year are therefore to the 12-<br />
month ending March 31 of that year. Please refer to the chapter titled “Definitions and Abbreviations”<br />
beginning on page i of the Draft Letter of Offer to refer to certain industry, technical and financial terms with<br />
initials capitalised in this section.<br />
Overview of the business of our Company<br />
Our Company was incorporated as a public limited company in Maharashtra under the name Indian Organic<br />
Chemicals Limited in February 1960 and commenced business on April 22, 1960. We commenced<br />
manufacturing operations at our plant at Khopoli, Maharashtra, for production of alcohol-based chemicals like<br />
Acetic Acid, Acetic Anhydride, Acetaldehyde and Ethyl Acetate, Benzyl products, Plasticizers and Glyoxal.<br />
In 1972, we set up a plant at Manali, Chennai, for manufacture of Polyester Fibres with an installed capacity of<br />
6,100 MT per annum. By 1986, the capacity was expanded to 38,500 MT per annum. Subsequently, a 9,175 MT<br />
of Polyester Filament Yarn (POY) plant was also set up. The POY business was discontinued after 1995 due to<br />
its uneconomic size and the plant had since been disposed off.<br />
With the launching of petro-based chemicals in 1990s and liberalization of molasses usage for potable alcohol,<br />
our industrial alcohol-based facility at Khopoli lost its competitive edge. The chemicals business had to be<br />
phased out gradually over a period of time. We however, succeeded in adapting and using our facilities at<br />
Khopoli to undertake knowledge based activities like custom synthesis, contract manufacture and contract R&D.<br />
In India skilled manpower like scientists, chemists and engineers are easily available at competitive rates. As the<br />
new activity is “knowledge based” requiring a different focus, our Company decided to transfer the Chemicals<br />
division at Khopoli to another entity called Innovassynth Technologies (India) Limited. The term “knowledge<br />
based” means any activity, which requires use of specialised knowledge of the employees. Innovassynth<br />
Technologies (India) Limited is engaged in Customs Synthesis, Contract manufacture and Contract R&D work<br />
which requires specialised knowledge of Chemistry and as such it has to rely on the specialist employees having<br />
the requisite qualifications and experience.<br />
With the separation of chemical business of our Company as above, our Polyester business at Chennai started<br />
focusing on Speciality Fibres, Speciality Polymers and Preforms. In order that the name of our Company<br />
correctly reflects the core business in which it is engaged in, our Company changed its name to “Futura<br />
Polyesters Limited” which became effective from November 05, 2002. (“Futura” is the registered trademark of<br />
our Company under which it markets its products.)<br />
During the year 1993, our Company commenced production of PET Resin and Preforms at Manali, Chennai,<br />
under the name Futura Polymers Limited, as a joint venture with PepsiCo, USA, through its investment arm<br />
Transmere Inc., Mauritius. Subsequently during the year 1998, PepsiCo Inc. quit the joint venture. During the<br />
year 2002, Futura Polymers Limited was amalgamated with our Company.<br />
Our Company has one manufacturing facility at Chennai, currently consistingof three major activities, namely,<br />
Polyester Staple Fibres/Chips, PET Resins and PET Preforms. The installed capacities of these as on March 31,<br />
2008 are as under:<br />
Product<br />
Installed Capacity in MT per<br />
annum<br />
139
Polyester Staple Fibre / Chips 38,500<br />
Solid State Polymers 57,000<br />
PET Preforms 20,000<br />
We had established a subsidiary called Futura Industries Limited (FIL) to carry out Development on PET<br />
recycling and commercialise the technology for recycling of Polyester fibre waste and PET bottle scrap into<br />
polyester feed stock. Initially, the factory was located at Tiruvellore, near Chennai. FIL was carrying out the<br />
operations on job work basis for our Company for some time and the facilities were shifted, during 1997from<br />
Tiruvellore to the main factory located at Manali, Chennai. In the year 2001, FIL was amalgamated with our<br />
Company. Presently, the PET recycling activity is being carried out at our factory at Manali, Chennai.<br />
Our Competitive Strengths<br />
6 Experienced Promoters supported by qualified management team<br />
Our Promoters Mr. Shyam Bhupatirai Ghia and Mr. Mukund Dharamdas Dalal are well qualified and<br />
possess vast industry experience of more than three decades. Our management team also possesses the<br />
requisite qualifications and experience commensurate with their responsibilities. As of March 31, 2008 our<br />
total employee strength is 827. We aim to recruit talented employees and assist them in further development<br />
of their skills and expertise.<br />
7 Inhouse Research and Development facilities<br />
Our inhouse Research and Development (R&D) facilities enable us to produce innovative and quality<br />
products. Experts in the relevant fields are employed to carryout continuous development activity to<br />
produce specialty products to cater to varied customers’ needs. Our R&D efforts have led us in the<br />
development of products such as Special Hot Fill Resin for fruit juice application, Special Wave-PET Resin<br />
for dual ovenable trays, Special Jar PET Resin as Poly Carbonate substitute for five gallon water jars, Beer<br />
PET Resin for tunnel pasteurisable Beer with CO 2 , O 2 barrier, Easy Dyeable Resin/V-Flex Resin for textile<br />
applications, Green PET Resin with 20% recycled content, Heavy metal free Resin and Resin for<br />
pasteurisable juice containers and such specialised applications. Our R&D efforts have led us to patenting<br />
process for producing Fast Reheat Bottle Grade PET Resin and product patent pertaining to Thermo Plastic<br />
Crystalline PET. Since we operate in a dynamic industry, our R&D efforts are continuous so as to<br />
supplement our product base with newer and quality products.<br />
8 Established marketing network<br />
We have a well-established marketing network present in India and abroad. We market our Preforms and<br />
Resin products directly to our customers and Fibre products primarily through commission agents.<br />
Presently, we have eleven commission agents in India and nine outside India. We market our products in<br />
Europe, Middle East, USA and South East Asian countries. We interact with our customers on a regular<br />
basis to understand their specific needs and latest trends in the industry so as to serve them better.<br />
9 Diverse product mix<br />
Our diverse product mix enables us to serve varied customers’ needs in a short span of time. We have<br />
presence in Polyester Fibres, PET Resins and Preforms products. Our Polyester fibre products are speciality<br />
coloured fibres. We are able to change our product mix to suit our customers’ needs quickly due to our<br />
flexible batch product lines. We have through our R&D efforts developed speciality fibres like V-Flex High<br />
Shrink, Flame retardant moisture management and special effects fibres. We also manufacture products like<br />
Polyester Tow, Tops and Low Pill Fibres. Polymer products cover the entire range of Polyesters namely,<br />
PET, PEN, PTT, PBT, PTN, PBN. Our PET Preforms are used by bottling units for blowing into bottles of<br />
different sizes for filling juices, carbonated beverages and water. We have developed speciality performs<br />
for small Carbonated Soft Drink, beer and Pasteurable containers.<br />
10 Focus on Specialty segment<br />
We are focused on specialty niche segment, as we believe that our margins can improve by targeting<br />
customers in that segment. Based on our understanding of the dynamic nature of the industry in which we<br />
operate, we devise our business strategy accordingly. It is realized that the Commodity PET Resin market is<br />
increasingly turning regional and exports are going to be increasingly difficult. Nevertheless, we have<br />
completed R&D initiative to launch a wide range of Speciality PET Resins such as Fast Reheat Resin for<br />
140
High Speed blow moulding, Hot Fill Resin for fruit juice application, Wave PET Resin for dual ovenable<br />
trays, Jar PET Resin as Poly Carbonate substitute for five gallon water jars, Beer PET Resin for Beer with<br />
C0 2 /0 2 barrier, cationic dyeable resin easy dyeable resin for textile applications, Green PET Resin, with<br />
20% recycled content for US eco-label compliance and heavy metal free Resin.<br />
Collaborations/tie-ups/associations<br />
As on the date of Draft Letter of Offer, we have not entered into any collaboration/tieups/association<br />
Factors affecting our results of operations<br />
Our business, results of operations and financial conditions are affected by the following factors: -<br />
Our business plans may need substantial capital and additional financing in the form of debt and/or equity to<br />
meet our requirements.<br />
Our business requires a substantial amount of working capital. In many cases, working capital is required to<br />
finance the purchase of materials. Our working capital requirements may increase if, in certain contracts,<br />
payment terms do not provide for advance payments to us or if payment schedules are less favorable to us. We<br />
may need additional financing in the future in the form of debt and/or equity to fulfill our working capital needs.<br />
Continued increases in working capital requirements may have an adverse effect on our financial condition and<br />
results of operations.<br />
If we are unable to attract and retain key employees, our operations could be adversely affected.<br />
Our business substantially depends on the continued service of our key managerial personnel. The loss of the<br />
services of our key managerial personnel could have a material adverse effect on us. Our future success will also<br />
depend on our ability to attract highly skilled personnel, such as engineering, project management and senior<br />
management professionals. We could experience difficulty from time to time in hiring the personnel necessary<br />
to support our business. If we do not succeed in attracting new high quality employees, our reputation may be<br />
adversely impacted harmed and our future earnings may be negatively impacted.<br />
Increase in the cost of raw materials, particularly petroleum-based raw materials, have put pressure on our<br />
margins and could have a material adverse impact on our financial condition and results of operations.<br />
Volatility of raw material prices may have a negative impact on the financial performance of our Company.<br />
The raw materials required to manufacture polyester; preforms and PET resins are procured from<br />
petrochemicals, which are derived from hydrocarbons. These hydrocarbons are further extracted from crude oil<br />
and natural gas. Constant fluctuation in the price of crude oil in the international market has a direct impact on<br />
our cost of manufacturing. This consequent volatility in the price of our raw material may exercise a negative<br />
impact on the profitability of our product and financial performance of our Company.<br />
Production of polyesters, performs and PET requires raw materials which are procured from petroleum-based<br />
products. The cost of raw materials consumed by our Company constituted approximately 53.9% of our<br />
Company’s net sales for FY 2008 and approximately 57.2% of our Company’s net sales for FY 2007. Constant<br />
increase in the price of crude oil in the international market, specially in the last couple of years, has a direct<br />
impact on our cost of manufacturing. Any increase in the cost of the raw materials can adversely impact our<br />
profit margins if we are unable to pass on the increased cost on to our customers. Further, even if we are able to<br />
pass on the increase in raw material prices to our customers, this may reduce the demand for our products. To<br />
the extent that our Company uses virgin raw material (vis-à-vis recycled raw material), this consequent volatility<br />
in the price of raw materials may have a material adverse impact on our business, financial condition and results<br />
of operations.<br />
The demand for PSF is substantially dependent on the prices of other fibres (primarily cotton), and reduction<br />
in prices of other fibres may adversely affect PSF demand.<br />
One of our key products is PSF, which accounted for 41.42% and 46.69% of our sales in FY 2007 and FY 2008.<br />
PSF is primarily used in the textile industry, and is blended with other fibres (including cotton) in textile<br />
production. The blending percentage in the textile industry depends, in part, upon the prices of the respective<br />
fibres used in the blend. Any fall in the prices of other fibres (primarily cotton), on account of excess production<br />
or otherwise, may lead to reduction of percentage of PSF in the blends, thereby adversely affecting the demand<br />
for PSF, which would have a material adverse effect on our turnover, and consequently on our business, results<br />
of operations and financial condition.<br />
141
Our Company places heavy reliance on the import of raw material<br />
Our Company has to rely heavily on the import of raw materials for manufacturing polymer. Timely<br />
Pprocurement of raw material is the most critical aspect of our manufacturing operation and the same is subject,<br />
inter alia, to laws monitoring the import in India as also laws governing exports in the countries/territories from<br />
where the exports originate, soverign and territorial factors, among others. Further, aAny change in the importexport<br />
policy by the Government of India may have a negative impact on the import of our raw materials.<br />
At times our Company has to depend on third party manufacturers for the supply of polymer and disruption<br />
in their operations may have a negative impact on our manufacturing operations.<br />
Our Company has in house provision for the manufacture of polymer, which acts as a raw material for<br />
generating performs. However, there are occasions when in order to execute orders in bulk, our Company has to<br />
procure polymer from other manufacturers. Our Company has relied on these suppliers in times of exigencies<br />
pertaining to the supply of polymer. Any change in the supply pattern of third party suppliers may have a<br />
negative impact on the manufacture of performs, in case of any paucity in the in house manufacture of polymer.<br />
Potential fluctuations in future operating results on account of increase in raw material costs, transportation<br />
costs etc.<br />
The factors for potential fluctuations in future operating results include are:<br />
a. Cost of Raw Materials<br />
Purified Terepthalic Acid and Mono Ethylene Glycol are the major raw materials used in the manufacturing<br />
of our products. A major portion of the requirements of the basic raw materials by our Company is<br />
imported. The cost of such materials to ourour Company depends upon the prices ruling in the international<br />
commodity markets at the time of imports, over which our Company do not have any control. Any increase<br />
in the price of PTA and MEG would directly affect the margins profitability of our Company.<br />
b. Labour Union<br />
Our Company employs a large number of work force at its manufacturing plant. The factory workers are<br />
affiliated to particular Trade Union(s). Any concerted industrial action could always disrupt the production<br />
volume and consequently the sales growth of our Company.<br />
c. Transportation<br />
Timely delivery of products is critical for our performance. We use third-party transporters for the supply of<br />
raw materials to our factories and for delivery of finished products to our customers. Any hindrance in the<br />
logistics network, serious strike, stoppage of work, etc by the fleet owners could cause an adverse effect on<br />
our receipt of supplies and our ability to deliver our finished products in time, which could impact our<br />
business. Further, high transportation cost and escalation thereof may affect our profitability. Our Company<br />
engages a large number of heavy and light commercial trucks for movement of both raw materials to its<br />
manufacturing plants and finished products to its distribution centers and thereafter to its end customers.<br />
Any serious strike, stoppage of work, etc by the fleet owners could disrupt the production and sales volume<br />
of our Company.<br />
Our existing manufacturing unit is geographically located in Manali, Chennai. Any unrest or natural<br />
calamity in this unit can break down our operations which will adversely affect our operations.<br />
Our manufacturing units at Manali, Chennai and our business operations are vulnerable to damage or<br />
interruptions in operations due to adverse weather conditions, earthquakes, tsunami, fires, explosions, power<br />
loss, software flaws, viruses, transmission cable cuts or similar events. Any failure of our systems or any<br />
shutdown of any part of our manufacturing units, networks, operations because of operational disruption, natural<br />
disaster such as flood or earthquake, or otherwise, could disrupt our services and result in significant costs.<br />
While our Company has not in the past experienced any interruptions, either due to a natural disaster or a<br />
systems failure, tFurther, there can be no assurance that business continuity plans we have developed to cover<br />
material breakdowns or damage to our manufacturing units, network or critical operating equipment will be<br />
sufficient to maintain our operations in all adverse circumstances.<br />
Any loss of or breakdown of machinery at any of the our manufacturing facility at Manali, Chennai may<br />
have an adverse affect on business, financial condition and results of operations<br />
142
Our Company’s manufacturing facility at Manali, Chennai is are subject to operating risks, such as the<br />
breakdown or failure of equipment, power supply or processes, performance below expected levels of output or<br />
efficiency, obsolescence, labour disputes, industrial accidents and the need to comply with the directives of<br />
relevant government authorities. The occurrence of any of these risks could significantly affect its operating<br />
results. Our business and operations may be adversely affected by any disruption of operations at our<br />
manufacturing facilities.<br />
Our significant accounting policies<br />
System of Accounting<br />
The financial statements are prepared under Historical cost convention on an accrual basis except for certain<br />
fixed assets which have been revalued.<br />
Fixed Assets and Depreciation<br />
Fixed Assets<br />
Fibre, Resin and Preforms Divisions.<br />
Fixed Assets are stated at cost less depreciation. Cost comprises of Cost of acquisition, cost of<br />
improvements and any attributable cost of bringing the asset to condition for its intended use. Interest on<br />
loans taken for the procurement of specific assets accrued upto the date of acquisition/ installation of the<br />
said assets is capitalised along with the cost of the assets.<br />
Depreciation<br />
Fibre Division:<br />
Depreciation has been provided on Plant and Machinery and Research and development facilities on<br />
straight line basis and on other assets on written down value basis at the rates specified in Schedule XIV of<br />
the Companies Act, 1956 as amended from time to time. Certain Plants have been treated continuous<br />
process Plants based on technical and other evaluation. However, higher rate of depreciation has been<br />
provided on certain Plant and Machinery ranging from 6.75% -12.50% compared to 5.28% of Schedule<br />
XIV rate, based on technical evaluation. The total accumulated depreciation is restricted up to 95% of the<br />
Gross Block Value.<br />
Resin and Preforms Divisions:<br />
Depreciation has been provided on all assets on straight line basis at the rates specified in Schedule XIV of<br />
the Companies Act, 1956 as amended from time to time. However, higher rate of depreciation has been<br />
provided on certain Plant and Machinery ranging from 6.75%-12.50% compared to 5.28% of Schedule XIV<br />
rate, based on technical evaluation. The total accumulated Depreciation is restricted up to 95% of the Gross<br />
Block Value.<br />
143
Investments<br />
Investments are classified into current and long term investments. Current investments are stated at the<br />
lower of cost and fair value, Long term investments are stated at cost. A provision for diminution is made to<br />
recognise a decline, other than temporary, in value of long term investments.<br />
Income on Investments:<br />
Dividend income is accounted when right to receive payment is established.<br />
Interest income is accounted on accrual basis.<br />
Inventories<br />
Inventories are valued as under:<br />
i. Fibre Division and Chemical Division<br />
Raw materials, packing materials, stores and spares: at Cost (Weighted average method) Materials-in-transit<br />
and semi finished goods: at Cost. (Weighted average method)<br />
Finished goods: at lower of cost or net realisable value. (Weighted average method)<br />
Traded items: at lower of cost or net realisable value. (Weighted average method)<br />
ii.<br />
Resin and Preforms Divisions:<br />
Raw materials: At Cost (FIFO)<br />
Semi finished Goods: At Cost (FIFO)<br />
Finished goods: At lower of cost or net realisable value (Cost FIFO Basis)<br />
Stores, Spares and Packing Materials: At Cost (FIFO).<br />
Sales and Services<br />
Sale of goods is recognised on despatch to customers. Sales include amounts recovered towards excise<br />
duty, but exclude amounts recovered towards sales tax. Service income is recognised as per terms of<br />
agreements.<br />
Export Incentives<br />
Export Incentives are accounted on an accrual basis.<br />
Foreign Currency Transactions<br />
Transactions in foreign currencies are recorded at current rates except transactions covered by forward<br />
contracts. Assets and Liabilities denominated in foreign currency are restated at the year end rates. All<br />
exchange gains and losses except those relating to acquisition of fixed assets which are adjusted to the<br />
carrying cost of such assets, are accounted for in the Profit and Loss Account.<br />
Research and Development<br />
Revenue expenditure on research and development is charged as an expense in the year in which they are<br />
incurred. <strong>Capital</strong> expenditure is shown as an addition to Fixed Assets.<br />
New Product Development Expenditure<br />
Expenditure incurred on development of new products are amortised over a period of 10 years.<br />
Employee Benefits<br />
i. Defined Contribution Plan<br />
144
Company’s contributions paid /payable during the year to Superannuation Fund, ESIC and Labour<br />
Welfare Fund are recognized in the Profit and Loss Account. There are no other obligations other than<br />
the contribution payable to the respective trust / Fund. Company’s Contribution towards Superannuation<br />
and ESIC is based on a percentage of salary which is made to an approved fund.<br />
ii. Defined Benefit Plan<br />
Company’s Contribution towards Provident Fund is based on a percentage of salary which is made to an<br />
approved fund.<br />
Company’s Contribution towards Gratuity is made to an approved fund as per actuarial valuation<br />
certificate obtained from an actuary, which is determined using projected unit credit method.<br />
iii. Short term compensated absences are provided as per actuarial valuation certificate obtained from an<br />
actuary which is determined using projected unit credit method.<br />
iv. Long term employee benefit<br />
Long term compensated absences are provided as per actuarial valuation certificate obtained from an<br />
actuary which is determined using projected unit credit method.<br />
v. Actuarial gains / losses are immediately taken to profit and loss account and are notdeferred.<br />
J. Deferred Revenue Expenses:<br />
Voluntary Retirement Scheme related payments are amortised over a period of 5 years<br />
K. Taxes on Income<br />
i. Current Tax: Provision for Income Tax is determined in accordance with the provision of Income Tax<br />
Act, 1961.<br />
ii. Deferred Tax Provision: Deferred tax is recognised on timing differences between the accounting<br />
income and the taxable income for the year and quantified using the tax rates and laws enacted or<br />
subsequently enacted on the Balance Sheet date. Deferred tax assets are recognised and carried<br />
forward to the extent that there is a reasonable certainty that sufficient future taxable income will be<br />
available against which such deferred tax assets can be realised.<br />
Overview of our Results of Operations<br />
Income<br />
We derive our income from (i) Sales income and (ii) other income.<br />
Sales income<br />
The following table sets forth our product wise income i.e., PSF, PET Resin and PET Preform for the periods<br />
FY 2008, FY2007, FY 2006, & FY2005.<br />
(Rs. in lacs)<br />
Particulars 2007-08 2006-07 2005-06 2004-05<br />
Amount % Amount % Amount % Amount %<br />
Polyester Staple Fibre 20,911.66 46.69 22,486.94 41.42 22,433.09 43.95 26,839.49 53.57<br />
PET Resin 15,235.26 34.02 23,780.16 43.80 20,997.11 41.13 12,414.43 24.78<br />
PET Preforms 8,641.21 19.29 8,022.95 14.78 7,617.24 14.92 10,843.28 21.65<br />
Total income 44,788.13 100.00 54,290.05 100.00 51,047.44 100.00 50,097.20 100.00<br />
145
Other Income<br />
Other income includes income from dividend on investments, profit on sale of fixed assets, income from interest<br />
and other miscellaneous income. Other income as a percentage of total income was 3.04 %, in the fiscal 2008.<br />
Expenditure<br />
The major components of expenditure of our Company are raw materials consumed, personnel expenses,<br />
administrative and selling expenses, finance expenses, depreciation, and preliminary expenses written off. The<br />
following table shows various expenses for past 5 years.<br />
a. Expenses as a % of Total Expenses<br />
(Rs. In lacs)<br />
Particulars 2007-08 2006-07 2005-06 2004-05 2003-04<br />
EXPENDITURE Amount % Amount % Amount % Amount % Amount %<br />
Raw material consumed 23,590.41 56.30 29,400.62 59.24 29,802.01 59.82 28,881.78 59.49 23,200.74 53.23<br />
Staff Costs 1,690.89 4.03 2,009.97 4.05 1,990.54 4.00 1,833.13 3.78 1,982.94 4.55<br />
Other Manufacturing Exp. 10,055.20 24.00 11,822.37 23.82 11,372.38 22.83 11,001.91 22.66 10,325.83 23.69<br />
Administration Exp. 1,265.81 3.02 1,111.74 2.24 1,083.47 2.17 1,092.17 2.25 1,247.95 2.87<br />
Selling & DistributionExp 1,479.22 3.53 1,946.43 3.92 2,198.18 4.41 2,345.33 4.83 2,370.26 5.44<br />
Purchase of traded items 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 170.48 0.39<br />
Interest 2,126.66 5.08 1,764.13 3.56 1,890.76 3.80 1,917.19 3.95 2,411.58 5.53<br />
Depreciation 2,577.57 6.15 2,478.71 4.99 2,391.90 4.80 2,410.31 4.97 2,188.33 5.02<br />
Less: - Transfer from<br />
(884.15) (2.11) (907.73) (1.83) (910.15) (1.83) (937.42) (1.93) (311.76) (0.72)<br />
Revaluation Reserve<br />
Total 41,901.61 100.00 49,626.24 100.00 49,819.09 100.00 48,544.40 100.00 43,586.35 100.00<br />
b. Expenses as a % of Total Income<br />
(Rs. In lacs)<br />
Particulars 2007-08 2006-07 2005-06 2004-05 2003-04<br />
EXPENDITURE Amount % Amount % Amount % Amount % Amount %<br />
Raw material consumed 23,590.41 53.94 29,400.62 57.20 29,802.01 60.79 28,881.78 58.39 23,200.74 58.09<br />
Staff Costs 1,690.89 3.87 2,009.97 3.91 1,990.54 4.06 1,833.13 3.71 1,982.94 4.97<br />
Other Manufacturing Exp. 10,055.20 22.99 11,822.37 23.00 11,372.38 23.20 11,001.91 22.24 10,325.83 25.85<br />
Administration Exp. 1,265.81 2.89 1,111.74 2.17 1,083.47 2.21 1,092.17 2.21 1,247.95 3.12<br />
Selling & DistributionExp 1,479.22 3.38 1,946.43 3.79 2,198.18 4.48 2,345.33 4.74 2,370.26 5.93<br />
Purchase of traded items 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 170.48 0.43<br />
Interest 2,126.66 4.86 1,764.13 3.43 1,890.76 3.86 1,917.19 3.88 2,411.58 6.04<br />
Depreciation 2,577.57 5.89 2,478.71 4.82 2,391.90 4.88 2,410.31 4.87 2,188.33 5.48<br />
Less: - Transfer from<br />
(884.15) (2.02) (907.73) (1.77) (910.15) (1.86) (937.42) (1.90) (311.76) (0.78)<br />
Revaluation Reserve<br />
Total 41,901.61 95.80 49,626.24 96.55 49,819.09 101.62 48,544.40 98.14 43,586.35 109.13<br />
Profit before Tax 1835.44 4.20 1770.65 3.45 (795.69) (1.62) 920.06 1.86 (3648.00) (9.13)<br />
Raw material consumed<br />
The raw material consumed comprises of a significant portion of the expenditure. The main raw material used in<br />
our business is Purified Terephtalic Acid (PTA) and Mono – Ethylene Glycol (MEG). In the fiscal year 2008,<br />
raw material expenses were 56.30 % of the total expenditure.<br />
Manufacturing and other expenses<br />
Manufacturing expenses comprises of manufacturing fees, material handling charges, power and fuel, stores,<br />
spares, packaging material, and repair and maintenance. Power and fuel are the major component of the<br />
manufacturing expenses. In the fiscal year 2008, power and fuel expenses were approximately 57 % of the total<br />
manufacturing expenses and stores, spares and packaging material accounted for approximately 31 % of the<br />
manufacturing expenses.<br />
Staff Costs<br />
Our staff costs consist of salaries, wages and bonus. These expenses are approximately 4 % of the total<br />
expenditure for the fiscal year 2008.<br />
146
Administration, selling and distribution expenses<br />
Our administration expenses comprise of insurance charges, rent, rates and taxes, audit fees, fees for taxation<br />
matters, certification services etc. Our selling expenses comprises of travelling and conveyance, freight,<br />
commission on brokerage and sales etc. These expenses vary from 6 % to 8 % of the total expenditure in past<br />
few years. For the fiscal year 2008, these expenses were 6.55 % of total expenditure.<br />
Finance Expenses<br />
Finance expenses comprise of the interest on term loan, fixed deposits, short-term deposits and other bank<br />
charges. For the fiscal year 2008, these expenses were 5.08 % of total expenditure.<br />
Taxes<br />
Income Taxes are accounted for in accordance with Accounting Standard – 22 issued by the ICAI on<br />
“Accounting for Taxes on Income”. Taxes comprises of both current and deferred taxes. Provision for current<br />
taxes is made at the current tax rates after taking into consideration the benefits admissible under the provisions<br />
of the Income Tax Act 1961. For further details of our tax benefits, please refer to section titled "Statement of<br />
Tax Benefits" on page no 25 in the draft Letter of Offer.<br />
Deferred tax arises from the timing differences between book profits and taxable profits that originate in one<br />
period and are capable of reversal in one or more subsequent periods and is measured using the tax rates and<br />
laws that have been enacted or subsequently enacted as on date of financial statements. We provide for deferred<br />
tax liability on such timing differences subject to prudent considerations in respect of deferred tax assets. The<br />
significant timing differences include the difference in depreciation as per books of accounts and Income Tax<br />
Act 1961. Deferred tax arising on timing differences between book profits and tax profits has not been<br />
accounted as the same are reversing within the tax holiday period.<br />
Earning before interest, depreciation, tax and amortization (EBIDTA)<br />
The EBIDTA of our company is 12.93 % for the fiscal 2008. EBIDTA has increased from Rs. 5105.76 lacs in<br />
the fiscal year 2007 to Rs. 5655.52 lacs in the fiscal year 2008.<br />
Review of Financial Position<br />
Fixed Assets<br />
Fixed assets of our Company comprises of land, building, plant and machinery, furniture, fixture, vehicles etc<br />
used in our construction business. In the year 2008, the plant and machineries were 41.12 % of the fixed assets<br />
of our Company. As mentioned in the table below, there has been a consistent growth in the fixed assets in tune<br />
with increased operations.<br />
(Rs. In lacs)<br />
Particulars 2007-08 2006-07 2005-06 2004-05 2003-04<br />
Fixed Assets<br />
Gross Block 59,885.68 43,437.40 41,637.34 40,134.39 39,530.90<br />
Less: Depreciation 25,997.55 23,776.81 21,438.63 19,071.16 16,698.29<br />
Net Block 33,888.13 19,660.59 20,198.71 21,063.23 22,832.61<br />
Current Assets<br />
Our Current assets comprise of inventory, sundry debtors, cash and bank balances, loans and advances. The<br />
current assets are increasing every year with the growth in the business. Inventory comprises of stores, spares,<br />
packaging materials, raw materials, semi finished goods and finished goods. Loans and advances mainly<br />
comprise of advances recoverable in cash, advance payment of tax, balances with excise, customs etc.<br />
(Rs. In lacs)<br />
Particulars 2007-08 2006-07 2005-06 2004-05 2003-04<br />
Inventory 11,825.74 8,320.37 9,484.56 7,568.29 5,188.71<br />
Sundry Debtors 3,742.01 3,647.75 2,464.08 4,230.74 2,534.73<br />
Cash and Bank Balances 1,824.15 1,734.06 1,947.84 1,514.78 4,364.45<br />
Loans and Advances 2,651.44 2,760.63 2,525.71 1,767.76 2,225.11<br />
Total 20043.34 16,462.81 16,422.19 15,081.57 14,313.00<br />
147
Current liabilities and provisions<br />
Current liabilities and provisions mainly comprises of sundry creditors, advance from customers and other<br />
liabilities.<br />
(Rs. In lacs)<br />
Particulars 2007-08 2006-07 2005-06 2004-05 2003-04<br />
Liabilities 14,971.69 11,096.21 11,902.68 10,900.22 13,186.00<br />
Provisions 877.99 775.36 709.31 638.27 625.50<br />
Total 15,849.68 11,871.57 12,611.99 11,538.49 13,811.50<br />
Non-Current liabilities<br />
Secured loans are mainly term loans and working capital loans. Unsecured loan is the loan from financial<br />
institutions, banks, employees, shareholders and inter corporate deposits.<br />
(Rs. In lacs)<br />
Particulars 2007-08 2006-07 2005-06 2004-05 2003-04<br />
Secured Loans 11,585.42 10,604.11 10,474.00 9,734.59 10,541.62<br />
Unsecured Loans 4,327.35 4,437.61 4,662.89 5,452.95 4,507.62<br />
Deferred<br />
Tax<br />
(Asset)/Liabilities (net)<br />
74.57 541.19 975.13 1,115.87 1,486.20<br />
Summary Statement of Profits and Losses<br />
(Rs. In lacs)<br />
Particulars<br />
For the year ending 31 st march<br />
INCOME<br />
2007-08<br />
2006-07<br />
2005-06<br />
2004-05 2003-04<br />
Sales and Services (Gross) 44,814.30 56,146.50 52,138.73 52,175.54 45,205.23<br />
Less: - Excise Duty 4,464.34 4,621.98 5,023.54 4,956.42 4,341.82<br />
Service Income 1,012.80 181.90 - 174.72 124.81<br />
Total 41,362.76 51,706.42 47,115.19 47,393.84 40,988.22<br />
Other Income 1,295.89 520.17 487.99 587.72 610.98<br />
(Less)/Add: (Increase)/Decrease in<br />
Inventories<br />
-1,078.40 -829.70 -1,420.22 -1,482.90 -1,660.85<br />
EXPENDITURE<br />
Raw Material Consumed 23,590.41 29,400.62 29,802.01 28,881.78 23,200.74<br />
Staff Costs 1,690.89 2,009.97 1,990.54 1,833.13 1,982.94<br />
Other Manufacturing Expenses 10,055.20 11,822.37 11,372.38 11,001.91 10,325.83<br />
Administration Expenses 1,265.81 1,111.74 1,083.47 1,092.17 1,247.95<br />
Selling and Distribution Expenses 1,479.22 1,946.43 2,198.18 2,345.33 2,370.26<br />
Purchase of Traded Items - - - - 170.48<br />
Interest 2,126.66 1,764.13 1,890.76 1,917.19 2,411.58<br />
Depreciation 2,577.57 2,478.71 2,391.90 2,410.31 2,188.33<br />
Less:- Transfer from Revaluation<br />
Reserve (884.15) (907.73) (910.15) (937.42) (311.76)<br />
Net Profit /(Loss) before Tax and<br />
Extraordinary items 1,835.44 1,770.65 (795.69) 920.06 (3,648.00)<br />
Add: Profit on sale of Chemical<br />
Business - - - - 1,626.97<br />
Less: Voluntary Retirement Scheme 8.39 25.39 57.75 86.39 264.62<br />
Less: Deferred VRS Gratuity<br />
Payment - 31.51 100.61 100.61 100.61<br />
Profit / (Loss) after extra ordinary<br />
items but before tax 1,827.05 1,713.75 (954.05) 733.06 (2,386.26)<br />
Less: Provision for Tax 203.83 192.28 - - -<br />
Less: Provision for Wealth Tax 2.00 2.00 2.00 2.29 2.50<br />
148
Less: Provision for Fringe Benefit<br />
Tax 28.00 23.00 43.00 - -<br />
Add: Deferred Tax adjustment (466.61) (433.94) (140.74) (370.33) 2,188.15<br />
Less: Excess Provision of Earlier<br />
Years (1.17) - - - -<br />
NET PROFIT/(LOSS) AFTER<br />
TAX 1,127.78 1,062.53 (1,139.79) 360.44 (200.61)<br />
Balance brought forward from<br />
Previous Year 1,064.57 2.04 1,141.83 781.39 982.00<br />
BALANCE CARRIED TO<br />
BALANCE SHEET 2,192.35 1,064.57 2.04 1,141.83 781.39<br />
Comparison of fiscal year 2007 with 2008<br />
Sales Income<br />
Sales income decreased by 20.18 % from Rs. 56,146.50 lacs in fiscal year 2007 to Rs. 44,814.30 lacs in fiscal<br />
year 2008. The decrease in sales income has been primarily due to debottlenecking of plant to achieve high<br />
margin low volume specialty products, shifting to tolling business and operating some part of the specialty<br />
chemical business through Innovasynth Technologies (India) Limited.<br />
Other Income<br />
Other income increased by 149.13 % from Rs. 520.17 lacs in fiscal year 2007 to Rs. 1,295.89 lacs in fiscal year<br />
2008. The increase in other income has been due to profit on sale of land and building of Rs. 649 lacs and<br />
interest on income tax refund of Rs. 265 lacs.<br />
Raw material consumed<br />
Raw material consumed decreased by 19.76 % from Rs. 29,400.62 lacs in fiscal year 2007 to Rs. 23,590.41 lacs<br />
in fiscal year 2008. The raw materials have contributed 53.94 % to the sales revenue generated by the Company.<br />
This has decreased in proportion to sales.<br />
Staff Costs<br />
Staff costs have decreased from Rs. 2,009.97 lacs in the fiscal year 2007 to Rs. 1,690.89 lacs in the fiscal year<br />
2008, showing a decrease of 15.87 %. The decrease was primarily due to expenses capitalised.<br />
Manufacturing expenses<br />
Manufacturing expenses have decreased from Rs. 11,822.37 lacs in the fiscal year 2007 to Rs. 10,055.20 lacs in<br />
the fiscal year 2008, showing a decrease of 14.95 %. The decrease was due to transfer of business to<br />
Innovasynth Technologies (India) Limited.<br />
Administrative, selling and distribution expenses<br />
The administrative, selling and distribution expenses decreased from Rs. 3,058.17 lacs in the fiscal year 2007 to<br />
Rs. 2,745.03 lacs during the fiscal year 2008 showing a decrease of 10.24 %. This decrease is mainly due to<br />
resin turnover business going down and sales to Pepsico being made on FOB basis from CIF. It was also due to<br />
reduction in freight due to tolling business of preforms<br />
Financial expenses<br />
Financial expenses increased from Rs. 1,764.13 lacs for the fiscal year 2007 to Rs. 2,126.66 lacs for the fiscal<br />
year 2008 showing an increase of 20.55 %. The increase in financial cost is due to increase in secured<br />
borrowings and interest rates.<br />
Depreciation<br />
149
The depreciation has increased from Rs. 2,478.71 lacs for the fiscal year 2007 to Rs. 2,577.60 lacs for the fiscal<br />
year 2008 showing a increase of 3.99 %. This has been due to increase in depreciation on intangible assets.<br />
Earning before Interest, Depreciation, Tax and Amortization (EBIDTA)<br />
Earning before interest, depreciation, tax and amortisation has increased from Rs. 5,105.76 lacs for the fiscal<br />
year 2007 to Rs. 5,655.52 lacs during the fiscal year 2008 showing an increase of 10.77 %.<br />
Profit / (Loss) after tax<br />
As a result of foregoing, our Company has grown from Rs. 1,062.53 lacs for the fiscal year 2007 to Rs. 1,127.78<br />
lacs for the fiscal year 2008 showing an increase of 6.14 %.<br />
Comparison of fiscal year 2006 with 2007<br />
Sales Income<br />
Sales income increased by 7.69 % from Rs. 52,138.73 lacs in fiscal year 2006 to Rs. 56,146.50 lacs in fiscal<br />
year 2007. The increase in sales income has been primarily due to increase in sales volume, particularly in<br />
specialty resin.<br />
Other Income<br />
Other income increased by 6.59 % from Rs. 487.99 lacs in fiscal year 2006 to Rs. 520.17 lacs in fiscal year<br />
2007. The increase in other income has been due to profit on sale of fixed assets.<br />
Raw material consumed<br />
Raw material consumed decreased by 1.35 % from Rs. 29,802.01 lacs in fiscal year 2006 to Rs. 29,400.62 lacs<br />
in fiscal year 2007. The direct expenses have contributed 57.20 % to the sales revenue generated by the<br />
Company. This has decreased due to disproportionate price increase in raw materials vis-à-vis finished products<br />
Staff Costs<br />
Staff costs have increased from Rs. 1,990.54 lacs in the fiscal year 2006 to Rs. 2,009.97 lacs in the fiscal year<br />
2007, showing a increase of 0.98 %. The increase was is due to routine salary increase to employees.<br />
Manufacturing expenses<br />
Manufacturing expenses have increased from Rs. 11,372.38 lacs in the fiscal year 2006 to Rs. 11,822.37 lacs in<br />
the fiscal year 2007, showing an increase of 3.96 %. The increase was due to increase in manufacturing fees<br />
and other expenses.<br />
Administrative, selling and distribution expenses<br />
The administrative, selling and distribution expenses decreased from Rs. 3,281.65 lacs in the fiscal year 2006 to<br />
Rs. 3,058.17 lacs during the fiscal year 2007 showing a decrease of 6.81 %. This decrease is mainly due to<br />
decrease in freight charges and miscellaneous expenses.<br />
Financial expenses<br />
Financial expenses decreased from Rs. 1,890.76 lacs for the fiscal year 2006 to Rs. 1,764.13 lacs for the fiscal<br />
year 2007 showing a decrease of 6.70 %. The decrease in financial cost is due to marginal utilization of cash<br />
credit.<br />
Depreciation<br />
The depreciation has increased from Rs. 2,391.90 lacs for the fiscal year 2006 to Rs. 2,478.71 lacs for the fiscal<br />
year 2007 showing an increase of 3.63 %.<br />
Earning before Interest, Depreciation, Tax and Amortization (EBIDTA)<br />
Earning before interest, depreciation, tax and amortisation has increased from Rs. 2,576.82 lacs for the fiscal<br />
year 2006 to Rs. 5,105.76 lacs during the fiscal year 2007 showing an increase of 98.14 %.<br />
150
Profit / (Loss) after tax<br />
As a result of foregoing, our Company has grown from a loss Rs. 1,139.79 lacs for the fiscal year 2006 to a<br />
profit of Rs. 1,062.53 lacs for the fiscal the year 2007showing an increase of 193.22 %.<br />
Comparison of fiscal year 2005 with 2006<br />
Sales Income<br />
Sales income has decreased by 0.07 % from Rs. 52,175.54 lacs in fiscal year 2005 to Rs. 52,138.73 lacs in fiscal<br />
year 2006. The decrease in sales income has been due to decrease in sale of fibre and perform which was offset<br />
partly by increase in sales of polymer.<br />
Other Income<br />
Other income decreased by 16.97 % from Rs. 587.72 lacs in fiscal year 2005 to Rs. 487.99 lacs in fiscal year<br />
2006. The decrease in other income has been primarily due to reduction in interest receipts.<br />
Raw material consumed<br />
Raw material consumed increased by 3.19 % from Rs. 28,881.78 lacs in fiscal year 2005 to Rs. 29,802.01 lacs<br />
in fiscal year 2006. The raw materials consumed have contributed 60.79 % to the sales revenue generated by the<br />
Company. This has been in line with the increase in sales volumes for specialty resin.<br />
Staff Costs<br />
Staff costs have increased from Rs. 1,833.13 lacs in the fiscal year 2005 to Rs. 1,990.54 lacs in the fiscal year<br />
2006, showing an increase of 8.59 %. The increase was primarily due to increase in number of employees and<br />
increase in their salaries and wages.<br />
Manufacturing expenses<br />
Manufacturing expenses have increased from Rs. 11,001.91 lacs in the fiscal year 2005 to Rs. 11,372.38 lacs in<br />
the fiscal year 2006, showing an increase of 3.37 %. The increase was primarily due to increase on power and<br />
fuel.<br />
Administrative, selling and distribution expenses<br />
The administrative, selling and distribution expenses decreased from Rs. 3,437.50 lacs in the fiscal year 2005 to<br />
Rs. 3,281.65 lacs during the fiscal year 2006 showing a decrease of 4.53 % mainly due to income in brokerage<br />
on sales.<br />
Financial expenses<br />
Financial expenses decreased from Rs. 1,917.19 lacs for the fiscal year 2005 to Rs. 1,890.76 lacs for the fiscal<br />
year 2006 showing a decrease of 1.38 %. The decrease in financial cost is due to decrease in unsecured loans.<br />
Depreciation<br />
The depreciation has decreased from Rs. 2,410.31 lacs for the fiscal year 2005 to Rs. 2,391.90 lacs for the fiscal<br />
year 2006 showing a decrease of 0.76 %.<br />
Earning before Interest, Depreciation, Tax and Amortization (EBIDTA)<br />
Earning before interest, depreciation, tax and amortisation has decreased from Rs. 4,310.14 lacs for the fiscal<br />
year 2005 to Rs. 2,576.82 lacs during the fiscal year 2006 showing a decrease of 40.21 %.<br />
Profit (Loss) after tax<br />
The Company has incurred a loss of Rs. 1,139.79 lacs for the fiscal the year 2006 as compared to a profit of Rs.<br />
360.44 lacs for the fiscal year 2005 showing a decrease of 416.22 %.<br />
151
Comparison of fiscal year 2004 with 2005<br />
Sales Income<br />
Sales income increased by 15.71 % from Rs. 45,090.96 lacs in fiscal year 2004 to Rs. 52,175.54 lacs in fiscal<br />
year 2005. The increase in sales income has been due to increase is sales volume from the preforms segment and<br />
due to continued thrust on the specialty polymers.<br />
Other Income<br />
Other income decreased by 3.81 % from Rs. 610.98 lacs in fiscal year 2004 to Rs. 587.72 lacs in fiscal year<br />
2005. The decrease in other income has been primarily due to decrease in provision no longer required written<br />
back, sundry balances written back and decreases in miscellaneous income.<br />
Raw material consumed<br />
Raw material consumed increased by 24.49 % from Rs. 23,200.74 lacs in fiscal year 2004 to Rs. 28,881.78 lacs<br />
in fiscal year 2005. The raw materials consumed have contributed 58.39 % to the sales revenue generated by the<br />
Company. This has been in line with the growth in sales income.<br />
Staff Costs<br />
Staff costs have decreased from Rs. 1,982.94 lacs in the fiscal year 2004 to Rs. 1,833.13 lacs in the fiscal year<br />
2005, showing a decrease of 7.55 %. The decrease was primarily due to savings in staff welfare expenses.<br />
Manufacturing expenses<br />
Manufacturing expenses have increased from Rs. 10,325.83 lacs in the fiscal year 2004 to Rs. 11,001.91 lacs in<br />
the fiscal year 2005, showing an increase of 6.55 %. The increase was primarily due to significant increase in<br />
effluent disposal charges.<br />
Administrative, selling and distribution expenses<br />
The administrative, selling and distribution expenses decreased from Rs. 3,618.21 lacs in the fiscal year 2004 to<br />
Rs. 3,437.50 lacs in the fiscal year 2005 showing a decrease of 4.99 %. This decrease was primarily due to<br />
decrease in trading expenses.<br />
Financial expenses<br />
Financial expenses decreased from Rs. 2,411.58 lacs for the fiscal year 2004 to Rs. 1,917.19 lacs for the fiscal<br />
year 2005 showing a decrease of 20.50 %. The decrease in financial cost is due to reduction in secured loans.<br />
Depreciation<br />
The depreciation has increased from Rs. 2,188.33 lacs for the fiscal year 2004 to Rs. 2,410.31 lacs for the fiscal<br />
year 2005 showing an increase of 10.14 %. The increase is primarily due to higher rate of depreciation being<br />
charged on certain plant and machinery.<br />
Earning before Interest, Depreciation, Tax and Amortization (EBIDTA)<br />
Earning before interest, depreciation, tax and amortisation has increased from Rs. 810.63 lacs for the fiscal year<br />
2004 to Rs. 4,310.14 lacs for the fiscal year 2005 showing an increase of 431.70 %.<br />
Profit (Loss) after tax<br />
The Company has incurred a loss of Rs. 200.61 lacs for the fiscal year 2004 as compared to a profit of Rs.<br />
360.44 lacs for the fiscal the year 2004 showing an increase of 279.67 %.<br />
Cash flows<br />
The table below summarizes our cash flows for the periods FY2004, FY2005, FY2006, FY2007 and FY2008<br />
(Rs. In lacs)<br />
Particulars 2007-08 2006-07 2005-06 2004-05 2003-04<br />
Net Cash used / from Operating Activities 5,026.48 3,907.63 2,692.73 (2,483.54) 5,872.70<br />
Net cash from Investing Activities (3,648.84) (2,206.37) (1,515.73) (621.69) 1,759.74<br />
152
Net cash from/used in Financing Activities (1,287.55) (1,915.04) (7,43.94) 255.56 (5,283.55)<br />
Net increase in Cash and Cash Equivalents 90.09 (213.78) 433.06 (2,849.67) 2,348.89<br />
Cash flow from operating activities:<br />
Fiscal 2008: The net cash used in operating activities was Rs. 5,026.48 lacs, which was primarily due to cash<br />
generated from operations of Rs. 5,133.52 lacs and adjusted for depreciation of Rs. 1,693.42 lacs and further<br />
adjusted for interest expense for an amount of Rs. 2,126.66 lacs.<br />
Fiscal 2007: The net cash used in operating activities was Rs. 3,907.63 lacs, which was primarily due to cash<br />
generated from operations of Rs. 4,157.51 lacs and adjusted for depreciation of Rs. 1,570.98 lacs and further<br />
adjusted for interest expense for an amount of Rs. 1,764.13 lacs.<br />
Fiscal 2006: The net cash used in operating activities was Rs. 2,692.73 lacs, which was primarily due to cash<br />
generated from operations of Rs. 2,647.82 lacs and adjusted for depreciation of Rs. 1,481.75 lacs and further<br />
adjusted for an interest expense of Rs. 1,890.76 lacs.<br />
Fiscal 2005: The net cash used in operating activities was Rs. (2,483.54) lacs, which was primarily due to cash<br />
generated from operations of Rs. (2,518.56) lacs and adjusted for depreciation of Rs. 1,472.89 lacs and further<br />
adjusted for an interest expense of Rs. 1,917.19 lacs.<br />
Fiscal 2004: The net cash used in operating activities was Rs. 5,872.70 lacs, which was primarily due to cash<br />
generated from operations of Rs. 5,931.97 lacs and adjusted for depreciation of Rs. 1,876.57 lacs and further<br />
adjusted for an interest expense of Rs. 2,411.58 lacs.<br />
Cash flow from investing activities<br />
Fiscal 2008: Net cash used in investing activities was Rs. (3,648.84) lacs in fiscal year 2008, which was<br />
primarily for purchase of fixed assets of Rs. (4,669.13) lacs and partly offset by interest receipt of Rs. 269.22<br />
lacs and dividend receipt of Rs. 3.35 lacs.<br />
Fiscal 2007: Net cash used in investing activities was Rs. (2206.37) lacs in fiscal year 2007, which was<br />
primarily for purchase of fixed assets of Rs. (2,591.14) lacs and partly offset by interest receipt of Rs. 3.80 lacs<br />
and dividend receipt of Rs. 1.00 lacs.<br />
Fiscal 2006: Net cash used in investing activities was Rs. (1,515.73) lacs in fiscal year 2006, which was<br />
primarily for purchase of fixed assets of Rs. (1,762.27) lacs, purchase of investment of Rs. 220.00 lacs and<br />
partly offset by interest receipt of Rs. 6.62 lacs and dividend receipt of Rs. 0.07 lacs.<br />
Fiscal 2005: Net cash used in investing activities was Rs. (621.69) lacs in fiscal year 2005, which was primarily<br />
for purchase of fixed assets of Rs. (975.55) lacs and purchase of investment of Rs. 12.76 lacs and partly offset<br />
by interest receipt of Rs. 327.57 lacs and dividend receipt of Rs. 3.85 lacs.<br />
Fiscal 2004: Net cash used in investing activities was Rs. (1,759.74) lacs in fiscal year 2004, which was<br />
primarily for purchase of fixed assets of Rs. (579.70) lacs and purchase of investment of Rs. (2,499.96) lacs and<br />
a dividend receipt of 0.36 lacs.<br />
Cash flow from financing activities<br />
Fiscal 2008: Net cash from financing activities was Rs. (1,287.55) lacs in fiscal year 2008 which was primarily<br />
proceed received from long term borrowings of Rs. 981.31 lacs and repayment of short term borrowing of Rs.<br />
(249.02) lacs and partially offset by interest payment of Rs. (2,019.84) lacs.<br />
Fiscal 2007: Net cash from financing activities was Rs. (1,915.04) lacs in fiscal year 2007 which was primarily<br />
proceed received from long term borrowings of Rs. 130.11 lacs and repayment of short term borrowing of Rs.<br />
(227.89) lacs and partially offset by interest payment of Rs. (1,817.26) lacs.<br />
Fiscal 2006: Net cash from financing activities was Rs. (743.94) lacs in fiscal year 2006 which was primarily for<br />
proceed received on account of issue of equity shares of our Company of Rs. 1,219.99 lacs, net proceeds from<br />
long term borrowing of Rs. 884.84 lacs, proceeds from short term borrowings of Rs. (812.90) lacs and partially<br />
offset by interest payment of Rs. (2,035.87) lacs<br />
Fiscal 2005: Net cash from financing activities was Rs. 255.56 lacs in fiscal year 2005 which was primarily for<br />
proceed received on account of issue of equity shares of our Company of Rs. 1487.88 lacs, proceeds from long<br />
153
term borrowing of Rs. (503.41) lacs, proceeds from short term borrowings of Rs. 797.89 lacs and partially offset<br />
by interest payment of Rs. (2,251.82) lacs.<br />
Fiscal 2004: Net cash from financing activities was Rs. (5,283.55) lacs in fiscal year 2004, which was primarily<br />
for net proceeds from long-term borrowings of Rs. (2,930.46) lacs, proceeds from short term borrowings of Rs.<br />
(207.62) lacs and partially offset by interest payment of Rs. (2,145.47) lacs.<br />
Market risk is the risk of loss related to adverse changes in market prices, including interest rate and foreign<br />
exchange rates of financial instruments. We are exposed to various types of market risks, in the normal course<br />
of business. For instance, we are exposed to market interest rates and operating expenses risks. The following<br />
discussion summarizes our exposure to different market risks.<br />
Unforeseen conditions<br />
Apart from the risks as disclosed under heading "Risk Factors" appearing on page viii of the draft Letter of<br />
Offer, there are no other known trends or uncertainties that have had or are expected to have a material adverse<br />
impact on revenue or income from continuing operations.<br />
Transactions with Related Parties<br />
We have certain transactions with our Promoter Group Companies. For details, please refer to the “Related<br />
Party Transactions” under the section titled “Financial Statement” beginning on page 113 of the draft Letter of<br />
Offer.<br />
Status of any publicly announced new products or business segment<br />
Other than as described in chapter titled “Business Overview” on page 31 of this Draft Letter of Offer, there are<br />
no new products or business segments.<br />
SIGNIFICANT DEVELOPMENTS SUBSEQUENT TO THE LAST FINANCIAL STATEMENT<br />
The Directors of the company confirm that in their opinion, no circumstances have arisen since the date of the<br />
last financial statements as disclosed in this Draft Letter of Offer and which materially and adversely affect the<br />
profitability of the Company, or the value of its assets or its ability to pay its liabilities within the next twelve<br />
months.<br />
154
SECTION VI – LEGAL AND OTHER INFORMATION<br />
OUTSTANDING LITIGATIONS, MATERIAL DEVELOPMENTS AND OTHER DISCLOSURES<br />
Except as stated below, there are no outstanding litigations, suits, civil or criminal prosecutions, proceedings<br />
before any judicial, quasi-judicial, arbitral or administrative tribunals, including pending proceedings for<br />
violation of statutory regulations or alleging criminal or economic offences or tax liabilities, penalties imposed<br />
in last five years against our Company, our Promoters, our Directors, our Subsidiary, our Promoter Group<br />
Entities that would have a material adverse effect on our business and there are no defaults, non-payments or<br />
overdue of statutory dues, institutional / bank dues and dues payable to holders of debentures or fixed deposits<br />
and arrears of cumulative preference shares that would have a material adverse effect on our business.<br />
Further, except as stated below, our Company, our Directors, our Subsidiary, our Promoter and Promoter Group<br />
Entities have not been declared as willful defaulters by the Reserve Bank of India, have not been debarred from<br />
dealing in securities and/or accessing capital markets by SEBI and no disciplinary action has been taken against<br />
them by SEBI or any stock exchanges.<br />
Note: In relation to Promoter Group entities, we have disclosed outstanding litigations only against the<br />
respective Group Entities, and not by the Promoter Group Entities, as these litigations by Promoter Group<br />
Entities are in relation to matters pertaining to their rights and liabilities, and have no bearing on the<br />
performance or otherwise of the issuer company. Further, in relation to one of our Promoter Group Entities, H &<br />
R Johnson (India) Limited, we have detailed litigations against that company of only Rs. 10/- lakhs and above,<br />
and cases below that amount have been stated in a summarized manner, putting in cumulative amount involved.<br />
Contingent liabilities<br />
As on March 31, 2008, contingent liabilities not provided for were as follows:<br />
Particulars<br />
As on March<br />
31, 2008<br />
Claims against the Company not acknowledged as debts 173.40<br />
Service Tax: - Penalty and interest demanded on technology transfer agreement between 486.00<br />
FPL and IOCL and vice versa. ST demand on goods transport service at Supreme Court<br />
Service Tax demand on Goods Transport Agency during the year 1997-98, departments 6.29<br />
appeals pending in Supreme Court<br />
Service tax credit denial on outward freight and canteen services 2005-06, 06-07 and 07-08 63.84<br />
Central Excise – Claims against the company on various issues pending at CESTAT / High 493.49<br />
Court / Supreme Court<br />
Customs: Methods of calculation of duty under notification 2 / 95 & other valuation issues 126.33<br />
Sales tax on Input use for Exports (1999-2000 and 2000-2001) 9.00<br />
Sales Tax on interest collected (1997-98 & 2000-01) CST levied in interest charges collected 4.40<br />
from customers<br />
Guarantee given by the Company 2813.00<br />
Total 4175.75<br />
155
PART I – OUTSTANDING LITIGATIONS INVOLVING OUR COMPANY<br />
A. Civil Cases<br />
Cases filed by our Company<br />
Sr.<br />
No.<br />
Parties<br />
1. Futura<br />
Polyesters<br />
Limited (the<br />
“Plaintiff”) v/s<br />
Gor Leather<br />
Industries<br />
Private Limited<br />
(the<br />
“Defendant”)<br />
2. Futura<br />
Polyesters<br />
Limited (the<br />
“Petitioner”) v/s<br />
Metroni Drugs<br />
Private Limited<br />
(the<br />
“Respondent”)<br />
3. Futura<br />
Polyesters<br />
Limited (the<br />
“Petitioner”) v/s<br />
M/s Premier<br />
Poly Coaters<br />
(the<br />
“Respondent ”)<br />
4. Indian Organic<br />
Chemicals<br />
Limited [now<br />
known as Futura<br />
Polyesters<br />
Limited] (the<br />
“Plaintiff”) v/s<br />
Ganan<br />
Industries Sales<br />
and Services<br />
Private Limited<br />
(the<br />
“Defendant”)<br />
5. Futura<br />
Polyesters<br />
Limited (the<br />
“Plaintiff”) v/s<br />
Unipon (India)<br />
Limited (the<br />
“Defendant”)<br />
6. Futura<br />
Polyesters<br />
Limited (the<br />
“Petitioner”) v/s<br />
Nutan Mills<br />
Limited (the<br />
“Respondent”)<br />
Authority<br />
before<br />
which<br />
pending<br />
High Court<br />
of<br />
Judicature<br />
at Bombay<br />
High Court<br />
of<br />
Judicature<br />
at Bombay<br />
High Court<br />
of<br />
Judicature<br />
at Kerala<br />
High Court<br />
of<br />
Judicature<br />
at Bombay<br />
High Court<br />
of<br />
Judicature<br />
at Bombay<br />
High Court<br />
of<br />
Judicature<br />
at Bombay<br />
Case<br />
Number<br />
Suit<br />
number<br />
688 of<br />
1998<br />
Company<br />
Petition<br />
number<br />
331 of<br />
1996<br />
Company<br />
Petition<br />
number 6<br />
of 1995<br />
Suit<br />
number<br />
4308 of<br />
1995<br />
Suit<br />
number<br />
3430 of<br />
1994<br />
Company<br />
Petition<br />
number<br />
64 of<br />
1993<br />
Brief Particulars of<br />
Suit/Appeal/Case/Notice/Proceeding<br />
This suit has been filed by the Plaintiff<br />
for the recovery of Rs. 21,51,478.50<br />
arising out of the alleged default in<br />
payment by the Defendant for the sale<br />
and delivery of the goods to the<br />
Defendant.<br />
This petition has been filed by the<br />
Petitioner for the winding up of the<br />
Respondent Company. The Petitioner has<br />
alleged that the Respondent is liable to<br />
pay a sum of Rs. 38,87,954.99 along with<br />
interest computed at the rate of 28% per<br />
annum on Rs. 25,33,436.41 arising due to<br />
the non - payment for the goods<br />
purchased by the Respondent.<br />
This petition has been filed by the<br />
Petitioner for the recovery of Rs.<br />
2,51,160 towards the alleged debt for the<br />
supply of goods.<br />
This suit has been filed by the Plaintiff<br />
for the recovery of Rs. 1,87,67,676.71.<br />
The Plaintiff alleges that the Defendant<br />
has misappropriated the amount to be<br />
recovered by the Defendant from one of<br />
its customers.<br />
This suit is filed by the Plaintiff for the<br />
recovery of Rs. 56,53,411 arising out of<br />
the alleged default of payment by the<br />
Defendant for the sale and delivery of the<br />
goods to the Defendant.<br />
This petition has been filed by the<br />
Petitioner for the recovery of Rs.<br />
74,98,880 towards the alleged debt<br />
outstanding towards the sale of Polyester<br />
Staple Fibre.<br />
Amount of<br />
claim<br />
involved (Rs.<br />
in lacs)<br />
21.51 and<br />
28% interest<br />
on principal<br />
amount of Rs.<br />
7,31,836 till<br />
payment<br />
38.87 and<br />
28% interest<br />
on principal<br />
amount of Rs.<br />
25,33,436.41<br />
till payment<br />
2.51<br />
187.67 and<br />
28% interest<br />
on principal<br />
amount of Rs.<br />
1,06,97,143<br />
till payment.<br />
56.53 and<br />
21% interest<br />
per annum on<br />
the principal<br />
amount of Rs.<br />
28,06,226 till<br />
payment or<br />
realisation.<br />
74.99<br />
156
7. Indian Organic<br />
Chemicals<br />
Limited [now<br />
Futura<br />
Polyesters<br />
Limited] (the<br />
“Plaintiff”) v/s<br />
Amrapali<br />
Industries<br />
Limited and Mr.<br />
Yashwant<br />
Amratlal<br />
Thakkar (the<br />
“Defendants”)<br />
8. Indian Organic<br />
Chemicals<br />
Limited [now<br />
Futura<br />
Polyesters<br />
Limited] (the<br />
“Plaintiff”) v/s<br />
Reliable<br />
Texturising<br />
Private Limited<br />
(the<br />
“Defendant”)<br />
9. Futura<br />
Polyesters<br />
Limited (the<br />
“Plaintiff”) v/s<br />
Chemstar<br />
Organics (India)<br />
Limited (the<br />
“Defendant”)<br />
10. Futura<br />
Polyesters<br />
Limited (the<br />
“Plaintiff”) v/s<br />
Libra Filaments<br />
(the<br />
“Defendant”)<br />
11. Futura<br />
Polyesters<br />
Limited and<br />
Innovassynth<br />
Technologies<br />
(India) Limited<br />
(the “Plaintiffs”)<br />
v/s Poly<br />
Finechem Inc,<br />
Polytech Fine<br />
Chemicals Inc<br />
and Mr. Subir K<br />
Chakraborty<br />
(the<br />
“Defendants”)<br />
City Civil<br />
Court,<br />
Ahmedabad<br />
Court of<br />
Civil Judge,<br />
Surat<br />
High Court<br />
of<br />
Judicature<br />
at Bombay<br />
High Court<br />
of<br />
Judicature<br />
at Bombay<br />
Superior<br />
Court, State<br />
of New<br />
Jersey,<br />
Passaic<br />
County,<br />
USA<br />
Summary<br />
Suit<br />
number<br />
2664 of<br />
1994<br />
Summary<br />
Suit<br />
number 5<br />
of 1992<br />
Summary<br />
Suit<br />
number<br />
500 of<br />
2005<br />
Original<br />
Suit<br />
number<br />
451<br />
PAS-L-<br />
4209-07<br />
This suit has been filed by the Plaintiff<br />
for the recovery of Rs. 11,37,169 arising<br />
out of the alleged default in payment by<br />
the Defendant for the sale and delivery of<br />
the goods to the Defendant.<br />
This suit has been filed by the Plaintiff<br />
for the recovery of Rs. 5,13,130 arising<br />
out of the alleged default in payment by<br />
the Defendant for the sale and delivery of<br />
the goods to the Defendant.<br />
This suit has been filed by the Plaintiff<br />
for the recovery of Rs. 20,72,521 arising<br />
out of the alleged default in payment by<br />
the Defendant for the sale and delivery of<br />
the goods to the Defendant.<br />
This suit has been filed by the Plaintiff<br />
for the recovery of Rs. 13,61,919.64<br />
arising out of the alleged default in<br />
payment by the Defendant for the sale<br />
and delivery of the goods to the<br />
Defendant.<br />
This suit has been filed by the Plaintiff<br />
for the recovery of 3,91,330 US $ arising<br />
out of the alleged default in payment by<br />
the Defendant for the sale and delivery of<br />
the goods to the Defendant.<br />
11.37 and<br />
24% interest<br />
per annum till<br />
the date of<br />
realisation<br />
5.13 and 18%<br />
interest per<br />
annum on the<br />
principal<br />
amount of Rs.<br />
3,89,010 till<br />
payment or<br />
realisation.<br />
20.73 and<br />
24% interest<br />
per annum till<br />
the date of<br />
realisation<br />
13.62 and<br />
18% interest<br />
per annum on<br />
the principal<br />
amount of Rs.<br />
8,88,914 till<br />
payment or<br />
realisation.<br />
3,91,330 US<br />
$ and<br />
2,12,000 US<br />
$ as penalties<br />
and interest<br />
Cases filed against our Company<br />
Sr.<br />
No.<br />
Parties<br />
Authority<br />
before<br />
which<br />
pending<br />
Case<br />
Number<br />
Brief Particulars of<br />
Suit/Appeal/Case/Notice/Proceeding<br />
Amount of<br />
claim<br />
involved<br />
(Rs. in<br />
157
1. Parikh<br />
Enterprises<br />
Limited (the<br />
“Plaintiff”) v/s<br />
Indian Organic<br />
Chemicals<br />
Limited [now<br />
Futura<br />
Polyesters<br />
Limited] (the<br />
“Defendant”)<br />
2. Ganan<br />
Industrial Sales<br />
and Services<br />
Limited (the<br />
“Plaintiff”) v/s<br />
Indian Organic<br />
Chemicals<br />
Limited<br />
Futura<br />
Polyesters<br />
Limited]<br />
[now<br />
(the<br />
“Defendant”)<br />
3. Canara Bank<br />
(the “Plaintiff”)<br />
v/s Indian<br />
Organic<br />
Chemicals<br />
Limited [now<br />
Futura<br />
polyesters<br />
Limited] and<br />
M/s Atul<br />
Transport<br />
Company (the<br />
“Defendants”)<br />
4. Bank of India<br />
(the<br />
“Applicant”)<br />
v/s M/s. Enarai<br />
Finance<br />
others<br />
including<br />
Futura<br />
Polyesters<br />
Limited<br />
and<br />
as<br />
Defendant no. 5<br />
(the<br />
“Defendants”)<br />
5. R.K. Gupta (the<br />
“Plaintiff”) v/s<br />
Futura<br />
Polyesters<br />
Limited<br />
through Mr.<br />
S.B.Ghia, Mr.<br />
S. Rangarajan,<br />
Mr. M.D. Dalal<br />
and Mr. R.B.<br />
Court of<br />
Civil Judge,<br />
Ahmedabad<br />
High Court<br />
of<br />
Judicature<br />
at Bombay<br />
High Court<br />
of<br />
Judicature<br />
at Bombay<br />
Debt<br />
Recovery<br />
Tribunal,<br />
Pune<br />
Court<br />
District<br />
Judge,<br />
Hazari<br />
Courts,<br />
Delhi<br />
of<br />
Tis<br />
Summary<br />
Suit<br />
number 677<br />
of 1996<br />
Suit<br />
number<br />
3841 of<br />
1995<br />
Suit<br />
number<br />
4287 of<br />
1994<br />
Original<br />
Application<br />
number 413<br />
P 2001<br />
Suit<br />
number 266<br />
of 2007<br />
This suit has been filed by the Plaintiff for<br />
the recovery of Rs. 79,249 arising out of<br />
the alleged default in payment by the<br />
Defendant for the sale and delivery of the<br />
goods to the Defendant.<br />
This suit has been filed by the Plaintiff for<br />
the recovery of Rs. 41,70,062 arising out<br />
of alleged default in payment of agency<br />
commission by the Defendant for the<br />
canvassing services rendered by the<br />
Plaintiff.<br />
This suit has been filed by the Plaintiff for<br />
the recovery of Rs. 3,24,823 arising out of<br />
alleged default in payment by the<br />
Defendant No.1 to the Plaintiff for the<br />
goods sold and delivered to the<br />
Defendant no. 1 by the Defendant No. 2<br />
under the 11 supply bills discounted with<br />
and purchased by the Plaintiff.<br />
This suit has been filed as per the<br />
provisions of Recovery of Debts due to<br />
Banks and Financial Institutions Act. The<br />
Applicant has filed a suit against Enarai<br />
Finance Limited. Futura Polyesters<br />
Limited (Defendant No. 5) had availed<br />
lease finance facilities from Enarai<br />
Finance Limited for its plant in Chennai.<br />
The repayment of lease finance facilities<br />
was scheduled to be distributed in 18<br />
installments of Rs. 14.12 lacs together<br />
with an amount of Rs 1.5 crores<br />
commencing from July 1997 to August<br />
2002. Defendant No. 5 has fully<br />
discharged its liability to Enarai Finance<br />
Limited and has therefore contested the<br />
claim made by the Plaintiff.<br />
This suit has been filed by the Plaintiff for<br />
declaration and the recovery of Rs.<br />
7,50,000 arising out of the alleged unfair<br />
dismissal of the Plaintiff by the Defendant<br />
Company<br />
lacs)<br />
0.79 and<br />
18%<br />
interest per<br />
annum till<br />
the date of<br />
payment or<br />
realisation<br />
41.70 and<br />
18%<br />
interest per<br />
annum on<br />
the<br />
principal<br />
amount of<br />
Rs.<br />
29,06,371<br />
till payment<br />
or<br />
realisation.<br />
3.25 and<br />
18%<br />
interest per<br />
annum<br />
the<br />
principal<br />
amount<br />
on<br />
of<br />
Rs.<br />
2,36,100 till<br />
the date of<br />
payment or<br />
realization.<br />
No<br />
monetary<br />
liability for<br />
our<br />
Company<br />
7.50 and<br />
12%<br />
interest per<br />
annum till<br />
the date of<br />
payment or<br />
realization<br />
158
Raheja (the<br />
“Defendants”)<br />
6. Ms. Roopinder<br />
Singh (the<br />
“Plaintiff”) v/s<br />
Futura<br />
Polyesters<br />
Limited (the<br />
“Defendant”)<br />
7. Ms. Roopinder<br />
Singh (the<br />
“Plaintiff”) v/s<br />
Futura<br />
Polyesters<br />
Limited (the<br />
“Defendant”)<br />
8. Mr. Jatinder<br />
Singh (the<br />
“Plaintiff”) v/s<br />
Futura<br />
Polyesters<br />
Limited (the<br />
“Defendant”)<br />
Court of<br />
District<br />
Judge, New<br />
Delhi<br />
Court of<br />
District<br />
Judge, New<br />
Delhi<br />
Court of<br />
District<br />
Judge, New<br />
Delhi<br />
Suit<br />
number 64<br />
of 2008<br />
Suit<br />
number 65<br />
of 2008<br />
Suit<br />
number 66<br />
of 2008<br />
This suit has been filed by the Plaintiff for<br />
ejection of the Defendant from the<br />
property situated at flat number 511<br />
having an area 585 square feet, 5th Floor,<br />
Gagan Deep, 12, Rajendra Place, New<br />
Delhi - 110008 belonging to the Plaintiff.<br />
The plaintiff has further prayed for the<br />
recovery of mesne profits / damages for<br />
the use and occupation of the aforesaid<br />
property and for permanent injunction<br />
restraining the Defendant from possession<br />
of the aforesaid property.<br />
This suit has been filed by the Plaintiff for<br />
ejection of the Defendant from the<br />
property situated at flat number 509 and<br />
510 having an area 366 square feet each,<br />
5th Floor, Gagan Deep, 12, Rajendra<br />
Place, New Delhi - 110008 belonging to<br />
the Plaintiff. The Plaintiff has further<br />
prayed for the recovery of mesne profits /<br />
damages for the use and occupation of the<br />
aforesaid property and for permanent<br />
injunction restraining the Defendant from<br />
possession of the aforesaid property.<br />
This suit has been filed by the Plaintiff for<br />
ejection of the Defendant from the<br />
property situated at flat number 507<br />
having an area 443 square feet, 5th Floor,<br />
Gagan Deep, 12, Rajendra Place, New<br />
Delhi - 110008 belonging to the Plaintiff.<br />
The Plaintiff has further prayed for the<br />
recovery of mesne profits / damages for<br />
the use and occupation of the aforesaid<br />
property and for permanent injunction<br />
restraining the Defendant from possession<br />
of the aforesaid property.<br />
1.93 and<br />
24%<br />
interest per<br />
annum till<br />
the date of<br />
payment or<br />
realisation<br />
2.43 and<br />
24%<br />
interest per<br />
annum till<br />
the date of<br />
payment or<br />
realisation<br />
1.47 and<br />
24%<br />
interest per<br />
annum till<br />
the date of<br />
payment or<br />
realisation<br />
B. Criminal Cases<br />
Cases filed by our Company<br />
All the complaints as stated below have been filed under Section 138 of Negotiable Instruments Act, 1881<br />
Sr.<br />
No.<br />
Parties<br />
1. Indian Organic<br />
Chemicals<br />
Limited [now<br />
Futura Polyesters<br />
Limited] (the<br />
“Complainant”)<br />
v/s M/s Venfarm<br />
Agencies, Mr.<br />
Nakula Sambasiva<br />
Rao, Mrs.<br />
Chaluvadi Sita<br />
Mahalaxmi<br />
Authority<br />
before<br />
which<br />
pending<br />
Additional<br />
Chief<br />
Metropolitan<br />
Magistrate at<br />
Mumbai<br />
Case<br />
Number<br />
Criminal<br />
Complaint<br />
number<br />
948/S of<br />
2002<br />
Brief Particulars of<br />
Suit/Appeal/Case/Notice/Proceeding<br />
The Complainant in this complaint has<br />
alleged that the cheques issued by the<br />
Accused towards the part payment of the<br />
goods were dishonored<br />
Amount<br />
of claim<br />
involved<br />
(Rs. in<br />
lacs)<br />
9.00<br />
159
Kumari and Mr.<br />
Irri Venkata<br />
Ramana Rao, (the<br />
“Accused”)<br />
2. Indian Organic<br />
Chemicals<br />
Limited [now<br />
Futura Polyesters<br />
Limited] (the<br />
“Complainant”)<br />
v/s M/s Venfarm<br />
Agencies, Mr.<br />
Nakula Sambasiva<br />
Rao, Mrs.<br />
Chaluvadi Sita<br />
Mahalaxmi<br />
Kumari and Mr.<br />
Irri Venkata<br />
Ramana Rao, (the<br />
“Accused”)<br />
3. Indian Organic<br />
Chemicals<br />
Limited [now<br />
Futura Polyesters<br />
Limited] (the<br />
“Complainant”)<br />
v/s Mr. P. Kainiki<br />
Reddy, (the<br />
“Accused”)<br />
4. Futura Polyesters<br />
Limited (the<br />
“Applicant”) v/s<br />
Libra Filaments,<br />
Omprakash Jogani<br />
Lalit Joganiand<br />
the State of<br />
Maharashtra (the<br />
“Respondent”)<br />
Additional<br />
Chief<br />
Metropolitan<br />
Magistrate at<br />
Mumbai<br />
Judicial<br />
Magistrate<br />
First Class at<br />
Khalpur<br />
High Court<br />
of Judicature<br />
at Bombay<br />
Criminal<br />
Complaint<br />
number<br />
947/S of<br />
2002<br />
Criminal<br />
Complaint<br />
number 803<br />
of 2001<br />
Criminal<br />
Application<br />
number<br />
2424 of<br />
2000<br />
The Complainant in this complaint has<br />
alleged that the cheques issued by the<br />
Accused towards the part payment of the<br />
goods were dishonored.<br />
The Complainant in this complaint has<br />
alleged that the cheques issued by the<br />
Accused towards the part payment of the<br />
goods were dishonored<br />
This Application has been filed by the<br />
Applicant against the order dated May<br />
25, 2000 passed by the Metropolitan<br />
Magistrate acquitting the respondents<br />
number 1 to 3 for the alleged dishonor of<br />
cheques issued by the respondent<br />
number 1.<br />
5.00<br />
14.69<br />
16.00<br />
160
C. Sales Tax<br />
Cases filed by our Company<br />
Sr.<br />
No.<br />
Parties<br />
1. Futura<br />
Polyesters<br />
Limited (the<br />
“Appellant”)<br />
v/s.<br />
Commercial<br />
Tax Officer,<br />
Chennai (the<br />
“Respondent”)<br />
2. Futura<br />
Polyesters<br />
Limited (the<br />
“Appellant”)<br />
v/s.<br />
Commercial<br />
Tax Officer,<br />
Chennai (the<br />
“Respondent”)<br />
3. Futura<br />
Polyesters<br />
Limited (the<br />
“Appellant”)<br />
v/s.<br />
Commercial<br />
Tax Officer,<br />
Chennai (the<br />
“Respondent”)<br />
4. Futura<br />
Polyesters<br />
Limited (the<br />
“Applicant ”)<br />
v/s<br />
Commercial<br />
Tax Officer,<br />
Chennai (the<br />
“Respondent”)<br />
Authority<br />
before which<br />
pending<br />
Assistant<br />
Commissioner<br />
of<br />
Commercial<br />
Taxes,<br />
Chennai<br />
Assistant<br />
Commissioner<br />
of<br />
Commercial<br />
Taxes,<br />
Chennai<br />
Assistant<br />
Commissioner<br />
of<br />
Commercial<br />
Taxes,<br />
Chennai<br />
Deputy<br />
Commissioner<br />
of<br />
Commercial<br />
Taxes<br />
Case<br />
Number<br />
Appeal<br />
number AP<br />
10/2008 for<br />
the<br />
Assessment<br />
Year 2003-<br />
2004<br />
Appeal<br />
number AP<br />
11/2008 for<br />
the<br />
Assessment<br />
Year 2004-<br />
2005<br />
Appeal<br />
number AP<br />
12/2008 for<br />
the<br />
Assessment<br />
Year 2005-<br />
2006<br />
Revision<br />
Application<br />
number RP<br />
10/2008 for<br />
the<br />
Assessment<br />
Year 2006-<br />
2007<br />
Brief Particulars of<br />
Suit/Appeal/Case/Notice/Proceeding<br />
This appeal has been filed against the<br />
notice of demand dated March 12, 2008<br />
issued by the Respondent. The Appellant<br />
has disputed the imposition of entire<br />
penalty of Rs. 6,61,661 for the alleged<br />
delay in the payment of sales tax and<br />
filing of monthly returns under section 12<br />
(3) (c) of TNGST Act read with section 9<br />
(2-A) of CST Act by Commercial Tax<br />
Officer.<br />
This appeal has been filed against the<br />
notice of demand dated March 12, 2008<br />
issued by the Respondent. The Appellant<br />
has disputed the imposition of entire<br />
penalty of Rs. 9,78,697 for the alleged<br />
delay in the payment of sales tax and<br />
filing of monthly returns under section 12<br />
(3) (c) of TNGST Act read with section 9<br />
(2-A) of CST Act by Commercial Tax<br />
Officer.<br />
This appeal has been filed against the<br />
notice of demand dated March 12, 2008<br />
issued by the Respondent The Appellant<br />
has disputed the imposition of entire<br />
penalty and interest on sales tax<br />
amounting to Rs. 5,04,641 for the alleged<br />
delay in payment of sales tax and filing of<br />
monthly returns under Section 12(3)(c) of<br />
the Tamil Nadu General Sales Tax, 1959<br />
read with Section 9(2-A) of Central Sales<br />
Tax, 1956.<br />
This revision application has been filed<br />
against the order dated December 31,<br />
2007 passed by the Respondent on<br />
account of the claim of Input Tax Credit<br />
(“ITC”) of Rs. 42,40,824 being restricted<br />
to Rs. 8,31,758 on grounds inter alia of<br />
non-submission of bills, reversal of ITC<br />
on capital goods and on PET Bottle scrap<br />
content in Finished goods/semi-finished<br />
goods held in stock as on December 31,<br />
2006.<br />
Amount<br />
of claim<br />
involved<br />
(Rs. in<br />
lacs)<br />
6.61<br />
9.78<br />
5.05<br />
34.09<br />
Cases filed against our Company<br />
Sr.<br />
No.<br />
Parties<br />
Authority<br />
before<br />
which<br />
pending<br />
Case<br />
Number<br />
Brief Particulars of<br />
Suit/Appeal/Case/Notice/Proceeding<br />
Amount<br />
of claim<br />
involved<br />
(Rs. in<br />
161
1. Commercial<br />
Tax Officer,<br />
Chennai (the<br />
“Assessor”)<br />
v. Futura<br />
Polyesters<br />
Limited (the<br />
“Assessee”)<br />
2. Commercial<br />
Tax Officer,<br />
Chennai (the<br />
“Assessor”)<br />
v. Futura<br />
Polyesters<br />
Limited (the<br />
“Assessee”)<br />
3. Commercial<br />
Tax Officer,<br />
Manali v/s.<br />
Futura<br />
Polyesters<br />
Limited<br />
Commercial<br />
Tax Officer,<br />
Chennai<br />
Commercial<br />
Tax Officer,<br />
Chennai<br />
Sales<br />
Appellate<br />
Tribunal<br />
Tax<br />
Assessment<br />
number<br />
49999 for<br />
the<br />
Assessment<br />
Year 2002-<br />
2003<br />
Assessment<br />
number<br />
1080067 for<br />
the<br />
Assessment<br />
Year 2002-<br />
2003<br />
NA<br />
This notice of demand dated March 12, 2008<br />
is issued by the Assessor imposing a penalty<br />
of Rs. 14,906. The Assessor vide the notice<br />
of demand has imposed penalty and interest<br />
on sales tax under Section 12(3)(c) of the<br />
Tamil Nadu General Sales Tax, 1959 read<br />
with Section 9(2-A) of Central Sales Tax Act,<br />
1956 for the alleged delay in payment of<br />
sales tax and filing of monthly returns<br />
The Assessor has issued the present notice of<br />
demand dated March 12, 2008 for the alleged<br />
non-payment of additional tax amounting to<br />
Rs. 10,86,499 under Section 2(1)(aa) of the<br />
Tamil Nadu Additional Sales Tax, 1970.<br />
The Commercial Tax Officer states that the<br />
interest collected from the customers for late<br />
payment and for the credit period is<br />
chargeable to sales tax and the same has to be<br />
paid by our Company.<br />
lacs)<br />
0.15<br />
10.86<br />
5.00<br />
4. Commercial<br />
Tax Officer,<br />
Manali v/s.<br />
Futura<br />
Polyesters<br />
Limited<br />
Sales Tax<br />
Appellate<br />
Tribunal<br />
NA<br />
The differential sales tax is demanded on the<br />
raw material purchased within the state and<br />
the finished goods (manufactured from the<br />
raw material so purchased) sold outside the<br />
state.<br />
9.00<br />
D. Export related<br />
Cases against our Company<br />
Sr.<br />
No.<br />
Parties<br />
1. Foreign<br />
Trade<br />
Development<br />
Officer v/s<br />
Indian<br />
Organic<br />
Chemicals<br />
Limited<br />
[now Futura<br />
Polyesters<br />
Limited],<br />
Mr. Shyam<br />
Bhupatirai<br />
Ghia ,<br />
Sharad<br />
Shreepad<br />
Marathe,<br />
Nikhil Ghia<br />
and Mukund<br />
Dharamdas<br />
Dalal (the<br />
“Company”)<br />
Authority<br />
before<br />
which<br />
pending<br />
Officer of<br />
Joint<br />
Director<br />
General<br />
of Foreign<br />
Trade<br />
Show Cause Number Brief Particulars of<br />
Suit/Appeal/Case/Notice/Proceeding<br />
Show cause notice<br />
number<br />
030100200093AM09/20<br />
It has been alleged that our Company<br />
has not utilisied the goods imported<br />
against the export license. It has been<br />
further alleged that the license has<br />
been obtained on the basis of<br />
misrepresentation and mis-declaration<br />
of facts. Our Company has been asked<br />
to justify why an action to impose<br />
fiscal penalty should not be taken on<br />
our Company and its directors under<br />
Section 11 of the Foreign Trade<br />
(Development and Regulation) Act,<br />
1992.<br />
Amount<br />
involved<br />
(Rs. in<br />
Lacs)<br />
Not<br />
quantifiable<br />
162
E. Income Tax<br />
Cases filed by our Company<br />
Sr.<br />
No.<br />
Parties<br />
1. Indian Organic<br />
Chemicals<br />
Limited [now<br />
Futura<br />
Polyesters<br />
Limited] (the<br />
“Applicant”) v/s<br />
the<br />
Commissioner<br />
of Income Tax<br />
(the<br />
“Respondent”)<br />
2. Indian Organic<br />
Chemicals<br />
Limited [now<br />
Futura<br />
Polyesters<br />
Limited] (the<br />
“Appellant”) v/s<br />
Assistant<br />
Commissioner<br />
of Income Tax<br />
(the<br />
“Respondent”)<br />
Authority<br />
before which<br />
pending<br />
High Court of<br />
Judicature at<br />
Bombay<br />
Income Tax<br />
Appellate<br />
Tribunal,<br />
Mumbai<br />
Case Number Brief Particulars of<br />
Suit/Appeal/Case/Notice/Proceeding<br />
Reference Application<br />
number 1533/Bom/1991<br />
for the Assessment Year<br />
1981-82<br />
Appeal number<br />
3734/M/2004 for the<br />
Assessment Year 1999-<br />
2000<br />
This reference application has been filed<br />
by the Applicant for seeking opinion as<br />
to whether the commission of Rs.<br />
1,02,000 paid to the directors is to be<br />
treated as part of salary for the purpose<br />
of disallowance under Section 40(c) of<br />
the Income Tax Act, 1961.<br />
This appeal has been filed against the<br />
order dated March 9, 2004 passed by the<br />
Commissioner of Income Tax<br />
(Appeals)on the following grounds:<br />
1. Addition of unutilised Modvat<br />
Credit amounting to Rs. 3,74,89,699<br />
and amount of Rs. 1,544 received as<br />
contribution to Labour Welfare<br />
Fund;<br />
2. Allowance of unclaimed<br />
depreciation amounting to Rs.<br />
9,96,17,284;<br />
3. Addition of Rs. 8,50,30,000 and Rs.<br />
8,75,00,000 as revenue receipt and;<br />
4. Disallowance of provision for<br />
doubtful debts amounting to Rs.<br />
3,87,72,851<br />
5. Disallowance of advances of Rs.<br />
51,54,070<br />
6. Disallowance of 5% of Motor Car<br />
expenses<br />
7. Disallowance of prior period<br />
expenses of Rs. 1,02,04,000<br />
3. Futura<br />
Polyesters<br />
Limited (the<br />
“Appellant”) v/s<br />
Additional<br />
Commissioner<br />
of Income Tax,<br />
Mumbai (the<br />
“Respondent”)<br />
Income<br />
Appellate<br />
Tribunal,<br />
Mumbai<br />
Tax<br />
The Appeal number for<br />
the Assessment Year<br />
2000-2001 is not<br />
available as the same is<br />
at pre-admission stage<br />
This appeal has been filed against the<br />
order dated August 5, 2003 passed by the<br />
Commissioner of Income Tax<br />
(Appeals)on the following grounds:<br />
1. Addition of unutilised Modvat<br />
Credit amounting to Rs.<br />
3,05,63,493;<br />
2. Allowance of unclaimed<br />
depreciation amounting to Rs.<br />
163
7,48,28,671;<br />
3. Disallowance of penalty under<br />
Employees State Insurance Act<br />
amounting to Rs. 1,54,365;<br />
4. Disallowance as capital receipt of<br />
non-compete compensation of Rs.<br />
16,12,00,000; and<br />
5. Disallowance of provision of<br />
doubtful debts of Rs. 3,00,84,414;<br />
6. Disallowance of 5% of motor car<br />
expenses;<br />
7. Disallowance of Rs. 1,02,04,000<br />
being payment for the prior period<br />
expenses;<br />
8. Disallowance under Section<br />
36(1)(v)(a) of the Income Tax Act,<br />
1961 and<br />
4. Futura<br />
Polyesters<br />
Limited (the<br />
“Appellant”) v/s<br />
Additional<br />
Commissioner<br />
of Income Tax,<br />
Mumbai (the<br />
“Respondent”)<br />
Income<br />
Appellate<br />
Tribunal,<br />
Mumbai<br />
Tax<br />
Appeal number<br />
3735/M/04 for the<br />
Assessment Year 1998-<br />
1999<br />
9. Disallowance of deduction for<br />
export profits while computing the<br />
book-profit under Section 115J of<br />
the Income Tax Act, 1961.<br />
This appeal has been filed by the<br />
Appellant against the order dated March<br />
9, 2004 passed by the Commissioner of<br />
Income Tax (Appeals) on the following<br />
grounds:<br />
1. Addition of the unutilised Modvat<br />
Credit amounting to Rs.<br />
3,91,35,775;<br />
2. Allowance of the unclaimed<br />
depreciation amounting to Rs.<br />
10,56,07,869;<br />
3. Disallowance of repair and<br />
maintenance expenses of Rs.<br />
4,18,269 to be treated as revenue<br />
expenditure;<br />
4. Disallowance of club expenses<br />
amounting to Rs. 16,905;<br />
5. Disallowance of 5% of motor car<br />
expenses ;<br />
6. Disallowance of provision of<br />
doubtful debts amounting to Rs.<br />
32,01,424 and<br />
5. Futura<br />
Polyesters<br />
Limited (the<br />
“Appellant”) v/s<br />
Commissioner<br />
of Income Tax<br />
(Appeals),<br />
Mumbai<br />
The Appeal number for<br />
the Assessment Year<br />
2005-2006 is not<br />
available as the same is<br />
7. Disallowance of Rs. 10,82,447<br />
under Section 43B of the Income<br />
Tax Act, 1961.<br />
This appeal has been filed against the<br />
order dated December 31, 2007 passed<br />
by the Deputy Commissioner of Income<br />
Tax on the following grounds:<br />
164
Deputy<br />
Commissioner<br />
of Income Tax,<br />
Mumbai (the<br />
“Respondent”)<br />
at pre-admission stage<br />
1. An amount of Rs. 18.33 lacs is<br />
considered as income being credit<br />
balances not written off at the year<br />
end<br />
2. Disallowance of Rs. 145.43 lacs<br />
being interest accrued on secured<br />
loan under Section 43B of the<br />
Income Tax Act, 1961.<br />
3. An amount of Rs. 3.19 lacs is<br />
considered as income being the<br />
credit balance not written off at the<br />
year end.<br />
6. Futura<br />
Polyesters<br />
Limited (the<br />
“Appellant”) v/s<br />
Deputy<br />
Commissioner<br />
of Income Tax,<br />
Mumbai (the<br />
“Respondent”)<br />
7. Futura<br />
Polyesters<br />
Limited (the<br />
“Appellant”) v/s<br />
Deputy<br />
Commissioner<br />
of Income Tax,<br />
Mumbai (the<br />
“Respondent”)<br />
Deputy<br />
Commissioner<br />
of Income Tax<br />
(Appeals),<br />
Mumbai<br />
Income Tax<br />
Appellate<br />
Tribunal,<br />
Mumbai<br />
Appeal number<br />
CIT(A)/V/5(1)/121/06-<br />
07 for the Assessment<br />
Year 2003-2004<br />
Appeal number<br />
4705/Mum-2006 for the<br />
Assessment Year 2002-<br />
2003<br />
4. An amount of Rs. 26.58 lacs is<br />
considered as income being the<br />
amounts payable at the year end.<br />
This appeal has been filed against the<br />
order dated February 27, 2005 passed by<br />
the Deputy Commissioner of Income<br />
Tax on the following grounds:<br />
1. Disallowance of prior period<br />
expenses of Rs. 33,43,346 and<br />
2. Rejecting the Appellant’s claim for<br />
depreciation of Rs. 38,12,00,619<br />
and allowing it to the extent of Rs.<br />
28,21,93,101.<br />
This appeal has been filed against the<br />
order dated March 10, 2005 passed by<br />
the Deputy Commissioner of Income<br />
Tax (Appeals) on the following<br />
grounds:<br />
1. Disallowance of provision of<br />
doubtful debts and advances of Rs.<br />
1,83,34,650; and<br />
2. Disallowance of prior period<br />
expenses of Rs. 40,41,790.<br />
8. Futura<br />
Polyesters<br />
Limited (the<br />
“Appellant”) v/s<br />
Deputy<br />
Commissioner<br />
of Income Tax,<br />
Mumbai (the<br />
“Respondent”)<br />
Income<br />
Appellate<br />
Tribunal,<br />
Mumbai<br />
Tax<br />
Appeal number<br />
5596M/04 for the<br />
Assessment Year 2001-<br />
2002<br />
However, a penalty of Rs. 79,88,389 has<br />
been imposed vide order dated March<br />
31, 2008 for furnishing inaccurate<br />
particulars of income, against which<br />
appeal has been filed before the<br />
Commissioner of Income Tax (Appeals)<br />
and the same is pending.<br />
This appeal has been filed against the<br />
order dated June 09, 2004, passed by the<br />
Commissioner of Income Tax (Appeals)<br />
on the following grounds:<br />
1. Allowance of depreciation of Rs.<br />
10,09,95,134 not claimed by the<br />
Appellant<br />
2. Disallowance of the provision for<br />
doubtful debts and advances of Rs.<br />
2,56,98,381<br />
165
3. Disallowance of prior period<br />
expenses of Rs. 35,75,454<br />
9. Indian Organic<br />
Chemicals<br />
Limited [now<br />
Futura<br />
Polyesters<br />
Limited] (the<br />
“Appellant”) v/s<br />
Deputy<br />
Commissioner<br />
of Income Tax<br />
(the<br />
“Respondent”)<br />
Income<br />
Appellate<br />
Tribunal<br />
Tax<br />
The Appeal number for<br />
the Assessment Year<br />
1989-1990 is not<br />
available as the same is<br />
at pre-admission stage<br />
and our Company has<br />
not received any notice<br />
of hearing.<br />
4. Disallowance of of Rs. 1,02,92,681<br />
being (eligible) export profits under<br />
Section 80HHC while computing<br />
the book profit under section 115 JA<br />
of the Income Tax Act, 1961.<br />
This appeal has been filed against the<br />
order dated July 07, 1992 passed by the<br />
Commissioner of Income Tax (Appeals)<br />
on the following grounds:<br />
1. Disallowance of conference<br />
expenses amounting to Rs. 7,849<br />
2. Disallowance of R&D Agro<br />
expenses of Rs. 8,584<br />
3. Disallowance of payment clubs<br />
amounting to Rs. 19,837<br />
4. Disallowance of expenses of Rs.<br />
5,86,789 under Section 37(4) of the<br />
Income Tax Act, 1961 (“Act”)<br />
5. Disallowance of repair expenses of<br />
Rs. 25,209 under Section 37(4) of<br />
the Act<br />
6. Disallowance of rent expenses of<br />
Rs. 2,36,760 and insurance expenses<br />
of<br />
Rs. 274 under<br />
Section 37(4) of the Act<br />
7. Disallowance of training expenses<br />
of Rs. 20,951 under Section 37(4) of<br />
the Act<br />
8. Disallowance of Rs. 1,55,844 under<br />
Rule 6B of the Income Tax Rules,<br />
1962<br />
9. Disallowance of amounts of Rs.<br />
10,400, Rs. 29,854 and Rs. 18,000<br />
under Section 40A(9) of the Act<br />
10. Disallowance of Rs. 2,49,477 under<br />
Rule 6B of the Income Tax Rules,<br />
1962<br />
11. Disallowance of legal and<br />
professional fees of Rs. 15,000<br />
12. Disallowance of prior period<br />
expenses under Rs. 35,81,772<br />
13. Disallowed premium on redemption<br />
of Debentures of Rs. 74,69,000<br />
14. Disallowance for doubtful debts /<br />
advances amounting to Rs.<br />
2,60,43,718<br />
166
15. Disallowance in respect of purchase<br />
tax of Rs. 84,000<br />
16. Adding the provision for doubtful<br />
debts / avances of Rs. 2,60,43,718<br />
10. Futura<br />
Polyesters<br />
Limited (the<br />
“Appellant”) v/s<br />
Additional<br />
Commissioner<br />
of Income Tax<br />
(the<br />
“Respondent”)<br />
Income<br />
Appellate<br />
Tribunal,<br />
Mumbai<br />
Tax<br />
Appeal number ITA<br />
1841/M/2002 for the<br />
Assessment Year 1992-<br />
1993<br />
17. Disallowance of Rs. 1,63,73,976<br />
under proviso 4 to Section 115J<br />
(1A) of the Act.<br />
This appeal has been filed against the<br />
order dated October 18, 2002 passed by<br />
the Commissioner of Income Tax<br />
(Appeals) on the following grounds:<br />
1. Treatment of 25% of the<br />
disallowance under Rule 6B of<br />
Income Tax Rules, 1962 as not<br />
incurred exclusively for the<br />
business.<br />
2. Disallowance of Rs. 1538438 under<br />
Rule 6B of Income Tax Rules, 1962<br />
3. Disallowance of Rs. 971579 under<br />
Section 37(4) of the Income Tax<br />
Act, 1961 (“Act”)<br />
4. Disallowance of Rs. 14,37,240<br />
under Section 35(2)(ia) of the Act.<br />
5. Disallowance of notional interest of<br />
Rs. 15,29,700<br />
6. Disallowance of Rs. 7,49,535 under<br />
Section 37(2A) of the Act<br />
7. Disallowance of motor car expenses<br />
to the extent of 5% of such expenses<br />
8. Disallowance of provision for<br />
doubtful debts / advances of Rs.<br />
11,99,357<br />
9. Addition of interest on delayed<br />
payment of ESIC amounting to Rs.<br />
18,349<br />
10. Disallowance of Rs. 5,42,924 being<br />
payment made to Khopoli<br />
Municipal Corporation<br />
11. Disallowance of prior period<br />
expenses of Rs. 59,825<br />
Cases filed against our company<br />
Sr.<br />
No.<br />
Parties<br />
1. The Assistant<br />
Commissioner of<br />
Income Tax,<br />
Chennai (the<br />
Authority<br />
before<br />
which<br />
pending<br />
Income<br />
Tax<br />
Appellate<br />
Tribunal,<br />
Case Number Brief Particulars of<br />
Suit/Appeal/Case/Notice/Proceeding<br />
Appeal numbers<br />
357, 358, 359 and<br />
360 of 2008 for the<br />
Assessment Years<br />
These Appeals have been filed against order<br />
dated October 31, 2007 passed by the<br />
Commissioner of Income Tax (Appeals)<br />
holding that the relief under section 80HHC of<br />
167
“Appellant”) v/s<br />
Futura Polyesters<br />
Limited (the<br />
“Respondent”)<br />
2. Commissioner of<br />
Income Tax,<br />
Mumbai (the<br />
“Appellant”) v/s<br />
Futura Polyesters<br />
Limited (the<br />
“Respondent”)<br />
3. Deputy<br />
Commissioner of<br />
Income Tax,<br />
Mumbai (the<br />
“Appellant”) v/s<br />
Indian Organic<br />
Chemicals<br />
Limited [now<br />
Futura Polyesters<br />
Limited] (the<br />
“Respondent”)<br />
4. Deputy<br />
Commissioner of<br />
Income Tax,<br />
Mumbai (the<br />
“Appellant”) v/s<br />
Indian Organic<br />
Chemicals<br />
Limited [now<br />
Futura Polyesters<br />
Limited] (the<br />
“Respondent”)<br />
Chennai 1998-1999, 1999-<br />
2000, 2000-2001<br />
and 2001-2002.<br />
High Court<br />
of<br />
Judicature<br />
at Bombay<br />
Income<br />
Tax<br />
Appellate<br />
Tribunal,<br />
Mumbai<br />
Income<br />
Tax<br />
Appellate<br />
Tribunal,<br />
Mumbai<br />
Income Tax<br />
Appeal number<br />
949 of 2007 for the<br />
Assessment Years<br />
1985-86, 1986-87<br />
and 1987-88<br />
Appeal number<br />
1179/Mum/1998<br />
for the Assessment<br />
Year 1994-95<br />
Appeal number<br />
3799/Mum/1994<br />
for the Assessment<br />
Year 1990-91<br />
the Income Tax Act, 1961 has to be computed<br />
on the basis of book profits as against the<br />
normal computation of income.<br />
This appeal has been filed against the order<br />
dated August 25, 2006 passed by Income Tax<br />
Appellate Tribunal holding that the sales tax<br />
set-off does not come under the perview of<br />
Section 43B of the Income Tax Act, 1961.<br />
Further, the Appellant has raised questions of<br />
law on the scope and correct interpretation of<br />
Section 43B of the Income Tax Act, 1961 and<br />
the jurisdiction of the Tribunal in setting aside<br />
the disallowance of the sales tax set off made<br />
by the Assessing Officer under Section 43B of<br />
the Income Tax Act, 1961<br />
This appeal has been filed against the order<br />
dated November 28, 1997 passed by the Deputy<br />
Commissioner of Income Tax (Appeal),<br />
Mumbai on the following grounds:<br />
1. Allowance of the Respondent’s claim of<br />
Guest House expenses;<br />
2. Allowance of proportionate premium on<br />
redemption of debentures;<br />
3. Disallowance of the MODVAT addition.<br />
This appeal has been filed against the order<br />
dated March 11, 1994 passed by the Deputy<br />
Commissioner of Income Tax (Appeal) on the<br />
following grounds:<br />
1. Allowance of relief of Rs. 348,573 out of<br />
the total disallowance of Rs. 8,06,634<br />
under Section 37(4) of the Income Tax Act,<br />
1961;<br />
2. Allowance of relief of Rs. 1,62,924 out of<br />
the total disallowance of Rs. 549,383 under<br />
Rule 6D of the Income Tax Rules and<br />
5. Commissioner of<br />
Income Tax,<br />
Mumbai (the<br />
“Appellant”) v/s<br />
Indian Organic<br />
Chemicals<br />
Limited [now<br />
Futura Polyesters<br />
Limited] (the<br />
“Respondent”)<br />
High Court<br />
of<br />
Judicature<br />
at Bombay<br />
Appeal number<br />
1614 of 2005 for<br />
the Assessment<br />
Year 1997-98<br />
3. Disallowance of the addition made to part<br />
provision against premium on debentures<br />
Rs. 29,82,141.<br />
This appeal has been filed against the order<br />
dated April 1, 2005 passed by the Income Tax<br />
Appellate Tribunal. The Commissioner of<br />
Income Tax through this Appeal has sought the<br />
opinion of the High Court of Bombay, whether<br />
Income Tax Appellate Tribunal was right in<br />
confirming the decision of the Commissioner of<br />
Income Tax (Appeals) on the allowance of<br />
depreciation not claimed by the Respondent.<br />
F. Labour Cases<br />
Cases filed by our Company<br />
Sr.<br />
No.<br />
Parties<br />
Authority<br />
before<br />
which<br />
Case<br />
Number<br />
Brief Particulars of<br />
Suit/Appeal/Case/Notice/Proceeding<br />
Amount<br />
claimed<br />
(Rs.<br />
in<br />
168
1. Indian Organic<br />
Chemicals Limited<br />
[now Futura<br />
Polyesters Limited]<br />
(the “Appellant”)<br />
v/s Madras Metro<br />
General Workers<br />
Union,<br />
Government of<br />
Tamil Nadu, Naidu<br />
Engineering<br />
Corporation<br />
Limited, Mr.<br />
Ravindra<br />
(Contractor), Mr. K<br />
V S Mani<br />
(Contractor) and<br />
N.S.R. Raja<br />
Kumaran Brothers<br />
(the<br />
“Respondents”)<br />
2. Futura Polyesters<br />
Limited (the<br />
“Plaintiff”) v/s.<br />
The Chairman,<br />
Manali Town<br />
Panchayat, Palli<br />
Street, Manali,<br />
Chennai (the<br />
“Defendant”)<br />
3. The management<br />
of Futura<br />
Polyesters Limited<br />
(the “Petitioner”)<br />
v/s the Presiding<br />
Officer I-<br />
Additional Labour<br />
Court and Mr. A.<br />
Manoharan (the<br />
“Respondents”)<br />
4. The management<br />
of Futura<br />
Polyesters Limited<br />
(the “Petitioner”)<br />
v/s the Presiding<br />
Officer I-<br />
Additional Labour<br />
Court and Mr. A.<br />
Manoharan (the<br />
“Respondents”)<br />
pending<br />
High Court<br />
of<br />
Judicature<br />
at Madras<br />
District<br />
Munsif<br />
Court,<br />
Tiruvottiyur<br />
High Court<br />
of<br />
Judicature<br />
at Madras<br />
High Court<br />
of<br />
Judicature<br />
at Madras<br />
Writ<br />
appeal<br />
number<br />
1870 of<br />
2000<br />
Original<br />
Suit No.<br />
231 of<br />
2004<br />
Writ<br />
petition<br />
number<br />
23446 of<br />
2007<br />
Writ<br />
Petition<br />
number<br />
3758 and<br />
3760 of<br />
2008<br />
This writ appeal has been filed against<br />
the order dated July 14, 2000 passed by<br />
the High Court of Madras quashing the<br />
government order number 1873 dated<br />
October 27, 1989 wherein the contract<br />
labour system in the canteen of the<br />
Appellant was not prohibited.<br />
This suit has been filed against the<br />
Defendant alleging that the Defendant<br />
has attempted to trespass the properties<br />
of the Plaintiff situated at Chinnasekkadu<br />
and Sathanagadu Villages on September<br />
20, 2004 with a view to plant trees and<br />
fence in and around the aforesaid<br />
property.<br />
This writ petition has been filed against<br />
award dated May 10, 2007 passed in<br />
Complaint number 1 of 2007 directing<br />
the petitioner to reinstate the second<br />
respondent in service with backwages<br />
and attended benefits.<br />
This writ petition has been filed against<br />
the order passed by the first Respondent<br />
awarding a sum of Rs. 79,666 to the<br />
second Respondent.<br />
Lacs)<br />
Not<br />
quantifiable<br />
Not<br />
quantifiable<br />
Not<br />
quantifiable<br />
0.80<br />
Cases filed against our Company<br />
Sr.<br />
No.<br />
Parties<br />
1. Mr. M.<br />
Mahalingam (the<br />
“Petitioner”) v/s<br />
The State of Tamil<br />
Nadu, Municipal<br />
Administration and<br />
Authority<br />
before<br />
which<br />
pending<br />
High<br />
Court of<br />
Judicature<br />
at Madras<br />
Case<br />
Number<br />
Writ<br />
Petition<br />
number<br />
15644 of<br />
2007<br />
Brief Particulars of<br />
Suit/Appeal/Case/Notice/Proceeding<br />
The Petitioner has approached the Court<br />
under Article 226 of the Constitution.<br />
This petition is filed for an ad-interim<br />
injunction order restraining the second<br />
and fourth respondent from discharging<br />
the sewage water into the Sathanakadu<br />
Amount<br />
claimed<br />
(Rs. in<br />
Lacs)<br />
Not<br />
quantifiable<br />
169
Water Supply,<br />
Tamil Nadu<br />
Pollution Control<br />
Board,<br />
Commissioner of<br />
Thiruvotriyur<br />
Municipality (the<br />
“Respondents”) and<br />
Manali<br />
Petrochemicals<br />
Limited, Balmier<br />
Lawrie and<br />
Company Limited,<br />
Cetex<br />
Petrochemicals<br />
Limited, Futura<br />
Polyesters Limited<br />
and Kothari Sugars<br />
and Chemicals<br />
Limited (the<br />
“Proposed<br />
Respondents”)<br />
2. Mr. N.<br />
Chidambaram<br />
Kuttalam Pillai (the<br />
“Petitioner”) v/s<br />
Indian Organic<br />
Chemicals Limited<br />
(the “Respondent”)<br />
3. Mr. S. Kamaraj (the<br />
“Petitioner”) v.<br />
Futura Polyesters<br />
Limited (the<br />
“Respondents”)<br />
4. Mr. M. Pethurajan<br />
(the “Petitioner”) v.<br />
Futura Polyesters<br />
Limited (the<br />
“Respondents”)<br />
5. Mr. S. Jayaraj (the<br />
“Applicant”) v.<br />
Futura Polyesters<br />
Limited (the<br />
“Respondents”)<br />
Labour<br />
Court,<br />
Chennai<br />
Labour<br />
Court,<br />
Chennai<br />
Labour<br />
Court,<br />
Chennai<br />
Labour<br />
Court,<br />
Chennai<br />
Industrial<br />
Dispute<br />
number<br />
832 of 93<br />
Industrial<br />
Dispute<br />
number<br />
250 of<br />
2005<br />
Industrial<br />
Dispute<br />
number<br />
122 of<br />
2006<br />
Industrial<br />
Dispute<br />
number<br />
214 of<br />
2005<br />
Lake. The petitioner alleges that due to<br />
continuous silting of the lake, the villagers<br />
are deprived of storm water and the basic<br />
right for ground water recharge. The<br />
Petitioner has further alleged that the<br />
factories in the Manali Industrial Area<br />
have added to the difficulty by letting the<br />
effluents into the lake.<br />
This petition has been filed by the<br />
Petitioner alleging illegal termination of<br />
the services on the grounds of indiscipline<br />
and unauthorized absence from duty<br />
This petition has been filed by the<br />
Petitioner for declaring the dismissal of<br />
petitioner on the grounds of alleged<br />
absence from duty and management as<br />
unjustified and an unfair labour practice<br />
under Section 5 and 7 and Schedule 5 of<br />
the Industrial Dispute Act, 1947.<br />
This petition has been filed by the<br />
Petitioner against the order dated August<br />
29, 2005 pertaining to the dismissal of the<br />
Petitioner from the employment on the<br />
grounds that the dismissal is allegedly<br />
disproportionate to the alleged<br />
misconduct.<br />
This application has been filed against the<br />
Respondent alleging illegal termination of<br />
services and subsequent alleged violation<br />
of the provisions of the Industrial<br />
Disputes Act, 1947 relating to unfair<br />
labour practice<br />
Not<br />
quantifiable<br />
Not<br />
quantifiable<br />
Not<br />
quantifiable<br />
Not<br />
quantifiable<br />
G. Central Excise<br />
Cases filed by our Company<br />
Sr.<br />
No.<br />
Parties<br />
1. Indian Organic<br />
Chemicals<br />
Limited (the<br />
“Petitioner”) v/s<br />
Customs,<br />
Excise and Gold<br />
Authority<br />
before which<br />
pending<br />
High Court of<br />
Judicature at<br />
Delhi<br />
Case<br />
Number<br />
Civil Writ<br />
Petition<br />
number<br />
3738 of<br />
1991<br />
Brief Particulars of<br />
Suit/Appeal/Case/Notice/Proceeding<br />
The Petitioner in this case had claimed<br />
the benefit under Notification No. 43/80<br />
which exempted it, from the duty under<br />
Central Excise Act. The same was<br />
rejected by the Assistant Collector and<br />
the Petitioner was asked to pay Rs. 5.65<br />
Amount<br />
claimed<br />
(Rs. in<br />
Lacs)<br />
5.65<br />
170
Appellate<br />
Tribunal [now<br />
Customs,<br />
Excise, Service<br />
Tax Appellate<br />
Tribunal<br />
(CESTAT)] and<br />
the Collector of<br />
Central Excise<br />
(the<br />
“Respondent”)<br />
2. Indian Organic<br />
Chemicals<br />
Limited (the<br />
“Appellant”) v/s<br />
Commissioner<br />
of Central<br />
Excise (the<br />
“Respondent”)<br />
3. Indian Organic<br />
Chemicals<br />
Limited (the<br />
“Appellant”) v/s<br />
Commissioner<br />
of Central<br />
Excise<br />
(Appeals) (the<br />
“Respondent”)<br />
4. Futura Polymers<br />
Limited [a<br />
division of<br />
Futura<br />
Polyesters<br />
Limited] (the<br />
“Appellant”) v/s<br />
Commissioner<br />
of Central<br />
Excise, Chennai<br />
(the<br />
“Respondent”)<br />
5. Futura Polymers<br />
Limited (a<br />
division of<br />
Futura<br />
Polyesters<br />
Limited) (the<br />
“Appellant”) v/s<br />
Commissioner<br />
of Customs (the<br />
“Respondent”)<br />
6. Futura Polymers<br />
Limited (a<br />
division of<br />
Futura<br />
Polyesters<br />
Limited) (the<br />
“Applicant”) v/s<br />
Assistant<br />
Commissioner<br />
of Central<br />
Customs (the<br />
Customs,<br />
Excise and<br />
Gold Appellate<br />
Tribunal,<br />
Chennai [now<br />
Customs,<br />
Excise, Service<br />
Tax Appellate<br />
Tribunal<br />
(CESTAT)]<br />
Customs,<br />
Excise and<br />
Service Tax<br />
Appellate<br />
Tribunal,<br />
Chennai<br />
Customs,<br />
Excise and<br />
Service Tax<br />
Appellate<br />
Tribunal, New<br />
Delhi<br />
Customs,<br />
Excise<br />
Service<br />
Appellate<br />
Tribunal,<br />
Chennai<br />
and<br />
Tax<br />
Commissioner<br />
of Customs<br />
(Appeals),<br />
Chennai<br />
Appeal<br />
number<br />
35/02 of<br />
2002<br />
Appeal<br />
number<br />
E/37/2003<br />
Appeal<br />
number<br />
E/5179/2004<br />
The Appeal<br />
number has<br />
not been<br />
provided<br />
The Appeal<br />
number has<br />
not been<br />
provided<br />
lacs as duty. The Petitioner had appealed<br />
before the before the Collector (Appeal)<br />
which upheld the order of the Assistant<br />
Collector. The Appellant further<br />
appealed along with the application for<br />
condonation of delay before the<br />
Respondent Tribunal. The same was<br />
rejected by the Tribunal. This petition<br />
has thus, been filed against the order<br />
dated March 6, 1991 passed by the<br />
Tribunal refusing to condone the delay.<br />
This appeal has been filed against the<br />
order-in-appeal number 35 of 2002 dated<br />
June 3, 2002 passed by the<br />
Commissioner of Central Excise<br />
(Appeals) rejecting the refund claim<br />
made by the Appellant for credit of Rs.<br />
1,00,471.<br />
This appeal is filed against the order-inappeal<br />
number 84 of 2002 dated October<br />
29, 2002 passed by the Commissioner of<br />
Central Excise (Appeals) disallowing the<br />
credit of Rs. 9,45,067 availed on capital<br />
goods. The Customs, Excise and Service<br />
Tax Appellate Tribunal has passed an<br />
order dated April 11, 2005 for stay of the<br />
recovery till the final disposal of the<br />
case.<br />
This application has been filed for setting<br />
aside the order-in-original number 109 of<br />
2004 dated July 26, 2004 passed by the<br />
Commissioner of Central Excise<br />
(Appeals) demanding duty of Rs.<br />
49,21,772 under Section 11A of the<br />
Central Excise Act, 1944 and imposing a<br />
penalty of Rs. 50,000 under Rule 25 of<br />
the Central Excise No. (2) Rules, 2001.<br />
This appeal has been filed by the<br />
Appellant against the order-in-appeal<br />
number C3/225,311 and 346/ D/06/SEA;<br />
C. Cus. Number 696/2006 dated<br />
September 14, 2006 passed by the<br />
Commissioner of Customs (Appeals)<br />
demanding a duty amounting to Rs.<br />
314,250<br />
This appeal has been filed for setting<br />
aside the order-in-original number 6109<br />
of 2007 dated March 28, 2007 passed by<br />
the Respondent imposing a duty<br />
amounting to Rs. 136,904 and a penalty<br />
of Rs. 14,000.<br />
1.00<br />
9.45<br />
49.71<br />
3.14<br />
1.50<br />
171
“Respondent”)<br />
7. M/s Futura<br />
Fibres (a<br />
division of<br />
Futura<br />
Polyesters<br />
Limited) (the<br />
“Appellant”) v/s<br />
Assistant<br />
Commissioner<br />
of Central<br />
Excise (the<br />
“Respondent”)<br />
8. M/s Futura<br />
Fibres [a<br />
division<br />
Futura<br />
Polyesters<br />
Limited]<br />
of<br />
(the<br />
“Appellant”) v/s<br />
Commissioner<br />
of Central<br />
Excise, Chennai<br />
(the<br />
“Respondent”)<br />
9. M/s Futura<br />
Fibres [a<br />
division of<br />
Futura<br />
Polyesters<br />
Limited] (the<br />
“Appellant”) v/s<br />
Commissioner<br />
of Central<br />
Excise, Chennai<br />
(the<br />
“Respondent”)<br />
10. M/s Futura<br />
Fibres [a<br />
division of<br />
Futura<br />
Polyesters<br />
Limited] (the<br />
“Appellant”) v/s<br />
Commissioner<br />
of Central<br />
Excise, Chennai<br />
(the<br />
“Respondent”)<br />
Commissioner<br />
of Central<br />
Excise<br />
(Appeals),<br />
Chennai<br />
Customs,<br />
Excise<br />
Service<br />
Appellate<br />
Tribunal,<br />
Chennai<br />
Customs,<br />
Excise<br />
Service<br />
Appellate<br />
Tribunal,<br />
Chennai<br />
and<br />
Tax<br />
and<br />
Tax<br />
Commissioner<br />
of Central<br />
Excise<br />
(Appeals),<br />
Chennai<br />
Appeal<br />
number 11<br />
of 2008<br />
Appeal<br />
number<br />
E/87/06<br />
2006<br />
Appeal<br />
number<br />
E/302/06<br />
of<br />
Appeal<br />
number 146<br />
of 2005<br />
This appeal has been filed against the<br />
order-in-original number RF-2 of 2008<br />
dated February 4, 2008 wherein the<br />
Respondent credited the refund amount<br />
allegedly due to our company of Rs.<br />
1,539,603 to the Consumer Welfare<br />
Fund.<br />
This appeal has been filed against the<br />
order-in-appeal numbers 101 and 102<br />
dated October 24, 2005 passed by the<br />
Commissioner of Central Excise<br />
(Appeals) wherein the matter was<br />
remanded to the lower authority to<br />
rework the liability of interest at<br />
appropriate rate. The amount involved in<br />
this case is Rs. 10,46,525.<br />
This appeal has been filed against the<br />
order-in-appeals dated January 16, 2006<br />
passed by Commissioner of Central<br />
Excise (Appeals) for adjustment of the<br />
refund of Rs. 2,27,616 against arrears of<br />
Rs. 3,10,318 and rejection of the refund<br />
claim of Rs. 77,010<br />
This appeal has been filed against the<br />
order-in-original number RF 38 of 2005<br />
dated October 18, 2005 wherein the<br />
Respondent ordered the adjustment of<br />
pre-deposit of Rs. 80,000 against the<br />
arrears of Rs. 82,902.<br />
15.40<br />
10.47<br />
3.04<br />
0.80<br />
Cases filed against our Company<br />
Sr.<br />
No.<br />
Parties<br />
1. Show Cause<br />
Notice issued<br />
by Assistant<br />
Commissioner<br />
Authority<br />
before which<br />
pending<br />
Assistant<br />
Commissioner<br />
of Central<br />
Excise,<br />
Chennai<br />
Case Number Brief Particulars of<br />
Suit/Appeal/Case/Notice/Proceeding<br />
Show Cause<br />
Notice number<br />
365 of 1997<br />
Our Company through this show<br />
cause notice dated March 26, 1997<br />
has been asked to justify why a sum<br />
Rs. 13,33,828.91 which is alleged to<br />
have been utilised in contravention of<br />
Rule 57C of Central Excise Rules,<br />
1944 should not be demanded.<br />
Amount<br />
claimed<br />
(Rs. in<br />
Lacs)<br />
13.33<br />
2. Show Cause Superintendent Show Cause Our Company through this show 7.99<br />
172
Notice issued<br />
by<br />
Supreintendent<br />
of Central<br />
Excise<br />
3. Show Cause<br />
Notice issued<br />
by<br />
Superintendent<br />
of Central<br />
Excise<br />
4. Show Cause<br />
Notice issued<br />
by Additional<br />
Director of<br />
Anti -Evasion<br />
5. Show Cause<br />
Notice issued<br />
by the<br />
Superintendent<br />
of Central<br />
Excise<br />
6. Show Cause<br />
Notice issued<br />
by the<br />
Superintendent<br />
of Central<br />
Excise<br />
7. Show Cause<br />
Notice issued<br />
by the<br />
Assistant<br />
Commissioner<br />
of Central<br />
Excise<br />
8. Show Cause<br />
Notice issued<br />
by the<br />
Superintendent<br />
of Central<br />
Excise<br />
9. Show Cause<br />
Notice issued<br />
by the<br />
Superintendent<br />
of Central<br />
Excise<br />
of Central<br />
Excise<br />
Chennai<br />
Superintendent<br />
of Central<br />
Excise,<br />
Chennai<br />
Directorate<br />
General of<br />
Anti-Evasion<br />
(Central<br />
Excise),<br />
Chennai<br />
Superintendent<br />
of Central<br />
Excise<br />
Superintendent<br />
of Central<br />
Excise,<br />
Chennai<br />
Assistant<br />
Commissioner<br />
of Central<br />
Excise,<br />
Chennai.<br />
Superintendent<br />
of Central<br />
Excise,<br />
Chennai<br />
Superintendent<br />
of Central<br />
Excise,<br />
Chennai<br />
Notice number<br />
412 of 1999<br />
Show Cause<br />
Notice number<br />
365 of 2000<br />
Show Cause<br />
Notice number<br />
39 of 2000<br />
Show Cause<br />
Notice number 6<br />
of 2000<br />
Show Cause<br />
Notice number<br />
469 of 2001<br />
Show Cause<br />
Notice number<br />
IV/16/41/2001 –<br />
Adj<br />
Show Notice<br />
number 413 of<br />
2002<br />
Show Cause<br />
Notice number<br />
106 of 2002<br />
cause notice dated June 4, 1999 has<br />
been asked to justify why a sum Rs.<br />
7,99,418.64 which is alleged to have<br />
been utilised in contravention of Rule<br />
57C of Central Excise Rules, 1944<br />
should not be demanded.<br />
Our Company through this show<br />
cause notice dated July 4, 2000 has<br />
been asked to justify why a sum Rs.<br />
1,94,498 which is alleged to have<br />
been utilised in contravention of Rule<br />
57C of Central Excise Rules, 1944<br />
should not be demanded.<br />
Our Company through this show<br />
cause notice dated September 2, 2000<br />
has been asked to justify why a sum<br />
of Rs. 19,50,46,129 being duty<br />
concession which is alleged to have<br />
been wrongly availed should not be<br />
demanded under Section 11A Central<br />
Excise Act, 1944 .<br />
Our Company through this show<br />
cause notice dated January 4, 2000<br />
has been asked to justify why a sum<br />
Rs. 2,37,904.16 which is alleged to<br />
have been utilised in contravention of<br />
Rule 57C of Central Excise Rules,<br />
1944 should not be demanded.<br />
Our Company through this show<br />
cause notice dated September 7, 2001<br />
has been asked to justify why a sum<br />
Rs. 4,33,753 which is alleged to have<br />
been availed in contravention of Rule<br />
57AD of Central Excise Rules, 1944<br />
should not be recovered.<br />
Our Company through this show<br />
cause notice dated May 7, 2000 has<br />
been asked to justify why the benefit<br />
of concessional rates of duty should<br />
not be denied for non-fulfillment of<br />
the net foreign exchange earning as a<br />
percentage of exports and a<br />
consequential differential duty of a<br />
sum of Rs. 7,70,87,818 should not be<br />
demanded under Section 11A Central<br />
Excise Act, 1944.<br />
Our Company through this show<br />
cause notice dated July 11, 2002 has<br />
been asked to justify why the<br />
disallowance of Rs. 1,71,89,579<br />
should be permitted under Rule 12 of<br />
the Cenvat Credit Rules, 2001<br />
Our Company through this show<br />
cause notice dated February 20, 2002<br />
has been asked to justify why Rs.<br />
2,78,28,745.50 should not be<br />
disallowed out of the credit of Rs.<br />
5,56,57,491 under Rule 12 of the<br />
Cenvat Credit Rules 2001. Further,<br />
our Company has been asked to<br />
justify why the penalty which the<br />
show cause notice proposes to impose<br />
should not be levied on it.<br />
10. Show Cause Assistant Show Cause Our Company through this show 3.90<br />
1.94<br />
1950.46<br />
2.37<br />
4.33<br />
770.88<br />
171.90<br />
278.29<br />
173
Notice issued<br />
by the<br />
Superintendent<br />
of Central<br />
Excise<br />
11. Commissioner<br />
of Central<br />
Excise<br />
(Appeals) (the<br />
“Appellant”)<br />
v/s Indian<br />
Organic<br />
Chemicals<br />
Limited (the<br />
“Respondent”)<br />
12. Commissioner<br />
of Central<br />
Excise<br />
Chennai (the<br />
“Appellant”)<br />
v/s Indian<br />
Organic<br />
Chemicals<br />
Limited and<br />
Customs,<br />
Excise and<br />
Service tax<br />
Appellant<br />
Tribunal,<br />
Chennai (the<br />
“Respondent”)<br />
13. Commissioner<br />
of Central<br />
Excise,<br />
Chennai (the<br />
“Appellant”)<br />
v/s M/s Futura<br />
Fibres, Futura<br />
Polymers (the<br />
“Respondent”)<br />
14. Show Cause<br />
Notice issued<br />
by the<br />
Additional<br />
Commissioner<br />
of Central<br />
Excise<br />
Commissioner<br />
of Central<br />
Excise,<br />
Chennai<br />
Customs,<br />
Excise<br />
Service<br />
Appellate<br />
Tribunal,<br />
Chennai<br />
and<br />
Tax<br />
High Court of<br />
Judicature at<br />
Madras<br />
Supreme<br />
Court of India<br />
Office of the<br />
Commissioner<br />
of Central<br />
Excise,<br />
Chennai<br />
Notice number<br />
30 of 2002<br />
Appeal number<br />
E/305/2006<br />
CM appeal<br />
number 1641 of<br />
2005<br />
Civil appeal<br />
number 427-428<br />
of 2006<br />
Show Cause<br />
Notice Number<br />
V/15/55/45/2007-<br />
Adj<br />
cause notice dated January 21, 2002<br />
has been asked to justify why a sum<br />
Rs. 3,89,686 which is alleged to have<br />
been availed in contravention of Rule<br />
57AD of Central Excise Rules, 1944<br />
should not be demanded.<br />
This appeal has been filed against the<br />
order-in-appeal number 02 of 2006<br />
dated January 16, 2006 passed by the<br />
Commissioner of Central Excise<br />
(Appeals) wherein payment of Rs.<br />
43,74,354 has been imposed as<br />
Cenvat credit on furnace oil is not<br />
eligible to be availed and a penalty of<br />
Rs. 10,00,000 has been imposed for<br />
credit availed under Rule 13 of the<br />
Central Excise Rules, 1944.<br />
This appeal is filed against the final<br />
order number 1018 of 2003 dated<br />
November 28, 2003 passed by the<br />
Customs, Excise and Service Tax<br />
Appellate Tribunal, Chennai. The<br />
Appellant has alleged that the first<br />
respondent has suppressed the fact of<br />
supplying steam to Futura Industries<br />
Limited Further the Appellant has<br />
alleged that the first respondent has<br />
fraudulently evaded the excise duty by<br />
concealing the supply of steam to<br />
Futura Industries Limited.<br />
These civil appeals are filed against<br />
the impugned final orders 1000 and<br />
1001 of 2004 dated November 18,<br />
2004 passed by the Customs, Excise<br />
and Service Tax Appellate Tribunal<br />
(“CESTAT”) holding that the demand<br />
of Rs. 470,178 is not affected by the<br />
amendments made to Section 65 by<br />
Parliament under Section 116 of the<br />
Finance Act, 2000. The appeal is filed<br />
on the grounds that the CESTAT<br />
failed to consider that a combined<br />
reading of Section 116 and 117 of the<br />
Finance Act, 2000 makes the<br />
respondent to pay service tax as per<br />
Section 66 of Finance Act, 1994. The<br />
Appellant has therefore prayed for the<br />
admission and allowance of the appeal<br />
against the final order number 1000<br />
and 1001 of 2004 dated November 18,<br />
2004.<br />
Our Company through this show<br />
cause dated August 23, 2007 has been<br />
asked to justify why a sum of Rs.<br />
36,14,972 alleged to have been<br />
availed as service tax credit on<br />
outward transport of finished goods<br />
for the period from May 2005 to 2007<br />
under Rule 14 of the Cenvat Credit<br />
Rules read with proviso to Section<br />
11A of the Central Excise Act, 1944<br />
53.74<br />
1.81<br />
4.7<br />
36.14<br />
174
15. Show Cause<br />
Notice issued<br />
by the<br />
Assistant<br />
Commissioner<br />
of Central<br />
Excise<br />
16. Show Cause<br />
Notice issued<br />
by the<br />
Additional<br />
Commissioner<br />
of Central<br />
Excise<br />
17. Show Cause<br />
Notice issued<br />
by the<br />
Assistant<br />
Commissioner<br />
of Central<br />
Excise<br />
18. Show Cause<br />
Notice issued<br />
by the<br />
Assistant<br />
Commissioner<br />
of Central<br />
Excise<br />
19. Commissioner<br />
of Central<br />
Excise v/s.<br />
Futura<br />
Polyesters<br />
Limited<br />
Office of the<br />
Assistant<br />
Commissioner<br />
of Central<br />
Excise,<br />
Chennai<br />
Office of the<br />
Commissioner<br />
of Central<br />
Excise,<br />
Chennai<br />
Office of the<br />
Commissioner<br />
of Central<br />
Excise,<br />
Chennai<br />
Office of<br />
Commissioner<br />
of Customs,<br />
Chennai<br />
Supreme<br />
Court of India<br />
Show Cause<br />
Notice Number<br />
IV/16/60/2007-<br />
Adj.<br />
Show Cause<br />
Notice number<br />
V/15/55/3/08 Adj<br />
Show Cause<br />
Notice number<br />
V/16/16/2008-<br />
Adj<br />
Show Cause<br />
Notice number<br />
S4/47/2005-<br />
Bonds<br />
C.A.No.<br />
4522/2003<br />
should not be levied<br />
Our Company through this show<br />
cause notice dated December 27, 2007<br />
has been asked to justify why a sum<br />
Rs. 2,49,407 which is alleged to have<br />
been availed as service tax credit on<br />
outdoor catering service for the period<br />
from December 2006 to February<br />
2007 under Section 65 (76 a) of the<br />
Finance Act, 1994 should not be<br />
demanded under Rule 14 of the<br />
Cenvat Credit Rules, 2004 read with<br />
the extended proviso to Section 11A<br />
of the Central Excise Act, 1944.<br />
Our Company through this show<br />
cause notice dated February 26, 2008<br />
has been asked to justify why a sum<br />
of Rs. 8,44,718 which is alleged to<br />
have been availed as service tax credit<br />
on outdoor catering service for the<br />
period from March 2007 to December<br />
2007 under Section 65 (76 a) of the<br />
Finance Act, 1994 should not be<br />
demanded under Rule 14 of the<br />
Cenvat Credit Rules, 2004 read with<br />
the extended proviso to Section 11A<br />
of the Central Excise Act, 1944.<br />
Our Company through this show<br />
cause notice dated March 19, 2008<br />
has been asked to justify why a sum<br />
of Rs. 53,214 availed as service tax<br />
credit on outdoor catering service<br />
under Section 65 (76 a) of the Finance<br />
Act, 1994 should not be demanded<br />
under Rule 14 of the Cenvat Credit<br />
Rules, 2004 read with the extended<br />
proviso to Section 11A of the Central<br />
Excise Act, 1944<br />
Our Company through this show<br />
cause notice dated February 8, 2005<br />
was asked to justify the following<br />
(a) The grounds for not treating M/s<br />
Futura Polymers and M/s Futura<br />
Preforms as related persons in terms<br />
of Rule 2(2) of the Customs Valuation<br />
Rules;<br />
(b) The grounds for not levying Rs.<br />
30, 48, 175 as differential duty<br />
(C) The grounds for not the levying<br />
penalty under the Central Excise<br />
Rules<br />
The department of Central Excise has<br />
filed an appeal before the Supreme<br />
Court of India against the order<br />
passed by CEGAT. The<br />
Commissioner of Central Excise<br />
claimed 50% concessional duty on<br />
goods transferred from EOU to DTA<br />
on the aggregate of all duties payable<br />
by EOU, Our Company has paid the<br />
duty on 50% on each of such duties<br />
payable by EOU.<br />
2.49<br />
8.44<br />
0.53<br />
30.48<br />
20. Superintendent Additional NA Superintendent of Central Excise 17.83<br />
121<br />
175
of Central<br />
Excise v/s.<br />
Futura<br />
Polyesters<br />
Limited<br />
21. Superintendent<br />
of Central<br />
Excise v/s.<br />
Futura<br />
Polyesters<br />
Limited<br />
22. Superintendent<br />
of Central<br />
Excise v/s<br />
Futura<br />
Polyesters<br />
Limited<br />
23. Superintendent<br />
of Central<br />
Excise v/s<br />
Futura<br />
Polyesters<br />
Limited<br />
Commissioner<br />
of Central<br />
Excise,<br />
Central Excise<br />
Service Tax<br />
Appellate<br />
Tribunal<br />
High Court of<br />
Judicature at<br />
Madras<br />
High Court of<br />
Judicature at<br />
Madras<br />
NA<br />
RCP number 32<br />
of 2000<br />
RCP number 37<br />
of 2001<br />
claims that the preforms divisions can<br />
claim only 50% of Central Value<br />
added Tax (CENVAT) in respect of<br />
goods supplied to preforms division<br />
from EOU.<br />
The Superintendent of Central Excise<br />
has appealed against the order of the<br />
Commissioner of Central Excise,<br />
which allowed our Company to be<br />
entitled to CENVAT credit on<br />
purchase of furnace oil used for<br />
generation of steam diverted to EOU.<br />
The Superintendent of Central Excise<br />
has appealed against order of<br />
Commissioner of Central Excise,<br />
which allowed our Company to be<br />
entitled to input credit in respect of<br />
polyester staple fibre supplied to<br />
ultimate exporter.<br />
The Superintendent of Central Excise<br />
has appealed against order of<br />
Commissioner of Central Excise,<br />
which allowed our Company to be<br />
entitled to input credit in respect of<br />
polyester staple fibre supplied to<br />
ultimate exporter.<br />
8.00<br />
3.68<br />
2.15<br />
176
PART II – OUTSTANDING LITIGATIONS IN RELATION TO OUR DIRECTORS/PROMOTERS<br />
In addition to suit number 266 of 2007 and show cause notice number 030100200093AM09/20as referred to in<br />
the tables above in this section, following are the litigations in relation to our Directors/Promoters<br />
Civil Case file against Mr. M. D. Dalal in his capacity as a director of Sitladas Estate Private Limited<br />
Parties<br />
Bharat R.<br />
Javeri,<br />
Deviben S.<br />
Dalal v/s.<br />
Sitaldas<br />
Estate<br />
Private<br />
Limited<br />
Authority<br />
before which<br />
pending<br />
Small Causes<br />
Court,<br />
Maharashtra<br />
Brief Particulars of<br />
Suit/Appeal/Case/Notice/Proceeding<br />
The Plaintiff have filed this case for possession of<br />
an open space (garage) used for parking by the<br />
defendant. The plaintiffs pray for ad-interim<br />
injunction to be passed restraining the defendant<br />
from using space for parking its cars.<br />
Status<br />
Pending<br />
Amount of<br />
Liability<br />
involved<br />
(Rs. In lacs)<br />
Not<br />
quantifiable as<br />
there is no<br />
direct<br />
monetary<br />
claim<br />
involved.<br />
177
PART III– OUTSTANDING LITIGATIONS IN RELATION TO OUR PROMOTER GROUP<br />
ENTITIES<br />
1. Sonata Software Limited<br />
Cases filed against Sonata Software Limited<br />
Sr.<br />
No.<br />
Parties<br />
1. Mrs. Uma Jain<br />
(the<br />
“Complainant”)<br />
v/s Sonata<br />
Software<br />
Limited, New<br />
Delhi, Hewlett<br />
Packard India<br />
Limited,<br />
Rajendra<br />
Palace, New<br />
Delhi, Sonata<br />
Software<br />
Limited,<br />
Bangalore,<br />
Hewlett<br />
Packard<br />
Limited,<br />
Kasturba<br />
Gandhi<br />
India<br />
Marg,<br />
New Delhi and<br />
Sonata<br />
Software<br />
Limited,<br />
Mumbai<br />
“Opposite<br />
Parties”)<br />
2. Calcutta<br />
Creative<br />
(the<br />
Printers Private<br />
Limited (the<br />
“Plaintiff”) v/s.<br />
Sonata<br />
Software<br />
Limited (the<br />
“Defendant No.<br />
1”) and NICCO<br />
UCO Financial<br />
Service<br />
Limited (the<br />
“Defendant No.<br />
2”)<br />
Authority before<br />
which pending<br />
District Consumer<br />
DisputesRedressal<br />
Forum, Jagdalpur<br />
High Court of<br />
Judicature at<br />
Calcutta<br />
Case<br />
Number<br />
Consumer<br />
Complaint<br />
number<br />
68/95<br />
Suit No.<br />
227 of<br />
1997<br />
Brief Particulars of<br />
Suit/Appeal/Case/Notice/Proceeding<br />
This complaint has been filed by the<br />
Complainant alleging a deficiency in<br />
service on the part of the Opposite<br />
Parties. Vide order dated December<br />
21, 2000 the District Forum directed<br />
the Opposite Parties to replace the<br />
product purchased by the<br />
Complainant for deficiency in<br />
service. An order has been passed by<br />
the State Consumer Disputes<br />
Redressal Commission dated<br />
September 27, 2002 directing the<br />
District Forum to decide the case<br />
afresh.<br />
This suit has been filed by the<br />
Plaintiff for the alleged damages<br />
sustained due to non-performance of<br />
the Pressmate. Further, the Plaintiff<br />
has alleged that the Defendant No. 1<br />
has failed to supply the equipment and<br />
subsequently did not integrate the<br />
system. Consequently, the Plaintiff<br />
could not carry on the business and<br />
sustained losses.<br />
Amount<br />
claimed<br />
(Rs. in<br />
Lacs)<br />
Not<br />
quantifiable<br />
68.86<br />
178
2. Hathway Investment Private Limited<br />
Income tax cases filed against Hathway Investment Private Limited<br />
Sr.<br />
No.<br />
Parties<br />
1. Additional<br />
Commissioner<br />
of Income Tax<br />
(the<br />
“Appellant”) v/s<br />
Hathway<br />
Investments<br />
Private Limited<br />
(the<br />
“Respondent”)<br />
2. Deputy<br />
Commissioner<br />
of Income Tax<br />
(the<br />
“Appellant”) v/s<br />
Hathway<br />
Investments<br />
Private Limited<br />
(the<br />
“Respondent”)<br />
3. Deputy<br />
Commissioner<br />
of Income Tax<br />
(the<br />
“Appellant”) v/s<br />
Hathway<br />
Investments<br />
Private Limited<br />
(the<br />
“Respondent”)<br />
4. Deputy<br />
Commissioner<br />
of Income Tax<br />
(the<br />
“Appellant”) v/s<br />
Hathway<br />
Investments<br />
Private Limited<br />
(the<br />
“Respondent”)<br />
5. Assistant<br />
Deputy<br />
Commissioner<br />
of Income Tax<br />
(the<br />
“Appellant”) v/s<br />
Authority<br />
before<br />
which<br />
pending<br />
Income<br />
Tax<br />
Appellate<br />
Tribunal,<br />
Mumbai<br />
Income<br />
Tax<br />
Appellate<br />
Tribunal,<br />
Mumbai<br />
Income<br />
Tax<br />
Appellate<br />
Tribunal,<br />
Mumbai<br />
Income<br />
Tax<br />
Appellate<br />
Tribunal,<br />
Mumbai<br />
Income<br />
Tax<br />
Appellate<br />
Tribunal,<br />
Mumbai<br />
Case number Brief Particulars of<br />
Suit/Appeal/Case/Notice/Proceeding<br />
Appeal number<br />
2406/Mum/2001 for the<br />
Assessment Year 1994-<br />
1995<br />
Appeal number<br />
7317/Mum/2002 for the<br />
Assessment Year 1995-<br />
1996<br />
Appeal<br />
number7318/Mum/2002<br />
for the Assessment Year<br />
1996-1997<br />
Appeal number<br />
1237/Mum/2003 for the<br />
Assessment Year 1997-<br />
1998<br />
Appeal numbers<br />
6531/Mum/2003 and<br />
7026/Mum/2004 for the<br />
Assessment Year 1998-<br />
1999<br />
This appeal has been filed against the order<br />
dated February 14, 2001 passed by the<br />
Commissioner of Income Tax (Appeals)<br />
praying for restoration of the assessment<br />
order passed by the Appellant for the<br />
Assessment Year 1994-1995 and for<br />
allowing the disallowance of depreciation<br />
on office and residential premises<br />
amounting to Rs. 18,74,110<br />
This appeal has been filed against the order<br />
dated October 07, 2002 passed by the<br />
Commissioner of Income Tax (Appeals)<br />
praying for restoration of the assessment<br />
order passed by the Appellant for the<br />
Assessment Year 1995-1996 and for<br />
allowing the disallowance of depreciation<br />
on office and residential premises<br />
amounting to Rs. 37,70,931<br />
This appeal has been filed against the order<br />
dated October 07, 2002 passed by the<br />
Commissioner of Income Tax (Appeals)<br />
praying for restoration of the assessment<br />
order passed by the Appellant for the<br />
Assessment Year 1996-1997 and for<br />
allowing the disallowance of depreciation<br />
on office and residential premises<br />
amounting to Rs. 38,27,688<br />
This appeal has been filed against the order<br />
dated December 10, 2002 passed by the<br />
Commissioner of Income Tax (Appeals)<br />
praying for restoration of the assessment<br />
order passed by the Appellant for the<br />
Assessment Year 1997-1998, and for<br />
allowing:<br />
1. The disallowance of Rs. 26,043 made<br />
under Rule 6B,<br />
2. The addition of Rs. 2,04,000 being<br />
expenditure on maintenance of the<br />
guest house,<br />
3. The addition on account of<br />
depreciation claimed on cost of land<br />
and FSI included in office and<br />
residential premises and<br />
4. The addition of Rs. 44,27,019 being<br />
the lease equalization amount<br />
This appeal has been filed against the order<br />
dated July 22, 2003 passed by the<br />
Commissioner of Income Tax (Appeals)<br />
praying for restoration of the assessment<br />
order passed by the Appellant for the<br />
Assessment Year 1998-1999, and for:<br />
179
Hathway<br />
Investments<br />
Private Limited<br />
(the<br />
“Respondent”)<br />
6. Assistant<br />
Deputy<br />
Commissioner<br />
of Income Tax<br />
(the<br />
“Appellant”) v/s<br />
Hathway<br />
Investments<br />
Private Limited<br />
(the<br />
“Respondent”)<br />
7. Assistant<br />
Commissioner<br />
of Income Tax<br />
Central Circle<br />
34, Mumbai (the<br />
“Appellant”) v/s<br />
Hathway<br />
Investments<br />
Private Limited<br />
(the<br />
“Respondent”)<br />
8. Assistant<br />
Commissioner<br />
of Income Tax<br />
(the<br />
“Appellant”) v/s<br />
Hathway<br />
Investments<br />
Private Limited<br />
(the<br />
“Respondent”)<br />
9. Assistant<br />
Deputy<br />
Commissioner<br />
of IncomeTax<br />
(the<br />
“Appellant”) v/s<br />
Hathway<br />
Investments<br />
Private Limited<br />
(the<br />
“Respondent”)<br />
Income<br />
Tax<br />
Appellate<br />
Tribunal,<br />
Mumbai<br />
Income<br />
Tax<br />
Appellate<br />
Tribunal,<br />
Mumbai<br />
Income<br />
Tax<br />
Appellate<br />
Tribunal,<br />
Mumbai<br />
Income<br />
Tax<br />
Appellate<br />
Tribunal,<br />
Mumbai<br />
Appeal number<br />
6532/Mum/2003 for the<br />
Assessment Year 1999-<br />
2000<br />
Appeal number<br />
734/Mum/2005 for the<br />
Assessment Year 2000-<br />
2001<br />
Appeal Number<br />
735/Mum/2005 for the<br />
Assessment Year 2001-<br />
2002<br />
Appeal Number,<br />
5085/Mum/2005<br />
1. Disallowing the depreciation of Rs.<br />
12,80,640 in respect of land of the<br />
office and residential premises,<br />
2. Disallowing the claim of deduction of<br />
the principal amount of Rs. 85,67,847<br />
and Rs. 1,10,54,201 received from<br />
Rajasthan State Electricity Board and<br />
Gujarat State Electricity Board and<br />
3. Disallowing the relief of Rs, 87,47,268<br />
on the ground that the credit to lease<br />
equalization reserve and consequent<br />
reduction from net profit is not<br />
permissible.<br />
This appeal has been filed against the order<br />
dated July 22, 2003 passed by the<br />
Commissioner of Income Tax (Appeals)<br />
praying for restoration of the assessment<br />
order passed by the Appellant for the<br />
Assessment Year 1999-2000,for:<br />
1. Disallowing the depreciation of Rs.<br />
11,65,696 in respect of land of the<br />
office and residential premises<br />
2. Disallowing the claim of deduction of<br />
the principal amount of Rs. 92,08,337<br />
and Rs. 4,99,68,076 received from<br />
Rajasthan State Electricity Board and<br />
Gujarat State Electricity Board<br />
respectively<br />
This appeal has been filed against the order<br />
dated November 22, 2004 passed by the<br />
Commissioner of Income Tax (Appeals)<br />
praying for restoration of the assessment<br />
order passed by the Appellant for the<br />
Assessment Year 2000-2001, and for<br />
allowing the disallowance of the<br />
depreciation of Rs. 10,61,592 in respect of<br />
land of office and residential premises<br />
which includes the cost of land/FSI.<br />
This appeal has been filed against the order<br />
dated November 22, 2004 passed by the<br />
Commissioner of Income Tax (Appeals)<br />
praying for restoration of the assessment<br />
order passed by the Appellant for the<br />
Assessment Year 2001-2002, and for<br />
allowing the disallowance of depreciation<br />
of Rs. 10,61,592 in respect of land of office<br />
and residential premises which includes the<br />
cost of land/FSI.<br />
This appeal has been filed against the order<br />
dated May 19, 2005 passed by the<br />
Commissioner of Income Tax (Appeals)<br />
praying for restoration of the assessment<br />
order passed by the Appellant for the<br />
Assessment Year 2002-2003, and for<br />
allowing the disallowance of depreciation<br />
of Rs. 10,61,592 in respect of land of office<br />
and residential premises which includes the<br />
cost of land/FSI.<br />
Commercial case against Hathway Investments Private Limited<br />
180
Sr.<br />
No.<br />
Parties<br />
1. Kapesh R.<br />
Shah<br />
(Plaintiff) v/s<br />
Larsen Toubro<br />
(the<br />
“Defendant<br />
No. 1”),<br />
Pravinsingh<br />
Chhanubha<br />
Jhala (the<br />
“Defendant<br />
No. 2”) and<br />
Hathway<br />
Investment<br />
Private<br />
Limited (the<br />
“Defendant<br />
No. 3”)<br />
Authority<br />
before<br />
which<br />
pending<br />
High<br />
Court of<br />
Judicature<br />
at Bombay<br />
Case<br />
Number<br />
Chamber<br />
Summons<br />
No. 1029<br />
of 1997 in<br />
suit<br />
number<br />
4992 of<br />
1994<br />
Brief Particulars of<br />
Suit/Appeal/Case/Notice/Proceeding<br />
This suit has been filed for the recovery 250<br />
equity shares arising on conversion 50,<br />
12.5% fully convertible secured debentures.<br />
The Plaintiff in this suit has alleged that he<br />
had purchased 50, 12.5% fully convertible<br />
secured debentures of Defendant No. 1 from<br />
Defendant No. 2 which at that time were<br />
partly paid up by Defendant No. 2.<br />
Defendant No. 1 issued a notice for the<br />
pending call money which was sent to<br />
Defendant No. 2, who in turn allegedly gave<br />
it to the Plaintiff, since the Defendant No. 2<br />
had sold the shares to the Plaintiff. The<br />
Plaintiff has alleged that he duly paid the<br />
entire pending call money on the said<br />
debentures, but did not send the said<br />
debentures, for transfer in his own name. At<br />
the time of conversion of the said<br />
debentures, into 250 equity shares, they were<br />
converted and equity shares were issued in<br />
the name of the Defendant No. 2 by<br />
Defendant No. 1 The Plaintiff has thus<br />
alleged that the Defendant No. 2 received<br />
250 equity shares; he in turn sold them in the<br />
open market out of which 200 shares were<br />
purchased by Defendant No. 3 and 50 shares<br />
by someone else.<br />
Amount of<br />
Claims<br />
Involved<br />
(Rs. in lacs)<br />
Not<br />
quantifiable<br />
Labour Case filed against Hathway Investments Private Limited<br />
Sr.<br />
No.<br />
Parties<br />
1. Mr. Ashok Yadav<br />
(the<br />
“Complainant”)<br />
v/s. Hathway<br />
Investments<br />
Private Limited<br />
(the “Respondent<br />
No. 1”) and Mr.<br />
Rajan Raheja (the<br />
“Respondent No.<br />
2”)<br />
Authority<br />
before<br />
which<br />
pending<br />
Labour<br />
Court,<br />
Mumbai<br />
Case<br />
Number<br />
Complaint<br />
(ULP) No.<br />
539 of<br />
2003<br />
Brief Particulars of<br />
Suit/Appeal/Case/Notice/Proceeding<br />
This suit has been filed against the<br />
alleged illegal termination of the<br />
Complainant. The Complainant has<br />
alleged that bonus and other statutory<br />
emoluments have not been paid to him.<br />
The Complainant has thus prayed for<br />
reinstatement with the payment of entire<br />
back wages.<br />
Amount of<br />
Claims<br />
Involved<br />
(Rs. in lacs)<br />
Entire back<br />
wages from<br />
the date of<br />
Termination<br />
till the<br />
resumption<br />
of Services.<br />
3. Outlook Publishing (India) Private Limited<br />
Income tax cases filed against Outlook Publishing (India) Private Limited<br />
Sr.<br />
No<br />
Parties<br />
1. Deputy<br />
Commissioner of<br />
Income tax<br />
(the “Appellant”)<br />
Authority<br />
before<br />
which<br />
pending<br />
Income<br />
Tax<br />
Appellate<br />
Tribunal,<br />
Case Number Brief Particulars of<br />
Suit/Appeal/Case/Notice/Proceeding<br />
Appeal Number.<br />
6862/Mum/2006<br />
for<br />
the<br />
Assessment Year<br />
This appeal has been filed against the order<br />
dated September 18, 2006 passed by the<br />
Commissioner of Income Tax (Appeals)<br />
praying for restoration of the assessment order<br />
181
v/s. Outlook<br />
Publishing (India)<br />
Private Limited<br />
(the<br />
“Respondent”)<br />
Mumbai 2003-2004 passed by the appellant for the Assessment Year<br />
2003-2004 and for allowing the disallowance of<br />
Rs. 16,59,835 which were classified as personal<br />
expenses.<br />
Civil cases filed against Outlook Publishing (India) Private Limited<br />
Sr.<br />
No<br />
Parties<br />
1. Indira Ray (the<br />
“Plaintiff”) v/s<br />
Vinod Mehta (the<br />
“Defendant<br />
No.1”),<br />
Maheshwari Puri<br />
(the “Defendant<br />
No.2”) and<br />
Jaideep<br />
Mazumdar (the<br />
“Defendant<br />
No.3”)<br />
2. Abhishek Verma<br />
(the “Plaintiff”)<br />
v/s. Saikat Datta<br />
(the “Defendant<br />
No. 1”), Outlook<br />
Publishing (India)<br />
Private Limited<br />
(the “Defendant<br />
No. 2”), Vinod<br />
Mehta (the<br />
“Defendant No.<br />
3”) and<br />
Maheshwar Peri<br />
(the “Defendant<br />
No. 4”)<br />
3. Thales S.A. (the<br />
“Plaintiff”) v/s.<br />
Outlook<br />
Publishing (India)<br />
Private Limited &<br />
Others (the<br />
“Defendants”)<br />
4. Jean Paul Perrier<br />
(the “Plaintiff”)<br />
v/s. Outlook<br />
Publishing (India)<br />
Private Limited &<br />
Others (the<br />
“Defendants”)<br />
5. Gwendolyn<br />
Berger<br />
“Plaintiff”)<br />
(the<br />
v/s.<br />
Outlook<br />
Publishing (India)<br />
Private Limited &<br />
Others (the<br />
Authority<br />
before<br />
which<br />
pending.<br />
Court of<br />
Civil<br />
Judge,<br />
Senior<br />
Division,<br />
Puri<br />
High<br />
Court of<br />
Judicature<br />
at New<br />
Delhi<br />
High<br />
Court of<br />
Judicature<br />
at New<br />
Delhi<br />
High<br />
Court of<br />
Judicature<br />
at New<br />
Delhi<br />
High<br />
Court of<br />
Judicature<br />
at New<br />
Delhi.<br />
Case<br />
Number<br />
Civil suit<br />
no.<br />
330/2007<br />
CS (OS)<br />
No.<br />
290/2006<br />
and<br />
461/2006<br />
CS (OS)<br />
No.<br />
350/2006<br />
CS (OS)<br />
No.<br />
388/2006.<br />
CS (OS)<br />
No. 1185<br />
/2007<br />
Brief Particulars of<br />
Suit/Appeal/Case/Notice/Proceeding<br />
This suit has been filed for damages and<br />
compensation for the alleged defamation<br />
of the Plaintiff caused by the Defendants.<br />
The cause of action as alleged by the<br />
Plaintiff arose on the publication of an<br />
article in the weekly magazine,<br />
“Outlook”, which is edited, published and<br />
authored by the Defendants.<br />
This suit has been filed for damages and<br />
compensation for the alleged defamation<br />
of the Plaintiff caused by the Defendants.<br />
The cause of action as alleged by the<br />
Plaintiff arose on the publication of an<br />
article in the weekly magazine,<br />
“Outlook”, which is edited, published and<br />
authored by the Defendants.<br />
This suit has been filed for damages and<br />
compensation for the alleged defamation<br />
of the Plaintiff caused by the Defendants.<br />
The cause of action as alleged by the<br />
Plaintiff arose on the publication of an<br />
article in the weekly magazine,<br />
“Outlook”, which is edited, published and<br />
authored by the Defendants.<br />
This suit has been filed for damages and<br />
compensation for the alleged defamation<br />
of the Plaintiff caused by the Defendants.<br />
The cause of action as alleged by the<br />
Plaintiff arose on the publication of an<br />
article in the weekly magazine,<br />
“Outlook”, which is edited, published and<br />
authored by the Defendants.<br />
This suit has been filed for damages and<br />
compensation for the alleged defamation<br />
of the Plaintiff caused by the Defendants.<br />
The cause of action as alleged by the<br />
Plaintiff arose on the publication of an<br />
article in the weekly magazine,<br />
“Outlook”, which is edited, published and<br />
Amount of<br />
Claim<br />
Involved<br />
(Rs. in<br />
lacs).<br />
1005.00<br />
25.00<br />
100.00<br />
100.00<br />
50.00<br />
182
“Defendants”)<br />
6. T.V. Today<br />
Network Limited<br />
(the “Plaintiff”)<br />
v/s. Hathway<br />
Investments<br />
Private Limited &<br />
Others (the<br />
“Defendants”)<br />
7. Mrs. Supriya<br />
Aggarwal (the<br />
“Petitioner” v/s.<br />
India Today &<br />
Others (the<br />
“Respondents”)<br />
8. M/s. Tosiba<br />
Appliances (the<br />
“Plaintiff”) v/s<br />
M/s. Kabushiki<br />
Kaisha Toshiba &<br />
Others (the<br />
“Defendants”)<br />
9. Ms. Nisha<br />
Somaiya (the<br />
“Plaintiff”) v/s.<br />
Outlook<br />
Publishing (India)<br />
Private Limited &<br />
Others (the<br />
“Defendants”)<br />
10. Mr. Rajinder<br />
Kumar Gupta (the<br />
“Plaintiff”) v/s<br />
Shri Kalathil<br />
Palankandi Shiv<br />
Keshvan &<br />
Others (the<br />
“Defendants”)<br />
11. Mr. Balasaheb<br />
Keshav<br />
Thackeray (the<br />
“Plaintiff”) v/s<br />
Hathway<br />
Investments<br />
Limited & Others<br />
(the<br />
“Defendants”)<br />
High<br />
Court of<br />
Judicature,<br />
at New<br />
Delhi<br />
High<br />
Court of<br />
Judicature<br />
at New<br />
Delhi.<br />
High<br />
Court of<br />
Judicature<br />
at New<br />
Delhi<br />
High<br />
Court of<br />
Judicature<br />
at New<br />
Delhi<br />
Court of<br />
District<br />
Judge,<br />
Delhi<br />
High<br />
Court of<br />
Judicature<br />
atBombay<br />
Suit No.<br />
1753/2002<br />
Civil Writ<br />
Petition<br />
No.<br />
19085/2005.<br />
Suit No.<br />
2356<br />
of 1998<br />
CS (OS)<br />
No. 2132<br />
of 2006.<br />
Civil Suit<br />
No. 125 of<br />
2006.<br />
Suit No. 246<br />
of 2001<br />
authored by the Defendants.<br />
This suit has been filed for damages and<br />
compensation for the alleged defamation<br />
and libel of the Plaintiff caused by the<br />
Defendants. The cause of action as alleged<br />
by the Plaintiff arose on the publication of<br />
an article in the weekly magazine,<br />
“Outlook”, which is edited, published and<br />
authored by the Defendants.<br />
This writ petition has been filed in the<br />
nature of public interest litigation against<br />
the Defendants. The Petitioner has alleged<br />
the Respondents of publishing article in<br />
their Weekly magazine “Outlook” that<br />
contained discussion on sexually explicit<br />
material which was very embarrassing.<br />
The Petitioner has prayed for a writ of<br />
mandamus to be issued to the Union of<br />
India (Respondent No. 3) and Press<br />
Council of India (Respondent No. 4) for<br />
the formulation of a comprehensive set of<br />
laws to regulate the publication of<br />
sexually explicit material in the<br />
magazines.<br />
This suit has been filed for damages and<br />
compensation for the alleged defamation<br />
of the Plaintiff caused by the Defendants.<br />
The cause of action as alleged by the<br />
Plaintiff arose on the publication of an<br />
article in the weekly magazine,<br />
“Outlook”, which is edited, published and<br />
authored by the Defendants.<br />
This suit has been filed for damages and<br />
compensation for the alleged defamation<br />
and breach of confidence of the Plaintiff<br />
caused by the Defendants. The cause of<br />
action as alleged by the Plaintiff arose on<br />
the publication of the interview of the<br />
Plaintiff in the weekly magazine,<br />
“Outlook”, which is edited, published and<br />
authored by the Defendants.<br />
This application has been filed for<br />
restoration of the suit which was filed for<br />
the recovery of damages on account of<br />
alleged defamation of the Plaintiff caused<br />
by the Defendants. The cause of action<br />
as alleged by the Plaintiff arose on<br />
publication of an interview of the Plaintiff<br />
in the weekly magazine, “Outlook” which<br />
is edited, published and authored by the<br />
Defendants.<br />
This suit has been filed for recovery of<br />
damages on account of alleged defamation<br />
of the Plaintiff caused by the Defendants.<br />
The cause of action as alleged by the<br />
Plaintiff arose on publication of an<br />
article in the weekly magazine, “Outlook”<br />
which is edited, published and authored<br />
by the Defendants.<br />
20.50<br />
Not<br />
quantifiable<br />
10.00<br />
10.00<br />
20.00<br />
10,000.00<br />
Criminal Cases filed against the Outlook Publishing (India) Private Limited<br />
Sr. Parties Authority Case Brief particulars of the Amount of<br />
183
No.<br />
1. Air Marshal<br />
Harish Masand<br />
(the<br />
“Complainant”)<br />
v/s. “The Weekly<br />
news magazine<br />
Outlook” (the<br />
“Accused No. 1”),<br />
“Vinod Mehta,<br />
Editor-in-Chief”<br />
(the “Accused No.<br />
2”), “Sandipen<br />
Deb, Managing<br />
Editor” (the<br />
“Accused No. 3”)<br />
and “Saikat Dutta<br />
, Author of Air of<br />
Uncertainty” (the<br />
“Accused No.4”)<br />
2. Vinod Mehta,<br />
Editor-in-Chief of<br />
Outlook<br />
Magazine&<br />
Others (the<br />
“Applicants”) v/s.<br />
State of<br />
Maharashta and<br />
C. Antony Louis<br />
(the<br />
“Respondents”)<br />
Before<br />
which<br />
Pending<br />
High<br />
Court of<br />
Judicature<br />
at New<br />
Delhi<br />
High<br />
Court of<br />
Judicature<br />
at New<br />
Delhi<br />
Number Suit/Appeal/Case/Notice/Proceeding Claimed<br />
involved<br />
1168/1/2005<br />
of 2005<br />
Criminal<br />
Application<br />
No. 2240 of<br />
2007<br />
This complaint has been filed under<br />
Sections 500, 501 and 502 under the<br />
Indian Penal Code on the charges of<br />
alleged defamation. The cause of action<br />
as alleged by the Plaintiff rose on the<br />
publication of an article in the weekly<br />
magazine, “Outlook”, which is edited,<br />
published and authored by the<br />
Defendants.<br />
This application has been filed against<br />
the order of the Sessions Court. The<br />
application has been filed to get the FIR<br />
No. 03/2007 quashed which was lodged<br />
against an article in the Weekly<br />
magazine “Outlook” which is run by the<br />
Applicants.<br />
Not<br />
quantifiable<br />
Not<br />
quantifiable<br />
Labour Cases filed against the Outlook Publishing (India) Private Limited<br />
Sr.<br />
No.<br />
Parties<br />
1 Mr. Venu<br />
Menon (the<br />
“Worker”) v/s<br />
Outlook<br />
Publishing<br />
(India) Private<br />
Limited (the<br />
“Company”)<br />
Authority<br />
Before<br />
which<br />
Pending<br />
Industrial<br />
Court,<br />
Kollam<br />
Case<br />
Number<br />
Industrial<br />
Dispute<br />
number 1<br />
of 2003<br />
Brief particulars of the<br />
Suit/Appeal/Case/Notice/Proceeding<br />
The worker has filed this suit against the<br />
company for reinstatement in services with<br />
back wages after being dismissed from<br />
services by payment of three months<br />
wages on account of closure of business in<br />
Trivandrum district. The suit is pending<br />
before the Industrial Court.<br />
Amount<br />
Claimed<br />
involved<br />
of<br />
2.00<br />
(approximately)<br />
4. Innovassynth Technologies (I) Limited<br />
Labour cases filed against Innovassynth Technologies (India) Limited<br />
Sr.<br />
No.<br />
Parties<br />
1. M/s Shree<br />
Enterprises &<br />
Innovassynth<br />
Technologies<br />
(India) Limited<br />
(the “First Party”)<br />
Authority<br />
Before<br />
Which<br />
Pending<br />
Labour<br />
Court at<br />
Mahad.<br />
Case<br />
Number<br />
Reference<br />
application<br />
number<br />
REF (IDA)<br />
5/20<br />
Brief Particulars of<br />
Suit/Appeal/Case/Notice/Proceeding<br />
This case has been filed by the Second<br />
Party on the alleged illegal termination<br />
of the Second Party by the First Party<br />
with effect from December 23, 2004.<br />
The Second Party has thus prayed that<br />
the alleged illegal termination by the<br />
Amount<br />
Claim<br />
Involved<br />
Not<br />
quantifiable<br />
of<br />
184
v/s Gautam<br />
Kashinath Rokde<br />
(the “Second<br />
Party”)<br />
2. Mr. Sanjay<br />
Sadanand Patil<br />
and Mr. Aziz<br />
Hasan Khot (the<br />
“Complainants”)<br />
v/s M/s<br />
Innovassynth<br />
Technologies<br />
(India) Limited<br />
and others (the<br />
“Respondent”)<br />
3. Innovassynth<br />
Technologies<br />
(India) Limited<br />
(the “First Party”)<br />
v/s Hemant<br />
Balkrishna<br />
Nalavade (the<br />
“Second Party”)<br />
4. Pandurang<br />
Raghunath Patil<br />
(the<br />
“Complainant”)<br />
v/s Futura<br />
Polyesters<br />
,Limited (the<br />
“Respondent”)*<br />
*The case<br />
mentioned above<br />
is currently<br />
pending against<br />
Innovassynth<br />
Technologies<br />
(India) Limited<br />
since it was filed<br />
when<br />
Innovassynth<br />
Technologies<br />
(India) Limited<br />
was Khopoli<br />
division of our<br />
Company and not<br />
a separate entity.<br />
The same was<br />
transferred<br />
pursuant to the<br />
incorporation of<br />
Innovassynth<br />
Technologies<br />
(India) Limited as<br />
a seperate<br />
company.<br />
5. Praful Anant<br />
Gaikwad (the<br />
“Petitioner”) v/s<br />
Industrial<br />
Court,<br />
Thane<br />
Labour<br />
Court,<br />
Mahad<br />
Industrial<br />
Court at<br />
Kolhapur<br />
High<br />
Court of<br />
Judicature<br />
Complaint<br />
number<br />
(U.L.P.)<br />
No. 327 of<br />
2001<br />
REF (IDA)<br />
No.<br />
226/2001.<br />
Complaint<br />
(ULP) No.<br />
261/2002.<br />
Contempt<br />
Petition<br />
no. 276 of<br />
First Party be set aside and the Second<br />
Party be reinstated and the back wages<br />
from the date of termination till the<br />
resumption of his service be paid<br />
This Complaint has been filed against<br />
the alleged illegal termination of the<br />
Complainants by the Respondents with<br />
effect from February 12, 2000. The<br />
Complainants thus pray for the alleged<br />
illegal termination to be set aside and<br />
the Complainants be reinstated in their<br />
services and the back wages from the<br />
date of termination till the resumption<br />
of his service be paid along with the<br />
arrears arising from the revision in pay<br />
and other benefits be paid to the Second<br />
Party<br />
This case has been filed against the<br />
alleged illegal termination of the<br />
Second Party by the First Party with<br />
effect from April 09, 1997. The Second<br />
Party has thus prayed that the alleged<br />
illegal termination be set aside and the<br />
Second Party be reinstated in the<br />
service and the back wages be paid to<br />
the Second Party<br />
This complaint has been filed against<br />
the alleged illegal termination of the<br />
Complainants by the Respondents. The<br />
Complainant has alleged that the<br />
Respondent has indulged in Unfair<br />
Labour Practices by allegedly denying<br />
the compensation under the voluntary<br />
retirement scheme as promised to the<br />
Complainant. The Complainant has thus<br />
prayed that the Respondent be directed<br />
to pay the benefits of voluntary<br />
retirement scheme.<br />
This application for contempt has been<br />
filed against the alleged disobedience<br />
of the orders passed by the Labour and<br />
Not<br />
quantifiable<br />
Not<br />
quantifiable<br />
3.50<br />
Not<br />
quantifiable<br />
185
Innovassynth<br />
Technologies<br />
(India) Limited<br />
(the<br />
“Respondent”)<br />
6. Anil Pandurang<br />
Gaikwad & others<br />
(the<br />
“Complainants”)<br />
v/s Innovassynth<br />
Technologies<br />
(India) Limited &<br />
others (the<br />
“Respondents”)<br />
7. Innovassynth<br />
Technologies<br />
(India) Limited<br />
(the “Applicant”)<br />
v/s Rajendra<br />
Vasant Chorge &<br />
S.M More,<br />
Presiding officer,<br />
Labour Court,<br />
Mahad (the<br />
“Respondent 1&<br />
2”)<br />
at<br />
Bombay<br />
Industrial<br />
Court,<br />
Thane<br />
High<br />
Court of<br />
Bombay<br />
2007 the Industrial Court. The Labour Court<br />
through its order dated April 27, 2006<br />
had ordered for the reinstatement of the<br />
Petitioner into his service. The same<br />
was upheld by the Industrial Court<br />
through its order dated April 09, 2007.<br />
The Petitioner has thus alleged that he<br />
has not been reinstated even after the<br />
court orders have been passed in his<br />
favour.<br />
Complaint<br />
(U.L.P) no.<br />
574 of<br />
2000<br />
Letter<br />
Patent<br />
Appeal No<br />
29 of 2008<br />
in Writ<br />
Petition<br />
No5016 of<br />
2006.<br />
This complaint has been filed against<br />
the alleged illegal termination of the<br />
Complainants by the Respondent. The<br />
Complainants have alleged that the<br />
Respondent has indulged in unfair<br />
labour practices by denying the<br />
compensation under the voluntary<br />
retirement scheme as claimed to be<br />
promised to the Complainant. The<br />
Complainant thus prays for<br />
reinstatement in his service.<br />
This Appeal has been filed against the<br />
order dated December 27, 2005 passed<br />
by Respondent No.2. The Respondent<br />
No.2 has passed an order to reinstate<br />
Respondent no.1 who was allegedly<br />
terminated illegally. The Appellant has<br />
filed this appeal to set aside the order of<br />
the Respondent no.2.<br />
Entire back<br />
wages from<br />
the date of the<br />
said<br />
termination<br />
till the<br />
resumption of<br />
his<br />
services/Nonquantifiable<br />
Entire back<br />
wages from<br />
the date of the<br />
said<br />
termination<br />
till the<br />
resumption of<br />
his<br />
services/Not<br />
quantifiable<br />
Tax cases filed against Innovassynth Technologies (India) Limited<br />
Sr.<br />
No<br />
Parties<br />
1. Innovasynth<br />
Technologies<br />
(India) Limited<br />
(the<br />
“Appellant”)<br />
v/s The<br />
Commissioner<br />
of Central<br />
Excise (the<br />
“Respondent”)<br />
2. Futura<br />
Polyesters<br />
Limited (the<br />
“Appellant”)<br />
v/s<br />
Commissioner<br />
of Central<br />
Excise (the<br />
“Respondent”)<br />
Authority<br />
Before Which<br />
Pending<br />
Customs,<br />
Excise and<br />
Service Tax<br />
Appellate<br />
Tribunal (the<br />
“CESTAT”)<br />
Customs,<br />
Excise<br />
Service<br />
Appellate<br />
Tribunal<br />
and<br />
Tax<br />
Case<br />
Number<br />
Appeal<br />
number<br />
E/629/07<br />
Appeal<br />
number<br />
3677/03 of<br />
2003<br />
Brief Particulars of<br />
Suit/Appeal/Case/Notice/Proceeding<br />
This Appeal has been filed against the<br />
order-in-appeal<br />
number<br />
AT/831/RGD/2006 dated February 5,<br />
2007 passed by the Commissioner of<br />
Central Excise (Appeals)challenging the<br />
decision that the Appellants was liable<br />
to pay a differential duty under Rule<br />
3(4) of Cenvat Credit Rules, 2002<br />
However, the CESTAT vide order<br />
number S/538/2007/CI/EB has waived<br />
and stayed the recovery of pre-deposit<br />
of interest and penalty pending the<br />
appeal as the duty demand of Rs.<br />
1,92,824 has been duly paid.<br />
This appeal has been filed against the<br />
order in appeal number RJB/M-<br />
III/265/2003 dated August 28, 2003<br />
passed by the Commissioner of Central<br />
Excise (Appeal). The alleged grounds of<br />
the appeal are stated herein below<br />
1. The duty amount of Rs. 13,48,142<br />
cannot be demanded in absence of<br />
recovery provisions.<br />
Amount<br />
of Claim<br />
Involved<br />
1.93<br />
13.48<br />
186
2. The Respondent has failed to<br />
consider that Rule 57CC of Central<br />
Excise Rules, 1944 envisages the<br />
reversal of MODVAT credit taken in<br />
respect of duty paid inputs, which<br />
are subsequently utilised in the<br />
manufacture of the exempted goods.<br />
3. Since there is no existence of sale,<br />
provisions of Rule 57CC of the<br />
Central Excise Rules, 1944 does not<br />
apply.<br />
4. Value under Rule 57CC cannot be<br />
determined as per Section 4 of 4A of<br />
the Central Excise Act<br />
3. Innovasynth<br />
Technologies<br />
(India) Limited<br />
(the<br />
“Appellant”)<br />
v/s Khopoli<br />
Municipal<br />
Council,<br />
Khopoli (the<br />
“Respondent”)<br />
4. Superintendent<br />
of Central<br />
Excise (the<br />
“Assessor”) v/s<br />
Innovasynth<br />
Technologies<br />
(India) Limited<br />
(the “Assesse”<br />
)<br />
Court of<br />
Judicial<br />
Magistrate<br />
First Class,<br />
Khalapur.<br />
Superintendent<br />
of Central<br />
Excise,<br />
Khopoli Range<br />
-I<br />
Miscellaneous<br />
Appeal No.<br />
25/2006 of<br />
2006<br />
F No. V/.ADj<br />
(SCN) 15-<br />
480/M-<br />
VII/01/1543<br />
5. The circular number 591/28/2001-<br />
CX dated October 16, 2001 is<br />
applicable<br />
This application has been filed for the<br />
readmission of the appeal originally<br />
numbered M.A No. 1/99. The appeal<br />
was filed for the setting aside of the Bill<br />
No. 4134 dated April 19, 1999 served<br />
on the Appellant by the Respondent for<br />
the outstanding Octroi duty. The same<br />
was alleged to be illegal by the<br />
Appellant.<br />
The Assesse through this show cause<br />
notice dated January 1, 2002 has been<br />
asked to justify why a sum of Rs.<br />
3,08,810 should not be demanded and<br />
recovered from them in contravention of<br />
Rule 9(2) of the Central Excise Rules,<br />
1944.<br />
7.74<br />
3.80<br />
5. Chika Private Limited<br />
Income tax cases filed against Chika Private Limited<br />
Sr.<br />
No<br />
Parties<br />
1. Commissioner of<br />
Income Tax (the<br />
“Appellant”) v/s.<br />
Chika Private<br />
Limited (the<br />
“Respondent”)<br />
Authority<br />
Before<br />
Which<br />
Pending<br />
High Court<br />
of<br />
Judicature<br />
at Bombay<br />
Case<br />
number<br />
Reference<br />
Application<br />
Number<br />
1704/M/98<br />
Brief Particulars of<br />
Suit/Appeal/Case/Notice/Proceeding<br />
This reference application has arisen out of the order<br />
dated August 31, 1998, passed by the Income Tax<br />
Appellate Tribunal. The Income Tax Appellate<br />
Tribunal through this application has sought the<br />
opinion of the High Court of Judicature at Bombay,<br />
whether it was right in holding the indenting<br />
commission to be includible in export profits under<br />
Section 80HHC of the Income Tax Act, 1961<br />
6. Distributors (Bombay) Private Limited<br />
Income tax cases filed against Distributors (Bombay) Private Limited<br />
Sr.<br />
No<br />
Parties<br />
Authority<br />
Before<br />
Case number Brief Particulars of<br />
Suit/Appeal/Case/Notice/Proceeding<br />
187
1. Commissioner of<br />
Income Tax (the<br />
“Appellant”) v/s.<br />
Distributors<br />
(Bombay) Private<br />
Limited (the<br />
“Respondent”)<br />
Which<br />
Pending<br />
High Court<br />
of<br />
Judicature<br />
at Bombay<br />
Appeal number<br />
ITXAL/1604/2006<br />
This appeal has been filed against the order dated<br />
March 10, 2006 passed by the Income Tax<br />
Appellate Tribunal. The Tribunal had upheld the<br />
order passed by the Commissioner of Income-Tax<br />
(Appeals) in relation to the assessment order for<br />
the year 2002-2003 wherein the taxable income of<br />
the respondent was calculated at Rs. 21,11,120/-.<br />
This Appeal is for the Restoration of the<br />
Assessment order for the year 2003-2004.<br />
7. Bhupati Investment & Finance Private Limited<br />
Income tax cases filed against Bhupati Investment & Finance Private Limited<br />
Sr.<br />
No<br />
Parties<br />
1. Additional<br />
Commissioner of<br />
Income Tax (the<br />
“Appellant”) v/s.<br />
Bhupati Investment<br />
& Finance Private<br />
Limited (the<br />
“Respondent”)<br />
Authority<br />
Before<br />
which<br />
Pending<br />
Income Tax<br />
Appellate<br />
Tribunal,<br />
Case<br />
Number<br />
Income tax<br />
appeal<br />
number ITA<br />
No.<br />
3098/M/02<br />
Brief particulars of the<br />
Suit/Appeal/Case/Notice/Proceeding<br />
This appeal has been filed against the order dated<br />
March 11, 2002 passed by Commissioner of<br />
Income Tax (Appeals) praying for the restoration<br />
of the assessment order passed by the Appellant<br />
for the Assessment Year 1988-1989, and for the:<br />
1. Addition of long term capital loss on the sale<br />
of shares. Amount to be mentioned<br />
2. Deletion of the deemed interest of Rs.<br />
46,31,471<br />
188
8. Asianet Satellite Communications Limited<br />
Civil cases filed against Asianet Satellite Communications Limited<br />
Sr.<br />
No<br />
Parties Authority before<br />
which pending<br />
1. Roy Morera and<br />
Startech<br />
Network (the<br />
“Petitioner”) v/s<br />
Asianet Satellite<br />
Communications<br />
Limited (the<br />
“Respondent”)<br />
2. Poornima Rao<br />
(the<br />
“Appellant”) v/s<br />
Asianet Satellite<br />
Communications<br />
Limited (the<br />
“Respondent”)<br />
3. K. G Sabu and<br />
others (the<br />
“Plaintiffs”) v/s<br />
C.S Satheesan<br />
and others (the<br />
“Defendants”)<br />
4. Elsy Yohannan,<br />
Aroma Yohanna<br />
and Abiya<br />
Yohanna (the<br />
“Appellants”)<br />
v/s Asianet<br />
Satellite<br />
Communications<br />
Limited and<br />
New India<br />
Assurance<br />
Company<br />
Limited (the<br />
“Respondents”)<br />
Court of District<br />
Judge,<br />
Thiruvananthapuram<br />
Court of District<br />
Judge,<br />
Thiruvananthapuram<br />
Court<br />
of<br />
Subordinate Judge,<br />
Paravor.<br />
Court<br />
of<br />
Subordinate Judge,<br />
Kottarakara.<br />
Case<br />
Number<br />
OP [ARB]<br />
281/2006<br />
A. S No.<br />
28/2006<br />
I. A No<br />
2878/2006<br />
in O.S No.<br />
383/2006<br />
A.S No<br />
100 of<br />
2006<br />
Brief Particulars of<br />
Suit/Appeal/Case/Notice/Proceeding<br />
This petition has been filed for setting<br />
aside the award dated August 3, 2006<br />
passed by the sole arbitrator. The<br />
Petitioner has alleged that the<br />
Petitioner and the Respondent had<br />
entered into a franchisee agreement<br />
dated June 28, 2000 wherein it was<br />
agreed that the Petitioner would wind<br />
up his own cable network and would<br />
convert as a franchisee of the<br />
Respondent, subsequent to the<br />
establishment of the cable network by<br />
the Respondent The Petitioner has<br />
further alleged that the Respondent<br />
has acted in contravention of the<br />
covenants of the agreement.<br />
This appeal has been filed against the<br />
order of the Munsiff Court dated April<br />
6, 2005. The Appellant in this appeal<br />
has alleged that that the Respondent<br />
had violated the license agreement<br />
dated December 04, 2000 pursuant to<br />
which a suit for recovery and<br />
mandatory injunction was filed before<br />
the Munsif Court which was decreed<br />
in favour of the Respondents. The<br />
Appellant thus prays that order of the<br />
lower court be set aside and the claim<br />
of the Appellant be accepted.<br />
This plaint has been filed for an<br />
interim injunction, to restrain the<br />
Defendants from receiving the money<br />
due to Globe Vision, a partnership<br />
firm formed between the Plaintiffs<br />
and the Defendants. Asianet Satellite<br />
Communications Limited (Defendant<br />
No. 4) is a proforma party and no<br />
relief is sought against it.<br />
This appeal has been filed for setting<br />
aside the order of the Munsiff Court<br />
in O.S No 605 of 2004 dated June 28,<br />
2006 The Appellant no. 1 in this<br />
appeal has claimed that she was made<br />
the nominee in the insurance policy<br />
subscribed by her husband and thus<br />
she was entitled to receive a sum of<br />
Rs. 50,000 after the death of her<br />
husband which was denied to the<br />
Appellant, pursuant to which a suit for<br />
recovery was filed before the Munsif<br />
Court which was decreed in favour of<br />
the Respondents. It has been<br />
therefore, prayed by the Appellants,<br />
that the order of the lower court be set<br />
aside.<br />
Amount of<br />
claim<br />
involved<br />
(Rs. In Lacs)<br />
274.00<br />
4.64<br />
Not<br />
quantifiable<br />
0.65<br />
189
5. Manikandan (the<br />
“Plaintiff’) v/s<br />
Praseed Kumar<br />
(the “Defendant<br />
No.1”) and<br />
Asianet Satellite<br />
Communications<br />
Limited (the<br />
“Defendant<br />
No.2”)<br />
6. K.J Prakash (the<br />
“Petitioner”) v/s<br />
Asianet Satellite<br />
Communications<br />
Limited (the<br />
“Respondent”)<br />
7. Jojen T.<br />
Mukkadan (the<br />
“Claimant”) v/s<br />
Asianet Satellite<br />
Communications<br />
Limited and<br />
Others (the<br />
“Respondents”)<br />
8. Titus George,<br />
Proprietor of<br />
Vaniya<br />
Satvision,<br />
Tiruvandoor<br />
Court of the<br />
Munsiff, Palakkad<br />
Arbitral Tribunal,<br />
Ernakulam<br />
IA<br />
1918/07<br />
in OS<br />
340/07<br />
A.R No. 8<br />
of 2007<br />
Sole Arbirator A.R No.<br />
31 of<br />
2004<br />
Municipal<br />
Chengannur.<br />
Court,<br />
O.S No.<br />
367/2006<br />
This suit has been filed by the<br />
Plaintiff for the recovery of an amount<br />
of Rs. 35,000 from the Defendant<br />
No.1 which he is alleged to have<br />
borrowed from the Plaintiff. The<br />
Plaintiff has further alleged that<br />
Defendant No.1 is a franchisee of the<br />
Defendant No.2 (Asianet Satellite<br />
Communications Limited) and has<br />
deposited an amount of Rs 40,000 for<br />
obtaining the franchisee rights from<br />
Defendant No. 2. The Plaintiff has<br />
claimed that since it is the only<br />
realizable asset, the same be awarded<br />
to the Plaintiff.<br />
This arbitral proceeding has been<br />
initiated for the claim of Rs.<br />
14,66,750 allegedly due to the<br />
Petitioner by the Respondent.. The<br />
Petitioner has alleged that it entered<br />
into a franchisee agreement with the<br />
Respondent dated November 25,<br />
1999, which was unilaterally<br />
terminated by the Respondent after<br />
denying the Petitioner the bill books<br />
for monthly collection from the cable<br />
subscribers, in contravention of the<br />
franchisee agreement. Further, it has<br />
been alleged by the Petitioner that<br />
despite repeated demands the<br />
Respondents did not settle the<br />
amounts with the Petitioner.<br />
This arbitral proceeding has been<br />
initiated for the claim of Rs.5,29,523<br />
due to the Claimant by the<br />
Respondent no.1. The Claimant has<br />
alleged that he had entered into a<br />
license agreement with the<br />
Respondent no.1 dated December 04,<br />
2000, wherein it was agreed that the<br />
Claimant would wind up his existing<br />
cable TV network thereby relying on<br />
the assurance that the Respondents<br />
would provide connections to the<br />
subscribers of the Claimant. The<br />
Claimant has alleged that he had<br />
remitted an amount of Rs. 15,88,570<br />
upto January 2002 in the account of<br />
the Respondents towards the<br />
subscription charges out of which Rs.<br />
5,29,523 had to be paid to the<br />
Claimant as his share of subscription<br />
fee in accordance with the terms of<br />
the agreement. The Claimant has<br />
further alleged that the Respondents<br />
have acted in contravention of the<br />
agreement and his share of<br />
subscription fee was not paid to him<br />
despite repeated requests.<br />
This complaint has been filed for the<br />
permanent injunction to restore the<br />
cable signal provided by the<br />
Defendant no.1. The Complainant and<br />
the Defendant No.1 had tied up for the<br />
Not<br />
quantifiable<br />
14.67 and<br />
18% interest<br />
on the<br />
amount<br />
aggregating<br />
to Rs. 21.04<br />
115.00<br />
Not<br />
quantifiable<br />
190
Village (the<br />
“Complainant”)<br />
v/s Asianet<br />
Satellite<br />
Communications<br />
Limited &<br />
Another (the<br />
“Defendants”)<br />
9. G Anitha<br />
Prakash and<br />
others (the<br />
“Appellants”)<br />
v/s Kerala State<br />
Electricity<br />
Board and others<br />
(the<br />
“Respondents”).<br />
10. Praveen<br />
Mathew (the<br />
“Petitioner”) v/s<br />
Kerala State<br />
Electricity<br />
Board and others<br />
(the<br />
“Respondents”)<br />
11. Cable TV<br />
Operators<br />
Association (the<br />
“Petitioner”) v/s<br />
Kerala State<br />
Electrcity Board<br />
and Others (the<br />
“Respondents”).<br />
12. Cable TV<br />
Operators<br />
Association (the<br />
“Petitioner”) v/s<br />
Kerala State<br />
Electrcity Board<br />
and Others (the<br />
“Respondents”)<br />
13. `R. B Anilkumar<br />
(the<br />
“Petitioner”) v/s<br />
Kerala State<br />
Electricity<br />
Board and others<br />
(the<br />
“Respondents”)<br />
14. P. Surendran<br />
(the<br />
“Petitioner”)v/s<br />
Kerala state<br />
Electricity<br />
Board and others<br />
High Court of<br />
Judicature at Kerala,<br />
Ernakulam.<br />
High Court of<br />
Judicature at Kerala,<br />
Ernakulam.<br />
High Court of<br />
Judicature at Kerala,<br />
Ernakulam.<br />
High Court of<br />
Judicature at Kerala,<br />
Ernakulam.<br />
High Court of<br />
Judicature at Kerala,<br />
Ernakulam<br />
High Court of<br />
Judicature at Kerala,<br />
Ernakulam<br />
Original<br />
Petition<br />
No. 32144<br />
of 2002.<br />
WP (C)<br />
No. 17057<br />
of 2005.<br />
WP (C)<br />
No. 11455<br />
of 2006<br />
WP (C)<br />
No. 36521<br />
of 2005<br />
W.P No.<br />
7709/2006<br />
W.P No.<br />
7690/2006<br />
cable transmission business. The<br />
Defendant No.1 had allegedly<br />
withdrawn the signal provided to the<br />
Complainant in contravention of the<br />
order passed by the High Court<br />
The original petition was filed against<br />
the Respondents for alleged<br />
dismantling of the cable TV lines<br />
drawn by the Appellant No.1 through<br />
electric poles. The original petition<br />
and the subsequent revision petition<br />
were dismissed, hence this restoration<br />
petition.<br />
This petition challenges the right of<br />
Asianet Satellite Communications<br />
Limited to draw the cable TV lines<br />
through the electric poles after the<br />
expiry of the agreement to the effect<br />
between Kerala State Electricity<br />
Board (Respondent no.1) and Asianet<br />
Satellite Communications Limited<br />
(Respondent No.3).<br />
This petition has been filed for a writ<br />
of mandamus to be issued to Kerala<br />
State Electricity Board (Respondent<br />
no.1) to stop Asianet Satellite<br />
Communications<br />
Limited<br />
(Respondent no.5) from allegedly<br />
drawing cable TV lines through<br />
electric poles without entering into a<br />
valid agreement and vitiating the<br />
procedure of competitive tenders.<br />
This petition has been filed to issue a<br />
writ of mandamus directing Kerala<br />
State Electricity Board (Respondent<br />
no.1) to prevent Asianet Satellite<br />
Communications<br />
Limited<br />
(Respondent no.5) from drawing<br />
cable TV lines from electric poles<br />
without paying the pole rental and to<br />
ensure that the Respondent no. 5 does<br />
not draw cable TV lines through poles<br />
already allotted to other cable TV<br />
operators.<br />
This petition has been filed for a writ<br />
of mandamus to be issued to Kerala<br />
State Electricity Board (Respondent<br />
No. 1) to prevent Asianet Satellite<br />
Communications<br />
Limited<br />
(Respondent no.5) from allegedly<br />
drawing cable TV lines :<br />
i) without due authorisation and;<br />
ii) without participating in the<br />
auction cum tender.<br />
This petition has been filed for a writ<br />
of Mandamus to be issued to the<br />
Respondents 1 to 6 to intimate the<br />
Petitioner of the rental arrears in<br />
relation to the drawing of the cable<br />
TV lines from the electric poles. The<br />
Not<br />
quantifiable<br />
No<br />
quantifiable<br />
Not<br />
quantifiable<br />
Not<br />
quantifiable<br />
Not<br />
quantifiable<br />
Not<br />
quantifiable<br />
191
(the<br />
“Respondents”).<br />
15. Rajalakshmi<br />
Ragunath (the<br />
“Appellant”) v/s<br />
Asianet Satellite<br />
Communications<br />
Limited and<br />
others (the<br />
“Respondent”)<br />
16. Vasantha Sekhar<br />
(the<br />
“Complainant”)<br />
v/s The<br />
Chairman of<br />
Asianet Satellite<br />
Communications<br />
Limited and The<br />
Manager of New<br />
India Assurance<br />
Company<br />
Limited (the<br />
“Opposite<br />
Parties”)<br />
17. K.M<br />
Sreedevikutty<br />
(the<br />
“Complainant”)<br />
v/s Asianet<br />
Satellite<br />
Communications<br />
Limited and The<br />
Senior<br />
Divisional<br />
Manager, New<br />
India Assurance<br />
Company<br />
Limited (the<br />
“Respondents”)<br />
18. Narayanan<br />
Payyamballi (the<br />
“Complainant”)<br />
v/s The<br />
Manager, Indian<br />
Overseas bank<br />
(the “First<br />
Opposite Party”)<br />
and The<br />
High Court of<br />
Judicature at Kerala,<br />
Ernakulam.<br />
DistrictConsumer<br />
Disputes Redressal<br />
Forum,<br />
Thiruvananthapuram<br />
District Consumer<br />
Disputes Redressal<br />
Forum,<br />
Thiruvananthapuram<br />
Consumer Disputes<br />
Redressal Forum,<br />
Kannur<br />
Regular<br />
Second<br />
Appeal<br />
no. 1100<br />
of 2006.<br />
Consumer<br />
Complaint<br />
No. 382<br />
of 2005<br />
Complaint<br />
No. 87 of<br />
2005<br />
Original<br />
Petition<br />
number<br />
327 of<br />
2003<br />
Petitioner alleges the Respondent no.<br />
1 to 5 of acting in contravention of the<br />
guidelines for allotting electric poles<br />
for drawing cable TV lines framed as<br />
per the directions of the High Court of<br />
Judicature at Kerala. It has been<br />
further alleged by the Petitioner that<br />
the Respondent No. 1 has permitted<br />
Respondent No. 6 (Asianet Satellite<br />
Communications Limited) to draw<br />
lines using electric poles but refused<br />
to permit other cable TV operators,<br />
thereby indicating the biasness in the<br />
allotment of electric poles.<br />
This appeal has been filed against the<br />
orders of the Munsiff Court dated<br />
June 21, 2003 in the O.S No. 25/2002<br />
and Additional District and Sessions<br />
Court in A.S No. 54/2003 dated<br />
September 15, 2006. This appeal<br />
arises from the suit filed for a<br />
prohibitory injunction thereby<br />
restraining the Respondent No. 1 from<br />
disconnecting the cable connection<br />
which the Appellant in the present<br />
appeal had subscribed for.<br />
This complaint dated October 27,<br />
2005 has been filed for the recovery<br />
of the amount accrued to the<br />
Complainant under the insurance<br />
scheme introduced by the Opposite<br />
parties. The Complainant has alleged<br />
that she was made the nominee in the<br />
insurance scheme subscribed by her<br />
daughter. Further, it has been alleged<br />
that she was entitled to receive a sum<br />
of Rs. 50,000 after the death of the<br />
daughter which was not disbursed to<br />
the Complainant and therefore<br />
amounted to deficiency in service.<br />
This complaint dated March 04, 2005<br />
has been filed for the recovery of the<br />
amount allegedly accrued to the<br />
Complainant under the insurance<br />
scheme introduced by the Opposite<br />
parties. The Complainant has alleged<br />
that she was made the nominee in the<br />
insurance scheme subscribed by her<br />
husband. Further, it has been alleged<br />
that she was entitled to receive a sum<br />
of Rs. 50,000 after the death of her<br />
husband which was not disbursed to<br />
the Complainant and therefore,<br />
resulted in mental agony to the<br />
Complainant<br />
This complaint has been filed on<br />
account of the alleged negligence by<br />
the First Opposite Party. The<br />
Complainant was an employee in<br />
Kuwait and in order to subscribe to<br />
the NRI privilege scheme introduced<br />
by the Second Opposite party had sent<br />
an application form along with a bank<br />
authorisation form authorising the<br />
Not<br />
quantifiable<br />
0.50 and 0.25<br />
as<br />
compensation<br />
for<br />
deficiency in<br />
service.<br />
0.50 and 0.50<br />
as<br />
compensation<br />
for mental<br />
agony and<br />
loss<br />
Nil<br />
192
Managing<br />
Director,<br />
Asianet Satellite<br />
Communication<br />
Limited (the<br />
“Second<br />
Opposite Party”)<br />
First Opposite Party to pay a sum of<br />
USD 500 towards the subscription<br />
fees for the said scheme to the Second<br />
Opposite Party on April 9, 1994. The<br />
same as alleged by the Complainant<br />
was not remitted to the Second<br />
Opposite Party. Thus, the<br />
Complainant has prayed for a sum of<br />
Rs. 79,350/- towards losses sustained,<br />
compensation for mental agony and<br />
the original amount of subscription<br />
fee to be paid by the First Opposite<br />
Party. The Second Opposite party has<br />
been impleaded as a proforma party<br />
and no relief is claimed against the<br />
Second Opposite party.<br />
Tax cases filed against Asianet Satellite Communication Limited<br />
Sr.<br />
No<br />
Parties<br />
1. Asianet Satellite<br />
Communications<br />
Limited (the<br />
“Petitioner”) v/s<br />
Settlement<br />
Commission &<br />
Others (the<br />
“Respondents”)<br />
Authority<br />
Before<br />
which<br />
Pending<br />
High Court<br />
of<br />
Judicature<br />
Kerala,<br />
Ernakulam<br />
Case<br />
number<br />
O.P No<br />
27493<br />
of 2002<br />
Brief Particulars of<br />
Suit/Appeal/Case/Notice/Proceeding<br />
This writ petition dated September 24, 2002<br />
has been filed by the Petitioner following the<br />
order dated August 13, 2002 passed by the<br />
Respondent No. 1. The Respondent No. 1 vide<br />
the said order directed the Petitioner to pay a<br />
differential duty of Rs. 1,94,00,860 on account<br />
of the alleged default by the Petitioner in<br />
fulfilling its export obligation under the<br />
Export Promotion <strong>Capital</strong> Goods (EPCG)<br />
license within the stipulated time. The<br />
Petitioner has prayed that a writ of Certiorari<br />
thereby quashing the above mentioned order<br />
be passed<br />
Amount<br />
of<br />
Claim.<br />
194.00<br />
193
9. H&R Johnson (India) Limited<br />
Cases filed against H&R Johnson (India) Limited involving monetary liability of Rs. 10 Lacs and above<br />
Consumer cases filed against H&R Johnson (India) Limited<br />
Sr.<br />
No.<br />
Parties<br />
1. Shabeer Mandoli<br />
(the<br />
“Complainant”)<br />
v/s M/s Kalliyath<br />
Sanitary Centre,<br />
H&R Johnson<br />
(India) Limited<br />
and Mr. C.<br />
Upendran (the<br />
“Opposite<br />
Parties”)<br />
Authority<br />
before<br />
which<br />
pending<br />
Consumer<br />
Dispute<br />
Redressal<br />
Forum,<br />
Kozikhode,<br />
Case<br />
number<br />
Consumer<br />
Complaint<br />
number<br />
196 of<br />
2006<br />
Brief Particulars of<br />
Suit/Appeal/Case/Notice/Proceeding<br />
The Complainant in this complaint has<br />
alleged that the second Opposite Party has<br />
supplied tiles to the Complainant which are<br />
of defective and inferior quality. Further, it<br />
has been alleged by the Complainant that<br />
he has sustained loss, injury and hardship<br />
on the account of negligence, deficiency in<br />
service and unfair trade practice on the part<br />
of the second Opposite Party.<br />
Amount<br />
of claim<br />
involved<br />
(Rs. in<br />
lacs)<br />
10.00<br />
2. V. Jaya (the<br />
“Complainant”)<br />
v/s H&R Johnson<br />
(India) Limited<br />
and Sabari<br />
Enterprises (the<br />
“Opposite<br />
Parties”)<br />
District<br />
Consumer<br />
Dispute<br />
Redressal<br />
Forum,<br />
Chennai<br />
(South)<br />
Consumer<br />
Complaint<br />
number 23<br />
of 2008<br />
The Complainant in this complaint has<br />
alleged that the first Opposite Party has<br />
manufactured and supplied tiles to the<br />
Complainant through the second Opposite<br />
party which are of defective and inferior<br />
quality. Further, it has been alleged by the<br />
Complainant that he has sustained loss,<br />
injury and hardship on the account of<br />
negligence, deficiency in service and unfair<br />
trade practice on the part of the Second<br />
Opposite Party.<br />
14.76<br />
Labour cases filed against H&R Johnson (India) Limited.<br />
Sr. No. Parties Authority<br />
before<br />
which<br />
pending<br />
1. Shankar<br />
Sanjeeva<br />
Poojary (the<br />
“Plaintiff”) v/s<br />
H&R Johnson<br />
(India)<br />
Limited (the<br />
“Defendant”)<br />
2. Bhaskar<br />
Dnyanoba<br />
Raul (the<br />
“Plaintiff”) v/s<br />
H&R Johnson<br />
(India)<br />
Limited (the<br />
“Defendant”)<br />
Court of<br />
Civil<br />
Judge,<br />
Senior<br />
Division,<br />
Thane<br />
Court of<br />
Civil<br />
Judge,<br />
Senior<br />
Division,<br />
Thane<br />
Case<br />
Number<br />
Special<br />
Civil<br />
Suit<br />
number<br />
55 of<br />
2001<br />
Special<br />
Civil<br />
Suit<br />
number<br />
283 of<br />
2004<br />
Brief Particulars of<br />
Suit/Appeal/Case/Notice/Proceeding<br />
This suit has been filed by the Plaintiff for<br />
the recovery of money and damages<br />
aggregating to Rs. 58,15,786 arising out of<br />
the alleged default in payment by the<br />
Defendant for providing industrial canteen<br />
service to the Plaintiff. Further, it has been<br />
alleged by the Plaintiff that the Defendant<br />
had entered into an agreement with the<br />
Plaintiff for providing industrial canteen<br />
service, which had been illegally and orally<br />
terminated by the Defendant, thereby<br />
causing huge loss to the Plaintiff.<br />
This suit has been filed by the Plaintiff<br />
alleging that Defendant company<br />
compelled the Plaintiff to accept the<br />
Voluntary Retirement Scheme (“VRS”)<br />
due to the alleged unlawful closure of the<br />
factory at Thane. The Plaintiff has further<br />
alleged that the prime intention behind the<br />
closure was to raise a commercial and<br />
Amount<br />
of claim<br />
involved<br />
(Rs. in<br />
lacs)<br />
58.15 and<br />
18%<br />
interest till<br />
realization<br />
of entire<br />
amount<br />
28.15 and<br />
18%<br />
interest till<br />
realization<br />
of entire<br />
amount<br />
194
esidential township on the factory land.<br />
The Plaintiff has instituted suit claiming<br />
for:<br />
1. A declaration that the consent of the<br />
Plaintiff for the VRS was obtained by<br />
fraud and misrepresentation; and<br />
3. Nandakumar<br />
Gajanan<br />
Brahme (the<br />
“Plaintiff“) v/s<br />
H&R.<br />
Johnson<br />
(India)<br />
Limited (the<br />
“Defendant”)<br />
Court of<br />
Civil<br />
Judge,<br />
Senior<br />
Division,<br />
Thane<br />
Special<br />
Civil<br />
Suit<br />
number<br />
284 of<br />
2004<br />
2. A temporary injunction restraining the<br />
Defendant from proceeding further with<br />
the development and construction on the<br />
factory land<br />
This suit has been filed by the Plaintiff<br />
alleging that Defendant company<br />
compelled the Plaintiff to accept the<br />
Voluntary Retirement Scheme (“VRS”)<br />
due to the alleged unlawful closure of the<br />
factory at Thane. The Plaintiff has further<br />
alleged that the prime intention behind the<br />
closure was to raise a commercial and<br />
residential township on the factory land.<br />
The Plaintiff has instituted suit claiming<br />
for:<br />
28.95 and<br />
18%<br />
interest till<br />
realization<br />
of entire<br />
amount<br />
1. A declaration that the consent of the<br />
Plaintiff for the VRS was obtained by<br />
fraud and misrepresentation; and<br />
4. Mahadeo<br />
Soma<br />
Venurlekar<br />
(the<br />
“Plaintiff”) v/s<br />
H&R.<br />
Johnson<br />
(India)<br />
Limited (the<br />
“Defendant”)<br />
Court of<br />
Civil<br />
Judge,<br />
Senior<br />
Division,<br />
Thane<br />
Special<br />
Civil<br />
Suit<br />
number<br />
285 of<br />
2004<br />
2. A temporary injunction restraining the<br />
Defendant from proceeding further with<br />
the development and construction on the<br />
factory land<br />
This suit has been filed by the Plaintiff<br />
alleging that Defendant company<br />
compelled the Plaintiff to accept the<br />
Voluntary Retirement Scheme (“VRS”)<br />
due to the alleged unlawful closure of the<br />
factory at Thane. The Plaintiff has further<br />
alleged that the prime intention behind the<br />
closure was to raise a commercial and<br />
residential township on the factory land.<br />
The Plaintiff has instituted suit claiming<br />
for:<br />
30.19 and<br />
18%<br />
interest till<br />
realization<br />
of entire<br />
amount<br />
1. A declaration that the consent of the<br />
Plaintiff for the VRS was obtained by<br />
fraud and misrepresentation; and<br />
5. Ankush<br />
Vishnu<br />
Vichare (the<br />
“Plaintiff’) v/s<br />
H&R Johnson<br />
(India)<br />
Limited (the<br />
“Defendant”)<br />
Court of<br />
Civil<br />
Judge,<br />
Senior<br />
Division,<br />
Thane<br />
Special<br />
Civil<br />
Suit<br />
number<br />
287 of<br />
2004<br />
2. A temporary injunction restraining the<br />
Defendant in proceeding further with<br />
the development and construction on<br />
the factory land.<br />
This suit has been filed by the Plaintiff<br />
alleging that Defendant Company<br />
compelled the Plaintiff to accept the<br />
Voluntary Retirement Scheme (“VRS”)<br />
due to the alleged unlawful closure of the<br />
factory at Thane. The Plaintiff has further<br />
alleged that the prime intention behind the<br />
closure was to raise a commercial and<br />
residential township on the factory land.<br />
The Plaintiff has instituted suit claiming<br />
for:<br />
25.11and<br />
18%<br />
interest till<br />
realization<br />
of entire<br />
amount<br />
195
1. A declaration that the consent of the<br />
plaintiff for the VRS was obtained by<br />
fraud and misrepresentation; and<br />
6. Arun Ladoba<br />
Talashilkar<br />
(the<br />
“Plaintiff”) v/s<br />
H&R Johnson<br />
(the<br />
“Defendant”)<br />
Court of<br />
Civil<br />
Judge,<br />
Senior<br />
Division,<br />
Thane<br />
Special<br />
Civil<br />
Suit<br />
number<br />
286 of<br />
2004<br />
2. A temporary injunction restraining the<br />
Defendant from proceeding further with<br />
the development and construction on the<br />
factory land<br />
This suit has been filed by the Plaintiff<br />
alleging that Defendant company<br />
compelled the Plaintiff to accept the<br />
Voluntary Retirement Scheme (“VRS”)<br />
due to the alleged unlawful closure of the<br />
factory at Thane. The Plaintiff has further<br />
alleged that the prime intention behind the<br />
closure was to raise a commercial and<br />
residential township on the factory land.<br />
The Plaintiff has instituted suit claiming<br />
for:<br />
28.58 and<br />
18%<br />
interest till<br />
realization<br />
of entire<br />
amount<br />
1. A declaration that the consent of the<br />
Plaintiff for the VRS was obtained by<br />
fraud and misrepresentation; and<br />
7. Deepak<br />
Shankar<br />
Rahatwal (the<br />
“Plaintiff”) v/s<br />
H&R Johnson<br />
(India)<br />
Limited (the<br />
“Defendant’)<br />
Court of<br />
Civil<br />
Judge,<br />
Senior<br />
Division,<br />
Thane<br />
Special<br />
Civil<br />
Suit<br />
number<br />
288 of<br />
2004<br />
2. A temporary injunction restraining the<br />
Defendant from proceeding further with<br />
the development and construction on the<br />
factory land<br />
This suit has been filed by the Plaintiff<br />
alleging that Defendant company<br />
compelled the Plaintiff to accept the<br />
Voluntary Retirement Scheme (“VRS”)<br />
due to the alleged unlawful closure of the<br />
factory at Thane. The Plaintiff has further<br />
alleged that the prime intention behind the<br />
closure was to raise a commercial and<br />
residential township on the factory land.<br />
The Plaintiff has instituted suit claiming<br />
for:<br />
29.84 and<br />
18%<br />
interest till<br />
realization<br />
of entire<br />
amount<br />
1. A declaration that the consent of the<br />
plaintiff for the VRS was obtained by<br />
fraud and misrepresentation; and<br />
8. Ramachandra<br />
Raghu<br />
Ghodke (the<br />
“Plaintiff’) v/s<br />
H&R Johnson<br />
(India)<br />
Limited (the<br />
“Defendant’)<br />
Court of<br />
Civil<br />
Judge,<br />
Senior<br />
Division,<br />
Thane<br />
Special<br />
Civil<br />
Suit<br />
number<br />
289 of<br />
2004<br />
2. A temporary injunction restraining the<br />
Defendant from proceeding further with<br />
the development and construction on the<br />
factory land<br />
This suit has been filed by the Plaintiff<br />
alleging that Defendant company<br />
compelled the Plaintiff to accept the<br />
Voluntary Retirement Scheme (“VRS”)<br />
due to the alleged unlawful closure of the<br />
company. The Plaintiff has further alleged<br />
that the prime intention behind the closure<br />
was to raise a commercial and residential<br />
township on the factory land. The Plaintiff<br />
has instituted suit claiming for:<br />
24.15 and<br />
18%<br />
interest till<br />
realization<br />
of entire<br />
amount<br />
A declaration that the consent of the<br />
plaintiff for the VRS was obtained by fraud<br />
and misrepresentation; and<br />
A temporary injunction restraining the<br />
196
Defendant from proceeding further with<br />
the development and construction on the<br />
factory land<br />
Income tax cases filed against H&R Johnson (India) Limited<br />
Sr.<br />
No.<br />
Parties<br />
1. Commissioner<br />
of Income Tax<br />
(the<br />
“Assessor”)<br />
v/s<br />
H&R.Johnson<br />
(India) Limited<br />
(the<br />
“Company”)<br />
Authority<br />
before which<br />
pending<br />
Commissioner<br />
of Income tax<br />
Details of the<br />
case<br />
CIT(C)-<br />
III/Show-<br />
Cause<br />
Notice/2007-<br />
08/121<br />
against<br />
Assessment<br />
Order dated<br />
December 29,<br />
2006 for the<br />
Assessment<br />
Year 2004-05<br />
Brief Particulars of<br />
Suit/Appeal/Case/Notice/Proceeding<br />
Our company through this show cause<br />
notice dated December 3, 2007, has been<br />
asked to justify why the Assessment<br />
Order dated December 29, 2006 passed<br />
by the Deputy Commissioner of Income<br />
Tax, should not be cancelled and a fresh<br />
assessment be directed to be framed.<br />
This show cause notice has been served<br />
by the Commissioner of Income Tax<br />
against the Assessment Order dated<br />
December 29, 2006 on the following<br />
grounds:<br />
Amount<br />
of claim<br />
involved<br />
(Rs. in<br />
lacs)<br />
305.59<br />
1. Incorrect computation of long term<br />
capital loss as Rs. 8539 pertaining to<br />
mines /mines equipment<br />
2. Incorrect valuation of fair market<br />
value of the property at Rs.<br />
1,85,35,726<br />
3. Non-compliance of the provisions of<br />
Section 80IA(3) of the Income Tax<br />
Act, 1961 (the “IT Act”) prior to<br />
allowing deduction claimed under<br />
Section 80IB of the Act.<br />
4. Disallowance of excess deduction<br />
under Section 80HHC /80IA of the<br />
IT Act.<br />
5. Reducing the deduction under<br />
Section 80HHC of the IT Act from<br />
Rs. 1,07,37,062/- to Rs. 23,07,986/-<br />
6. Allowance of writing off<br />
miscellaneous expenses substantially<br />
pertaining to non-revenue expenses<br />
amounting to Rs. 17.43 Lacs<br />
2. Joint<br />
Commissioner<br />
of Central<br />
Excise (the<br />
“Assessor”)<br />
v/s. H&R<br />
Johnson<br />
(India) Limited<br />
Joint<br />
Commissioner<br />
Central<br />
Excise,<br />
Customs and<br />
Servise Tax,<br />
Raigad<br />
V/Adj/SCN-<br />
15-<br />
101/Rgd/06<br />
dated<br />
September<br />
19, 2006<br />
7. Allowance of expenses of designing<br />
and integration of website<br />
amounting to Rs. 1.33 Lacs and the<br />
depreciation thereof.<br />
This show cause notice dated October<br />
20, 2006 has been served upon our<br />
company to justify:<br />
Why a sum of Rs. 13,40,819 which is<br />
alleged to have been utilised in<br />
contravention of Rule 9 of Central<br />
Excise Rules, 2004 read with proviso to<br />
13.40<br />
197
(the<br />
“Company”).<br />
Section 11A should not be disallowed<br />
and recovered<br />
Penalty should not be imposed on the<br />
company under Section 11AC and<br />
Interest should not be demanded and<br />
recovered from the company under<br />
Section 11AB of the Central Excise Act,<br />
1994.<br />
Given below is a summation of the cases filed against H&R Johnson (India) Limited involving a monetory<br />
liability of less than Rs. 10 Lacs each / where the same is not quantifiable<br />
i. There are 18 consumer cases pertaining to claims aggregating to approximately Rs. 28,00,000 (to the<br />
extent quantifiable) filed against H&R Johnson (India) Limited.<br />
ii.<br />
iii.<br />
iv.<br />
There are 30 labour cases pertaining to claims aggregating to approximately Rs.. 24,00,000 (to the<br />
extent quantifiable) filed against H&R Johnson (India) Limited.<br />
There is 1 civil case aggregating to approximately Rs. 3,00,000 filed against H&R Johnson (India)<br />
Limited.<br />
There are 7 tax cases, pertaining to claims aggregating to apprximately Rs. 39,00,000, filed against<br />
H&R Johnson (India) Limited.<br />
PART IV- OUTSTANDING LITIGATIONS IN RELATION TO OUR SUBSIDIARY<br />
Outstanding litigations of Innovassynth Investments Limited<br />
Nil<br />
PART V - PAST PENALTIES LEVIED IN THE LAST FIVE YEARS<br />
Other than as stated below there are no penalties imposed on our Company, Promoters, Directors and our<br />
Subsidiary in the last five years:<br />
The past cases in which penalties have been imposed on our Company in the last five years are as follows:<br />
Sr. Amount of Brief particulars regarding penalty Remarks (paid/<br />
No. penalty<br />
payable and<br />
imposed (Rs.)<br />
reasons therefore)<br />
1. Rs. 19,325 Penalty of Rs. 19,325 imposed in the Assessment Year 2005-<br />
2006 by the Commercial Tax Officer, for late payment of<br />
monthly sales tax under the provisions of the Tamil Nadu<br />
General Sales Tax Act, 1959.<br />
Paid<br />
2. Rs. 21,126 Penalty of Rs. 21,126 imposed in the Assessment Year 2005-<br />
2006 by the Commercial Tax Officer for late payment of sales<br />
tax under provisions of the Central Sales Tax Act, 1956 read<br />
with Tamil Nadu General Sales Tax Act, 1959.<br />
Paid<br />
Amounts Owed to Small Scale Undertakings<br />
As on March 31, 2008, there is no amount more than Rs. 1 lac outstanding for more than 30 days tosmall scale<br />
undertakings.<br />
The information regarding small scale industrial undertakings has been determined to the extent such parties<br />
have been identified on the basis of information available with our Company.<br />
198
Material Developments after date of last balance sheet:<br />
Except for the Scheme of Arrangement, there have been no material developments concerning our Company<br />
from the date of the last balance sheet i.e. March 31, 2008.<br />
There are no subsequent developments after the date of the last balance sheet i.e.March 31, 2008, which we<br />
believe is expected to have a material adverse impact on the reserves, profit, earnings per share and book value<br />
of our Company.<br />
199
GOVERNMENT/ STATUTORY APPROVALS<br />
Except for pending approvals mentioned under this heading, our Company has received the necessary material<br />
consents, licenses, permissions and approvals from the Government/RBI and various Government agencies<br />
required for our present business.<br />
It must, however, be distinctly understood that in granting the above approvals, the Government and other<br />
authorities do not take any responsibility for the financial soundness of our Company or for the correctness of<br />
any of the statements or any commitments made or opinions expressed.<br />
GENERAL<br />
1. Certificate of Incorporation issued by the Assistant Registrar of Companies, Maharashtra for “Indian<br />
Organic Chemicals Limited” bearing Registration number “11579” dated February 10, 1960.<br />
2. Fresh Certificate of Incorporation issued pursuant to the change of name of our Company to ‘Futura<br />
Polyesters Limited’, bearing Registration number “11-11579” by the Deputy Registrar of Companies<br />
dated November 05, 2002<br />
3. Certificate of Commencement of Business issued by the Registrar of Companies, Maharashtra for<br />
“Indian Organic Chemicals Limited” bearing Registration number “11579” dated April 22, 1960.<br />
4. Our Company’s PAN (Permanent Account Number) under the Income Tax Act is AAACCI3404K,<br />
issued by Assistant Commissioner of Income Tax.<br />
5. Our Company’s TAN (Tax Deduction Account Number) in Chennai under the Income Tax Act is<br />
CHE102036G and our Company’s TAN (Tax Deduction Account Number) in Mumbai is<br />
MUMF03450G<br />
6. Our Company’s TIN (Tax Payers Identification Number) in under the Central Sales Tax (Registration<br />
and Turnover) Rules, 1957 is 49999.<br />
7. Certificate of Registration bearing no. MH01 V 074971, dated April 01, 2006, for the registration under<br />
Maharashtra Value Added Tax Act, of our Company, with the principal place of business situated at<br />
Paragaon Condominium, 3 rd Floor, Pandurang Budhakar Marg, Mumbai-400013.<br />
8. Certificate of Enrolment under Maharahstra State Tax on Profession, Trades, Callings and Employments<br />
Act, 1975, bearing no. 1/1/27/18/5428.<br />
9. Our Company’s TIN (Tax Payers Identification Number) under the Tamil Nadu Value Added Tax Act,<br />
2002 is 33571080067.<br />
10. Our Company’s Service Tax Number for its fibre division is AAACI3404KST001<br />
11. Our Company’s Service Tax Number for its polymer division is AAACI3404KST003<br />
12. Our Company’s Service Tax Number for its preforms division is AAACI3404KST002<br />
13. Our Company’s Importer-Exporter Code granted by Ministry of Commerce, Government of India is<br />
0388022515<br />
14. Certificate of Registration under Central Excise, for the polymers, fibres and preforms divisions of our<br />
Company, bearing nos. AAACI2404KXM003, AAACI3404KXM002 and AAACI3404KXM004<br />
respectively, dated January 01, 2003, issued by Deputy Commissioner of Central Excise, under Rule 9<br />
of Central Excise Rules, 2002.<br />
200
Shops and Establishment Act<br />
1. Certificate of Registration of Establishment bearing no. GS010812 dated January 17, 2004 issued under<br />
the Bombay Shops and Establishment Act, 1948 for our Company's premises situated at B-31-33,<br />
Paragaon Condominium, 3 rd Floor, P. Worli, Mumbai-400013. The same is valid till December 31,<br />
2010.<br />
Value Added Tax Registrations for the godowns of our Company<br />
1. Certificate of Registration bearing no. 400705/V/0213, dated August 22, 2005, for the registration under<br />
Maharashtra Value Added Tax Act, 2002 of our Company, with the principal place of business situated<br />
at Plot No., Unit D91100M, T.T.C Industrial Area, Navi Mumbai. The Tax Identification Number for<br />
the same is 27790317819V. The same is valid until cancellation.<br />
2. Certificate of Registration bearing no. AAAC13404KXD014, dated December 14, 2005, for registration<br />
under the Central Excise Rule, 2002, of our Company,for operating as an excisable dealer at S.No. 214,<br />
next to IBM Computers, Bhegari Nagar, Phursungi, Pune, Maharashtra. The same is valid till<br />
cancellation.<br />
3. Certificate of Registration bearing no. 19704035055, dated December 30, 2005, for registration under<br />
West Bengal Value Added Tax Rules, 2005, of our Company, with the principal of business situated at<br />
CWC godown No. 9, Part 1, Panchpara Satyen Bose Road, Radhadasi, Howrah. The same is valid until<br />
cancellation.<br />
4. Certificate of Registration bearing no. 19704035249, dated December 30, 2005, for the registration<br />
under the Central Sales Tax Act, 1956, of our Company, with the principal of business situated at CWC<br />
godown No. 9, Part 1, Panchpara Satyen Bose Road, Radhadasi, Howrah. The same is valid until<br />
cancellation.<br />
5. Certificate of Registration bearing no. AAAC13404KXD015, dated January 13, 2006, for registration<br />
under the Central Excise Rules, 2002, of our Company, for operating as an excisable dealer at Godown<br />
No. 9, Satyen Bose Road, Radhadasi, Panchpara, Botanic Garden, Howrah, West Bengal. The same is<br />
valid till cancellation.<br />
6. Certificate of Registration bearing no. 29230376197, dated June 16, 2006, for registration under<br />
Karnataka Value Added Tax Act, 2003, of our Company, with the principal place of business situated at<br />
Shed No. 68, HOSKOT, Industrial Area, Bangalore-562114<br />
7. Certificate of Regsitration bearing no. 27230376197, dated June 16, 2006, for registration under Central<br />
Sales Tax Act, of our Company, with the principal place if business situated at Shed No. 68, HOSKOT<br />
Industrial Area, Banagalore-562114.<br />
8. Certificate of Registration bearing no. AAAC13404KXD016, dated March 31, 2006, for registration<br />
under the Central Excise Rules, 2002, of our Company, for operating as an excisable dealer at Central<br />
Warehousing Corporation, Godown No. H3, A.P.M.C. Yard, Yeshwanthpur, Bangalore, Karnataka. The<br />
same is valid till cancellation<br />
9. Certificate of Registration, dated July 15, 2005, for registration under the Kerala Value Added Tax Act,<br />
2004 of our Company, with the principal place of business situated at Godown 1A, Central Ware<br />
Housing Corporation, Wise Park, Kanjikkode, Palakkad. The Tax Identification Number for the same is<br />
32090628734. The same is valid until cancellation.<br />
10. Certification of Registration, bearing no. 0906C216164, for registration under the Central Sales Tax<br />
Act, 1956, of our Company with the principal place of business situated at Godown 1A, Central Ware<br />
Housing Corporation, Wise Park, Kanjikkode, Palakkad. The Tax Identification Number for the same is<br />
32090628734. The same is valid until cancellation.<br />
11. Certificate of Registration bearing no. AAAC13404KXD008, dated March 31, 2005, for registration<br />
under the Central Excise Rules, 2002, of our Company, for operating as an excisable dealer at Central<br />
Warehousing Corporation, Godown No. 1A, Wise Park Area, Pudussey Central, Kanjikoda, Palghat,<br />
Kerala. The same is valid till cancellation.<br />
12. Certificate of Registration, bearing no. 130406VAT10502054129, dated September 19, 2006, for<br />
registration under the Andhra Pradesh Value Added Tax Act, 2005, of our Company, with the principal<br />
201
place of business situated at Survey No. 58, G.N.T Road, Tada, Nellore, Andhra Pradesh. The Tax<br />
Identification Number for the same is 28400241905. The same is valid until cancellation.<br />
13. Certificate of Registration, bearing no. 28400241905, dated October 09, 2006, for registration under the<br />
Central Sales Tax (Registration and Turnover) Rules, 1957of our Company, with the principal of<br />
business situated at 4-132, Shop No. 2, 3, 4, G.N.T. Road, Sullurpeta Nellore, Andhra Pradesh. The<br />
same is valid until cancellation.<br />
14. Certificate of Registration bearing no. AAAC13404KXD013, dated November 02, 2005, for registration<br />
under the Central Excise Rules, 2002, of our Company, for operating as an excisable dealer at S.NO.<br />
58/1, National Highway No. 5, Tada, Sullurpet, Nellore, Andhra Pradesh. The same is valid till<br />
cancellation.<br />
15. Certificate of Registration bearing no. MH 01 C 033938, dated April 01, 2006 for registration under the<br />
Central Sales Tax Rules, 1957, of our Company, as a registered dealer for the principal place of business<br />
situated at Paragon Condominium, 3 rd Floor, Pandurang Budhakar Marg, Mumbai. The same is valid<br />
until cancellation.<br />
16. Certificate of Registration bearing no. 312177, dated May 23, 2006 for registration under the Central<br />
Sales Tax Rules, 1957, of our Company, as s registered dealer for the principal place of business<br />
situated at 511, Gagandeep, 12, Rajendra Place, New Delhi. The same is valid till cancellation.<br />
17. Certificate of Registration bearing no. 07400309779, dated May 23, 2006, for the registration under<br />
Delhi Value Added Tax Act, 2005, of our Company, with the principal place of business situated at 511,<br />
Gagandeep, 12, Rajendra Place, New Delhi.<br />
Environment related approvals<br />
1. Authorization by Tamil Nadu Pollution Control Board, bearing Registration no. T9/TNPCB/HWM/F-<br />
23313/TLR/07, dated September 10, 2007, granted to our Company for operating facility for collection,<br />
storage and disposal of hazardous waste under Rule 3 (c) and 5 (5) of Hazardous Wastes (Management<br />
& Handling) Rules, 1989. Authorization is valid for five years, i.e. up to September 09, 2012.<br />
Licenses under Tamil Nadu Factory Rules/Factories Act<br />
1. Certificate of Stability bearing Approval no. H1/45512/2005, dated January 17, 2006, issued by the<br />
Engineer, approved by the Chief Inspector of Factories, Government of Tamil Nadu under Indian<br />
Factories Act and Tamil Nadu Factories Rules,. The same is valid up to August 19, 2009.<br />
2. License to run a factory in the name of Futura Polyesters Limited, bearing Registration no. TVR 1044,<br />
dated December 31, 2004, issued by Deputy Chief Inspector of Factories, Chennai, under Factories Act,<br />
1948. The same is valid up to December 31, 2008<br />
Boiler Licenses<br />
1. Certificate of permission for Boiler no. T/4203 bearing Registration no. 2/Chc/2007-2008, dated April<br />
19, 2007, issued by Deputy Director of Boilers, Government of Tamil Nadu, under Section 7/8 of the<br />
Indian Boilers Act, 1923. The same is valid up to April 15, 2009.<br />
2. Certificate of permission for Boiler no. T/4913 bearing Registration no. 105/Chc/2007-2008, dated<br />
March 19, 2008, issued by Deputy Director of Boilers, Government of Tamil Nadu, under Section 7/8<br />
of the Indian Boilers Act, 1923. The same is valid up to March 18, 2009<br />
3. Certificate of permission for Boiler no. T/4203 bearing Registration no. 02/Chc/89, dated April 16,<br />
2008, issued by Deputy Director of Boilers, Government of Tamil Nadu, under Section 7/8 of the<br />
Indian Boilers Act, 1923. The same is valid up to April 15, 2009.<br />
Explosive Licenses<br />
202
1. Letter of renewal of license for importation of 480 KL of petroleum in installation, bearing Registration<br />
no. P/HQ/TN/15/148(P12837), dated November 23, 2007, by Joint Chief Controller of Explosives,<br />
under the provisions of the Petroleum Act, 1934. The same is valid up to December 31, 2010.<br />
2. Letter of renewal of license for importation of 500 KL of petroleum in installation, bearing Registration<br />
no. P/HQ/TN/15/1984(15671), dated November 23, 2007, by Joint Chief Controller of Explosives,<br />
under the provisions of the Petroleum Act, 1934. The same is valid up to December 31, 2010.<br />
3. Letter of renewal of license for importation of 845 KL of petroleum in installation, bearing Registration<br />
no. P/HQ/TN/15/113(P12805), dated June 05, 2006, by Joint Chief Controller of Explosives, under the<br />
provisions of the Petroleum Act, 1934. The same is valid up to December 31, 2008.<br />
4. Letter of renewal of license for importation of 24 KL of petroleum in installation, bearing Registration<br />
no. P/HQ/TN/15/1219(P14924), dated June 05, 2006, by Joint Chief Controller of Explosives, under the<br />
provisions of the Petroleum Act, 1934. The same is valid up to December 31, 2008.<br />
5. Letter of renewal of license for importation of 270 KL of petroleum in installation, bearing Registration<br />
no. P/HQ/TN/15/2160(P94879), dated November 23, 2007, by Joint Chief Controller of Explosives,<br />
under the provisions of the Petroleum Act, 1934. The same is valid up to December 31, 2008.<br />
6. Letter of renewal of license for importation of 290 KL of petroleum in installation, bearing Registration<br />
no. P/HQ/TN/15/1754(P15430), dated June 05, 2006, by Joint Chief Controller of Explosives, under the<br />
provisions of the Petroleum Act, 1934. The same is valid up to December 31, 2008.<br />
7. Letter of renewal of license for importation of 24 KL of petroleum in installation, bearing Registration<br />
no. P/HQ/TN/15/1795(P15477), dated November 23, 2007, by Joint Chief Controller of Explosives,<br />
under the provisions of the Petroleum Act, 1934. The same is valid up to December 31, 2010.<br />
8. Letter of renewal of license for importation of 410 KL of petroleum in installation, bearing Registration<br />
no. P/HQ/TN/15/306(P13399), dated November 23, 2007, by Joint Chief Controller of Explosives,<br />
under the provisions of the Petroleum Act, 1934. The same is valid up to December 31, 2010.<br />
Licenses under the Electricity Rules<br />
1. Letter of permission bearing no. 37320/EI (T)/T3/76 dated December 27, 1976, issued by Chief<br />
Electrical Inspector, Government of Tamil Nadu, for the installation and commission of 1100 KVA<br />
Diesel Generator set.<br />
2. Certificate of safety bearing Registration no. MES (N) 1040/D4/97, dated January 08, 1997 issued by<br />
Chief Electrical Inspector, Government of Chennai, under Rule 63 of the Indian Electricity Rules, 1956,<br />
203
for installation of three 11 KV, 1750 KVA Diesel Generator sets and one 4.75 MW Gas Turbine<br />
Generator.<br />
3. Certificate of safety bearing Registration no. 373320/EI/Fac/JEI/74, dated October 22, 1974 issued by<br />
Chief Electrical Inspector, Government of Tamil Nadu under Rule 63 of the Indian Electricity Rules,<br />
1956, for the installation of one 1100 KVA Diesel Generator set.<br />
4. Letter of permission bearing no. MES (N)/1040/D2/83-2, dated April 04, 1983 issued by Chief<br />
Electrical Inspector, Government of Tamil Nadu, for the installation and commission of one1100 KVA,<br />
Diesel Generator set.<br />
5. Letter of permission bearing number MES (N)/1040/D2/87, dated February 25, 1987 for the<br />
installation and commission of eleven transformers, by Chief Electrical Inspector, under Rule 63 of the<br />
Indian Electricity Rules, 1956.<br />
6. Letter of permission bearing number MES (N) 1040/D2/86 dated September 28, 1986 for the<br />
installation and commission of one 1000 KVA, transformer, by Chief Electrical Inspector, under Rule<br />
63 of the Indian Electricity Rules, 1956.<br />
7. Letter of permission bearing number MES (N) 1040/D2/87, dated March 06, 1987, for the installation<br />
and commission of four transformers, by Chief Electrical Inspector under Rule 63 of the Indian<br />
Electricity Rules, 1956.<br />
8. Letter of permission bearing Registration no. CN 6760/71/D 3923 dated November 30, 1971, by Tamil<br />
Nadu Electricity Board for the supply of electricity, to the polyester fibre plant situated at Manali.<br />
9. Certificate of Safety bearing Registration no. 37320/EIT/Y4/73, dated July 17, 1973, for operating the<br />
lift in the factory, situated at Manali, Chennai, by the Chief Electoral Inspector, Government of Tamil<br />
Nadu.<br />
Agreements for the Supply of Energy<br />
1. Agreement entered into between Tamil Nadu Electricity Licensee, through Superintending Engineer and<br />
our Company, dated March 31, 2005 for the supply of 12500 KVA of electrical energy.<br />
License from Fire Department<br />
204
1. License bearing no. 809/05, dated October 26, 2005, issued by Divisional Officer, Tamil Nadu Fire<br />
Department, under Section 13 of the Tamil Nadu Fire & Rescue Services Act, 1985 for selling, storing,<br />
processing, pressing, transporting of works, petroleum items and petroleum product storage..<br />
Licenses related to the Export Oriented Unit<br />
1. Letter of permission bearing Registration no. F.No. 19/105/93-EOU/TN from Ministry of Commerce,<br />
Government of India to change the name from Futura Polymers Limited to Futura Polyesters Limited<br />
2. Letter of permission bearing Registration no. 19/105/93-EOU-TN-Vol-VI dated January 02, 2002, from<br />
Ministry of Commerce, Government of India, for the establishment of Export-Oriented Unit by way of<br />
merger of three existing Export Oriented Units with their locations in the State of Tamil Nadu.<br />
3. Green Card No. 1241/MEPZ, dated April 01, 2004, issued by Ministry of Commerce for the approval to<br />
receive priority treatment from all the State Governments, as an Export Oriented Unit for the<br />
manufacturing of PET Chips, Polyester Polymer Flakes, Polyester Filament Yarn, Poly Trimethylene<br />
Terephthalate (PTT). The same is valid up to March 31, 2009.<br />
4. Registration-Cum-Membership Certificate, bearing no. RCMC No. 0465/2006-2007, issued by<br />
Federation of Indian Export Organization, dated April 04, 2006. Our Company was registered as a large<br />
scale manufacturer, with the Registration no. FIEO/WR/0465/2006-2007/0465. The same is valid up to<br />
March 31, 2009<br />
5. Certificate of Recognition bearing no. 015947, issued by the Office the Joint Director, General of<br />
Foreign Trade, dated January 13, 2003, awarded to our Company, awarding it the status of one star<br />
Export House, in accordance with the provisions of the Exim Policy. The same is valid up to March 31,<br />
2009.<br />
6. Acknowledgement bearing no. 1401/SIA/IMO/2003, by Secretariat of Industrial Assistance, dated May<br />
28, 2003, for acknowledging the manufacture of Pet Preforms, Pet Chips, Polyester Master Batch Chips,<br />
Polyester Staple Fibre, Polyester Tops and Polyester TOW by our Company.<br />
Other Licenses<br />
1. Certificate of Registration bearing Code no. 511597418 under Employees State Insurance Act, issued in<br />
the name of our Company for our employees at Manali, Chennai..<br />
2. Certificate of Registration bearing EST Code no. TN/9614 under Employee’ Provident Fund and<br />
Miscellaneous Provisions Act, 1932 issued in the name of our Company.<br />
205
3. Certificate of Registration bearing Code no. 31-18004-102 under Employees State Insurance Act, dated<br />
May 14, 1981, issued in the name of our Company for our employees employed with the office situated<br />
at Paragon Condominium, 3 rd Floor, Pandurang Budhakar Marg, Mumbai.<br />
4. Certificate of Verification bearing Registration no. TN. 341, dated March 03, 2007, issued by Deputy<br />
Inspector of Labor, Government of Tamil Nadu, under the Standards of Weights and Measures<br />
(Enforcement) Act, 1985. The same is valid up to January 22, 2009.<br />
5. Certificate of Registration bearing Registration no. R.C.no. 12/2004, dated February 07, 2007, issued by<br />
Chief Inspector of Factories, Government of Tamil Nadu, under the Contract Labor (Regulation and<br />
Abolition) Act, 1970 and Tamil Nadu Contract Labor Rules, 1975.<br />
6. Permission bearing no. GS/55/F of 2004-2005, under Bombay Municipal Corporation Act, dated March<br />
22, 2005, to establish computer data processing unit at the office situated at Paragaon Condominium, 3 rd<br />
Floor, Pandurang Budhakar Marg, Mumbai. The same is valid up to March 31, 2009<br />
ISO Certification<br />
1. ISO 9001:2000 Certification, bearing no. 217938, dated September 10, 2007, awarded by Bureau<br />
Veritas Certification (India) Private Limited for satisfactory operation of the Company’s Management<br />
System. The same is valid up to June 22, 2010.<br />
2. ISO 14001:2004 Certification, bearing no. 185630, dated February 23, 2006, awarded by BVQI for<br />
satisfactory operation of the Company’s Environmental Management System. The same is valid up to<br />
September 27, 2008.<br />
Safety Inspection Reports<br />
1. Report of Examination dated June 18, 2008 of 4 Electric Hoist under Section 29 of Factories Act, 1948<br />
and Rule 55A of Tamil Nadu Factory Rules, 1950. The same is valid up to June 17, 2009.<br />
2. Report of Examination dated June 19, 2008 of 5 Fork Lifts under Section 29 of Factories Act, 1948 and<br />
Rule 55A of Tamil Nadu Factory Rules, 1950. The same is valid up to June 18, 2009.<br />
3. Report of Examination dated June 23, 2008 of 4 Fork Lifts and 4 Electric Hoist under Section 29 of<br />
Factories Act, 1948 and Rule 55A of Tamil Nadu Factory Rules, 1950. The same is valid up to June 22,<br />
2009.<br />
206
4. Report of Examination dated June 24, 2008 of 2 Fork Lifts, 1 Four Wheeled Troley and 1 Wire Rope<br />
Sling under Section 29 of Factories Act, 1948 and Rule 55A of Tamil Nadu Factory Rules, 1950. The<br />
same is valid up to June 23, 2009.<br />
Reports of Examination of Pressure Vessels<br />
1. Reports of examination bearing no. TVR 1044/PV; 01/ET/2007-II, dated October 05, 2007 of 79<br />
pressure vessels under Rule 56 of Tamil Nadu Factories Rules, by Deputy Chief Inspector of Factories,<br />
certifying that the relevant pressure vessel is in a satisfactory working condition.<br />
2. Reports of examination bearing no. TVR 1044/PV; 02/ET/2007-II, dated March 26, 2007 of 2 pressure<br />
vessels under Rule 56 of Tamil Nadu Factories Rules, by Deputy Chief Inspector of Factories, certifying<br />
that the relevant pressure vessel is in a satisfactory working condition.<br />
3. Reports of examination bearing no. TVR 1044/PV; 03/ET/2007-II, dated October 08, 2007 of 58<br />
pressure vessels under Rule 56 of Tamil Nadu Factories Rules, by Deputy Chief Inspector of Factories,<br />
certifying that the relevant pressure vessel is in a satisfactory working condition.<br />
2. Reports of examination bearing no. TVR 1044/PV; 04/ET/2007-II, dated September 24, 2007 of 57<br />
pressure vessels under Rule 56 of Tamil Nadu Factories Rules, by Deputy Chief Inspector of Factories,<br />
certifying that the relevant pressure vessel is in a satisfactory working condition.<br />
Approvals applied for but not received<br />
Sr.<br />
No<br />
License expired, applied for renewal Details of application. Authority<br />
before<br />
which<br />
pending.<br />
1. Renewal of consent by Tamil Nadu<br />
Pollution Control Board, bearing<br />
Registration<br />
no.<br />
T9/TNPCBD/F2787/W/RL/04 for the<br />
polymer and preform division for the<br />
discharge of sewage and/or trade effluent<br />
under Section 25/26 of the Water<br />
(Prevention and Control of Pollution) Act,<br />
1974 valid upto March 31, 2008<br />
2. Renewal of consent by Tamil Nadu<br />
Pollution Control Board bearing<br />
Registration<br />
no.<br />
T9/TNPCBD/F2787/TVLR/RL/A/04 for<br />
the polymer and preform division for the<br />
exsisting plant operation under Section 21<br />
of the Air (prevention and Control of<br />
pollution) Act, 1981 valid upto March 31,<br />
2008<br />
3. Renewal of consent by Tamil Nadu<br />
Pollution Control Board, bearing<br />
Registration<br />
no.<br />
Our Company has made an<br />
application for the renewal of<br />
the consent vide letter dated<br />
February 20, 2008, bearing<br />
number<br />
HR/MISC/TNPCB/694/2008.<br />
Our Company has made an<br />
application for the renewal of<br />
the consent vide letter dated<br />
February 20, 2008, bearing<br />
number<br />
HR/MISC/TNPCB/694/2008.<br />
Our Company has made an<br />
application for the renewal of<br />
the consent vide letter dated<br />
Tamil Nadu<br />
Pollution<br />
Control<br />
Board.<br />
Tamil Nadu<br />
Pollution<br />
Control<br />
Board.<br />
Tamil Nadu<br />
Pollution<br />
Control<br />
207
T9/TNPCBD/F2788/W/RL/04 for the<br />
fibre division for the discharge of sewage<br />
and/or trade effluent under section 25/26<br />
of the Water (prevention and Control of<br />
pollution) Act, 1974 valid upto March 31,<br />
2008<br />
4. Renewal of consent by Tamil Nadu<br />
Pollution Control Board bearing<br />
Registration<br />
no.<br />
T9/TNPCBD/TVLR/F2788/A/RL/04 for<br />
the fibre division for the exsisting plant<br />
operation under Section 21 of the Air<br />
(Prevention and Control of Pollution) Act,<br />
1981 valid upto March 31, 2008<br />
5. Renewal of consent by Tamil Nadu<br />
Pollution Control Board, bearing<br />
Registration no. DEE/TNPCB/TLR/OL-<br />
50/W/07 for the ARM(Alternate Raw<br />
Material) division issued by the District<br />
Enviornmental Engineer for the discharge<br />
of sewage and/or trade effluent under<br />
Section 25 of the Water (Prevention and<br />
Control of Pollution) Act, 1974 valid upto<br />
March 31, 2008<br />
6. Renewal of consent by Tamil Nadu<br />
Pollution Control Board, bearing<br />
Registration no. DEE/TNPCB/TLR/OL-<br />
50/A/07 for the ARM(Alternate Raw<br />
Material) division issued by the District<br />
Enviornmental Engineer for the exsisting<br />
operation of the plant under Section 21 of<br />
the Air (Prevention and Control of<br />
Pollution) Act, 1981 valid upto March 31,<br />
2008<br />
7. Renewal of license issued by Tamil Nadu<br />
Fire Department under Section 13 of<br />
Tamil Nadu Fire & Rescue Services Act,<br />
1985 for selling, storing, processing,<br />
pressing, transporting of works, petroleum<br />
items and petroleum product storage.<br />
8. Renewal of license issued by Tamil Nadu<br />
Fire & Rescue Services, under Section 13<br />
of Tamil Nadu Fire & Rescue Services<br />
Act.<br />
9. Renewal of provisional order of<br />
permission for Boiler no. T/8085 issued<br />
by Deputy Director of Boilers,<br />
Government of Tamil Nadu, under Section<br />
9 of the Indian Boilers Act, 1923 which<br />
was valid upto July 4, 2008.<br />
February 20, 2008, bearing<br />
number<br />
HR/MISC/TNPCB/693/2008.<br />
Our Company has made an<br />
application for the renewal of<br />
the consent vide letter dated<br />
February 20, 2008, bearing<br />
number<br />
HR/MISC/TNPCB/693/2008.<br />
Our Company has made an<br />
application for the renewal of<br />
the consent vide letter dated<br />
February 20, 2008, bearing<br />
number<br />
HR/MISC/TNPCB/695/2008.<br />
Our Company has made an<br />
application for the renewal of<br />
the consent vide letter dated<br />
February 20, 2008, bearing<br />
number<br />
HR/MISC/TNPCB/695/2008.<br />
Our Company has made an<br />
application for the renewal of<br />
the license vide letter dated<br />
January 04, 2007 bearing no.<br />
HR/MISC/FIRE<br />
LICENSE/578/2007.<br />
Our Company has made an<br />
application for the renewal of<br />
the license vide letter dated<br />
May 02, 2008, bearing no.<br />
HR/MISC/FIRE<br />
LICENSE/817/2008<br />
Our Company has made an<br />
application for carrying out<br />
inspection vide letter dated<br />
June 27, 2008.<br />
Board<br />
Tamil Nadu<br />
Pollution<br />
Control<br />
Board.<br />
Tamil Nadu<br />
Pollution<br />
Control<br />
Board.<br />
Tamil Nadu<br />
Pollution<br />
Control<br />
Board.<br />
Tamil Nadu<br />
Fire<br />
Department.<br />
Tamil Nadu<br />
Fire<br />
Department.<br />
Deputy<br />
Director of<br />
Boilers<br />
Note<br />
License bearing no. D.L.2.No. 35/2007-2008, dated October 30, 2007, issued by Commissioner of Prohibition<br />
and Excise, Chennai, under Section 18 of the Tamil Nadu Prohibition Act, 1937 for the possession and use of<br />
Methyl Alcohol was valid upto March 31, 2008. Renewal of this license has not been applied for since the<br />
208
enewal of the same can be applied for after our Company has received the license issued by Tamil Nadu Fire &<br />
Rescue Services Act for which application has been made but license has not been received as stated under the<br />
head, “Approvals applied for but not received”.<br />
Licenses in relation to objects of the Issue<br />
a. The objects of this Issue (other than meeting the issue expenses) are funding the working capital<br />
requirements & general corporate purposes as on chapter titled “Objects of the Issue” page 20 of the Draft<br />
Letter of Offer.<br />
b. We do not currently envisage any specific government approvals required by us for the aforesaid objects.<br />
We have thus not applied for government approvals, if any, which may be required in relation to the objects<br />
of the Issue.<br />
209
SECTION VII – OTHER REGULATORY AND STATUTORY DISCLOSURES<br />
Authority of the Issue<br />
Our Board has, pursuant to a resolution passed at its meeting held on May 30, 2008 has decided to make this<br />
Issue to the Equity Shareholders of our Company with right to renounce.<br />
Prohibition by SEBI<br />
Our Company, our Directors, our associate and group companies, our Promoter Group Entities, our Promoters,<br />
our Directors, firms and companies with which our Company’s Directors are associated as directors or<br />
promoters have not been prohibited from accessing or operating in the capital markets or restrained from<br />
buying, selling or dealing in securities under any order or direction passed by SEBI.<br />
Further, our Promoters and Promoter Group entities and associate companies are not detained as willful<br />
defaulters by RBI/ Government authorities and there are no violations of securities law committed by them in<br />
the past or pending against them.<br />
Eligibility for the Issue<br />
Our company is an existing listed company registered under the Act, whose Equity Shares are listed on BSE. It<br />
is eligible to offer this Issue in terms of clause 2.4.1(iv) of the SEBI DIP guidelines.<br />
Disclaimer Clause<br />
AS REQUIRED, A COPY OF THE DRAFT LETTER OF OFFER HAS BEEN SUBMITTED TO SEBI.<br />
IT IS TO BE DISTINCTLY UNDERSTOOD THAT SUBMISSION OF THE DRAFT LETTER OF<br />
OFFER TO SEBI SHOULD NOT, IN ANY WAY, BE DEEMED OR CONSTRUED TO MEAN THAT<br />
THE SAME HAS BEEN CLEARED OR APPROVED BY SEBI. SEBI DOES NOT TAKE ANY<br />
RESPONSIBILITY EITHER FOR THE FINANCIAL SOUNDNESS OF ANY SCHEME OR FOR THE<br />
CORRECTNESS OF THE STATEMENTS MADE OR OPINIONS EXPRESSED IN THE DRAFT<br />
LETTER OF OFFER. THE LEAD MANAGER <strong>IDBI</strong> CAPITAL MARKET SERVICES <strong>LIMITED</strong><br />
HAVE CERTIFIED THAT THE DISCLOSURES MADE IN THE DRAFT LETTER OF OFFER ARE<br />
GENERALLY ADEQUATE AND ARE IN CONFORMITY WITH SEBI (DISCLOSURE AND<br />
INVESTOR PROTECTION) GUIDELINES AS FOR THE TIME BEING IN FORCE. THIS<br />
REQUIREMENT IS TO FACILITATE INVESTORS TO TAKE AN INFORMED DECISION FOR<br />
MAKING AN INVESTMENT IN THE PROPOSED ISSUE. IT SHOULD ALSO BE CLEARLY<br />
UNDERSTOOD THAT WHILE THE COMPANY IS PRIMARILY RESPONSIBLE FOR THE<br />
CORRECTNESS, ADEQUACY AND DISCLOSURE OF ALL RELEVANT INFORMATION IN THE<br />
DRAFT LETTER OF OFFER, THE LEAD MANAGER IS EXPECTED TO EXERCISE DUE<br />
DILIGENCE TO ENSURE THAT THE ISSUER COMPANY DISCHARGES ITS RESPONSIBILITY<br />
ADEQUATELY IN THIS BEHALF AND TOWARDS THIS PURPOSE THE LEAD MANAGER, HAS<br />
FURNISHED TO SEBI, A DUE DILIGENCE CERTIFICATE DATED JULY 17, 2007 IN<br />
ACCORDANCE WITH THE SEBI (MERCHANT BANKERS) REGULATIONS, 1992, WHICH READS<br />
AS FOLLOWS:<br />
i. WE HAVE EXAMINED VARIOUS DOCUMENTS INCLUDING THOSE RELATING TO<br />
LITIGATION LIKE COMMERCIAL DISPUTES, PATENT DISPUTES, DISPUTES WITH<br />
COLLABORATORS, ETC. AND OTHER MATERIALS MORE PARTICULARLY<br />
REFERRED TO IN THE ANNEXURE HERETO IN CONNECTION WITH THE<br />
FINALISATION OF THE DRAFT LETTER OF OFFER PERTAINING TO THE SAID ISSUE,<br />
ii. ON THE BASIS OF SUCH EXAMINATION AND THE DISCUSSIONS WITH THE<br />
COMPANY, IT’S DIRECTORS AND OTHER OFFICERS, OTHER AGENCIES,<br />
INDEPENDENT VERIFICATION OF THE STATEMENTS CONCERNING THE OBJECTS<br />
OF THE ISSUE, PROJECTED PROFITABILITY, PRICE JUSTIFICATION AND THE<br />
CONTENTS OF THE DOCUMENTS MENTIONED IN THE ANNEXURE AND OTHER<br />
PAPERS FURNISHED BY THE COMPANY,<br />
WE CONFIRM THAT:<br />
A. THE DRAFT LETTER OF OFFER FORWARDED TO THE BOARD IS IN CONFORMITY<br />
WITH THE DOCUMENTS, MATERIALS AND PAPERS RELEVANT TO THE ISSUE;<br />
210
B. ALL THE LEGAL REQUIREMENTS CONNECTED WITH THE SAID ISSUE AS ALSO THE<br />
GUIDELINES, INSTRUCTIONS, ETC. ISSUED BY THE BOARD, THE GOVERNMENT<br />
AND ANY OTHER COMPETENT AUTHORITY IN THIS BEHALF HAVE BEEN DULY<br />
COMPLIED WITH; AND<br />
C. THE DISCLOSURES MADE IN THE DRAFT LETTER OF OFFER ARE TRUE, FAIR AND<br />
ADEQUATE TO ENABLE THE INVESTORS TO MAKE A WELL-INFORMED DECISION<br />
AS TO THE INVESTMENT IN THE PROPOSED ISSUE AND SUCH DISCLOSURES ARE IN<br />
ACCORDANCE WITH THE REQUIREMENTS OF THE COMPANIES ACT 1956, THE SEBI<br />
(DISCLOSURE AND INVESTOR PROTECTION) GUIDELINES, 2000 AND OTHER<br />
APPLICABLE LEGAL REQUIREMENTS.<br />
iii. WE CONFIRM THAT BESIDES OURSELVES, ALL THE INTERMEDIARIES NAMED IN<br />
THE DRAFT LETTER OF OFFER ARE REGISTERED WITH SEBI AND THAT TILL DATE<br />
SUCH REGISTRATIONS ARE VALID;<br />
iv. WE HAVE SATISFIED OUR SELVES ABOUT THE WORTH OF THE UNDERWRITERS TO<br />
FULFILL THEIR UNDERWRITING COMMITMENTS – NOT APPLICABLE;<br />
v. WE CERTIFY THAT THE WRITTEN CONSENT FROM SHAREHOLDERS HAS BEEN<br />
OBTAINED FOR INCLUSION OF THEIR SECURITIES AS PART OF PROMOTERS<br />
CONTRIBUTION SUBJECT TO LOCK-IN AND THE SECURITIES PROPOSED TO FOR<br />
PART OF PROMOTERS CONTRIBUTION SUBJECT LOCK-IN, WILL NOT BE DISPOSED<br />
/ SOLLED / TRASFERED BY THE PROMOTERS DURING THE PERIOD STARTING<br />
FROM THE DATE OF FILING OF THE DRAFT LETTER OF OFFER WITH BOARD TILL<br />
THE DATE OF COMMENCEMENT OF LOCK-IN PERIOD AS STATED IN THE DRAFT<br />
LETTER OF OFFER – NOT APPLICABLE;<br />
vi. WE CERTIFY THAT CLAUSE 4.6 OF THE SEBI (DISCLOSURE AND INVESTOR<br />
PROTECTION) GUIDELINES, 2000, WHICH RELATES TO SECURITIES INELIGIBLE<br />
FOR COMPUTATION OF PROMOTERS CONTRIBUTION, HAS BEEN DULY COMPLIED<br />
WITH AND APPROPRIATE DISCLOSURES AS TO COMPLIANCE WITH THE CLAUSE<br />
HAVE BEEN MADE IN THE DRAFT PROSPECTUS/LETTER OF OFFER – NOT<br />
APPLICABLE.<br />
vii. WE UNDERTAKE THAT CLAUSES 4.9.1, 4.9.2, 4.9.3 AND 4.9.4 OF THE SEBI<br />
(DISCLOSURE AND INVESTOR PROTECTION) GUIDELINES, 2000 SHALL BE<br />
COMPLIED WITH. WE CONFIRM THAT ARRANGEMENTS HAVE BEEN MADE TO<br />
ENSURE THAT PROMOTERS’ CONTRIBUTION AND SUBSCRIPTION FROM ALL FIRM<br />
ALLOTTEES WOULD BE RECEIVED AT LEAST ONE DAY BEFORE THE OPENING OF<br />
THE ISSUE .WE UNDERTAKE THAT AUDITORS’ CERTIFICATE TO THIS EFFECT<br />
SHALL BE DULY SUBMITTED TO THE BOARD. WE FURTHER CONFIRM THAT<br />
ARRANGEMENTS HAVE BEEN MADE TO ENSURE THAT PROMOTERS’<br />
CONTRIBUTION SHALL BE KEPT IN AN ESCROW ACCOUNT WITH A SCHEDULED<br />
COMMERCIAL BANK AND SHALL BE RELEASED TO THE COMPANY ALONG WITH<br />
THE PROCEEDS OF THE PUBLIC ISSUE – NOT APPLICABLE.<br />
viii. WHERE THE REQUIREMENTS OF PROMOTERS’ CONTRIBUTION IS NOT<br />
APPLICABLE TO THE ISSUER, WE CERTIFY THE REQUIREMENTS OF PROMOTERS’<br />
CONTRIBUTION UNDER CLAUSE 4.10 {SUB-CLAUSE (A), (B) OR (C), AS MAY BE<br />
APPLICABLE} ARE NOT APPLICABLE TO THE ISSUER – NOT APPLICABLE.<br />
ix. WE CERTIFY THAT THE PROPOSED ACTIVITIES OF THE ISSUER FOR WHICH THE<br />
FUNDS ARE BEING RAISED IN THE PRESENT ISSUE FALL WITHIN THE ‘MAIN<br />
OBJECTS’ LISTED IN THE OBJECT CLAUSE OF THE MEMORANDUM OF<br />
ASSOCIATION OR OTHER CHARTER OF THE ISSUER AND THAT THE ACTIVITIES<br />
WHICH HAVE BEEN CARRIED OUT UNTIL NOW ARE VALID IN TERMS OF THE<br />
OBJECT CLAUSE OF ITS MEMORANDUM OF ASSOCIATION.<br />
x. WE CONFIRM THAT NECESSARY ARRANGEMENTS HAVE BEEN MADE TO ENSURE<br />
THAT THE MONEYS RECEIVED PURSUANT TO THE ISSUE ARE KEPT IN A SEPARATE<br />
BANK ACCOUNT AS PER THE PROVISIONS OF SECTION 73(3) OF THE COMPANIES<br />
211
ACT, 1956 AND THAT SUCH MONEYS SHALL BE RELEASED BY THE SAID BANK<br />
ONLY AFTER PERMISSION IS OBTAINED FROM ALL THE STOCK EXCHANGES<br />
MENTIONED IN THE LETTER OF OFFER. WE FURTHER CONFIRM THAT THE<br />
AGREEMENT ENTERED INTO BETWEEN THE BANKERS TO THE ISSUE AND THE<br />
ISSUER SPECIFICALLY CONTAINS THIS CONDITION.<br />
xi. WE CERTIFY THAT NO PAYMENT IN THE NATURE OF DISCOUNT, COMMISSION,<br />
ALLOWANCE OR OTHERWISE SHALL BE MADE BY THE ISSUER OR THE<br />
PROMOTERS, DIRECTLY OR INDIRECTLY, TO ANY PERSON WHO RECEIVES<br />
SECURITIES BY WAY OF FIRM ALLOTMENT IN THE ISSUE.<br />
xii. WE CERTIFY THAT A DISCLOSURE HAS BEEN MADE IN THE DRAFT LETTER OF<br />
OFFER THAT THE INVESTORS SHALL BE GIVEN AN OPTION TO GET THE SHARES IN<br />
DEMAT OR PHYSICAL MODE.<br />
xiii. WE CERTIFY THAT THE FOLLOWING DISCLOSURES HAVE BEEN MADE IN THE<br />
DRAFT LETTER OF OFFER:<br />
a) AN UNDERTAKING FROM THE ISSUER THAT AT ANY GIVEN TIME THERE<br />
SHALL BE ONLY ONE DENOMINATION FOR THE SHARES OF THE COMPANY<br />
AND;<br />
b) AN UNDERTAKING FROM THE ISSUER THAT IT SHALL COMPLY WITH SUCH<br />
DISCLOSURE AND ACCOUNTING NORMS SPECIFIED BY THE BOARD FROM<br />
TIME TO TIME.<br />
The filing of the Draft Letter of Offer does not, however, absolve our Company from any liabilities under<br />
Section 63 or Section 68 of the Act or from the requirement of obtaining suchstatutory and other clearances as<br />
may be required for the purpose of the proposed Issue. SEBI further reserves the right to takeup, at any point of<br />
time, with the Lead Manager any irregularities or lapses in the Draft Letter of Offer. In addition to the Lead<br />
Manager, the Issuer is also obligated to update the Draft Letter of offer and keep the public informed of any<br />
material changes till the date of listing and commencement of trading of the Equity Shares offered under the<br />
Draft Letter of Offer.<br />
Caution<br />
Our Company and Lead Manager accept no responsibility for statements made otherwise than in the Draft Letter<br />
of Offer or in the advertisements or any other material issued by or at the instance of our Company and that<br />
anyone placing reliance on any other source of information, including our website www.futurapolyesters.com,<br />
would be doing so at his/her/their own risk.<br />
All information shall be made available by the Lead Manager and the Issuer to the shareholders and no selective<br />
or additional information would be made available for a section of the shareholders or investors in any manner<br />
whatsoever including at presentations, research or sales reports etc.<br />
Investors that invest in the Issue will be deemed to have represented to our Company and Lead Manager and<br />
their respective directors, officers, agents, affiliates and representatives that they are eligible under all applicable<br />
laws, rules, regulations, guidelines and approvals to acquire Equity Shares of our Company, and are relying on<br />
independent advice / evaluation as to their ability and quantum of investment in this Issue.<br />
Disclaimer in Respect of Jurisdiction<br />
The Draft Letter of Offer has been prepared under the provisions of Indian Law and the applicable rules and<br />
regulations hereunder.<br />
The distribution of the Draft Letter of Offer and the offering of the Equity Shares on a rights basis to persons in<br />
certain jurisdictions outside India may be restricted by the legal requirements prevailing in those jurisdictions.<br />
Persons into whose possession the Draft Letter of Offer may come are required to inform themselves about and<br />
observe such restrictions. Any disputes arising out of this Issue will be subject to the jurisdiction of the<br />
appropriate court(s) in Mumbai, India only.<br />
No action has been or will be taken to permit this Issue in any jurisdiction where action would be required for<br />
that purpose, except that the Draft Letter of Offer has been filed with SEBI for observations and SEBI has given<br />
its observations. Accordingly, the Equity Shares represented thereby may not be offered or sold, directly or<br />
indirectly, and the Draft Letter of Offer may not be distributed in any jurisdiction, except in accordance with the<br />
212
legal requirements applicable in such jurisdiction. In this respect investors are advised to refer to the paragraph<br />
tiltled “No Offer in Other Jurisdictions” on page v of the Draft Letter of Offer. Neither the delivery of the Draft<br />
Letter of Offer nor any sale hereunder, shall under any circumstances create any implication that there has been<br />
no change in our affairs from the date hereof or that the information contained herein is correct as of any time<br />
subsequent to this date.<br />
The Designated Stock Exchange for the purpose of this Issue will be BSE.<br />
Disclaimer clause of the BSE<br />
As required, a copy of the Draft Letter of Offer has been submitted to The Bombay Stock Exchange Limited,<br />
(hereinafter referred to as “BSE” or the “Exchange”). BSE has given vide its letter dated [●] permission to our<br />
Company to use the Exchange’s name in the Draft Letter of Offer as one of the stock exchanges on which this<br />
Company’s Equity Shares are proposed to be listed. The Exchange has scrutinized the Draft Letter of Offer for<br />
its limited internal purpose of deciding on the matter of granting the aforesaid permission to this Company. The<br />
Exchange does not in any manner: (i) Warrant, certify or endorse the correctness or completeness of any of the<br />
contents of the Draft Letter of Offer; or (ii) Warrant that this Company’s securities will be listed or will continue<br />
to be listed on the Exchange; or (iii) take any responsibility for the financial or other soundness of this<br />
Company, its promoters, its management or any scheme or project of this Company; and it should not for any<br />
reason be deemed or construed that the Draft Letter of Offer has been cleared or approved by the Exchange.<br />
Every person who desires to apply for or otherwise acquires any securities of this Company may do so pursuant<br />
to independent inquiry, investigation and analysis and shall not have any claim against the Exchange whatsoever<br />
by reason of any loss which may be suffered by such person consequent to or in connection with such<br />
subscription/acquisition whether by reason of anything stated or omitted to be stated herein or for any other<br />
reason whatsoever.<br />
Filing<br />
The Draft Letter of Offer has been filed with Securities Exchange Board of India, SEBI Bhavan, Plot No C-4A,<br />
G Block, Bandra Kurla Complex, Bandra (East), Mumbai 400 051, for its observations and also with BSE where<br />
the Equity Shares to be issued in terms of the Draft Letter of Offer are proposed to be listed.<br />
Dematerialised Dealing<br />
Our Company has entered into agreement dated March 24, 2005 and March 03, 2005 with NSDL and CDSL<br />
respectively and its Equity Shares bear the ISIN No. INE 564A01017<br />
Listing<br />
The existing Equity Shares of our Company are listed on BSE. Our Company has paid the current annual listing<br />
fees to BSE. Our Company will apply for in-principle approval from BSE for the Equity Shares proposed to be<br />
issued through the Draft Letter of Offer and has received in-principle approval from BSE by its letter dated [●]<br />
granting the same for listing the Equity Shares arising from this Issue.<br />
Consent<br />
Consent in writing of the Auditors, Lead Manager, Legal Advisor to the Issue, Registrar to the Issue to act in<br />
their respective capacities and of the bankers to our Company and Directors for their names to appear as such in<br />
the Draft Letter of Offer have been obtained and filed with SEBI, along with a copy of the Draft Letter of Offer<br />
and such consents have not been withdrawn up to the time of delivery of the Draft Letter of Offer for<br />
registration with the Stock Exchange.<br />
M/s N. M. Raiji & Co., the Auditors of our Company have given their written consent for the inclusion of their<br />
Report in the form and content as appearing the Draft Letter of Offer and such consents and Reports have not<br />
been withdrawn upto the time of delivery of the Draft Letter of Offer for registration to the Stock Exchange. M/s<br />
N. M. Raiji & Co., the Auditors of our Company have given their written consent for inclusion of statement of<br />
tax benefits in the form and content as appearing in the Draft Letter of Offer accruing to our Company and its<br />
members. To the best of our knowledge there are no other consents required for making this issue, however,<br />
should the need arise, necessary consents shall be obtained by us.<br />
Impersonation<br />
Attention of the applicants is specifically drawn to the provisions of sub-section (1) of Section 68A of the Act,<br />
which is reproduced below:<br />
“Any person who<br />
213
a) Makes in a fictitious name, an application to a company for acquiring or subscribing for, any shares<br />
therein, or<br />
b) Otherwise induces a company to allot, or register any transfer of shares therein to him, or any other<br />
person in a fictitious name, shall be punishable with imprisonment for a term which may extend to five<br />
years.”<br />
Expert Opinion<br />
Save and except as stated in the section titled “Financial Statements” and chapter titled “Statement of Tax<br />
Benefits” beginning on pages 111 and 25 respectively of the Draft Letter of Offer, our Company has not<br />
obtained any expert opinions in relation to the Draft Letter of Offer.<br />
Option to Subscribe<br />
Please refer paragraph titled “Option to receive Equity Shares in Dematerialised Form” in the chapter titled<br />
“Terms of the Issue” beginning on page 220 of the Draft Letter of Offer.<br />
Underwriting Commission, Brokerage and Selling Commission.<br />
No underwriting commission, brokerage and selling commission will be paid for the Issue.<br />
DETAILS OF PUBLIC / RIGHTS ISSUES<br />
a) Rights Issue in the year 2004<br />
Our Company had undertaken a Rights Issue of 1,48,78,729 Equity Shares of Rs. 10 each for cash at par<br />
aggregating to Rs. 1487.87 lacs to the existing shareholders of our Company in the proportion of four Equity<br />
Shares for every nine Equity Shares to those members whose name appeared on the register of members as on<br />
September 14, 2004. The issue opened on September 30, 2004 and closed on October 29, 2004.<br />
Promise vs. Performance<br />
For Rights Issue made in 2004 main objects of the Issue were as follows:<br />
To fund the working capital needs<br />
After reworking the capital needs and subsequently taking into account the growth in business turnover, the<br />
product manufactured, cost of manufacture, inflation etc. our Company came to the conclusion that the net<br />
working capital gap shall be funded through the proceeds of the Issue. Therefore, the main object of the Rights<br />
Issue made in 2004, was to utilize the proceeds as working capital.<br />
214
Promise vs. performance<br />
The objective for which the Issue was made was fulfilled<br />
b) Rights Issue in the year 1993<br />
Our Company had undertaken a Rights Issue of 92,22,040 Equity Shares of Rs. 10 each at a premium of Rs. 20/-<br />
per share aggregating to Rs. 27,66,61,200 lacs to the existing shareholders of our Company in the proportion of<br />
two Equity Shares for every five Equity Shares. The issue was made to strengthen the capital base of our<br />
Company and to bring about better balance between our Company’s borrowings and paid up capital and<br />
reserves.<br />
Promise vs. Performance<br />
For Rights Issue made in 1993 main objects of the Issue were as follows:<br />
The issue was made to strengthen the capital base of our Company and to bring about better balance between<br />
our Company’s borrowings and paid up capital and reserves.<br />
As against the above, our Company has achieved the following:<br />
(Rs. In Lacs)<br />
1992-93 1993-94 1994-95<br />
Promised Actual Promised Actual Promised Actual<br />
Equity <strong>Capital</strong> 2320 2305.51 3248 3191.99 3248 3237.63<br />
Reserves 3950 3650.93 6218 7773.64 7573 8816.24<br />
Sales and Other Income 28447 25635 42246 29861.90 50328 36471.85<br />
PBIDT 2754 2351.96 5350 5460.56 6764 4039.23<br />
Interest 1778 1826.34 2382 1750.84 2505 1515.10<br />
Depreciation 1296 1392.52 1906 959.50 2092 1073.84<br />
Tax 0 0 0 5.00 0 5.00<br />
PAT (320) (866.90) 1062 2745.22 2167 1445.29<br />
Dividend 10% Nil 20% 12% 25% 15%<br />
EPS (1.38) (3.78) 3.27 8.60 6.67 4.46<br />
Book Value 27.03 25.83 29.14 34.35 33.32 37.23<br />
c) Rights Issue in the year 1988<br />
Our Company had undertaken a Rights Issue of 59,42,425 Equity Shares of Rs. 10 each at a premium of Rs. 5/-<br />
per share aggregating to Rs. 8,91,36,375 to the existing shareholders of our Company in the proportion of two<br />
Equity Shares for every one Equity Share.<br />
Promise vs. Performance<br />
For Rights Issue made in 1988 main objects of the Issue were as follows:<br />
The object of the issue was to augement the long term resources of our Company for the then going operations<br />
and to strengthen the equity base of our Company.<br />
Since the promised future performance of our Company was not presented in the offer document, a<br />
comparison of our Company’s actual performance vis-à-vis the projections made in the Offer Document<br />
was not possible.<br />
Issue Programme<br />
The subscription list will open upon the commencement of the banking hours and will close upon the close of<br />
banking hours on the dates mentioned below or on such extended date (subject to a maximum of 60 days) as may<br />
be determined by the Board, subject to necessary approvals:<br />
Issue opens on Last date for receiving requests for Split<br />
Issue closes on<br />
Application Forms<br />
215
[●] [●] [●]<br />
Issue expenses<br />
The total expenses of this Issue are estimated to be approximately Rs. [●]. The Issue related expenses include,<br />
amongst others, issue management fees, brokerage (if any) and printing and distribution expenses, legal fees,<br />
advertisement expenses, registrar and depository fees and listing expenses.<br />
Sr. No<br />
Particulars<br />
Amount<br />
(Rs. in lacs)<br />
1 Fees of Lead Manager, Registrar to Issue, Legal Advisor etc. [●]<br />
2 Advertisement and marketing expenses [●]<br />
3 Printing, stationery, distribution, postage etc [●]<br />
4 Others (including but not limited to Stock Exchage and SEBI filing fees) [●]<br />
Total<br />
[●]<br />
Details of Fees Payable<br />
1 Fees Payable to the Lead Manager.<br />
The total fees payable to the Lead Manager will be as per the Engagement Letter dated January 10, 2008 and as<br />
stated in the Memorandum of Understanding executed between our Company and Lead Manager dated June 30,<br />
2008, copy of which is available for inspection at our Registered Office.<br />
1 Fees Payable to the Registrar to the Issue.<br />
The Fees Payable to the Registrar to the Issue is set out in relevant documents, copies of which are available for<br />
inspection at the Registered Office of our Company at Paragaon Condominium, 3 rd floor, Pandurang, Budhkar<br />
Marg, Mumbai-400013 from 10.00 a.m. to 1.00 p.m., from the date of filing of the Draft Letter of Offer until the<br />
date of closure of the Subscription List.<br />
Companies Under the same Management within the meaning of Section 370(1)(B) of the Act.<br />
There are no listed companies within the same management within the meaning of Section 370(1)(B) of the<br />
Companies Act, 1956.<br />
Stock Market Data for the Equity Shares of our Company<br />
The Equity Shares of our Company are listed on the BSE. The stock market data for BSE, as extracted from its<br />
website, is given below:<br />
i. The following table sets forth, the high and low of daily closing prices of our Equity Shares on BSE<br />
along with the number of Shares traded and the value traded in lacs of Rupees on these days, for a<br />
period of five years to filing of the Draft Letter of Offer, for the periods indicated:<br />
216
2007-<br />
08<br />
2006-<br />
07<br />
2005-<br />
06<br />
2004-<br />
05<br />
2003-<br />
04<br />
Date<br />
January<br />
02, 2008<br />
February<br />
08, 2007<br />
July 22,<br />
2005<br />
February<br />
24, 2005<br />
January<br />
5, 2004<br />
Price<br />
(in<br />
Rs.)<br />
High<br />
No. of<br />
Shares<br />
Traded<br />
Value<br />
for the<br />
day (Rs.<br />
lacs)<br />
46.35 488749 217.00<br />
29.60 139318 37.56<br />
39.50 1781436 667.13<br />
30.90 2441849 709.63<br />
29.45 190089 55.26<br />
Date<br />
April 03,<br />
2007<br />
July 24,<br />
2006<br />
February<br />
07, 2006<br />
June 24,<br />
2004<br />
March<br />
31, 2003<br />
Price<br />
(in<br />
Rs.)<br />
Low<br />
No. of<br />
Shares<br />
Traded<br />
Value<br />
for the<br />
day<br />
(Rs.<br />
lacs)<br />
16.30 16831 2.85 25.67<br />
10.50 17773 2.03 17.32<br />
18.70 10859 20.87 26.54<br />
8.08 4200 0.35 16.18<br />
4.95 3050 0.16 12.98<br />
ii. The following table sets forth, the total value traded in lacs of Rupees of our Equity Shares on BSE, for<br />
a period of five years to filing of the Draft Letter of Offer, for the periods indicated:<br />
Financial Year BSE<br />
2007-08 3270.38<br />
2006-07 12186.45<br />
2005-06 3624.83<br />
2004-05 27372.40<br />
2003-04 5897.95<br />
iii. The following table sets forth, the high and low prices of our Equity Shares on BSE, the number of<br />
Equity Shares traded and the value traded in million of Rupees, in the last six months, for the periods<br />
indicated:<br />
December<br />
January<br />
February<br />
March<br />
April<br />
May<br />
June<br />
Date<br />
December<br />
13, 2007<br />
January<br />
02, 2008<br />
February<br />
04, 2008<br />
March<br />
12, 2008<br />
April<br />
09, 2008<br />
May 13,<br />
2008<br />
June 2,<br />
2008<br />
Price<br />
(in<br />
Rs.)<br />
High<br />
No. of<br />
Shares<br />
traded<br />
Value<br />
for<br />
the<br />
day<br />
(Rs.<br />
lacs)<br />
Date<br />
46.10 410643 177.86<br />
December<br />
04, 2007<br />
46.35 488749 217.00<br />
January<br />
23, 2008<br />
29.95 56298 16.16<br />
February<br />
29, 2008<br />
23.95 366463 75.57<br />
March<br />
24, 2008<br />
24.85 119701 28.08<br />
April<br />
07, 2008<br />
34.90 488620 159.42<br />
May 06,<br />
2008<br />
30.00 70705 20.27 June 25,<br />
2008<br />
Price<br />
(in<br />
Rs.)<br />
Low<br />
No. of<br />
Shares<br />
traded<br />
Value<br />
for<br />
the<br />
day<br />
(Rs.<br />
lacs)<br />
30.20 105750 32.80 6041557<br />
24.35 161089 44.20 4078428<br />
22.00 48607 11.12 1152591<br />
13.55 251945 36.27 2795519<br />
20.50 28113 5.93 1369892<br />
21.65 29190 6.40 1108.94<br />
19.40 47495 10.15 326.82<br />
iv. The closing market price of our Equity Shares on BSE as on May 30, 2008 after the approval of this<br />
issue by our Board of Directors on May 30, 2008 was Rs. 28.50<br />
Issues for consideration other than cash<br />
217
Except as stated in chapter titled “<strong>Capital</strong> Structure” beginning on page 12 of the Draft Letter of Offer, our<br />
Company has not issued Equity Shares for consideration other than cash or out of revaluation reserves.<br />
Outstanding Debentures, Bonds and Preference Shares<br />
Our Company has no outstanding debentures, bonds or preference shares.<br />
Investor Grievances and Redressal System<br />
Our Company has adequate arrangements for redressal of investor complaints. Well-arranged correspondence<br />
system developed for letters of routine nature. The share transfer and dematerialization for our Company is<br />
being handled by registrar and share transfer agent. Letters are filed category wise after having attended to<br />
redressal norm for response time for all correspondence including shareholders complaints is 15 days.<br />
Investor Grievances arising out of this Issue<br />
Our Company’s investor grievances arising out of the Issue will be handled by Satellite Corporate Services Private<br />
Limited, the Registrar to the Issue. The Registrar will have a separate team of personnel handling only our post-<br />
Issue correspondence.<br />
The agreement between our Company and the Registrar provides for retention of records with the Registrar for a<br />
period of at least one year from the last date of dispatch of Letter of Allotment/ share certificate / refund order to<br />
enable the Registrar to redress grievances of investors.<br />
All grievances relating to the Issue may be addressed to the Registrar to the Issue giving full details such as folio<br />
no. name and address, contact telephone / cell numbers, email id of the first applicant, number and type of<br />
shares applied for, Application Form serial number, amount paid on application and the name of the bank and<br />
the branch where the application was deposited, along with a photocopy of the acknowledgement slip. In case of<br />
renunciation, the same details of the Renouncee should be furnished.<br />
The average time taken by the Registrar for attending to routine grievances will be 15 days from the date of<br />
receipt. In case of non-routine grievances where verification at other agencies is involved, it would be the<br />
endeavour of the Registrar to attend to them as expeditiously as possible. We undertake to resolve the Investor<br />
grievances in a time bound manner.<br />
Investors may contact the Company Secretary and Compliance Officer in case of any pre-Issue/ post -Issue<br />
related problems such as non-receipt of letters of allotment/share certificates/demat credit/refund orders etc. His<br />
address is as follows:<br />
Mr. S. Ramachandran<br />
Futura Plyesters Limited<br />
Paragon Condominium,<br />
3 rd Floor, Pandurang Budhkar Marg,<br />
Mumbai – 400 013<br />
Tel: +91-22-24922999<br />
Fax: +91-22-24923142<br />
Email: rightsissue@futurapolyesters.com<br />
Allotment Letters / Refund Orders<br />
Our Company will issue and dispatch letters of allotment/ share certificates/ demat credit and/ or letters of regret<br />
along with refund order or credit the allotted securities to the respective beneficiary accounts, if any, within a<br />
period of six weeks from the Issue Closing Date. Such refund orders, in the form of MICR warrants/cheque/pay<br />
order, marked “Account payee” would be drawn in the name of a sole/first applicant and will be payable at par<br />
at all the centers where the applications were originally accepted, except for those who have opted to receive<br />
refunds through the ECS facility or RTGS or Direct Credit. If such money is not repaid within eight days from<br />
the day our Company becomes liable to pay it, our Company shall pay that money with interest at the rate of<br />
15% p.a. as stipulated under Section 73 of the Act. Letter(s) of Allotment/Refund Order(s) above the value of<br />
Rs. 1500 will be dispatched by registered post to the sole/first applicant’s address. However, Refund Orders for<br />
values not exceeding Rs.1,500/- shall be sent to the applicants under Certificate of Posting at the applicant’s sole<br />
risk at his address. Our Company would make adequate funds available to the Registrar to the Issue for this<br />
purpose. Adequate funds would be made available to the Registrar to the Issue for dispatch of the letters of<br />
allotment/ share certificates/ demat credit/ refund orders.<br />
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In case our Company issues letters of allotment, the corresponding share certificates will be kept ready within<br />
three months from the date of allotment thereof or such extended time as may be approved by the Companies<br />
Law Board under Section 113 of the Companies Act or other applicable provisions, if any. Allottees are<br />
requested to preserve such Letters of Allotment, which would be exchanged later for the share certificates.<br />
Status of Complaints<br />
Details of Complaints received for the period April 1, 2007 to July 04, 2008 are as follows:<br />
Sr. No Details of Investor Complaints No. of Complaints<br />
1. Complaints pending as from on April 01, 2007 Nil<br />
2. Complaints received from April 01, 2007 to July 04, 2008 19<br />
3. Complaints redressed during the period 19<br />
4. Complaints pending at the end of period Nil<br />
Changes in Auditors during the last three years<br />
There has been no change in our Statutory Auditors in last three financial years.<br />
<strong>Capital</strong>isation of Reserves or Profits<br />
Our Company has not capitalized any of its reserves or profits for the last five years other than those mentioned<br />
in the chapter titled“<strong>Capital</strong> Structure” beginning on page 12 of the Draft Letter of Offer.<br />
a) Revaluation of Assets<br />
As our Company’s Plant and Machinery were installed over a period of time during the life of the Company<br />
since its formation, the management decided to revalue the same so as to reflect the appropriate value in the<br />
books of accounts. Accordingly, our Company appointed a Government certified Valuer, namely, M/s Kanti<br />
Karamsey & Co. to revalue the Plant and Machinery at both locations, namely Chennai and Khopoli. The<br />
revaluation was carried out on November 30, 2003, with the intention to assess the intrinsic value of the plant<br />
and machinery. The net increase in the net book value arising out of revaluation has been credited to<br />
Revaluation Reserve Account.<br />
Details of the Revaluation of Assets are here as under:<br />
1. Gross Book Value was computed to be Rs. 38, 618.10 lacs<br />
2. Accumulated Depreciation was computed to be Rs. 18, 198.34 lacs<br />
3. Net Book Value was computed to be Rs. 20, 419.76 lacs<br />
4. Net Revaluation was computed to be Rs. 4145.12 lacs<br />
Total Replacement Cost as on November 30, 2003 was assessed to be Rs. 2199.73 lacs and the Fair Market<br />
Value then was estimated to be Rs. 1336.62 lacs<br />
b) Revaluation of part of land<br />
During the year 2007-2008 our Company appointed M/s. Kanti Karamsey & Co. for the purpose of revaluation<br />
of part of the land. The same was performed on February 16, 2008. The net increase in the net book value<br />
arising out of revaluation has been credited to the Revaluation Reserve Account. Revaluation is based on the<br />
Valuation Report of M/s. Kanti Karamsey & Co. dated February 18, 2008.<br />
Details of the Revaluation of part of the land<br />
1. Gross Book Value was computed to be Rs. 5.28 lacs<br />
2. Accumulated Depreciation was computed to be Nil<br />
3. Net Book Value was computed to be Rs. 5.28 lacs<br />
4. Net Revaluation was computed to be Rs. 14, 089.94 lacs<br />
IMPORTANT<br />
219
1 This Issue is pursuant to the resolutions passed by the Board of Directors at its meeting held on May 30,<br />
2008 wherein issue of Equity Shares on rights basis was approved.<br />
2 This Issue is applicable to those Equity Shareholders whose names appear as beneficial owners as per the<br />
list to be furnished by the depositories in respect of the shares held in the electronic form, and on the<br />
Register of Members of our Company in case of Equity Shares held in physical form at the close of<br />
business hours on the Record Date i.e. [●].<br />
3 Your attention is drawn to the chapter titled ‘Risk Factors’ beginning on page viii of the Draft Letter of<br />
Offer.<br />
4 Please ensure that you have received the Composite Application Form (“CAF”) with the Draft Letter of<br />
Offer.<br />
5 Please read the Draft Letter of Offer and the instructions contained herein and in the CAF carefully before<br />
filling in the CAF. The instructions contained in the CAF are an integral part of the Draft Letter of Offer<br />
and must be carefully followed. An application is liable to be rejected for any non-compliance of the<br />
provisions contained in the Draft Letter of Offer or the CAF.<br />
220
TERMS OF THE ISSUE<br />
The Equity Shares are now being issued pursuant to the Rights Issue and the Equity Shares to be allotted are<br />
subject to the terms and conditions contained in the Draft Letter of Offer, the enclosed Composite Application<br />
Form (“CAF”), the Memorandum and Articles of Association of our Company, the provisions of the Act,<br />
guidelines issued by SEBI, guidelines, notifications and regulations for issue of capital and for listing of<br />
securities issued by Government of India and/or other statutory authorities and bodies from time to time, terms<br />
and conditions as stipulated in the allotment advice or letter of allotment or security certificate and rules as may<br />
be applicable and introduced from time to time.<br />
Authority for the Issue<br />
This Issue is being made pursuant to the resolution passed at the meeting of the Board of Directors of our<br />
Company under Section 81(1)(a) of the Companies Act,1956 as on May 30, 2008<br />
Basis for the Issue<br />
The Equity Shares are being offered for subscription for cash to those existing Equity Shareholders whose<br />
names appear as beneficial owners as per the list to be furnished by the depositories in respect of the shares held<br />
in the electronic form and on the Register of Members of our Company in respect of shares held in the physical<br />
form at the close of business hours on the Record Date, i.e., [●] fixed in consultation with the Designated Stock<br />
Exchange, BSE.<br />
Rights Entitlement Ratio:<br />
As your name appears as beneficial owner in respect of the shares held in the electronic form or appears in the<br />
register of members as an equity shareholder of our Company as on the Record Date i.e. [●]. You are entitled to<br />
the number of shares in Block I of Part A of the enclosed in the Composite Application Form.<br />
The eligible shareholders shall be entitled to the following:<br />
1 One Equity shares for every two Equity Shares held as on the Record Date<br />
Rights Entitlement on Equity Shares held in the pool account of the clearing members on the Record Date shall<br />
be considered, and such claimants are requested to:<br />
1. Approach the concerned depository through the clearing member of the Stock Exchange with requisite<br />
details; and<br />
2. Depository in turn should furnish details of the transaction to the Registrar.<br />
Market lot<br />
The securities of our Company are tradeble only in dematerialized form. In case of holding in physical form, our<br />
Company would issue to the allottees separate certificate for the Equity Shares allotted on rights basis with a<br />
split performance.<br />
Our company would issue one certificate for the entire allotment. However, our Company would issue split<br />
certificates on written requests from the shareholders.<br />
Investors may please note that the Equity Shares of our Company can be traded on the Stock Exchange<br />
in dematerialized form only.<br />
Nomination facility<br />
In terms of Section 109A of the Act, nomination facility is available in case of Equity Shares. The applicant can<br />
nominate any person by filling the relevant details in the CAF in the space provided for this purpose.<br />
A sole Equity Shareholder or first Equity Shareholder, along with other joint Equity Shareholders being<br />
individual(s) may nominate any person(s) who, in the event of the death of the sole holder or all the jointholders,<br />
as the case may be, shall become entitled to the Equity Shares. A person, being a nominee, becoming<br />
entitled to the Equity Shares by reason of the death of the original Equity Shareholder(s), shall be entitled to the<br />
same advantages to which he would be entitled if he were the registered holder of the Equity Shares. Where the<br />
221
nominee is a minor, the Equity Shareholder(s) may also make a nomination to appoint, in the prescribed<br />
manner, any person to become entitled to the Equity Share(s), in the event of death of the said holder, during the<br />
minority of the nominee. A nomination shall stand rescinded upon the sale of the Equity Share by the person<br />
nominating. A transferee will be entitled to make a fresh nomination in the manner prescribed. When the Equity<br />
Share is held by two or more persons, the nominee shall become entitled to receive the amount only on the<br />
demise of all the holders. Fresh nominations can be made only in the prescribed form available on request at the<br />
Registered Office of our Company or such other person at such addresses as may be notified by our Company.<br />
The applicant can make the nomination by filling in the relevant portion of the CAF.<br />
Only one nomination would be applicable for one folio. Hence, in case the Equity Shareholder(s) has/have<br />
already registered the nomination with our Company, no further nomination needs to be made for Equity Shares<br />
to be allotted in this Issue under the same folio.<br />
In case the allotment of Equity Shares is in dematerialised form, there is no need to make a separate nomination<br />
for the Equity Shares to be allotted in this Issue. Nominations registered with respective DP of the applicant<br />
would prevail. If the applicant requires tochange the nomination, they are requested to inform their respective<br />
DP.<br />
Joint-Holders<br />
Where two or more persons are registered as the holders of any Equity Shares, they shall be deemed to hold the<br />
same as joint-holders with benefits of survivorship subject to provisions contained in the Articles of Association<br />
of our Company.<br />
Offer to Non-Resident Equity Shareholders/Applicants<br />
As per regulation 6 of Notification No. FEMA 20/200-RB dated May 3, 2000, the RBI has given general<br />
permission to Indian companies to issue rights shares to non-resident shareholders including additional shares.<br />
Applications received from NRIs and non-residents for allotment of Equity Shares shall be inter alia, subject to<br />
the conditions imposed from time to time by the RBI under the Foreign Exchange Management Act, 1999<br />
(FEMA) in the matter of refund of application moneys, allotment of Equity Shares, issue of letter of allotment /<br />
notification No. FEMA 20/200-RB dated May 3, 2000. The Board of Directors may at its absolute discretion,<br />
agree to such terms and conditions as may be stipulated by RBI while approving the allotment of Equity Shares,<br />
payment of dividend etc. to the non-resident shareholders. The rights shares purchased by non-residents shall be<br />
subject to the same conditions including restrictions in regard to the repatriability as are applicable to the<br />
original shares against which rights shares are issued.<br />
By virtue of Circular No. 14 dated September 16, 2003 issued by the RBI, overseas corporate bodies (“OCBs”)<br />
have been derecognized as an eligible class of investors and the RBI has subsequently issued the Foreign<br />
Exchange Management (Withdrawal of General Permission to Overseas Corporate Bodies (OCBs)) Regulations,<br />
2003. Accordingly, OCBs shall not be eligible to subscribe to the Equity Shares. The RBI has however clarified<br />
in its circular, A.P. (DIR Series) Circular No. 44, dated December 8, 2003 that OCBs which are incorporated<br />
and are not under the adverse notice of the RBI are permitted to undertake fresh investments as incorporated<br />
non-resident entities. Further, the RBI in its Master Circular dated July 1, 2007 has stated that OCBs are not<br />
permitted to subscribe to Equity Shares of Indian companies on rights basis under the automatic route. OCBs<br />
shall not be eligible to subscribe to the Equity Shares pursuant to the Draft Letter of Offer unless prior approval<br />
of the RBI is obtained in this regard.<br />
In this respect, our Company had applied to the RBI for permission for certain named erstwhile OCB<br />
shareholders, which were its shareholders on the date of application to RBI, and the RBI has vide its letter no.<br />
FE.CO.FID/1494/11.01.020(XXX)2008-09 dated July 16, 2008 issued the following clarifications in respect of<br />
the above:<br />
“Please refer to your letter dated June 25, 2008 on the captioned subject.<br />
2. Our clarification seriatim, to the issues raised is as under;<br />
a) The erstwhile OCB shareholders, Persephone Investments Limited, Newbridge Holdings Inc., Morton<br />
Enterprises Inc. and Banabhai Finance Limited are not under adverse notice of RBI and right equity<br />
shares can be offered to them by the company as non-resident entities provided the entities are<br />
incorporated or registered under the relevant statutes, laws of the host country and the share<br />
subscription is received from them by the way of foreign inward remittance through normal banking<br />
channel.<br />
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) They can renounce their right shares in part or in full in favour of resident or in favour of person resident<br />
outside India, who is eligible to invest in the company under the FDI Policy. However, if the renouncee is<br />
an entity reckoned as OCB then the company will have to ensure that such incorporated/registered entity<br />
has not availed of benefits as an OCB and confirm from RBI that the entity is not under adverse notice or<br />
they can apply for additional shares under the Right Issue as incorporated non-resident entities, provided the<br />
share subscription has been received by way of foreign inward remittance and the overall issue of shares by<br />
the company to non-residents in the total paid –up capital does not exceed the sectoral cap for the company.<br />
c) The company can allot the right shares including additional shares subscribed by the above mentioned<br />
erstwhile shareholders subject to conditions specified in Regulation 6(2) of Notification no. FEMA<br />
20/2000-RB dated May 3, 2000.”<br />
A copy of this approval is available for inspection at the Registered Office of our Company as a material<br />
document, as contained in the section tiled “Material Contracts and Documents for Inspection” beginning on<br />
page 284 of the Draft Letter of Offer.<br />
Applications received from the Non-Resident Equity Shareholders for the allotment of Equity Shares, shall,<br />
inter alia, be subject to the conditions as may be imposed from time to time by the RBI, in the matter of refund<br />
of application moneys, allotment of Equity Shares, issue of letters of allotment/ certificates/ payment of<br />
dividends etc.<br />
In case of change of status of holders i.e. from Resident to Non-Resident, a new demat account shall be opened<br />
for the purpose. DETAILS OF SEPARATE COLLECTING CENTRES FOR NON-RESIDENT<br />
APPLICATIONS SHALL BE PRINTED ON THE CAF.<br />
Mode of Payment of Dividend<br />
Dividend, if any declared by the Board and approved by our shareholders, will be paid in any of the modes<br />
permitted by the Companies Act, 1956.<br />
I. Principal Terms of this Rights Issue of Equity Shares<br />
The Equity Shares, now being issued, subject to the provisions of the Act , terms and conditions contained in the<br />
Draft Letter of Offer, the enclosed Composite Application Form (“CAF”), the Memorandum and Articles of<br />
Association of our Company, guidelines issued by SEBI, Foreign Exchange Management Act 1999 (“FEMA”),<br />
guidelines, notifications and regulations for issue of capital and for listing of securities issued by Government of<br />
India and/or other statutory authorities and bodies from time to time, terms and conditions as stipulated in the<br />
allotment advice or letter of allotment or security certificate and rules as may be applicable and introduced from<br />
time to time.<br />
Face value<br />
Each Equity Share shall have the face value of Rs. 10.<br />
Issue Price<br />
Each Equity Share is being offered at a price at par.<br />
Terms of payment<br />
The entire amount of Rs. 10/- per Equity Share shall be payable on application.<br />
The payment on Application would be applied as under:<br />
On Application<br />
Towards Share <strong>Capital</strong><br />
Rs. 10 per Equity Share<br />
A separate cheque/ draft must accompany each Application form.<br />
Payment should be made in cash (not more than Rs.20,000) or by cheque/bank demand draft/ drawn on any<br />
bank (including a co-operative bank) which is situated at and is a member or a sub-member of the bankers<br />
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clearing house located at the center where the CAF is accepted. Outstation cheques /money orders/postal orders<br />
will not be accepted and CAFs accompanied by such cheque/money orders/postal orders are liable to be<br />
rejected.<br />
Where an applicant has applied for additional shares and is allotted lesser number of shares than applied for, the<br />
excess application money shall be refunded. The monies would be refunded within 42 days from the closure of<br />
the Issue, and if there is a delay beyond 8 days from the stipulated period, our Company will pay interest on the<br />
monies in terms of sub-sections (2) and (2A) of section 73 of the Companies Act, 1956.<br />
Ranking of the Equity Shares<br />
The Equity Shares shall be subject to the Memorandum and Articles of Association of our Company. The<br />
dividend payable on Equity Shares allotted in this Issue shall rank for dividend in proportion to the amount paid<br />
up. The Equity Shares allotted in this Issue, shall be pari passu with the existing Equity Shares in all respects<br />
including dividend. For more details see section titled “Articles of Association of the Compnay” beginning on<br />
page 244 of the Draft Letter of Offer.<br />
Rights of Equity Shareholders<br />
Subject to applicable laws, Equity Shareholders shall have the following rights:<br />
1 Right to receive dividend, if declared<br />
2 Right to attend general meetings and exercise voting power, unless prohibited by law;<br />
3 Right to vote on poll, either in person or proxy;<br />
4 Right to receive offer for right shares and be allotted bonus shares if announced;<br />
5 Right to receive surplus on liquidation;<br />
6 Right of free transferability of share; and<br />
7 Such other rights as may be available to a shareholder of a listed public company under the Companies Act<br />
and our Memorandum and Articles of Association of our Company and the terms of the listing agreement<br />
with the Stock Exchange.<br />
For further details on the main provisions of our Company’s Articles of Association dealing with voting rights,<br />
dividend, forfeiture and lien, transfer and transmission and/or consolidation/splitting, please refer section titled<br />
“Articles of Association of the Company” beginning on page 244 of the Draft Letter of Offer.<br />
Fractional entitlements<br />
For Equity Shares being offered on rights basis under this Issue, if the shareholding of any of the Equity<br />
Shareholders is less than two or is not in the multiples of two, the fractional entitlement of such holders shall be<br />
ignored. Shareholders whose fractional entitlements are being ignored would be given preferential allotment of<br />
ONE additional Equity Share each if they apply for additional Equity Shares. The Equity Shares needed for such<br />
rounding off shall be adjusted from the Promoter and Promoter Group’s entitlement at the time of allotment.<br />
Those Equity shareholders having holding less than two Equity Shares and therefore entitled to zero Equity<br />
Shares under this Issue shall be despatched a CAF with zero entitlement. Such Equity Shareholders would be<br />
given preferential allotment of ONE additional Equity Share each. However, they cannot renunciate the same to<br />
third parties. CAF with zero entitlement will be non-negotiable /non-renunciable.<br />
Notices<br />
All notices to the Equity Shareholder(s) required to be given by our Company shall be published in one English<br />
national daily with wide circulation, one Hindi national daily with wide circulation and one regional language<br />
daily newspaper in Mumbai with wide circulation and/or, will be sent by ordinary post/ to the registered holders<br />
of the Equity Share at the address registered with the registrar from time to time.<br />
Procedure for Application<br />
The enclosed CAF for Equity Shares should be completed in all respects in its entirety before submission to the<br />
Bankers to the Issue or their designated branches as they appear in the CAF. The forms of the CAF should not<br />
be detached under any circumstances otherwise the application is liable to be rejected.<br />
The CAF would be sent to all shareholders, with a additional separate advise as may be required for Nonresident<br />
shareholders. In case the original CAF is not received by the applicant or is misplaced by the applicant,<br />
the applicant may request the Registrars to the Issue, Satellite Corporate Services Private Limited, for issue of a<br />
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duplicate CAF, by furnishing the registered folio number, DP ID Number, Client ID Number and their full name<br />
and address.<br />
Non-resident shareholders can obtain a copy of the CAF from the Registrars to the Issue, Satellite Corporate<br />
Services Private Limited, from their office situated at B-302, Sony Apt., Opposite St. Jude’s High School, Off.<br />
Andheri-Kurla Road, Jarimari, Sakinaka, Mumbai-400072 by furnishing the registered folio number, DP ID<br />
number, Client ID number and their full name and address. Equity Shares offered to you can be renounced<br />
either in full or in part in favour of any other person or persons. The renounces shall be entitled to apply for<br />
Equity Shares being offered through the Issue. Such renouncees can only be Indian Nationals/limited companies<br />
incorporated under and governed by the Act, statutory corporations/institutions, trusts (unless registered under<br />
the Indian Trust Act), minors (through their legal guardians), societies (unless registered under the Societies<br />
Registration Act, 1860 or any other applicable laws) provided that such trust/society is authorised under its<br />
constitution/bye laws to hold Equity Shares in a company and cannot be a partnership firm, more than three<br />
persons including joint-holders, HUF, foreign nationals (unless approved by RBI or other relevant authorities)<br />
or to any person situated or having jurisdiction where the offering in terms of the Draft Letter of Offer could be<br />
illegal or require compliance with securities laws.<br />
The CAF consists of four parts:<br />
Part A: Form for accepting the Equity Shares offered and for applying for additional Equity Shares<br />
Part B: Form for renunciation<br />
Part C: Form for application for renouncees<br />
Part D: Form for request for split application forms<br />
Option available to the Equity Shareholders<br />
The Composite Application Form clearly indicates the number of Equity Shares that the Equity Shareholder is<br />
entitled to.<br />
If the Equity Shareholder applies for an investment in Equity Shares, then he can:<br />
1 Apply for his entitlement in part;<br />
2 Apply for his entitlement in part and renounce the other part;<br />
3 Renounce the entire entitlement<br />
4 Apply for his entitlement in full;<br />
5 Apply for his entitlement in full and apply for additional Equity Shares.<br />
Renouncees for Equity Shares can apply for the Equity Shares renounced to them and also apply for additional<br />
Equity Shares. If you renounce your Rights Entitlement, in whole or in part, you shall not be entitled to apply<br />
for additional Equity Shares in this Issue.<br />
The shareholders with zero entitlement can apply for ONE additional Equity Share and they cannot renuounce<br />
the same to third party.<br />
The summary of options available to the Equity Shareholder is presented below. You may exercise any of the<br />
following options with regard to the Equity Shares offered, using the enclosed CAF:<br />
Option Option Available Action Required<br />
A. Accept whole or part of your<br />
entitlement without<br />
renouncing the balance.<br />
B. Accept your entitlement in full<br />
and apply for additional<br />
Equity Shares<br />
C. Renounce your entitlement in<br />
full to one person (Joint<br />
renouncees not exceeding<br />
three are considered as one<br />
renouncee).<br />
Fill in and sign Part A (All joint holders must sign)<br />
Fill in and sign Part A including Block III relating to<br />
the acceptance of entitlement and Block IV relating<br />
to additional Equity Shares (All joint holders must<br />
sign)<br />
Fill in and sign Part B (all joint holders must sign)<br />
indicating the number of Equity Shares renounced<br />
and hand over the entire CAF to the renouncee. The<br />
renouncees must fill in and sign Part C of the CAF<br />
(All joint renouncees must sign)<br />
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D. 1. Accept a part of your<br />
entitlement and renounce the<br />
balance to one or more<br />
renouncee(s)<br />
OR<br />
2.Renounce your entitlement<br />
to all the Equity Shares<br />
offered to you to more than<br />
one renouncee<br />
Fill in and sign Part D (all joint holders must sign)<br />
requesting for Split Application Forms. Send the<br />
CAF to the Registrar to the Issue so as to reach them<br />
on or before the last date for receiving requests for<br />
Split Forms. Splitting will be permitted only once.<br />
On receipt of the Split Form take action as indicated<br />
below.<br />
(i) For the Equity Shares you wish to accept, if any,<br />
fill in and sign Part A of one split CAF (only for<br />
option 1).<br />
(ii) For the Equity Shares you wish to renounce, fill<br />
in and sign Part B indicating the number of Equity<br />
Shares renounced and hand over the split CAFs to<br />
the renouncees.<br />
(iii) Each of the renouncees should fill in and sign<br />
Part C for the Equity Shares accepted by them.<br />
E. Introduce a joint holder or<br />
change the sequence of joint<br />
holders<br />
This will be treated as a renunciation. Fill in and sign<br />
Part B and the renouncees must fill in and sign Part<br />
C.<br />
Option A: Acceptance of the Issue in full or in part<br />
You may accept the Issue and apply for the Equity Shares offered, either in full or in part by filing part A of the<br />
enclosed CAF. For details of submission of CAF and mode of payment please refer to paragraph titled<br />
“Submission of Application and Mode of Payment for Rights Issue of Equity Shares” beginning on page 231 of<br />
the Draft Letter of Offer.<br />
Option B: Additional Equity Shares<br />
You are eligible to apply for additional Equity Shares over and above the number of Equity Shares you are<br />
entitled to, provided that you have applied for all the Equity Shares offered without renouncing them in whole or<br />
in part in favor of any other person(s). The application for additional Equity Shares shall be considered and<br />
allotment shall be made at the sole discretion of the Board and in consultation if necessary with the Designated<br />
Stock Exchange. This allotment of additional Equity Shares will be made on an equitable basis with reference to<br />
number of Equity Shares held by you on the Record Date.<br />
If you desire to apply for additional Equity Shares, please indicate your requirement in the place provided for<br />
additional shares in Part A of the CAF. Applications for additional Equity Shares shall be considered and<br />
allotment shall be in the manner prescribed under the paragraph titled “Basis of Allotment” under chapter titled<br />
“Terms of the Issue” beginning on page 220 of the Draft Letter of Offer. The renouncees applying for all the<br />
Equity Shares renounced in their favor may also apply for additional Equity Shares.<br />
In case of application for additional Equity Shares by Non-Resident Equity Shareholders, the allotment of<br />
additional securities will be subject to the applicable provisions of FEMA.<br />
Where the number of additional Equity Shares applied for exceeds the number available for allotment, the<br />
allotment would be made on a fair and equitable basis in consultation with the Designated Stock Exchange.<br />
In case of change of status of holders i.e. from Resident to Non-Resident, a new demat account shall be opened<br />
for the purpose.<br />
Option C & D: Renunciation<br />
This Issue includes a right exercisable by you to renounce the Equity Shares offered to you either in full or in<br />
part in favour of any other person or persons subject to the approval of the Board. The Right of Renunciation is<br />
attached to the Equity Shares, with one being allotted for every two Equity Shares. Such renouncees can only be<br />
Indian Nationals (including minor through their natural/legal guardian)/limited companies incorporated under<br />
and governed by the Act, statutory corporations/institutions, trusts (registered under the Indian Trust Act),<br />
societies (registered under the Societies Registration Act, 1860 or any other applicable laws) provided that such<br />
226
trust/society is authorised under its constitution/bye laws to hold Equity Shares in a company and cannot be a<br />
partnership firm, foreign nationals or nominees of any of them (unless approved by RBI or other relevant<br />
authorities) or to any person situated or having jurisdiction where the offering in terms of the Draft Letter of<br />
Offer could be illegal or require compliance with securities laws of such jurisdiction or any other persons not<br />
approved by the Board.<br />
Renunciation in favour of non residents / FIIs<br />
Any renunciation from Resident Indian Shareholder(s) to Non-Resident Indian(s) or from Non-Resident Indian<br />
Shareholder(s) to other Non-Resident Indian(s) or from Non-Resident Indian Shareholder(s) to Resident<br />
Indian(s) is subject to the renouncer(s)/renouncee(s) obtaining the approval of the FIPB and/ or necessary<br />
permission of the RBI, if and to the extent required, under the Foreign Exchange Management Act, 1999<br />
(FEMA) and other applicable laws and such permissions should be attached to the CAF. Applications not<br />
accompanied by the aforesaid approval(s), wherever the same are liable to be rejected.<br />
By virtue of the Circular No. 14 dated September 16, 2003 issued by the RBI, Overseas Corporate Bodies<br />
(“OCBs”) have been derecognized as an eligible class of investors and the RBI has subsequently issued the<br />
Foreign Exchange Management (Withdrawal of General Permission to Overseas Corporate Bodies (OCBs)<br />
Regulations, 2003. Accordingly, the existing Equity shareholders of our Company who wish to renounce the<br />
same in favour of renouncees shall not renounce the same (whether for consideration or otherwise) in favour of<br />
OCB(s) except with the prior permission of RBI.<br />
Your attention is drawn to the fact that our Company shall not allot and/or register any Equity Shares in favor<br />
of:<br />
1 More than three persons including joint holders;<br />
2 Partnership firm(s) or their nominee(s);<br />
3 Minors;<br />
4 Hindu Undivided Family; and<br />
5 Any Trust or Society (unless the same is registered under the Societies Registration Act, 1860 or any other<br />
applicable Trust laws and is authorized under its Constitutions to hold Equity Shares of a Company).<br />
The right of renunciation is subject to the express condition that the Board/ Committee of Directors shall be<br />
entitled in its absolute discretion to reject the request for allotment to renouncee(s) without assigning any reason<br />
thereof.<br />
Part A of the CAF must not be used by any person(s) other than those in whose favour this offer has been made.<br />
If used, this will render the application invalid. Submission of the enclosed CAF to the Banker to the Issue at its<br />
collecting branches specified on the reverse of the CAF with the form of renunciation (Part B of the CAF) duly<br />
filled in shall be conclusive evidence for our Company of the person(s) applying for Equity Shares in Part C to<br />
receive allotment of such Equity Shares. The renouncees applying for all the Equity Shares renounced in their<br />
favour may also apply for additional Equity Shares. Part ‘A’ must not be used by the renouncee(s) as this will<br />
render the application invalid. Renouncee(s) will also have no further right to renounce any shares in favour of<br />
any other person.<br />
Procedure for renunciation<br />
To renounce all the Equity Shares offered to a shareholder in favour of one renouncee<br />
If you wish to renounce the offer indicated in Part A, in whole, please complete Part B of the CAF. In case of<br />
joint holding, all joint holders must sign Part B of the CAF. The person in whose favor renunciation has been<br />
made should complete and sign Part C of the CAF. In case of joint renouncees, all joint renouncees must sign<br />
this part of the CAF.<br />
Renouncee(s) shall not be entitled to further renounce their entitlement in favour of any other person.<br />
To renounce in part/or renounce the whole to more than one person(s)<br />
If you wish to either accept this offer in part and renounce the balance or renounce the entire offer in favour of<br />
two or more renouncees, the CAF must be first split into requisite number of forms. For this purpose you shall<br />
have to apply to the Registrar to the Issue.<br />
227
Please indicate your requirement of Split Application Forms in the space provided for this purpose in Part D of<br />
the CAF and return the entire CAF to the Registrar to the Issue so as to reach them latest by the close of<br />
business hours on the last date of receiving requests for Split Application Forms.<br />
On receipt of the required number of split forms from the Registrar, the procedure as mentioned in paragraph<br />
above shall have to be followed.<br />
In case the signature of the Equity Shareholder(s), who has renounced the Equity Shares, does not agree with the<br />
specimen registered with our Company, the application is liable to be rejected.<br />
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Renouncee(s)<br />
The person(s) in whose favour the offer is renounced should fill in and sign Part C of the Application Form and<br />
submit the entire Application Form to the Bankers to the Issue on or before the Issue Closing Date along with<br />
the application money.<br />
Option E: Change and/ or introduction of additional holders<br />
If you wish to apply for Equity Shares jointly with any other person(s), not more than three, who is/are not<br />
already a joint holder with you, it shall amount to renunciation and the procedure as stated above for<br />
renunciation shall have to be followed. Even a change in the sequence of the name of joint holders shall amount<br />
to renunciation and the procedure, as stated above shall have to be followed.<br />
However, this right of renunciation is subject to the express condition that the Board shall be entitled in its<br />
absolute discretion to reject the request for allotment from the renouncee(s) without assigning any reason<br />
thereof.<br />
Please note that:<br />
3 Part A of the CAF must not be used by any person(s) other than those in whose favour this Issue has been<br />
made. If used, this will render the application invalid.<br />
4 Request for split application form should be made for a minimum of one (1) Equity Share or in multiples of<br />
one (1) Equity Share;<br />
5 Request by the applicant for the Split Application Form should reach our Company on or before [●].<br />
6 Only the person to whom the Draft Letter of Offer has been addressed to and not the renouncee(s) shall be<br />
entitled to renounce and to apply for Split Application Forms. Forms once split cannot be split again.<br />
7 Split form(s) will be sent to the applicant(s) by post at the applicant’s risk.<br />
Availability of duplicate CAF<br />
In case the original CAF is not received, or is misplaced by the applicant, the Registrar to the Issue will issue a<br />
duplicate CAF on the request of the applicant who should furnish the registered folio number/ DP and Client ID<br />
number and his/ her full name and address to the Registrar to the Issue. Please note that those who are making<br />
the application in the duplicate form should not utilize the original CAF for any purpose including renunciation,<br />
even if it is received/ found subsequently. Thus in case the original and duplicate CAFs are lodged for<br />
subscription, allotment will be made on the basis of the duplicate CAF and the original CAF will be ignored.<br />
Our Company or the Registrar to the Issue will not be responsible for postal delays or loss of duplicate CAF in<br />
transit, if any.<br />
Application on Plain Paper<br />
An Equity Shareholder who has neither received the original CAF nor is in a position to obtain the duplicate<br />
CAF may make an application to subscribe to the Issue on plain paper, along with an Account Payee Cheque<br />
drawn on a local bank / Demand Draft payable at Mumbai which should be drawn in favor of "FPL-Rights<br />
Issue" in case of resident shareholders and non-resident shareholders applying on nonrepatriable basis and in<br />
favour of " FPL-Rights Issue - NR" in case of non-resident shareholders applying on repatriable basis and<br />
marked “A/c Payee Only” and send the same by registered post directly to the Registrar to the Issue so as to<br />
reach them on or before the closure of the Issue. The envelope should be superscribed " FPL-Rights Issue " in<br />
case of resident shareholders and non-resident shareholders applying on nonrepatriable basis, and in favour of "<br />
FPL-Rights Issue - NR" in case of non-resident shareholders applying on repatriable basis.<br />
The application on plain paper, duly signed by the applicant(s) including joint holders, in the same order as per<br />
specimen recorded with our Company, must reach the office of the Registrar to the Issue before the Issue<br />
Closing Date and should contain the following particulars:<br />
8 Name of Issuer, Futura Polyesters Limited<br />
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9 Name and address of the Equity Shareholder including joint holders<br />
10 Registered Folio Number/ DP ID No. and Client ID No.<br />
11 Number of shares held as on Record Date<br />
12 Certificate numbers and distinctive numbers, if held in physical form.<br />
13 Number of Rights Equity Shares entitled<br />
14 Number of Rights Equity Shares applied for<br />
15 Number of additional Equity Shares applied for, if any<br />
16 Total number of Equity Shares applied for<br />
17 Total amount paid on application at the rate of Rs. 10/- per Equity Share<br />
18 Particulars of cheque/demand draft<br />
19 Savings/Current Account Number and name and address of the bank where the Equity Shareholder will<br />
be depositing the refund order.<br />
20 PAN/GIR number, Income Tax Circle/Ward/District, photocopy of the PAN card/ PAN<br />
communication / Form 60 / Form 61 declaration where the application is for Equity Shares<br />
21 Signature of Equity Shareholders to appear in the same sequence and order as they appear in the<br />
records of our Company.<br />
22 In case of Non Resident Shareholders, NRE/ FCNR/ NRO A/c No. Name and Address of the Bank and<br />
Branch;<br />
23 If payment is made by a draft purchased from NRE/ FCNR/ NRO A/c No., as the case may be, an<br />
Account debit certificate from the bank issuing the draft, confirming that the draft has been issued by<br />
debiting NRE/ FCNR/ NRO Account.<br />
Attention of the shareholders is drawn to the fact that those shareholders making the application otherwise than<br />
on the CAF (i.e. on a plain paper as stated above) shall not be entitled to renounce their rights and should not<br />
utilise the CAF for any purpose including renunciation even if it is received subsequently. In case the original<br />
and duplicate CAFs and application on the plain paper or any two of these applications are lodged or if any<br />
shareholder violates any of these requirements, our company will have the absolute right to reject any one or<br />
both of his/her/their application and refund the application money received. However, our Company is not liable<br />
to pay any interest whatsoever on money so refunded. Please refer to paragraph titled “Submission of<br />
Application and Mode of Payment for Rights Issue of Equity Shares” on page 231 of the Draft Letter of Offer.<br />
230
SUBMISSION OF APPLICATION & MODE OF PAYMENT FOR RIGHTS ISSUE OF EQUITY<br />
SHARES<br />
Resident Equity Shareholders/ Applicants<br />
1 Applicants who are applying through CAF and residing at places where the bank collection centres<br />
have been opened by our Company for collecting applications, are requested to submit their<br />
applications at the corresponding collection centre together with a local cheque/Demand Draft of<br />
amount net of bank charges, for the full application amount favouring "[●]" and marked ‘A/c Payee<br />
only’.<br />
2 Applicants who are applying through CAF and residing at places other than places where the bank<br />
collection centres have been opened for collecting applications, are requested to send their applications<br />
together with a cheque/demand draft of amount net of bank and postal charges, for the full application<br />
amount favouring "[●]" and marked ‘A/c Payee only’ payable at Mumbai directly to the Registrar to<br />
the Issue by registered post so as to reach them on or before the Issue Closing Date. Our Company or<br />
the Registrar to the Issue will not be responsible for postal delays or loss of applications in transit, if<br />
any.<br />
3 Applicants who are applying on plain paper, are requested to send their applications on plain paper<br />
together with a local cheque/demand draft of amount net of bank and postal charges, for the Equity<br />
Shares favouring "[●]" and marked ‘A/c Payee only’ payable at Mumbai directly to the Registrar to<br />
the Issue by registered post so as to reach them on or before the Issue Closing Date. Our Company or<br />
the Registrar to the Issue will not be responsible for postal delays or loss of applications in transit, if<br />
any.<br />
Non-Resident Equity Shareholders / Applicants<br />
Application with repatriation benefits<br />
Non-Resident Equity Shareholders / Applicants, applying on a repatriation basis, are required to submit the<br />
completed CAF / application on plain paper, as the case may be, alongwith the payment made through any of<br />
the following ways:<br />
4 By Indian Rupee drafts purchased from abroad or funds remitted from abroad (submitted along with<br />
Foreign Inward Remittance Certificate); or<br />
5 By cheque / bank drafts remitted through normal banking channels or out of funds held in Non--<br />
Resident External Account (NRE) or FCNR Account maintained with banks authorized to deal in<br />
foreign currency in India, along with documentary evidence in support of remittance; or<br />
6 FIIs registered with SEBI must remit funds from special non-resident rupee deposit account.<br />
1 For Equity Shareholders / Applicants , applying through CAF, the CAF is to be sent at the bank<br />
collection centre specified in the CAF along with cheques/drafts in favour of "[●]" payable at<br />
Mumbai and crossed ‘A/c Payee only’ for the amount payable.<br />
2 For Equity Shareholders / Applicants, applying on a plain paper, the applications are to be directly sent<br />
to the Registrar to the Issue by registered post along cheques/drafts in favour of "[●]" payable at<br />
Mumbai and crossed ‘A/c Payee only’ for the amount payable so as to reach them on or before the<br />
Issue Closing Date.<br />
A separate cheque or bank draft must accompany each application form. Applicants may note that where<br />
payment is made by drafts purchased from NRE/FCNR accounts as the case may be, an Account Debit<br />
Certificate from the bank issuing the draft confirming that the draft has been issued by debiting the NRE/FCNR<br />
account should be enclosed with the CAF. In the absence of the above the application shall be considered<br />
incomplete and is liable to be rejected.<br />
In the case of NRIs who remit their application money from funds held in FCNR/NRE Accounts, refunds and<br />
other disbursements, if any shall be credited to such account details of which should be furnished in the<br />
appropriate columns in the CAF. In the case of NRIs who remit their application money through Indian Rupee<br />
Drafts from abroad, refunds and other disbursements, if any will be made in any convertible foreign currency at<br />
231
the rate of exchange prevailing at such time subject to the permission of RBI. Our Company will not be liable<br />
for any loss on account of exchange rate fluctuation for converting the Rupee amount into any convertible<br />
foreign currency or for collection charges charged by the applicant’s Bankers.<br />
Our Company or the Registrar to the Issue will not be responsible for postal delays or loss of application in<br />
transit, if any<br />
Payments through Non Resident Ordinary Account [NR(O)a/c] will not be permitted.<br />
Application without repatriation benefits<br />
For non-residents Equity Shareholders / Applicants applying on a non-repatriation basis, in addition to the<br />
modes specified above, payment may also be made by way of cheque drawn on Non-Resident (Ordinary)<br />
Account or Rupee Draft purchased out of NRO Account. In such cases, the allotment of Equity Shares will be<br />
on non-repatriation basis.<br />
For Equity Shareholders/Applicants, applying through CAF, the CAF is to be sent at the bank collection centre<br />
specified in the CAF along with cheques/demand drafts drawn net of bank and postal charges in favor of "[●]"<br />
payable at Mumbai and crossed ‘A/c Payee only’ for the amount payable.<br />
For Equity Shareholders/Applicants, applying on a plain paper, the applications are to be directly sent to the<br />
Registrar to the Issue by registered post along with cheques/demand drafts net of bank and postal charges drawn<br />
in favor of "[●]" payable at Mumbai so as to reach them on or before the Issue Closing Date.<br />
If the payment is made by a draft purchased from an NRO account, an Account Debit Certificate from the bank<br />
issuing the draft, confirming that the draft has been issued by debiting the NRO account, should be enclosed<br />
with the CAF. In the absence of the above, the application shall be considered incomplete and is liable to be<br />
rejected.<br />
Our Company or the Registrar to the Issue will not be responsible for postal delays or loss of application in<br />
transit, if any<br />
Note:<br />
1 In case where repatriation benefit is available, interest, dividend, sales proceeds derived from the<br />
investment in Equity Shares can be remitted outside India, subject to tax, as applicable according to<br />
Income Tax Act, 1961.<br />
2 In case Equity Shares are allotted on non-repatriation basis, the dividend and sale proceeds of the Equity<br />
Shares cannot be remitted outside India.<br />
3 The CAFs duly completed together with the amount payable on application must be deposited with the<br />
collecting bank indicated on the reverse of the CAFs before the close of business hours on or before the<br />
Issue Closing Date. Separate cheque or bank draft must accompany each CAF.<br />
4 In case of an application received from non-residents, allotment, refunds and other distribution, if any,<br />
will be made in accordance with the guidelines/ rules prescribed by RBI as applicable at the time of<br />
making such allotment, remittance and subject to necessary approvals.<br />
Last date of Application<br />
The last date for submission of the duly filled in CAF is [●]. The Issue will be kept open for a minimum of 30<br />
(thirty) days and the Board or any committee thereof will have the right to extend the said date for such period<br />
as it may determine from time to time but not exceeding 60 (sixty) days from the Issue Opening Date.<br />
If the CAF together with the amount payable is not received by the Banker to the Issue/ Registrar to the Issue on<br />
or before the close of banking hours on the aforesaid last date or such date as may be extended by the Board, the<br />
offer contained in the Draft Letter of Offer shall be deemed to have been declined and the Board shall be at<br />
liberty to dispose off the Equity Shares hereby offered, as provided under the section chapter “Basis of<br />
Allotment” beginning on page 233 of the Draft Letter of Offer.<br />
232
General<br />
Applications should be made only on the prescribed CAFs provided by our Company and should be complete in<br />
all respects. Applications which are not complete or which are not accompanied with remittance of the proper<br />
amount calculated as aforesaid are liable to be rejected and the money paid in respect thereof will be refunded<br />
without interest.<br />
Our Company will not allot any Equity Shares in favour of:<br />
1 more than three persons as joint holders (including the first holder), in the case of renouncees<br />
2 a partnership firm<br />
3 a trust or society (unless such trust or society is registered under the Societies Registration Act, 1860 and it<br />
is authorised under its Memorandum & Articles of Association and/or its Rules & Bye Laws to hold shares<br />
in a company)<br />
4 a minor (unless application is made through a guardian)<br />
5 HUF<br />
6 any renouncee(s) whom the Board may not approve of<br />
In case the applicants in the above categories are already shareholders of our Company, they will be eligible for<br />
their entitlement. In case of applications made under a Power of Attorney (POA) or by Limited Companies or<br />
Bodies Corporate or Societies, a certified true copy of the relevant POA or the relevant resolution or authority to<br />
make the application as the case may be, along with the copy of the Memorandum & Articles of Association<br />
and/or Bye laws must be lodged for scrutiny giving the serial number of the CAF with the Registrars to the<br />
issue, simultaneously with the submission of the CAF failing which the application is liable to be rejected. In<br />
case the POA is already registered with our Company, the same need not be furnished again. However, the serial<br />
number under which the POA has been registered with our Company, must be mentioned below the signature(s)<br />
of the concerned applicants(s).<br />
The CAF must be filled in English in BLOCK LETTERS.<br />
In case of joint holders, all joint holders must sign the CAF at the appropriate places in the same order as per<br />
specimen signatures recorded in the Register of Members of our Company / Depository.<br />
Signatures in languages other than those prescribed in the 8th Schedule of the Constitution of India and thumb<br />
impressions must be attested by a Magistrate or a Notary Public or a Special Executive magistrate under his/her<br />
official seal.<br />
In case of renouncee(s), the name of the applicant(s), details of occupation, address and father’s/husband’s name<br />
must be filled in Block Letters.<br />
The CAF must be submitted to the Collection Centres as mentioned in the CAF/ Registrar to the Issue, as the<br />
case may be, in its entirety. If any of the parts A, B, C, D and the acknowledgement of the CAF is/are detached<br />
or separated, such applications will be rejected forthwith.<br />
Any dispute or suit or action or proceeding arising out of or in relation to the Draft Letter of Offer or this Issue<br />
or in respect of any matter or thing contained therein and any claim by either party against the other shall be<br />
instituted or adjudicated upon or decided solely by the appropriate Court in Mumbai.<br />
All communications in connection with your application for the Equity Shares should be addressed to the<br />
Registrars to the Issue.<br />
Basis of Allotment<br />
Subject to the provisions contained in the Draft Letter of Offer, the Articles of Association of our Company and<br />
the approval of the Designated Stock Exchange, the Board will proceed to allot our Equity Shares in the<br />
following order of priority:<br />
(a)<br />
(b)<br />
Full allotment to those Equity Shareholders who have applied for their rights entitlement either in full<br />
or in part and also to the renouncee(s) who has/ have applied for Equity Shares renounced in their<br />
favour, in full or in part.<br />
For Equity Shares being offered on rights basis under this issue, if the Equity shareholding of any of<br />
the Equity Shareholders is less than two or not in multiple of two, then the fractional entitlement of<br />
233
such holders shall be ignored and would be given preferential allotment of ONE additional Equity<br />
Share each if they apply for additional share. Allotment under this head shall be considered if there are<br />
any un-subscribed Equity Shares under (a). If number of Equity Shares available for allotment after<br />
allotment under this head are less than number of shares available after allotment under (a), the<br />
allotment would be made on a fair and equitable basis in consultation with the Designated Stock<br />
Exchange.<br />
SHAREHOLDERS HOLDING LESS THAN 2 EQUITY SHARES AND THEREFORE ENTITLED<br />
FOR ZERO EQUITY SHARES UNDER THIS ISSUE WILL NOT HAVE A RIGHT TO<br />
RENOUNCE. SUCH EQUITY SHAREHOLDERS ARE ENTITLED TO APPLY FOR ONE<br />
ADDITIONAL EQUITY SHARE. HOWEVER THEY CAN NOT RENOUNCE THE SAME TO<br />
THIRD PARTIES. CAF WITH ZERO ENTITLEMENT SHALL BE NON-NEGOTIABLE / NON-<br />
TRANSFERABLE.<br />
(c)<br />
(d)<br />
(e)<br />
Allotment to the Equity Shareholders who having applied for all the Equity Shares offered to them as<br />
part of the Issue and have also applied for additional Equity Shares. The allotment of such additional<br />
Equity Shares will be made as far as possible on an equitable basis having due regard to the number of<br />
Equity Shares held by them on the Record Date, provided there is an under-subscribed portion after<br />
making full allotment in (a) and (b) above. The allotment of such Equity Shares will be at the discretion<br />
of the Right Issue Committee in consultation with the Designated Stock Exchange, as a part of the<br />
Issue and not as preferential allotment.<br />
Allotment to the renouncees who having applied for the Equity Shares renounced in their favour have<br />
also applied for additional Equity Shares, provided there is an under-subscribed portion after making<br />
full allotment in (a), (b) and (c) above. The allotment of such additional Equity Shares will be made on<br />
a proportionate basis at the sole discretion of the Board/ Committee of Directors but in consultation<br />
with the Designated Stock Exchange, as a part of the Issue and not as a preferential allotment.<br />
Allotment to any other person as the Board may in its absolute discretion deem fit provided there is<br />
surplus available after making full allotment under (a), (b), (c) and (d) above.<br />
After taking into account allotment to be made under (a) and (b) above, if there is any undersubscribed portion,<br />
the same would be available for allocation under (c), (d) and (e) above. In the event of undersubscription, our<br />
Promoters and either by themselves or through one or more Promoter Group Entities intend to apply for<br />
additional Equity Shares in accordance with the undertaing and disclosures as mentioned in the chapter titled<br />
“<strong>Capital</strong> Structure” beginning on page 12 of the Draft Letter of Offer.<br />
Our Promoters have confirmed that each of them intend to subscribe to the full extent of their entitlement in the<br />
Issue. Our Promoters reserve their right to subscribe to their entitlement in the Rights Issue either by themselves,<br />
their relatives or through one or more Promoter Group Entities, including by subscribing for renunciation, if<br />
any, made by any of the Promoters to any other Promoter and/ or an affiliate thereof. Our Promoters may apply<br />
for additional Equity Shares in the Issue. As a result of this subscription and consequent allotment as stated<br />
above, the Promoters (and others as mentioned above) may acquire shares over and above their entitlement in<br />
the Issue, which may result in an increase of the shareholding being above the current shareholding with the<br />
entitlement of Equity Shares under the Issue.<br />
This subscription and acquisition of additional Equity Shares by the Promoter(s) (and others as mentioned<br />
above), if any, will not result in change of control of the management of our Company and shall be exempt in<br />
terms of the proviso to Regulation 3(1)(b)(ii) of the Takeover Code.<br />
After such allotments as above and to the Promoters, including the application for rights/renunciation and<br />
additional Equity Shares, any additional Equity Shares shall be disposed off by the Board of our Company, in<br />
such manner as they think most beneficial to our Company and the decision of the Board of our Company in this<br />
regard shall be final and binding. In the event of oversubscription, allotment will be made within the overall size<br />
of the Issue<br />
Allotment to Promoters of any unsubscribed portion, over and above their entitlement shall be done in<br />
compliance with Clause 40A of the Listing Agreement and the other applicable laws prevailing at that time.<br />
Our Company expects to complete the allotment of Equity Shares within a period of 42 days from the date of<br />
closure of the Issue in accordance with the listing agreement with BSE. Our Company shall retain no<br />
oversubscription.<br />
234
Listing and Trading of the Equity Shares proposed to be Issued<br />
Our Company’s existing Equity Shares are currently traded on the BSE under the ISIN IN 564A01017. The<br />
fully paid up Equity Shares proposed to be issued on a rights basis shall be listed and admitted for trading on the<br />
BSE under the existing ISIN IN 564A01017 for fully paid Equity Shares of our Company. The fully paid up<br />
Equity Shares allotted pursuant to this Issue will be listed as soon as practicable but in no case later than 7<br />
working days from the date of allotment.<br />
Printing of Bank Particulars on Refund Orders<br />
As a matter of precaution against possible fraudulent encashment of refund orders due to loss or misplacement,<br />
the particulars of the applicant’s bank account are mandatorily required to be given for printing on the refund<br />
orders. Bank account particulars will be printed on the refund orders which can then be deposited only in the<br />
account specified. Our Company will in no way be responsible if any loss occurs through these instruments<br />
falling into improper hands either through forgery or fraud.<br />
Mode of Allotment and Refund<br />
Applicants residing at 68 centres where clearing houses are managed by the Reserve Bank of India (RBI), will<br />
get refunds through ECS only except where applicant is otherwise disclosed as eligible to get refunds through<br />
Direct Credit, RTGS & NEFT. In case of other applicants, Company shall ensure despatch of refund orders, if<br />
any, of value up to Rs.1,500 by “Under Certificate of Posting”, and shall dispatch refund orders above Rs.1,500,<br />
if any, by registered post or speed post. Applicants to whom refunds are made through Electronic transfer of<br />
funds will be send a letter through ordinary post intimating them about the mode of credit of refund within 42<br />
days of closure of this Issue.<br />
In accordance with the requirements of the Stock Exchange and SEBI Guidelines, our Company undertakes that:<br />
1 Allotment, despatch of refund orders/refund instructions shall be done within 42 days of closure of this<br />
Issue;<br />
2 If such money is not repaid within 8 days from the day specified above, our Company shall pay interest<br />
at 15% per annum.<br />
The funds required for dispatch of refund orders/ allotment letters/ certificates by registered post/Speed post or<br />
any other mode disclosed in the Draft Letter of Offer shall be made available by our Company to the Registrar<br />
to the Issue.<br />
Refunds orders will be made by cheques, pay orders or demand drafts drawn on the Refund Bank (s) and<br />
payable at par at places where the applications were received and will be marked account payee and will be<br />
drawn in the name of Sole /First applicant. The bank charges, if any, for encashing such cheques, pay orders or<br />
demand drafts at other centres will be payable by the Applicants.<br />
Payment of Refund<br />
Applicants should note that on the basis of name of the applicants, Depository Participant’s name, Depository<br />
Participant-Identification number and Beneficiary Account Number provided by them in the Composite<br />
Application Form, the Registrar to the Issue will obtain from the Depositories, the applicant’s bank account<br />
details including nine digit MICR code. Hence, applicants are advised to immediately update their bank<br />
account details as appearing on the records of the depository participant. Please note that failure to do so<br />
could result in delays in credit of refunds to applicants at the applicants sole risk and neither the Lead Manager<br />
nor our Company shall have any responsibility and undertake any liability for the same.<br />
The payment of refund, if any, would be done through various modes in the following order of preference:<br />
I. ECS<br />
Payment of refund would be done through ECS for applicants having an account at one of the following centres:<br />
Centres<br />
1. Ahmedabad 2. Nashik 3. Sholapur 4. Gorakhpur<br />
5. Bangalore 6. Panaji 7. Ranchi 8. Jammu<br />
9. Bhubaneshwar 10. Surat 11. Tirupati (non- 12. Indore<br />
235
MICR)<br />
13. Kolkata 14. Trichy 15. Dhanbad(non- 16. Pune<br />
MICR)<br />
17. Chandigarh 18. Trichur 19. Nellore (non- 20. Salem<br />
MICR)<br />
21. Chennai 22. Jodhpur 23. Kakinada 24. Jamshedpur<br />
(non- MICR)<br />
25. Guwahati 26. Gwalior 27. Agra 28. Visakhapatnam<br />
29. Hyderabad 30. Jabalpur 31. Allahabad 32. Mangalore<br />
33. Jaipur 34. Raipur 35. Jalandhar 36. Coimbatore<br />
37. Kanpur 38. Calicut 39. Lucknow 40. Rajkot<br />
41. Mumbai 42. Siliguri 43. Ludhiana 44. Kochi/Ernakulam<br />
(non-<br />
MICR)<br />
45. Nagpur 46. Pondicherry 47. Varanasi 48. Bhopal<br />
49. New Delhi 50. Hubli 51. Kolhapur 52. Madurai<br />
53. Patna 54. Shimla 55. Aurangabad 56. Amritsar<br />
(non-<br />
MICR)<br />
57. Thiruvananthapuram 58. Tirupur 59. Mysore 60. Haldia (non-<br />
61. Baroda 62. Burdwan<br />
(non-<br />
MICR)<br />
65. Dehradun 66. Durgapur<br />
(non-<br />
MICR)<br />
MICR)<br />
63. Erode 64. Vijaywada<br />
67. Udaipur 68. Bhilwara<br />
This would be subject to availability of complete Bank Account Details including MICR code wherever<br />
applicable from the depository. The payment of refund through ECS is mandatory for applicants having a bank<br />
account at any of the 68 centres as mentioned in SEBI circular no. SEBI/ CFD/DILDIP / 29 / 2008 /01/02 dated<br />
February 1, 2008 named herein above, except where applicant is otherwise disclosed as eligible to get refunds<br />
through NEFT or Direct Credit or RTGS.<br />
II.<br />
NEFT<br />
Payment of refund shall be undertaken through NEFT wherever the applicants’ bank has been assigned<br />
the Indian Financial System Code (IFSC), which can be linked to a Magnetic Ink Character<br />
Recognition (MICR) , if any, available to that particular bank branch. IFSC Code will be obtained<br />
from the website of RBI as on a date immediately prior to the date of payment of refund, duly mapped<br />
with MICR numbers. Wherever the applicants have registered their nine digit MICR number and their<br />
bank account number while opening and operating the demat account, the same will be duly mapped<br />
with the IFSC Code of that particular bank branch and the payment of refund will be made to the<br />
applicants through this method.<br />
236
III.<br />
Direct Credit<br />
Applicants applying through the web/internet whose service providers opt to have the refund amounts<br />
for such applicants being by way of direct disbursement by the service provider through their internal<br />
networks, the refund amounts payable to such applicants will be directly handled by the service<br />
providers and credited to bank account particulars as registered by the applicant in the demat account<br />
being maintained with the service provider. The service provider, based on the information provided by<br />
the Registrar, shall carry out the disbursement of the refund amounts to the applicants.<br />
IV.<br />
RTGS<br />
Applicants having a bank account at any of the 68 centres where such facility has been made available<br />
and whose refund amount exceeds Rs. 1 million, have the option to receive refund through RTGS.<br />
Such eligible applicants who indicate their preference to receive refund through RTGS are required to<br />
provide the IFSC code in the CAF. In the event the same is not provided, refund shall be made through<br />
ECS. Charges, if any, levied by the Refund Bank(s) for the same would be borne by such applicant<br />
opting for RTGS as a mode of refund. Charges, if any, levied by the applicant’s bank receiving the<br />
credit would be borne by the applicant.<br />
Only or all the other applicants except for whom payment of refund is possible through I, II, III and IV, the<br />
refund orders would be despatched “Under Certificate of Posting” for refund orders less than Rs.1,500/- and<br />
through Speed Post/Registered Post for refund orders exceeding Rs.1,500/-. Such refunds will be made by<br />
cheques, pay orders or demand drafts drawn in favour of the sole/first applicant and payable at par.<br />
For shareholders opting for allotment in physical mode, bank account details as mentioned in the CAF<br />
shall be considered for electronic credit or printing of refund orders, as the case may be. Refund orders<br />
will be made by cheques, pay orders or demand drafts drawn on the Refund Bank(s) and payable at par<br />
at places where the applications were received and will be marked account payee and will be drawn in the<br />
name of Sole/First Applicant. The bank charges, if any, for encashing such cheques, pay orders or<br />
demand drafts at other centres will be payable by the Applicants.<br />
Refund payment to Non-Resident<br />
Where applications are accompanied by Indian rupee drafts purchased abroad and payable at Mumbai(as<br />
otherwise specified in this section titled “Terms of the Issue”), refunds will be made in convertible foreign<br />
exchange equivalent to Indian rupees to be refunded. Indian rupees will be converted into foreign exchange at<br />
the rate of exchange, which is prevailing on the date of refund. The exchange rate risk on such refunds shall be<br />
borne by the concerned applicant and our Company shall not bear any part of the risk.<br />
Where the applications made are accompanied by NRE/FCNR/NRO cheques, refunds will be credited to<br />
NRE/FCNR/NRO accounts respectively, on which such cheques were drawn and details of which were provided<br />
in the CAF. Export of letters of allotment (if any)/ share certificates/ demat credit to non-resident allottees will<br />
be subject to the approval of RBI.<br />
Shareholder’s Depository Account and Bank details<br />
Shareholder’s applying for shares in demat mode should note that on the basis of the name of the shareholder(s),<br />
Depository Participant’s Name, Depository Participant’s Identification Number and Beneficiary Account<br />
Number provided by them in the CAF, the Registrars to the Issue will obtain from the Depository the<br />
demographic details including the address, Shareholders bank account details, MICR code and occupation<br />
(hereinafter referred to as ‘Demographic Details’). These bank account details would be used for giving refunds<br />
to the shareholder(s). Hence, the shareholder(s) are requested to immediately updated their bank account details<br />
as appearing in the records of the Depository Participant. Please note that failure to do so could result in delays<br />
in dispatch / credit of refunds to the shareholder(s) at the shareholder(s) sole risk and neither the Lead<br />
Manager’s or the Registrars or the Refund Bankers nor our Company shall have any responsibility and<br />
undertake any liability for the same. Hence, applicants should carefully fill their Depository Account details in<br />
the Composite Application Form.<br />
These demographic details would be used for all correspondences with the shareholder(s) including mailing of<br />
Allotment advice and printing of bank particulars on the refund order or for refunds through electronic transfer<br />
of funds, as applicable. By signing the Composite Application Form the shareholder(s) would be deemed to<br />
have authorized the depositories to provide, upon request, to the Registrar to the Issue, the required<br />
Demographic Details as available in its records.<br />
237
In case of shareholder(s) receiving refunds through electronic transfer of funds, delivery of refund<br />
orders/allocation advice gets delayed if the same once sent to the address obtained from the depositories are<br />
returned undelivered.<br />
Option to receive Equity Shares in Dematerialized Form<br />
Applicants to the Equity Shares of our Company issued through this Issue shall be allotted the securities in<br />
dematerialised (electronic) form at the option of the applicant. Our Company has signed agreements dated<br />
March 24, 2005 and March 03, 2005 with NSDL and CDSL respectively, which enables the Investors to hold<br />
and trade in securities in a dematerialised form, instead of holding the securities in the form of physical<br />
certificates.<br />
In this Issue, the allottees who have opted for Equity Shares in dematerialised form will receive their Equity<br />
Shares in the form of an electronic credit to their beneficiary account with a depository participant. The CAF<br />
shall contain space for indicating number of shares applied for in demat and physical form or both. Investor will<br />
have to give the relevant particulars for this purpose in the appropriate place in the CAF. Applications, which do<br />
not accurately contain this information, will be given the securities in physical form. Separate applications for<br />
securities in physical and/or dematerialized form should be made. Separate applications are made, the<br />
application for physical securities will be treated as multiple applications and is liable to be rejected. In case of<br />
partial allotment, allotment will be done in demat option for the shares sought in demat and balance, if any, will<br />
be allotted in physical shares.<br />
The Equity Shares of our Company will be listed on the BSE<br />
Procedure for availing the facility for allotment of Equity Shares in this Issue in the electronic form is as under:<br />
1 Open a beneficiary account with any depository participant (care should be taken that the beneficiary<br />
account should carry the name of the holder in the same manner as is exhibited in the records of our<br />
Company. In the case of joint holding, the beneficiary account should be opened carrying the names of<br />
the holders in the same order as with our Company). In case of Investors having various folios in our<br />
Company with different joint holders, the Investors will have to open separate accounts for such<br />
holdings. Those Equity Shareholders who have already opened such Beneficiary Account (s) need not<br />
adhere to this step.<br />
2 For Equity Shareholders already holding Equity Shares of our Company in dematerialized form as on<br />
the Record Date, the beneficial account number shall be printed on the CAF. For those who open<br />
accounts later or those who change their accounts and wish to receive their Equity Shares by way of<br />
credit to such account, the necessary details of their beneficiary account should be filled in the space<br />
provided in the CAF. It may be noted that the allotment of Equity Shares arising out of this Issue may<br />
be made in dematerialized form even if the original Equity Shares of our Company are not<br />
dematerialized. Nonetheless, it should be ensured that the Depository Account is in the name(s) of the<br />
Equity Shareholders and the names are in the same order as in the records of our Company.<br />
Responsibility for correctness of information (including applicant’s age and other details) filled in the CAF visà-vis<br />
such information with the applicant’s depository participant, would rest with the applicant. Applicants<br />
should ensure that the names of the applicants and the order in which they appear in CAF should be the same as<br />
registered with the applicant’s depository participant.<br />
If incomplete / incorrect beneficiary account details are given in the CAF or where the investor does not opt to<br />
receive the Rights Equity shares in dematerialized form, the applicant will get Equity Shares in physical form.<br />
Applicants must necessarily fill in the details (including the beneficiary account number or client ID number)<br />
appearing in the CAF under the heading ‘Request for shares in Electronic Form’.<br />
Applicants should ensure that the names of the Applicants and the order in which they appear in the CAF should<br />
be the same as registered with the Applicant’s depository participant.<br />
The Rights Equity Shares pursuant to this Issue allotted to investors opting for dematerialized form, would be<br />
directly credited to the beneficiary account as given in the CAF after verification. Allotment advice, refund<br />
order (if any) would be sent directly to the applicant by the Registrar to the Issue but the applicant’s depository<br />
participant will provide to him the confirmation of the credit of such Equity Shares to the applicant’s depository<br />
account.<br />
238
Renouncees will also have to provide the necessary details about their beneficiary account for allotment of<br />
securities in this Issue. In case these details are incomplete or incorrect, the application is liable to be rejected.<br />
Renouncees can also exercise the option to receive Equity Shares in the demat form by indicating in the relevant<br />
column in the CAF and providing the necessary details about their beneficiary account. It may be noted that<br />
Equity Share arising out of this Issue can be received in demat form even if the existing Equity Shares are held<br />
in physical form. Nonetheless, it should be ensured that the depository participant account is in the name of the<br />
Applicant(s) in the same order as per specimen signatures appearing in the records of the depository<br />
participant/Company. It may be noted that shares in electronic form can be traded only on the Stock Exchange<br />
having electronic connectivity with NSDL or CDSL.<br />
Dividend or other benefits with respect to the Equity Shares held in dematerialised form would be paid to those<br />
Equity Shareholders whose names appear in the list of beneficial owners given by the depository participant to<br />
our Company as on the Record Date.<br />
INVESTORS MAY PLEASE NOTE THAT THE EQUITY SHARES OF OUR COMPANY CAN BE<br />
TRADED ON THE STOCK EXCHANGE ONLY IN DEMATERIALIZED FORM.<br />
.<br />
III. General Instruction<br />
Payment by Stockinvest<br />
In terms of RBI Circular DBOD No. FSC BC 42/24.47.00/2003- 04 dated November 5, 2003, the Stockinvest<br />
Scheme has been withdrawn with immediate effect. Hence, payment through Stockinvest would not be accepted<br />
in this Issue<br />
Underwriting<br />
The present Issue is not underwritten.<br />
Issue Period<br />
Issue Opens on [●], 2008<br />
Last date for receiving request for Split Application Forms [●], 2008<br />
Issue Closes on [●], 2008<br />
Minimum Subscription<br />
If our Company does not receive the minimum subscription of 90% of this Issue on the date of closure of the<br />
Issue, the entire subscription shall be refunded to the applicants within 42 days from the date of closure of this<br />
Issue. If there is a delay in the refund of subscription by more than 8 days after our Company becomes liable to<br />
pay the subscription amount (i.e. 42 days after closure of this Issue), our Company shall pay interest for the<br />
delayed period, at rates prescribed under sub-sections (2) and (2A) of Section 73 of the Companies Act 1956.<br />
Under-subscription in the Issue will be determined after considering the number of shares applied as per the<br />
entitlement plus additional shares applied by existing shareholders and the renouncees. The undersubscribed<br />
portion can be applied for only after the close of the Issue. Our Promoters, either by themselves or through their<br />
relatives or through one or more Promoter Group Entities, have undertaken to subscribe upto the extent of<br />
minimum subscription, i.e. 90% of the Issue size, if the Issue is undersubscribed to ensure that the Issue is<br />
successful. This acquisition of additional Equity Shares, if allotted as aforesaid shall be in terms of proviso to<br />
Regulation 3(1) (b) (ii) of the Takeover Code and will be exempt from the applicability of Regulations 11 and<br />
12 of Takeover Code. This disclosure is made in terms of the requirement of Regulation 3(1) (b) (ii) of the<br />
Takeover Code. Further, this acquisition will not result in change of control of management of our Company.<br />
In case the permission to deal in and for an official quotation of the Equity Shares is not granted by the Stock<br />
Exchange, the Issuer shall forthwith repay without interest, all monies received from the applicants in pursuance<br />
of the Draft Letter of Offer and if such money is not repaid within eight days after the day from which the Issuer<br />
239
is liable to repay it, the Issuer shall pay interest as prescribed under Section 73(2) / 73(2A) of the Companies<br />
Act, 1956.<br />
Allotment Schedule<br />
1 Our Company agrees that as far as possible allotment of securities offered to the shareholders shall be made<br />
within 42 days from the date of the closure of the Issue.<br />
2 Our Company further agrees that it shall pay interest @ 15% per annum for the delayed period if the<br />
allotment has not been made and/or allotment letters / the refund orders have not been despatched to the<br />
applicants/ refund instruction beyond 8 days from the date specified above.<br />
Disposal of applications and application money<br />
No separate receipt will be issued for application money received. However, the collection centres as listed in<br />
the CAF, will acknowledge its receipt by stamping and returning the acknowledgement slip at the bottom of<br />
each CAF. In the event of shares not being allotted in full, the excess amount paid on application will be<br />
refunded to the applicant or the refund instructions will be given within 2 working days from the date of<br />
finalisation of basis of allotment.<br />
The Board reserves its full, unqualified and absolute right to accept or reject any application in whole or in part<br />
and in either case without assigning any reason therefore. In case an application is rejected in full the whole of<br />
the application money received will be refunded to the applicant. Where an application is rejected in part, the<br />
excess application money, if any will be refunded to the applicant.<br />
For further instruction, please read the Composite Application Form (CAF) carefully.<br />
Unsubscribed Equity Shares<br />
The unsubscribed portion, if any of the Equity Shares offered to the shareholders, after considering the<br />
application for Rights/Renunciation and additional Equity Shares, as above, shall be disposed by the Board of<br />
our Company or Committee of Directors authorised in this behalf by the Board of our Company at their full<br />
discretion and absolute authority, in such manner as they think most beneficial to our Company and the decision<br />
of the Board of our Company or Committee of Directors in this regard shall be final and binding. In case the<br />
Company issues Letter(s) of Allotment, the relative Share Certificate(s) will be kept ready within 3 months from<br />
the date of allotment thereof or such extended time as may be approved by the Company Law Board or other<br />
applicable provisions, if any. Allottees are requested to preserve such Letters of Allotment, which would be<br />
exchanged later for Share Certificate(s).<br />
General instructions for applicants<br />
(a)<br />
(b)<br />
(c)<br />
(d)<br />
Please read the instructions printed on the enclosed CAF carefully.<br />
Application should be made on the printed CAF, provided by our Company except as mentioned under<br />
the head Application on Plain Paper and should be completed in all respects. The CAF found<br />
incomplete with regard to any of the particulars required to be given therein, and/ or which are not<br />
completed in conformity with the terms of the Draft Letter of Offer are liable to be rejected and the<br />
money paid, if any, in respect thereof will be refunded without interest and after deduction of bank<br />
commission and other charges, if any. The CAF must be filled in English and the names of all the<br />
applicants, details of occupation, address, father’s / husband’s name must be filled in block letters.<br />
Payments should be made in cash/cheque/demand draft drawn on any bank which is situated at and is a<br />
member of sub-member of the banker’s clearing house located at the centre where application is<br />
accepted. Outstation cheques/ demand drafts will not be accepted and application(s) accompanied by<br />
such cheques/demand drafts will be rejected. The Registrar will not accept cash along with CAF<br />
The CAF together with cheque / demand draft should be sent to the Bankers to the Issue / Collecting<br />
Bank or to the Registrar to the Issue and not to our Company or Lead Manager to the Issue. Applicants<br />
residing at places other than cities where the branches of the Bankers to the Issue have been authorised<br />
by our Company for collecting applications, will have to make payment by Demand Draft payable at<br />
Mumbai of amount net of bank and postal charges, and send their application forms to the Registrar to<br />
the Issue by REGISTERED POST. If any portion of the CAF is / are detached or separated, such<br />
application is liable to be rejected.<br />
240
(e)<br />
PAN Number: Whenever the application(s) is/are made, the applicant or in the case of an application in<br />
joint names, each of the applicants, should mention his/her Permanent Account Number (PAN) allotted<br />
under the IT Act. The copy of the PAN card or PAN allotment letter is not required to be submitted<br />
with the CAF. Applications without this information and documents will be considered incomplete and<br />
are liable to be rejected. It is to be specifically noted that Applicant should not submit the GIR number<br />
instead of the<br />
PAN as the application is liable to be rejected on this ground. In terms of SEBI Circular bearing no.<br />
MRD/DoP/Cir-20/2008 dated June 30, 2008, certain categories of investors (namely the Central<br />
Government, State Government, and the officials appointed by the courts e.g. Official liquidator, Court<br />
receiver etc. (under the category of Government)) shall be exempted from submitting their PAN, only<br />
if such organisations submit sufficient documentary evidence to support the veracity of their claim for<br />
such exemption.<br />
(f)<br />
(g)<br />
(h)<br />
(i)<br />
(j)<br />
(k)<br />
(l)<br />
Bank Account Details: It is mandatory for applicants to provide information as to their savings/current<br />
account number and the name of the bank with whom such account is held in the CAF to enable the<br />
Registrar to the Issue to print the said details in the refund orders, if any, after the names of the payees.<br />
Application not containing such details is liable to be rejected. Shareholders may please note that for<br />
shares held in DEMAT mode, the bank account details shall be obtained from the depositories.<br />
Shareholders may ensure that the bank account details are updated with the depositories.<br />
Payment by cash: The payment against the application should not be effected in cash if the amount to<br />
be paid is Rs. 20,000 or more. In case payment is effected in contravention of this, the application may<br />
be deemed invalid and the application money will be refunded and no interest will be paid thereon.<br />
Payment against the application if made in cash, subject to conditions as mentioned above, should be<br />
made only to the Bankers to the Issue.<br />
Signatures should be either in English or Hindi or in any other language specified in the Eight Schedule<br />
to the Constitution of India. Signatures other than in English or Hindi and thumb impression must be<br />
attested by a Notary Public or a Special Executive Magistrate under his/ her official seal. The Equity<br />
Shareholders must sign the CAF as per the specimen signature recorded with our Company or<br />
depositories.<br />
In case of an application under power of attorney or by a body corporate or by a society, a certified true<br />
copy of the relevant power of attorney or relevant resolution or authority to the signatory to make the<br />
relevant investment under this Issue and to sign the application and a copy of the Memorandum and<br />
Articles of Association and / or bye laws of such body corporate or society must be lodged with the<br />
Registrar to the Issue giving reference of the serial number of the CAF. In case the above referred<br />
documents are already registered with our Company, the same need not be a furnished again. In case<br />
these papers are sent to any other entity besides the Registrar to the Issue or are sent after the Issue<br />
Closing Date, then the application is liable to be rejected. In no case should these papers be attached to<br />
the application submitted to the Bankers to the Issue.<br />
In case of joint holders, all joint holders must sign the relevant part of the CAF in the same order and as<br />
per the specimen signature(s) recorded with our Company. Further, in case of joint applicants who are<br />
renouncees, the number of applicants should not exceed three. In case of joint applicants, reference, if<br />
any, will be made in the first applicant’s name and all communication will be addressed to the first<br />
applicant.<br />
Application(s) received from Non-Resident / NRIs, or persons of Indian origin residing abroad for<br />
allotment of Equity Shares shall, inter alia, be subject to conditions, as may be imposed from time to<br />
time by the RBI under FEMA in the matter of refund of application money, allotment of Equity Shares,<br />
subsequent issue and allotment of Equity Shares, interest, export of share certificates, etc. In case a<br />
Non-Resident or PIO/NRI Equity Shareholder has specific approval from the RBI, in connection with<br />
his shareholding, he should enclose a copy of such approval with the CAF.<br />
All communication in connection with application for the Equity Shares, including any change in<br />
address of the Equity Shareholders should be addressed to the Registrar to the Issue prior to the date of<br />
allotment in this Issue quoting the name of the first / sole applicant Equity Shareholder, folio numbers<br />
and CAF number. Please note that any intimation for change of address of Equity Shareholders, after<br />
the date of allotment, should be sent to Registrar to our Company; Satellite Corporate Services Private<br />
Limited, B-302, Sony Apt., Opposite St. Jude’s High School, Off. Andheri-Kurla Road, Jarimari,<br />
Sakinaka, Mumbai- 400072, in the case of Equity Shares held in physical form and to the respective<br />
depository participant, in case of Equity Shares held in dematerialized form.<br />
241
(m)<br />
(n)<br />
(o)<br />
(p)<br />
(q)<br />
(r)<br />
Split Application Forms cannot be re-split.<br />
Only the person or persons to whom Equity Shares have been offered and not renouncee(s) shall be<br />
entitled to obtain split forms.<br />
Applicants must write their CAF number at the back of the cheque / demand draft.<br />
Only one mode of payment per application should be used. The payment must be either in cash or by<br />
cheque / demand draft drawn on any of the banks, including a co-operative bank, which is situated at<br />
and is a member or a sub member of the Bankers Clearing House located at the centre indicated on the<br />
reverse of the CAF where the application is to be submitted.<br />
A separate cheque / draft must accompany each CAF. Outstation cheques / demand drafts or post-dated<br />
cheques and postal / money orders will not be accepted and applications accompanied by such cheques<br />
/ demand drafts / money orders or postal orders will be rejected. The Registrar will not accept payment<br />
against application if made in cash. (For payment against application in cash please refer point (f)<br />
above)<br />
No receipt will be issued for application money received. The Bankers to the Issue / Collecting Bank/<br />
Registrar will acknowledge receipt of the same by stamping and returning the acknowledgment slip at<br />
the bottom of the CAF.<br />
Grounds For Technical Rejections<br />
Applicants are advised to note that applications are liable to be rejected on technical grounds, including the<br />
following:<br />
1 CAFs, which are not completed or are not accompanied with the application money payable, are liable to<br />
be rejected;<br />
2 Amount paid does not tally with the amount payable for;<br />
3 In case of physical shareholders, bank account details (for refund) are not given;<br />
4 Age of first applicant not given;<br />
5 PAN allotted under the IT Act has not been mentioned by the applicant;<br />
6 In case of Application under power of attorney or by limited companies, corporate, trust, etc., relevant<br />
documents are not submitted;<br />
7 If the signature of the existing shareholder does not match with the one given on the Application Form<br />
and for renouncees if the signature does not match with the records available with their depositories;<br />
8 If the Applicant desires to receive Equity Shares in electronic form, but the CAF does not have the<br />
Applicant’s depository account details;<br />
9 CAF are not submitted by the Applicants within the time prescribed as per the CAF and the Draft Letter<br />
of Offer;<br />
10 Applications not duly signed by the sole/joint Applicants;<br />
11 Applications by OCBs unless approved by RBI;<br />
12 Applications accompanied by Stockinvest;<br />
13 In case no corresponding record is available with the Depositories that matches three parameters,<br />
namely, names of the Applicants (including the order of names of joint holders), the Depositary<br />
Participant’s identity (DP ID) and the beneficiary’s identity;<br />
14 Applications by ineligible Non-residents on account of restriction or prohibition under applicable local<br />
laws.<br />
242
3 Multiple applications<br />
Disposal of application and application money<br />
No acknowledgment will be issued for the application moneys received by our Company. However, the Bankers<br />
to the Issue / Registrar to the Issue receiving the CAF will acknowledge its receipt by stamping and returning<br />
the acknowledgment slip at the bottom of each CAF.<br />
The Board reserves its full, unqualified and absolute right to accept or reject any application, in whole or in part,<br />
and in either case without assigning any reason thereto.<br />
In case an application is rejected in full, the whole of the application money received will be refunded.<br />
Wherever an application is rejected in part, the balance of application money, if any, after adjusting any money<br />
due on Equity Shares allotted, will be refunded to the applicant within six weeks from the close of the Issue in<br />
accordance with Section 73 of the Companies Act, 1956.<br />
For further instruction, please read the paragraph titled “Options available to the Equity Shareholders”<br />
beginning on page 225 of the Draft Letter of Offer carefully.<br />
Utilisation of Issue Proceeds<br />
The Board of Directors declares that:<br />
(i)<br />
(ii)<br />
(iii)<br />
The funds received against this Issue will be transferred to a separate bank account other than the bank<br />
account referred to sub-section (3) of Section 73 of the Companies Act, 1956.<br />
Details of all moneys utilised out of the Issue shall be disclosed under an appropriate separate head in<br />
the balance sheet of our Company indicating the purpose for which such moneys has been utilised.<br />
Details of all such unutilised moneys out of the Issue, if any, shall be disclosed under an appropriate<br />
separate head in the balance sheet of our Company indicating the form in which such unutilised<br />
moneys have been invested.<br />
The funds received against this Issue will be kept in a separate bank account and our Company will not have any<br />
access to such funds unless it satisfies the Designated Stock Exchange with suitable documentary evidence that<br />
the minimum subscription of 90% of this Issue has been received by our Company.<br />
Interest in Case of Delay in Despatch of Allotment Letters/ Refund Orders<br />
Our Company will issue and dispatch letters of allotment/ share certificates and/ or letters of regret along with<br />
refund order or credit the allotted securities to the respective beneficiary accounts, if any within a period of six<br />
weeks from the date of closure of the Issue. If such money is not repaid within 8 days from the day our<br />
Company becomes liable to pay it, our Company shall pay that money with interest at the rate of 15% per<br />
annum as stipulated under Section 73 of the Act, 1956.<br />
Our Company agrees that as far as possible the allotment of the Equity Shares shall be made within fourty two<br />
(42) days of the closure of Issue.<br />
Undertakings by our Company<br />
1. The complaints received in respect of the Issue shall be attended to by our Company expeditiously and<br />
satisfactorily.<br />
2. All steps for completion of the necessary formalities for listing and commencement of trading at the<br />
Stock Exchange where the securities are to be listed will be taken within seven working days of<br />
finalization of basis of allotment.<br />
3. The funds required for dispatch of refund orders/ allotment letters/ certificates by registered post or any<br />
other mode disclosed in the Draft Letter of Offer shall be made available to the Registrar to the Issue.<br />
4. Where refunds are made through electronic transfer of funds, a suitable communication shall be sent to<br />
the investors within 42 days of closure of the Issue giving details of the bank where refunds shall be<br />
credited along with the amount and expected date of electronic credit of refund.<br />
243
5. The certificates of the securities/ refund orders to the valid applicants shall be dispatched within the<br />
specified time.<br />
6. Except as mentioned in the chapter titled “<strong>Capital</strong> Structure” beginning on page 12 of the draft Letter<br />
of Offer, no further issue of securities affecting equity capital of our Company shall be made till the<br />
securities issued/offered through the Issue are listed or till the application moneys are refunded on<br />
account of non-listing, under-subscription etc.<br />
7. Our Company accepts full responsibility for the accuracy of information given in the Draft Letter of<br />
Offer and confirms that to best of its knowledge and belief, there are no other facts the omission of<br />
which makes any statement made in the Draft Letter of Offer misleading and further confirms that it<br />
has made all reasonable enquiries to ascertain such facts.<br />
8. All information shall be made available by the Lead Manager and the Issuer to the investors at large<br />
and no selective or additional information would be available for a section of the investors in any<br />
manner whatsoever including at road shows, presentations, in research or sales reports etc.<br />
Important<br />
4 Please read the Draft Letter of Offer carefully before taking any action. The instructions contained in the<br />
accompanying Composite Application Form (CAF) are an integral part of the conditions of the Draft<br />
Letter of Offer and must be carefully followed; otherwise the application is liable to be rejected.<br />
5 All enquiries in connection with the Draft Letter of Offer or accompanying CAF and requests for Split<br />
Application Forms must be addressed (quoting the Registered Folio Number/ DP and Client ID number,<br />
the CAF number and the name of the first Equity Shareholder as mentioned on the CAF and superscribed<br />
‘[●]’ on the envelope) to the Registrar to the Issue at the following address:<br />
Satellite Corporate Services Private Limited<br />
B-302, Sony Apt., Opposite St. Jude’s High School,<br />
Off. Andheri-Kurla Road, Jarimari,<br />
Sakinaka, Mumbai – 400072, India<br />
1 It is to be specifically noted that this Issue of Equity Shares is subject to the chapter entitled “Risk<br />
Factors” beginning on page viii of the Draft Letter of Offer<br />
6 Our Company will not be liable for any postal delays and applications received through mail after the<br />
closure of the Issue, are liable to be rejected and returned to the applicants.<br />
The Issue will not be kept open for more than 30 days unless extended, in which case it will be kept open<br />
for a maximum of 60 days.<br />
244
SECTION VIII: ARTICLES OF ASSOCIATION OF THE COMPANY<br />
ARTICLES OF ASSOCIATION OF <strong>FUTURA</strong> <strong>POLYESTERS</strong> <strong>LIMITED</strong><br />
Note : By a Special Resolution of the Company passed at an Annual General<br />
Meeting of the company held on the 8 th day of September, 1976 these Articles<br />
were adopted as the Article of Association of the Company in substitution for, and<br />
to the exclusion of, all the existing Articles thereof.<br />
Table A not to apply but<br />
Company to be governed<br />
by these Articles<br />
1. No regulation contained in Table A, in the First Schedule to the<br />
Companies Act, 1956 shall apply to this Company but the regulations for the<br />
management of the Company and for the observance of the members thereof and<br />
their representatives, shall subject to any exercise of the statutory powers of the<br />
Company with reference to the repeal or alteration, as prescribed by the said<br />
Companies Act, 1956, be such as are contained in these Articles.<br />
INTERPRETATION<br />
Interpretation clause. 2. In the interpretation of these Articles, unless repugnant to the subject or<br />
context :-<br />
The Company of “this<br />
Company”<br />
“The Act”.<br />
“Auditors”<br />
“Board” or “Board of<br />
Directors”.<br />
“<strong>Capital</strong>”.<br />
“Debenture”.<br />
“Directors”.<br />
“Dividend”<br />
“Gender”.<br />
“In writing” and<br />
“Written”<br />
“Member”.<br />
“Meeting or “General<br />
Meeting”<br />
“The Company” or “this Company” means <strong>FUTURA</strong> <strong>POLYESTERS</strong> <strong>LIMITED</strong>”<br />
“The Act” means `the Companies Act, 1956”, or any statutory modification or reenactment<br />
thereof for the time being in force.<br />
“Auditors” means and includes those persons appointed as such for the time being<br />
by the Company.<br />
“Board or Board of Directors” means a meeting of the Directors duly called and<br />
constituted, or as the case may be, the Directors assembled at the Board of<br />
Directors of the Company Collectively.<br />
“<strong>Capital</strong>” means the share capita for the time being raised or authorised to be<br />
raised, for the purpose of the Company.<br />
“Debenture” includes debenture-stock.<br />
“Directors” means the Dire4ctors for the time being of the Company or, as the<br />
case may be, the Directors assembled at a Board.<br />
“Dividend” includes bonus.<br />
Words importing the masculine gender also include the feminine gender.<br />
“In Writing” and “Written” include printing, lithography and other modes or<br />
representing or reproducing words in visible form.<br />
“Member” means the duly registered holder from time to time of the share of the<br />
Company and includes the subscribers of the Memorandum of Association of the<br />
Company.<br />
“Meeting” or “General Meeting” means a meeting of members.<br />
“Annual<br />
Meeting”.<br />
General<br />
“Annual General Meeting” means a general meeting of the Members held in<br />
accordance with the provision of Section 166 of the Act.<br />
“Extraordinary General<br />
Meeting.<br />
“Extraordinary General Meeting” means an extraordinary general meeting of the<br />
members duly called and constituted and any adjourned holding thereof.<br />
“Month”.<br />
“Month” means a calendar month.<br />
245
“Office”.<br />
“Office” means the registered office for the time being of the Company.<br />
“Paid-up”. “Paid-up” includes credited as paid u.<br />
“Persons”<br />
“Register of Members”.<br />
“The Registrar”<br />
“Secretary”<br />
“Seal”<br />
“Share”<br />
“Singular Number”<br />
“Ordinary Resolution”<br />
and “Special Resolution”<br />
“Year” and “Financial<br />
Year”.<br />
“Persons” includes corporation and firms as well as individuals.<br />
“Register of Members” means the Register of Members to be Kept pursuant to the<br />
Act.<br />
“The Registrar” means the Registrar of Companies of the State in which the office<br />
of the Company is for the time being situate.<br />
“Secretary” means any individual appointed by the Board to perform any of the<br />
duties of a Secretary under the Act and any other ministerial or administrative<br />
duties and includes a temporary, deputy or assistant Secretary.<br />
“Seal” means the Common Seal for the time being of the Company.<br />
“Share” means share in the share capital of the Company and includes stock<br />
except where a distinction between stock and shares is expressed or implied.<br />
“Words” importing the singular number include, where the context admits or<br />
requires, the plural number and vice versa.<br />
“Ordinary Resolution” and “Special Resolution” shall have the meanings assigned<br />
thereto by Section 189 of the Act.<br />
“Year” means the calendar year and “Financial Year” shall have the meaning<br />
assigned thereto by Section 217) of the Act.<br />
The marginal notes used in the Articles shall not affect the construction hereto.<br />
Save as aforesaid, any words or expression defined in the Act shall, if not<br />
inconsistent with the subject or context bear the same meaning in these Articles.<br />
CAPITAL AND INCREASE AND REDUCTION OF CAPITAL<br />
Amount of Authorised<br />
<strong>Capital</strong><br />
Increase of <strong>Capital</strong> by the<br />
Company and how<br />
carried into effect.<br />
New <strong>Capital</strong> same as<br />
existing capital.<br />
3. The Authorised Share <strong>Capital</strong> of the Company is Rs.80,00,00,000/-<br />
(Rupees Eighty crores) divided into 7,90,00,000 (Seven Ninety lacs) Equity<br />
Shares of Rs.10/- (Rupees ten) each and 1,00,000 (One lac) Cumulative<br />
Redeemable Preference Shares of Rs.100/- (Rupees one hundred) each.<br />
4. The Company in General Meeting may, from time to time, by an<br />
Ordinary Resolution increase the capital by the creation of new shares, such<br />
increase to be of such aggregate amount and to be divided into shares of such<br />
respective amounts as the resolution shall prescribe. Subject to the provisions of<br />
the Act any shares of the original or increased capital shall be issued upon such<br />
terms and conditions and with such rights and privileges annexed thereto, as the<br />
General Meeting resolving upon the creation thereof, shall direct, and if no<br />
direction be given as the Directors shall determine; and in particular, such shares<br />
may be issued with a preferential or qualified right to dividends, and in the<br />
distribution of assets of the Company, and with a right of voting at general<br />
meetings of the Company in conformity with Sections 87 and 88 of the Act.<br />
Whenever the capital of the Company has been increased under the provisions of<br />
this Articles, the Directors shall comply with the provisions of Section 97 of the<br />
Act.<br />
5. Except so far as otherwise provided by the conditions of issue or by these<br />
Articles, any capital raised by the creation of new Shares shall be considered as<br />
part of the original capital, and shall be subject to the provisions herein contained,<br />
with reference to the payment of calls and instalments, forfeiture, lien, surrender,<br />
transmission, voting and otherwise.<br />
Redeemable Preference 6. Subject to the provisions of Section 80 of the Act, the Company shall<br />
246
Shares.<br />
9.3% Cumulative<br />
Redeemable Preference<br />
Shares<br />
have the power to iss7ue Preference Shares which are, or at the option of the<br />
Company are liable to be redeemed and the resolution authorizing such issue shall<br />
prescribe the manner, terms and conditions of redemption.<br />
7. (a) The Cumulative Redeemable Preference Shares shall confer<br />
upon the holders thereof the right out of the Profits of the Company resolved to be<br />
distributed to a fixed Cumulative preferential dividend at the rate of 9% per<br />
annum (free of Company’s tax but subject to deduction of tax at source as<br />
required under the provisions of the Indian Income Tax Act for the time being in<br />
force) on the capital for the time being paid up there on and the right in a winding<br />
up to payment of capital and arrears of dividends whether declared or undeclared<br />
up to the commencement of the winding up in priority to the Equity Shares, but<br />
shall not confer the right to any further participation in profits or assets, except<br />
that the holders thereof shall have the right to attend and vote at any general<br />
meeting of the Company as provided by the Act.<br />
(b) The Preference shares shall be definitely redeemed at the expiry<br />
of 10 years from the date of allotment. Provided, however, that the Company shall<br />
have the option to redeem the same earlier but not earlier than 5 years from the<br />
date of allotment.<br />
(c) The Company shall not create and/or issue preference shares in<br />
future ranking in priority to the 9.3% preference shares already issued and in the<br />
event of its creating and/or issuing preference shares, in future ranking pari passu<br />
with the said 9.3% preference shares, it would do so only with the consent in<br />
writing of the holders of not less than 3/4ths of the preference shares then<br />
outstanding or with the sanction of a special resolution passed at a separate<br />
meeting of the holders of the preference shares.<br />
Reduction of <strong>Capital</strong> 8. The Company may (subject to the provisions of Sections 78, 80, 100 to<br />
105 inclusive of the Act) from time to time by Special Resolution, reduce its<br />
capital, any <strong>Capital</strong> Redemption Reserve Account and Share Premium Account in<br />
any manner for the time being authorised by law, and in particular capital may be<br />
paid off on the footing that it may be called upon again or otherwise. This Article<br />
is not to derogate from any power the Company would have if it were omitted.<br />
Sub-division and<br />
cancellation of shares.<br />
9. Subject to the provisions of Section 94 of the Act the Company in<br />
general meeting may, from time to time, sub-divide or consolidate its shares, or<br />
any of them, and the resolution whereby any share is sub-divided, may determine<br />
that as between the holders of the shares resulting from such sub-division one or<br />
more of such shares shall have some preference or special advantage as regards<br />
dividend, capital or otherwise over or as compared with the others or other.<br />
Subject as aforesaid the Company in general meeting may also cancel shares<br />
which have not been taken or agreed to be taken by any person and diminish the<br />
amount of its share capital by the amount of the shares so called.<br />
Modification of rights. 10. Whenever the capital, by reason of the issue of Preference Shares or<br />
otherwise, is dividend into different classes of shares, all or any of the rights and<br />
privileges attached to each class may subject to the provision of Sections 105 and<br />
107 of the Act be modified, commuted, affected or abrogated, or dealt with by<br />
Agreement between the Company and any person purporting to contract on behalf<br />
of that class, provided such agreement is ratified in writing by holders of at least<br />
three-fourths in nominal value of the issued shares of the class or is confirmed by<br />
a Special Resolution passed at a separate general meeting of the holders of shares<br />
of that class.<br />
SHARES AND CERTIFICATES<br />
Register and Index of<br />
Members<br />
Declaration by person<br />
not holding beneficial<br />
11. The Company shall cause to be kept a Register and Index of Members in<br />
accordance with Sections 150 and 151 of the Act. The Company shall be entitled<br />
to keep in any State or country outside India a branch Register of Members<br />
resident in that State or country.<br />
12. (a) Notwithstanding anything herein contained a person whose<br />
name is at any time entered into the Register of Members of the Company as the<br />
247
Interests in any shares.<br />
holder of a share in that Company, but who does not hold the beneficial interest in<br />
such share, shall within such time and in such form as may be prescribed, make a<br />
declaration to the Company specifying the name and other particulars of the<br />
person or persons who hold the beneficial interest in such share in the manner<br />
provided in section 187-C of the Act.<br />
(b) A person who holds a beneficial interest in a share or a class of<br />
shares of the Company shall, within the time prescribed, after his becoming such<br />
beneficial owners, make a declaration to the Company specifying the nature of his<br />
interest, particulars of the person in whose name the shares stand in the Register<br />
of Members of the Company and such other particulars as may be prescribed as<br />
provided in Section 187-C of the Act.<br />
(c) Whenever there is a change in the beneficial interest in a share<br />
referred to above, the beneficial owner shall, within the time prescribed from the<br />
date of such change make a declaration to the Company in such form and<br />
containing such particulars as may be prescribed as provided in Section 187-C of<br />
the Act.<br />
(d) Notwithstanding anything herein contained in Section 153 of<br />
the Act and Article 12 hereof, where any declaration referred to above is made to<br />
the Company, the Company shall make a note of such declaration in the Register<br />
of Members and file within the time prescribed from the date of receipt of the<br />
declaration a return in the prescribed form within the Registrar with regard to such<br />
declaration.<br />
Shares to be numbered<br />
progressively and no<br />
share to be sub-divided.<br />
13. The shares in the capital shall be numbered progressively according to<br />
their several denominations, and except in the manner hereinbefore mentioned no<br />
share shall be sub-divided. Every forfeited or surrendered share shall continue to<br />
bear the number by which the same was originally distinguished.<br />
Further Issue of <strong>Capital</strong> 14. (a) Where at any time after the expiry of two years from the<br />
formation of the Company or at any time after the expiry of one year from the<br />
allotment of shares in the Company made for the first time after its formation<br />
whichever is earlier it is proposed to increase the subscribed capital of the<br />
Company by allotment of further shares, whether out of unissued share capital or<br />
out of increased share capital, then such further shares shall be offered to the<br />
persons who at the date of the offer, are holders of the equity shares of the<br />
Company, in proportion, as nearly as circumstances admit, to the capital paid up<br />
on these shares at that date. Such offer shall be made by a notice specifying the<br />
number of shares offered and limiting a time not being less than fifteen days from<br />
the date of the offer within which the offer, if not accepted, will be deemed to<br />
have been declined. After the expiry of the time specified in the notice aforesaid<br />
or on receipt of earlier intimation from the person to whom such notice is given<br />
that he declines to accept the shares offered, the Board may dispose of them in<br />
such manner as they think most beneficial to the Company.<br />
(b) Notwithstanding anything contained in the preceding subclause,<br />
the Company may :-<br />
(i)<br />
by a special resolution; or<br />
(ii) where no such special resolution is passed, if the<br />
votes cast (whether on a show of hands or on a poll, as the case may be) in favour<br />
of the proposal contained in the resolution moved in that general meeting<br />
(including the casting vote, if any, of the Chairman) by Members who, being<br />
entitled so to do, vote in person, or where proxies are allowed, by proxy exceed<br />
the votes, if any, cast against the proposal by Members so entitled and voting and<br />
the Central Government is satisfied, on an application made by the Board of<br />
Directors in this behalf, that the proposal is most beneficial to the Company offer<br />
further shares to any person or persons and such person or persons may or may<br />
not include the persons who at the date of the offer, are the holders of the equity<br />
shares of the Company.<br />
(c)<br />
Notwithstanding anything contained in sub-clause (a) above, but<br />
248
subject, however, to Section 81 (3) of the Act, the Company may increase its<br />
subscribed capital on exercise of an option attached to debentures issued or loans<br />
raised by the Company to convert such debentures or loans into shares, or to<br />
subscribe for shares in the Company.<br />
Shares under control of<br />
Directors.<br />
Power also to Company<br />
in General Meeting to<br />
issue shares.<br />
15. Subject to the provisions of these Articles and of the Act, the shares,<br />
forming part of any increased capital Company shall be under the control of the<br />
Directors, who may allot or otherwise dispose of the same to such persons in such<br />
proportion on such terms and conditions and at such times as the Directors think<br />
fit and subject to the sanction of the Company in General Meeting with full<br />
power, to give any person the option to call for or be allotted shares of any class<br />
of the Company either (subject to the provisions of Sections 78 and 79 of the Act)<br />
at a premium or at par or at a discount and such option being exercisable for such<br />
time and for such consideration as the Directors think fit. The Board shall cause to<br />
be filed the returns as to allotment provided for in Section 75 of the Act.<br />
16. In addition to and without derogating from the powers for the purpose<br />
conferred on the Board under Articles 14 and 15 the Company in general meeting<br />
may, subject to the provisions of Section 81 of the Act, determine that any shares<br />
(whether forming part of the original capital or of any increased capital of the<br />
Company) shall be offered to such person (whether a Member or not), in such<br />
proportion and on such terms and conditions and either (subject to compliance<br />
with the provisions of Section 78 and 79 of the Act) at a premium or at par or at a<br />
discount, as such general meeting shall determine and with full power to give any<br />
person (whether a member or not) the option to call for or be allotted shares of<br />
any class of the Company either (subject to compliance with the provisions of<br />
Section 78 and 79 of the Act) at a premium or at par or at a discount, such option<br />
being exercisable at such times and for such consideration as may be directed by<br />
such General Meeting or the Company in general meeting may make any other<br />
provision whatsoever for the issue, allotment or disposal of any shares.<br />
Acceptance of shares. 17. Any application signed by or on behalf of an applicant for shares in the<br />
Company, followed by an allotment of any share therein, shall be an acceptance<br />
of shares within the meaning of these Articles, and every person who thus or<br />
otherwise accepts any shares and whose name is on the Register shall for the<br />
purpose of these Articles, be a Member.<br />
Deposit and call etc. to be<br />
debt<br />
payable<br />
Immediately.<br />
18. The money (if any) which the Board shall, on the allotment of any shares<br />
being made by them, require or direct to be paid by way of deposit, call or<br />
otherwise, in respect of any shares allotted by them, shall immediately on the<br />
insertion of the name of the allottee in the Register of Members as the name of the<br />
holder of such shares, become a debt due to and recoverable by the Company<br />
from the allottee thereof, and shall be paid by him accordingly.<br />
Liability of Members 19. Every Member, or his heirs, executors, or administrators, shall pay to the<br />
Company the portion of the capital represented by his share or shares which may,<br />
for the time being, remain unpaid thereon, in such amounts, at such time or times,<br />
and in such manner as the Board shall, from time to time in accordance with the<br />
Company’s regulations, require or fix for the payment thereof.<br />
Share Certificates 20. (a) Every member or allottee of shares shall be entitled, without<br />
payment, to receive one certificate specifying the name of the person in whose<br />
favour it is issued, the shares to which it relates and the amount paid-up thereon.<br />
Such certificate shall be issued only in pursuance of a resolution passed by the<br />
Board and on surrender to the Company of its letter of allotment or its fractional<br />
coupons of requisite value, save in case of issues against letters of acceptance or<br />
of renunciation, or in cases of issues of bonus shares. Every such certificate shall<br />
be issued under the seal of the Company, which shall be affixed in the presence of<br />
two Directors or persons acting on behalf of the Directors under a duly registered<br />
power of attorney and the Secretary or some other person appointed by the Board<br />
for the purpose, and the two Directors or their attorney and the Secretary or other<br />
person shall sign the share certificate provided that if the composition of the<br />
Board permits of it, at least one of the aforesaid two Directors shall be a person<br />
other than a Managing or a whole-time Director. Particulars of every share<br />
certificate issued shall be entered in the Register of Members against the name of<br />
249
the person to whom it has been issued, indicating the date of issue. For any further<br />
certificate the Board shall be entitled, but shall not be bound to prescribe a charge<br />
not exceeding Rupee One. The Company shall comply with the provisions of<br />
Section 113 of the Act.<br />
(b) Any two or more joint allottees of a share shall, for the purpose<br />
of this Article, be treated as a single Member, and the certificate of any share,<br />
which may be subject of joint ownership may be delivered to any one of such<br />
joint holders on behalf of all of them.<br />
(c) A Director may sign a share certificate by affixing his signature<br />
thereon by means of any machine, equipment or other mechanical means, such as,<br />
engraving in metal or lithography, but not by means of a rubber stamp, provided<br />
that the Director shall be responsible for the safe custody of such machine,<br />
equipment or other material used for the purpose.<br />
Renewal of share<br />
certificates.<br />
21. (a) No certificate of any shares shall be issued either in exchange<br />
for those which are sub-divided or consolidated or in replacement of those which<br />
are defaced, torn or old, decrepit, worn out, or where the cases on the reverse for<br />
recording transfer have been duly utilized, unless the certificate in lieu of which it<br />
is issued is surrendered to the Company.<br />
(b) When a new share certificate has been issued in pursuance of<br />
clause (a) of this Article, it shall state on the face of it and against the stub or<br />
counterfoil to the effect that it is “Issued in lieu of shares certificate No. Subdivided/replaced/on<br />
consolidation of shares”.<br />
(c) If a share certificate is lost or destroyed, a new certificate in lieu<br />
thereof shall be issued only with the prior consent of the Board and on such terms,<br />
if any, as to evidence and indemnity and as to the payment of out-of-pocket<br />
expenses incurred by the Company in investigating evidence, as the Board thinks<br />
fit.<br />
(d) When a new share certificate has been issued in pursuance of<br />
clause (c) of this Articles, it shall state on the face of it and against the stub or<br />
counterfoil to the effect that it is “duplicate issued in lieu of which the new share<br />
certificate No…”. the word “Duplicate” shall be stamped or punched in bold<br />
letters across the face of the share certificate.<br />
(e) Where a new share certificate has been issued in pursuance of<br />
clause (a) or clause c) of this Article, particulars of every such share certificate<br />
shall be entered in a Register of Renewed and Duplicate Certificates indicating<br />
against the names of the persons to whom the certificate is issued, the number and<br />
date of issue of share certificate in lieu of which the new certificate is issued, and<br />
the necessary changes indicated in the Register of Members by suitable cross<br />
references in the “Remarks” column.<br />
(f) All blank forms to be used for issue of share certificates shall be<br />
printed and the printing shall be done only on the authority of a resolution of the<br />
Board. The blank forms shall be consecutively machine-numbered and the forms<br />
and the blocks, engravings, facsimiles and hues relating to the printing of such<br />
forms shall be kept in the custody of the Secretary or such other person as the<br />
Board may appoint for the purpose; and the Secretary or the other person<br />
aforesaid shall be responsible for rendering an account of these forms to the<br />
Board.<br />
(g) The Managing Director of the Company for the time being or, if<br />
the Company has no Managing Director, every Director of the Company shall be<br />
responsible for the maintenance, preservation and safe custody of all books and<br />
documents relating to the issue of share certificate except the blank forms of share<br />
certificates referred to in sub-Article (f).<br />
(h) All books referred to in sub-Article (g) shall be preserved in<br />
good order permanently.<br />
250
The first name of jointholders<br />
deemed sole<br />
holder.<br />
Company not bound to<br />
recognize any interest in<br />
shares other than that of<br />
registered holder.<br />
Discretion to refuse<br />
subdivision<br />
of<br />
consolidation of<br />
Certificate(s)<br />
Funds of the Company<br />
may not be applied in<br />
purchase of shares of the<br />
Company.<br />
22. If any share stands in the name of two or more persons, the person first<br />
named in the Register shall as regards receipt of dividends or bonus or service of<br />
notice and all any other matter connected with the company, except voting at<br />
meetings, and the transfer of the shares, be deemed the sole holder thereof but the<br />
joint-holders of a share shall be severally as well as jointly liable for the payment<br />
of all instalments and calls due in respect of such share and for all incidents<br />
thereof according to the Company’s regulations.<br />
23. Except as ordered by a Court of competent jurisdiction or as by law<br />
required, the Company shall not be bound to recognize any equitable, contingent,<br />
future or partial interest in any share, or (except only as is by these Articles<br />
otherwise expressly provided) any right in respect of share other than an absolute<br />
right thereto, in accordance with these Articles, in the person from time to time<br />
registered as the holder thereof; but the Board shall be at liberty at their sole<br />
discretion to register any share in the joint names of any two or more persons or<br />
the survivors of them.<br />
23.A. Notwithstanding anything contained in these Articles, the Board may in<br />
its absolute discretion, refuse applications for sub-division or consolidation of<br />
share Certificate(s), Debenture or Bond Certificate(s) into denominations of less<br />
than the marketable lot except when such sub-division or consolidation is required<br />
to be made to comply with a statutory provision or an order of a competent Court<br />
of Law, Provided that notwithstanding anything contained in these Articles, the<br />
Board of Directors shall, at its discretion, be entitled to charge and recover the<br />
stamp duty payable on Share Certificate(s) and Debenture Certificate(s) issued<br />
rising from splitting or consolidation or renewal or issue of duplicate<br />
Certificate(s), or transfer or transmission of shares or Debentures; and such stamp<br />
duty shall be paid by the Shareholder/Debentureholder prior to issue of the<br />
Certificate(s).<br />
24. None of the funds of the Company shall be applied in the purchase of<br />
any shares of the Company, and it shall not give any financial assistance for or in<br />
connection with the purchase or subscription of any shares in the Company or in<br />
its holding Company save as provided by Section 77 of the Act.<br />
Definitions 1) For the purpose of this Article :<br />
24.A #3. DEMATERIALISATION OF SECURITIES<br />
`Beneficial Owner’ means a person or persons whose name/s is/are<br />
recorded as such with a depository;<br />
`SEBI’ means the Securities & Exchange Board of India.<br />
`Depository’ means a Company formed and registered under the<br />
Companies Act, 1956 and which has been granted a certificate of<br />
registration to act as a depository under the Securities & Exchange Board<br />
of India Act, 1992;<br />
`Security’ means such security as may be specified by SEBI from time to<br />
time.<br />
`Depositories Act, 1996’ shall include any statutory modification or reenactment<br />
thereof.<br />
`Registered owner’ means a Depository whose name is entered as such in<br />
the records of the Company.<br />
Dematerialzation<br />
Securities<br />
of<br />
2) Notwithstanding anything contained in these Articles, the Company shall<br />
be entitled to dematerialize/rematerialized its securities and to offer<br />
securities in a dematerialized form pursuant to the Depositories Act,<br />
1996.<br />
Options for investors 3) Every person subscribing to securities offered by the Company shall have<br />
251
the option to receive security certificates or to hold the securities with a<br />
Depository. Such a person who is the beneficial owner of the securities<br />
can at any time opt out of a Depository, if permitted by the law, in respect<br />
of any security in a manner provided by the Depositories Act, and the<br />
Company shall, in the manner and within the time prescribed, issue to the<br />
beneficial owner the required Certificates of Securities.<br />
If a person opts to hold his security with a Depository, the Company shall<br />
intimate such Depository the details of allotment of the security and on<br />
receipt of the information, the Depository shall enter in its record the<br />
name of the allottee as the beneficial owner of the security.<br />
Securities in Depositories<br />
to be in fungible form<br />
Rights of Depositories<br />
and Beneficial owners<br />
4) All securities held by a Depository shall be dematerialized and be in<br />
fungible form. Nothing contained in Sections 153, 153A, 153B, 187B,<br />
187C and 372A of the Act shall apply to a Depository in respect of the<br />
securities held by it on behalf of the beneficial owners.<br />
5) (a) Notwithstanding anything to the contrary contained in the Act or<br />
these Articles, a Depository shall be deemed to be the registered<br />
owner for the purposes of effecting transfer of ownership of<br />
security on behalf of the beneficial owner.<br />
(b)<br />
(c)<br />
Save as otherwise provided in (a) above, the Depository as the<br />
registered owner of the securities shall not have any voting rights<br />
or any other rights in respect of the securities held by it.<br />
Every person holding securities of the Company and whose name<br />
is entered as the beneficial owner in the records of the Depository<br />
shall be deemed to be a member of the Company. The beneficial<br />
owner of securities shall be entitled to all the rights and benefits<br />
and be subject to all the liabilities in respect of his securities<br />
which are held by a Depository.<br />
Service of Documents 6) Notwithstanding anything contained in the Act or these Articles to the<br />
contrary, where securities are held in a Depository, the records of the<br />
beneficial ownership may be served by such Depository on the company<br />
by means of electronic mode or by delivery of floppies or discs.<br />
Transfer of Securities 7) (a) Nothing contained in Section 108 of the Act or these Articles<br />
shall apply to a transfer of securities effect by transferor and<br />
transferee both of whom are entered as beneficial owners in the<br />
records of a Depository.<br />
(b)<br />
In the case of transfer or transmission of shares or other<br />
marketable securities where the Company has not issued any<br />
certificates and where such shares or securities are being held in<br />
any electronic or fungible form in a Depository, the provisions of<br />
the Depositors Act, 1996 shall apply.<br />
Allotment of Securities<br />
dealt with in a Depositor)<br />
Certificate number and<br />
Distinctive numbers of<br />
Securities held in a<br />
Depository<br />
Register and Index of<br />
Beneficial Owners<br />
8) Notwithstanding anything in the Act or these Articles, where securities<br />
are dealt with by a Depository, the Company shall intimate the details of<br />
allotment of relevant securities thereof to the Depository immediately on<br />
allotment of such securities.<br />
9) Nothing contained in the Act or these Articles regarding the necessity of<br />
having certificate number/distinctive numbers for securities issued by the<br />
Company shall apply to securities held with a Depository.<br />
10) The Register and Index of beneficial owners maintained by a Depository<br />
under the Depositories Act, 1996 shall be deemed to be the Register and<br />
Index of Members and Security holders for the purposes of these<br />
Articles.<br />
UNDERWRITING AND BROKERAGE<br />
252
Commission may be paid. 25. Subject to the provisions of Section 76 of the Act the Company may at<br />
any time pay a commission to any person in consideration of his subscribing or<br />
agreeing to subscribe (whether absolutely or conditionally) for any shares or<br />
debentures in the Company, or procuring, or agreeing to procure subscriptions<br />
(whether absolute or conditional) for any shares or debentures in the Company,<br />
but so that the commission shall not exceed in the case of shares five per cent of<br />
the price at which the shares are issued and in the case of debentures two and a<br />
half cent of the price at which the debentures are issued. Such commission may be<br />
satisfied by payment of cash or by allotment of fully or partly paid shares or partly<br />
in one way and partly in the other.<br />
Brokerage 26. The Company may also, on any issue of share or debentures, pay such<br />
brokerage as may be lawful.<br />
INTEREST OUT OF CAPITAL<br />
Interest may be paid out<br />
of <strong>Capital</strong><br />
27. Where any shares are issued for the purpose of raising money to defray<br />
the expenses of the construction of any work or building, or the provision of any<br />
plant, which cannot be made profitable for a lengthy period, the Company may<br />
pay interest on so much of that share capital as is for the time being paid up, for<br />
the period, at the rate and subject to the conditions and restrictions provided by<br />
Section 208 of the Act and may charge the same to capital as part of the cost of<br />
construction of the work or building, or the provision of plant.<br />
CALLS<br />
Directors may make calls 28. The Board may, from time to time, subject to the terms on which any<br />
shares may have been issued and subject to the conditions of allotment, by a<br />
resolution passed at a meeting of the Board (and not by circular resolution) make<br />
such call as it thinks fit upon the Members in respect of all moneys unpaid on the<br />
shares held by them respectively and each Member shall pay the amount of every<br />
call so made on him to the person or persons and at the times and places<br />
appointed by the Board. A call may be made payable by instalments.<br />
Notice of call 29. Fourteen day’s notice in writing of any call shall be given by the<br />
Company specifying the time and place of payment, and the person or persons to<br />
whom such call shall be paid.<br />
Call to date from<br />
resolution<br />
Call may be revoked or<br />
postponed<br />
30. A call shall be deemed to have been made at the time when the resolution<br />
authorizing such call was passed at a meeting of the Board.<br />
31. A call may be revoked or postponed at the discretion of the Board.<br />
Liability of Joint-holders 32. The joint-holder of a share shall be jointly and se4verally liable to pay<br />
calls in respect thereof.<br />
Directors may extend<br />
time<br />
33. The Board may, from time to time, at its discretion, extend the time fixed<br />
for the payment of any call, and may extend such time as to all or any of the<br />
Members who, from residence at a distance or other cause, the Board may deem<br />
fairly entitled to such extention but no Member shall be entitled to such<br />
extensions save as a matter of grace and favour.<br />
Calls to carry interest 34. If any Member fails to pay any call due from him on the day appointed<br />
for payment thereof, or any such extention thereof as aforesaid he shall be liable<br />
to pay interest on the same from the day appointed for the payment thereof to the<br />
time of actual payment at such rate as shall from time to time be fixed by the<br />
Board not exceeding 9 per cent per annum but nothing in this Article shall render<br />
it obligatory for the Board to demand or recover any interest from any such<br />
member.<br />
Sums deemed to be calls. 35. Any sum, which by the terms of issue of a share becomes payable on<br />
allotment or at any fixed date, whether on account of the nominal value of the<br />
share or by way of premium, shall for the purpose of these Article be deemed to<br />
253
e a call duly made and payable on the date on which by the terms of issue the<br />
same becomes payable, and in case of non-payment all the relevant provisions of<br />
th3ese Articles as to payment of interest and expense, forfeiture or otherwise shall<br />
apply as if such sum had become payable by virtue of a call duly made and<br />
notified.<br />
Proof on trial of suit for<br />
money due on shares.<br />
Partial payment not to<br />
preclude forfeiture<br />
Payment in anticipation<br />
of calls may carry<br />
interest.<br />
36. On the trial or hearing of any action or suit brought by the Company<br />
against any Member or his representative for the recovery of any money claimed<br />
to be due to the Company in respect of his shares, it shall be sufficient to prove<br />
that the name of the Member in respect of whose shares the is sought to be<br />
recovered, appears entered on the Register of Members as the holder at or<br />
subsequent to the date which the money sought to be recovered is alleged to have<br />
become due on the shares in respect of which such money is sought to be<br />
recovered; that the resolution making the call is duly recorded in the Minute<br />
Book; and that notice of such call was duly given to the member or his<br />
representatives, so sued in pursuance of these Article; and it shall not be necessary<br />
to prove the appointment of the Directors who made such call, nor that a quorum<br />
of Directors was present at the Board at which any call was made, nor that the<br />
meeting at which any call was made was duly convened or constituted nor any<br />
other matters whatsoever, but the proof of the matters aforesaid shall be<br />
conclusive evidence of the debt.<br />
37. Neither the receipt by the Company of a portion of any money which<br />
shall from time to time be due from any Member to the Company in respect of his<br />
shares, either by way of principal of interest, nor any indulgence granted by the<br />
Company in respect of the payment of any such money, shall preclude the<br />
Company from thereafter proceeding to enforce a forfeiture of such shares as<br />
hereinafter provided.<br />
38. (a) The Board may, if it thinks fit, agree to and receive from any<br />
Member willing to advance the same, all or any part of the amounts of his<br />
respective shares beyond the sums, actually called up and upon the moneys so<br />
paid in advance, or upon so much thereof, from time to time, and at any time<br />
thereafter as exceeds the amount of the calls then made upon and due in respect of<br />
the shares on account of which such advances are made the Board may pay or<br />
allow interest, at such rate as the Member paying sum in advance and the Board<br />
agree upon. The Board may agree to repay at any time any amount so advanced or<br />
may at any time repay the same upon giving to the member three month’s notice<br />
in writing. Provided that mone4ys paid in advance of calls on any shares may<br />
carry interest but shall not confer a right to dividend or to participate in profits.<br />
(b) No Member paying any such sum in advance shall be entitled to<br />
voting rights in respect of the moneys so paid by him until the same would but for<br />
such payment become presently payable.<br />
Company have lien<br />
shares<br />
As to enforcing lien by<br />
sale.<br />
39. The Company shall have a first and paramount lien upon all the shares<br />
(other than fully paid up shares) registered in the name of each Member (whether<br />
solely or jointly with others) and upon the proceeds of sale thereof, for all moneys<br />
(whether presently payable or not) called or payable at a fixed time in respect of<br />
such shares, and no equitable interest in any share shall be created except upon the<br />
footing and upon the condition that Article 23 hereof is to have full effect. And<br />
such lien shall extend to all dividends from time to time declared in respect of<br />
such shares. Unless otherwise agreed the registration of a transfer of shares shall<br />
operate as a waiver of the Company’s lien, if any, on such shares.<br />
40. For the purpose of enforcing such lien, the Board may sell the shares<br />
subject thereto in such manner as they shall think fit, and for that purpose may<br />
cause to be issued duplicate certificate in respect of such shares and may authorise<br />
one of their number to execute a transfer thereof on behalf of and in the name of<br />
such Member. No sale shall be made until such period as aforesaid shall have<br />
arrived, and until notice in writing of the intention to sell shall have been served<br />
on such member or his representatives and default shall have been made by him<br />
or them in the payment, fulfillment, or discharge of such debts, liabilities or<br />
engagements for fourteen days after such notice.<br />
254
Application of proceeds<br />
of sale<br />
41. The net proceeds of any such sale shall be received by the Company and<br />
applied in or towards the payment of such part of the amount in respect of which<br />
the lien exists as is presently payable and the residue, if any, shall (subject to a<br />
like lien for sums not presently payable as existed upon the shares before the sale)<br />
be paid to the persons entitled to the shares at the date of the sale.<br />
FORFEITURE OF SHRES<br />
If money payable on<br />
shares not paid notice to<br />
be given to Member<br />
42. If any Member falls to pay any call or instalment of a call on or before<br />
the day appointed for the payment of the same or any such extension thereof as<br />
aforesaid, the Board may at any time thereafter, during such time as the call or<br />
instalment remains unpaid give notice to him requiring him to pay the same<br />
together with any interest that may have accrued and all expenses that may have<br />
been incurred by the Company by reason of such non-payment.<br />
Forms of notice 43. The notice shall name a day (not being less than fourte4en days from the<br />
date of the notice) and the place or places on and at which such call or instalment<br />
and such interest thereon at such rate not exceeding 9 per cent per annum as the<br />
Directors shall determine from the day on which such call or instalment ought to<br />
have been paid and expenses as aforesaid are to be paid. The notice shall also<br />
state that, in the event of non-payment at or before the time and at the place<br />
appointed, the shares in respect of which the call was made or instalment is<br />
payable, will be liable to be forfeited.<br />
In default of payment,<br />
shares to be forfeited.<br />
Notice of forfeiture to a<br />
Member<br />
Forfeited share to be<br />
property of the Company<br />
and may be sold, etc.<br />
Member still liable to pay<br />
money owing at time of<br />
forfeiture and interest.<br />
44. If the requirements of any such notice as aforesaid shall not be complied<br />
with every or any shares in respect of which such notice has been given, may at<br />
any time thereafter before payment of all calls or instalmetns, interest and<br />
expenses due in respect thereof, be forfeited by a resolution of the Board to the<br />
effect. Such forfeiture shall include all dividends declared or any other moneys<br />
payable in respect of the forfeited shares and not actually paid before the<br />
forfeiture.<br />
45. When any shares shall have been so forfeited notice of the forfeiture shall<br />
be given to the Member in whose name it stood immediately prior to the<br />
forfeiture, and an entry of the forfeiture, with the date thereof, shall forthwith be<br />
made in the Register of Members, but no forfeiture shall be in any manner<br />
invalidated by any omission or neglected to give such notice or to make any such<br />
entry as aforesaid.<br />
46. Any share so forfeited shall be deemed to be the property of the<br />
Company, and may be sold, re-allotted, or otherwise disposed of, either to the<br />
original holder thereof or to any other person, upon such terms and in such<br />
manner as the Board shall think fit.<br />
47. Any Member whose shares have been forfeited shall notwithstanding the<br />
forfeiture, be liable to pay and shall forthwith pay to the Company, on demand all<br />
calls, instalments, interest, and expenses owing upon or in respect of such shares<br />
at the time of the forfeiture, together with interest thereon from time to time of the<br />
forfeiture until payment, at such rate not exceeding 9 per cent per annum as the<br />
Board may determine and the Board may enforce the payment thereof, if it thinks<br />
fit.<br />
Effect of Forfeiture 48. the forfeiture of a share shall involve extinction, at the time of the<br />
forfeiture, of all interest in and all claims and demands against the Company, in<br />
respect of the share and all other rights incidental to the share, except only such<br />
those rights as by these Articles are expressly saved.<br />
Evidence of Forfeiture 49. A declaration in writing that the declarant is a Director or Secretary of the<br />
Company and that a share in the Company has been duly forfeited in accordance<br />
with these Articles on a date stated in the declaration, shall be conclusive<br />
evidence of the facts therein stated as against all persons claiming to be entitled to<br />
the shares. Such declaration and the receipt of the Company for the consideration,<br />
if any, given for the share on the sale or disposal thereof shall constitute a good<br />
title to such shares and the person to whom the shares are sold shall be registered<br />
as the holder of such shares and shall not be bound to see to the application of the<br />
255
purchase money, nor shall his title to such shares be affected by any irregularity or<br />
invalidity in the proceedings in reference to such forfeiture, sale or disposition.<br />
Validity of sale under<br />
Article 40 and 46.<br />
Cancellation of share<br />
certificates in respect of<br />
forfeited shares<br />
Power to annual<br />
forfeiture<br />
50. Upon any sale after forfeiture or for enforcing a lien in purported exercise<br />
of the powers hereinbefore given, the Board may appoint some person to execute<br />
an instrument of transfer of the shares sold and cause the purchaser’s name to be<br />
entered in the Register in respect of the shares sold, and the purchaser shall not be<br />
bound to see to the regularity of the proceedings, or to the application of the<br />
purchase money, and after his name has been entered in the Register in respect of<br />
such shares, the validity of the sale shall not be impeached by any person and the<br />
remedy of any person aggrieved by the sale shall be in damages only and against<br />
the Company exclusively.<br />
51. Upon any sale, re-allotment or other disposal under the provisions of the<br />
preceding Articles, the certificate or certificates originally issued in respect of the<br />
relative shares shall (unless the same shall on demand by the Company have been<br />
previously surrendered to it by the defaulting member) stand cancelled and<br />
become null and void and of no effect, and the Directors shall be entitled to issue<br />
a duplicate certificate or certificates in respect of the said shares to the person or<br />
persons entitled thereof.<br />
52. The Board may at any time before any share so forfeited shall have been<br />
sold, re-allotted or otherwise disposed of, annual the forfeiture thereof upon such<br />
conditions as it thinks fit.<br />
TRANSFER AND TRANSMISSION OF SHARES<br />
Register of transfers 53. The Company shall keep a “Register of Transfers” and therein shall be<br />
fairly and distinctly entered particulars of every transfer or transmission of any<br />
share.<br />
Form of transfer 54. Every instrument of transfer of shares shall be in writing in such form as<br />
shall from time to time be permissible to used under the relevant provisions of the<br />
Act in that behalf. The Directors may from time to time alter or vary the form of<br />
such transfer but so as to comply with the provisions of the Act in that behalf.<br />
Transfer form to be<br />
completed and presented<br />
to the Company<br />
Transfer books when<br />
closed.<br />
Directors may refuse to<br />
register transfer(s)<br />
55. The instrument of Transfer duly stamped and executed by the Transferor<br />
and the Transferee shall be delivere4d to the Company in accordance with the<br />
provisions of the Act. The Instrument of Transfer shall be accompanied by such<br />
evidence as the Board may require to prove the title of Transferor and his right to<br />
transfer the shares and every registered Instrument of Transfer shall remain in<br />
custody of the Company until destroyed by order of the Board. The Transferor<br />
shall be deemed to be the holder of such shares until the name of the Transfere4e<br />
shall have been entered in the Register of members in respect thereof. Before the<br />
registration of a transfer the certificate or certificates of the shares must be<br />
delivered to the Company.<br />
56. The Board shall have power on giving not less than seven days previous<br />
notice by advertisement in a newspaper circulating in the city, town or village in<br />
which the Registered Office of the Company is situated to close the transfer<br />
books, the Register of Members and/or Register of Debentureholders at such time<br />
or times and for such periods, not exceeding thirty days at a time and not<br />
exceeding the aggregate forty-five days in each year as to it may seem expedient.<br />
57. Subject to the provisions of Section 111 of the Act and Section 22A of<br />
Securities Contracts (Regulation) Act, 1956, the Board may refuse to register any<br />
transfer of, or the transmission by operation of law of the right to, any shares or<br />
interest of a Member in the Company Provided however that the registration of a<br />
share shall not be refused on the ground of the transferor being either alone or<br />
jointly with any other person or persons indebted to the Company on any account<br />
whatsoever. Provided further that in the event of refusal to register any such<br />
transfer of, or the transmission of the right to, any shares or interest of the member<br />
in the Company, the Company shall, within two months from the date on which<br />
the instrument of transfer, or the intimation of such transmission, as the case may<br />
be, was delivered to the Company, send notice of such refusal to the transferee<br />
256
and transferor or the person giving intimation of such transmission, as the case<br />
may be, giving reasons for such refusal.<br />
Notice of application<br />
when to be given<br />
Death of one or more<br />
joint holder of shares<br />
Title to Shares of<br />
deceased Member<br />
58. When, in the case of partly paid shares, an application for registration is<br />
made by the transferor, the Company shall give notice of the application to the<br />
transferee in accordance with the provisions of Section 110 of the Act.<br />
59. In the case of the death of any one of more of the persons named in the<br />
Register of Members as the joint holders of any share, the survivor, or the<br />
survivors shall be the only persons recognized by the Company as having any title<br />
to or interest in such share, but nothing herein contained shall be taken to release<br />
the estate of a deceased joint holder from any liability on shares held by him<br />
jointly with any other person.<br />
60. The executors or administrators or holder of a Succession Certificate or<br />
the legal representative of a deceased Member (not being one of two or more<br />
joint-holders) shall be the only persons recognized by the Company as having any<br />
title to the shares registered in the name of such Member, and the Company shall<br />
not be bound to recognize such executors or administrators or holders of a<br />
Succession Certificate or the legal representatives unless such executors or<br />
administrators or legal representatives shall have first obtained Probate or Letters<br />
of Administration or Succession Certificate, as the case may be, from a duly<br />
constituted Court in the Union of India; provided that in any case where the Board<br />
in its absolute discretion thinks fit, the Board may dispense with the production of<br />
Probate or Letters of Administration or Succession Certificate, upon such terms as<br />
to indemnity or otherwise as the Board in its absolute discretion may think<br />
necessary and under Article 63 register the name of any person who claims to be<br />
absolutely entitled to the shares standing in the name of a deceased member, as a<br />
Member.<br />
No transfer to infant, etc. 61. No share shall in any circumstances be transferred to any infant,<br />
insolvent or person of unsold mind.<br />
Compliance with the<br />
Estate Duty Act, 1953.<br />
Registration of persons<br />
entitled to share<br />
otherwise than by<br />
transfer.<br />
Persons entitled may<br />
receive dividend without<br />
being registered as<br />
62. If any Member of the Company dies, and the Company through any of its<br />
principal offices within the meaning of the Estate Duty Act, 1953, has knowledge<br />
of the death, it shall not be lawful of the Company to register the transfer of any<br />
shares standing in the name of the deceased Member unless the Company is<br />
satisfied that the transferee has acquired such shares for valuable consideration or<br />
there is produced to it a certificate from the Controller, Deputy Controller or<br />
Assistant Controller or Estate Duty that either the Estate Duty in respect thereof<br />
has been paid or will be paid or none is due as the case may be. Where the<br />
Company has come to know through any of its principal officers of the death of<br />
any Member, the Company shall, within three months of the receipt of such<br />
knowledge, furnish to the Assistant Controller or the Deputy Controller of Estate<br />
Duty who is exercising the functions of the Income-Tax Officer under the<br />
Income-Tax Act in relation to the Company, such particulars as may be prescribed<br />
by Estate Duty Rules, 1953.<br />
63. Subject to the provisions of the Act Articles 59 and 60 any person<br />
becoming entitled to shares in consequence of the death, lunacy, bankruptcy or<br />
insolvency or any Member, or by any lawful means other than by a transfer in<br />
accordance with these Articles, may, with the consent of the Board (which it shall<br />
not be under any obligation to give), upon producing such evidence that he<br />
sustains the character in respect of which he proposes to ct under this Article or of<br />
such title as the Board thinks sufficient, either be registered himself as the holder<br />
of the shares or elect to have some person nominated by him and approved by the<br />
Board registered s such holder; provided nevertheless, that if such person shall<br />
elect to have his nominee registered, he shall testify the election by executing in<br />
favour of his nominee an instrument of transfer in accordance with the provisions<br />
herein contained and until the does so, he shall not be freed from any liability in<br />
respect of the shares.<br />
64. A person entitled to a share by transmission shall, subject to the right of<br />
the Directors to retain such dividends or money s hereinafter provided, be entitled<br />
to receive and may give a discharge, for, any dividends or other moneys payable<br />
257
Members.<br />
Fees on transfer or<br />
transmission<br />
Company not liable for<br />
disregard of a notice<br />
prohibiting registration<br />
of a transfer.<br />
in respect of the shares.<br />
65. No fee shall be payable to the company, in respect of the transfer or<br />
transmission of shares.<br />
66. The Company shall incur no liability or responsibility whatsoever in<br />
consequence of its registering or giving effect to any transfer of shares made or<br />
purported to be made by any apparent legal owner thereof (as shown or appearing<br />
in the Register of Members) to the prejudice of persons having or claiming any<br />
equitable right, title or interest to or in the said shares, notwithstanding that the<br />
Company may have had notice of such equitable right, title or interest or notice<br />
prohibiting registration of such transfer and may have entered such notice or<br />
referred thereto, in any book of the Company, and the Company shall not be<br />
bound or required to regard or attend or give effect to any notice which may be<br />
given to it of any equitable right, title or interest, or be under any liability<br />
whatsoever for refusing or neglecting so to do, though it may have been entered or<br />
referred to in some book of the Company; but the Company shall nevertheless be<br />
at liberty to regard and attend to any such notice and give effect thereto if the<br />
Board shall so think fit.<br />
Transfer of Debentures 67. The provisions of these Articles shall mutatis mutandis apply to the<br />
transfer or transmission by operation of law of debentures of the Company.<br />
Nomination 67(A) (1) Every holder of share(s) in and/or debenture(s) of the Company, so<br />
entitled under the Act and Rules framed thereunder, may, at<br />
anytime, nominate, in the manner prescribed under the ct, a person<br />
to whom his share(s) in and/or debenture(s) of the Company shall<br />
vest in the event of his death.<br />
(2) Where the share(s) in and/or debenture(s) of the Company are held<br />
by more than one person jointly, the jointholders, so entitled under<br />
the Act and the Rules framed thereunder, may, together nominate,<br />
in the manner prescribed under the Act, a person to whom all the<br />
rights in the share(s) and/or debenture(s) of the Company, as the<br />
case may be, shall vest in the event of death of all the joint holders.<br />
(3) Notwithstanding anything contained in any other law for the time<br />
being in force or in these Articles or in any disposition, whether<br />
testamentary or otherwise, in respect of the share(s) in and/or<br />
debenture(s) of the Company, where a nomination is made in the<br />
manner prescribed under the Act, purports to confer on any person<br />
the right to vest the share(s) in and/or debenture(s) of the Company,<br />
the nominee shall, on the death of the shareholder and/or<br />
debentureholder concerned or on the death of the jointholders as the<br />
case may be, become entitled to all the rights in relation to such<br />
share(s) and/or debenture(s), to the exclusion of all other persons,<br />
unless the nomination is varied or cancelled in the manner<br />
prescribed under the Act.<br />
(4) Where a nominee is a minor, the holder of the share(s) in and/or<br />
debenture(s) of the Company can make a nomination in the manner<br />
prescribed under the Act, to appoint any person to become entitled<br />
to the share(s) in and/or debenture(s) of the Company, in the event<br />
of his death, during the minority.<br />
Transmission in case of<br />
nomination<br />
67(B) (1) Notwithstanding anything contained in these Articles, any person<br />
who becomes a nominee by virtue of the provisions of Article<br />
67(A), upon the production of such evidence as may be required by<br />
the Board and subject as hereinafter provided, elect, either -<br />
(a)<br />
(b)<br />
to be registered himself as holder of the share(s) and/or<br />
debenture(s), as the case may be; or<br />
to make such transfer of the share(s and/or debenture(s), as<br />
the case may be, as the deceased shareholder and/or<br />
258
debentureholder concerned or deceased jointholder, as the<br />
case may be, could have made.<br />
(2) If the person being a nominee, so becoming entitled, elects himself<br />
to be registered s holder of the share(s) and/or debenture(s), as the<br />
case may be, he shall deliver or send to the Company, a notice in<br />
writing duly signed by him stating the nominee concerned so elects<br />
and such notice shall be accompanied with the death certificate(s)<br />
of the deceased shareholder/debentureholder/jointholders, as the<br />
case may be.<br />
(3) All the limitations, restrictions and provisions of these Articles,<br />
relating to the right to transfer and the registration of transfers of<br />
share(s) and/or debenture(s) shall be applicable to any such notice<br />
or transfer as aforesaid as if the death of the shareholder/debentureholder<br />
had not occurred and the notice or transfer were signed by<br />
that shareholder and/or debentureholder or jointholders, as the case<br />
may be.<br />
(4) A person, being a nominee, becoming entitled to the share(s) and/or<br />
debenture(s) by reason of the death of the holder shall be entitled to<br />
the same dividends and other advantages to which he would be<br />
entitled if he were the registered holder of the share(s) and/or<br />
debenture(s), except that he shall not, before being registered a<br />
member in respect of his share(s) or debenture(s), be entitled in<br />
respect of it to exercise any right conferred by membership in<br />
relation to meetings of the Company.<br />
Provided that the Board may, at any time, give notice requiring any<br />
such person to elect either to be registered himself or to transfer the<br />
share(s) and/or debenture(s); and if the notice is not compiled with,<br />
within ninety days, the Board may thereafter withhold payments of<br />
all dividends, bonuses or other moneys payable or rights accruing in<br />
respect of the share(s) and/or debenture(s) until the requirements of<br />
the notice have been complied with.<br />
COPIES OF MEMORANDUM AND ARTICLES<br />
TO BE SENT TO MEMBERS<br />
Copies of Memorandum<br />
& Articles of Association<br />
to be sent by the<br />
Company.<br />
68. Copies of the Memorandum and Articles of Association of the Company<br />
and other documents referred to in Section 39 of the Act, shall be sent by the<br />
Company to every Member at his request within seven days of the request on<br />
payment of the sum of Rupee one for each copy.<br />
BORROWING POWER<br />
Power to borrow. 69. Subject to the provisions of Section 292 and 293 of the Act and the4se<br />
Articles, the Board may, from time to time at its discretion, accept deposits from<br />
Members (either in advance of calls or otherwise), and from other persons and<br />
generally borrow or raise or secure the payment of any sum or sums of money for<br />
the purposes of the Company. Provided, however that where the moneys to be<br />
borrowed together with the moneys already borrowed (apart from temporary loans<br />
obtained from the Company’s, Bankers in the ordinary course of business),<br />
exceed the aggregate of the paid-up capital of the Company and its free reserves,<br />
(not being reserves set apart for any specific purpose) the Board shall not borrow<br />
such moneys without the consent of the Company in General Meeting.<br />
Payment or repayment of<br />
moneys borrowed.<br />
70. The payment or repayment of moneys borrowed as aforesaid may be<br />
secured in such manner and upon such terms and conditions in all respects as the<br />
Board may think fit, and, in particular, by a resolution passed at a meeting of the<br />
Board (and not by circular resolution), by the issue of debentures or debenture<br />
stock of the Company, charged upon all or any part of the property of the<br />
Company (both present and future) including its uncalled capital for the time<br />
being; and debentures, debenture-stock and other securities may be made<br />
assignable free from any equities between the Company and the person to whom<br />
259
the same may be issued.<br />
Terms of issue of<br />
Debentures<br />
Register of Mortgages<br />
etc. of be kept.<br />
Register and Index of<br />
Debenture-holders<br />
71. Any debentures, debenture-stock or other securities may be issued at a<br />
discount, premium or otherwise and may be issued on condition that they shall be<br />
convertible into shares of any denomination, and with any privileges and<br />
conditions as to redemption, surrender, drawing, allotment of shares and attending<br />
(but not voting) at general meeting, appointment of Directors and otherwise.<br />
Debenture with the right to conversion into or allotment of shares shall be issued<br />
only with the consent of the Company in General Meeting.<br />
72. The Board shall cause a proper Register to be kept in accordance with the<br />
provisions of Section 143 of the Act of all mortgages, debentures and charges<br />
specifically affecting the property of the Company; and shall cause the<br />
requirements of Section 118, 125 and 127 to 144 (both inclusive), of the Act in<br />
that behalf to be duly complied with by the Board.<br />
73. The Company, shall, it at any time it issued debentures, keep a Register<br />
and Index of Debenture-holders in accordance with Section 152 of the Act. The<br />
Company shall have the power to keep in any State or Country outside India a<br />
Branch Register of Debenture-holders resident in that State or Country.<br />
CONVERSION OF SHRES INTO STOCK<br />
AND RECONVERSION<br />
Shares may be converted<br />
into stock<br />
74. The Company in General Meeting may convert and any paid up shares<br />
into stock and when any shares shall have been converted into stock, the several<br />
holders of such stock may thenceforth transfer their respective interest therein or<br />
any part of such interests, in the same manner and subject to which shares from<br />
which the stock arise might have been transferred, if no such conversion had<br />
taken place or as near thereto as circumstances will admit. The Company may at<br />
any time reconvert any stock into paid-up shares of any denomination.<br />
Rights of Stock-holder. 75. The holders of stock shall according to the amount of stock held by them,<br />
have the same rights, privileges and advantages as regards dividends, voting at<br />
meetings of the Company, and other matters, as if they held the shares from which<br />
the stock arose; but no such privileges or advantages, (except participation in the<br />
dividends and profits of the Company and in the winding-up), shall be conferred<br />
by an amount of stock which would not, if existing in shares, have conferred that<br />
privilege or advantage.<br />
MEETINGS OF MEMBERS<br />
Annual General Meeting.<br />
Annual Summary<br />
76. The Company shall in each year hold a General Meeting as its Annual<br />
General Meeting in addition to any other meetings in that year. All General<br />
Meetings other than Annual General Meetings shall be called Extraordinary<br />
General Meetings. The Annual General Meeting shall be held within six months<br />
after expiry of each financial year, provided that not more than fifteen months<br />
shall elapse between the date of one Annual General Meeting and that of the next.<br />
Nothing contained in the foregoing provisions shall be taken as affecting the right<br />
conferred upon the Register under the provisions of Section 166(1) of the Act to<br />
extend the time within which any Annual General Meeting may be held. Every<br />
Annual General Meeting shall be called for at a time, during business hours, on a<br />
day that is not a public holiday, and shall be held at the Registered Office of the<br />
Company or at some other place within the city in which the Registered Office of<br />
the Company is situate, as the Board may determine and the notices calling the<br />
Meeting shall specify it as the Annual General Meeting. The Company may in<br />
any one Annual General Meeting fix the time for its subsequent Annual General<br />
Meetings. Every member of the Company shall be entitled to attend the Annual<br />
General Meeting either in person or by proxy and the Auditor of the Company<br />
shall have the right to attend and to be heard at any General Meeting which he<br />
attends on any part of the business which concerns him as Auditor. At every<br />
Annual General Meeting of the Company there shall be laid on the table, the<br />
Director’s Report and Audited Statement of Accounts, Auditor’s Report (if not<br />
already incorporated in the Audited Statement of Accounts) the Proxy Register<br />
with proxies and the Register of Director’s Shareholdings which latter Register<br />
260
Extraordinary<br />
Meeting<br />
General<br />
shall remain open and accessible during the continuance of the Meeting. The<br />
Board shall cause to be prepared the Annual List of Members, Summary of the<br />
Share <strong>Capital</strong>, Balance Sheet and Profit and Loss Account and forward the same<br />
to the Registrar, in accordance with Sections 159, 161 and 220 of the Act.<br />
77. The Board may, whenever it think fit, call an Exraordinary General<br />
Meetings and it shall do so upon a requisition in writing by any Member or<br />
Members holding aggregate not less than one-tenth of such of the paid-up capital<br />
as at that date carries he right of voting in regard to the matter in respect of which<br />
the requisition has been made.<br />
Requisition of Members<br />
to state object of meeting<br />
Meeting called by<br />
requisitionists.<br />
Twenty-one day’s notice<br />
of meeting to be given.<br />
Omission to give notice<br />
not to invalidate a<br />
resolution passed.<br />
Notice of business to be<br />
given.<br />
78. Any valid requisition so made by Members must state the object or<br />
objects of the Meeting proposed to be called, and must be signed by the<br />
requisitionists and be deposited at the Office provided that such requisition may<br />
consist of several documents in like from each signed by one or more requisitions.<br />
Upon the receipt of any such requisition, the Board shall forthwith call an<br />
extraordinary general meeting, and if they do not proceed within 21 days from the<br />
date of requisition being deposited at the office to cause a meeting to be called on<br />
a day not later than forty-five days from the date of deposit of the requisition, the<br />
requisitionists, or such of their number as represent either a majority in value of<br />
the paid-up share capital held by all of them or not less than one-tenth of such of<br />
the paid-up share capital of the Company as is referred to in Section 169(4) of the<br />
Act, whichever is less, may themselves call the Meeting, but in either case any<br />
Meeting so called be held within three months from he date of the delivery of the<br />
requisition as aforesaid.<br />
79. Any Meeting called under the foregoing Articles by the requisitionists,<br />
shall be called in the same manner, as nearly as possible, as that in which a<br />
Meeting is to be called by the Board.<br />
80. Twenty-one day’s notice at the least of every General meeting, Annual or<br />
Extraordinary, and by whomsoever called specifying the day, place and hour of<br />
Meeting, and the general nature of the business to be transacted thereat, shall be<br />
given in the manner hereinafter provided, to such persons as are under these<br />
Articles entitled to receive notice from the Company. Provided that in the case of<br />
an Annual General Meeting with the consent in writing of all the Members<br />
entitled to vote threat and in case of any other Meeting, with the consent of<br />
Members holding not less than 95 per cent of such part of the paid-up share<br />
capital of the Company as gives a right to vote at the meeting, a Meeting may be<br />
convened by a shorter notice. In the case of an Annual General Meeting, if any<br />
business other than (i) the consideration of the accounts, Balance Sheet and<br />
Report of the Board of Directors and Auditors, (ii) the declaration of dividend,<br />
(iii) the appointment of Directors in place of those retiring, (iv) the appointment<br />
of, and fixing of the remuneration of the Auditors, is to be transacted, and in the<br />
case of any other Meeting in any event, there shall be annexed to the notice of the<br />
Meeting a statement setting out all material facts concerning each such item of<br />
business, including in particular the nature of the concern or interest if any therein<br />
of every Director and the Manager (if any). Where any such item of business<br />
relates to or affects any other company, the extent of shareholding interest in that<br />
other company of every Director, and the Manager, (if any), of the Company shall<br />
also be set out in the statement if the extent of such shareholding interest is not<br />
less than 20 per cent of the paid-up share capital of that other company. Where<br />
any item of business consists of the according of approval to any document by the<br />
Meeting, the time and place where the document can be inspected shall be<br />
specified in the statement aforesaid.<br />
81. The accidental omission to give any such notice as aforesaid to any of the<br />
Members, or the non-receipt thereof, shall not invalidate any resolution passed at<br />
any such meeting.<br />
82. No General Meeting Annual or Extraordinary, shall be competent to enter<br />
into, discuss or transact any business which has not been mentioned in the notice<br />
or notices by which it was convened.<br />
Quorum at General 83. Five Members present in person shall be a quorum for a General<br />
261
Meeting.<br />
If quorum not present,<br />
Meeting to be dissolved<br />
or adjourned<br />
Chairman of General<br />
Meeting<br />
Business confined to<br />
election of Chairman<br />
whilst chair is vacant<br />
Meeting. A body corporate being a member shall be deemed to be personally<br />
present if it is represented in accordance with Section 187 of the Act.<br />
84. If, at the expiration of half an hour from the time appointed for holding a<br />
Meeting of the Company, a quorum shall not be present, the Meeting, convened<br />
by or upon the requisition of Members, shall stand dissolved, but in any other<br />
case, the Meeting shall stand adjourned to the same day in the next week or, if<br />
that is a public holiday until the next succeeding day which is not a public holiday<br />
at the same time and place or to such other day and at such other time and place<br />
within the city, town or village in which the Registered Office of the Company is<br />
situate, as the Board may determine, and if at such adjourned Meeting a quorum is<br />
not present at the expiration of half an hour from the time appointed for holding<br />
the Meeting, the members present shall be a quorum, and may transact the<br />
business for which the Meeting was called. It shall not be necessary to give any<br />
notice of an adjournment or of the business to be transacted at an adjourned<br />
meeting.<br />
85. The Chairman (if any), of the Board shall be entitled to take the chair at<br />
every General Meeting, whether Annual or Extra-ordinary. If there be no such<br />
Chairman of the Board, or if at any Meeting he shall not be present within fifteen<br />
minutes of the time appointed for holding such meeting or if he shall be unable or<br />
unwilling to take the chair then the Vice-Chairman (if any) of the Board shall be<br />
entitled to take the chair at such General Meeting. If there be no such Vice-<br />
Chairman of the Board or if at any Meeting he shall not be present within fifteen<br />
minutes of the time appointed for holding such meeting or if he shall be unable or<br />
unwilling to take the chair, then the Members present shall elect another director<br />
as Chairman, and if no Director be present shall elect another Director as<br />
Chairman, and if no Director be present or if all the Directors present decline to<br />
take the Chair, then the Members present shall elect one of their number to be the<br />
Chairman.<br />
86. No business shall be discussed at any General meeting except the<br />
election of Chairman, while the Chair is vacant.<br />
Chairman with consent<br />
may adjourn Meeting.<br />
87. The Chairman with the consent of the meeting may adjourn any meeting<br />
from time to time and from place to place within the City, Town or Village in<br />
which the Registered Office of the Company is situate, but no business shall be<br />
transacted at any adjourned meeting other than the business left unfinished at the<br />
Meeting which was adjourned.<br />
Questions of General<br />
Meetings how decided.<br />
88. At any General Meeting a resolution put to the vote of the Meeting shall<br />
be decided on a show of hands, unless a poll is (before or on the declaration of the<br />
result of the show of hands) demanded as provided in Article 88-A hereof. A<br />
declaration by the Chairman that a resolution has on a show of hands, been carried<br />
unanimously, or by particular majority or lost, and an entry to that effect in the<br />
Minute Book of the Company shall be conclusive evidence of the fact, without<br />
proof of proportion of the votes recorded in favour or against that resolution.<br />
Demand for Poll 88-A. Before or on the declaration of the result of the voting on any resolution<br />
on a show of hands, a poll may be ordered to be taken by the Chairman of the<br />
Meeting of his own motion and shall be ordered to be taken by him on a demand<br />
in that behalf by any Member or Members present in person or by proxy and<br />
holding shares in Company which confer a power to vote on the resolution not<br />
being less than one-tenth of the total voting power in respect of the resolution or<br />
on which an aggregate sum of not less than fifty thousand rupees has been paidup.<br />
The demand for a poll may be withdrawn at any time by the person or persons<br />
who made the demand.<br />
Chairman’s casting vote. 89. I case of an equality of votes, the Chairman shall both on a show hands<br />
and at a poll, (if any), have a casting vote in addition to the vote or votes to which<br />
he may be entitled as a Member.<br />
262
Poll to be taken if<br />
demanded.<br />
90. If a poll is demanded as aforesaid, the same shall subject to Article 96<br />
and 103 be taken at such time, (not alter than forty-eight hours from the time<br />
when the demanded was made), and place with City, Town or Village in which<br />
the Registered Office of the Company is situate and either by open voting or by<br />
ballot, as the Chairman shall direct, and either at once or after an interval or<br />
adjournment, or otherwise, and the result of the poll shall be deemed to be the<br />
decision of the Meeting at which the poll was demanded. The demand for a poll<br />
may be withdrawn at any time by the person or persons who made the demand.<br />
Scrutineers at poll. 91. Where a poll is to be taken, the Chairman of Meeting shall appoint two<br />
scrutineers to scrutinise the votes given on the poll and to report thereon to him.<br />
One of the scrutineers so appointed shall always Member (not being an officer or<br />
employee of the Company) present at the Meeting, provided such a Member is<br />
available and willing to appointed. The Chairman shall have the power at any<br />
time before the result of the poll is declared, to remove a scrutineer from office<br />
and fill vacancies in the office of scrutineer arising from such removal or from<br />
any other cause.<br />
In what case poll taken<br />
without adjournment.<br />
Demand for poll not to<br />
prevent transaction of<br />
other business.<br />
92. Any poll duly demanded on the election of a Chairman of a meeting or<br />
on any question of adjournment shall be taken at the Meeting forthwith.<br />
93. The demand for a poll except on the question of the election of the<br />
Chairman and of an adjournment shall not prevent the continuance of a Meeting<br />
for the transaction of any business other than the question on which the poll has<br />
been demanded.<br />
VOTE OF MEMBERS<br />
Members in arrears not<br />
to vote.<br />
Number of votes to which<br />
Member entitled.<br />
94. No member shall be entitled to vote either personally or by proxy at any<br />
General Meeting or Meeting of a class of shareholders either upon a show of<br />
hands or upon a poll in respect of any shares registered in his name on which any<br />
calls or other sums presently payable by him have not been paid or in regard to<br />
which the Company has, and has exercised, any right of lien.<br />
95. Subject to the provisions of these Articles, and without prejudice to any<br />
special privileges or restrictions as to voting for the time being attached to any<br />
class of shares for the time being forming part of the capital of the Company,<br />
every Member, not disqualified by the last preceding Article, shall be entitled to<br />
be present, and to speak and vote at such Meeting, and on a show of hands every<br />
Member present in person shall have one vote and upon a poll, the voting right of<br />
every Member present in person or by proxy shall be in proportion to his share of<br />
the paid-up Equity Share capital of the Company.<br />
Provided however, if any preference shareholder be present at any<br />
Meeting of the Company, save as provided in Clause (b) of Sub-Section (2) of<br />
Section 87 of the Act, he shall have right to vote only on resolution placed before<br />
the Meeting which directly affect the rights attached to his preference shares.<br />
Casting of votes by a<br />
Member entitled to more<br />
than one vote.<br />
How Members<br />
Noncomponment is and<br />
Minor may vote<br />
Votes in respect of shares<br />
of deceased and insolvent<br />
96. On a poll taken at a Meeting of the Company, a Member entitled to more<br />
than one vote, or his proxy, or other person entitled to vote for him as the case<br />
may be, need not, if he votes, use all his votes or cast in the same way all the<br />
votes he uses.<br />
97. A Member of unsound mind, or in respect of whom an order has been<br />
made by any Court having jurisdiction in lunacy, may vote, whether on a show of<br />
hands or on a poll, by his committee or other legal guardian, and any such<br />
committee guardian may, on a poll, vote by proxy; if any member be a minor, the<br />
vote in respect of his share shall be by his guardian, or any one of his guardians, if<br />
more than one, to be elected in case of dispute by the Chairman of the meeting.<br />
98. Any person entitled under Article 63 to transfer any share may vote at<br />
any General Meeting in respect thereof in the same manner as if he were the<br />
263
Member.<br />
registered holder of such shares, provided that forty-eight hours at least before the<br />
time of holding the meeting or adjourned meeting, as the case may be, at which he<br />
proposes to vote he shall satisfy the Directors of his right to transfer such shares<br />
and give such indemnity (if any)y require or the Directors shall have previously<br />
admitted his right to vote at such meeting in respect thereof.<br />
Votes of joint Members. 99. If there be any joint registered holders of any shares, any one of such<br />
persons may vote at any meeting or may appoint another person, (whether a<br />
Member or not), his proxy in respect of such shares, as if he were solely entitled<br />
thereto; but the proxy so appointed shall not have any right to speak at the<br />
Meeting and if more than one of such joint-holders be present at any Meeting, that<br />
one of said persons so present whose name stands higher on the Register of<br />
Members shall alone be entitled to speak and to vote in respect of such shares but<br />
the other or others of the joint-holders shall be entitled to be present at the<br />
Meeting, Several, executors or administrators of a deceased Member in whose<br />
name shares stand shall for the purpose of these Articles be deemed joint-holders<br />
thereof.<br />
Voting in person or by<br />
proxy.<br />
100. Subject to the provisions of these Articles, vote may be given personally<br />
or by an attorney or by proxy. A Body corporate being a Member may vote either<br />
by a proxy or a representative duly authorised in accordance with Section 187 of<br />
the Act, and such representative shall be entitled to exercise the same rights and<br />
powers, (including the right to vote by proxy). On behalf of the body corporate<br />
which he represents as that body could exercise if it were an individual Member.<br />
Appointment of Proxy 101. Every Proxy, (whether a Member or not), shall be appointed in writing<br />
under the hand of the appointer or his attorney, or if such appointer corporation<br />
under the Common Seal of such corporation or be signed by a officer or an<br />
attorney duly authorised by it. In case of a Member who is of unsound mind or<br />
who is a minor, his committee or guardian may appoint such proxy. The proxy so<br />
appointed shall not have any right to speak at the meeting.<br />
Proxy either for specified<br />
Meeting or for a period.<br />
Proxy to vote only on a<br />
poll.<br />
Deposit of Instrument of<br />
appointment.<br />
102. An instrument of proxy may appoint a proxy either for the purpose of a<br />
particular Meeting specified in the instrument and any adjournment thereof or it<br />
may appoint a proxy for the purpose every Meeting of the Company, or of every<br />
Meeting to be held before a date specified in the instrument and every<br />
adjournment of any such meeting.<br />
103. A Member present by proxy shall be entitled to vote only on a poll.<br />
104. The instrument appointing a proxy and the power of attorney or other<br />
authority, (if any), under which it is signed or a notarially certified copy of that<br />
power or authority, shall be deposited at the Office not later than forty-eight hours<br />
before the time for holding the Meeting at which the person named in the<br />
instrument proposes to vote, and in default the instrument of proxy shall not be<br />
treated as valid. An attorney shall not be entitled to vote unless the power of<br />
attorney or other instrument appointing him or a notarially certified copy thereof<br />
has either been registered in the records of the Company at any time not less than<br />
forty-eight hours before the time for holding the Meeting at which the attorney<br />
proposes to vote, or is deposited at the Office of the Company not less than fortyeight<br />
hours before the time fixed for such Meeting as aforesaid. Notwithstanding<br />
that a power of attorney or other authority has been registered in the records of the<br />
Company. The Company may, be notice in writing addressed to the Member of<br />
the Attorney, given at least fourteen days before the meeting, require him to<br />
produce the original power of attorney or authority and unless the same is thereon<br />
deposited with the Company not less than forty-eight hours before the time fixed<br />
for the meeting, the attorney shall not be entitled to vote at such Meeting unless<br />
the Board in their absolute discretion excuse such non-production and deposit.<br />
Form of proxy. 105. Every instrument of proxy whether for a specified Meeting or otherwise<br />
should, as far as circumstances admit, be in any of the forms set out in Schedule<br />
IX of the Act.<br />
Validity of votes given by 106. A vote given in accordance with the terms of an instrument of proxy<br />
264
proxy notwithstanding<br />
death of Member.<br />
Time for objections to<br />
vote.<br />
Chairman of any<br />
Meeting to be the Judge<br />
of validity of any vote.<br />
shall be valid notwithstanding the previous death of the principal or revocation of<br />
the proxy or of any power of attorney under which such proxy was signed, or the<br />
transfer of the share in respect of which the vote is given, provided that no<br />
intimation in writing of the death, revocation or transfer shall have4 been received<br />
at the Office of the Company before the Meeting.<br />
107. No objection shall be made to the validity of any vote, except at the<br />
Meeting or poll at which such vote is tendered, and every vote whether given<br />
personally or by proxy, not disallowed at such Meeting or poll shall be deemed<br />
valid for all purposes of such Meeting or poll whatsoever.<br />
108. The Chairman of any Meeting shall be the sole judge of the validity of<br />
every vote tendered at such Meeting. The Chairman present at the taking of poll<br />
shall be the sole judge of the validity of every vote tendered at such poll.<br />
MINUTES OF MEETINGS<br />
Minutes of General<br />
Meeting and inspection<br />
thereof by Members.<br />
109. (1) The Company shall cause minutes of all proceedings of every<br />
General Meeting to be kept by making within thirty days of the<br />
conclusion of every such Meting concerned, entries thereof in books<br />
kept for the purpose with their pages consecutively numbered.<br />
(2) Each page of every such book shall be initialled or signed and the<br />
last page of the record of proceedings of each Meeting in such book<br />
shall be dated and signed by the Chairman of the same Meeting<br />
within the aforesaid period of thirty days or in the event of the death<br />
or inability of that Chairman within that period, by a Director duly<br />
authorised by the Board for that purpose.<br />
(3) In no case the minutes of proceedings of a Meeting shall be attached<br />
to any such book as aforesaid by pasting or otherwise.<br />
(4) The Minutes of each Meeting shall contain a fair and correct<br />
summary of the proceedings thereat.<br />
(5) All appointments of Officers made at any Meeting aforesaid shall be<br />
included in the minutes of the Meeting<br />
(6) Nothing herein contained shall require or be deemed to require the<br />
inclusion in any such Minutes of any matter which in the opinion of<br />
the Chairman of the Meeting is, or could reasonably be regarded as,<br />
defamatory of any person; is irrelevant or immaterial to the<br />
proceedings; or is detrimental to the interests of the Company. The<br />
Chairman of the Meeting shall exercise an absolute discretion in<br />
regard to the inclusion or non-inclusion of any matter in the Minutes<br />
on the aforesaid grounds.<br />
(7) Any such Minutes shall be evidence of the proceedings recorded<br />
therein.<br />
(8) The book containing the Minutes of proceedings of General Meeting<br />
shall be kept at the Registered Office of the Company and shall be<br />
open, during business hours, for such periods not being less in the<br />
aggregate than two hours in each day as the Board determines, to the<br />
inspection of any Member without charge.<br />
DIRECTORS<br />
Number of Directors 110. Until otherwise determined by General Meeting and subject to Section<br />
252 of the Act, the number of Directors (excluding Debenture and Alternate<br />
265
Directors) shall not be less than five or more than fifteen.<br />
Power to appoint exofficio<br />
Directors.<br />
111. Whenever the Company enters into a contract with any Government,<br />
Central, State or Local any Bank or financial institution or any person or persons<br />
(hereinafter referred to as “the appointor”) for borrowing any money or for<br />
providing any guarantee or security or for technical collaboration or assistance or<br />
for underwriting or enter into any other arrangement whatsoever, the Directors of<br />
the Company shall have, subject to the provisions of section 255 of the Act, the<br />
power to agree that such appointor shall have the right to appoint or nominate by<br />
notice in writing addressed to the Company one or more Directors on the Board<br />
for such period and upon such conditions as may be mentioned in the notice and<br />
that such Director or Directors may not be liable to retire by rotation not be<br />
required to hold any qualification shares. The Directors of the Company may also<br />
agree that any such Director or Directors may be removed from time to time by<br />
the appointor entitled to appoint or nominate them and the appointor may appoint<br />
another or others in his or their place and also fill in any vacancy, which may<br />
occur as a result of any such Director or Directors ceasing to hold that office for<br />
any reason whatever. The Directors appointed or nominated under this Article<br />
shall be entitled to exercise and enjoy all or any of the rights and privileges<br />
exercised and enjoyed by the Directors of the Company including payment of<br />
remuneration and travelling expenses to such Director or Directors s may be<br />
agreed by the Company with the appointor.<br />
The persons/nominees appointed as Directors shall be entitled to receive<br />
all notices of the Board of Directors of the Company and of the meetings of the<br />
Committee/s to which such person/Director is a member and also the Minutes of<br />
all such meetings.<br />
Debenture Director. 112. Any trust deed securing and covering the issue of debentures of the<br />
Company may provide for the appointment of a Director (in these presents<br />
referred to as “the Debenture Director”) for and on behalf of the Debentureholders<br />
for such period as is therein provided not exceeding the period for which the<br />
debenture or any of them shall remain outstanding and for the removal from office<br />
of such Debenture Director and on a vacancy being caused whether by<br />
resignation, death, removal or otherwise, for appointment of a Debenture Director<br />
in the vacant place. The Debenture Director shall not be liable to retire by rotation<br />
or be removed from office except as provided as aforesaid. The Debenture<br />
Director shall not be bound to hold any qualification shares.<br />
Appointment<br />
Alternate Director<br />
of<br />
113. The Board may appoint an Alternate Director to act for a Director<br />
(hereinafter called the “Original Director”) during his absence for a period of not<br />
less than three months from the State of Bombay. An Alternate Director appointed<br />
under this Article shall not hold office for a period longer than that permissible to<br />
the Original Director in whose place he has been appointed and shall vacate office<br />
if and when the Original Director returns to the State of Bombay. If the terms of<br />
office of the original Director is determined before he so returns to the state of<br />
Bombay, any provision in the Act or in these Article for the automatic<br />
reappointment of retiring Directors in default of another appointment shall apply<br />
to the Original Director and not to the Alternate Director.<br />
Directors’ power to add<br />
to the Board.<br />
Directors’ power to fill<br />
casual vacancies<br />
114. Subject to the provisions of Section 260 and 264 of the Act the Board<br />
shall have power at any time and from time to time to appoint any other qualified<br />
person to be an additional Director, but so that the total number of Directors shall<br />
not any time exceed the maximum fixed under Article 110. Any such additional<br />
Director shall hold office only upto the date of the next Annual General Meeting.<br />
115. Subject to the provisions of Section 264 and 284(6) of the Act, the Board<br />
shall have power at any time and from time to time to appoint any other qualified<br />
person to be Director to fill a casual vacancy. Any person so appointed shall hold<br />
office only upto the date upto which the Director in whos3e4 place he is<br />
appointed would have held office if it had not been vacated by him.<br />
Qualification of Directors 116. A Director of the Company shall not be required or bound to hold any<br />
qualification shares.<br />
266
Special Remuneration for<br />
Director performing<br />
extra service.<br />
Travelling expenses<br />
incurred by Director not<br />
a bonafide resident or by<br />
Director going out on<br />
Company business<br />
117. If any Director be called upon to perform extra services or make any<br />
special exertions or efforts (which expression shall include work done by a<br />
Director as a member of any Committee formed by the Directors) the Board may<br />
arrange with such Director for such special remuneration for such extra services<br />
or special exertions or efforts, either by fixed sum or a percentage of profits or<br />
otherwise as may be determined by the Board, and such remuneration may be<br />
either in addition to or in substitution for his remuneration above provided.<br />
118. The Board may allow and pay to any Director, who is not a bonafide<br />
resident of the place where the meetings of the Board are ordinarily held and who<br />
shall come to such place for the purpose of attending any meeting such sum as the<br />
Board may consider fair compensation or for travelling, boarding, lodging and<br />
other expenses in addition to his fee for attending such meeting as above<br />
specified; and if any Director be called upon to go or reside out of the Ordinary<br />
place of his residence on the Company’s business, he shall be entitled to be repaid<br />
and reimbursed any travelling or other expenses incurred in connection with the<br />
business of the Company.<br />
Remuneration<br />
Directors<br />
of<br />
119. (1) Subject to the provisions of the Act, a Managing Director or<br />
Director, who is in the whole-time employment of the Company may be paid<br />
remuneration either by way of a monthly payment or at a specified percentage of<br />
the net profits of the Company or partly by one way and partly by the other.<br />
(2) Subject to the provisions of the Act, a Director, who is neither<br />
in the whole-time employment nor a Managing Director may be paid<br />
remuneration either :-<br />
(i)<br />
(ii)<br />
by way of monthly, quarterly or annual payment with the approval<br />
of the Central Government; or<br />
by way of commission if the Company by special resolution<br />
authorises such payment.<br />
(3) The fee payable to a Director (including a Managing or Wholetime<br />
Director, if any) for attending a meeting of the Board or Committee thereof<br />
shall be such sum as the Board may determine from time to time but not<br />
exceeding such sum as may be prescribed by the Central Government under the<br />
Act from time to time.<br />
Continuing Directors<br />
may act notwithstanding<br />
any vacancy<br />
When office of Directors<br />
to be vacated.<br />
120. The continuing Directors may act notwithstanding any vacancy in their<br />
body but if and so long as their number is reduced below the minimum fixed by<br />
Article 110 hereof, the continuing Directors not being less than two may act for<br />
the purpose of increasing the number of Directors to that number, or summoning a<br />
General Meeting, but for no other purpose.<br />
121. Subject to Section 283(2) of the Act, the office of a Director shall be<br />
vacated if :<br />
(a)<br />
jurisdiction; or<br />
(b)<br />
(c)<br />
he is found to be of unsound mind by a Court of Competent<br />
he applies to be adjudicated an insolvent; or<br />
he is adjudged an insolvent; or<br />
(d) he is convicted by a Court of any offence involving moral<br />
turpitude and is sentenced in respect thereof to imprisonment for not less than six<br />
months; or<br />
(e) he fails to pay any call made on him in respect of shares of the<br />
Company held by him whether alone or jointly with others, within six months<br />
from the date fixed for the payment of such call, unless the Central Government<br />
has by notification in the Official Gazette removed the disqualification incurred<br />
by such failure; or<br />
267
(f) he absents himself from three consecutive Meetings of the<br />
Board or from all Meetings of the Board for a continuous period of three months,<br />
whichever is longer, without leave of absence from the Board; or<br />
(g) he, (whether by himself or by any person for his benefit or on<br />
his account), or any firm in which he is a partner, or any private company of<br />
which he is director, accepts a loan, or any guarantee or security for a loan, from<br />
the Company, in contravention of Section 295 of the Act; or<br />
(h)<br />
(i)<br />
(j)<br />
he acts in contravention of Section 299 of the Act; or<br />
he is removed in pursuance of Section 284 of the Act; or<br />
he is removed in pursuance of Section 284 of the Act; or<br />
(k) he or any of his relatives or partners or any firm of which he or<br />
any of his relative is a partner or any private company of which he is a Director or<br />
member holds any office or place of profit under the Company in contravention of<br />
Section 314 of the Act; or<br />
Board.<br />
(l)<br />
he resins his office by a notice in writing addressed to the<br />
Director may contract<br />
with Company.<br />
122. (1) A Directors or his relative, a firm in which such Director or<br />
relative is a partner, or any other partner in such a firm, or a private company of<br />
which the Director is a member or Director, may enter into any contract with the<br />
Company for the sale, purchase or supply of any goods materials or services or for<br />
underwriting the subscription of any shares in, or debentures of, the Company;<br />
Provided that the sanction of the Board is obtained before or within three months<br />
of the date on which the contract is entered into in accordance with Section 2987<br />
of the Act. Provided further that if the paid-up share capital of the Company is<br />
Rupees one crore or more, no such contract shall be entered into except with the<br />
previous approval of the Central Government as may be required under the<br />
provisions of Section 297 of the said Act.<br />
(2) No sanction however shall be necessary for:<br />
(a) any purchase of goods and materials from the Company, or the<br />
sale of goods or materials to the Company by any such Director, relative, firm,<br />
partner or private Company as aforesaid for cash at prevailing market prices; or<br />
(b) any contract or contracts between the Company on one side and<br />
such Director, relative, firm, partner or private company on the other, for sale,<br />
purchase or supply of any goods, materials and services, in which either the<br />
Company or the Director, relative, firm, partner or private company, as the case<br />
may be regularly trades or does business, where the value of the goods and<br />
materials or the cost of such services does not exceed Rs.5,000/- in the aggregate<br />
in any year comprised in the period of the contract or contracts.<br />
Provided that in circumstances of urgent necessity, a Director, relative,<br />
firm, partner or private company as aforesaid may without obtaining the consent<br />
of the Board enter into any such contract or contracts with the Company for the<br />
sale, purchase or supply of any goods, materials or services even if the value of<br />
such goods or materials or the cost of such services exceeds Rs.5,000/- in the<br />
aggregate in any year comprised in the period of the agreement, if the consent of<br />
the Board shall be obtained to such contract or contracts at a meeting within three<br />
months of the date on which the contract was entered into.<br />
(3) The Directors, so contracting or being so interested shall not be<br />
liable to the Company for any profit realised by any such contract or the fiduciary<br />
relation thereby established.<br />
Disclosure of Interest. 123. A Director of the Company who is in any way, whether directly or<br />
indirectly, concerned or interested in a contract or arrangement, or proposed<br />
contract or agreement entered into or to be entered into by or on behalf of the<br />
268
Company shall disclose the nature of his concern or interest at a Meeting of the<br />
Board in the manner provided in Section 299 (2) of the Act; Provided that it shall<br />
not be necessary for a Director to disclose his concern or interest in any such<br />
contract or arrangement entered into or to be entered into between two companies<br />
where any of the Directors of the one company or two or more of them together<br />
holds or hold not more than 2 per cent of the paid-up share capital in any such<br />
other Company.<br />
General notice of<br />
interest.<br />
Interested Director not to<br />
participate or vote in<br />
Board’s proceeding.<br />
124. A general notice given to the Board by the Director, to the effect that he<br />
is a director or member of a specified body corporate or is a member of a<br />
specified firm and is to be regarded as concerned or interested in any contract or<br />
arrangement which may, after the date of the notice, be entered into which that<br />
body corporate or firm, shall be deemed to be a sufficient disclosure of concern or<br />
interest in relation to any contract or arrangement so made. Any such general<br />
notice shall expire at the end of the financial year in which it is given but may be<br />
renewed for a further period of one financial year at a time by a fresh notice given<br />
in the last month of the financial year in which it would have otherwise expired.<br />
No such general notice, and no renewal thereof shall be of effect unless, either it<br />
is given at a meeting of the Board or the Directors concerned takes reasonable<br />
steps to secure that it is brought up and read at the first Meeting of the Board after<br />
it is given.<br />
125. No director shall as a Director, take any part in the discussion of, or vote<br />
on any contract or arrangement entered into or to be entered into by or on behalf<br />
of the Company, if he is in any way, whether directly or indirectly, concerned or<br />
interested in such contract or arrangement; nor shall his presence count for the<br />
purpose of forming a quorum at the time of any such discussion or vote; and if<br />
does vote, his vote shall be void; Provided however that nothing herein contained<br />
shall apply to :<br />
(a)<br />
(b)<br />
any contract or indemnity against any loss which the Directors, or<br />
any one or more of them, may suffer by reason of becoming or being<br />
sureties or a surely for the Company;<br />
any contract or arrangement entered into or to be entered into with a<br />
public company or a private company which is subsidiary of a<br />
public company in which the interest of the Director consists solely<br />
:-<br />
(i) in his being -<br />
(a)<br />
(b)<br />
a Director of such company, and<br />
the holder of not more than shares of such<br />
number or value therein as is requisite to<br />
qualify him for appointment as a Director<br />
thereof, he having been nominated as such<br />
Director by this Company, or<br />
(ii)<br />
in his being a member holding not more than 2 per cent<br />
of its paid-up share capital.<br />
Register of contracts in<br />
which Directors are<br />
interested.<br />
126. The Company shall keep a Register in accordance with Section 301(1) of<br />
the Act and shall within the time specified in Section 301(2) of the Act enter<br />
therein such of the particulars as may be relevant having regard to the application<br />
thereto of Section 297 or Section 299 of the Act, as the case may be. The Register<br />
aforesaid shall also specify, in relation to each Director of the Company, the<br />
names of the bodies corporate and firms of which notice has been given by him<br />
under Article 124. The Register shall be kept at the Registered Office of the<br />
Company and shall be open to inspection at such Office, and extracts may be<br />
taken therefrom and copies thereof may be required by any Member of the<br />
Company to the same extent, in the same manner, and on payment of the same fee<br />
as in the case of the Register of Members of the Company and the provisions of<br />
Section 163 of the Act shall apply accordingly.<br />
269
Directors may be<br />
Directors of Companies<br />
promoted by the<br />
Company.<br />
127. A Director may be or becomes a Director of any Company promoted by<br />
the Company, or in which it may be interested as a vendor, shareholder, or<br />
otherwise, and any such Director shall be accountable for any benefits received<br />
and Director or shareholder of such Company except in so far as Section 309 (6)<br />
or Section 314 of the Act may be applicable.<br />
RETIREMENT AND ROTATION OF DIRECTOR<br />
Retirement and rotation<br />
of Directors.<br />
Ascertainment of<br />
Directors retiring by<br />
rotation and filling of<br />
vacancies.<br />
128. At every Annual General Meeting of the Company, one-third of such of<br />
the Directors for the time being as are liable to retire by rotation or if their number<br />
is not three or a multiple of three, the number nearest to one-third shall retire from<br />
office. The non-retiring Directors and Debenture Directors, if any, shall not be<br />
subject to retirement under this Article and shall not be taken into account in<br />
determining the rotation of retirement or the number of Directors to retire.<br />
129. Subject to the provisions of Section 256 (2) of the Act, the Directors to<br />
retire by rotation under the forgoing Article 128 at every Annual General Meeting<br />
shall be those who have been longest in office since their last appointment, but as<br />
between persons who become Directors on the same day, those who are to retire<br />
shall, in default of the subject to any Agreement among themselves, be<br />
determined by lot.<br />
Eligibility for re-election 130. A retiring Director shall be eligible for re-election.<br />
Company to appoint<br />
successors.<br />
Provision in default of<br />
appointment.<br />
131. Subject to Section 258 and 262 of the Act, the Company at the General<br />
Meeting at which a Director retires in the manner aforesaid, may fill up the<br />
vacated office by electing such retiring Director or some other person thereto.<br />
132. (a) If the place of the retiring Director is not so filled up and the<br />
Meeting has not expressly resolved not to fill the vacancy, the Meeting shall stand<br />
adjourned till the same day in the next week, t the same time and place, or if that<br />
day is a public holiday, till the next succeeding day which is not a public holiday,<br />
at the same time and place<br />
(b) If at the adjourned Meeting also, the place of the retiring<br />
Director is not filled up and that Meeting also has not expressly resolved not to fill<br />
the vacancy, the retiring Director shall be deemed to have been re-appointed at the<br />
adjourned meeting unless :<br />
(i)<br />
(ii)<br />
(iii)<br />
(iv)<br />
(v)<br />
at the Meeting or at the previous Meeting, a resolution for the<br />
re-appointment of such Director has been put to the Meeting and<br />
lost;<br />
the retiring Director has, by a notice in writing addressed to the<br />
Company or its Board, expressed his unwillingness to be so reappointed;<br />
he is not qualified or is disqualified for re-appointment;<br />
a resolution, whether special or ordinary is required for the<br />
appointment or re-appointment by virtue of any provisions of<br />
the Act; or<br />
the provision so sub-section (2) of Section 263 of the Act is<br />
applicable to the case.<br />
Company may increase<br />
or reduce the number of<br />
Directors.<br />
133. Subject to Section 259 of the Act, the Company may, by ordinary<br />
resolution, from time to time increase or reduce the number of Directors and may<br />
alter their qualifications and the Company may, (subject to the provisions of<br />
Section 284 of the Act), remove any Director before the expiration of his period<br />
of office and appoint another qualified person in his stead. The person so<br />
appointed shall hold office during such time as the Director in whose place he is<br />
appointed would have held the same if he had not been removed.<br />
270
Notice of candidate for<br />
office of Director except<br />
in certain cases.<br />
134 (1) No person not being a retiring Director, shall be eligible for<br />
appointment to the office of Director at any General Meeting unless he or some<br />
members intending to propose him has, not less than fourteen days before the<br />
meeting, left at the Office of the Company a notice in writing under his hand<br />
signifying his candidature for the office of Director or the intention of such<br />
member to propose him as a candidate for that office, along with a deposit of five<br />
hundred rupees which shall be refunded to such person or, as the case may be,<br />
such member, if the person succeeds in getting elected as a Director.<br />
(2) Every person (other than a Director retiring by rotation or<br />
otherwise or a person who has left at the office of the Company a notice under<br />
Section 257 of the Act signifying his candidature for the office of a Director)<br />
proposed as a candidate for the office of a Director shall sign and file with the<br />
Company, the consent in writing to act as a Director, if appointed;<br />
(3) A person other than a Director re-appointed after retirement by<br />
rotation or immediately on the expiry of his term of office; or an Additional or<br />
Alternate Director, or a person filling a casual vacancy in the office of a Director<br />
under Section 262 of the Act, appointed as a Director or re-appointed as a<br />
Additional or Alternate Director, immediately on the expiry of his term of office<br />
shall not act as a Director of the Company, unless he has within thirty days of his<br />
appointment signed and filed with the Registrar his consent in writing to act as<br />
such Director.<br />
(a) Register of Directors<br />
and notification of<br />
change of Registrar.<br />
Register of shares of<br />
debentures held by<br />
Director.<br />
(a) Disclosure by Director<br />
of appointment to any<br />
other body corporate.<br />
135. (a) The Company shall keep at its Registered Office, a Register<br />
containing the particulars of its Directors, Manager, Secretary and other persons<br />
mentioned in Section 303 of the Act, and shall otherwise comply with the<br />
provisions of the said Section in all respects.<br />
(b) The Company shall in respect of each of his Directors also keep<br />
at its Registered Office a Register as required by Section 307 of the Act, and shall<br />
otherwise duly comply with the provisions of the said section in all respects.<br />
136. (a) Every Director, (including a person deemed to be a Director by<br />
virtue of the Explanation to sub-section (1) of Section 303 of the Act), Managing<br />
Director, Manager, and Secretary of the Company shall, within twenty days of his<br />
appointment to any of the above offices in any other body corporate disclose to<br />
the Company, the particulars relating to his office in the other body corporate<br />
which are required to be specified under sub-section (1) of Section 303 of the Act.<br />
(b) Every Director and every person deemed to be Director of the<br />
Company by virtue of sub-section (10) of Section 307 of the Act, shall give notice<br />
to the Company of such matters relating to himself as may be necessary for the<br />
purpose of enabling the Company to comply with the provisions of that section.<br />
Appointment of<br />
Managing Director or<br />
Whole-time Director.<br />
Managing and Wholetime<br />
Director not to<br />
retire by rotation.<br />
137. (a) Subject to the provisions of Section 197A, 267, 268, 269, 309,<br />
310, 311, 316 and 317 and other applicable provisions of the Act, the Company in<br />
General Meeting or the Directors may from time to time appoint or re-appoint any<br />
one or more of their Body to be a Managing Director or Managing Directors (in<br />
which expression shall be included a Joint Managing Director or a Deputy<br />
Managing Director) or Whole-time Director or Whole-time Directors of the<br />
Company for such term not exceeding five years at a time as may be thought fit to<br />
manage the business and affairs of the Company and may from time to time<br />
(subject to the provisions of any contract between him or them and the Company)<br />
remove or dismiss him or them from office and appoint another or others in his or<br />
their place or places.<br />
(b) The Managing Director or Whole-time Director, while he<br />
continues to hold that office, shall not be subject to retirement by rotation, but he<br />
shall subject to the provisions of any contract between him and the Company, be<br />
subject to the same provision as to resignation or removal of the other Directors of<br />
the Company and he shall ipso facto immediately cease to be a Managing Director<br />
or Whole time Director if he ceases to hold the office of a Director, for any cause,<br />
provided that if at any time the number of Directors (including the Managing<br />
271
Director or Whole-time Director) as are not subject to retirement by rotation shall<br />
exceed one-third of the total number of the Directors for the time being, then such<br />
Managing Director or Managing Directors or Whole-time Director or Whole-time<br />
Directors as the Directors shall from time to time select shall be liable to<br />
retirement by rotation to the intent that the Directors not liable to retirement by<br />
rotation shall not exceed one-third of the total number of Directors for the time<br />
being.<br />
A Managing Director or a Whole-time Director, who is re-appointed as a<br />
Director immediately on retirement by rotation, shall continue to hold his office of<br />
Managing Director or Whole-time Director and such re-appointment as Director<br />
shall not be deemed to constitute a break in his appointment as Managing Director<br />
or Whole-time Director.<br />
Remuneration of<br />
Managing or Whole-time<br />
Director.<br />
Powers and duties of<br />
Managing or Whole-time<br />
Director.<br />
(c) The remuneration of a Managing Director or a Whole-time<br />
Director shall subject to the provisions of any contract between the Company and<br />
him be from time to time fixed by the Board of Directors and subject to the<br />
provisions of the Act, may be by way of fixed salary or commission on profit of<br />
the company, or by any or all these modes and may be in addition to the<br />
remuneration for attendance at the Board Meetings and any other remuneration<br />
which may be provided under any other Articles.<br />
(d) The Directors may from time to time subject to the provisions<br />
of the Act entrust to or confer upon the Managing Director or Whole-time<br />
Director for the time being such of the powers exercisable b the Directors under<br />
these presents or by Law, as they may think fit, and may confer such powers for<br />
such time and to be exercised for such objects and purposes and upon such terms<br />
and conditions and with such restrictions as they think expedient and they may<br />
confer such powers either collaterally with or to the exclusion of or in substitution<br />
for all or any of the powers of the Directors in that behalf and may from time to<br />
time revoke, withdraw, alter or vary all or any of such powers.<br />
(e) (i) Mr. B.M.Ghia, during the period he continues to hold office<br />
of Managing Director shall not be liable to retire by rotation<br />
as a Director of the Company; and<br />
(ii)<br />
Mr. D. S. Dalal, during the period he continues to hold<br />
office of Joint Managing Director shall not be liable to<br />
retire by rotation as a Director of the Company.<br />
Restriction<br />
Management.<br />
on<br />
138. The Managing Director or Managing Directors shall not exercise the<br />
powers to :<br />
(a)<br />
Make calls on shareholders in respect of money unpaid on the<br />
shares in the Company;<br />
(b) issue debentures :<br />
and except to the extent mentioned in the resolution passed at<br />
the Board meeting under Section 292 of the Act, shall also not<br />
exercise the power to<br />
(c)<br />
(d)<br />
(e)<br />
borrow moneys, otherwise than on debentures;<br />
invest the funds of the Company; and<br />
make loans.<br />
PROCEEDINGS OF THE BOARD OF DIRECTORS<br />
Meeting of Directors. 139. The Directors may meet together as a Board for the despatch of business<br />
from time to time and shall so meet at least once in every three months and at<br />
least four such meetings shall be held in every year. The Directors may adjourn<br />
272
and otherwise regulate their meetings as they think fit.<br />
Notice of Meetings of the<br />
Board.<br />
140. Notice of every Meeting of the Board shall be given in writing to every<br />
Director for the time being in India, and at his usual address in India to every<br />
other Director.<br />
Quorum 141. Subject to the Section 287 of the Act, the quorum for a Meeting of the<br />
Board shall be one-third of the total number of Directors for the time being<br />
(excluding Directors if an whose places may be vacant at the time and any<br />
fraction contained in that one-third being rounded off as one), or two Directors,<br />
whichever is higher. Provided that where at any time the number of interested<br />
Directors exceeds or is equal to two-thirds of the total strength, the number of<br />
remaining Directors, that is to say, the number of Directors who are not interested<br />
present at the Meeting being not less than two, shall be the quorum during such<br />
time.<br />
Adjournment of<br />
Meetings for want of<br />
quorum.<br />
When Meeting to be<br />
convened.<br />
Chairman and Vice-<br />
Chairman<br />
Questions at Board<br />
Meetings how decided.<br />
142. If a Meeting of the Board could not be held for want of a quorum, then<br />
the Meeting shall automatically stand adjourned to such other day, time and place<br />
as may be fixed by the Chairman not being later than seven days from the date<br />
originally fixed for the Meeting.<br />
143. A Director may at any time, and the Secretary upon the request of a<br />
Director shall, convene a Meeting of the Board by giving a notice in writing to<br />
every other Director.<br />
144. The Directors may from time to time elect from among their number a<br />
Chairman of the Board and determine the period for which he is to hold office.<br />
The Directors may also from time to time elect from their number a Vice-<br />
Chairman of the Board and determine the period for which he is to hold office. If<br />
at any meeting of the Board, the Chairman is not present, within fifteen minutes<br />
after the time appointed for the same, the Vice-Chairman shall be the Chairman of<br />
that meeting. If at any meeting of the Board, the Chairman or the Vice-Chairman<br />
are not present within fifteen minutes after the time appointed for holding the<br />
meeting the Directors present may choose one of their member to be the<br />
Chairman of the Meeting.<br />
145. Questions arising at any meeting of the Board shall be decided by a<br />
majority of the votes and in case of an equality of votes, the Chairman shall have<br />
a second or a casting vote.<br />
Powers of Board Meeting 146. A Meeting of the Board for the time being at which a quorum is present<br />
shall be competent to exercise all or any of the authorities powers and discretions<br />
which by or under the Act or the Articles of the Company are for the time being<br />
vested in or exercisable by the Board generally. Without prejudice to the powers<br />
conferred by the other Articles and so as not in any way to limit or restrict those<br />
powers, the Board may, subject to the provisions of Section 292 of the Act,<br />
delegate any of their powers to the Managing Director the Manager or any other<br />
principal officer of the Branch Office and may at any time revoke such<br />
delegation. The Managing Director, the Manager or other principal officer as<br />
aforesaid shall, in the exercise of the powers so delegated, conform to any<br />
regulations that may from time to time be imposed on them by the Board and all<br />
acts done by them in exercise of the powers so delegated and in conformity with<br />
such regulations shall have the like force and effects as if done by them in<br />
exercise of the powers so delegated and in conformity with such regulations shall<br />
have the like force and effect as if done by the Board.<br />
Board may appoint<br />
Committees.<br />
147. Subject to the restrictions contained in Section 292 of the Act, the Board<br />
may delegate any of their powers to Committees of the Board consisting of such<br />
Member or Members of its body as it thinks fit, and it may from time to time<br />
revoke and discharge any such Committees of the Board either wholly or in part,<br />
and either as to persons or purposes; but every Committee of the Board so formed<br />
shall in the exercise of the powers so delegated conform to any regulations that<br />
may from time to time be imposed on it by the Board. All acts done by any such<br />
Committee of the Board in conformity with such regulations and in fulfillment of<br />
the purposes of their appointment but not otherwise, shall have the like force and<br />
273
effect as if done by the Board.<br />
Meeting of Committee<br />
how to be governed<br />
148. The meetings and proceedings of any such Committee of the Board<br />
consisting of two or more Members shall be governed by the provisions herein<br />
contained, for regulating the meetings and proceedings of the Directors, so far as<br />
the same are applicable thereto and are not superseded by any regulations made<br />
by the Directors under the last preceding Article.<br />
Resolution by circular. 149. No resolution shall be deemed to have been duly passed by the Board or<br />
by a Committee thereof by circulation, unless the resolution has been circulated in<br />
draft, together with the necessary papers, if any, to all the Directors, or to all the<br />
members of the Committee, then in India (not being less in number than the<br />
quorum fixed for a Meeting of the Board of Committee, as the case may be), and<br />
to all other Directors or Members of the Committee, at their usual address in India<br />
and has been approved by such of the Directors or Members of the Committee as<br />
are then in India, or by a majority of such of them, as are entitled to vote on the<br />
resolution.<br />
Acts of Board or<br />
Committee valid not<br />
withstanding informal<br />
appointment.<br />
Minutes of proceedings<br />
of Meetings of the Board<br />
150. All acts done by any Meeting of the Board or by a Committee of the<br />
Board, or by any person acting as a Director shall notwithstanding that it shall<br />
afterwards be discovered that there was some defect in the appointment of such<br />
Director or persons acting as aforesaid, or that they or any of them were disqualified<br />
or had vacated office or that the appointment of any of them had been<br />
terminated by virtue of any provisions contained in the Act or in these Articles, be<br />
as valid as if every such person had been duly appointed, and was qualified to be a<br />
Director and had not vacated his office or his appointment had not been<br />
terminated. Provided that nothing in this Article shall be deemed to give validity<br />
151. (1) The Company shall cause minutes of the proceedings of the<br />
every Meeting of the Board to be kept by making within fourteen days of the<br />
conclusion of every such Meeting, entries thereof in books kept for that purpose<br />
with their pages consecutively numbered.<br />
(2) Each page of every such book shall be initialled or signed and<br />
the last page of the record of proceedings of each Meeting in such book shall be<br />
dated and signed by the Chairman of the said Meeting or the Chairman of the next<br />
succeeding Meeting.<br />
(3) In no case the minutes of proceedings of a Meetings shall be<br />
attached to any such books as aforesaid by pasting or otherwise.<br />
(4) The minutes of each Meeting shall contain a fair and correct<br />
summary of the proceedings thereat.<br />
(5) All appointments of officers made at any of the Meetings<br />
aforesaid shall be included in the minutes of the Meegting.<br />
(6) The minutes shall also contain -<br />
(a)<br />
the names of the Directors present at the Meeting and<br />
(b) in the case of each resolution passed at the Meeting, of the<br />
names of the Directors, if any, dissenting from or not concurring in, the<br />
resolution.<br />
(7) Nothing contained in sub-clauses (1) to (6) shall be deemed to<br />
require the inclusion in any such minutes of any matter, which in the opinion of<br />
the Chairman of the Meeting -<br />
person;<br />
(a)<br />
is or could reasonably be regarded as, defamatory of any<br />
(b)<br />
is irrelevant or immaterial to the proceedings; or<br />
274
(c)<br />
is detrimental to the interest of the Company.<br />
The Chairman shall exercise an absolute discretion in regard to<br />
the inclusion or non-inclusion of any matter in the minutes on the grounds<br />
specified in this sub-clause.<br />
(8) Minutes if Meetings kept in accordance with the aforesaid<br />
provisions shall be evidence of the proceedings recorded therein.<br />
General powers of the<br />
Board<br />
152. The management and control of the business of the Company shall be<br />
vested in Director who may exercise all such powers of the Company and do all<br />
such acts and things, as are not, by the Act, or any other Act or by the<br />
Memorandum or by Articles of the Company required to be exercised by the<br />
Company in General Meeting, subject nevertheless to these Articles, to the<br />
provisions of the Act, or any other Act and to such regulations being not<br />
inconsistent with the aforesaid regulations or provisions, as may be prescribed by<br />
the Company in General Meeting but no regulation made by the Company in<br />
General Meeting, shall invalidate any prior act of the Board which would have<br />
been valid if that regulation had not been made. Provided that the Board shall not,<br />
except with the consent of the Company in the Company General Meeting:-<br />
(a)<br />
(b)<br />
(c)<br />
(d)<br />
sell, lease or otherwise dispose of the whole, or substantially the<br />
whole, of the undertaking of the Company, or where the Company<br />
owns more than one undertaking, of the whole or substantially the<br />
whole of any such undertaking;<br />
remit or give time for the repayment of any debt due by a Director;<br />
invest, otherwise than in trust securities, the amount of<br />
compensation received by the Company in respect of the<br />
compulsory acquisition of any such undertaking as is referred to in<br />
sub-article (a) or of any premises or properties or properties used for<br />
any such undertaking and without which it cannot be carried on or<br />
can be carried on only with difficulty or only after a considerable<br />
time;<br />
borrow moneys where the moneys to be borrowed together with the<br />
moneys already borrowed by the Company (apart from temporary<br />
loans obtained from the Company’s bankers in the ordinary course<br />
of business), will exceed the aggregate of the paid up capital of the<br />
Company and its free reserves that is to say, reserves not set apart<br />
for any specific purpose.<br />
Provided further that the powers specified in Section 292 of the Act<br />
shall, subject to these Articles, be exercised only at Meetings of the<br />
Board, unless the same be delegated to the extent therein stated.<br />
(e)<br />
contribute to charitable and other funds not directly relating to the<br />
business of the Company or the welfare of its employees, any<br />
amounts the aggregate of which will, in any financial year, exceed<br />
twenty-five thousand rupees or five per cent of its average net<br />
profits as determined in accordance with the provisions of Sections<br />
349 and 350 of the Act during the three financial years immediately<br />
preceding whichever is greater.<br />
Certain powers of the<br />
Board<br />
153. Without prejudice to the general powers conferred by the last preceding<br />
Article and so as not in any way to limit or restrict those powers, and without<br />
prejudice to the other powers conferred by these Articles, but subject to the<br />
restrictions contained in the last preceding Article, it is hereby declared that the<br />
Board shall have the following powers that is to say, power:<br />
(1) To pay and change to the capital account of the Company any<br />
commission or interest lawfully payable under the provisions of Sections 76 and<br />
208 of the Act.<br />
275
(2) Subject to Sections 292 and 297 and other applicable provisions<br />
of the Act, to purchase or otherwise acquire for the Company any property, rights<br />
or privileges which the Company is authorised to acquire, at or for such price or<br />
consideration and generally on such terms and conditions as they may think fit,<br />
and in any such purchase or other acquisition to accept such title as the Board may<br />
believe or may be advised to be reasonably satisfactory.<br />
(3) At their discretion and subject to the provisions of the Act, to<br />
pay for any property, rights or privileges acquired by or services rendered to the<br />
Company, either wholly or partially, in cash or in shares, bonds, debentures,<br />
mortgages, or other securities of the Company, and any such shares may be issued<br />
either as fully paid up or with such amount credited as paid up thereon as may be<br />
agreed upon; and any such bonds, debentures, mortgages or other securities may<br />
be either specifically charged upon all or any part of the property of the Company<br />
or not so charged.<br />
(4) To secure the fulfilment of any contracts or engagements<br />
entered into by the Company by mortgage or charge of all or any of the property<br />
of the Company for the time being or in such manner as they may think fit.<br />
(5) To accept from any Member, as far as may be permissible by<br />
law, a surrender of his shares or any part thereof, on such terms and conditions as<br />
shall be agreed.<br />
(6) To appoint any person to accept and hold in trust for the<br />
Company, any property belonging to the Company, or in which it is interested, or<br />
for any other purposes; and to execute and do all such deeds and things as may be<br />
required in relation to any such trust, and to provide for the remuneration of such<br />
trustee.<br />
(7) To institute, conduct, defend, compound or abandon any legal<br />
proceedings by or against the Company or its officers, or otherwise concerning<br />
the affairs of the Company and also to compound and allow time for payment or<br />
satisfaction of any debts due, and of any claims or demands by or against the<br />
Company and to refer any claims demands by or against the Company to<br />
arbitration and observe, the terms of any awards made thereon.<br />
(8) To act on behalf of the Company in all matters relating to<br />
bankrupts and insolvents and winding up and liquidation of Companies.<br />
(9) To make and give receipts, release and other discharges for<br />
moneys payable to the Company and for the claims and demands of the Company.<br />
(10) Subject to the provisions of Sections 77, 292, 293(1)(a), 295,<br />
370 and 372 to invest and deal with any moneys of the Company not immediately<br />
required for the purposes thereof, upon such security, (not being shares of this<br />
Company), or without security and in such manner as they may think fit, and from<br />
time to time vary or realise such investments. Save as provided in Section 49 of<br />
the Act, all investments shall be made and held in in the Company’s own name.<br />
(11) To execute in the name and on behalf of the Company in favour<br />
of any Director other person who may incur or be about to incur any personal<br />
liability whether as principal or surety, for the benefit of the Company, such<br />
mortgage of the Company’s property (present and future), as they think fit, and<br />
any such mortgage may contain a power of sale and such other powers,<br />
provisions, covenants, and agreements as shall be agreed upon.<br />
(12) To determine from time to time who shall be entitled to sign, on<br />
the Company’s behalf, bills, notes, receipts, acceptances, endorsement, cheques,<br />
dividend, warrants, releases, contracts and documents and to give the necessary<br />
authority for such purposes.<br />
(13) To distribute by way of bonus amongst the staff of the<br />
Company, a share or shares in the profits of the Company, and to give any<br />
276
Director, officer or other person employed by the Company a commission on the<br />
profits of any particular business or transaction; and to charge such bonus or<br />
commission as part of the working expenses of the Company.<br />
(14) To provide for the welfare Directors or ex-Directors or<br />
employees or ex-employees of the Company and the wives, widows and families<br />
or the dependents or connections of such persons, by building or contributing to<br />
the building of houses, dwellings or chawls, or by grants of money, pensions,<br />
gratuities, allowances, bonus, or other payments; or by creating and from time to<br />
time subscribing or contributing to provident and other associations, institutions,<br />
funds, and trusts and by providing and subscribing or contributing towards places<br />
of instruction and recreation, hospitals and dispensaries, medical and other<br />
attendance and other assistance as the Board shall think fit; and to subscribe or<br />
contribute or otherwise to assist or to guarantee money to charitable, benevolent,<br />
religious, scientific, national, or other institutions or objects which shall have any<br />
moral or other claim to support or aid by the Company, either by reasons of<br />
locality of operation, or of public and general utility or otherwise; Provided that<br />
when contributing (a) to any political party or (b) for any political purpose to any<br />
individual or body, the provisions of Section 293A of the Act shall be complied<br />
with.<br />
(15) Before recommending any dividend, to set aside, out of the<br />
profits of the Company such sums as they may think proper for depreciation or to<br />
Depreciation Fund, or to an Insurance Fund, or as a Reserve Fund, or Sinking<br />
Fund, or any special fund to meet conntigencies, or to repay debentures or<br />
debenture stock, or for special dividends or for equalising dividends, or for<br />
repairing, improving, extending and maintaining any of the property of the<br />
Company, and for such other purposes (including the purposes referred to in the<br />
preceding clause), as the Board of Directors may, in their absolute discretion,<br />
think conducive to the interests of the company, and subject to Section 292 of the<br />
Act, to invest the several sums so sets aside or so much thereof as required to be<br />
invested, upon such investments (other than shares of the Company) as they may<br />
think fit, and from time to time to deal with and vary such investments and<br />
dispose of and apply and expand all or any part thereof for the benefit of the<br />
Company, in such manner and such purposes as the Board of Directors, in their<br />
absolute discretion, think conducive to the interests of the company<br />
notwithstanding that the matters to which the Board of Directors apply or upon<br />
which they expend the same, or any part thereof, may be matters to or upon which<br />
the capital moneys of the Company might rightly be applied or expended; and to<br />
divide the Reserve Funds into such special funds as the Board of Directors may<br />
think fit, with full power to transfer the whole or any portion of a Reserve Funds<br />
or division of Reserve Fund and with full powers to employ the assets constituting<br />
all or any of the above funds including, the Depreciation Fund, in the business of<br />
the Company or in the purchase or repayment of debentures or debenture stock,<br />
and without being bound to pay interest on the same with power however to the<br />
Board of Directors at their discretion to pay or allow to the credit of such funds<br />
interest at such rate as the Board of Directors may think proper, not exceeding<br />
nine per cent per annum.<br />
(16) To appoint and at their discretion remove or suspend such<br />
general managers, managers, secretaries, stenographers, assistants, supervisors,<br />
clerks, agents and servants for permanent, temporary or special services as they<br />
may from time to time think fit, and to determine their powers and duties, and fix<br />
their salaries or emoluments or remunerations, and to require security in such<br />
instances and for such amounts as they may think fit. And also from time to time<br />
to provide for the management and transaction of the affairs of the Company in<br />
any specified locality in India or elsewhere in such manner as they think fit; and<br />
the provisions contained in the following sub-articles shall be without prejudice to<br />
the general powers conferred by this sub-article.<br />
(17) To comply with the requirements of any local law which in its<br />
opinion, it shall in the interest of the Company necessary or expedient to comply<br />
with.<br />
277
(18) From time to time and, at any time to establish any Local<br />
Boards for managing any of the affairs of the Company in any specified locality<br />
in India or elsewhere and to appoint any persons tgo be members of such local<br />
boards, and to fix their remuneration.<br />
(19) At any time And from time to time by power of attorney under<br />
the Seal of the Company, to appoint any person or persons to be the Attorney or<br />
Attorneys of the Company, for such purposes and with such powers, authorities<br />
and discretion, (not exceeding those vested in or exercisable by the Board under<br />
these presents and excluding the powers which may, under the Act or these<br />
Articles, be exercised only by the Board) and for such period and subject to such<br />
conditions as the Board may from time to time think fit, and any such<br />
appointment may, (if the Board think fit), be made in favour of the Members or<br />
any of the Members of any Local Board, established as aforesaid or in favour of<br />
the Company, or the shareholders, directors, nominees, or managers of any<br />
company or firm or otherwise in favour of any fluctuating body of persons<br />
whether nominated directly or indirectly by the Board and any such Power of<br />
Attorney may contain such powers for the protection or convenience of persons<br />
dealing with such Attorneys, as the Board may think fit, and may contain powers<br />
enabling any such delegates or attorneys as aforesaid to sub-delegate all or any of<br />
the powers, authorities and discretions for the time being vested in them.<br />
(20) Subject to Sections 294, 297, 300 and other applicable<br />
provisions of the Act and the Articles for or in relation to any of the matters<br />
aforesaid or otherwise for the purpose of the Company, to enter into all such<br />
negotiations and contracts and rescind and vary all such contracts, and<br />
execute and do all such acts, deeds and things, in the name and on behalf of<br />
the Company as they may consider expedient, or in relation to any of the<br />
matters aforesaid or otherwise for the purposes of the Company.<br />
(21) From time to time to make, vary and repeal by-laws for the<br />
regulation of the business of the Company, its officers and servants.<br />
MANAGEMENT<br />
Prohibition<br />
of<br />
almultaneous<br />
appointment of different<br />
categories of managerial<br />
personnel.<br />
154. The Company shall not appoint or employ at the same time more than<br />
one of the following categories of managerial personnel, namely :<br />
(a) Managing Director.<br />
(b) Manager.<br />
THE SECRETARY<br />
Secretary 155. The Directors shall from time to time appoint a Secretary, and, at their<br />
discretion remove any such Secretary, to perform any functions which by the Act<br />
are to be performed by the Secretary and to execute any other ministerial or<br />
administrative duties, which may from time to time be assigned to the Secretary<br />
by the Directors. The Directors may also appoint at any time any person or<br />
persons (who need not be the Secretary) to keep the Registers required to be kept<br />
by the Company.<br />
THE SEAL<br />
The Seal, its custody and<br />
use.<br />
156. (a) The Board shall provide a common seal for the purposes of the<br />
Company, and shall have power from time to time to destroy the same and<br />
substitute a new Seal in lieu thereof, and the Board shall provide for the safe<br />
278
custody of the Seal for the time being, and the Seal shall never be used except by<br />
the authority of the Board or a Committee of the Board previously given.<br />
(b) The Company shall also be at liberty to have an official Seal in<br />
accordance with Section 50 of the Act for use in any territory, district or place<br />
outside India.<br />
Deeds how executed. 157. Every Deed or other instrument to which the Seal of the Company is<br />
required to be affixed, shall unless the same is executed by a duly constituted<br />
attorney, be signed by one Director and the Secretary or some other person<br />
appointed by the Board for the purpose. Provided that in respect of Shares<br />
Certificate(s) the Seal be affixed in accordance with Article 20.<br />
Division of profits. 158. The profits of the Company, subject to the any special rights relating<br />
thereto created or authorised to be created by the Memorandum or these Articles<br />
and subject to the provisions of these Articles, shall be divisible among the<br />
Members in proportion to the amount of capital paid-up or credited as paid-up on<br />
the shares held by them respectively.<br />
The Company in General<br />
Meeting may declares a<br />
dividend.<br />
Dividend to be paid only<br />
out of profits.<br />
159. The Company in General Meeting may declare dividends, to be paid to<br />
the Members according to their respective rights but no dividends shall exceed the<br />
amount recommended by the Board, but the Company in General Meeting may<br />
declare a smaller dividend.<br />
160. (a) No dividend shall be declared or paid otherwise, by the Company for<br />
any financial year out of profits for that year arrived at after providing for<br />
depreciation in accordance with the provisions of Section 205 of the Act except<br />
after the transfer to reserves of the Company of such percentage of its profits for<br />
that year as may be prescribed, or out of the profits of the Company for any<br />
previous financial year or years arrived at after providing for depreciation in<br />
accordance with those provisions and remaining undistributed or out of both<br />
Provided that :<br />
(i)<br />
(ii)<br />
If the Company has not provided for depreciation for any previous<br />
financial year or years it shall, before declaring or paying a dividend<br />
for any financial year or years it shall, provide for such depreciation<br />
out of the profits of that financial year or out of the profits of any<br />
other previous financial year or years.<br />
if the Company has incurred any loss in any previous financial year<br />
or years, the amount of the loss or an amount which is equal to the<br />
amount provided for depreciation for that year or those years,<br />
whichever is less, shall be set off against the profits of the Company<br />
for the year for which the dividend is proposed to be declared or paid<br />
or against the profits of the Company for any previous financial year<br />
or years arrived at in both cases after providing for depreciation in<br />
accordance with the provisions of sub-section (2) of Section 205 of<br />
the Act or against both.<br />
PROVIDED FURTHER that, no dividend shall be declared or paid for<br />
any financial year out of the profits of the Company for that year arrived at after<br />
providing for depreciation as above, except after the transfer to the reserves of the<br />
Company of such percentage of its profits for that year as may be prescribed in<br />
accordance with Section 205 of the Act or such higher percentage of its profits as<br />
may be allowed in accordance with that Section .<br />
(b) The declaration of the Board as to the amount of net profits<br />
shall be conclusive.<br />
Interim dividend. 161. The Board may from time to time, pay to the Members such interim<br />
dividends as in their judgement the position of the Company justifies.<br />
<strong>Capital</strong> paid up in<br />
advance at interest not to<br />
162. Where capital is paid in advance of calls, such capital may carry interest,<br />
but shall not in respect thereof confer a right to dividend or to participate in<br />
279
earn dividend.<br />
Dividends in proportion<br />
to amount paid up.<br />
Retention in certain<br />
cases.<br />
Dividend etc. to jointholders.<br />
No Member to receive<br />
dividend whilst indebted<br />
to the Company’s right of<br />
reimbursement thereof.<br />
Transfer of shares must<br />
be registered.<br />
profits.<br />
163. All dividends shall be apportioned and paid proportionately to the<br />
amounts paid or credited as paid on the shares during any portion or portions of<br />
the period in respect of which the dividend is paid; but if any share is issued on<br />
terms providing that it shall rank for dividend as from a particular date, such share<br />
shall rank for dividend accordingly.<br />
164. The Directors may retain the dividends payable upon shares in respect of<br />
which any person is under the Transmission Article (Article 63) entitled to<br />
become a member, or which any person under that Article is entitled to transfer<br />
until such person become a member in respect thereof or shall duly transfer the<br />
same.<br />
165. Any one of several persons who are registered as the joint-holders of any<br />
share may give effectual receipts for all dividends or bonus and payments on<br />
account of dividends or bonus or sale proceeds of fractional certificates or other<br />
moneys payable in respect of such shares.<br />
166. Subject to provisions of the Act, no Member shall be entitled to receive<br />
payment of any interest or dividends in respect of his share or shares, whilst any<br />
money may be due or owing from him to the Company in respect of such share or<br />
shares or otherwise howsoever, either alone or jointly with any other person or<br />
persons; and the Board may deduct from the interest or dividend payable to any<br />
Member all sums of money so due from him to the Company.<br />
167. A transfer of shares shall not pass the right to any dividend declared<br />
thereon before the registration of the transfer.<br />
Dividends how remitted 168. Unless otherwise directed any dividend may be paid by cheques or<br />
warrant or by a payslip or receipt having the force of a cheque or warrant sent<br />
through post to the registered address of the Member or person entitled or in case<br />
of joint-holders to that one of them first named in the Register of Members in<br />
respect of the joint-holding. The Company shall not be liable or responsible for<br />
any cheque or warrant or payslip or receipt lost in transmission or for any<br />
dividend lost to the Member or person entitled thereto by the forged endorsement<br />
of any cheque or warrant or the forged signature on any payslip or receipt or the<br />
fraudulent recovery of the dividend by any other means. If two or more persons<br />
are registered as joint-holders of any share or shares anyone of them can give<br />
effectual receipts for any moneys payable in respect thereof. Several executors or<br />
administrators of a deceased Member in whose sole name any share stands, shall<br />
for the purpose of this clause be deemed to be joint-holders thereof.<br />
Unclaimed Dividend. 169. (a) If the Company has declared a dividend but which has not been paid<br />
or a dividend warrant in respect thereof has not been paid within 42 days from the<br />
date of declaration to any shareholder entitled to the payment of the dividend the<br />
Company shall within 7 days from the date of the expiry of the said period of 42<br />
days open a special account in that behalf in any scheduled bank called “the<br />
unpaid dividend account of Indian Organic Chemicals Limited.”<br />
(b) Any money transferred to the unpaid dividend account of the<br />
Company which remains unpaid or unclaimed for a period of three years from the<br />
date of such transfer, shall be transferred by the Company to the general revenue<br />
account of the Central Government. A claim to any money so transferred to the<br />
general revenue account may be preferred to the Central Government by the<br />
shareholders to whom the money is due.<br />
No interest on dividends. 170. No unpaid dividend shall bear interest as against the Company.<br />
Dividend and call<br />
together.<br />
171. Any General Meeting declaring a dividend may on the recommendation<br />
of the Board make a call on the members of such amount as the Meeting fixes, but<br />
so that the call on each Member shall not exceed the dividend payable to him, and<br />
so that the call be made payable at the same time as the dividend; and the<br />
dividend may, if so arranged between the Company and the Members, be set off<br />
against the calls.<br />
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<strong>Capital</strong>isation 172. (a) The Company in General Meeting may resolve that any moneys,<br />
investments or other assets forming part of the undivided profits of the Company<br />
or sanding to the credit of the General Reserve, Reserve or any Reserve Fund or<br />
any other Fund of the Company, the <strong>Capital</strong> Redemption Reserve Account, or in<br />
the hands of the Company and available for dividend, or representing premiums<br />
received on the issue of shares and standing to the credit of the Share Premium<br />
Account, be capitalized and distributed amongst such of the shareholders or any<br />
class of shareholders as would be entitled to receive the same if distributed by<br />
way of dividend in accordance with their respective rights and interests and in<br />
proportion to the amount of capital paid up on shares held by them respectively,<br />
on the footing that they become entitled thereto as capital and that all or any part<br />
of such capitalized fund be applied on behalf of such shareholders in paying up in<br />
full either at par or at such premium as the resolution may provide, any unissued<br />
shares of the Company or debentures of the Company which shall be distributed<br />
accordingly, or in or towards payment of the whole or part of the uncalled liability<br />
on any issued shares and that such distribution or payment shall be accepted by<br />
such shareholders in full satisfaction of their interest in the said capitalized sum.<br />
Provided that a Share Premium Account and a <strong>Capital</strong> Redemption Reserve<br />
Account may, for the purpose of this Article, only be applied in the paying up of<br />
unissued shares to be issued to Members of the Company as fully paid bonus<br />
shares.<br />
(b) Subject to the provision of Section 205 of the Act, a General<br />
Meeting may resolve that any surplus moneys arising from the realization of any<br />
capital assets of the Company, or any investments representing the same, or any<br />
other undistributed profits of the Company not subject to charge for Income-tax,<br />
be distributed among the Members on the footing that they receive the same as<br />
capital.<br />
(c) For the purpose of giving effect to any resolution under the<br />
preceding paragraphs of this Article, the Board may settle any difficulty which<br />
may arise in regard the distribution as it thinks expedient and in particular may<br />
issue fractional certificates and may fix the value for distribution of any specific<br />
assets and may determine that such cash payments shall be made to any Members<br />
upon the footing of the value so fixed or that fractions of less value than Rupees<br />
ten may be disregarded in order to adjust the rights of all parties and may vest any<br />
such cash, share, debenture or other specific assets in trustees upon such trusts for<br />
the persons entitled to the dividend or capitalized fund as may seem expedient to<br />
the Board and generally may make such arrangement for the acceptance,<br />
allotment and sale of such shares, debentures and fractional certificates or<br />
otherwise as they may think fit. Where requisite, a proper contract shall be<br />
delivered to the Registrar for registration in accordance with Section 75 of the Act<br />
and the Board may appoint any person to sign such contract on behalf of the<br />
person entitled to the dividend or capitalized fund and such appointment shall be<br />
effective.<br />
ACCOUNTS<br />
Board to keep true<br />
accounts<br />
173. (a) The Company shall keep at its office or at such other place in India<br />
as the Board thinks fit proper books of Accounts in accordance with Section 209<br />
of the Act with respect to -<br />
(i) all sums of money received and expended by the Company<br />
and the matters in respect of which the receipt and<br />
expenditure taken place;<br />
(ii)<br />
(iii)<br />
all sales and purchases of goods by the Company.<br />
the assets and liabilities of the Company.<br />
(b) Where the Board decides to keep all or any of the books of account<br />
at any place other than the Office of the company, the Company shall within<br />
seven days of the decision file with the Registrar, a notice in writing giving the<br />
full address of that other place.<br />
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(c) The Company shall preserve in good order the books of account<br />
relating to a period of not less than eight years preceding the current year together<br />
with the vouchers relevant to any entry in such books of account.<br />
(d) Where the Company has a branch office, whether in or outside<br />
India, the Company shall be deemed to have complied with this Article of proper<br />
books of account relating to the transactions effected at the branch office are kept<br />
at the branch office and proper summarized returns made upto dates at intervals of<br />
not more than three months, are sent by the branch office to the Company at its<br />
office or at the other place in India, at which the Company’s books of account are<br />
kept as aforesaid.<br />
(e) The books of accounts shall give a true and fair view of the state of<br />
affairs of the Company or branch office, as the case may be, and explain its<br />
transactions and shall be open to inspection by any Director during business<br />
hours.<br />
As to inspection of<br />
accounts or books by<br />
Members<br />
Statement of accounts to<br />
be furnished to General<br />
Meeting.<br />
Copies/Statements to be<br />
sent to each Member<br />
174. The Board shall from time to time determine whether and to what extent<br />
and at what times and places and under what conditions or regulations the<br />
accounts and books of the Company or any of them shall be open to the inspection<br />
of Members, not being Directors, and no member, (not being a Director), shall<br />
have any right of inspecting any account or books or documents of the Company<br />
except as conferred by law or authorised by the Board.<br />
175. The Board shall from time to time, in accordance with Sections 210, 211,<br />
212, 215, 216 and 217 of the Act, cause to be prepared to be laid before the<br />
Company in General Meeting, the Balance Sheet, Profit and Loss Accounts and<br />
Reports as are required by the said Sections shall comply with.<br />
176. (a) A copy of every such Profit and Loss Account and Balance Sheet<br />
(including Auditor’s Report and every other document required by law to be<br />
annexed or attached to the Balance Sheet) shall, at least twenty-one days before<br />
the meeting at which the same are to be laid before the members, be sent to the<br />
members of the Company, to every trustee for the holders of any Debentures<br />
issued by the Company (whether such member or trustee is or is not entitled to<br />
have notice of general meetings of the Company sent to him), and to all persons<br />
other than such Members or trustees, being persons so entitled. Provided that the<br />
documents aforesaid shall not be required to be sent if copies thereof are made<br />
available for inspection at the Company’s Registered office during working hours<br />
for a period of twenty-one days before the date of the aforesaid meeting and a<br />
Statement, containing the salient features of such documents in the prescribed<br />
form or copies of the documents aforesaid, as the Company may deem fit, is sent<br />
to every Member of the Company and to every trustee for the holders of any<br />
debentures issued by the Company, not less than twenty-one days before the date<br />
of the said meeting.<br />
(b) Any member or holder of Debentures of the Company and any<br />
person from whom the Company has accepted a sum of money by way of deposit,<br />
shall, on demand, be entitled to be furnished free of cost, with a copy of the last<br />
Balance Sheet of the Company and of every document required by law to be<br />
annexed or attached thereto, including the Profit and Loss Account and the<br />
Auditors Report.<br />
AUDIT<br />
Accounts to be audited 177. Auditors shall be appointed and their rights and duties regulated in<br />
accordance with Sections 224 to 233 of the Act.<br />
DOCUMENTS AND NOTICE<br />
Service of docu-ments or<br />
notices on Members by<br />
Company<br />
178. (1) A document or notice may be given or served by the Company to or<br />
on any member whether having his registered address within or outside India<br />
either personally or by sending it by post to him to his registered address.<br />
(2) Where a document or notice is sent y post, service of the documents<br />
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or notice shall be deemed to be effected by properly addressing, preparing and<br />
posting a letter containing the document or notice, provided that where a Member<br />
has intimated to the Company in advance that documents or notice should be sent<br />
to him under a certificate of posting or by registered post with or without<br />
acknowledgment due or by cable or telegram and has deposited with the<br />
Company a sum sufficient to defray the expenses of doing so, service of the<br />
document or notice shall not be deemed to be effected unless it is sent in the<br />
manner intimated by the Member. Such service shall be deemed to have been<br />
effected in the case of a notice of a meeting, at the expiration of forty-eight hours<br />
after the letter containing the document or notice is posted or after telegram has<br />
been dispatched and in any other case, at the time at which the letter would be<br />
delivered in the ordinary course of the post or the cable or telegram would be<br />
transmitted in the ordinary course.<br />
By Advertisement (3) A documents or notice advertised in a newspaper circulating in the<br />
neighborhood of the Office shall be deemed to be duly served or sent on the day<br />
on which the advertisement appears on or to every member who has no registered<br />
address in India and has not supplied to the Company an address within India for<br />
the serving of documents on or the sending of notice to him.<br />
On Joint holders. 179. A document or notice may be given or served by the Company to or on<br />
the joint-holders of a share by giving or serving the document or notice to or on<br />
the joint-holder named first in the Register of Members in respect of the share.<br />
On<br />
personal<br />
representatives etc.<br />
To whom documents or<br />
notices must be served or<br />
given.<br />
Members bound by<br />
documents or notices<br />
served on or given to<br />
previous holders.<br />
180. A documents or notice may be given or served by the Company to or on<br />
the persons entitled to a share in consequence of the death or insolvency of a<br />
Member by sending it through the post in a prepaid letter addressed to them by<br />
name or by the title of representatives of the deceased, or assignee of the insolvent<br />
or by any like description, at the address (if any), in India supplied for the purpose<br />
by the persons claiming to be so entitled, or, (until such an address has been so<br />
supplied), by serving the document or notice in any manner in which the same<br />
might have been given if the death or insolvency had not occurred.<br />
181. documents or notices of every General Meeting shall be served or given<br />
in some manner hereinbefore authorised on or to (a) every Member, (b) every<br />
person entitled to a share in consequence of the death or insolvency of a Member,<br />
and (c) the Auditor or Auditors for the time being of the Company.<br />
182. Every person, who by operation of law, transfer or other means<br />
whatsoever, shall become entitled to any share, shall be bound by every document<br />
or notice in respect of such share, which previous to his name and address being<br />
entered on the Register of Members, shall have been duly served on or given to<br />
the person from whom he derives his title to such share.<br />
183. Any document or notice to be given or served by the Company may be<br />
signed by a Director or the Secretary or some person duly authorised by the Board<br />
for such purpose and the signature thereto may be written, printed, Photostat or<br />
lithographed.<br />
WINDING-UP<br />
Distribution of assets in<br />
specie.<br />
184. (a) If the Company shall be wound up, the liquidator may with the<br />
sanction of a special resolution of the company and any other<br />
sanction required by the Act, divide amongst the members in spcie<br />
or kind the whole or any part of the assets of the Company, whether<br />
they shall consist of property of the same kind or not.<br />
(b) For the purpose aforesaid, the liquidator may set such value as he<br />
deems fair upon any property to be divided as aforesaid and may<br />
determine how such division shall be carried out as between the<br />
members or different classes of members.<br />
(c) The liquidator may, with the like sanction, vest the whole or any<br />
part of such assets in trustees upon such rusts for the benefits of the<br />
contributories as the liquidator, with the like sanction shall think fit,<br />
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ut so that no member shall be compelled to accept any shares or<br />
other securities whereon there is any liability.<br />
Service of document or<br />
notice by Member<br />
185. All documents or notices to be given or served by Members on or to the<br />
Company or to any officer thereof, shall be served or given by sending the same<br />
to the Company or Officer at the Office by post under a certificate of posting or<br />
by registered post, or by leaving it at the office.<br />
INDEMNITY<br />
Indemnity 186. Subject to the provisions of Section 201 of the Act, every Director,<br />
manager and other officer or servant of the Company shall be indemnified by the<br />
Company against, and it shall be the duty of Directors out of the funds of the<br />
Company to pay, all costs, losses and expenses which any such officer or servant<br />
may incur or become liable or by reason of any contract enter into or any act or<br />
thing done by him as such officer or servant or in any way in the discharge of his<br />
duties including expenses, and in particular, and so as not to limit the generality of<br />
the foregoing provisions against all liabilities incurred by him as such Director,<br />
manager, officer or servant in defending any proceedings, whether civil or<br />
criminal, in which judgement is given in his favour or he is acquitted, or in<br />
connection with any application under Section 633 of the Act, in which relief is<br />
granted by the Court, and the amount for which such indemnity is provided shall<br />
immediately attach as a lien on the property of the Company.<br />
INDEMNITY AND RESPONSIBILITY<br />
Not responsible for acts<br />
of others<br />
187. Subject to the provisions of Section 201 of the Act, no Director,<br />
Managing Director, or other Officer of the Company shall be liable for the acts,<br />
receipts, neglects, or defaults of any other Director or Officer, or for joining in<br />
any receipt or other act for conformity, or for any loss or expenses happening to<br />
the Company through insufficiency or deficiency of the title to any property<br />
acquired by order of the Board for or on behalf of the Company, or for the<br />
insufficiency or deficiency of any security in or upon which any of the moneys of<br />
the Company shall be invested, o for any loss or damages arising from the<br />
bankruptcy, insolvency or tortuous act of any person, company or corporation<br />
with whom any moneys, securities or effects shall entrusted or deposited, or for<br />
any loss occasioned by any error of judgement or oversight on his part, or for any<br />
other loss or damages or misfortune whatever which shall happen in the execution<br />
of the duties of his office or in relation thereto, unless the same happens through<br />
his own dishonesty.<br />
SECRECY CLAUSE<br />
Secrecy clause 188. (a) Every Director, Manager, auditor, treasurer, trustee, member of a<br />
committee, officer, servant, agent, accountant, or other person employed in the<br />
business of the Company shall, if so required by the Board, before entering upon<br />
his duties, sign a declaration pledging himself to observe a strict secrecy<br />
respecting all secret processes or other secret technical information of any nature<br />
whatsoever, transactions and affairs of the Company with the customers and the<br />
state of the accounts with individuals and in matters relating thereto, and shall by<br />
such declaration pledge himself not to reveal any of the matters which may come<br />
to his knowledge in the discharge of his duties except when required so to do by<br />
the Board or by law or by the person to whom such mattes relate and except so far<br />
as may be necessary in order to comply with any of the provisions in these<br />
presents contained.<br />
(b) No Member shall be entitled to visit or inspect any works of the<br />
Company without the permission of the Board or the Managing Director or to<br />
require discovery of or any information respecting any detail of the Company’s<br />
trading, or any matter which may relate to the conduct of the business of the<br />
Company and which in the opinion of the Board, it would be inexpedient in the<br />
interest of the Company to disclose.<br />
************<br />
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SECTION IX – OTHER INFORMATION<br />
MATERIAL CONTRACTS AND DOCUMENTS FOR INSPECTION<br />
The following contracts (not being contracts entered in to in the ordinary course of business carried on by our<br />
Company or entered into more than two years before the date of the Draft Letter of Offer) which are or may be<br />
deemed material have been entered or are to be entered in to by our Company. These contracts and also the<br />
documents for inspection referred to hereunder, may be inspected at the Registered Office of our Company<br />
situated at Paragon Condominium, 3 rd Floor, Pandurang Budhkar Marg, Mumbai – 400 013from 10.00 a.m. to<br />
1.00 p.m., from the date of the Draft Letter of Offer until the date of closure of the Subscription List on all<br />
working days except Saturdays, Sundays and Public holidays.<br />
A) MATERIAL CONTRACTS<br />
1. Engagement Letter dated January 10, 2008 received from the Company <strong>IDBI</strong> <strong>Capital</strong> Market Services<br />
Limited to act as Lead Manager to the Issue.<br />
2. Memorandum of Understanding dated June 30, 2008 entered into with <strong>IDBI</strong> <strong>Capital</strong> Market Services<br />
Limited as Lead Manager to the Issue.<br />
3. Memorandum of Understanding dated June 17, 2008 entered into with Satellite Corporate Services<br />
Private Limited entered into as the Registrar to the Issue<br />
B) DOCUMENTS<br />
4. Memorandum and Articles of Association of our Company.<br />
5. Certificate of Incorporation of our Company dated bearing Registration no. 11579, dated February 10,<br />
1960.<br />
6. Fresh Certificate of Incorporation of our Company bearing Registration no. 11-11579, dated November<br />
05, 2002<br />
7. Copy of the resolution passed at the meeting of the Board of Directors held on May 30, 2008 approving<br />
this Issue.<br />
8. Consents of the Directors, Company Secretary, Auditors, Lead Manager to the Issue, Bankers to the<br />
Issue, Legal Advisors to the Issue and Registrar to the Issue, to include their names in the Draft Letter of<br />
Offer to act in their respective capacities.<br />
9. The Report of the Auditors, N.M. Raiji & Co, dated June 10, 2008 for the financial years endied on<br />
March 31, 2008, March 31, 2007, March 31, 2006, March 31, 2005 and March 31, 2004.<br />
10. Annual Reports of our Company for the Financial Years ended on March 31, 2008, March 31, 2007,<br />
March 31, 2006, March 31, 2005and March 31, 2004.<br />
11. Copies of the initial listing application made to the Stock Exchange for listing of equity shares in this<br />
Issue.<br />
12. In-principle approval from Bombay Stock Exchange Limited vide letter dated [●].<br />
13. Letter No. [●] dated [●] issued by the Securities and Exchange Board of India for the Issue.<br />
14. Due Diligence Certificate dated July 17, 2007 from <strong>IDBI</strong> <strong>Capital</strong> Market Services Limited<br />
15. Resolutions passed at Annual General Meeting held on September 28, 2004 for appointment of Mr.<br />
Shyam Bhupatirai Ghia as Chairman and Managing Director and Mr. Mukund Dharamdas Dalal as the<br />
Joint Managing Director of our Company, and agreement entered into by each of them with our Company<br />
dated March 31, 2004 in the aforesaid context.<br />
16. Tripartite Agreement dated March 24, 2005 entered into with NSDL and the Registrar, to establish direct<br />
connectivity with the Depository.<br />
17. Agreement dated March 03, 2005 entered into with CDSL and the Registrar to establish direct<br />
connectivity with the Depository.<br />
18. Scheme of Arrangement, order of High Court at Bombay dated July 04, 2008 sanctioning the Scheme of<br />
Arrangement and proof of filing of the same with the RoC on July 15, 2008.<br />
19. RBI letter No. FE.CO.FID/1494/11.01.020(XXX) 2008-09 dated July 16, 2008.<br />
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DECLARATION<br />
286