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CHEMCEL BIO-TECH LIMITED
15TH ANNUAL REPORT
2009-10
2
CHEMCEL BIO-TECH LIMITED
15TH ANNUAL REPORT
CONTENTS: P. No. 1. Notice 4 2. Directors’ Report 8 3. Management’s Discussion and Analysis 12 4. Report on Corporate Governance 15
5. Auditors’ Report 28 6. Standalone Balance Sheet, P&L, Schedules, Notes to Accounts. 38
7. Cash Flow Statement. 49
8. Abstract of Balance Sheet as per Schedule VI. 51
9. Statement pursuant to Section 212 of the Companies Act, 1956 52
10. Directors’ Report, Auditors’ Report,
Financials of M/s Jetro Petro Biotech Private Limited 53
11. Auditors Report on Consolidated Accounts 66 12. Consolidated financials 75 13. Attendance Slip & Proxy Form 87
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CHEMCEL BIO-TECH LIMITED 15TH ANNUAL GENERAL MEETING BOARD OF DIRECTORS
Shri K. Balakrishna Rao - Director Shri K. T. Vijay Kumar - Managing Director Shri K. C. S. Prasad - Director – Production Shri Ch.V.Varaprasad Rao - Executive Director Shri P. Narasimha Murthy - Independent Director Shri K. Sri Hari Rao - Independent Director Shri D. Sankar - Independent Director
AUDIT COMMITTEE Shri D Shankar - Chairman Shri P. Narasimha Murthy - Member Shri K. Sri Hari Rao - Member REMUNERATION COMMITTEE Shri D Shankar - Chairman Shri P. Narasimha Murthy - Member Shri K. Sri Hari Rao - Member COMPANY SECRETAR - S.Rahmatullah REGISTERED OFFICE: CHEMCEL BIO-TECH LIMITED #. 16-130/12, JRD TATA Industrial Estate Auto Nagar, 3rd Cross Road Extension Kanuru, Vijayawada – 520 007. Ph: (0866) 2544996’ Fax: (0866) 2545437; 2545243 E-mail: [email protected] AUDITORS: T. Nehru, Chartered Accountant # 59-4-2/2, 3RD Cross, Ashok Nagar, Mogalrajpuram Vijayawada- 520010 BANKERS: Corporation Bank D.No.40-9-76/B, Avr Arcade, Sai Nagar, Benz Circle, Vijayawada, Andhra Pradesh - 520008 Kotak Mahendra Bank Limited 40-1-48/1, M.G.Road, Labbipet Vijayawada-520010 SHARE AND DEPOSITORY TRANSFER AGENTS M/s. Bigshare Services Private Limited E 2/3, Ansa Industrial Estate, Saki vihar road Sakinaka, Andheri (east), Mumbai-72 LISTING OF EQUITY SHARES: - Bombay Stock Exchange Limited (BSE)-Mumbai
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NOTICE
Notice is hereby given that the 15th Annual General Meeting of the members of M/s Chemcel Biotech Limited will be held on Friday, the 24th day of September 2010 at 4.00 PM at ‘Siver Spoon Conference Hall’, 59A-8-12B, Gurunanak Colony Road, Teachers colony, Vijayawada 520 008 to transact the following items of business:
ORDINARY BUSINESS
1. To Receive, Consider and Adopt the Audited Balance Sheet as at 31st March 2010 and the Profit and
Loss Account for the year ended 31st March 2010, together with the reports of the Directors and Auditors’ thereon.
2. To appoint a Director in the place of Shri K. Balakrishna Rao, who retires by rotation and being eligible
offers him self for re-appointment. 3. To appoint a Director in the place of Mr. D. Shankar who retires by rotation and being eligible offers
himself for re-appointment. 4. To appoint Shri.T.Nehru, Chartered Accountant, Vijayawada as Statutory Auditor of the company
to hold office from conclusion of this Annual General Meeting till conclusion of the next Annual General Meeting and author i ze Board of Directors of the company to fix the remuneration.
SPECIAL BUSINESS 5. To appoint Shri. Ch. V. Varaprasad Rao as Director
To consider and if thought fit, to pass, with or without modification, the following resolution as an Ordinary Resolution:
“RESOLVED THAT Shri. Ch. V. Varaprasad Rao, who was appointed as an Additional Director of the Company pursuant to Section 260 and other applicable provisions of the Companies Act, 1956 and who holds office up to the date of this Annual General Meeting and in respect of whom the Company has received a notice under Section 257 of the Companies Act, 1956 from a member, in writing, proposing his candidature for the office of Director, be and is hereby appointed as a Director of the Company whose office is liable to retire by rotation.
6. To ratify the appointment of Shri. Ch.V.Varaprasad Rao who was appointed as an Executive Director.
To consider and if thought fit, to pass, with or without modification, the following resolution as an Special Resolution
“RESOLVED THAT pursuant to the provisions of Sections 198, 269, 309, 310& 311, Schedule XIII and all other applicable provisions if any of the Companies Act, 1956, the consent of the Company be and is hereby accorded to ratify the appointment of Shri. Ch. V. Varaprasad Rao as Wholetime Director designated as Executive Director of the Company with effect from 31.01.2010 for a period of 2 years at the following remuneration package:
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i) Salary: Rs.45,000/- per month
ii) Perquisites: In addition to salary ,Shri. Ch. V. Varaprasad Rao is entitled to the following perquisites, classified into three categories
CATEGORY (A)
1.Housing
Rent free furnished accommodation value not exceeding@ 15% of the salary over and above Ten percent of the salary payable by Ch. V. Varaprasad Rao or House Rent Allowance @ 15% of the salary
2.Medical Reimbursement
1-month salary per annum for self and family
3.Leave Travel Concession
For self and family, value not exceeding one month salary per annum
4.Club Fees
Fees of clubs shall be reimbursed subject to a maximum of two clubs. Admission fee or life member fee shall not be reimbursable.
5.Insurance
Insurance and/or Accident Insurance, premium not to exceed half month Basic Salary.
Explanation
Family means the spouse, dependent children and dependent parents for the above purpose
CATEGORY (B)
1.Company’s contribution for provident Fund, Superannuating Fund, Annuity Fund to the extent not taxable either singly or put together as per Income-Tax Act,1961.
2.Gratutity is payable at a rate not exceeding Half Month salary for each completed year of service and
3.Encashment of earned leave at the rate of 30 days per annum at the end of the tenure.
The above will not be included in the computation of the ceiling on perquisites.
CATEGORY C
1.Provision for car with driver for use on Company’s business and mobile phone and telephone at residence and reimbursement of expenditure incurred on traveling, entertainment, etc. These will not be considered as perquisites.
2.Use of car for private purposes and personal long distance calls on telephone will be billed by the Company.
Not withstanding anything contained herein above, wherein any financial year during the currency of tenure of the Executive Director, the Company has no profits or its profits are inadequate, it may still pay as remuneration by way of salary, perquisites any other allowances not exceeding the ceiling as specified in schedule XIII ,as minimum remuneration in addition to the following perquisites which shall not be included in the computation of the ceiling of remuneration specified herein above.
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a.) Contribution to Provident Fund, Superannuating Fund or Annuity Fund to the extent these either singly or put together are not taxable under the Income-Tax Act,1961.
b) Gratuity is payable at a rate not exceeding Half Month salary for each completed year of service and
c) Encashment of earned leave at the end of the tenure.
By order of the Board of Directors
Sd/- Place: Vijayawada K. T.Vijaya Kumar Date : 09.08.2010 Managing Director
Notes:
1. A MEMBER ENTITLED TO ATTEND AND VOTE AT THE MEETING IS ENTITLED TO APPOINT A PROXY TO ATTEND THE MEETING AND VOTE INSTEAD OF HIMSELF. THE PROXY NEED NOT BE A MEMBER OF THE COMPANY. THE INSTRUMENT APPOINTING PROXY SHOULD HOWEVER BE DEPOSITED AT THE REGISTERED OFFICE OF THE COMPANY NOT LESS THAN 48 HOURS BEFORE THE COMMENCEMENT OF THE MEETING.
2. Register of members of the Company and Share Transfer Books will remain closed from Monday,
the 20th day of September 2010 to Friday, the 24th day of September 2010 (both days inclusive).
3. Members are requested to notify immediately any change in their address to the share transfer agents and incase their shares are held in dematerialized form, this information should be passed on to their respective depositary participants with out delay.
4. Members who have multiple accounts are requested to intimate to the company, the folios of such
accounts, to enable the company to consolidate all their share holdings in to one account.
5. Members who hold shares in dematerialized form are requested to bring their client ID and DP IDs for easier identification of attendance at the meeting.
6. Pursuant to the requirements of the listing agreement of stock exchanges, the information of the
directors proposed to be appointed or Re-appointed is given in the annexure to the notice.
7. Members/proxies are requested to bring their copies of Annual Report and the attendance slip duly filled in for attending the meeting. Copies of the Annual Reports will not be provided at the meeting.
8. Members desiring any information as regards accounts are requested to write to the Company at
least seven days before the date of the meeting to enable the management to keep the information ready at the meeting.
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ANNEXURE TO THE NOTICE - EXPLANATORY STATEMENT
(Pursuant to Section 173(2) of Companies Act, 1956)
Item No 5:
Shri Ch.V.Varaprasad Rao was appointed as an additional director by the Board with effect from 31st January 2010.
In terms of Section 260 of The Companies Act, 1956 and Articles of Association, Shri Ch.V.VaraprasadRao holds office as Director only till the date of the forthcoming Annual General Meeting. Notice has been received from member as required by Section 257 of the Act, signifying his intention to propose the candidature of Shri Ch.V.Varaprasad Rao for the office of Director.
Shri Ch.V.Varaprasad Rao, aged about 58 years, is a qualified B.Sc., and is well versed in the fields of Administration and HR. He is not a director in any other Company incorporated in India. He holds 100 equity shares of the Company in his name as on 31st March 2010.
None of the Directors other than Shri Ch.V.Varaprasad Rao is interested in the respective Resolution. Item No 6:
Shri Ch.V.Varaprasad Rao, Additional Director was appointed as a Whole time Director designated as Executive director of the Company in the Board Meeting held on 31st January, 2010.
Shri Ch.V.Varaprasad Rao, aged 58 years is well versed in the fields of Administration and HR and is not a director in any other Companies.
The Board appointed Sri Ch.V.Vara Prasad Rao as Whole time Director designated as Executive Director subject to approval of shareholders for a period of two years effective from 31.01.2010. As per the provisions of Section 198,269, 309,310,311 read with Schedule XIII approval of shareholders is required for appointment and fixation of remuneration to the Wholetime Director. Hence the resolution is recommended.
None of the Directors other than Shri Ch.V.Varaprasad Rao is interested in the respective Resolution. By order of the Board of Directors Sd/- Place: Vijayawada K.T Vijaya Kumar Date : 09.08.2010 Managing Director
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DIRECTORS’ REPORT
Dear Members M/s Chemcel Bio-tech Limited Your Directors are pleased to present herewith the Fifteenth Annual Report on the business and operations of the Company together with Audited Statement of Accounts for the year ended 31st March 2010. The highlights for the year under review are follows: -
1. FINANCIAL INFORMATION: The performance of the Company during the period under review is summarized below: -
(RS.IN LAKHS) PARTICULARS 2009-10 2008-09 Net Sales 4576.40 3518.78 Other Income - - Interest and Financial charges 98.90 116.25 Depreciation 8.88 9.50 Profit/(Loss) before taxes 178.52 175.19 Provision for taxes 41.40 43.88 Profit / (Loss) carried to Balance Sheet 137.12 131.31
During the year under review, your Company has achieved a gross turnover of of Rs. 4545.43Lacs as against Rs. 3528.89 Lacs in 2008-09. The Operational performance of the Company is discussed under Management Discussion and Analysis Report.
2. DIVIDEND
Your Directors considered it prudent to conserve the resources of the Company to sustain its future growth and as such have not recommended any dividend for the current financial year. Your Directors have proposed to transfer an amount of Rs.14705425/- to the General Reserve out of the profits of the company for the year 2009-10.
3. STATUS OF IMPLEMENTATION OF PROJECT
Initially the cause for farmers prefering to go for Jatropha plantation is that it can be grown in non-agricultural lands which are left uncultivated due to poor soil conditions and non-availability of water sources. But now, as the Government of Andhra Pradesh as also other states have started constructing several dams across the Perennial rivers to prevent the wastage of water by allowing it to go into sea, the water thus stored is being diverted to uncultivated lands. Most of the areas relating to uncultivated lands are marked for Cultivation. Thus, the prospects of the farmers being very promising with land value having gone up by several times, has boosted their morale who are more inclined to grow Commercial crops like Paddy, Chillis etc., besides Plantations like Banana, Orange and other Citrus fruits. As they have started working by developing the lands in this direction which is of more remunerative when compared to Jatropha cultivation, there is an escalation of cost of production due to non availability of jatropa seeds. Hence, the prospects of hoping for more Jatropha Plantations are bleak. While at the same time the Bio diesel, (Petro Diesel) production is not improving to the expected levels due to non-availability of Jatropha Seed, the primary in-put to Bio Diesel manufacturing. The scanty availability has
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caused an excess demand which has resulted in the steep rise of seed price ranging between Rs.10 to 12 per Kg as against a maximum price of Rs.6/- per Kg at the time of our planning to go for this product through Public issue during year 2008-09 . This has resulted in escalation of cost of production which is not economical for the growth of the Company. Meanwhile, as an alternative, your directors are contemplating the propects of importing Bio crude oil from Countries like Malaysia and other African countries where the Crude is available in surplus. Already few manufacturers started importing Bio crude oil and are in the process of transesterfication to produce Bio-Diesel as cost of imports is much cheaper when compared to the present cost of oil extracted from seeds . In view of the above situation, as also taking into cognizance, the views expressed by our subsidiary company ,M/s Jetro Petro Bio tech Private Limited, it is worthwhile to consider the following proposals and seek the approval from share holders of the company in this Annual General Meeting:-
1. Recovery of the amount advanced to farmers through our Subsudiary M/s.Jetro Petro Biotech Private Limited.
2. Advise to the machinery supplier to expediate the dispatch of modified machinery, ie. Transecterfication plant in the first instance.
3. Starting off trading operations of Bio diesel form available sources so as to develop a good marketing network and start our own outlets before commencing our manufacture.
4. installation of esterfication Plant at the earliest and completion before 31.03.2011.
4. CONSOLIDATED FINANCIAL STATEMENTS:
Yours Directors have pleasure in attaching the consolidated financial statements pursuant to Clause 41 of the Listing Agreement entered into with the Stock Exchange. These statements were prepared in accordance with the Accounting Standard 21 prescribed by the Institute of Chartered Accountants of India in this regard. The company has no branches. The Auditors’ Report to the Board of Directors does not contain any qualifications.
5. FIXED DEPOSITS The Company has not accepted any fixed deposits from the public within the meaning of section 58A of the Companies Act, 1956.
6. SUBSIDIARY COMPANY:
The statement pursuant to Section 212 of the Companies Act, 1956, containing details of subsidiary of the Company forms part of the Annual Report. The name of the Subsidiary Company is “Jetro Petro Biotech Private Limited”.
7. STATUTORY DISCLOSURES:
CONSERVATION OF ENERGY AND TECHNOLOGY
ABSORPTION:
In view of the nature of activities that are being carried on by your Company, Rules 2A and 2B of the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988, concerning conservation of energy and technology absorption, respectively are not applicable to your Company. Your company is being a manufacturer of pesticides and insecticides requires minimal energy consumption and every endeavor has been made to ensure the optimal use of energy, avoid wastage and conserve as far as possible.
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FOREING EXCHANGE EARNINGS AND OUTGOINGS
Rs. In Lakhs
1. Total Foreign Exchange earned Nil
2. Total Foreign Exchange utilized Nil
RESEARCH AND DEVELOPMENT During the year No amount was spent as Capital / Recurring Expenses towards the Research and Development
8. DIRECTORS
• In accordance with the requirements of the Companies Act, 1956 and the Articles of Association of the Company, Shri K.Balakrishna Rao and Shri D.Shankar Directors retire by rotation and being eligible offer themselves for re-appointment.
• Shri Ch.V.Varaprasad Rao was appointed as an Additional Director of the company with effect from
31st January 2010, who holds office till the date of Annual General Meeting. Shri.Ch.V.Varaprasad Rao was also appointed as Wholetime Director of the Company in Board meeting held on 31st January 2010. The Board Recommends for his appointment.
9. AUDITORS
Sri T. Nehru, Chartered Accountant, Vijayawada, the Statutory Auditor of the Company , retires at the ensuing Annual General Meeting and being eligible, has offered himself for re-appointment.
10. AUDIT COMMITTEE
In accordance with Clause 49 of the Listing Agreement, the company has constituted an Audit Committee, which consists of Three Independent and Non Executive Directors of the company Viz. Mr D.Shankar, Mr P.Narasimha Murthy and Dr K.Srihari Rao. The Audit committee functions in terms of the role and powers delegated by the Board of Directors keeping in view of the Provisions of Clause 49 of Listing Agreement and Section 292A of the Companies Act 1956.
11. PARTICULARS OF EMPLOYEES
There are no employees in the organization coming under the provisions of section 217(2A) of the Companies Act, 1956 read with the Companies (Particulars of Employees) Rules, 1975 as amended.
12. DIRECTOR’S RESPONSIBILITY STATEMENT
In accordance with sub-section (2AA) of section 217 of the Companies Act, 1956, the Directors of the Company state:
a. That in the preparation of the accounts for the financial year ended 31st March 2010, the applicable
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accounting standards have been followed along with proper explanation relating to material departures.
b. That the Directors have selected such accounting policies and applied them consistently and
made judgments and estimates that were reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for the year under review.
c. That the Directors have taken proper and sufficient care for the maintenance of adequate
accounting records in accordance with the provisions of the Companies Act, 1956 for safe guarding the assets of the Company and for preventing and detecting fraud and other irregularities.
d. That the Directors have prepared the accounts for the financial year ended 31st March 2010 on a
‘going concern basis’.
13. CORPORATE GOVERNANCE
A separate report on corporate governance along with Auditor’s Certificate on its compliance is attached to this report.
14. MANAGEMENT DISCUSSION AND ANALYSIS REPORT A Separate Report of Management Discussion and Analysis as required under the Provisions of listing agreement attached to this report.
15. ACKNOWLEDGEMENTS:
Your Directors wish to express their appreciation for the cooperation and continued support received from the Company’s Bankers. Your Director’s also take this opportunity to place on record their appreciation for the dedicated services rendered by the executives, managers, officers, employees and workers for the dedication and sense of commitment shown by the employees at all levels and their contribution towards the performance of the Company.
By Order of the Board
Sd/- Place: VIJAYAWADA K.Balakrishna Rao Date: 09.08.2010 Chairman
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11. Management Discussion and Analysis Report
a. Industry Over view: As we slowly emerge from the global recession of 2007-09, the agrochemicals and bio-diesels industry finds itself passing through a profound transformation. There is a global focus on the generic markets of agrochemicals as an opportunity of being a contract manufacturer to serve large MNC’s. While the agrochemicals industry is seasonal in nature dependent on the overrule performance of the agricultural sector, the Bio-diesels is slated for a huge growth due to the limited availability and surging prices of petroleum. Bio-fuels are going to play an extremely important role in meeting India’s energy needs. The country's energy demand is expected to grow at an annual rate of 4.8 per cent over the next couple of decades.
With the ever-
escalating crude oil prices, bio diesel is gaining acceptance worldwide as a good substitute. As of now, the industry is in the incubation stage with the Government of India’s plan for bio diesel development and commercialization formulated by the Planning Commission. The implementation of the project consists of two phases. In Phase I, which was carried out between 2003-2007, involving the development of Jatropha oilseeds plantations. Phase II will consist of a self sustaining expansion of the programme leading to the production of bio diesel. In spite of the growing awareness in public, the availability is not upto the requirement. This is the reason for growing Demand of Fossile fuels. While at the same time the Bio diesel, (Petro Diesel) production is not improving to the expected levels due to non-availability of Jatropha Seed, the primary in-put to Bio Diesel manufacturing. The scanty availability has caused an excess demand which has resulted in the steep rise of seed price ranging between Rs.10 to 12 per Kg as against a maximum price of Rs.6/- per Kg at the time of our planning to go for this product through Public issue during year 2008-09 . This has resulted in escalation of cost of production which is not economical for the growth of the Company. Reasons for low progress in cultivation of Jatropha seeds: The primary cause of farmers prefering to go for Jatropha plantation is that it can be grown in non-agricultural lands which are left uncultivated due to poor soil conditions and non-availability of water sources. But now,as the Government of Andhra Pradesh as also other states have started constructing several dams across the Perennial rivers to prevent the wastage of water by allowing it to go into sea, the water thus stored is being diverted to uncultivated lands. Most of the areas relating to uncultivated lands are marked for Cultivation. Thus, the prospects of the farmers being very promising with land value having gone up by several times, has boosted their morale who are more inclined to grow Commercial crops like Paddy, Chillis etc., besides Plantations like Banana, Orange and other Citrus fruits. As they have started working by developing the lands in this direction which is of more remunerative when compared to Jatropha cultivation, there is an escalation of cost of production dure to non availability of jatropa seeds Hence, the prospects of hoping for more Jatropha Plantations are bleak. Meanwhile, as an alternative, your directors are contemplating the propects of importing Bio crude oil from Countries like Malaysia and other African countries where the Crude is available in surplus. Already few manufacturers started importing Bio crude oil and are in the process of transesterfication to produce Bio-Diesel as cost of imports is much cheaper when compared to the present cost of oil extracted from seeds . In view of the above situatiojn, as also taking into cognizance, the views expressed by our subsidiary company ,M/s Jetro Petro Bio tech Private Limited, it is worthwhile to consider the following proposals and seek the approval from share holders of the company in this Annual General Meeting:-
5. Recovery of the amount advanced to farmers through our Subsudiary M/s.Jetro Petro Biotech Private Limited.
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6. Advise to the machinery supplier to expediate the dispatch of modified machinery, ie. Transecterfication plant in the first instance.
7. Starting off trading operations of Bio disel form available sources so as to develop a good marketing network and start our own outlets before commencing our manufacture.
8. installation of esterfication Plant at the earliest and completion before 31.03.2011. b. Company Profile The Company being promoted by experienced professionals having associated with the agro chemicals industry for over three decades, is a premier manufacturer engaged in the manufacturing of agro-chemicals and production of bio – diesel, an alternative fuel, which is derived from Jatropha seed for the bio diesel sector. The company’s main products are in three forms viz., Liquids, granules and dusts. The Company is engaged in the manufacturing of agro-chemicals.
The Company’s Registered office and factory are located in their own premises at Tata Industrial estate, Kanuru, Vijayawada, The total area of the plot of land is about 1849.02 sq.yards. The Company has two RCC buildings with 3 floors in each building constructed on the plot and all the necessary plant & Machinery & other infrastructure.
c. Opportunities
It is estimated by the Government that Sales, primarily in the form of low-level bio diesel blends, will exceed Five million Kiloliters per year. Which implies that the biofuels industry will grow by more than 100 percent over the next five years,While the performance of agrochemicals is expected to be good due to sufficient rainfall . The management estimates that with an upward long term bias in price of crude oil, bio-diesel will emerge as a very strong and economical alternative while agrochemicals performance will be as per expectations. d. Threats, Risks & Concerns
The success of the Bio diesel and agro chemicals is dependent on the policy and the blending norms to be fixed by the Government from time to time. Thus the biggest hurdle for the sector is the amount of support the Government is willing to provide to the industry. As of now, the government is working towards withdrawl of several cumbersome procedures of the past which is a healthy sign for the industry. Initiatives have to certainly come from Government of India and State governments and the chemical industry can not progress on the initiatives of private sector and industrial houses alone.
e. Segment Wise Performance:
The Company is involved in manufacture of Agro Chemicals. It is also involved in the production of bio-fertilizers. As the Company is yet to commence its regular business in bio-diesels, segment wise analysis of performance is not required.
f. Outlook However, the difficulties ahead of us should not stop us from putting efforts. There is a huge market potential for agrochemicals and biofuels industries in India. We believe that the Government from time to time would announce policies and will support a significant and stable market. Further strengthening of the policy guidelines, hastening the policy implementation, initiatives by the state governments, will help us in achieving our mission.
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g. Discussion on financial performance with respect to operational performance During the year under review the Company has achieved a turnover of Rs.4576.40 lakhs as against Rs. 3518.78 Lakhs in the previous year registering a rise of 30% during the year the Company has earned a Net Profit of Rs. 137.28 Lakhs as against Rs.133.51 Lakhs in the previous year. The Company has made a provision of Rs.41.23 Lakhs for income tax, a provision of Rs.0.16 Lakhs as fringe benefit tax for the year under consideration. An amount of Rs.147.05 Lakhs from the profits were made to the General Reserve. The Earning per share (EPS) of the Company as on 31.03.2010 was Rs0.53/- as against Rs.0.51/- in the previous year. h. Material developments in Human Resources/Industrial Relations front
The Company recognizes the importance and contribution of its employees to the growth and development of the Company. The Company continued to maintain cordial relations with employees and staff.
Cautionary Statement
Statements in the management discussion and analysis describing the Company’s objectives, projections, estimates, expectations may be considered to be forward looking statements and actual results could differ materially from those expressed or implied. Factors which could make a significant difference to the Company’s operations include demand supply conditions, market prices, input component costs and availability, changes in government regulations and tax laws besides other factors such as litigation, over which the Company may not have any control.
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REPORT ON CORPORATE GOVERNANCE (Pursuant to clause 49 of the Listing Agreement with the Stock Exchange)
1. A brief statement on Company’s philosophy on code of governance
Your Company is committed to the highest level of transparency, in all aspects of its operations and interaction with its shareholders. This report on Corporate Governance is to fulfill this commitment.
The Company believes that good Corporate Governance practices should be enshrined in all activities of the Company. This would ensure efficient conduct of affairs of the Company and help the company to achieve goal of maximizing value for all its stakeholders. Your Company’s business objective is to create value that can be sustained over the long term for consumers, shareholders, employees & business partners. Your Company is conscious of the fact that the success of a company is a reflection of the professional conduct and ethical values of its management & employees. Your Company affirms its commitment to follow good corporate governance practices proactively.
This Chapter of the report, plus the information given under ‘Management Discussion and Analysis’ and ‘Shareholder Information’ constitutes the report on Corporate Governance for the year 2009-2010.
2. Board Of Directors:
(i) The Company has Three Promoter Directors & and Four Independent Directors. Chairman is Promoter Non executive Director, The composition of Independent Directors is More than fifty percent and is in compliance with Clause 49 of the Listing Agreement entered with the Stock Exchange.
(ii) None of the Directors on the Board is a member of more than 10 committees or Chairman of more
than 5 committees across all the companies in which he is a Director. The Directors have made necessary disclosures regarding committee positions in other public companies as at 31st March 2010.
(iii) The names and categories of the Directors on the Board, their attendance at Board Meetings
during the year and at the last Annual General Meeting as also the number of directorships and committee memberships held by them in other companies are given below:
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Name Category
No. Of Board
Meetings during the
Year 2009-10
Whether attended last AGM held on 30th
September 2009
No. Of Director ships in other Public
companies
No. Of Committee
positions held in other public companies
Held
Attended
Chairman Member
K Balakrishna Rao Promoter, Non-Executive Chairman
8 8 Yes 01 0 0
K T Vijaya Kumar Promoter, Managing Director
8 8 Yes Nil 0 0
K C S Prasad Promoter, Whole Time Director
8 6 Yes Nil 0 0
Ch.V.Vara Prasad Rao*
Executive Director
8 1 No Nil 0 0
P Narasimha Murthy Independent Non Executive Director
8 6 Yes Nil 0 0
K Sri Hari Rao Independent Non Executive Director
8 8 Yes Nil 0 0
D Sankar Independent Non Executive Director
8 4 Yes Nil 0 0
* Shri Ch.V.Vara Prasad has been appointed as additional Director by the Board of Directors at their meeting held on 31st January 2010. (i) Eight (8) Board Meetings were held during the year 2009-10 and the gap between 2 meetings
did not exceed 4 months. The dates on which the Board Meetings held were 27.04.2009, 27.06.2009, 30.07.2009, 19.08.2009, 31.10.2009, 24.12.2009 31.01.2010 and 06.03.2010
(ii) Apart from receiving the sitting fees, Non-Executive Directors do not have any other material pecuniary relationship or transactions with the Company, its promoters or its Management, which in the opinion of the Board may affect independence of judgment of the Director.
(iii) Necessary information as mentioned in Annexure 1A to Clause 49 of the Listing Agreement
has been placed before the Board for their consideration. 3. Audit Committee (i) The Audit Committee of the Company is constituted in line with the provisions of Clause 49
of the Listing Agreement with the Stock Exchange read with Section 292 A of the Companies Act 1956.
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(ii) The Company’s Audit Committee comprises of the following Directors all of whom are Non-
Executive Independent Directors:
1. D Sankar - Chairman 2. K Sri Hari Rao - Member 3. P Narasimha Murthy - Member
(iii) The terms of reference stipulated by the Board to the Audit Committee includes review of the
following: a. Management discussion and analysis of financial condition and results of operations; b. Statement of significant related party transactions (as defined by the audit committee), submitted
by management; c. Management letters / letters of internal control weaknesses issued by the statutory auditors; d. Internal audit reports relating to internal control weaknesses; e. The appointment, removal and terms of remuneration of the Chief internal auditor shall be subject
to review by the Audit Committee f. Oversight of the Company’s financial reporting process and the disclosure of its financial
information to ensure that the financial statement is correct, sufficient and credible. g. Recommending to the Board, the appointment, re-appointment and, if required, the replacement or
removal of the statutory auditor and the fixation of audit fees. h. Approval of payment to statutory auditors for any other services rendered by the statutory
auditors. i. Reviewing, with the management, the annual financial statements before submission to the board
for approval, with particular reference to. j. Matters required being included in the Director’s Responsibility Statement to be included in the
Board’s report in terms of clause (2AA) of section 217 of the Companies Act, 1956. k. Changes, if any, in accounting policies and practices and reasons for the same. l. Major accounting entries involving estimates based on the exercise of judgment by management. m. Significant adjustments made in the financial statements arising out of audit findings. n. Compliance with listing and other legal requirements relating to financial statements. o. Disclosure of any related party transactions. p. Qualifications in the draft audit report. q. Reviewing, with the management, the quarterly financial statements before submission to the
board for approval r. Reviewing, with the management, performance of statutory and internal auditors, adequacy of the
internal control systems. s. Reviewing the adequacy of internal audit function, if any, including the structure of the internal
audit department, staffing and seniority of the official heading the department, reporting structure coverage and frequency of internal audit.
t. Discussion with internal auditors any significant findings and follow up there on. u. Reviewing the findings of any internal investigations by the internal auditors into matters where
there is suspected fraud or irregularity or a failure of internal control systems of a material nature and reporting the matter to the board.
v. Discussion with statutory auditors before the audit commences, about the nature and scope of audit as well as post-audit discussion to ascertain any area of concern.
w. To look into the reasons for substantial defaults in the payment to the depositors, debenture holders, shareholders (in case of non payment of declared dividends) and creditors.
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The Company continued to derive immense benefit from the deliberations of the Audit Committee .
(iv) During the year 2009-10 the Audit Committee met four times on 27.06.2009, 30.07.2009, 31.10.2009
and 31.01.2010 the statutory auditors and whole-time directors were invited for the meetings. The Company Secretary acts as the secretary of the Audit Committee. The attendance of the members of the committee are given below:
Name Category No. of Meetings during the Year 2009-10 Held Attended
Mr. K. Sri Hari Rao Independent, Non-Executive Director
4 4
Mr. D. Sankar Independent, Non Executive Director
4 3
Mr.P Narasimha Murthy
Independent, Non Executive Director
4 3
4. Remuneration Committee The Company had constituted a Remuneration Committee in terms of Schedule XIII of the Companies Act, 1956 read with clause 49 of the listing agreement. The committee comprises of Sri.D.Sankar, Sri.P.Narasimha Murthy and Sri.K.Hari Rao, all non- executive Independent Directors. The broad terms of reference of the remuneration committee are to approve/recommend to the Board the salary (including annual increments) perquisites and commission including pension rights & any compensation payment to be paid to the Company’s Managing / Whole-Time-Director’s. Remuneration policy: The Company while deciding the remuneration package of the management takes into consideration the employment scenario, remuneration package of the industry, financial performance of the Company and talents of the appointee. The Executive Directors and Non- Independent Directors of the Company are not entitled to sitting fees. The Non Executive Independent Directors are not paid any remuneration except sitting fees for attending Board/ Committee meetings. The Committee has access to all records of the Company During the year 2009-10 the Committee met One time on 31st January 2010 ,the details of the committee members are as follows:
Name Category No. of Meetings during the Year 2009-10 Held Attended
Mr. K. Sri Hari Rao Independent, Non-Executive Director
1 1
Mr. D. Sankar Independent, Non Executive Director
1 1
Mr.P Narasimha Murthy
Independent, Non Executive Director
1 1
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5. Remuneration Of Directors
Details of remuneration/sitting fees paid to the Directors for the year 2009-10 are given below. (Amount in Rs.)
Name Sitting Fee Rs.
Salary, perquisites and allowances Rs.
Relationship with other Directors
Sri K Balakrishna Rao Nil 3,98,456 * Sri K T Vijaya Kumar Nil 11,07,27
9 *
Sri K C S Prasad Nil 8,77,632 * Sri Ch.V Vara Prasad Rao Nil 1,03,500 None Sri P Narasimha Murthy Rs.6000 N.A None Sri K Sri Hari Rao Rs. 7500 N.A None Sri D Sankar Rs.3000 N.A None
No pecuniary relationship exists between the Company and its Non – Executive Directors except for the sitting Fees as mentioned above. None of the directors is related to any of the Directors of the Company except Mr.K.T.Vijay Kumar, Brother of Mr. K. Bala Krishna Rao, Chairman of the Company and Mr. K.C.S.Prasad, Son of Mr.K.Bala Krishna Rao, Chairman of the Company The period of appointment of Managing Director and Whole Time Directors of the Company is for period of 2 years. The Company does not have any stock option plan or performance incentives. Details of Shares of the Company held by the Directors as on March 31, 2010 are as below:
Name No.of Shares Sri K Balakrishna Rao 1155136 Sri K T Vijaya Kumar 3768169 Sri K C S Prasad 1092642 Sri P Narasimha Murthy 2000 Sri K Sri Hari Rao Nil Sri D Sankar Nil CH.V.Vara Prasad 100
6. Share Transfer & Investor’s Grievance Committee
This committee comprises of 3 members Sri. K T Vijaya Kumar, Sri.K.C.S.Prasad and Sri.K.Hari Rao. The Chairman of the Committee is Shri K Sri Hari Rao. The committee looks into transfer and transmission, issue of duplicate share certificate, consolidation and sub-division of shares and investors grievance. The committee oversees the performance of the Registrars and Transfer agents and recommends measures for overall improvement in the quality of investor services. Sri Shaik Rahmathullah, Company Secretary is designated as Compliance Officer of the Company. The committee met 4 times during the year 2009-10 on 30.06.09; 31.07.09; 31.10.09; 31.01.10 Attendance at the committee meetings was as under:
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Name of the Member No.of Meetings attended
Mr. K T Vijaya Kumar 4 Mr K C S Prasad 3 Mr. K Sri Hari Rao 4
There was no investor Complaints Pending /outstanding as on 31st March 2010
7. General Body Meetings
Location & Time of Last 3 Annual General Meetings
Year Venue Date Time 2008-09 Silver Spoon Meeting
Hall,59A-8-12B,Gurunanak Colony Road,Teacher’s Colony,Vijayawada-520008
25.09.2009 4.00 P.M.
2007-2008 16-130/12, JRD Tata Industrial Estate, Auto Nagar, Kanuru, Vijayawada – 520 007.
08.08.2008 11.30 A M
2006-2007 Hotel Ilapuram, Gandhi Nagar Vijayawada
14.09.2007 11.00 AM
b) During the year none of the resolutions had been passed through postal ballot.
8. Disclosures During the year 2009-10 the Company had no materially significant related party transactions, which is considered to have potential conflict with the interest of the Company at large. The disclosures as to related party transactions is disclosed in the notes to accounts. There were no instances of non-compliance, penalties, strictures imposed on the Company by the stock exchanges, SEBI or any other statutory authority on any matter relating to the capital markets during the financial year.
9. Means Of Communication The quarterly/half yearly/annual results, notices of Board Meetings/ General Meetings and all other material information are normally published by the Company in Andhra Bhoomi and Financial Express or Deccan Chronicle. The half-yearly results are not sent to the shareholders. The Company currently has a website: www.chemcelbiotechltd.com. Official news releases are sent to the stock exchange at Mumbai where the shares of the Company are listed. The Company files the quarterly results, annual report and other information pursuant to clause 51 of the listing agreement on the Electronic Data Information and Filing Retrieval (EDIFAR) website maintained by National Information Center (NIC).
21
10. Management Discussion and Analysis report Information on management discussion and analysis has placed elsewhere in the Annual Report
11. Non-Mandatory Requirements
As regards adoption of Non-Mandatory requirement of Corporate Governance.It is submitted that the Company does not send the half yearly results to eachof the shareholders
12. General Shareholders Information
a. 15th Annual General Meeting Date and Time :24th September 2010 at 4.00 P.M. Venue : Siver Spoon Conference Hall’,
59A-8-12B, Gurunanak Colony Road,Teachers colony,
Vijayawada 520 008 b. Financial Calendar (tentative) Financial Year : 1st April to 31st March First Quarter Results : July 2010 Second Quarter and Half yearly results : October 2010 Third Quarter Results : January 2010 Last Quarter Results / Audited Results : April 2011/June 2011 c. Dates of Book closure : Monday, the 20th September 2010 to
Friday, the24th September 2010 d. Dividend payment date : Not applicable e. Listing on Stock Exchanges : The Bombay Stock Exchange Limited, Mumbai Stock Code : 533026 ISIN Numbers in NSDL & CDSL for Equity Shares : INE213J01012
The Company has paid its annual listing fees to the stock exchange for the financial year 2009-10 f. Market Price Data : High/Low price quotation in each Month of the last financial year 2009-10 on the Stock Exchange, Mumbai is given below.
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Month High (Rs.)
Low (Rs.)
Apr’09 7.48 5.77 May’09 7.70 5.37 June’09 9.00 6.50 July’09 7.94 5.50 Aug’09 7.33 5.82 Sep’09 8.87 6.21 Oct’ 09 13.15 7.00 Nov’ 09 11.47 9.60 Dec’ 09 12.25 9.55 Jan’ 10 12.19 9.04 Feb’ 10 10.08 7.96 Mar’ 10 9.49 7.95
Source: www.bseindia.com
Registrars and Transfer Agents (RTA): M/s. Bigshare Services Private Limited,
E -2/3, Ansa Industrial Estate, Saki Vihar Road, Saki Naka,
Andheri (East), Mumbai – 400072. E-mail: [email protected]
13. Share Transfer System In pursuance of SEBI notification No.D&CC/FITTC/CIR-15/2002 dated 27th December 2002, the Company had appointed M/s. Bigshare Services Private Limited as single agency for share registry work. Share transfers and communications regarding share certificates, change of address, etc., must be forwarded to the RTA. The R & T Agent process the physical Share Transfers and the Shares sent for physical transfers are generally registered within a period of 15 days from the date of receipt, if all the documents are clear in all respects. All Share Transfers are approved by the Share Transfer Committee, which meets every fortnight. All requests for Dematerialization of shares are processed and the confirmation is given to the respective Depositories, i.e, National Securities Depository Limited (NSDL) and Central Depository Services (India) Limited (CDSL), within 15 days of receipt.
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14. Shareholding Pattern As On 31st March 2010
Company No. of Shares held
Shareholding %
Promoters 6179176 23.84 Financial Institutions - - Mutual Funds - - Insurance Companies - - Foreign Institutional Investors
30806 0.12
Corporate Bodies 5388076 20.78 Indian Public 12669655 48.88 NRIs 323097 1.26 Clearing Members 1327596 5.12 Total: 2,59,18,406 100.00
15. DISTRIBUTION OF SHAREHOLDING AS ON 31ST MARCH 2010
Shareholding Class
No.of Shareholders
No. of Shares held
Shareholding %
Up to 500 2572 770399 2.9724 501 to 1000 1042 887733 3.4251 1001 to 2000 719 1121010 4.3252 2001 to 3000 221 579539 2.236 3001 to 4000 286 1017335 3.9251 4001 to 5000 148 723951 2.7932 5001 to 10000 194 1586839 6.1224 10001 and above 258 19231600 74.2006 Total: 5440 2,59,18,406 100.00
16. De-Materialization Of Shares And Liquidity Trading in equity shares of the Company is permitted only in dematerialized form as per notification issued by SEBI. Dematerialization of shares are done through M/s. Bigshare Services Private Limited, and on an average the dematerialization process is completed within a period of 7 days from receipt of a valid demat request along with all documents. 64.62 % of the paid up capital has been dematerialized as on 31.03.2010.
17. Outstanding ADRs/GDRs/ Warrants or any convertible instruments, conversion
date and likely impact on equity : Not Applicable
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18. Secretarial Audit The Company gets the Secretarial Audit done by a Practicing Company Secretary for the purpose of reconciliation of the total admitted capital with both the depositories and the total issued and listed capital. The Secretarial Audit Report placed before the Board of Directors on a quarterly basis is also sent to the Stock Exchanges where the Company‘s shares are Listed.
19. Plant Locations : A. Agrochemical Unit
Door No. 16-130/12, JRD TATA Industrial Estate
Auto Nagar, 3rd Cross Road Extension, KANURU, VIJAYAWADA – 520 007 B. Bio Diesel Extraction Plant Plot No.260 A, IDA, Kondapalli, Near Vijayawada
20. Address for Correspondence
Sl.No. Shareholders Correspondence for Address to
1. Transfer/ Dematerialization/ consolidation/split of shares, issue of Duplicate share certificates, change of address of members and beneficial owners and any other query relating to the shares of the Company.
M/s.Bigshare Services Private Limited E -2/3, Ansa Industrial Estate, Saki Vihar Road Saki Naka, Andheri (East} Mumbai – 400072. e-mail: [email protected]
2. Investor Correspondence/ queries on Annual Report etc.
COMPANY SECRETARY Chemcel Bio-Tech Limited 16-130/12, JRD Tata Industrial Estate, Auto Nagar, Kanuru, Vijayawada – 520 007.
21. Nomination Facility
Shareholders holding shares in physical form and desirous of making a nomination in respect of their shareholding in the Company as permitted under Section 109A of the Companies Act, 1956 are requested to submit to the Registrars in the prescribed Form 2B for this purpose.
22. Company’s Policy On Prevention Of Insider Trading Pursuant to the requirements of SEBI (Prohibition of Insider Trading) Regulations, 1992, as amended, the Company had framed a Code of Conduct for prevention of insider trading. Mr.S.Rahamatulla Company Secretary had been appointed as the Compliance Officer for this purpose. The code is applicable to all such employees of the Company who are expected to have access to the unpublished price sensitive information relating to the Company and the same is being implemented as a self -regulatory mechanism. Date: 09.08.2010 By Order of the Board Place: Vijayawada. K.T.Vijaya Kumar Managing Director
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T.Nehru
Chartered Accountant
CERTIFICATE ON COMPLIANCE OF CONDITIONS OF CORPORATE GOVERNANCE
To The Members of Chemcel Biotech Limited
We have examined the compliance of the conditions of Corporate Governance by Chemcel Biotech Limited for the year ended 31st March 2010 as stipulated in Clause 49 of the Listing Agreements of the said company with Stock Exchanges in India.
The compliance of conditions of Corporate Governance is the responsibility of the management. Our examination was limited to a review of the procedures and implementations thereof adopted by the Company for ensuring the compliance of the conditions of Corporate Governance as stipulated in the said clause. It is neither an audit nor an expression of opinion on the financial statements of the Company.
In our opinion and to the best of our information and explanations given to us, we certify that the company has complied with the conditions of Corporate Governance as stipulated in the above mentioned listing agreements.
On the basis of representation received from Registrars and Share Transfer Agents and as per the records maintained by the Company which are presented to the Shareholders/Investors grievance committee, we state that during the year ended 31st March, 2010 no investor grievance was pending for a period exceeding one month. We further state that such compliance is neither an assurance as to the future viability of the Company nor the efficiency or effectiveness with which the management has conducted the affairs of the Company.
Place: Vijayawada T.NEHRU Date: 09.08.2010
CharteredAccountants M.No.15207
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Particulars of Directors seeking re-appointment at the forthcoming Annual General Meeting pursuant to Clause 49 of the Listing Agreement
Name of the Director
Qualification, Age & Expertise in Specific Functional Areas
Date of Birth
Qualification
List of the Companies in
which Directorships is held as on 31st March 2010
Chairman/Member of the
Committees of the Board of other Companies in which he is a Director as on 31st March, 2010
K.Balakrishna Rao
Postgraduate in Marketing- 72 yrs He has wide knowledge in Marketing, Production, Finance, and Company affairs.
04.03.1937
MBA Nil Nil
D.Shankar Chartered Accountant 63 years He has wide knowledge in Accounting, Taxation, Auditing and Company affairs.
09.10.1946
A.C.A Nil Nil
DECLARATION REGARDING COMPLIANCE BY BOARD MEMBERS AND SENIOR MANAGEMENT PERSONNEL WITH THE COMPANY’S CODE OF CONDUCT Pursuant to Circular No.SEBI/CFD/DIL/CG/1/2004/12/10 dated 29th October 2004, it is hereby declared that the Company has adopted a Code of Conduct for its Board Members and Senior Management Personnel. I hereby confirm that the Company has in respect of the financial year ended March 31, 2010, received from the senior management personnel of the Company and the Members of the Board a declaration of compliance with the Code of Conduct as applicable to them. Place: Vijayawada S.Rahamatullah Date: 09.08.2010 Company Secretary
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CERTIFICATE BY MANAGING DIRECTOR OF THE COPMANY
I, K.T.Vijaya Kumar, Managing Director, of M/s. Chemcel Bio-Tech Limited, hereby certify to the Board that
a) I have reviewed financial statements and the cash flow statement for the year and that to the best of
my knowledge and belief: These statements do not contain any materially untrue statement for the year or omit any material fact or contain statements that might be misleading:
(i) These statements together present a true and Fair view of the company’s Affairs is in the compliance with existing accounting standards, applicable laws and regulations.
b) There are, to the best of my knowledge and belief, no transactions entered in to by the company during the year which are fraudulent, illegal or violate of the company’s code of conduct
c) I am responsible for establishing and maintaining internal controls in the company and that we have evaluated the effectiveness of the internal control systems of the company and we have disclosed to the auditors, audit committee, deficiencies in the design or operations of internal controls, if any, of which we are aware and the steps we have taken or proposed to take rectify these deficiencies.
d) We have indicated to the auditors and the audit committee: (i) Significant changes in internal control during the year: (ii) Significant changes in accounting policies during the year and that the same have been
disclosed in the notes to the financial statements; and (iii) Instances of significant fraud of which they have become aware and the involvement therein,
if any, of the management or an employee having a significant role in the company’s internal control system.
e) We affirm that we have not denied any personnel access to the audit committee of the Company (in respect of matters involving alleged misconduct)
f) We further declare that all board members and designated senior management have performed compliance with the code of conduct for the current year. Place: Vijayawada Date 09.08.2010 (K T Vijaya Kumar) Managing Director
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T. NEHRU, B.Com., F.C.A 59-4-2/2, 3rd Cross, Ashok Nagar, Moghalrajpuram,
Vijayawada – 520 010. Ph. : 0866-2475826 Cell : 92464-72408
AUDITORS REPORT
To
The Members of CHEMCEL BIO-TECH LIMITED
1. We have audited the attached Balance sheet of CHEMCEL BIOTECH LIMITED as at 31st March, 2010 and related Profit and Loss account of the Company for the year ended on that date annexed thereto. These financial statements are the responsibility of the Company’s Management. Our responsibility is to express an opinion on these financial statements based on our audit.
2. We conducted our audit in accordance with accounting standards generally accepted in India. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material mis-statements. An audit includes examining on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by the management as well as evaluating the over all financial statements presentation. We believe that our audit provides a reasonable basis for our opinion.
3. As required by the Companies, (Auditor’s Report) Order 2003 issued by the Central Government in terms of Sub Section (4A) of Section 227 of the Companies Act, 1956, we enclose in the Annexure, a statement on the matters specified in the paragraphs 4 and 5 of the said Order.
4. Further to our comments in the annexure referred to above, we report that:
- We have obtained all the information and explanations, which to the best of our knowledge and belief were necessary for the purpose of our audit.
- In our opinion, proper books of accounts as required by law have been kept by the Company so far as appears from our examination of those books.
- The Profit and Loss account and Balance sheet dealt with by this report are in agreement with the books of accounts of the Company.
- In our opinion, the Profit & Loss account and Balance sheet comply with the accounting standards specified by the Institute of Chartered Accountants of India referred to in Section 211(3C) of the Companies Act, 1956.
29
- On the basis of written representations received from the Director’s as on 31.03.2010, and taken on record by the Board of directors, we report that none of the directors is disqualified as on 31.03.2010 from being appointed as Directors under Section 274(1) (g) of the Companies Act, 1956.
5. In our opinion and to the best of our information and according to the explanations given to us, the said accounts give the information required by the Companies Act, 1956 in the manner so required, and give a true and fair view in conformity with the accounting principles generally accepted in India.
a. In the case of Balance sheet, of the state of affairs of the Company as on 31st March, 2010. b. In the case of Profit & Loss account, of the Profit for the period ended on that date. c. In the case of Cash Flow Statement for the year ended on 31st March, 2010
Date :- 03.05.2010 T. NEHRU
Place :- Vijayawada Chartered Accountant
CP No. 15207
30
ANNEXURE TO THE AUDIT REPORT (Chemcel Biotech Ltd)
{Referred to in paragraph (3) of report of even date}
The Auditor’s report on the account of a Company to which this order applies shall include a statement on the following matters, namely:-
I.
a) The Company is maintaining proper records showing full particulars, including quantitative details and situation of fixed assets;
b) All fixed assets have been physically verified by the management at reasonable intervals; there is no material discrepancies noticed on such verification.
c) The Company has not disposed off any substantial part of fixed assets during this year.
II.
a) The physical verification of inventory has been conducted at reasonable intervals by the management;
b) The procedures of physical verification followed by the Management are reasonable and adequate in relation to the size of the company and the nature of its business. There are no inadequacies in such procedures.
c) The company is maintaining proper records of inventory and as informed to us, there is no material discrepancies noticed on physical verification.
III. a) The Company has not granted any loans, secured or unsecured to parties covered in the register maintained under section 301 of the Companies Act, 1956. Accordingly, Clause (iii)(b) to iii(d) of paragraph 4 of the Order are not applicable to the Company for the current year.
b) The Company has taken interest free loan of Rs. 1,55,63,000/- from Sri K. T. Vijay Kumar, the Managing Director of the Company, covered in the register maintained under section 301 of the Companies Act 1956.
c) The rate of interest and other terms and conditions on which the loans have been taken by the Company are not prima facie, prejudicial to the interest of the company.
IV. The company has an adequate internal control procedure commensurate with the size of the company and the nature of its business, for the purchase of inventory of fixed assets and for the size of goods. There is no accounting failure to correct major weaknesses in internal control.
V a) In our opinion and according to explanation and information given to us, the particulars of contracts or arrangements referred to in Section 301 of the Companies Act, 1956 have been so entered in the Register required to be maintained under this Section.
b) In our opinion and according to the information and explanations given to us, the transactions made in pursuance of such contracts or arrangements have been made at prices which are reasonable having regard to prevailing market prices at the relevant time.
VI. The Company has not accepted deposits from the public, as per the provisions of Sections 58A and 58AA of the Act and the rules framed there under.
VII. In our Opinion, the company has an internal audit system commensurate with its size and nature of its business.
31
VIII. According to information and explanations given to us the Central Government has not prescribed the maintenance of the cost records by the company under clause (d) of sub section (I) of 209 of Companies Act, 1956.
IX. a) The company is regular in depositing undisputed statutory dues including Provident Fund, Employees State Insurance, Cess and any other statutory dues within the time, with the appropriate authorities.
b) The Company is disputing the sales tax liability for an amount of Rs. 8,37,576/- and income tax liability of Rs. 36,40,723/-. Since the appeals are pending no provision has been made.
X. The company is a profit making company.
XI. The company has not defaulted in repayment of dues to a financial institution or bank. The company has not issued any debentures.
XII. The company has not granted loans and advances on the basis of security by way of
Pledge of shares.
XIII. The Company is not a Chit Fund / Nidhi / Mutual Benefit fund / society.
XIV According to the information and explanations given to us the Company is not dealing or trading in shares, Securities, Debentures and other Investments.
XV. The company has given guarantee for loans taken by others from Andhra Bank and the terms and conditions whereof are not prejudicial to the interest of the Company;
XVI. In our opinion the Term Loans availed by the Company during the year were, prime facie, applied for the purpose for which they were obtained.
XVII. The funds raised on short-term basis have been used for short-term investment and vice versa;
XVIII The Company has not made bonus allotment and right allotment to the party Covered in the Register maintained under section 301 of the Act.
XIX. The company has not issued any debentures.
XX. The company has not made public issue during this year. Hence the matter to be replied as per 4(XXIV) does not arrive.
XXI In our Opinion and according to the information given to us, no fraud on or by the Company has been noticed or reported during the year.
Date :- 03.05.2010 T .NEHRU
Place :- Vijayawada Chartered Accountant
CP No.15207
32
CHEMCEL BIOTECH LIMITED
SCHEDULE NO. 20 : NOTES ON ACCOUNTS
1. Basis of Accounting
The financial statements are prepared under the historical cost conventions on the basis of going concern as per applicable Indian Accounting standards and are based on the accrual basis accounting.
2. Revenue Recognition
Sales – Sales excludes Excise Duty, Cess, SHEC.
All expenses and income are accounted for on accrual basis as per the requirements of the Companies Act.
3. Fixed Assets Fixed Assets are recorded at Cost. Cost is purchase cost, and in the case of Land, includes development cost incurred, together with all incidental cost of acquisition, borrowing costs and other related internal costs. Fixed Assets are shown Gross Block Less Depreciation.
4. Depreciation Freehold land is not depreciated.
Other assets are depreciated on Written down value method in accordance with the rates prescribed in Schedule XIV to the Companies Act, 1956.
5. Impairment Loss The company assets at each Balance sheet date whether there is any indication that any asset may be impaired and if such indication exists, the carrying value of such asset is reduced to its recoverable amount and a provision would be made for such impairment loss in the profit and loss account, however there is no such type of asset during the year.
6. Retirement Benefits Contribution to Provident fund and gratuity provision are accounted on accrual basis.
7. Miscellaneous and Preliminary Expenses Miscellaneous expenses are written off as per Section 35(D) of Income Tax Act.
8. Deferred Tax Deferred tax is recognized on timing difference between taxable income and accounting income that originated in one period and are capable of reversal in one or more subsequent periods.
9. Capital Work in Progress:
The company has acquired additional land at Kondapalli and advance given for civil works and machinery to set up Bio Diesel process plant, which is shown separately as capital work in progress.
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10. Investments:
The company had taken 60 % stake in Jetro Petro Bio Tech Private Limited and invested Rs. 3 lakhs, it becomes holding company to Jetro Petro Biotech Private Limited. The investment is shown at cost.
11. Borrowing Costs
Borrowing costs attributable to the acquisition and construction of the Qualifying Assets, which takes substantial period of time to get ready for its intended use, are capitalized as part of the cost of respective assets up to the date when such asset is ready for its intended use. Other Borrowing costs are charged to the Profit and Loss account.
12. Valuation of Inventory
Inventories of Spares, consumables, and components are valued at lower of cost and net realizable value. Cost represents purchase cost and other incidental costs, if any. Cost of Inventories is computed on FIFO basis.
13. Micro/Small Scale Industries:
There are no dues to the Micro/Small Scale Industries. We are not having accounts with Micro/Small Scale Industries.
14. Subsidy
The Company opted to for the sales tax deferment scheme and the amount of sales tax payable to sales tax department is payable from the 14th year of deferment. The amount is shown as unsecured Loans and do not carry any interest.
15. Secured Loans & Securities:
Working Capital facility for an amount of Rs 6 Crores and inland credit of Rs. 2 Crores is obtained from Corporation Bank, Benz Circle Branch, Vijayawada by giving the following securities:
Hypothecation of stocks and receivables (less than six months) and personal guarantee of Managing Director Mr. K. T. Vijay Kumar & Chairman Mr. K. Balakirshna Rao.
The company has obtained Term Loan for an amount of Rs. 38.80 lakhs and Rs. 91.47 lakhs from Kotak Mahendra Bank Limited, Vijayawada by mortgaging Kondapalli site and personal guarantee of Directors.
The company has obtained mortgage loan of Rs. 65.00 lakhs from India Bulls against third party guarantee. The secured loan amount includes interest accrued there on as on date.
16. Confirmation Balances of Debtors / Creditors are yet to be obtained.
17. Contingent Liability/ Contingent Asset:
The disclosures required by Accounting Standard 29 “Provision, Contingent Liabilities, contingent Assets”, Company is disputing sales tax liability of Rs. 8,37,536/- and also income tax liability of Rs. 36,40,723/- for which no provision has been made as appeals are pending.
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18. Related party disclosure
Related party disclosures have been set out in a separate statement annexed to this schedule. The related parties, as defined by Accounting Standard 18 “Related Party Disclosure” issued by the Institute of Chartered Accountants of India, in respect of which the disclosures have been made, have been identified and taken on record by the Board.
Key Management Personnel
1. Sri K. Balakrishna Rao - Chairman 2. Sri K. T. Vijay Kumar - Managing Director 3. Sri K. C. S. Prasad - Director – Production 4. Sri Ch. V. Vara Prasad Rao - Executive Director.
Related Parties
Jetro Petro Biotech Private Limited- Subsidiary company
Transactions with other related parties
Nature of transaction Amount
Advance paid to Jetro Petro Biotech Ltd Rs. 5,52,92,783/- (paid towards supply of Jetropha seeds in terms of agreement)
Interest free unsecured loan received from Sri K. T. Vijay Kumar Rs. 1,55,63,000/-
The following transactions were carried out with Key Management Personnel and related parties in the ordinary course of business:
Transactions with Key Management Personnel
Particulars 2009-10 2008-09
Chairman 3,98,456 11,56,945
Managing Director 11,07,279 10,77608
Director – Production 8,77,682 9,04,360
Executive Director 1,03,500 -
Total: 24,86,917 31,38,914
Above includes Salary, Commission and perquisites.
35
18. Details of Quantitative information pursuant to para 3 & 4 C of Part II Schedule VI of the Companies Act, 1956:
The installed capacity is Liquids – 1000 KL, Granules – 1000 MT and Dusts – 300 MT.
Particulars in respect of production and sales
Particulars in respect of Sales for the year 2009-10 including Packing Material
19. Break-up for Repairs to Others:
Particulars Amount in Rs. Garden Maintenance 0
Office Maintenance 39396
Electrical Maintenance 1205
Total 40601
20. Particulars of Payments to Directors:
Designation Salary
(Rs.)
Commission
(Rs.)
Perquisites
(Rs.)
Total
(Rs.)
Managing Directors: -Mr. K. T. Vijay Kumar
8,97,000 1,80,935 29,344 11,07,279
Whole Time Directors
- Mr. K.Balakrishna Rao 3,22,000 60,311 16,145 3,98,456
- Mr. K.C.S. Prasad 6,90,000 1,80,935 6,697 8,77,632
- Mr. Ch.V.Vara Prasad Rao 1,03,500 - - 1,03,500
Grand Total 20,12,500 4,22,181 52,186 24,86,867
Class of Goods Production (Quantity)
Current Year Previous Year
Raw materials consumed 17,21,098 7,83,610
Packing material consumed 1,59,696 2,25,352
Quantity Value
Liquids - Lts 891076 298283078
Dusts - Kgs 728427 158260211
Granules- Kgs 38688 1096805
Total 1658191 457640094
36
The following is the computation of net profits of the company:
Net Profit before Tax as per Profit and Loss Account Rs. 1,78,52,315
Add : Commission to Directors Rs. 4,22,181
Profit before Commission Rs. 1,82,74,496
Commission payable to Chirman @ 1% of net profit (4 months) Rs. 60,311
Commission payable to Managing Director @ 1% of net profit Rs. 1,80,935
Commission payable to Production Director @ 1% of net profit Rs. 1,80,935
21. Particulars of payment to Auditors:
Particulars 2009-10
Rs.
2008-09
Rs.
i) Statutory Auditors 1,20,000 1,20,000
ii) Internal Auditors 40,000 40,000
iii) In other Capacity
- for Tax Audit
- for Certification & other matters
20,000
20,000
Total: 1,80,000 1,80,000
22. A. Expenditure in Foreign Currency:
Particulars 2009-10
Rs.
2008-09
Rs.
a) Travelling Expenses Nil Nil
b) Subscriptions and others Nil Nil
Total: Nil Nil
B. Earnings in Foreign Currency:
Particulars 2009-10
Rs.
2008-09
Rs.
Others Nil Nil
Total: Nil Nil
23. Balances due from / due to the Subsidiary Companies:
Particulars Balance as on 31.03.2010 Rs.
Balance as on 31.03.2009
Rs.
Maximum Balance during the year
Rs.
Jetro Petro Biotech Private Limited 5,52,92,783 5,46,85,284 5,52,92,783
37
Value of Imported materials consumed NIL
Value of Indigenous materials consumed 100%
Value of imports on CIF basis NIL
Value of Imported raw material, spare parts consumed NIL
Expenditure in foreign currency NIL
Earnings in foreign exchange on cash basis NIL
Figures of previous year have been re-grouped wherever necessary YES
Amount remitted during the year in Foreign Currency on account of
Dividends NIL
Earnings per share
Net Profit after tax Rs. 1,37,28,430
No. of Shares 2,59,18,406
Earning per Equity Share basic and diluted Rs. 0.53
FOR AND ON BEHALF OF BOARD T. NEHRU K.BALAKRISHNA RAO K.T.VIJAY KUMAR
Chartered Accountant Chairman Managing Director.
S. RAHMATULLAH Company Secretary Place: VIJAYAWADA Date : 03.05.2010
38
CHEMCEL BIOTECH LIMITED VIJAYAWADA
AUDITED BALANCE SHEET FOR THE YEAR 2010
PARTICULARS Sch. No.
31.03.2010 31.03.2009
I SOURCES OF FUNDS:
A Sahare Holders' Funds (a) Share Capital 1 259,184,060 259,184,060 (b) Reserves and Surplus 2 146,567,141 131,280,636
405,751,201 390,464,696 B Loan Funds
(a) Secured Loans 3 76,206,393 34,028,356 (b) Unsecured Loans 4 19,705,030 16,521,331
95,911,423 50,549,687
TOTAL: 501,662,624 441,014,383
II APPLICATION OF FUNDS
A Fixed Assets: (a) Gross Block 23,206,336 23,114,523 (b) Less: Depreciation 11,724,303 10,835,834 (c ) Net Block 5-A 11,482,033 12,278,689
Capital Work-in-Progress 5-B 73,729,000 73,729,000
B Investments: 300,000 300,000 Deferred Tax 31,779 31,654
C Current Assets, Loans & Advances: (a) Inventories 6 49,360,496 33,256,028 (b) Sundry Debtors 7 242,169,292 238,513,424 ( c) Loans and Advances 8 171,302,657 99,862,572 (d) Cash and Bank Balances 9 333,989 697,099
463,166,434 372,329,123 Less: Current Liabilities & Provisions: (a) Liabilities 10 50,371,702 22,393,605 (b) Provisions 11 6,848,470 7,977,421
57,220,172 30,371,026
Net Current Assets: 405,946,262 341,958,096
D Miscellaneous Expenditure: 10,173,550 12,716,944 (to the extent not written off or adjusted)
Total : 501,662,624 441,014,383
39
Notes forming part of the Financial Statements -
On behalf of Board of Directors
T. NEHRU K. BALAKRISHNA RAO K.T.VIJAYKUMAR
Chartered Accountant
Chairman Managing Director
Membership No. 15207
Place : Vijayawada S.RAHMATULLAH
Date : 03.05.2010 Company ecretary
Schedules forming part of Balance Sheet
Schedule No. 1 : SHARE CAPITAL: 31st March 2010 31st March 2009 (Amount in Rs.) (Amount in Rs.)
Authorised Share Capital : 3,00,00,000 Equity Shares of Rs. 10/- each 300,000,000 300,000,000
Issued, Subscribed and Paid Up Capital : - -
2,59,18,406 equity shares of Rs. 10/- each 259,184,060 259,184,060
259,184,060 259,184,060
Schedule No. 2 : RESERVES & SURPLUS:
Capital Reserve 92,940,796 92,940,796 General Reserve 39,914,029 25,208,604 Profit and Loss Account 13,712,316 13,131,236
146,567,141 131,280,636
40
Schedule No. 3 : SECURED LOANS:
Union Bank of India - 24,993,261 Kotak Mahendra Bank Limited - Loan - I 2,188,534 2,916,185 India Bulls 6,144,064 6,118,910 Kotak Mahendra Bank Limited - Loan - II 7,783,374 - Corporation Bank - CC 60,090,421 -
76,206,393 34,028,356
Schedule No. 4 : UNSECURED LOANS:
Sales Tax Deferment Loan 3,642,030 3,642,030 Loan from Mr. K. T. Vijay Kumar 15,563,000 12,879,301.00 Select Sis. India Pvt Ltd 500,000 -
19,705,030 16,521,331
Schedule No. 6 : INVENTORY:
Work in Process 230,357 13,203,473 Finished Goods 10,095,827 13,588,330 Packing Material 2,636,512 4,504,132 Raw Material 36,397,800 1,960,093
49,360,496 33,256,028
Schedule No. 7 : DEBTORS:
Debtors considered good Outstanding more than six months 26,316,125 106,534,539 Outstanding less than six months 215,853,167 131,978,885
242,169,292 238,513,424
Schedule No. 8 : LOANS & ADVANCES:
Deposits 2,616,066 2,616,066 Advances with Suppliers 85,601,484 15,745,064 Jetro Petro Biotech Pvt Ltd 55,292,783 54,685,284 Sasya BioTech Private Limited 23,500,000 23,500,000 Due from others 3,719,360 3,316,159 Advance Income Tax Paid A/c 57,832 - VAT Input Receivable 515,132 -
41
171,302,657 99,862,572
Schedule No. 9 : CASH & BANK :
Cash on Hand 244,541 330,629 Union Bank of India - 354,321 Kotak Mahedra Bank Ltd - 12,149 Corporation Bank - CD A/c No. - 326 89,448 -
333,989 697,099
Schedule No. 10 : CURRENT LIABILITIES :
Advances received from Debtors 5,920,986 5,626,576 Outstanding Liabilities 975,595 1,841,490 Sundry Creditors 32,318,802 10,477,232 Other Advances 10,206,279 3,499,267 Deposits from Dealers 950,040 949,040
50,371,702 22,393,605
Schedule No. 11 : PROVISIONS :
Provision for Income Tax 4,123,885 4,168,320 Provision for FBT 16,239 220,000 Provision for TDS 324,660 1,365,295 Provision for VAT - 124,307 Provision for Excise Duty 55,071 Provision for ESI - 13,919 Provision for PF 52,992 102,465 Provision for Profession Tax - 11,440 Provision for Gratuity 2,275,623 1,971,675
6,848,470 7,977,421
42
Schedule No. 05- A : FIXED ASSETS AND DEPRECIATIOIN SCHEDULE:
S. No. Name of Asset
Gross Block Depreciation Net Block
Cost as on
Addition
/ Cost as on As at on For the As at on As at on As at on
01-04-2009 Deletion 31-03-2010
01-04-2009 Year 31-03-2010 31-03-2010 31-03-2009
1 2 3 4 5 6 7 8
(1+2) (4+5) (3-6) (1-4)
1 Land
4,912,121
4,912,121
-
- -
4,912,121
4,912,121
2 Buildings
10,756,835
10,756,835
5,464,528
529,231
5,993,759
4,763,076
5,292,307
3
Plant & Machinery
4,705,164
4,705,164
3,218,558
206,787
3,425,345
1,279,819
1,486,606
4
Furniture & Fixtures
1,268,124
1,268,124
866,160
72,755
938,915
329,209
401,964
5
Computer Equipment
983,262 91,813
1,075,075
956,563
39,720
996,283
78,792 26,699
6 Fire Extinquisher
11,783
11,783
6,740
701
7,441
4,342 5,043
7 Motors
11,444
11,444
6,578
677
7,255
4,189 4,866
8 Car
465,790
465,790
316,707
38,598
355,305
110,485
149,083
Total:
23,114,523 91,813
23,206,336
10,835,834
888,469
11,724,303
11,482,033
12,278,689
Schedule 05-B : Capital Work in progress
01.04.2009 31.03.2010 Bio Diesel Land Advance 5,090,000 5,090,000 Bio Diesel Land & Building Advance 11,225,000 11,225,000
Bio Diesel Machinery Advance 57,414,000 57,414,000
Total Capital W I P 73,729,000 73,729,000
43
CHEMCEL BIOTECH LIMITED VIJAYAWADA
AUDITED PROFIT AND LOSS ACCOUNT FOR THE YEAR ENDED 31.03.2010
PARTICULARS Sch.
31.03.2010
31.03.2009 No.
INCOME
Sales 10 457,640,094 351,877,770 Other Income 11 - - Increase/Decrease in Stocks 12 16,104,467 19,744,552
Total 473,744,561 371,622,322
EXPENDITURE
Manufacturing Expenses 13 405,234,411 292,970,525 Payment to Employees 14 5,129,460 7,848,228 Administrative Expenditure 15 5,002,317 8,701,911 Selling Expenses 16 27,204,028 28,721,550 Interest and Finance Charges 17 9,890,167 11,625,523 Preliminary Expenses 2,543,394 3,284,263
Total 455,003,778 353,152,000
Profit before Depreciation 18,740,783 18,470,322 Depreciation 5 888,469 950,902 Profit before Tax 17,852,315 17,519,420 Provision for Income Tax 4,123,885 4,168,319 Profit after Tax 13,728,430 13,351,101 Provision for FBT 16,239 220,000 Provision for Deferred Tax 125 136
Profit trf to Balance Sheet
13,712,316
13,131,237
Notes forming part of the Financial Statements
44
As per our attached report of even date
On behalf of Board of Directors
T. NEHRU K. BALAKRISHNA RAO K. T. VIJAY KUMAR
Chartered Accountant
Chairman Managing Director
Membership No. 15207
Place : Vijayawada S. RAHMATULLAH Date : 03.05.2010 Company Secretary
45
Rs. Rs. Rs.
31st March, 2010 31st March, 2009
Schedule No. 10 SALES
Sales Account 454,543,133 Excise Duty on Sales 499,545 Cess on Sales 10,280 SHEC on Sales 5,164 VAT on Sales 12,085,001 467,143,123 358,526,147
Less: Sales Returns 9,310,888 Excese Duty on Sales Returns 61,809 Cess on Sales Returns 1,200 SHEC on Sales Returns 596 VAT on Sales Returns 128,537 9,503,029 6,648,377
457,640,094 # 351,877,770
Schedule No. 11 : OTHER INCOME
- -
- -
Schedule No. 12 : INCREASE/DECREASE IN STOCKS
Closing Raw Materials 36,397,800 Closing Work in Process 230,357 Closing Finished Goods 10,095,827 Closing Packing Material 2,636,512
49,360,495 33,256,028 Opening Raw Materials 1,960,093 Opening Work in Process 13,203,473 Opening Finished Goods 13588330 Opening Packing Material 4504132
33,256,028 13,511,476
Increase in Stocks 16,104,467 19,744,552
46
Schedule No. 13 : MANUFACTURING EXPENSES:
Purchases Less Discounts 392,237,372 279,101,547 Excise Duty on Purchases & paid 442,646 607,542 Cess on Purchases 5,791 12,093 SHEC on purchases 2,947 6,045 VAT on Purchases 12,051,887 12,493,811 Freight Inward 86,210 213,250 Formulation Wages 190,227 139,777 Artwork Charges 1,250 15,500 Factory Maintenance 55,494 271,606 Electricity Charges 160,587 109,354
405,234,411 292,970,525
Schedule No. 14: PAYMENT TO EXPLOYEES:
Salaries & Bonus 3,984,823 4,306,895 Medical Allowance to Staff 15,000 163,708 Leave Travel Allowance 413,565 163,708 Provident Fund Contribution 372,421 1,103,156 ESI 39,703 86,086 Gratuity Paid 303,948 2,024,675
5,129,460 7,848,228
Schedule No.15: ADMINISTRATIVE EXPENSES:
Postage & Courier &Telephone 428160 369,370 Legal & Professional Fee 483,242 1,947,068 Directors' Sitting Fees 34,500 67,500 Insurance 153,282 151,713 Remuneration to Directors 2,012,500 3,138,914 Bank Charges 665,689 372,822 Auditor Remuneration 180,000 180,000 Rent 56,450 62,850 Rates & Taxes 49,090 827,061 Printing and Stationery 95,045 93,154 Repairs and Maintenance 22,145 985,285 Other Expenditure 822,215 506,174
5,002,317 8,701,911
47
Schedule No.16 : SELLING EXPENSES:
Advertisement Expenses 176,231 43,847 Boarding & Lodging exp. 97,149 27,870 Dealer Meeting Expenses 306,598 576,444 Discounts 22,347,577 25,316,561 Field Promotion Expenses 2,232,542 794,030 Freight Out ward,and loading Exps. 133,833 - Managerial commission on sales 422,181 - Sales Promotion 93,235 142,447 Travelling Expenses 1,394,682 1,820,351
27,204,028 28,721,550
Schedule No. 17 : INTEREST:
Interest to Banks and Finalacial institutions 9,890,167 11,625,523
9,890,167 11,625,523
48
Schedule No. 05 : FIXED ASSETS AND DEPRECIATIOIN SCHEDULE:
S. No. Name of Asset
Gross Block Depreciation Net Block
Cost as on
Addition
/ Cost as on As at on
For the As at on As at on As at on
01-04-09 Deletion 31-03-10 01-04-09 Year 31-03-10 31-03-10 31-03-09
1 2 3 4 5 6 7 8
(1+2) (4+5) (3-6) (1-4)
1 Land
4,912,121
4,912,121 -
- -
4,912,121
4,912,121
2 Buildings
10,756,835
10,756,835
5,464,528
529,231
5,993,759
4,763,076
5,292,307
3
Plant & Machinery
4,705,164
4,705,164
3,218,558
206,787
3,425,345
1,279,819
1,486,606
4
Furniture & Fixtures
1,268,124
1,268,124
866,160
72,755
938,915
329,209
401,964
5
Computer Equipment
983,262 91,813
1,075,075
956,563
39,720
996,283
78,792
26,699
6
Fire Extinquisher
11,783
11,783 6,740
701
7,441
4,342
5,043
7 Motors
11,444
11,444 6,578
677
7,255
4,189
4,866
8 Car
465,790
465,790
316,707
38,598
355,305
110,485
149,083
Total:
23,114,523 91,813
23,206,336
10,835,834
888,469
11,724,303
11,482,033
12,278,689
49
CHEMCEL BIOTECH LIMITED VIJAYAWADA
CASH FLOW STATEMENT FOR THE YEAR ENDING 31.03.2010
Rs.in thousands
CASH FLOW STATEMENT FOR THE YEAR ENDING 31.03.2010 31.03.2010 31.03.2009
Net Profit Before tax
17,852.32
17,519.42 ADD
Depreciation
888.47
950.90
Provison for Income tax
(4,123.89)
(4,168.31)
provison for FBT
(16.24)
(220.00)
Cash flow Before working capital adjustment
14,600.66
14,082.01 Cash flow from operating Activities
Inventories
(16,104.47)
(19,744.55)
Debtors
(3,655.87)
(125,897.37)
Loans&Advances
(71,440.09)
42,377.57
Current liabilities&Provisions
26,849.15
(49,528.91)
Expenduture
(2,102.39)
Cash flow after working capital adjustment A
(49,750.62)
(140,813.64)
50
. Cash Flow From investing Activities
Increase in fixed assets
(91.81)
(320.82)
Capital Work in Progress
(73,729.00)
Miscellanous Expenduture
2,543.39
(12,611.94) Incvestments
Cash Flow From investing Activities B
2,451.58
(86,661.76) Cash Flow from Financing Activities
increase in share capital
1,574.19
154,002.06
Share Application Money
92,401.23
Secured Loans
42,177.95
(32,535.98)
un Secured Loans
3,183.70
12,879.30
Cash Flow from Financing Activities C
46,935.84
226,746.61
Cash flow A+B+C
(363.20)
(728.79)
Opening balance of cash&cash Equalents
697.10
1,425.00
closing balance of cash&cash Equalents
333.99
697.00
51
BALANCE SHEET ABSTRACT AND COMPANY'S GENERAL BUSINESS PROFILE
(a) Registration Details Registration No. : 01-21888 State Code : 1
Balance Sheet Date : 31/03/2010
(b) Capital Raised Public Issue : 154002 Rights Issue : NIL during the year
(Amount in Bonus Issue : NIL Private Placement/Others : NIL
Rs. Thousands)
(c) Position of Total Liabilities : 501663 Total Assets : 501663 Mobilisation & Development of SOURCES OF FUNDS Funds: (Amount in Rs. Thousands) Paid-up Capital : 259184 Reserves & Surplus : 146567
Secured Loans : 76206 Unsecured Loans : 19705
APPLICATION OF FUNDS
Net Fixed Assets : 11482 Investments : 300
Net Current Assets : 405946 Misc. Expenditure : 10174
Accumulated Losses nil
(d) Performance of Turnover (Incl.other income) : 457640 Total Expenditure : 455004
Company (Amount in Profit/Loss before Tax : 17852 Profit/Loss After Tax : 13728 Rs. Thousands)
Earning per Share in Rs. : 0.53 Dividend Rate (%) : ---
(e) Generic Names of Item Code No.(ITC Code)
Agro Chemicals
Principal Product Description : 2421 products of Company: (As per monetary terms)
52
STATEMENT PURSUANT TO SECTION 212 OF THE COMPANIES ACT, 1956, RELATION TO COMPANY’S INTEREST ON SUBSIDIARY COMPANIES Name of the Subsidiary Company Jetro Petro Bio-Tech Private Limited 01. The Financial Year of the Subsidiary
Company ended on 31.03.2010
02. Date from which they become Subsidiary Company
03.10.2007
03. a. Number of Shares held by Chemcel Bio-Tech Limited with its nominee in the Subsidiary at the end of the financial year of the Subsidiary Company.
30,000 shares
a. Extent interest of Holdings Company at the end of Financial Year of the Subsidiary Company
60%
04. The net aggregate amount of the Subsidiary Company Profit /(Loss) so far as it concerns the members of the Holding Company
Not Applicable - as subsidiary company has not commenced business operations
A. Not dealt with in the Holding Company Accounts for the Financial Year ended 31st March 2010
For the previous financial years of the Subsidiary Company since it became the Holding Company’s subsidiary
Not Applicable - as subsidiary company has not commenced business operations
B. Dealt with in Holding Company’s Accounts for the financial year ended 31st March 2010 For the previous financial years of the Subsidiary Company since it became the Holding Company’s subsidiary
Not Applicable - as subsidiary company has not commenced business operations
53
T. NEHRU, B.Com., F.C.A 59-4-2/2, 3rd Cross, Ashok Nagar, Mogalrajpuram
Vijayawada – 520010. Ph. : 0866-2475826 Cell : 9246472408
AUDITORS REPORT
To
The Members of JETRO PETRO BIO-TECH PRIVATE LIMITED
5. We have audited the attached Balance sheet of JETRO PETRO BIO-TECH PRIVATE LIMITED as at 31st March, 2010 and related Profit and Loss account of the Company for the year ended on that date annexed thereto. These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements based on our audit.
6. We conducted our audit in accordance with accounting standards generally accepted in India. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material mis-statements. An audit includes examining on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by the management as well as evaluating the over all financial statements presentation. We believe that our audit provides a reasonable basis for our opinion.
7. As required by the Companies, (Auditor’s Report) Order 2003 issued by the Central Government in terms of Sub Section (4A) of Section 227 of the Companies Act, 1956, we enclose in the Annexure, a statement on the matters specified in the paragraphs 4 and 5 of the said Order.
8. Further to our comments in the annexure referred to above, we report that:
- We have obtained all the information and explanations, which to the best of our knowledge and belief were necessary for the purpose of our audit.
- In our opinion, proper books of accounts as required by law have been kept by the Company so far as appears from our examination of those books.
- The Profit and Loss account and Balance sheet dealt with by this report are in agreement with the books of accounts of the Company.
- In our opinion, the Profit & Loss account and Balance sheet comply with the accounting standards specified by the Institute of Chartered Accountants of India referred to in Section 211(3C) of the Companies Act, 1956.
54
- On the basis of written representations received from the Director’s as on 31.03.2010, and taken on record by the Board of directors, we report that none of the directors is disqualified as on 31.03.2010 from being appointed as Directors under Section 274(1) (g) of the Companies Act, 1956.
9. In our opinion and to the best of our information and according to the explanations given to us, the said accounts give the information required by the Companies Act, 1956 in the manner so required, and give a true and fair view in conformity with the accounting principles generally accepted in India.
1. In the case of Balance sheet, of the state of affairs of the Company as on 31st March, 2010 2. In the case of Profit & Loss account, of the Profit for the period ended on that date. 3. In the case of Cash Flow Statement for the year ended on 31st March, 2010
Date :- 03.05.2010
Place :- Vijayawada T.NEHRU
Chartered Accountant
CP No.15207
55
ANNEXURE TO THE AUDIT REPORT
{Referred to in paragraph (3) of report of even date}
The Auditor’s report on the account of a Company to which this order applies shall include a statement on the following matters, namely:-
I
a) The Company is maintaining proper records showing full particulars, including quantitative details and situation of fixed assets;
b) All fixed assets have been physically verified by the management at reasonable intervals; there is no material discrepancies noticed on such verification.
c) The Company has not disposed off any substantial part of fixed assets during this year.
II.
a) The physical verification of inventory has been conducted at reasonable intervals by the management;
b) The procedures of physical verification followed by the Management are reasonable and adequate in relation to the size of the company and the nature of its business. There are no inadequacies in such procedures.
c) The company is maintaining proper records of inventory and as informed to us, there is no material discrepancies noticed on physical verification.
III.
a) The Company has not granted any loans, secured or unsecured to parties covered in the register maintained under section 301 of the Companies Act, 1956. Accordingly, Clause (iii)(b) to iii(d) of paragraph 4 of the Order are not applicable to the Company for the current year.
(b) The Company has not taken any loan from a party covered in the register maintained under section 301 of the Companies Act 1956.
c) The rate of interest and other terms and conditions on which the loans have been taken by the Company are not prima facie, prejudicial to the interest of the company.
IV. The company has an adequate internal control procedure commensurate with the size of the company and the nature of its business, for the purchase of inventory of fixed assets and for the size of goods. There is no accounting failure to correct major weaknesses in internal control.
V
a) In our opinion and according to explanation and information given to us, the particulars of contracts or arrangements referred to in Section 301 of the Companies Act, 1956 have been so entered in the Register required to be maintained under this Section.
56
b) In our opinion and according to the information and explanations given to us, the transactions made in pursuance of such contracts or arrangements have been made at prices which are reasonable having regard to prevailing market prices at the relevant time.
VI. The Company has not accepted deposits from the public, as per the provisions of Sections 58A and 58AA of the Act and the rules framed there under.
VII. In our Opinion, the company has an internal audit system commensurate with its size and nature of its business.
VIII. There is no necessity to maintain cost records prescribed by the Central Government under clause (d) of sub-section (1) of Section 209 of the Act, whether such accounts and records have been made and maintained.
IX. There are no statutory dues.
X. The company has not defaulted in repayment of dues to a financial institution or bank. The company has not issued any debentures.
XI. The company has not granted loans and advances on the basis of security by way of pledge of shares.
XII. The Company is not a Chit Fund / Nidhi / Mutual Benefit fund / society.
XIII According to the information and explanations given to us the Company is not dealing or trading in shares, Securities, Debentures and other Investments.
XIV. The company has not given guarantee for loans taken by others from bank and the terms and conditions whereof are not prejudicial to the interest of the Company;
XV. The company has no term loans.
XVI. The funds raised on short-term basis have been used for short-term investment and vice versa;
XVII The Company has not made bonus allotment and right allotment to the party Covered in the Register maintained under section 301 of the Act.
XVIII. The company has not issued any debentures.
XIX. The company has not made any public issue. Hence the matter to be reported as per 4(xx) of the order, are not applicable to the Company.
XX In our Opinion and according to the information given to us, no fraud on or by the Company has been noticed or reported during the year.
Date :- 03.05.2010
Place :- Vijayawada T.NEHRU
Chartered Accountant
CP No.15207
57
JETRO PETRO BIOTECH PRIVATE LIMITED
NOTES ON ACCOUNTS
Basis of Accounting The financial statements are prepared under the historical cost conventions on the basis of going concern and as per applicable Indian accounting standards and are based on the accrual basis of accounting.
Fixed Assets Fixed Assets are recorded at Cost only.
Depreciation Other assets are depreciated on Written down value method in accordance with the rates prescribed in Schedule XIV to the Companies Act, 1956. Retirement Benefits Gratuity provision is yet to be introduced. Miscellaneous and Preliminary Expenses Effective from 01.04.2006, such expenditure is written off as incurred in accordance with AS – 26, Intangible Assets within 4 years. Subsidiary The company become a subsidiary to Chemcel Biotech Ltd. The shareholding of Chemcel Biotech Ltd is 60 % of total share capital.
Related party disclosure
Other liabilities includes Rs. 5,52,42,784/- advanced by Chemcel Biotech Limited besides, Chemcel Biotech Lmited had invested 60% in the share capital i.e. Rs. 3,00,000/-.
58
Value of Imports and indigenous materials consumed NIL
Value of imports on GIF basis NIL
Expenditure in foreign currency NIL
Earnings in foreign exchange on cash basis NIL
Figures of previous year have been re-grouped wherever necessary NIL
FOR AND ON BEHALF OF BOARD
T. NEHRU P. L. NARASIMHA MURTHY
Chartered Accountant Managing Director. Y. V. RAMANA RAO DIRECTOR K. BALAKRISHNA RAO NOMINEE DIRECTOR Place: VIJAYAWADA Date : 03.05.2010
59
JETRO PETRO BIOTECH (P) LTD
VIJAYAWADA
AUDITED BALANCE SHEET AS ON 31st MARCH 2010 (Amount in Rs.)
PARTICULARS Sch. No.
31.03.2010 31.03.2009
I SOURCES OF FUNDS:
A Sahare Holders' Funds (a) Share Capital 1 500,000 500,000
500,000 500,000
TOTAL: 500,000 500,000
II APPLICATION OF FUNDS
A Fixed Assets: 2 (a) Gross Block 30,000 30,000 (b) Less: Depreciation 16,092 9,810 (c ) Net Block 13,908 13,908 20,190
C Current Assets, Loans & Advances: (a) Loans and Advances 4 55,188,000 55,188,000 (b) Cash and Bank Balances 3 13,795 65,711
55,201,795 55,253,711 Less: Current Liabilities & Provisions: (a) Liabilities 5 55,412,784 55,246,211
Net Current Assets: (210,989) 7,500
D Miscellaneous Expenditure: 6 697,082 472,310
Total 500,000 500,000
- Notes forming part of the Financial Statements As per our attached report of even date On behalf of Board of Directors
T. NEHRU P. L. NARASIMHA MURTHY Y. V. RAMANA RAO Chartered Accountant Managing Director Director Membership No. 15207
60
K. BALAKRISHNA RAO Nominee Director
JETRO PETRO BIOTECH (P) LTD VIJAYAWADA
PROFIT AND LOSS ACCOUNT FOR THE PERIOD (Amount in Rs.)
PARTICULARS Sch. No. 31.03.2010 31.03.2009
I INCOME
A Sales - - Increase/Decrase in stocks - -
TOTAL: - -
II EXPENDITURE
Purchase account - - Payament to Employees 7 138,000 138,000 Administrative Expenditure 8 56,481 64,681 Interest 9 24,009 19,524 Preliminary Expenditure Account 6 14,250 14,250
Total 232,740 236,455
Profit before Depreciation (232,740) (236,455) Depreciation 6,282 9,810 Profit before Tax (239,022) (246,265)
- - Net Profit/Loss for the year (239,022) (246,265)
Notes forming part of the Financial Statements As per our attached report of even date On behalf of Board of Directors
T. NEHRU P. L. NARASIMHA MURTHY Y. V. RAMANA RAO Chartered Accountant Managing Director Director Membership No. 15207
K. BALAKRISHNA RAO Nominee Director
61
Schedule No. 1 : SHARE CAPITAL: 31st March 2010 31st March 2009 (Amount in Rs.) (Amount in Rs.)
Authorised Share Capital 1,00,000 Equity Shares of Rs. 10/- each 1,000,000 1,000,000
Issued, Subscribed and Paid Up Capital: 50,000 equity shares of Rs. 10/- each 500,000 500,000
500,000 500,000
Schedule No. 3 : CASH & BANK :
Cash on Hand 12,231 65,711 Union Bank of India 1,564 -
13,795 65,711
Schedule No. 4 : LOANS & ADVANCES:
Seed Advance to Farmers 54,941,500 54,941,500 L. Sundaraiah 236,500 236,500 Rent Deposit 10,000 10,000
- - 55,188,000 55,188,000
Schedule No. 5 : CURRENT LIABILITIES :
Chemcel Biotech Limited 55,242,784 54,685,284 T. Nehru 30,000 20,000 Venkata Ramana 140,000 10,000 Union Bank of India - Temporary OD - 530,927
55,412,784 55,246,211
Schedule No. 6 : MISCELLANEOUS EXPENDITURE :
a) Preliminary Expenses 28,500 42,750 Less: Written off 14,250 14,250 Preliminary Expenses 14,250 28,500 (to the extent not written off or adjusted)
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b) Net Loss 682,832 443,810
697,082 472,310
Schedule No. 7 : PAYMENT TO EMPLOYEES:
Salaries and other benefits to Staff 138,000 138,000
138,000 138,000
Schedule No. 8 : ADMINISTRATIVE EXPENDITURE:
Audit Fee 10,000 10,000 Rent 39,600 39,600 Bank Charges 1,001 1,909 Electricity Charges 1,080 1,032 Pooja Expenses 1,200 1,250 Printing and Stationery - 5,850 Telephone Charges 3,600 5,040
- 56,481 64,681
Schedule No. 9 : Interest : Interest to Union Bank of India 24009 19,524
24,009 19,524
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SCHEDULE No. 2 :: SCHEDULE FOR FIXED ASSETS AND DEPRECIATION
S. No. Name of Asset
Gross Block Depreciation Net Block
cost as on
Addition
/ cost as on As at on
For the As at on As at on As at on
01-04-09 Deletion 31-03-10 01-04-09 Year 31-03-10 31-03-10 31-03-09
1 2 3 4 5 6 7 8
(1+2) (4+5) (3-6) (1-4)
1. Computer 20,000 -
20,000
8,000
4,800
12,800 #
7,200 12,000
2. Furniture & Fixtures 10,000 -
10,000
1,810
1,482
3,292
6,708 8,190
Total: 30,000 - 30,000
9,810
6,282
16,092
13,908 20,190
64
DIRECTORS’ REPORT Dear Members – M/s Jetro Petro Biotech Pvt Ltd
Your Directors have pleasure in presenting the Third Annual Report on the business and operations of the
Company together with Audited Statement of Accounts for the year ended 31st March 2010. The highlights
for the year under review are as follows: -
16. FINANCIAL HIGHLIGHTS:
The performance of the Company during the period under review is Summarized below: -
(Amount in Rs.) PARTICULARS 2009-10 2008-09 Net Sales Nil Nil Expenditure 2,32,740 2,36,455 Profit/(Loss) before taxes (239022) (246265) Depreciation 6,282 9,810 Provision for taxes Nil Nil Profit / (Loss) carried to Balance Sheet (239022) (246265)
OPERATIONS
The Company being in a nascent stage has yet to commence its regular business. It became Subsidiary
of Chemcel Biotech Ltd, Vijayawada having 60% of Equity acquired by that company. The Holding
company nominated its Non Executive Chairman Sri. K. Balakrishna Rao as the Director on the Board
who is having 9 Year contract with the Holding company to supply Jetropha seeds regularly.
FUTURE PROSPECTS With increasing crude oil prices, environmental concerns and rising awareness, the global outlook
towards bio fuels is very positive at the moment and will only strengthen in the conceivable future.
Our farmers have already started growing Jetropha plantations and are confident to supply Jetropha
Seeds and ensure continued supply of jetropha seeds .Also, a proposal is being devised to import,
trade ,develop a network for marketing and opening of outlets for Bio diesel to avoid delay in getting
seeds from our own sources.
65
PUBLIC DEPOSITS
Your company has not accepted any Deposits from the public during the year under review and there
are no outstanding deposits as on 31st March’2010 and the provisions of Section 58A of the Companies
Act, 1956 are not applicable.
DIRECTORS RESPONSIBILITY STATEMENT As required under Section 217 (2AA) of the companies Act 1956, your Directors affirm that:
1. In the preparation of the Annual Accounts for the year ended 31st March 2010 applicable
accounting standards have been followed with no material departure.
2. Accounting policies have been selected and applied consistently, at the same time judgments
and Estimates have been made, that are reasonable and prudent so as to give a true and fair
view of the state of affairs of the Company at the end of the financial year and of the profit for
the year under review.
3. Proper and sufficient care has been taken for the maintenance of adequate accounting records in
accordance with the provisions of the Act for safeguarding the assets of the Company and for
preventing and detecting fraud and other irregularities; and.
4. Accounts for the year ended 31st March, 2010 have been prepared on a going concern basis.
AUDITORS Sri.T.Nehru Chartered Accountant, Vijayawada retires at the conclusion of the forthcoming Annual General
Meeting and is eligible for re-appointment. The Board recommends the appointment of Sri.T.Nehru,
Chartered Accountant as Auditor to hold office till the conclusion of next Annual General Meeting.
ACKNOWLEDGEMENTS
We thank our Holding Company for giving us a good amount which enabled us to take contracts with
farmers and start Jetropha plantation. Further we thank Sri. Balakrishna Rao, Non Executive Chairman of
Chemcel Biotech Ltd., our nominee Director ,for giving us all help and co-operation the year for conducting
affairs of the company.
Place: Vijayawada By the order of the Board
Date: 09.08.2010 sd/-
Y. Venkata Ramana Rao
Director
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T. NEHRU, B.Com., F.C.A 59-4-2/2, 3rd Cross, Ashok Nagar, Mogalrajpuram,
Vijayawada – 520010. Ph. : 0866-2475826 Cell : 9246472408
AUDITORS REPORT
To
The Members of CHEMCEL BIO-TECH LIMITED
1 We have audited the attached Consolidated Balance sheet of CHEMCEL BIOTECH LIMITED and JETRO PETRO BIOTECH PVT LTD ( subsidiary) as at 31st March, 2010 and related Profit and Loss account of the above Companies for the year ended on that date annexed thereto along with consolidated cash flow statement.
2 These financial statements are the responsibility of the Company’s Management. Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with accounting standards generally accepted in India. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material mis-statements. An audit includes examining on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by the management as well as evaluating the over all financial statements presentation. We believe that our audit provides a reasonable basis for our opinion.
3 We have audited the financial statements of subsidiary, whose financial statement reflects net loss of Rs.2,39,022/- as at 31.03.2010 and total revenue of Rs. Nil for the year ended on that date.
4 We report the consolidated financial statements have been prepared by the company in accordance
with the requirements of accounting standard 21, consolidated financial statements issued by the Institute of Chartered Accountants of India and on the basis of the separate audited financial statements of Chemcel Biotech Limited and its subsidiary included in the Consolidated Financial Statements.
5. In our opinion and to the best of our information and according to the explanations given to us, the said accounts give the information required by the Companies Act, 1956 in the manner so required, and give a true and fair view in conformity with the accounting principles generally accepted in India.
a. In the case of Consolidated Balance sheet, of the state of affairs of the Company as on 31st March, 2010 b. In the case of Consolidated Profit & Loss account, of the Profit for the period ended on that date.
c. In the case of Consolidated Cash Flow Statement for the year ended on 31st March, 2010
Date :- 03.05.2010. T. NEHRU
Place :- Vijayawada Chartered Accountant
CP No.15207
67
ANNEXURE TO THE AUDIT REPORT
{Referred to in paragraph (3) of report of even date}
The Auditor’s report on the account of a Company to which this order applies shall include a statement on the following matters, namely:-
I.
a) The Company is maintaining proper records showing full particulars, including quantitative details and situation of fixed assets;
b) All fixed assets have been physically verified by the management at reasonable intervals; there is no material discrepancies noticed on such verification.
c) The Company has not disposed off any substantial part of fixed assets during this year.
II. a) The physical verification of inventory has been conducted at reasonable intervals by the management;
b) The procedures of physical verification followed by the Management are reasonable and adequate in relation to the size of the company and the nature of its business. There are no inadequacies in such procedures.
c) The company is maintaining proper records of inventory and as informed to us, there is no material discrepancies noticed on physical verification.
III. a) The Company has not granted any loans, secured or unsecured to parties covered in the register
maintained under section 301 of the Companies Act, 1956. Accordingly, Clause (iii)(b) to iii(d) of paragraph 4 of the Order are not applicable to the Company for the current year.
b) The Company has taken interest free loan of Rs. 1,55,63,000/- from Sri K. T. Vijay Kumar, the Managing Director of the Company, covered in the register maintained under section 301 of the Companies Act 1956.
c) The rate of interest and other terms and conditions on which the loans have been taken by the Company are not prima facie, prejudicial to the interest of the company.
IV. The company has an adequate internal control procedure commensurate with the size of the company and the nature of its business, for the purchase of inventory of fixed assets and for the size of goods. There is no accounting failure to correct major weaknesses in internal control.
V a) In our opinion and according to explanation and information given to us, the particulars of contracts or arrangements referred to in Section 301 of the Companies Act, 1956 have been so entered in the Register required to be maintained under this Section.
b) In our opinion and according to the information and explanations given to us, the transactions made in pursuance of such contracts or arrangements have been made at prices which are reasonable having regard to prevailing market prices at the relevant time.
VI. The Company has not accepted deposits from the public, as per the provisions of Sections 58A and 58AA of the Act and the rules framed there under.
VII. In our Opinion, the company has an internal audit system commensurate with its size and nature of its business.
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VIII. According to information and explanations give to us the Central Government has not prescribed the maintenance of the cost records by the company under clause (d) of sub section (I) of 209 of Companies Act, 1956.
.
IX. a) The company is regular in depositing undisputed statutory dues including Provident Fund, Employees State Insurance, Cess and any other statutory dues within the time, with the appropriate authorities.
b) The Company is disputing the sales tax liability for an amount of Rs. 8,37,576/- and income tax liability of Rs. 36,40,723/- Since the appeals are pending no provision has been made.
X. The company is a profit making company.
XI. The company has not defaulted in repayment of dues to a financial institution or bank. The company has not issued any debentures.
XII. The company has not granted loans and advances on the basis of security by way of pledge of shares.
XIII. The Company is not a Chit Fund / Nidhi / Mutual Benefit fund / society.
XIV According to the information and explanations given to us the Company is not dealing or trading in shares, Securities, Debentures and other Investments.
XV. The company has given guarantee for loans taken by others from Andhra Bank and the terms and conditions whereof are not prejudicial to the interest of the Company;
XVI. In our opinion the Term Loans availed by the Company during the year were, prime facie, applied for the purpose for which they were obtained.
XVII. The funds raised on short-term basis have been used for short-term investment and vice versa;
XVIII The Company has not made bonus allotment and right allotment to the party Covered in the Register maintained under section 301 of the Act.
XIX. The company has not issued any debentures.
XX. The company has not made public issue during the year.
XXI In our Opinion and according to the information given to us, no fraud on or by the Company has been noticed or reported during the year.
Date :- 03.05.2010 T.NEHRU
Place :- Vijayawada Chartered Accountant
CP No.15207
69
CHEMCEL BIOTECH LIMITED
SCHEDULE NO. 20 : NOTES ON ACCOUNTS
1. Basis of Accounting
The consolidated financial statements of Chemcel Biotech Limited and its subsidiary Jetro Petro Biotech Private Limited are prepared under the historical cost convention in accordance with generally accepted principles in India and the Accounting Standard 21 on “Consolidated Financial statements” to the extent possible in the same format as that adopted by the Company for its separate financial statements on the basis of going concern and as per applicable Indian accounting standards and are based on the accrual basis of accounting.
2. Revenue Recognition
Sales – Sales excludes Excise Duty, Cess, SHEC.
All expenses and income are accounted for on accrual basis as per the requirements of the Companies Act.
3. Fixed Assets Fixed Assets are recorded at Cost. Cost is purchase cost, and in the case of Land, includes development cost incurred, together with all incidental cost of acquisition, borrowing costs and other related internal costs. Fixed Assets are shown Gross Block Less Depreciation.
4. Depreciation Freehold land is not depreciated.
Other assets are depreciated on Written down value method in accordance with the rates prescribed in Schedule XIV to the Companies Act, 1956.
5. Impairment Loss The company assets at each Balance sheet date whether there is any indication that any asset may be impaired and if such indication exists, the carrying value of such asset is reduced to its recoverable amount and a provision would be made for such impairment loss in the profit and loss account, however there is no such type of asset during the year.
6. Retirement Benefits Contribution to Provident fund accounted on accrual basis. Gratuity provision is introduced and accounted on accrual basis.
7. Miscellaneous and Preliminary Expenses During the previous year the Company gone for Public Issue and all Public Issue expenses are treated as per sec. 35(D) of Income Tax Act.
8. Deferred Tax Deferred tax is recognized on timing difference between taxable income and accounting income that originated in one period and are capable of reversal in one or more subsequent periods.
70
9. Capital Work in Progress:
The company has acquired additional land at Kondapalli and advance given for civil works and machinery to set up Bio Diesel process plant, which is shown separately as capital work in progress.
10. Investments:
The company had taken 60% stake in Jetro Petro Biotech Private Limited and invested Rs. 3,00,000/- it becomes holding company to Jetro Petro Biotech Private Limited. The investments is shown at cost.
11. Borrowing Costs
Borrowing costs attributable to the acquisition and construction of the Qualifying Assets, which takes substantial period of time to get ready for its intended use, are capitalized as part of the cost of respective assets up to the date when such asset is ready for its intended use. Other Borrowing costs are charged to the Profit and Loss account.
12. Valuation of Inventory
Inventories of Spares, consumables, and components are valued at lower of cost and net realizable value. Cost represents purchase cost and other incidental costs, if any. Cost of Inventories is computed on FIFO basis.
13. Micor/Small Industries:
There are no dues to the Micro/Small Scale Industries. We are not having accounts with Micro/Small Scale Industries.
14. Subsidy
The Company opted to for the sales tax deferment scheme and the amount of sales tax payable to sales tax department is payable from the 14th year of deferment. The amount is shown as unsecured Loans and do not carry any interest.
15. Secured Loans & Securities:
Working Capital facility for an amount of Rs 6.00 Crores from Corporation Bank, Vijayawada Benz Circle Branch by giving the following securities:
Hypothecation of stocks and receivables (less than six months), Plant and machinery and all movable fixed assets of the company and personal guarantee of Managing Director Mr.K T Vijaykumar & Chairman Mr.K Balakrishna Rao.
The company has obtained Term Loans for an amount of Rs. 38.80 lakhs & Rs. 91.47 lacs from Kotak Mahendra Bank Limited, Vijayawada by mortgaging Kondapalli site and personal guarantee of directors.
The company has obtained mortgage loan of Rs. 65.00 lakhs from India Bulls against third party guarantee.
16. Contingent Liability/ Contingent Asset:
The disclosures required by Accounting Standard 29 “Provision, Contingent Liabilities, contingent Assets”, Company is disputing sales tax liability of Rs. 8,37,536/- and also income tax liability of Rs. 36,40,723/- for which no provision has been made.
71
17. Related party disclosure
Related party disclosures have been set out in a separate statement annexed to this schedule. The related parties, as defined by Accounting Standard 18 “Related Party Disclosure” issued by the Institute of Chartered Accountants of India, in respect of which the disclosures have been made, have been identified and taken on record by the Board.
Key Management Personnel
5. Sri K. Balakrishna Rao - Chairman 6. Sri K. T. Vijay Kumar - Managing Director 7. Sri K. C. S. Prasad - Director – Production 8. Sri Ch. V. Vara Prasad Rao - Executive Director.
Related Parties
Jetro Petro Biotech Private Limited- Subsidiary company
Transactions with other related parties
Nature of transaction Amount
Advance paid to Jetro Petro Biotech Ltd Rs. 5,52,92,783/- (paid towards supply of Jetropha seeds in terms of agreement)
Interest free unsecured loan received from Sri K. T. Vijay Kumar Rs. 1,55,63,000/-
The following transactions were carried out with Key Management Personnel and related parties in the ordinary course of business:
Transactions with Key Management Personnel
Particulars 2009-10 2008-09
Chairman 3,98,456 11,56,945
Managing Director 11,07,279 10,77608
Director – Production 8,77,632 9,04,360
Executive Director 1,03,500 -
Total: 24,86,867 31,38,914
Above includes Salary, Commission and perquisites.
19. Details of Quantitative information pursuant to para 3 & 4 C of Part II Schedule VI of the Companies Act, 1956:
72
The installed capacity is Liquids – 1000 KL, Granules – 1000 MT and Dusts – 300 MT.
Particulars in respect of production and sales
Particulars in respect of Sales for the year 2009-10 including Packing Material
19. Break-up for Repairs to Others:
Particulars Amount in Rs. Garden Maintenance 0
Office Maintenance 39396
Electrical Maintenance 1205
Total 40601
20. Particulars of Payments to Directors:
Designation Salary
(Rs.)
Commission
(Rs.)
Perquisites
(Rs.)
Total
(Rs.)
Managing Directors: -Mr. K. T. Vijay Kumar
8,97,000 1,80,935 29,344 11,07,279
Whole Time Directors
- Mr. K.Balakrishna Rao 3,22,000 60,311 16,145 3,98,456
- Mr. K.C.S. Prasad 6,90,000 1,80,935 6,697 8,77,632
- Mr. Ch.V.Vara Prasad Rao 1,03,500 - - 1,03,500
Grand Total 20,12,500 4,22,181 52,186 24,86,867
Class of Goods Production (Quantity)
Current Year Previous Year
Raw materials consumed 17,21,098 7,83,610
Packing material consumed 1,59,696 2,25,352
Quantity Value
Liquids - Lts 891076 298283078
Dusts - Kgs 728427 158260211
Granules- Kgs 38688 1096805
Total 1658191 457640094
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The following is the computation of net profits of the company:
Net Profit before Tax as per Profit and Loss Account Rs. 1,78,52,315
Add : Commission to Directors Rs. 4,22,181
Profit before Commission Rs. 1,82,74,496
Commission payable to Chirman @ 1% of net profit (4 months) Rs. 60,311
Commission payable to Managing Director @ 1% of net profit Rs. 1,80,935
Commission payable to Production Director @ 1% of net profit Rs. 1,80,935
21. Particulars of payment to Auditors:
Particulars 2009-10
Rs.
2008-09
Rs.
i) Statutory Auditors 1,20,000 1,20,000
ii) Internal Auditors 40,000 40,000
iii) In other Capacity
- for Tax Audit
- for Certification & other matters
20,000
20,000
Total: 1,80,000 1,80,000
22. A. Expenditure in Foreign Currency:
Particulars 2009-10
Rs.
2008-09
Rs.
a) Travelling Expenses Nil Nil
b) Subscriptions and others Nil Nil
Total: Nil Nil
B. Earnings in Foreign Currency:
Particulars 2009-10
Rs.
2008-09
Rs.
Others Nil Nil
Total: Nil Nil
74
23. Balances due from / due to the Subsidiary Companies:
Particulars Balance as on 31.03.2010 Rs.
Balance as on 31.03.2009
Rs.
Maximum Balance during the year
Rs.
Jetro Petro Biotech Private Limited 5,52,92,783 5,46,85,284 5,52,92,783
Value of Imported materials consumed NIL
Value of Indigenous materials consumed 100%
Value of imports on CIF basis NIL
Value of Imported raw material, spare parts consumed NIL
Expenditure in foreign currency NIL
Earnings in foreign exchange on cash basis NIL
Figures of previous year have been re-grouped wherever necessary YES
Amount remitted during the year in Foreign Currency on account of
Dividends NIL
Earnings per share
Net Profit after tax Rs. 1,37,12,316
No. of Shares 2,59,18,406
Earning per Equity Share basic and diluted Rs. 0.53
FOR AND ON BEHALF OF BOARD T. NEHRU K.BALAKRISHNA RAO K.T.VIJAY KUMAR
Chartered Accountant Chairman Managing Director.
S. RAHMATULLAH Company Secretary Place: VIJAYAWADA Date : 03.05.2010
75
CHEMCEL BIOTECH LIMITED VIJAYAWADA
AUDITED CONSOLIDATED BALANCE SHEET AS ON 31st MARCH 2010
(Rs. In 000's)
PARTICULARS Sch. No. 31.03.2010
31.03.2009
I SOURCES OF FUNDS:
A Sahare Holders' Funds
(a) Share Capital 1
259,184 259,184
(b) Minority Interest - 22
(b) Reserves and Surplus 2
146,084 131,014
405,268
390,221
B Loan Funds
(a) Secured Loans 3
76,206 34,028
(b) Unsecured Loans 4
19,705 16,521
95,911
50,550
TOTAL: 501,179
440,771
II APPLICATION OF FUNDS
A Fixed Assets:
(a) Gross Block
23,236 23,145
(b) Less: Depreciation
11,740 10,846
(c ) Net Block 5
11,496 12,299
Capital Work-in-Progress 5
73,729
73,729
B Investments: -
Deferred Tax 32
32
C Current Assets, Loans & Advances:
76
(a) Inventories
49,360 33,256
(b) Sundry Debtors
242,169 238,513
( c) Loans and Advances
171,199 100,425
(d) Cash and Bank Balances
348
703
463,076
372,898
Less: Current Liabilities & Provisions:
(a) Liabilities
50,492 22,955
(b) Provisions
6,848 7,977
57,340
30,932
Net Current Assets:
405,735 341,966
D Miscellaneous Expenditure:
10,187
12,745
(to the extent not written off or adjusted)
Total 501,179
440,771
Notes forming part of the Financial Statements As per our attached report of even date
On behalf of Board of Directors
T. NEHRU
Chartered Accounant K. BALAKRISHNA
RAO K.T.VIJAY KUMAR
Membership No. 15207 Chairman Managing Director
Place : Vijayawada S. RAHAMATULLAH
Date : 03.05.2010 Company Secretary
77
Schedule No. 1 : SHARE CAPITAL: 31st March 2010 31st March 2009 (Amount in Rs.) (Amount in Rs.)
Authorised Share Capital 3,00,00,000 Equity Shares of Rs. 10/- each 300,000,000 300,000,000
Issued, Subscribed and Paid Up Capital:
2,59,18,406 equity shares of Rs. 10/- each 259,184,060 259,184,060
259,184,060 259,184,060
Schedule No. 2 : RESERVES & SURPLUS:
Capital Reserve 92,940,796 92,940,796 General Reserve 39,914,029 25,090,077 Profit and Loss Account 13,229,484 12,983,477
146,084,309 131,014,350
Schedule No. 3 : SECURED LOANS:
Union Bank of India - 24,993,261 Kotak Mahendra Bank Limited-Loan 1 2,188,534 2,916,185 India Bulls 6,144,064 6,118,910 Kotak Mahendra Bank Limited-Loan 2 7,783,374 Coporation Bank CC 60,090,421
76,206,393 34,028,356
Schedule No. 4 : UNSECURED LOANS:
Sales Tax Deferment Loan 3,642,030 3,642,030 Interest free loan from K T Vijay kumar 15,563,000 12,879,302 Select Sis India Pvt Ltd 500,000
19,705,030 16,521,332
Schedule No. 6 : INVENTORY:
Work in Process 230,357 13,203,473 Finished Goods 10,095,827 13,588,330 Packing Material 2,636,512 4,504,132 Raw Material 36,397,800 1,960,093
78
49,360,496 33,256,028
Schedule No. 7 : DEBTORS: Debtors considered good Outstanding more than six months 26,316,125 106,534,539 Outstanding less than six months 215,853,167 131,978,885
242,169,292 238,513,424
Schedule No. 8 : LOANS & ADVANCES:
Deposits 2,626,066 2,626,066 Advances with Suppliers 85,601,484 15,745,064 Travelling Advance - - Advances - IPO - - Staff Advances - - Jetro Petro Biotech Pvt Ltd 55,292,783 54,685,284 Sasya BioTech Private Limited 23,500,000 23,500,000 Due from others 3,605,360 3,868,874 Advance Income Tax paid 57,832 VAT Input receivable 515,132
171,198,657 100,425,288
Schedule No. 9 : CASH & BANK :
Cash on Hand 256,772 336,340 Union Bank of India 1,564 354,321 Kotak Mahedra Bank Ltd 12,149 Corporation Bank CD 89,448
347,784 702,810
Schedule No. 10 : CURRENT LIABILITIES :
Advances received from Debtors 5,920,986 5,626,576 Outstanding Liabilities 975,595 2,402,418 Sundry Creditors 32,318,802 10,477,232 Other Advances 10,326,279 3,499,267 Deposits from Dealers 950,040 949,040
50,491,702 22,954,533
79
Schedule No. 9 : PROVISIONS :
Provision for Income Tax 4,123,885 4,168,319 Provision for FBT 16,239 220,000 Provision for TDS 324,660 1,365,295 Provision for VAT - 124,307 Provision for ESI - 13,919 Provision for Excise Duty 55,071 Provision for PF 52,992 102,465 Provision for Profession Tax 11,440 Provision for Gratuity 2,275,623 1,971,675
6,848,470 7,977,420
80
AUDITED CONSOLIDATED PROFIT & LOSS ACCOUNT FOR THE YEAR ENDED 31.03.2010
(Rs. In 000's)
PARTICULARS Sch. 31.03.2010 31.03.2009
No.
INCOME
Sales 10 457,640 351,877
Other Income 11 - -
Increase/Decrease in Stocks 12 16,104
19,745
Total 473,745 371,622
EXPENDITURE
Manufacturing Expenses 13 405,234
292,970
Payment to Employees 14 5,267
7,986
Administrative Expenditure 15 5,059
8,766
Selling Expenses 16 27,204 28,722
Interest and Finance Charges 17 9,914
11,645
Preliminary Expenses 2,558 3,299
Total 455,237
353,388
Profit before Depreciation 18,508
18,234
Depreciation 5 895
961
Profit before Tax 17,613
17,273 Provision for Income Tax 4,124
4,168
Profit after Tax 13,489
13,105 Provision for FBT 16
81
220 Provision for Deferred Tax 0
0
Profit trf to Balance Sheet 13,473
12,885
Notes forming part of the Financial Statements As per our attached report of even date
On behalf of Board of Directors
T. NEHRU K. BALAKRISHNA
RAO K.T.
VIJAYKUMAR
Chartered Accounant Chairman Mananging Director
Membership No. 15207
Place : Vijayawada S.
RAHAMATULLAH Date : 03.05.10 Company Secretary
82
Rs. Rs. Rs. 31st March,
2010 31st March,
2009 Schedule No. 10 SALES
Sales Account 454,543,133 Excise Duty on Sales 499,545 Cess on Sales 10,280 SHEC on Sales 5,164 VAT on Sales 12,085,001 467,143,123 358,526,147
Less: Sales Returns 9,310,888 Excese Duty on Sales Returns 61,809 Cess on Sales Returns 1,200 SHEC on Sales Returns 596 VAT on Sales Returns 128,537 9,503,029 6,648,377
457,640,094 351,877,770
Schedule No. 11 : OTHER INCOME
- -
- -
Schedule No. 12 : INCREASE/DECREASE IN STOCKS
Closing Raw Materials 36,397,800 Closing Work in Process 230,357 Closing Finished Goods 10,095,827 Closing Packing Material 2,636,512
49,360,495 33,256,028 Opening Raw Materials 1,960,093 Opening Work in Process 13,203,473 Opening Finished Goods 13588330 Opening Packing Material 4504132
33,256,028 13,511,476
Increase in Stocks 16,104,467 19,744,552
83
Schedule No. 13 : MANUFACTURING EXPENSES:
Purchases Less Discounts 392,237,372 279,101,547 Excise Duty on Purchases & paid 442,646 607,542 Cess on Purchases 5,791 12,093 SHEC on purchases 2,947 6,045 VAT on Purchases 12,051,887 12,493,811 Freight Inward 86,210 213,250 Formulation Wages 190,227 139,777 Artwork Charges 1,250 15,500 Factory Maintenance 55,494 271,606 Electricity Charges 160,587 109,354
405,234,411 292,970,525
Schedule No. 14: PAYMENT TO EXPLOYEES:
Salaries & Bonus 4,122,823 4,444,895 Medical Allowance to Staff 15,000 163,708 Leave Travel Allowance 413,565 163,708 Provident Fund Contribution 372,421 1,103,156 ESI 39,703 86,086 Gratuity Paid 303,948 2,024,675
5,267,460 7,986,228
Schedule No.15: ADMINISTRATIVE EXPENSES:
Postage & Courier &Telephone 431760 374,410 Legal & Professional Fee 483,242 1,947,068 Directors' Sitting Fees 34,500 67,500 Insurance 153,282 151,713 Remuneration to Directors 2,012,500 3,138,914 Bank Charges 666,690 374,731 Auditor Remuneration 190,000 190,000 Rent 96,050 102,450 Rates & Taxes 49,090 827,061 Printing and Stationery 95,045 99,004 Repairs and Maintenance 22,145 985,285 Other Expenditure 824,495 508,454
5,058,798 8,766,590
84
Schedule No.16 : SELLING EXPENSES:
Advertisement Expenses 176,231 43,847 Boarding & Lodging exp. 97,149 27,870 Dealer Meeting Expenses 306,598 576,444 Discounts 22,347,577 25,316,561 Field Promotion Expenses 2,232,542 794,030 Freight Out ward,and loading Exps. 133,833 - Managerial commission on sales 422,181 - Sales Promotion 93,235 142,447 Travelling Expenses 1,394,682 1,820,351
27,204,028 28,721,550
Schedule No. 17 : INTEREST:
Interest to Banks and Finalacial institutions 9,914,176 11,645,047
9,914,176 11,645,047
85
Schedule No. 05 : CONSOLIDATED FIXED ASSETS AND DEPRECIATIOIN SCHEDULE:
S. No. Name of Asset
Gross Block Depreciation Net Block
Cost as on
Addition
/ Cost as on As at on For the As at on As at on As at on
01-04-09 Deletion 31-03-10 01-04-09 Year 31-03-10 31-03-10 31-03-09
1 2 3 4 5 6 7 8
(1+2) (4+5) (3-6) (1-4) 1 Land
4,912,121
4,912,121 - - -
4,912,121
4,912,121
2 Buildings
10,756,835
10,756,835
5,464,528
529,231
5,993,759
4,763,076
5,292,307
3 Plant & Machinery
4,705,164
4,705,164
3,218,558
206,787
3,425,345
1,279,819
1,486,606
4 Furniture & Fixtures
1,278,124
1,278,124
867,970
74,237
942,207
335,917
410,154
5 Computer Equipment
1,003,262 91,813
1,095,075
964,563
44,520
1,009,083
85,992
38,699
6 Fire Extinquisher
11,783
11,783
6,740
701
7,441
4,342
5,043
7 Motors
11,444
11,444
6,578
677
7,255
4,189
4,866
8 Car
465,790
465,790
316,707
38,598
355,305
110,485
149,083
Total:
23,144,523 91,813
23,236,336
10,845,644
894,751
11,740,395
11,495,941
12,298,879
Schedule 05-B : Capital Work in progress
01.04.2009
31.03.2010
Bio Diesel Land Advance 5,090,000
5,090,000
Bio Diesel Land & Building Advance 11,225,000
11,225,000
Bio Diesel Machinery Advance 57,414,000
57,414,000
Total Capital W I P 73,729,000
73,729,000
86
CONSOLIDATED CASH FLOW STATEMENT FOR THE YEAR ENDING 31.03.2010 Rs.in thousands
CONSOLIDATED CASH FLOW STATEMENT FOR THE YEAR ENDING 31.03.2010
31.03.2010 Net Profit Before tax 17613 ADD Depreciation 895 Provison for Income tax -4124 provison for FBT -16 A Cash flow from operating Activities Inventories -16104 Debtors -3656 Loans&Advances -70775 Current liabilities&Provisions 26408 Expenduture 0 -49759 B Cash Flow From investing Activities Increase in fixed assets -91 Capital Work in Progress 0 Miscellanous Expenduture 2558 Incvestments 0 2467 C Cash Flow from Financing Activities Increase in share capital 1597 Decrese in minorities interest -22 Share Application Money 0 Secured Loans 42178 Un Secured Loans 3184 46937 Cash flow A+B+C -355 Opening balance of cash&cash Equalents 703 closing balance of cash&cash Equalents 348
87
CHEMCEL BIOTECH LIMITED Registered Office : 16-130/12, JRD Tata Industrial Estate
Autonagar 3rd Cross Road Extn, Kanuru, Vijayawada-520 007
ATTENDANCE SLIP
PLEASE FILL ATTENDANCE SLIP AND HAND IT OVER AT THE ENTRANCE OF THE MEETING HALL
NAME AND ADDRESS OF THE SHARE HOLDER
Folio No. DP ID Cliend ID No.of Shares
I certify that I/We are member/proxy for the member of the Company. I /We hereby record my/our presence at the 15th ANNUAL
GENERAL MEETING of the Company to be held on Friday the 24th day of September 2010 at 4.00 PM at conference hall of
‘Silverspoon Hotel, Door no.59A-8-12B, Gurunanaknagar Colony Road, Vijayawada 520 008.
Signature of the Shareholder(s) or proxy.
-------------------------------------------------------------Please cut here-----------------------------------------------
CHEMCEL BIOTECH LIMITED Registered Office: 16-130/12, JRD Tata Industrial Estate
Autonagar 3rd Cross Road Extn, Kanuru, Vijayawada-520 007
Proxy Form
Folio No. DP ID Cliend ID No.of Shares
I / We __________________________ of _________________ in the district of _____________ ______________________________ being a
member/members of the Company hereby appoint ______________________ of __________________ in the district of ______________
or failing him _____________________ of ______________________ in the district of _______________ ___________ as my/our proxy to
vote for me / us on my/our behalf at the 15th ANNUAL GENERAL MEETING of the Company to be held on Friday the 24th day of
September 2010 at 4.00 PM at conference hall of ‘Silverspoon Hotel, Door no.59A-8-12B, Gurunanaknagar Colony Road, Vijayawada
520 008 or at any adjournment(s) thereof.
Signed this __________day of ______2010
Note: The proxy in order to be effective should be duly stamped, completed and signed and must be deposited at the Registered office of the company not less than 48 hrs before the time for holding the aforesaid meeting. The Proxy need not be a member of the company.
Affix Revenue Stamp of Re.1.00