Jai Balaji PDF

Jai Balaji Industries Limited
Annual Report 2012-13
Notice to the Shareholders

NOTICE IS HEREBY GIVEN THAT the Fourteenth Annual General Meeting of the Members of Jai Balaji Industries Limited will be held on Thursday, 12 th September, 2013 at 11.00 a.m. at Rotary Sadan (Shripati Singhania Hall), 94/2 Chowringhee Road, Kolkata 700 020 to transact the following business: ORDINARY BUSINESS 1. To receive, consider and adopt the Audited Balance Sheet as at 31st March, 2013 and Statement of Profit and Loss Account for the nine months/financial year ended on that date together with the Report of the Board of Directors and the Auditors thereon. To appoint a Director in place of Shri Satish Chander Gupta who retires by rotation and being eligible, offers himself for re-appointment. To appoint a Director in place of Shri Ashim Kumar Mukherjee, who retires by rotation and being eligible, offers himself for reappointment. To consider and if thought fit to pass with or without modification(s), the following resolution as an Ordinary Resolution. RESOLVED THAT subject to the provisions of Section 225 and other applicable provisions, if any, of the Companies Act, 1956, M/s. S. K. Agrawal & Co., Chartered Accountants, of 4A, Council House Street, Kolkata - 700 001 be and are hereby appointed as Auditors of the Company to hold office from the conclusion of this Annual General Meeting upto the conclusion of the next Annual General Meeting in place of the retiring Joint Statutory Auditors, M/s. U. Narain & Co., and M/s. Rashmi & Co. Chartered Accountants, for the financial year 2013-14 at such remuneration as may fixed by the Board of Directors and Audit Committee of Directors, apart from reimbursement of out of pocket expenses and taxes, as applicable. SPECIAL BUSINESS Item No. 5 To consider and, if thought fit, to pass, with or without modification(s), the following Resolution as an Ordinary Resolution: RESOLVED THAT Shri Shailendra Kumar Tamotia who was appointed by the Board of Directors as an Additional Director of the Company with effect from 15th May, 2013 and who holds office upto the date of this Annual General Meeting of the Company in terms of Section 260 of the Companies Act, 1956 and in respect of whom the Company has received a notice in writing from a member under Section 257 of the Companies Act, 1956, proposing his candidature for the office of Director of the Company, be and is hereby appointed as a Director of the Company, liable to retire by rotation. Item No. 6 To consider and, if thought fit, to pass, with or without modification(s), the following resolution as Special Resolution: RESOLVED THAT in accordance with the provisions of Sections 198, 269, 309, 310 of the Companies Act, 1956 and other applicable provisions, if any, of the Companies Act, 1956 and subject to the approval of such authorities as may be required, the Company hereby approves re-appointment of Shri Sanjiv Jajodia as Whole-time Director of the Company for a further period of 5 (five) years w.e.f. 1st May, 2013 on the terms, conditions and remuneration as mentioned in the agreement dated 22nd April, 2013, entered between the Company and Shri Sanjiv Jajodia, Whole-time Director. RESOLVED FURTHER THAT the terms & conditions of the said re-appointment and/or agreement may be altered and varied from time to time by the Board as it may be mutually agreed to between the Company and Shri Sanjiv Jajodia subject to the limits contained in the Companies Act, 1956. RESOLVED FURTHER THAT in case of losses or inadequate profits or for any other reasons as stated in Schedule XIII of the Companies Act, 1956, no remuneration shall be paid to Shri Sanjiv Jajodia, Whole-time Director or if payable shall be governed by the prevailing statutes in any financial year, during his tenure of office and that at present no remuneration is payable to Shri Sanjiv Jajodia till such time as may be decided by the Board. RESOLVED FURTHER THAT the Board be and are hereby authorised to file necessary forms with the Registrar of Companies and to take further steps to give effect to this resolution and to do all such act, deeds and things as may be necessary and incidental thereto for the said purpose.
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Registered Office: 5, Bentinck Street, Kolkata 700 001 Place : Kolkata Date : 12th August, 2013
By Order of the Board For Jai Balaji Industries Limited Ajay Kumar Tantia Company Secretary
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Notice to the Shareholders (Contd.)

Notes: 1. The relative Explanatory Statement pursuant to Section 173(2) of the Companies Act, 1956 in respect of business under item no. 5 and 6 of the notice is annexed hereto. 2. A MEMBER ENTITLED TO ATTEND AND VOTE AT THE MEETING IS ALSO ENTITLED TO APPOINT A PROXY TO ATTEND AND VOTE INSTEAD OF HIMSELF / HERSELF (ONLY ON A POLL) AND THE PROXY NEED NOT BE A MEMBER OF A COMPANY. THE DULY COMPLETED INSTRUMENT APPOINTING THE PROXY SHOULD, HOWEVER, BE DEPOSITED AT THE REGISTERED OFFICE OF THE COMPANY NOT LESS THAN 48 HOURS BEFORE THE COMMENCEMENT OF THE MEETING. 3. Quote the Folio/Client ID & DP ID Nos. in all correspondence. 4. Brief Profile of the Directors seeking appointment /re-appointment as mandated under Clause 49 of the Listing Agreement with the Stock Exchanges is annexed hereto. 5. The Register of Members and Share Transfer Books of the Company will remain closed from 7th September, 2013 to 12th September, 2013 (both days inclusive). 6. All the documents referred to in the accompanying notice are available for inspection at the Registered Office of the Company on all working days (except Saturdays, Sundays and holidays), between 11.00 A.M. to 1.00 P.M. upto the conclusion of this Annual General Meeting. 7. M e m b e r s s e e k i n g f u r t h e r information on the Accounts or any other matter contained in the Notice are requested to write to the Company at least 7 days before the meeting so that relevant information may be made available at the meeting. 8. Members whose shareholding is in electronic mode are requested to direct change of address and updates of savings bank account to their respective depository participants so as to receive dividend through NECs facility. 9. Members wishing to claim dividend, which remains unclaimed are requested to correspond with Shri Ajay Kumar Tantia, Company Secretary, at the Companys Registered Office. Members are requested to note that dividends not encashed or claimed within 7 (Seven) years from the date of transfer to the Companys Unpaid Dividend Account, will be transferred to the fund established by the Central Government, namely the Investor Education and Protection Fund (IEPF).
Information of such unclaimed/Unpaid amount, when due for transfer to the said fund, is given below: Financial Year Ended Date of Declaration of Dividend Unclaimed/ Unpaid Amount (in Rs.) 72,712.00 51,345.95 53,192.00 24,085.20 47,196.00 46,698.00 Last Date for Claiming Un-Paid/ Unclaimed Dividend 27.10.2013 01.11.2014 22.10.2015 19.10.2016 26.10.2017 20.10.2018 Due date for Transfer to IEPF 27.11.2013 01.12.2014 22.11.2015 19.11.2016 26.11.2017 20.11.2018
31.03.2006 31.03.2007 31.03.2008 31.03.2009 31.03.2010 31.03.2011
23.09.2006 27.09.2007 08.09.2008 15.09.2009 22.09.2010 21.09.2011
10. Members holding shares in physical form can avail of the nomination facility by submitting Form No. 2B of the Companies (Central Governments) General Rules and Forms, 1956 with the Company or its Registrar & Share Transfer Agent. Blank forms will be made available on request. In case of Shares held in Demat form, the nomination has to be lodged with their Depository Participant. 11. Members are requested to:q
and members holding shares in Physical form are requested to register their valid e-mail address with the Company at its registered office address or by sending an e-mail at jaibalaji@investordiary.in mentioning their name and folio no. Alternatively, a JAIBALAJI-Go Green Form is also available at the Companys website to enable the members holding shares in Physical form to register their e-mail address. 13. The Annual Report shall also be available at the Companys website www.jaibalajigroup.com . By Order of the Board For Jai Balaji Industries Limited Ajay Kumar Tantia Company Secretary Registered Office: 5, Bentinck Street, Kolkata 700 001 Place : Kolkata Date : 12th August, 2013
Bring their copy of Annual Report at the meeting. Deliver duly completed and signed Attendance Slip at the entrance of the meeting venue, for admission to the meeting hall.
12. Keeping in view the Circulars and Green Initiative in the Corporate Governance taken by the Ministry of Corporate Affairs, Members holding Shares in Demat form, who have not registered their e-mail address as of now, are requested to register the same with their respective Depository Participant
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Annexure to the Notice

Explanatory Statement Pursuant to Section 173 (2) of the Companies Act, 1956 Item No. 5 Shri Shailendra Kumar Tamotia was appointed as Additional Director of the Company w.e.f. 15th May, 2013 to hold office till the date of the ensuing Annual General Meeting. The Company has received a notice in writing under section 257 of the Companies Act, 1956, proposing the appointment of the said candidate as a Director of the Company. An Engineer by Profession, Shri Shailendra Kumar Tamotia, aged 73 years, has wide and varied experience in ferrous & non-ferrous metals sector spanning over 50 years with an impressive track record in management and implementation. He has worked with several Government / Public Sector Companies like Bhilai Steel Plant, Hindustan Steel Works Construction Limited & Kudremukh Iron Ore Company Limited. He has made professional contribution in the Aluminium Industry being Director (Production) CMD of National Aluminium Co. (NALCO) which improved the productivity and upgraded the technologies. He as a President & CEO of Indian Aluminium Company Limited (INDAL) led the Company to achieve growth in profits and doubling sales and exports. Presently working as Hon. Dean cum Director General & Vice Chairman of Bhavans Centre for communication and Management & Vice Chairman of Bhartiya Vidya Bhavan, Bhubaneswar Kendra. Over the years, he has received numerous national level awards for professional & business excellence including National Metallurgist Merit Award, Life Time Achievement Award presented by Various Authorities & Indo-Nepal Gold Star AwardEconomic growth Society of India. The Board of directors recommends the resolution mentioned in Item no. 5 to be passed as Ordinary Resolution. Except Shri Shailendra Kumar Tamotia, no other Director is concerned or interested in the said resolution. Item No. 6 The Board of Directors of the Company (the Board) at its meeting held on 22nd April, 2013 has approved the reappointment of Shri Sanjiv Jajodia as Whole-time Director of the Company in accordance with the provisions of Sections 198, 269, 309, 310 of the Companies Act, 1956 and other applicable provisions, if any, and subject to approval of the members and such other authorities as may be required, for a further period of 5 (five) years commencing from 1st day of May, 2013 and approved the terms and conditions of his appointment and remuneration. BRIEF PROFILE Shri Sanjiv Jajodia is presently on the Board of the flagship company of our group, Jai Balaji Industries Limited as a Whole-time Director. He is a Commerce Graduate and has more than two decades experience in Steel Industry. He has expertise in Corporate Finance, Accounts, Taxation, Corporate Governance, Statutory Compliance, Planning, System & Procedures, Audit, internal and Statutory Audit and Control. Shri Sanjiv Jajodia, son of Late Keshar Deo Jajodia joined Jai Balaji Industries Limited in 2002. He has been instrumental in shaping the corporate profile of the Company and in establishing the Company as a major Corporate House in the steel sector. Shri Sanjiv Jajodia is also a director on the Board of the some group companies.
The statement of particulars as per Clause 1(B)(IV) of Section II of Part II of Schedule XIII of the Companies Act, 1956 is as follows:
I. GENERAL INFORMATION 1) Nature of Industry 2) Date of commencement of commercial production 3) Financial performance Particulars 9 months period ended March 31, 2013 (`.) Iron & Steel Industry Year 2000 (Amount in Lacs) 15 months period ended June 30, 2012 (`.)
4) Export performance and net foreign exchange collaborations 5) Foreign investments or collaborators
Turnover 154,483.75 293,323.12 Profit/(Loss) (31,597.71) (38,884.08) before Tax Tax (10,286.40) (11,278.46) Profit /(Loss) after Tax (21,312.78) (27,605.62) EPS (33.42) (43.28) ` 688.18 lacs (Export at FOB Value) for the nine months period ended 31st March, 2013 NIL
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Annexure to the Notice (Contd.)

II. INFORMATION ABOUT THE APPOINTEE 1) Background details Shri Sanjiv Jajodia , son of Late Keshar Deo Jajodia joined Jai Balaji Industries Limited in 2002. He has been instrumental in shaping the corporate profile of the Company and in establishing the Company as a major Corporate House in the steel sector. ` 600,000/- p.m. Shri Sanjiv Jajodia is well known among industry circle as a highly successful entrepreneur. Shri Sanjiv Jajodia has expertise in Corporate Finance, Accounts, Taxation,Corporate Governance, Statutory Compliance, Planning, System & Procedures, Audit, Internal and Statutory Audit and Control. He has been instrumental in shaping the corporate profile of the Company and in establishing the Company as a major Corporate House in the steel sector. Rs. 600,000/- p.m. Remuneration proposed is commensurate to industry standards & profile of the candidate. Shri Sanjiv Jajodia holds 2,649,433 shares of the Company.
2) Past Remuneration 3) Recognition or awards 4) Job profile and his suitability
5) Remuneration proposed 6) Comparative remuneration profile with respect to industry, size of the Company, profile of the position and person 7) Pecuniary relationship directly or indirectly with the Company or relationship with the Managerial Personnel III. OTHER INFORMATION 1) Reasons of inadequate profits or loss 2) Steps taken or to be taken for improvement 3) Expected increase in productivity and profits in measurable terms
Due to inflation in cost of raw material, increase in borrowings cost and non availability of raw materials. Continuous efforts are being made to enhance productivity, cost and sales growth to improve profitability. The management expects the demand to improve further and it is expected that the production & demand would grow at a reasonable rate during the year. Note: The above expected demand & productions are forward looking statement within the meaning of applicable laws. Actual results could differ materially from those expressed or implied which are subject to various factors such as market factors, demand and supply conditions, changes in government policies, tax laws, etc.
As required under Section 302 of the Companies Act, 1956, an abstract of the main terms and conditions of the re-appointment of Shri Sanjiv Jajodia, as the Whole-time Director of the Company and memorandum of concern or interest of the directors are given below: EXTRACT PURSUANT TO SECTION 302 OF THE COMPANIES ACT, 1956 Terms and Conditions of Reappointment a) Salary:
` 6,00,000/- (Rupees Six Lac only)
b) i)
Perquisites and Allowances: Housing Fully furnished residential accommodation, owned leased or licensed by the Company OR, in lieu a house rent allowance @ 40% of the monthly salary.
hospitalization/nursing home and surgical charges for himself and family. The company shall pay necessary premium for maintenance of policies for himself and family for medical benefits. v) Personal Accident Insurance For self and family as per rules of the Company. vi) Leave Travel Concession For self and family as per rules of the Company. vii) Contribution to Provident Fund, Superannuation Fund and Annuity Fund The Companys contribution to Provident Fund, Superannuation Fund or Annuity Fund as per rules of the Company.
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Education Education expenses of dependent children not exceeding ` 50,000/- per month.
iii) Special Allowance Special Allowance ` 1,25,000/- per month. iv) Medical Benefits Reimbursement of actual medical expenses incurred in India/ abroad and including of
per month. (Annual increment of amount not exceeding ` 1,20,000/- per month, subject to the approval of Board.)
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viii) Gratuity Payable as per rules of the Company. ix) Leave Leave with full pay and allowances including encashment thereof as per rules of the Company. x) Club fees Reimbursement of membership fees for a maximum of two clubs including admission and life membership fees. xi) Statutory Obligation Payable as per rules of the Company Explanation Perquisites shall be valued as per the Income Tax Act, 1961 wherever applicable and in absence of any such Rules, perquisites shall be evaluated at cost. c) i) Amenities: Conveyance Facilities The company shall provide a car with driver or such other suitable conveyance facilities as may be required by the Whole-time Director for discharge of his duties. ii) Telephone and Other Communication Facilities The company shall provide telephone and other communication facilities to the Whole-time Director for official purposes. d) Other benefits Such other benefits, amenities and facilities as per the Companys rules. e) Reimbursement of Expenses Reimbursement of all entertainment, travelling, hotel and other expenses including foreign travel expenses for self and family incurred by the Wholetime Director during the course of or in connection with the business of the Company. f) Remuneration The above remuneration in any financial year shall not exceed the limits prescribed from time to time under section 198, 309 and other applicable provisions of the companies Act, 1956. The remuneration shall suspended till the time the Company is unable to satisfy the conditions specified in Part B Section II of part II of Schedule XIII of the Companies Act, 1956. None of the director, except Shri Sanjiv Jajodia and Shri Rajiv Jajodia, brother of Shri Sanjiv Jajodia, is concerned or interested in the contract of aforesaid appointment. The Board of directors recommends the resolution mentioned in Item no. 6 to be passed as Special Resolution. Note on appointment of M/s. S. K. Agrawal & Co., Chartered Accountants, as Statutory Auditors of the Company (Item No. 4) The Company has received a letter dated 27th July, 2013 from M/s. U. Narain & Co. and M/s. Rashmi & Co., Chartered Accountants, the Joint Statutory Auditor of the Company regarding their unwillingness to be reappointed at the ensuing Annual General Meeting, for the financial year ending 31st March, 2014. Hence the Board of Directors of the Company proposed, in its meeting dated 12 t h August, 2013 to appoint M/s. S. K. Agrawal & Co., Chartered Accountants, as the Statutory Auditor of the Company for the financial year ending 31st March 2014 subject to the approval of the members of the Company at the ensuing Annual General Meeting. The Company has received special notice of a resolution from a Member of the Company, in terms of the applicable provisions of the Act, signifying his intention to propose the appointment of M/s. S. K. Agrawal & Co., as the statutory auditors of the Company from the conclusion of the ensuing Annual General Meeting till the conclusion of the next Annual General meeting of the Company. M/s. S. K. Agrawal & Co., has expressed its willingness to act as statutory auditors of the Company, if appointed, and have further confirmed that the said appointment would be in conformity with the provisions of Section 224(1B) of the Act. The Members approval is being sought for the appointment of M/s. S. K. Agrawal & Co.,as the statutory auditors and to authorise the Board of Directors, on the recommendation of the Audit Committee, to determine the remuneration payable to them.
Registered Office: 5, Bentinck Street, Kolkata 700 001 Place : Kolkata Date : 12th August, 2013
By Order of the Board For Jai Balaji Industries Limited Ajay Kumar Tantia Company Secretary
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Annexure to the notice pursuant to Clause 49 of the Listing Agreement with the Stock Exchanges Brief Profile of Directors proposed to be re-appointment/seeking appointment at 14th Annual General Meeting Name Date of Birth Date of Appointment Qualification Shri Satish Chander Gupta 05th May, 1947 30th June, 2008 M.Com, CAIIB Shri Ashim Kumar Mukherjee 1st January, 1942 18th August, 2007 B. E. (Mining) & First class Mine Managers Certificate of Competency to manage a Metalliferious Mine (Restricted) 48 Years working experience in various capacities and areas in Mining of Ferrous Minerals 1) Nilachal Iron & Power Limited 2) Orissa Sponge Iron and Steel Limited Shri Shailendra Kumar Tamotia 25th September 1939 15th May, 2013 B.E. (Hons.), Civil Engineering M.E. (Soil Mech. & Foundation Engg.) & D. Engg. (Hons.) 50 years of experience in ferrous & non-ferrous metals industry NIL
Expertise in Specific functional area
Banking and Finance
Directorship held in other Public Companies
1) 2) 3) 4) 5) 6) 7) 8) 9)
Emmsons International Limited ISMT Limited Solar Industries Limited Gujrat Foils Limited Brahamputra Infra Projects Limited Brahamputra Infra Structure Limited SMC Global Securities Limited Orbit Corporation Limited Prudent Arc Limited
Chairmanship / Membership of the Committees of the Company
Audit Committee-Chairman
1) Audit Committee - Member 2) Remuneration Committee - Chairman 3) Shareholders/Investors Grievance Committee - Chairman 4) Management Finance Committee - Member 1) Audit Committee: Nilachal Iron & Power Ltd. - Member 2) Remuneration Committee : Nilachal Iron & Power Ltd. - Member
Audit Committee - Member
Chairmanship / Membership of Committees across other Public Companies
1) Audit Committee: Emmsons International Limited - Member ISMT Limited - Member Solar Industries Limited - Member 2) Remuneration Committee : ISMT Limited - Member NIL
NIL
No. of Equity Shares held in the Company
NIL
NIL
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Directors Report
Dear Members
Yours Directors are pleased to present the fourteenth Annual Report of your Company along with the audited accounts for the nine months financial year ended 31st March, 2013. FINANCIAL PERFORMANCE Particulars Nine months period ended March 31st, 2013 156,657.62 161,997.96 17,644.70 8,612.67 (31,597.71) --(31,597.71) --(31,597.71) --1.47 --10,286.40 (21,312.78) (33.42) (` in lacs) Fifteen months period ended June 30th, 2012 295,901.21 288,909.67 31,999.68 13,875.94 (38,884.08) --(38,884.08) --(38,884.08) ------11,278.46 (27,605.62) (43.28)
Income Less: Expenses Finance Costs Depreciation and amortization expenses Profit / (Loss) before exceptional and extraordinary items and Tax Less : Exceptional items Profit / (Loss) before extraordinary items and Tax Less : Extraordinary items Profit / (Loss) before Tax Less : Tax expense Current Tax MAT Credit Entitlement Deferred Tax Credit Profit/(Loss) after tax Earnings per share (Nominal value per share ` 10/-) Basic and Diluted
FINANCIAL HIGHLIGHTS During the year 2012-13, your company incurred loss which can be mainly attributable to raw material price inflation, rising borrowing costs and other global factors. The Loss before exceptional and extraordinary items and tax was ` 31,597.71 lacs as compared to loss of ` 38,884.08 lacs in the previous year. The net loss for the year under review (nine months) was ` 21,312.78 lacs againt loss after tax of ` 27,605.62 lacs in the previous year (fifteen months).
FINANCIAL YEAR The previous financial year, 2011-12 was extended by three months thereby ending on 30 th June, 2013. The Financial Year under reporting ended on 31st March, 2013, being a period of nine months, commencing on 1st July, 2012 ending on 31 st March, 2013. Henceforth, the financial year of the Company shall commence on 1st April and end on 31st March every year, if not otherwise decided by the Board in any particular financial year.
DIVIDEND In view of losses incurred and requirement of capital, considering the capital intensive nature of the industry, for the working of the Company, your Directors did not recommended dividend for the financial year 2012-13. PREFERENTIAL ISSUE During the year under reporting, no GDRs/ADRs/Warrants or any Convertible Instruments were issued.
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14th Annual Report 2012-13
Directors Report (Contd.)

However, the Company has issued and allotted on 4th July, 2013, 10,000,000 warrants to promoter group companies namely M/s. Enfield Suppliers Limited (1,900,000 warrants) and M/s. Hari Management Limited (8,100,000 warrants) on a private placement basis at an issue price of ` 50/- each. Each warrant is convertible into one equity share within a period of 18 months from the date of allotment, in one or more tranches, at a conversion price of ` 50/- per equity share (including a premium of ` 40/- per share), which is a price greater than the price determined as per Regulation 76 of Chapter VII of SEBI (ICDR) Regulations, 2009. The Board at its meeting held on 5th August, 2013, has fully and partly converted the said warrants, by way of allotment of 3,495,000 equity shares, being 1,900,000 equity shares to M/s. Enfield Suppliers Limited and 1,595,000 equity shares to M/s. Hari Management Limited, pursuant to their respective application for conversion of warrants. After the said conversion, the equity share capital of your company stands at ` 67,264,860/divided into 6,726,486 equity shares of ` 10/- each. After the full conversion of remaining warrants, if exercised, the equity capital of the Company will increase to ` 737,814,860/-. The shares so issued shall rank pari-passu in all respects, including as to dividend, with the existing shares of the Company. EXPANSION & PROJECTS Your Company continues its journey to deliver value for customers and to all the stakeholders of the Company by improving its performance in safety, quality, productivity, environment and people development through knowledge transmission. During the year under reporting, your companys project for expansion of 350000 MTPA Coke Oven Plant along with Waste Heat Recovery Boiler of 80 TPH completed and capitalised. The said coke oven plant is presently running satisfactorily. The DRI Plant of 60000 MT & coal washery in subsidiary company M/s Nilachal Iron & Power Limited started its commercial production during the year under review. The Dumri Coal Block has also received Environmental clearance and Forest Go Certificate. Forest clearance stage one has been received and stage two is under process. The Companys products meet stringent quality parameters and which is gaining market share comprising of private, institutional, non-institutional and government body buyers. This achievement highlights the technical and project execution skills of the management of your Company to successfully execute large projects within record time. CORPORATE DEBT RESTRUCTURING Your Companys Corporate Debt Restructuring scheme, which was approved vide letter of approval dated 20 th September, 2012 from CDR Empowered Group/CDR Cell, has been implemented during the year. SUBSIDIARIES Your Company continues to have three wholly owned subsidiaries namely, M/s. Nilachal Iron & Power Limited, M/s. Jai Balaji Steels (Purulia) Limited & M/s. Jai Balaji Energy (Purulia) Limited.
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manufacturing plant located in Kandra near Jamshedpur, Jharkhand. Currently, it manufactures sponge iron, and work on increasing its capacity by 60,000 tonnes per annum has been initiated. The company has been allotted the Dumri Coal Block for captive mining from the Government of India, about 300 kms from the plant.
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Jai Balaji Steels (Purulia) Limited Wholly owned subsidiary of the Company. It did not commence commercial production as on the date of reporting.
Jai Balaji Energy (Purulia) Limited Wholly owned subsidiary of the Company. It did not commence commercial production as on the date of reporting. The Audited Balance Sheet and Statement of Profit & Loss Account along with the respective Reports of the Board of Directors and the Auditors Report thereon of the said subsidiaries, wherever applicable, for the financial year ended 31st March, 2013 are attached in terms of Section 212 of the Companies Act, 1956. A statement relating to amount of profit/(loss) of subsidiaries, dealt with and not dealt with in the Companies account, as per Section 212 of the Companies Act, 1956 is also provided in this report.
JOINT VENTURES Your Company continues to have two Joint Venture Companies namely, M/s. Andal East Coal Company Private Limited and M/s. Rohne Coal Company Private Limited.
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Nilachal Iron & Power Limited
A wholly owned subsidiary of your Company since 26.10.2007, having its
Andal East Coal Company Private Limited A Joint Venture Company
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M/s Andal East Coal Company Private Limited was formed in 2009-10 with the Registrar of Companies, West Bengal, in which the Company along with M/s Bhushan Steel Limited and M/s Rashmi Cement Limited are venture partners. The said Joint Venture Company was formed in terms of allocation of Andal NonCoking Coal Block in the State of West Bengal by Ministry of Coal, Government of India.
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fees for the year 2013 2014 to the National Stock Exchange of India Limited (NSE), BSE Limited (BSE) and The Calcutta Stock Exchange Limited (CSE). DEMATERIALISED SHARES The dematerialised shares of the Company are maintained by National Securities Depository Limited (NSDL) and Central Depository Services (India) Limited (CDSL). The company has paid the annual fees for the year 2013-2014 to the NSDL and CDSL. PROSPECTS The global economy appears to be transitioning toward a period of more stable but slower growth. The economic conditions improved modestly in the third and fourth quarter of 2012, however, a broad set of indicators for global industrial production and trade suggests that global growth did not strengthen further. A sharp pullback in demand of steel in the third quarter has pushed up steel consumption in the fourth quarter. Steel industry is vital for overall economic development of every nation as it is one of the core sectors. Despite all the headwinds and lingering difficulties steel industry has delivered robust growth rate. However their projects after hitting several road blockades are yet to generate output. The steel sector contributes to nearly 2 percent in the GDP and employs over 5 lakh people. Indian Steel industry is poised for greater growth catapulating India to the league of highest steel consuming nations of the world in the next decade. The Indian economys outlook for 201314 can be viewed as cautiously optimistic. Backed by policy actions announced in the recent budget, it is
projected that India would return to the robust growth path of 7-8% over the next two to three years. Though the Steel demand was low in 2012-13 due to continuing economic crisis, however, spurt in demand is expected in 201415. Domestic steel demand is expected to be muted in 2013-14 and profit margins in financial year 2013-14 to remain broadly similar to the financial year 2013-14. This is mainly due to persistent high cost of steel production. Your company reasonably believes that the turbulent conditions during the year under review, which did not allow the potential of the operations to be fully realized, will not be a lasting phenomenon. In order to secure its long-term competitive position, your Company will continue to focus on its growth strategies. PARTICULARS OF CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO The relevant information pursuant to Section 217(1)(e) of the Companies Act, 1956, read with the Companies (Disclosures of Particulars in the Report of Board of Directors) Rules, 1988, pertaining to conservation of energy, technology absorption and foreign exchange earnings and outgo are given in the Annexure forming part of this Annual report. INSTALLED CAPACITY AND ACTUAL PRODUCTION Your company has an integrated steel plant and manufactures different products in Steel sector. The Companys cumulative product wise installed capacity and actual production comprise of the following:
Rohne Coal Company Private Limited A Joint Venture Company M/s. Rohne Coal Company Private Limited was formed in 2008-09 with the Registrar of Companies, NCT of Delhi & Haryana, in which the company along with M/s. JSW Steel Limited & M/s. Bhushan Power & Steel Limited are venture partners. The said Joint Venture Company was formed in terms of allocation of Rohne-Coking Coal Block in the State of Jharkhand by Ministry of Coal, Government of India. Both the Joint Venture Companies are in the process of setting up coal mining facilities at respective coal blocks.
LISTING The equity shares continue to be listed on the National Stock Exchange of India Limited (NSE), BSE Limited (BSE) and The Calcutta Stock Exchange Limited (CSE). Both NSE and BSE have nationwide terminals which enable the shareholders / investors to trade in the shares of the Company from any part of the country without any difficulty. The Company has paid annual listing
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Product Annual Installed Capacity (M.T.) 2012-13 Sponge Iron Pig Iron Steel Bars/Rods Billet/MS Ingot Ferro Alloys Ductile Iron Pipe Power Sinter Coke 345,000 509,250 260,000 906,230 106,618 240,000 101.10 (MW) 608,000 350,000 2011-12 345,000 509,250 260,000 906,230 106,618 240,000 101.10 (MW) 608,000 --Actual Production (M.T.) # 2012-13 (Nine Months) 136,419 208,010 60,518 262,920 29,305 41,449 217.48 (MU) 382,223 100,056 2011-12 (Fifteen Months) 262,293 498,803 97,850 420,223 68,746 91,788 505.91 (MU) 795,643 --Accounting Standard 21 and 27 issued by the Institute of Chartered Accountants of India, are attached as a part of the Annual Report. AUDITORS The Joint statutory auditors of your Company, M/s. U. Narain & Co., Chartered Accountants, and M/s. Rashmi & Co., Chartered Accountants, retire at the conclusion of the ensuing Annual General Meeting and have expressed their unwillingness to be reappointed as statutory auditors. The Company has received a notice from a shareholder under Section 225 of the Companies Act, 1956 nominating M/s. S. K. Agrawal & Co., Chartered Accountants of 4A, Council House Street, Kolkata-700 001, as Statutory Auditors of the Company. The said M/s. S. K. Agrawal & Co., Chartered Accountants have given their consent to act as Statutory Auditors of the Company, if appointed, and has further confirmed that the said appointment would be in conformity with the provisions of Section 224(1B) of the Companies Act, 1956. Your directors recommend appointment of M/s. S. K. Agrawal & Co., as Statutory Auditors of the Company to hold office from the conclusion of the ensuing Annual General Meeting tiil the conclusion of the next Annual General Meeting. AUDITORS REPORT The observations made in the Auditors Report read with Notes to Accounts are self-explanatory and therefore, do not call for any further elucidation. COST AUDITORS Your Board has appointed M/s. Mondal & Associates, Proprietor Mr. Amiya Mondal as Cost Auditor of the Company in accordance with the provisions of Section 233B of the
# includes production for third party conversion 4,499 M.T (14,101 M.T.) and NIL (6,674 M.T.) in respect of Ferro Alloy and Steel Bars/Rods respectively. # Coke oven production includes trial run production 81,808 M.T. DIRECTORS RESPONSIBILITY STATEMENT In terms of the provisions of Section 217(2AA) of the Companies Act, 1956, your Directors hereby confirm that: i) In the preparation of annual accounts, the applicable accounting standards have been followed; INFORMATION PURSUANT TO SEC 217 OF THE COMPANIES ACT, 1956 The Company does not have any employee whose particulars are required to be furnished under Section 217(2A) of the Companies Act, 1956, read with Companies (Particulars of Employees) Rules, 1975, as amended from time to time. CORPORATE GOVERNANCE AND MANAGEMENT DISCUSSION AND ANALYSIS Your company has complied with the requirements of Clause 49 of the Listing Agreement regarding Corporate Governance. A report on the Corporate Governance practices, the Auditors Certificate regarding compliance of the conditions of Corporate Governance, and Management Discussion and Analysis are annexed to this report. CONSOLIDATED FINANCIAL STATEMENTS In terms of Clause 32 of the Listing Agreement with the Stock Exchanges, the duly audited Consolidated Financial Statements, conforming to
ii) T h e y h a v e s e l e c t e d s u c h accounting policies and applied them consistently and made judgements and estimates that are reasonable and prudent, so as to give a true and fair view of the statement of affairs of the Company as at 31st March, 2013 and of the loss of the Company for the year ended on that date; iii) They have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956, for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities; and iv) The annual accounts have been prepared on a going concern basis.
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Companies Act, 1956 read with Cost Accounting Records (Steel Plant) Rules, 1990, The Companies (Cost Accounting Records) Rules, 2011, The Companies (Cost Audit Report) Rules, 2011, and relevant circulars issued by the Ministry of Corporate Affairs, to carry out audit of cost records of the Company for the financial year 2013-14. The same has subsequently been approved by the Central Government. COST AUDIT REPORT The Company has filed the Cost Audit Report for the financial year 2011-12 with the Registrar of Companies, Ministry of Corporate Affairs in the prescribed form. DIRECTORS In accordance with the provisions of the Companies Act, 1956, and the Companys Articles of Association, Shri Satish Chander Gupta and Shri Ashim Kumar Mukherjee, Directors, retire by rotation at the ensuing Annual General Meeting and being eligible, offer themselves for re-appointment. The Board has re-appointed Shri Sanjiv Jajodia, whose term as the Whole-time Director of the Company expired on 30th April, 2013, as the Whole-time Director for a further period of 5 (five) years with effect from 1st May, 2013, subject to the approval of shareholders and on the terms and conditions as specified in the agreement entered into between Shri Sanjiv Jajodia and the Company. Your Directors appointed Shri Shailendra Kumar Tamotia w.e.f. 15 th May, 2013 as an Additional Directors of the Company. He shall hold office upto the date of ensuing Annual General Meeting. The Company has received a notice under Section 257 of the Companies Act, 1956 proposing the candidature of Shri Shailendra Kumar Tamotia as Director of the Company. In view of his vide experience and qualifications your Directors recommend his appointment. Shri Shailendra Kumar Tamotia, if appointed, will continue to act as an independent director of the Company. Shri Krishnava S. Dutt and Shri Gourav Jajodia have resigned from the directorship of the Company with effect from 14th May, 2013 and 5th August, 2013, respectively. The Board wishes to place on record its sincere appreciation for the valuable contribution rendered by Shri Krishnava S. Dutt and Shri Gourav Jajodia during their tenure. A brief resume of the Directors seeking reappointment and appointment in the ensuing Annual General Meeting is incorporated in the Notice of the ensuing Annual General Meeting. HUMAN RESOURCE MANAGEMENT The Company is dedicated to have an optimum level of human resource and believes in the concept of right talent at the right job. We nurture our human resource and provide them a growth oriented and challenging work environment thereby achieving our organisational goals. The Company acknowledges the tremendous contribution of all its employees towards its growth in leading, thinking, working, motivating, etc. The management continuously urges for building harmonious relations and strengthening the human resource system by making available better tools, technology and techniques at the workplace to maximise the skills of the workforce. The Company gives proper opportunities to its employees to improve their skills leading to consistent improvements in systems as well as to ensure the Company has the right competency in its workforce. CORPORATE SOCIAL RESPONSIBILITY Corporate Social Responsibility is viewed by company as operating a business in a manner that meets or exceeds the ethical, legal, commercial and public expectations that society has of business by contributing to economic development and improving the quality of life of the workforce and their families as well as of the local community and society at large. As part of its policy for corporate social responsibility, the Company undertakes a range of activities to improve living conditions of people in the neighbourhood of all its plants. These activities include environment protection, healthcare, education, rural development and some of the activities undertaken during the year are as under:
y Environment
s
Plantation of trees in and around the manufacturing plants and in the adjoining villages. Water sprinkling on road at nearby villages. Cleaning and maintaining of plantation area at nearby villages.
y Healthcare
s s
Distribution of free medicines. Provides ambulance services for nearby villagers in emergency conditions.
y Rural Development
s
Maintaining street lights at nearby villages.
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Financial assistance for providing water and electricity.
shall consistently strive to touch lives and make a difference. ACKNOWLEDGEMENT Your Directors take this opportunity to place on record their sincere gratitude to its customers, dealers, suppliers, investors, members, financial institutions/banks, Central Government, State Government, all regulatory and government authorities and all other business associates for their continued support and cooperation extended by them to the Company. Your Directors express deep appreciation for excellent contribution
y Social
s
Provided financial assistance by way of donations to various local agencies during festive occasions. Provided financial help to District Sainik Welfare. Provided financial assistance for organisation of sports championships.
of the employees, workers, staff and executives of the Company by means their sincere and dedicated hard work during the year under review which has been instrumental to the growth of your company.
On behalf of the Board of Directors Aditya Jajodia Chairman & Managing Director Place: Kolkata Date: 12th August, 2013
Corporate Social Responsibility and Sustainable development will continue to remain one of the leading priorities of your Company through which it
12

Annexure to Directors Report

Information under Section 217(1)(e) read with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988 and forming part of the Directors Report for the year ended 31st March, 2013: A. Conservation of energy: (a) Energy conservation measures taken: The Company is committed to conserve energy and making best use of the resources. A considerable amount of time and effort was earmarked for conserving power across all our plants. The measures undertaken were namely:
q q q
Modification in Capacitor bank of furnace to improve Power Factor to >0.95. Use of compact fluorescent lamps and lightning in place of conventional lights Exercise to check the connected electricity machines (motors etc.) against actual loading and necessary measures taken to optimise the over capacity selection Merger of 10 MVA & 22 MVA DVC power Cross checking of motor rating, avoiding overrated if any and its proper maintenance and avoiding idle running. Replacement of lesser efficiency capacitor to maintain the power factor. ACC Fins cleaning which increases the heating surface area and increases the efficiency (Power Division). Ash handling system modification and upgradation resulting to reduction in air consumption. Thus, electricity required is reduced in Air compressors. Utilization of Dolochar in AFBC Boilers. Plant Lighting modification: 1) Including reduction in all incandescent bulbs and halogen. 2) Converted outdoor lighting to low power efficient sodium lamps. 3) optimise outdoor decorative lighting 4) Air conditions set at moderate temperature to keep comfortable temperature with more power saving
q q q q q
q q
Yearly cleaning of Waste Heat recovery boiler tubes to remove sludge deposition in it to increase the Boiler efficiency.
(b) Additional investments and proposals, if any, being implemented for the reduction of consumption of energy: Investment for purchasing capacitor banks, power merger, optimisation of motor rating. (c) Impact of the measures at (a) and (b) above for reduction of energy consumption and consequent impact on the cost of production of goods: With the implementation of above measures, there will be effective utilisation of waste-by-product like dolachar utilized in AFBC boilers, effective utilisation of waste heat used in power plant production and saving in electrical energy resulting in lowering of cost of production. Apart from the above the following factors may be noted:
q q q q
Capacitor Bank helps in reduction of power losses thereby maintaining the power factor. Saving in electricity consumption by keeping the ACs temperature at moderate level Keeping ACs in optimum temperature results in saving electricity used for plant maintenance. 35000 KWH approx saving per month in upgraded ash handling system and air compressors
(d) Total energy consumption and energy consumption per unit of production as per Form A of the Annexure is annexed. B. Technology absorption: The details of efforts made towards absorption of technology are given separately in the Report in Form B. C. Foreign exchange earnings and outgo: Activities relating to exports, initiatives taken to increase exports, development of new export markets for products and services and export plans
13

Annexure to Directors Report (Contd.)

Continuing efforts are made to increase the exports by exploring, creating and developing new markets for its products. The key focus is to serve a wide range of industries and to end customers with focus on high share of business. Specific initiatives were taken in the area of enhancing customer relationship, improved processes, new product, new market and infrastructure development. (a) Total foreign exchange used and earned
2012-13 (nine months) i) Foreign currency used ii) Foreign currency earned 22,747.64 688.18
2011-12 (fifteen months) 34,069.97 4,540.75
The foreign currency earnings decreased during the year as compared to the previous year was mainly due to global recession, decreased value of rupee and other factors. FORM - A Form for disclosure of particulars with respect to conservation of energy A. Power and fuel consumption: Particulars Electricity a) Purchased Units (in lacs) Total amount (Rs. in lacs) Rate per unit (Rs.) b) Own generation i) Through diesel generator Units (in lacs) Units per litre of diesel Cost per unit (Rs.) ii) Through power plant Units (in lacs) Total amount (Rs. in lacs) Cost per unit (Rs.) B. Electricity consumption per unit (MT) of production: Particulars Sponge iron (Units) Billet/MS ingots (Units) Ferro alloys (Units) Pig iron (Units) Steel bars/rods (Units) Ductile Iron Pipe (Units) Sinter (Units) Coke (units) 2012-13 (nine months) 104 927 6,064 145 119 504 39 77 2011-12 (fifteen months) 111 668 6,319 133 131 437 28 --2,124.57 12,305.40 5.79 4,554.59 14,371.07 3.15 1.10 3.72 12.38 1.44 2.88 14.84 3,041.85 12,848.42 4.22 4,081.07 17,918.52 4.39 2012-13 (nine months) 2011-12 (fifteen months)
14

Annexure to Directors Report (Contd.)

FORM - B Form for disclosure of particulars with respect to technology absorption. Research and Development (R&D) 1. Specific areas in which R&D was carried out by the Company:No R&D was carried out during the year within the meaning of applicable accounting standards. 2. Benefits derived as a results of the above R&D:Improvement in load factor by better utilisation of power. 3. Future plan of action:q q q q
Improvement in productivity Reduction in wastage Energy conservation measures Safer environment
4. Expenditure on R&D:In view of established accounting practice the cost associated with the Research and Development has been merged with the respective account heads. Technology absorption, adaptation and innovation: a) Efforts, in brief, made towards technology absorption, adaptation and innovation. Your company has always been aware of the latest technological know how and development and adopted them to the best possible extent to attain high levels of quality. The company continued its efforts towards improvement in the existing production process, energy conservation and waste utilisation. b) Benefits derived as a result of the above efforts. As a result of the above there was product improvement and saving in process costs c) In case of imported technology (imported during the last five years reckoned from the beginning of the financial year), the following information may be furnished : (i) Technology imported (ii) Year of import (iii) Has technology been fully absorbed (iv) If not fully absorbed, areas where this has not taken place, reasons thereof and future plans of action : : : : Nil Not applicable Not applicable Not applicable
15

Report of the Directors on Corporate Governance

1. COMPANYS PHILOSOPHY Code of Governance Corporate Governance is all about maintaining a valuable relationship and trust with all the stakeholders. Good corporate governance ensures that we engage in democratic and open process and are held accountable for our business decisions. It is basically an ethically driven business process that is committed to values and conduct aimed at enhancing an organisations wealth generating capacity. Your Company is committed to conduct business in accordance with the highest ethical standards and sound Corporate Governance Reports. Our company believes that any business conduct can be ethical only when it rests on the values like honesty, fairness, trust and integrity. Our governance practices stem from an inherent desire to improve and innovate and are driven by experienced board, timely disclosures, and transparent accounting policies and high level of integrity in decision making. We have tried to blend growth and efficiency with governance and ethics. Our Board of Directors formulate strategies and policies having focus on optimizing value for various stakeholders like consumers, shareholders and the society at large. Compliance with Corporate Governance Guidelines The Company is in compliance with the requirements of the prevailing and applicable Corporate Governance Code. The Companys compliance in terms of Clause 49 of the Listing Agreement executed with the Stock Exchanges is presented in the subsequent sections of this report. 2. BOARD OF DIRECTORS The Companys policy towards composition of Board is in terms of Corporate Governance Policy of the Listing Agreement, as amended from time to time. The Board is headed by a Executive Chairman and consists of a combination of executive & non-executive directors and independent directors. As on 31st March, 2013, the Board consists of 9 directors, out of which:
q q q q
2 are Promoter Executive Directors, 1 is Executive Director, 2 are Promoter Non-Executive Directors and 4 are Independent NonExecutive Directors.
During the financial period 2012-13 being a period of 9 months, 6 (Six) meetings of the Board were held viz., 20th July, 2012; 14th August, 2012; 28 th September, 2012; 4 th October, 2012; 9th November, 2012 and 12 th February, 2013. The maximum time gap between two consecutive board meetings did not exceed four months.
The details of composition of the Board of Directors i.e. their names and category, their attendance at Board meetings during the financial year 2012-13 and at the last Annual General Meeting and the number of other directorship(s) and Board committees membership(s)/chairmanship(s) are as follows: Name of Directors Category Attendance Particulars Board Meetings Shri Aditya Jajodia (Chairman & Managing Director) Shri Sanjiv Jajodia (Whole-time Director) Shri Rajiv Jajodia Shri Gourav Jajodia*** Shri Ashim Kumar Mukherjee Shri Shyam Bahadur Singh* Shri Satish Chander Gupta Shri Krishnava S. Dutt** Shri Amit Kumar Majumdar Promoter Executive Director 6 Last AGM Yes Number of directorship and committee membership / chairmanship Other Committee Committee Directorship(s) Membership(s) Chairmanship(s) 9 ---
Promoter Executive Director Promoter NonExecutive Director Promoter NonExecutive Director Independent NonExecutive Director Executive Director Independent NonExecutive Director Independent NonExecutive Director Independent NonExecutive Director
5 4 3 6 6 4 2 6
Yes Yes -Yes Yes Yes ---
11 7 4 2 1 9 4 3
---1 -3 -2
2 -1 ---1 --
*Appointed as executive director w.e.f 1st October, 2012 **Resigned w.e.f. 14th May, 2013 ***Resigned w.e.f. 5th August, 2013
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Report of the Directors on Corporate Governance (Contd.)

As required by Clause 49 IV (G) of the Listing Agreement the details of the directors seeking appointment/ re-appointment in Fourteenth Annual General Meeting are given in the notice to the Annual General Meeting. Shri Krishnava S. Dutt and Shri Gourav Jajodia have resigned from the Board w.e.f 14th May, 2013 and 5th August, 2013 respectively. Shri Shailendra Kumar Tamotia have been appointed as an additional director w.e.f. 15th May, 2013. As per declarations received by the Company, none of the independent 3. BOARD COMMITTEES The Board has constituted the following Committees of Directors:
s
directors/non-promoter directors are related to each other or to the promoters in terms of the definition of relative given under the Companies Act, 1956. Further, Shri Rajiv Jajodia and Shri Sanjiv Jajodia are related as brothers and Shri Aditya Jajodia and Shri Gourav Jajodia are their brothers son. None of the Directors on the Board is a member of more than 10 Board-level committees and Chairman of more than 5 committees as specified in Clause 49 I (C) of the Listing Agreement across all the Companies in which he is a director.
Membership(s)/Chairmanship(s) of only the Audit Committee and Shareholders/Investors Grievance Committee of all Public Limited Companies (excluding Jai Balaji Industries Limited) have been considered. Number of other directorships held by the Directors, as mentioned above, do not include alternate directorship, directorships of private companies, Section 25 companies and of companies incorporated outside India and are based on the latest declarations received from the Directors.
Audit Committee The Company has an Audit Committee at the Board level, which acts as a link between the management, the statutory and internal auditors and cost auditor and the Board of Directors. The composition of the Audit Committee is in line with the requirements of Clause 49 of the Listing Agreement. The Committee is headed by Shri Satish Chander Gupta, an Independent Non-Executive Director of the Company. The Audit Committee as on 31st March, 2013, comprises of 6 Directors, out of which:
q q q
4 are Independent Non-Executive Directors, 1 is Executive Director and 1 is a Promoter Executive Director.
During the financial period 2012-13 being a period of 9 months, 4 (Four) meetings of the Audit Committee were held viz.,14th August, 2012; 4th October, 2012; 9th November, 2012 and 12th February, 2013. The necessary quorum was present at the meeting. The Company Secretary, Shri Ajay Kumar Tantia, acts as the Secretary to the Audit Committee. The Composition of the Committee and the attendance at the meetings of the Committee during the financial year 2012-13 are given below: Name of the Members Shri Satish Chander Gupta Shri Aditya Jajodia Shri Ashim Kumar Mukherjee Shri Shyam Bahadur Singh Shri Krishnava S Dutt (resigned w.e.f. 14.05.2013) Shri Amit Kumar Majumdar Designation Chairman Member Member Member Member Member No. of meetings attended 3 4 4 4 2 4
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Shri Krishnava S Dutt ceased to be the member of Audit Committee upon his resignation from the Board w.e.f 14th May, 2013. Shri Shailendra Kumar Tamotia has been inducted in the Audit Committee as member w.e.f 15th May, 2013. All the members of the Committee are financially literate and having insight to interpret and understand financial statements and also have accounting and financial management expertise. The meetings of the Audit Committee were also attended by the representatives of the Joint Statutory Auditor & Internal Auditor, Chief Financial Officer (CFO) and other Executives as considered appropriate. Minutes of the Audit Committee meetings are placed and discussed in length before the Board. The Chairman of the Audit Committee Shri Satish Chander Gupta was present at the last Annual General Meeting. The Audit Committee has been mandated with the same terms of reference as specified in the revised Clause 49 of the Listing Agreement with the Stock Exchanges and covers all aspects stipulated by the SEBI guidelines. The terms of reference also fully confirm to the requirements of Section 292A of the Companies Act, 1956. The terms of reference of the Audit Committee are as follows:1. Overseeing the companys financial reporting process and the disclosure of its financial information to ensure that the financial statement is correct, sufficient and credible. 2. Recommending to the Board, the appointment, re-appointment and if required, the replacement or removal of the Statutory Auditor Cost Auditor and Internal Auditor and fixation of their remuneration and other payments. 3. Approval of payment to Statutory Auditors for any other services rendered by the Statutory Auditors. 4. Reviewing with the management, the annual financial statements before submission to the Board for approval, with particular reference to: a. Matters required to be included in the Directors Responsibility Statement to be included in the Boards Report in terms of clause (2AA) of section 217 of the Companies Act, 1956; b. Changes, if any, in accounting policies and practices and reasons for the same; c. Major accounting entries involving estimates based on the exercise of judgment by management; d. Significant adjustments made in the financial statements arising out of audit findings; e. Compliance with listing and other legal requirements relating to financial statements; f. Disclosure of any related party transactions; and g. Qualifications in the draft audit report. 5. Reviewing with the management, quarterly, half yearly and annual financial results before submission to the Board for approval including a statement of assets and liabilities as at the end of the half-year and/or as at the end of the financial year. 6. Reviewing, with the management, the statement of uses/application of funds raised through an issue (public issue, rights issue, private placement etc.). 7. Reviewing, with the management, performance of statutory and internal auditors, adequacy of the internal control systems. 8. Reviewing the adequacy of internal audit function including the frequency of internal audit. 9. Discussion with internal auditors any significant findings and follow up there on. 10. 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. 11. 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. 12. 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. 13. Reviewing any related party transaction i.e., transaction with the Company of material nature, key managerial personnel (KMP), relatives of KMP, enterprises over which the KMP possess significant influence, etc., that may have potential conflicts with the interest of the Company at large. 14. Approval of appointment of Chief Financial Officer or any other person heading the finance function or discharging that function after assessing the qualifications, experience & background, etc. of the candidate. 15. Reviewing transactions with Subsidiaries, Joint Ventures etc. 16. Reviewing the financial statements of the unlisted subsidiary companies. 17. Carrying out any other functions as mentioned in the terms of reference of the Audit Committee. The Audit Committee is empowered, pursuant to its terms of reference, I. To investigate any activity within its terms of reference.
II. To seek information from any employee. III. To obtain outside legal or other professional advice. IV. To secure attendance of outsiders with relevant expertise, if it considers necessary.
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Remuneration Committee The Remuneration Committee constituted in pursuance of the provisions of the Listing Agreement and Schedule XIII to the Companies Act, 1956. The Committee is headed by Shri Ashim Kumar Mukherjee, an Independent Non-Executive Director of the Company. As on 31st March, 2013 the committee comprises of 4 directors of which 3
are Independent Non-Executive Directors and one Executive Director. The broad terms of reference of the Committee are to discuss, approve and recommend the appointment, re-appointment of Executive Directors and also to fix their remuneration packages for approval by the Board as well as
the shareholders. Remuneration paid to the Directors is in compliance with Schedule XIII of the Companies Act, 1956. During the financial period 2012-13 being a period of 9 months, 2 (Two) meetings of the Remuneration Committee were held viz., 20th July, 2012 and 4th October, 2012. The necessary quorum was present at the meeting.
The Composition of the Committee and the attendance at the meetings of the Committee during the financial year 2012-13 are given below: Name of the Members Shri Ashim Kumar Mukherjee Shri Shyam Bahadur Singh Shri Satish Chander Gupta Shri Amit Kumar Majumdar Remuneration policy/Criteria of payments: The remuneration determined for the Executive/Non-executive Director is subject to the approval of the Board of Directors and the Members.
n
Designation Chairman Member Member Member Director and Shri Sanjiv Jajodia, Whole-time Director are for a period of 5 years from their respective dates of appointment. Shri Shyam Bahadur Singh was appointed as an Executive Director w.e.f. 1st October, 2012. There is no separate provision for notice period & payment of severance fees. The Company does not also have any Salary NIL NIL 1,80,000 1,80,000
No. of meetings attended 2 2 1 2
Executive Directors: The tenure of office of Shri Aditya Jajodia, Chairman and Managing Name of the Directors Shri Aditya Jajodia Shri Sanjiv Jajodia Shri Shyam Bahadur Singh* Total
scheme for grant of Stock Options to its Directors, Managing Directors or other employees. The Company pays remuneration by way of salary, benefits, perquisites and allowances to its Executive Directors. The details of remuneration paid to the Executive Directors for the financial year 2012-13 are as follows: (`) Total NIL NIL 4,50,000 4,50,000
Benefits/Allowances, etc. (fixed component) NIL NIL 2,70,000 2,70,000
*Remuneration from 1st October, 2012 to 31st March, 2013.
In the event of being no profits or inadequate profits, the Managing Director and Whole - time Director has waived off their remuneration for the Financial Year 2012-13.
n
Non-Executive Directors: The Non-Executive Directors do not draw any remuneration from the Company other than sitting fees for attending each Board Meeting. At present no sitting fees is paid for attending committee meetings. The Company also reimburses the out-of-pocket expenses incurred by the Directors for attending meetings. Your Company pays Service Tax under Reverse Charge Mechanism for services received from its Directors as per the rule 2(1)(d)(EE) of the Service Tax Rules and Notification No. 30/2012 dated 20.06.2012 issued by the Government of India, Ministry of Finance (Department of Revenue) amended
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w.e.f. 7th of August, 2012. The details of sitting fees (including TDS) paid to the Non - Executive Directors for the financial year 2012-13 are as follows: Name of the Directors Sitting Fees (including TDS) (`) 20,000 15,000 30,000 20,000 20,000 10,000 30,000 145,000
Shri Rajiv Jajodia Shri Gourav Jajodia Shri Ashim Kumar Mukherjee Shri Shyam Bahadur Singh Shri Satish Chander Gupta Shri Krishnava S Dutt Shri Amit Kumar Majumdar Total
The Non-Executive Directors did not have any other material pecuniary relationship or transactions with the Company. The details of equity shares of the company held by the Non-Executive Directors as on 31st March, 2013 are as follows: Name Shri Rajiv Jajodia Shri Gourav Jajodia No. of shares held in the Company 1,568,333 119,666
All other Non-Executive Directors excluding the above do not hold any shares or convertible instruments of the Company.
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Shareholders Committee The Board has constituted the Share Transfer cum Investor Grievance Committee at the Board level to deal with various matters relating to redressal of shareholders and investors grievances. The Committee is headed by Shri Ashim Kumar Mukherjee, an Independent NonExecutive Director of the Company. The Committee as on 31st March, 2013 comprises of 4 directors out of which:
q q
The Share Transfer cum Investors Grievance Committee deals with various matters such as:
q
of Annual Report/notices, dividends, etc.

q
1 is Promoter Executive Director, 1 is Promoter Non-Executive Director, and 2 are Independent NonExecutive Directors,
q
To review and note all matters relating to the registration of transfer and transmission of shares and debentures, transposition of shares, subdivision of shares, issue of duplicate share certificates or allotment letters and certificates for debentures in lieu of those lost/misplaced. To look into the redressal of shareholders and investors complaints relating to the transfer of shares, non-receipt
To oversee the performance of the Registrar & Share Transfer Agents. To review dematerialisation and rematerialisation of the shares of the Company. To comply with all such directions of SEBI, Stock Exchanges, Ministry of Corporate Affairs & other regulatory bodies w.r.t. shareholders/investors rights and market regulations, from time to time.
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During the financial year 2012-13, 4 (Four) meetings of the Share Transfer cum Investors Grievance Committee were held viz., 14th August, 2012; 9th November, 2012; 3rd January, 2013 and 12th February, 2013. The composition of the Shareholders Grievance Committee and the attendance of member Directors of the committee during the financial year 2012-13 are as follows: Name of the Members Shri Ashim Kumar Mukherjee Shri Aditya Jajodia Shri Gourav Jajodia** Shri Amit Kumar Majumdar
*Resigned w.e.f. 5th August, 2013
Designation Chairman Member Member Member
No. of meetings attended 4 4 3 4
The details of complaints received and redressed during the year under review are given below: Complaints pending as on 1st July, 2012 Complaints received during the year ended Complaints pending as on 31st 31st March, 2013 Complaints resolved during the year ended 31st March, 2013 March, 2013 : : : : NIL 1 1 NIL
All the complaints have been attended/resolved to the satisfaction of complainants during the year. No request for share transfer was pending for approval as on 31st March, 2013. Compliance Officer Shri Ajay Kumar Tantia, Company Secretary, is the Compliance Officer of the Company.
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Management (Finance) Committee The Company has a Management (Finance) Committee of Directors which as on 31st March, 2013, comprised of 4 directors out of which:
q q q
2 are Promoter Executive Directors, 1 is Promoter Non-Executive Director and 1 is Independent Non-Executive Director
Terms of reference
q q q
To assess the financial requirements of the Company. To approve and adopt the sanctions granted by the various banks and financial institutions for lending to the Company. Any other matter as referred by the Board.
During the financial period 2012-13 of 9 months, 7(Seven) meetings of the Committee were held viz., 1st July,2012, 27th September, 2012; 4th October, 2012; 10th October, 2012; 20th November, 2012; 8th March, 2013 and 28th March, 2013. The composition of the Management (Finance) Committee and the attendance of member Directors of the committee during the financial year 2012-13 are as follows: Name of the Members Shri Aditya Jajodia Shri Sanjiv Jajodia Shri Rajiv Jajodia Shri Ashim Kumar Mukherjee Designation Chairman Member Member Member No. of meetings attended 7 7 7 7
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4. GENERAL BODY MEETINGS
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Annual General Meeting The location, date and time of the last three Annual General Meetings are as follows:
Financial Year 2011-12 2010-11 2009-10
Date 18.12.2012 21.09.2011 22.09.2010
Time 11:00 A.M. 11:00 A.M. 11:00 A.M.
Location Rotary Sadan (Shripati Singhania Hall), 94/2, Chowringhee Road, Kolkata 700 020 Rotary Sadan (Shripati Singhania Hall), 94/2, Chowringhee Road, Kolkata 700 020 Rotary Sadan (Shripati Singhania Hall), 94/2, Chowringhee Road, Kolkata 700 020
Special Resolutions The following Special Resolutions were taken up in the last three Annual General Meetings and were passed with the requisite majority. 2011-12
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Approval u/s 81(1A) of the Companies Act, 1956 to create, issue, offer and allot on preferential basis to promoters group upto 1,00,00,000 warrants of ` 50/- each and given an option to holder thereof to apply for conversion of such warrants in aggregate upto 1,00,00,000 equity shares of ` 50/- each including premium of Rs. 40/- per share. Appointment of Shri Shyam Bahadur Singh as Executive Director of the Company on a remuneration not exceeding to ` 75,000/- per month w.e.f. 1st October, 2012. Re-appointment of Shri Aditya Jajodia as Managing Director of the Company for a further period of 5 years w.e.f. 23rd July, 2012 on terms, conditions and remuneration as mentined in the agreement dated 20th July, 2012.
2009-10
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Permission to increase the maximum number of directors to be appointed in the Company from 12 (twelve) to 16 (sixteen), and accordingly to amend Article 111(1) of the Articles of Association of the Company, and Approval u/s 81(1A) of the Companies Act, 1956 to create, issue, offer and allot any securities so that the total amount raised through the aforesaid securities shall not exceed US $ 100 million.
Extra-ordinary General Meeting
The details of the Extra-ordinary General Meeting (EGM) of the equity shareholders of the Company held during the last three years are as follows: Financial year 2011-12 Venue Rotary Sadan (Shripati Singhania Hall), 94/2, Chowringhee Road, Kolkata 700 020 Day and date Wednesday 09.05.2012 Time 11:00 A.M. Nature and nos. of Special Resolutions 1. Alteration in Articles of Association 2. Appointment of M/s. U. Narain & Co. and M/s. Rashmi & Co. as Joint Statutory Auditors 3. Approval for keeping the Register of members, Index of members etc., and Annual Return under Sections 159 and 160 of the Companies Act, 1956 at the office of Registrar and Share Transfer Agent as may be appointed from time to time.
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Financial year 2009-10 Venue Rotary Sadan (Shripati Singhania Hall), 94/2, Chowringhee Road, Kolkata 700 020 Day and date Monday 27.07.2009 Time 11:00 A.M. Nature and nos. of Special Resolutions 1. Issue of Equity Shares/Securities convertible into Equity Shares to eligible Qualified Institutional Buyers (QIBs). 2. Issue of Securities including FCCBs/FCCNs/GDRs/ADRs/SPNs and/or other financial instruments. 3. R e v i s i o n i n r e m u n e r a t i o n o f Shri Aditya Jajodia, Chairman & Managing Director of the Company 4. Revision in remuneration of Shri Sanjiv Jajodia, Whole-time Director of the Company
Postal Ballot No special resolutions were passed through postal ballot in the last Annual General Meeting and during the period under review. There is no proposal to pass any Special Resolution which requires passing by postal ballot in the forthcoming Annual General Meeting of the Company. 5. DISCLOSURES
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Compliance with Mandatory Requirements The Company has complied with the mandatory requirements as stipulated under Clause 49 of the Listing Agreement with the Stock Exchanges, to the extent these apply and extend to the Company.
Related Party Disclosures There are no materially significant related party transactions that have/may have potential conflict with the interest of the Company at large. However, disclosure of related party transactions is set out under Note no. 38 relating to financial statements.
Disclosure of Accounting Treatment The Company has followed the Accounting Standards notified under the Companies (Accounting Standard) Rules, 2006 issued by The Institute of Chartered Accountants of India in preparation of its financial statements. The financial statements have been audited by M/s U. Narain & Co. and M/s Rashmi & Co., Chartered Accountants, Joint Statutory Auditors of the Company and have been discussed with the Audit Committee. The Company has adequate internal control systems to identify the risk.
Listing Agreement, the Board has approved the Code of Conduct for Board members and senior management personnel and the same has been circulated and posted on the Companys website. The Board of Directors and the senior management personnel have given their declarations confirming compliance of the provisions of the above code of conduct for the year ended 31st March, 2013. The Company Secretary is responsible for adherence to the code. A declaration to this effect signed by the Chairman & Managing Director forms part of this Annual Report.
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Management Discussion and Analysis Report A Management Discussion and Analysis Report forming part of the Directors Report in accordance with Clause 49(IV)(F) of the Listing Agreement is attached herewith.
Capital Markets Disclosure The Company has complied with the requirements of Stock Exchanges, SEBI and other statutory authorities on matters relating to the capital markets during the last three years and consequently no penalties or structure have been imposed on the Company by these authorities.
6. SECRETARIAL AUDIT A qualified practising Company Secretary carried out secretarial audit to reconcile the total admitted
Code of Conduct In pursuance to Clause 49 of the
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capital with National Securities Depository Limited (NSDL) and Central Depository Services (India) Limited (CDSL) and the total issued and listed capital. The audit confirms that the total issued/paidup capital is in agreement with the total number of shares in physical form and the total number of dematerialised shares held in electronic mode with NSDL and CDSL. 7. SUBSIDIARY COMPANIES The Company has three wholly owned subsidiaries viz., (a) M/s Nilachal Iron & Power Limited (b) M/s Jai Balaji Steels (Purulia) Limited (c) M/s Jai Balaji Energy (Purulia) Limited Shri Ashim Kumar Mukherjee, an independent director on the Board of the Company is also a director on the Board of M/s Nilachal Iron & Power Limited. The Company monitors the performance of such companies, interalia, by the following means: a) Copy of the Minutes of the Meetings of the Board of Directors of the Subsidiary Companies are tabled before the Companys Board. b) F i n a n c i a l r e s u l t s o f t h e Subsidiary Companies are tabled before the Companys Audit Committee and Board. 8. CEO AND CFO CERTIFICATION Shri Aditya Jajodia, Chairman & Managing Director and CEO, and Shri Raj Kumar Sharma, CFO of the Company have certified to the Board in accordance with Clause 49(V) of the Listing Agreement pertaining to the CEO and CFO certificate for the nine months financial year ended 31st March, 2013 which is separately enclosed with this report. 9. MEANS OF COMMUNICATION Quarterly Financial Results In compliance with Clause 41 of the Listing Agreement, the Company regularly intimates the un-audited as well as audited financial results to the stock exchanges as soon as the same are approved and taken on record by the Board and the same is filed through NSE Electronic Application Processing System and BSE Corporate Compliance & Listing Centre. The Annual Report, Quarterly/half yearly results, Shareholding Patterns etc. of the Company are also posted on the website of the Company i.e. www.jaibalajigroup.com Newspapers wherein results normally published The un-audited and, or audited results of the Company are published in Business Standard and Mint (English Newspaper), Aajkal and Sakalbela (Vernacular Newspaper) Website In compliance of Clause 54 of the Listing Agreement and SEBI Circular No. CIR/CFD/DIL/10/2010 dated December 16, 2010, the Company is maintaining a functional website i.e. www.jaibalajigroup.com containing the basic required information about the Company. Contact information of the designated official responsible for Assisting and Handling Investor Grievances is: The Company Secretary Jai Balaji Industries Limited 5, Bentinck Street, Kolkata - 700 001 Phone No.: (91)(33) 32607848 E-mail:cs@jaibalajigroup.com News Releases, Presentations etc. The official news releases and presentations, if any, made to institutional investors and analysts at investors meet from time to time are also posted on the Companys website. Official Press Releases are sent to the Stock Exchanges. Exclusive e-mail-id for Investors Grievances As per Clause 47(f) of Listing Agreement and SEBI Circular No. MRD/ DoP/ SE/DEP/CIR-22/06, the Company has created an exclusive e-mail ID for redressal of investors grievances, i.e. jaibalaji@jaibalajigroup. com
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10. SHAREHOLDER INFORMATION
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Annual General Meeting : Day, date, time and venue
: :
Thursday, 12th September, 2013 at 11.00 a.m. Rotary Sadan (Shripati Singhania Hall), 94/2, Chowringhee Road, Kolkata 700 020 April 2013 to March 2014 The probable dates for the publication of the Financial Results for the financial year 2013-14: 1st Quarter Results 2nd Quarter Results 3rd Quarter Results Annual Results On 5th August, 2013 On or before 14th Nov, 2013 On or before 14th Feb, 2014 On or before 30th May, 2014
Financial calendar (tentative) for the year 2013-14
Date of book closure
Saturday, 7th September, 2013 to Thursday, 12th September, 2013 (both days inclusive) N.A. National Stock Exchange of India Ltd. EXCHANGE PLAZA, Bandra-Kurla Complex, Bandra (E), Mumbai 400 051 BSE Ltd. 25 P. J. Towers, Dalal Street Mumbai 400 001 The Calcutta Stock Exchange Ltd. 7, Lyons Range, Kolkata 700 001
Date of Dividend payment Listing of equity shares on stock exchanges
: :
The Company has paid annual listing fees to each of the above Stock Exchanges for the financial year 2013-14.
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Stock Code/Symbol
NSE JAIBALAJI BSE 532976 CSE 10020253 National Securities Depository Limited Trade world, 4th Floor, A Wing Kamala Mills Compound Senapati Bapat Marg, Lower Parel Mumbai - 400 013 Central Depository Services (India) Limited Phiroze Jeejeebhoy Towers, 17th Floor, Dalal Street Mumbai - 400 001
Depositories
Demat ISIN Number in the NSDL and CDSL - For fully paid-up equity shares - For partly paid-up equity shares Corporate Identification Number (CIN)
: : :
INE 091G01018 IN 9091G01016 L27102WB1999PLC089755
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Market price data The Companys monthly high and low prices recorded on the National Stock Exchange of India Limited & BSE Limited during each month in last financial year 2012-13 (July 2012 to March 2013) are as under: Month Share Price (NSE) High (`) July 12 August 12 September 12 October 12 November 12 December 12 January 13 February 13 March 13 39.95 44.40 38.00 42.30 37.40 38.30 40.00 34.00 34.90 Low (`) 32.50 34.50 33.00 32.50 32.00 33.60 31.00 26.90 26.00 Share Price (BSE) High (`) 38.90 43.00 38.40 44.20 36.85 37.90 39.50 33.45 32.10 Low (`) 32.05 35.00 33.05 32.35 32.00 33.80 31.00 27.00 24.50
Share price performance in comparison to broad based indices - NSE Nifty and BSE Sensex
Registrars and Share Transfer Agent
Registrar and Share Transfer Agent M/s. Maheshwari Datamatics Pvt. Ltd. 6, Mangoe Lane, 2nd Floor Kolkata - 700 001 Phone No.: (91) (33) 2243 5029/5809 E-mail: mdpldc@yahoo.com 99.98% of the equity shares of the Company are in electronic mode. Transfer of these shares is done through the depositories. As regards transfer of shares held in physical form the transfer documents can be lodged with the Registrar & Share Transfer Agent at the above mentioned address. The transfers are normally processed within 15 days from the date of receipt, if the documents are complete in all respects.
Share transfer system
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11. CATEGORIES OF SHAREHOLDERS AS ON 31ST March, 2013 Category Resident individual Non-Resident individual Domestic Companies Foreign Companies Foreign Institutional Investors Trust Directors and their Relative Promoter Bodies Corporate Clearing Member Total Number of Shareholders 9,775 125 441 3 10 1 11 6 19 10,391 Shareholders % 94.07 1.20 4.24 0.03 0.10 0.01 0.11 0.06 0.18 100.00 Number of ordinary shares held 7,629,344 458,039 11,591,552 8,304,547 2,567,258 1 9,929,672 23,290,723 10,350 63,781,486 Holding % 11.96 0.72 18.17 13.02 4.03 0.00 15.57 36.52 0.02 100.00
12. DISTRIBUTION OF SHAREHOLDING AS ON 31ST MARCH, 2013 Range of ordinary shares held Up 501 1001 2001 3001 4001 5001 10001 50001 100001 Total 13. DEMATERIALISATION OF SHARES AND LIQUIDITY AS ON 31ST MARCH, 2013 The Companys shares are compulsorily traded in dematerialised form and are available for trading on both the depositories in India the National Securities Depository Limited (NSDL) and Central Depository Services (India) Limited (CDSL). As at 31st March, 2013 a total of 63,765,950 equity shares of the Company, representing 99.98% of the Companys share capital were held in dematerialised form of which 58,760,125 equity shares were held with the to to to to to to to to to and 500 1000 2000 3000 4000 5000 10000 50000 100000 above No. of Shareholders 8,953 604 327 118 59 58 108 94 20 50 10,391 Percentage (%) to total shareholders 86.16 5.81 3.15 1.14 0.57 0.56 1.04 0.90 0.19 0.48 100.00 No. of Shares 1,037,122 483,551 496,026 300,504 209,607 269,810 796,693 1,966,500 1,444,434 56,777,239 63,781,486 Percentage(%) to Share Capital 1.63 0.76 0.78 0.47 0.33 0.42 1.25 3.08 2.26 89.02 100.00
National Securities Depository Limited (NSDL) and 5,005,825 equity shares with Central Depository Services (India) Limited (CDSL). The Companys shares are regularly traded on the National Stock Exchange of India Limited and BSE Limited. As per agreements of the Company with the NSDL and CDSL, the investors have an option to dematerialise their ordinary shares with either of the depositories. Under the depository system, the International Securities Identification Number (ISIN) allotted to the Companys shares for fully paid-up
shares is INE 091G01018 and for partly paid-up shares it is IN 9091G01016.
100.00% 80.00% 60.00% 40.00% 20.00% 0.00% NSDL Series 1 CDSL Physical 0.02% 7.85% 92.13%
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14. OUTSTANDING GDRs/ADRs/WARRANTS OR ANY CONVERTIBLE INSTRUMENTS, CONVERSION DATE AND LIKELY IMPACT ON EQUITY During the year under reporting, no GDRs/ADRs/Warrants or any Convertible Instruments were issued. However, the Company has issued and allotted on 4th July, 2013, 10,000,000 warrants to promoter group companies namely M/s. Enfield Suppliers Limited (19,00,000 warrants) and M/s. Hari Management Limited (8,100,000 warrants) on a private placement basis at an issue price of ` 50/- each. Each warrant is convertible into one equity share within a period of 18 months from the date of allotment, in one or more tranches, at a conversion price of ` 50/- per equity share (including a premium of ` 40/- per share), which is a price greater than the price determined as per Regulation 76 of Chapter VII of SEBI (ICDR) Regulations, 2009. The Board at its meeting held on 5th August, 2013, has fully and partly converted the said warrants, by way of allotment of 34,95,000 equity shares, being 1,900,000 equity shares to M/s. Enfield Suppliers Limited and 15,95,000 equity shares to M/s. Hari Management Limited, pursuant to their resective application for conversion of warrants. After the said conversion, the equity share capital of your compay stands at `672,764,860/- divided into ` 67,276,486 equity shares of ` 10/- each. After the conversion of remaining warrants, if exercised, the equity capital of the Company will icrease to ` 737,814,860/- from the existing ` 672,764,860/-. The shares so issued shall rank pari-passu in all respects, including as to dividend, with the existing shares of the Company. 15. DETAILS OF UNCLAIMED SHARES The company has 847 unclaimed shares of 10 shareholders in a Demat Account titled Jai Balaji Industries LimitedUnclaimed Shares Demat Suspense Account opened by the Company in line with the Circular no. SEBI/CFD/DIL/LA/1/2009/24/04 dated 24 th April, 2009 issued by the SEBI which could not be credited to shareholders demat account for insufficient/incomplete/improper details furnished by them. The said shares had arisen out of the allotment made at the time of Initial Public Issue of erstwhile M/s. Shri Ramrupai Balaji Steels Limited (since amalgamated with the Company). The allottees account shall be credited as and when he/she approaches the issuer, after undertaking the proper verification of identity of the allottee. The voting rights of these shares shall remain frozen till the rightful owner claims the shares. Details of Unclaimed shares are as follows: Particulars Aggregate number of shareholders and the outstanding shares in the suspense account lying as at 1st July, 2012 Number of shareholders who approached issuer for transfer of shares from suspense account during the year Number of shareholders to whom shares were transferred from suspense account during the year Aggregate number of shareholders and the outstanding shares in the suspense account lying as at 31st March, 2013 Number of Shareholders 10 Nil Nil 10 Aggregate Number of Shares 847 Nil Nil 847
16. PLEDGE OF EQUITY SHARES As per declarations received, the under mentioned promoters/promoter group of the Company have pledged the Equity Shares of the Company held by them. Sl. No. Name of Promoter/ Promoter Group No. of Equity Shares pledged as on 30.03.2013 3,075,000 2,640,000 1,550,000 323,000 11,221,233 7,044,000 2,519,000 2,410,000 30,782,233 % to total holding of respective promoter in the Company 83.68% 99.64% 98.83% 40.66% 100.00% 99.99% 99.82% 99.99% -% to aggregate no. of Equity shares held by all the promoters in the Company 9.26% 7.95% 4.67% 0.97% 33.78% 21.20% 7.58% 7.25% 92.66% % to total no. of Equity Shares the Company 4.82% 4.14% 2.43% 0.51% 17.59% 11.04% 3.95% 3.78% 48.26%
1 2 3 4 5 6 7 8
Shri Aditya Jajodia Shri Sanjiv Jajodia Shri Rajiv Jajodia Shri Aashish Jajodia M/s. Enfield Suppliers Limited M/s. Hari Management Limited M/s. Jai Salasar Balaji Industries Pvt. Ltd. M/s. K. D Jajodia Steels Industries Pvt. Ltd. Total
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17. PLANT LOCATIONS Unit I Ranigunj G/1, Mangalpur Industrial Complex, Post : Baktarnagar Dist. : Burdwan West Bengal - 713 321 Unit III & IV Durgapur, Vill: Banskopa, P.O. : Rajbandh Dist.: Burdwan West Bengal 713 212 Unit II Durgapur, Lenin Sarani, Dist.: Burdwan West Bengal - 713 210
Unit V Industrial Growth Centre, Borai Village & P.O. : Rasmada, Dist. Durg : 491 009 Chhattisgarh
18. ADDRESS FOR CORRESPONDENCE
The Company Secretary Jai Balaji Industries Limited 5, Bentinck Street Kolkata 700 001, India Tel: (91)(33) 2248 8173 / 9808 Fax: (91)(33) 2243 0021 E-mail: info@jaibalajigroup.com Website: www.jaibalajigroup.com
19. ADOPTION OF NON MANDATORY REQUIREMENTS

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but no personnel are denied access to the Audit Committee.

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Remuneration Committee The details pertaining to the Remuneration Committee have been provided in item no. 3 of this Report.
Others The other non-mandatory requirements such as training of Board members, mechanism for evaluating the NonExecutive Board Members and the whistleblower policy will be implemented by the Company, as and when required and/or deemed necessary by the Board. The company is yet to implement tenure of Independent Directors of not exceeding in the aggregate, a period of nine years. However at present tenure of no such independent director exceeds in aggregate a period of nine years. The Company has ensured that the person who is being appointed as an independent director has the requisite qualifications and experience which would be of use to the Company and which,
in the opinion of the Company, would enable him to contribute effectively to the Company in his capacity as an independent director. Auditors Certificate on Corporate Governance The Company has received a certificate, annexed to the Directors Report, from the Statutory Auditors of the Company testifying to its compliances with the provisions relating to Corporate Governance as stipulated in Clause 49 of the Listing Agreement executed with the Stock Exchanges.
Management (Finance) Committee The details pertaining to the Management (Finance) Committee have been provided in item no. 3 of this Report.
Shareholder rights Half-yearly financial results including summary of the significant events are currently not being sent to each household of shareholders. However, these are posted on the Companys website at. www.jaibalajigroup.com
For and on behalf of the Board Aditya Jajodia Chairman & Managing Director
Whistleblower policy The Company does not have any whistleblower policy as of now,
Place : Kolkata Date : 12th August, 2013
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DECLARATION
As provided under Clause 49 of the Listing Agreement with the Stock Exchanges, this is to confirm that all the members of the Board and Senior Management have affirmed compliance with the Code of Conduct for the nine months financial year ended 31st March, 2013. The said Code of Conduct is posted on the website of the Company, namely, www.jaibalajigroup.com.
Aditya Jajodia Chairman & Managing Director
Auditors Certificate on Compliance with the conditions of Corporate Governance under Clause 49 of the Listing Agreement
To The Members of Jai Balaji Industries Limited We have examined the compliance of conditions of corporate governance by Jai Balaji Industries Limited, for the nine months financial year ended 31st March, 2013, as stipulated in Clause 49 of the Listing Agreement of the said Company with Stock Exchange(s). The compliance of conditions of corporate governance is the responsibility of the management. Our examination was limited to procedures and implementation thereof, adopted by the Company for ensuring the compliance of the conditions of the Corporate Governance. 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 according to the explanations given to us, we certify that the Company has complied with the conditions of Corporate Governance as stipulated in the above mentioned Listing Agreement. 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.
For U Narain & Co. Firm Regn. No. 000935C Chartered Accountants CA R. R. Modi Partner Membership No. : 053118
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Certification by Chief Executive Officer and Chief Financial Officer

We, Aditya Jajodia, Chairman & Managing Director and Raj Kumar Sharma, Chief Financial Officer of Jai Balaji Industries Limited, to the best of our knowledge and belief, certify that: 1. 2. 3. We have reviewed the Financial Statements and all its notes on accounts as well as the Cash Flow Statements, for the nine months financial year ended 31st March, 2013; Based on our knowledge and information, these statements do not contain any materially untrue statement or omit to state a material fact or contain any statement that might be misleading with respect to the financial statements; Based on our knowledge and information, the financial statements, and other financial information included in this report present, in all material respects, a true and fair view of the Companys affairs, its financial condition, results of operations and cash flows of the Company as of, and for the period presented on this report, and are in compliance with the existing accounting standards and/or applicable laws and regulation; To the best of our knowledge and belief, no transaction entered into by the Company during the year are fraudulent, illegal or violative of the Companys Code of Conduct; That we accept responsibility for establishing and maintaining internal controls. We have evaluated the effectiveness of the internal control systems of the Company and we have disclosed to the auditors and the Audit Committee, deficiencies in the design or operation of the internal controls, if any, of which we are aware and the step that we have taken or propose to take to rectify the identified deficiencies and; That we have informed the auditors and the audit committee of: i) significant changes in the internal control over financial reporting during the year;
4. 5.
6.
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 we have become aware and the involvements therein, if any, of the management or an employee having a significant role in the Companys internal control system.
Place : Kolkata Date : 15th May, 2013
Aditya Jajodia Chairman & Managing Director
Raj Kumar Sharma Chief Financial Officer
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Management Discussion and Analysis

The Companys core business is manufacturing and marketing of Iron and Steel products. The Management discussions and analysis is given hereunder:Industry Structure & Development Global Overview The global economy appears to be transitioning toward a period of more stable but slower growth. The economic conditions improved modestly in the third quarter of 2012 aided by global growth increasing to about 3%. The economy improved marginally, driven mainly by emerging market economies, where activity picked up broadly as expected. Further global financial conditions improved in the fourth quarter of 2012. However, a broad set of indicators for global industrial production and trade suggests that global growth did not strengthen further. Uptick in global growth in the third quarter was partly due to temporary factors, including increased inventory accumulation. A sharp pullback in demand of steel in the third quarter has pushed up steel consumption in the fourth quarter. The situation remained grim for the steel industry. However, the gobal steel demand is expected to grow over by 10% in the next five years. World Crude Steel production reached 1,548 MT for the year 2012, up by 1.2% compared to 2011. Economy Outlook Global economic outlook weakened both in developed and developing countries. In 2012-13, the industrial sector was plagued by a slowdown in demand and consumption, driven by policy slowdown. World crude steel production for the 62 countries reporting to the World Steel Association was 132 MT in April 2013, an increase of 1.2% compared to April, 2012 and accounted for more than 98% of world crude steel production. The average capacity utilization ratio in 2012 was 78.8% compared to 80.7% in 2011. World Steel Association expects the next 2 years to see a much better performance by projecting global demand for steel to increase by 2.9% in 2013 to 1,454 MT bettering the 1.2% growth seen in 2012 and then improve further in 2014 with a 3.2% and will reach 1,500 MT. Rank Country the April 2013. In developing and emerging economies the growth slowed down more than expected majorly due to global overcapacity and low demand. Indian Economy With the steady decline in the domestic economys growth rate, the Indian steel industrys pace of growth slowed down 2011 (MT) Percentage (%) increase or (decrease) 3.1 (0.3) 2.5 4.3 2.5 1.2 (3.7) 5.2 (1.5) (6.9)
2012 (MT)
1 2 3 4 5 6 7 8 9 10
China Japan United States India Russia South Korea Germany Turkey Brazil Ukraine
716.50 107.20 88.60 76.70 70.60 69.30 42.70 35.90 34.70 32.90
694.80 107.60 86.40 73.60 68.90 68.50 44.30 34.10 35.20 35.30
Source: World Steel Associatin The crude steel capacity utilization ratio of the 62 countries in April, 2013 declined by 2.0% compared to April, 2012. Steel production rose despite an overall annual decline in the countries of European Union and in South America. Chinas share of world crude steel production was 65.7 MT, up by 6.8% compared to April, 2012. The European economy recorded a decrease of 4.7% compared to 2011, producing 169.4 MT of crude steel in 2012. Steel makers in Asia and North America drove much of the 2012 growth. India remained the fourth largest crude steel producer thereby producing 77.6 MT during 2012 and a bright spot in the global steel industry. According to IMF growth in global economy was more slow than expected, with risks increasing especially in emerging markets. Global growth is now projected at 3.1 for 2013 and 3.8 percent for 2014, a downward revision of percentage point compared with and in terms of all the performance indicators viz., capacity creation, production, consumption, exports and price/ profitability, the performance of the industry fell below average. In foreign trade, Indian steel was also subjected to anti-dumping/safeguard duties as most developed economies invoked non-tariff barriers. Economic devastation caused by the Asian financial crisis, slowdown of the global economy and the impact of glut created by additional supplies from the newly steel-active countries (the steel-surplus economies of erstwhile USSR) were the factors that pulled down growth levels. The Iron and Steel Industry contributes around 3 per cent of the Gross Domestic Product (GDP) and Indias GDP grew at 5% during 2012. Overall, Indias GDP is expected to climb to 6-6.5% in 201314 due to a consumption revival. The growth in Indian economy slowed for the second year in succession to 5 % in 2012-13 against modest growth of 6.2%
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Management Discussion and Analysis (contd.)

in 2011-12. Neverthless, it is unlikely that the support to Indian growth from the global economy will be significant. Managing growth and price stability are the major challenges of macroeconomic policymaking. In 201213, India found itself in the heart of these conflicting demands. However, the boost to consumption, coupled with supplyside constraints, led to higher inflation. Monetary policy was tightened, even as external headwinds to growth increased. The consequent slowdown in 2012-13, has been across the board, with no sector of the economy unaffected. Falling savings without a commensurate fall in aggregate investment have led to a widening current account deficit. Steel prices are higher in India than global prices. As such, the Indian economy has slowed sharply due to a string of factors, including q euro zone crises q geopolitical disturbances q weather extremities q high inflation q high interest rates q slowing global economy q delay in implementation of projects
q q q
policy logjam slowing industrial growth and declining business environment
However, the continued closure of older, higher-cost steelmaking capacity and increased demand should lead to improved profitability for the sector in 2014 and 2015, driven by better utilization rates. Global Steel Industry Overall the global steel industry witnessed steady growth during the year. Despite, increase in World Crude Steel output by 1.2% in 2012-13 as compared to 2011-12. The growth came mainly from Asia and North America while crude steel production in the EU and South America decreased in 2012. The crude steel production in India has reached approximately 100 million tonnes. There is significant overcapacity in the global steel sector which is putting pressure on operators profitability and demand-supply imbalances. China, India and other emerging markets continued to drive demand but demand levels remained lower. Looking ahead, global steel industry is likely to remain positive, but with lower growth.
Yearly World Crude Steel production (million tonne)
World Crude Steel Production

Year
2012 2011 2010 2009 2008 2007 2006 2005 2004 2003 0 500 1000 1500 2000 2500 3000 3500 4000
Million tonnes
Source: World Steel Association
Share of World Crude Steel Production 2011, 2012 Country Wise
2011
China South Korea India Japan United States Brazil European Union (27) Ukraine Russia Others 2% 6% 7% 5% 4% 5% 2% 12% 12% China South Korea India Japan United States 45% Brazil European Union (27) Ukraine Russia Others
2012
12% 5% 2% 11%
46%
2% 6% 7% 5% 4%
Source: World Steel Association
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Steel capacity utilisation Despite the global rise in tonnage, total capacity utilization was down. Unfavourable domestic and external economic conditions are set to pull down Indias steel consumption in the current calendar year due to a steep decline in manufacturing and construction activities. World economic slowdown had its effect of Steel sector making it vulnerable to production cuts and capacity outages. Emerging economies such as China and India were on the lowest side with high capacity utilization during the year. All the major steel producing countries registered a positive growth in production. The crude steel capacity utilisation ratio for the 62 countries in January, 2013 declined to 71.2% from 73.2% in December, 2012 which is 5.5% lower. Challenges of Steel Industry Steel industry is continuously faced hard times. Understanding the challenges of Steel market is important in order to explore new opportunities of growth. During the year 2012-13, Indian Steel Industry faced a downstream due to a number of domestic factors, apart from problems faced by it globally. Dollar has push the costs thereby weakening the rupee. Slowdown in mining activities has affected future capacity expansion. Illegal mining, delay in environmental clearance and other issue have also affected the price and availability of iron ore. This has created numerous challenges for steel makers as they must now deal with volatility in raw material prices, as well as maintain margins with fluctuating demands. The Government support is required for continued delays in project approvals.
q q
oversupply and weak demand. However, the overall production growth picked up some pace of 3.3% in the period April-December 2012.
q
change their business models by introducing greater operational flexibility and becoming more customerfocused in how they price their product. The iron and steel industry is highly fragmented. A combination of factors such as growth in related complimentary industries and government regulations, cyclical fluctuations in input prices, general economic conditions, and end use markets are witnessed to impact the industry dynamics significantly. The global iron and steel demand is expected to pick up slightly to 3.2% in 2013. Global industrial activity has weakened, and confidence has fallen on account of financial turbulence in the euro zone, weak private demand in the United States, and events in Japan and Middle East. Growth in emerging market and developing economies is on track to build 5.5% in 2013. Emerging markets are also affected by the current economic slowdown, particularly when reliant on export income from developed markets. Inflation is an issue in many emerging markets, and governments are lifting the interest rates. Global steel production is expected to grow at a CAGR of 2.6 percent by 2015. Steel demand may vary depending on the outlook for different regions and countries. Indian Steel Industry Steel is a major raw material to the Indian development and steel industry is a booming industry in the whole world. Steel industry is vital for overall economic development of every nation as it is one of the core sectors. India is the largest producer of sponge iron in the world. Despite all the headwinds and lingering difficulties steel industry has delivered robust growth. With the introduction of new reforms, India though welcomed world steel majors; however their projects after hitting several road blockades are yet to generate output. The steel sector
Rupee Depreciation, Mixed ImpactDepreciation in rupee pressurised the margins of companies to remain similar in 2012 levels. This is due to the persistent high cost of steel production and steel producers limited ability to pass on higher costs due to subdued demand form end user. Moreover, a weaker rupee raised the financial leverage of steel producers.
StabilizationStabilization in the economic situation, driven by continued albeit slow growth in steel demand, the economic prospects remained weak and reflected inherent risks in the steel sector. Operational agility The very nature of steel making and large amounts of capital investments means that the sector does not find it easy to adjust quickly to changing circumstance. Steel mills, operating at high capacity, may not be able of reduce production with a corresponding sudden decrease in demand. This causes a oversupply of steel in the market. There remains a lag between demand fluctuation and production adjustments as there is still structural overcapacity in certain product segments.
A need for business models to evolve For many decades, the steel mills held both purchasing power over the raw materials supplies and set market prices for steel distributors and customers. In recent years, however, most of the pricing power switched to the suppliers and customers. In response to these changes, steelmakers need to
Lacklustre demandPersistent slowdown in demand for steel and falling steel prices has squeezed profitability. Additionally, global nature of the steel market is affected by
34


contributes to nearly 2 percent in the GDP and employs over 5 lakh people. Indian Steel industry is poised for greater growth catapulating India to the league of highest steel consuming nations of the world in the next decade. India ranked as the fourth largest producer of crude steel in the world during the year after China, Japan, and the USA and also made a mark globally in the production of sponge iron/direct reduced iron (DRI). Crude steel production grew at a CAGR of 7.7 per cent during the last five years ending 2011-12. With growth in production for sale lagging behind real consumption growth, India has turned into a net importer of finished steel since 2007-08 with rise in imports. Exports, on the other hand, have declined to ensure greater domestic availability during this period. The increase in production is driven by 8.8 per cent growth in crude steel capacity mainly in the private-sector plants and
(million tonne)
Steel Outlook The Indian economys outlook for 2013-14 can be viewed as cautiously optimistic. Backed by policy actions announced in the recent budget, it is projected that India would return to the robust growth path of 7-8% over the next two to three years. Considering the forecasted growth in the economy and the prospects of the steel industry it is expected that the domestic demand for steel may increase marginally. The Steel Industry despite bearing burnt of global slowdown and variation in demand and supply has grown at sound pace th India has reached 4 rank among the steel producing nations. Steel demand was low in 2013 due to continuing economic crisis, however, spurt in demand is expected in 2014-15. India Steel production has grown strongly in the recent decades and is likely to continue to expand to meet anticipated demand. World Steel Association expects steel demand to pick up and grow by 5.9% to 75.8 MT in 2013 following 2.5% growth in 2012 as monetary easing is expected support investment activities. In 2014, growth in steel demand is expected to further accelerate to 7.0% due to reform measures aimed at narrowing the fiscal deficit. The steel production in India is likely to grow at a CAGR of 8.8% during 2012-13 as indicated by the Government and external research. The Government of India has framed the National Steel Policy to encourage the Steel industry to reach global benchmarks in terms of quality, cost and efficiency. Besides this, Governments decision of increasing duty on the iron ore exports has charged up the domestic steel companies, as export of this raw material had heated up its cost. Achievement of self sufficiency in iron ore production has also boosted the morale of companies who are now looking forward for inventing technologically upgraded steel plant which can deliver similar output with
Production, Consumption and Growth of Steel

Total finished steel (alloy + non alloy) Year 2007-08 2008-09 2009-10 2010-11 2011-12 2012-13 (Apr, 12 - Dec, 12) Production for sale 56.08 57.16 60.62 68.62 73.42 56.72 Import 7.03 5.84 7.38 6.66 6.83 5.79 Export 5.08 4.44 3.25 3.64 4.04 3.78
Real consumption 52.13 52.35 59.34 66.42 70.92 53.53
Source: Ministry of Steel. The targeted steel production in India by 2019-2020 is over 276 MTPA. Growth in net exports has been negative due to the weakening of global demand. The production has been increasing at a moderate rate since 2006-07, while exports of finished steel during the year were low due to low demand of steel in euro zone. Crude Steel Production and Capacity Utilisation high utilization rates during this period according to the Economic Survey of India. Steel Consumption: Indias steel industry had a dismal 2012, consumption of steel in India grew at a modest 3.3% in financial year 2012 against 6.9% in financial year 2011 due to the slowdown in the end user industries. The consumption of steel has seen a constant increase due to rise in demand from sectors like agriculture, oil & gas, capital goods. Indias consumption of steel is expected to reach 122mt by 2015, which is almost double from the current production level. According to the World Steel Association, the consumption is expected to increase by 5.4% and such increase shall majorly be driven by China and India. The consumption of finished steel has grown at a CAGR of 9.6% during the last six years as per the Ministry of Steel.
Capacity (000 tonnes) Production (000 tonnes)
100.00 90.00 80.00 70.00 60.00 50.00 40.00 30.00 20.00 10.00 2007-08 2008-09 2009-10 2010-11 2011-12 2012-13
(Apr-Dec)
Source: Ministry of Steel
35


usage of iron fines and non-coking coal, which is widely available. The Country is expected to be the second largest steel maker in the world from its current fourth position followed by Brazil as the third ranked country. The major drivers such as pick up in agriculture, normal monsoon, lower interest rates, higher government spending and increase in consumption are expected to shape Indias growth prospects in 2013-14. Domestic steel demand is expected to be muted in 2013-14 and profit margins in financial year 2013-14 to remain broadly similar to the financial year 2013-14. This is mainly due to persistent high cost of steel production. The World Steel Association has forecasted steel demand in India to grow at 5.9% and 7% in 2013-14 and 2014-15, respectively. Opportunities, Threats, Risks and Concern Opportunities Indian Steel industry is on the growth path by growing domestic demand, unexplored rural market and rapid urbanisation. The strong growth in automotive industry and power sectors would drive steel output and consumption. Indian Steel producer looking for overseas acquisitions in steel as well as raw material and also increasing interest of foreign steel producers in India. With the improvement in the economic recessions in the west, the potential for growing demand is high. The optimistic employment scenario and rising income levels and continuity of the developmental projects around the world would strengthen economy growth. Indian steel industry has diversified its product mix to include sophisticated value-added steel used in the automobile sector, heavy machinery and physical infrastructure. Massive infrastructure needs and expansion of industrial production will give boost to the demand in the steel sector. Steady and sustained fiscal condition and financial sector reforms will support reducing downside risks. Threats, Risks and Concern The slowdown in economic growth is taking its toll on industrial output and availability of timely and reasonable raw material is another concern for the industry. The cyclical nature of steel demand, arising from volatility in prices of raw material, excess capacity, regional demand and supply imbalance, etc. has affected the steel demand. Indian Steel industry may get affected if the demand in advance countries does not increase. The revival of growth in the advanced economies is expected to be slow and uncertain at least in the near future, despite the measures being taken on monetary and fiscal fronts. Global overcapacity and demand slowdown and anti-dumping duties on exports worsened the domestic demand-supply imbalances. Indian Steel Industrys margins are affected adversely due to weak global growth, limited availability of finance and high raw material prices. During the financial year 2012-13, volatile raw material prices have only reinforced the validity of the strategic objective to achieve greater raw material security to insulate the Group from swings in prices and the resultant impact on profitability. Keeping the Group updated with frequently changing technological advancements is one of the important challenges.The industry by nature is capital intensive and requires high capital, by various modes, increasing cost of borrowing remains one of the major concerns for the group and industry as a whole. Performance Analysis During the year 2012-13, your company incurred loss which can be mainly attributable to raw material price inflation, rising borrowing costs and other global factors. The Loss before exceptional and extraordinary items and tax was ` 31,597.71 lacs as compared to loss of ` 38,884.08 lacs in the previous year. The net loss for the year under review (nine months) was ` 21,312.78 lacs againt loss after tax of ` 27,605.62 lacs in the previous year (fifteen months). Debt Re-structuring The Corporate Debt Restructuring scheme, approved by CDR Empowered Group/CDR Cell, vide letter of approval dated 20 th September, 2012 has been implemented during the year. Internal Audit & Control The Company has set up internal control systems commensurate with its size and nature of operations. This system ensures reasonable assurance of recording the transactions of its operations in all material respects and of providing protection against significant misuse or loss of Company assets. The Company has a well defined internal audit which is empowered to examine the adequacy and compliance with policies, plans and statutory requirements. Periodic audits are conducted in various disciplines to ensure adherence to the same. The Internal audit is conducted in line with the size of operations and operations and is designed to review the adequacy of internal control checks in the system and covers all significant areas of the Companys operation. The Company has an external and independent firm to carry out the internal audit of the Companys activities. The direct reporting of the Internal Auditors to the Audit Committee of the Board ensures independence of the audit and compliance functions. The internal auditors periodically interact with the Audit Committee to discuss the frequency of the audit, significant audit observations and their disposals and remedies, if any. Emphasis is placed on adequacy, reliability and accuracy
36


of dissemination of financial data and information. Human Resource The Company believes that the key to its success lies in creating and nourishing a pool of talent within its people whose skills, expertise and experience provide the essential impetus towards market leadership. A mix of youth and experience, the vision and leadership of a stable senior management is matched by of the youth brigade. The Company periodically review the current organizational design and evaluate opportunities for changes that will promote the implementation of the business strategy. The Company also clearly defines, communicate, and apply in strengthening the knowledge, skills, attitudes, and performance levels required for progression. As the Company is growing, more and more emphasis is given to the recruitment process and your Company has been successful in attracting best professional talent. The Company recognized the fact that manpower is its biggest strength and their proper nurturing is necessary for the success of the organisation. Therefore, there is no greater joy for the company than to cherish and appreciate 2,900 persons which comprises professionals from diverse backgrounds like engineering, finance, taxation, law, management, business, supervisors, operators and sub-staff at the threshold of the opportunities that lie ahead. The Company acknowledges the employees contribution towards leading, thinking, working, creating, processing and dealing to enhanced growth. The management strengthens human resource by making available better tools, technology, techniques at the work place to harness the talent potential. Employees health and safety measures are in force at work places, manufacturing areas, etc. A good record of participative management reflects the healthy culture of Jaibalaji. The Company believes that a fair working system, based on the interaction of the employees with the organization through his role, is a key motivator. A happy individual always performs well. If the employee finds his work challenging, efforts worthwhile, and rewards commensurate, he is likely to give his best for mutual benefit and prosperity. Cautionary Statement Statements in the Management Discussion and Analysis Report describing the Companys objectives, projections, estimates and/or expectations may be forwardlooking statements within the meaning of applicable laws and regulations. Actual results could differ materially from those expressed or implied. Significant factors that could make a difference to the Companys operations include, among others, domestic and international economic conditions affecting demand/supply and price conditions, changes in the government regulations, tax regimes and other statutes and other incidental factor.
37

Independent Auditors Report

To the Members of Jai Balaji Industries Limited Report on the Financial Statements We have audited the accompanying financial statements of Jai Balaji Industries Limited (the Company), which comprise the Balance Sheet as at March 31, 2013, and the Statement of Profit and Loss for the period 1st July, 2012 to 31st March, 2013 and Cash Flow Statement for the period then ended, and a summary of significant accounting policies and other explanatory information. Managements Responsibility for the Financial Statements Management is responsible for the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the Accounting Principles generally accepted in India including Accounting Standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956 (the Act). This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error. Auditors Responsibility Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with the Standards on Auditing issued by the Institute of Chartered Accountants of India. Those Standards require that we comply with For U. Narain & Co. Chartered Accountants Firm Regn. No. 000935C CA R. R. Modi Partner Membership No. : 053118 27, Brabourne Road, Narayani Building 5th Floor, Room No.503 Phone: 033 3053 3386 (5 lines) Email: unaraincokol@gmail.com Dated: 15th May, 2013
ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditors judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the Companys preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion. Opinion In our opinion and to the best of our information and according to the explanations given to us, the aforesaid financial statements give the information required by the Act 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 the Balance Sheet, of the state of affairs of the Company as at March 31, 2013; In the case of the Statement of Profit and Loss, of the loss for the period ended on that date.
b)
In the case of Cash Flow Statement, of the Cash Flows for the period ended on that date. Report on Other Legal and Regulatory Requirements 1. As required by the Companies (Auditors Report) Order, 2003 issued by the Central Government of India in terms of Section 227(4A) of the Act, we give in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the order. 2. As required by section 227(3) of the Act, we report that: a. 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; b. In our opinion proper books of account as required by law have been kept by the Company so far as appears from our examination of those books c. The Balance Sheet and Statement of Profit and Loss and the Cash Flow Statement dealt with by this Report are in agreement with the books of account. d. In our opinion, the Balance Sheet and Statement of Profit and Loss and the Cash Flow Statement comply with the Accounting Standards referred to in subsection (3C) of section 211 of the Companies Act, 1956; e. On the basis of written representations received from the directors as on March 31, 2013, and taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2013, from being appointed as a director in terms of clause (g) of sub-section (1) of section 274 of the Companies Act, 1956. For Rashmi & Co. Chartered Accountants Firm Regn. No. 309122E CA Sandeep Agarwal Partner Membership No. : 065643 213, Todi Chambers 2, Lal Bazaar Chambers Phone: 033 2230 2329 Email: rashmico@icai.org Dated: 15th May, 2013
c)
38

Annexure to the Independent Auditors Report

(REFERRED TO IN PARAGRAPH 1 UNDER THE HEADING OF REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS OF OUR REPORT OF EVEN DATE) (i) (a) The Company has maintained proper records showing full particulars, including quantitative details and situation of fixed assets on the basis of available informations. (b) All fixed assets have not been physically verified by the management during the period but there is a regular programme of verification in a phased manner to cover all the items of fixed assets over a period of three years which, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. No material discrepancies were noticed on such verification. (c) There was no disposal of substantial part of fixed assets during the period. (ii) (a) T h e m a n a g e m e n t h a s conducted physical verification of inventory at reasonable intervals during the period, except for bulk raw materials which has been physically verified by an independent chartered engineer whose report has been relied upon by us. (b) The procedures of physical verification of inventory followed by the management are reasonable and adequate in relation to the size of the Company and the nature of its business. (c) The Company is maintaining proper records of inventory and no material discrepancies were noticed on physical verification. (iii) (a) The Company had granted loan to a Company covered in the register maintained under section 301 of the Companies Act, 1956. The maximum amount involved during the period was ` 8,500.00 lacs and the period-end balance in respect of such loan is ` 8,500.00 lacs. (b) In our opinion and according to the information and explanations given to us, the rate of interest and other terms and conditions for such loan are not prima facie prejudicial to the interest of the Company. (c) The above loan is stated to be re-payable on demand. As informed, the Company has not demanded repayment of any such loan during the year, and thus, there has been no default on the part of such party to whom the money has been lent. The payment of interest has been regular. (d) In view of the loan being repayable on demand, there is no overdue of loan granted to the Company listed in the register maintained under section 301 of the Companies Act, 1956. (e) According to the information and explanation given to us, the Company has not taken any loans, from companies, covered in the register maintained under section 301 of the Companies Act, 1956. Accordingly, clauses (f) and (g) of Para 4(iii) are not applicable to the Company. During the course of our audit, we have not observed any major weakness or any continuing failure to correct any major weakness in internal control system of the Company in respect of these areas. (v) (a) According to the information and explanations provided by the management, we are of the opinion that the particulars of contracts or arrangements referred to in section 301 of the Companies Act, 1956, that need to be entered into the register maintained under section 301 have been so entered. (b) In our opinion and according to the information and explanations given to us, the transactions made in pursuance of such contracts or arrangements exceeding the value of Rupees five lakhs, entered into during the financial period, have been made at prices which are reasonable having regard to the prevailing market prices at the relevant time. (vi) The Company has not accepted any deposits from the public within the meaning of section 58A, 58AA or any other relevant provisions of the Companies Act, 1956. (vii) The Company has an effective internal audit system commensurate with the nature and size of the Company. (viii) We have broadly reviewed the books of account maintained by the Company pursuant to the rules made by the Central Government for the maintenance of cost records under section 209(1)(d) of the Companies Act, 1956, related to the manufacture of its products and are of the opinion that prima facie, the prescribed accounts and records have been made and maintained.
(iv) In our opinion and according to the information and explanations given to us, and having regard to the explanation that some of the items purchased are of a special nature and alternative sources do not exist for obtaining quotations thereof, there is an adequate internal control system commensurate with the size of the Company and the nature of its business, for the purchase of inventory and fixed assets and for the sale of goods and services.
39

Annexure to the Auditors Report (Contd.)

(ix) (a) Undisputed statutory dues including provident fund, investor education and protection fund, employees state insurance, income-tax, sales-tax, wealth-tax, service tax, customs duty, excise duty, cess and other material statutory dues have generally been regularly deposited with the appropriate authorities, except that there have been delays Name of the statute Central Excise Act, 1944 in deposit of dues in certain cases. (b) According to the information and explanations given to us, no undisputed amounts payable in respect of provident fund, investor education and protection fund, employees state insurance, income-tax, sales- tax, wealth-tax, service tax, customs duty, excise duty, cess and other material statutory dues were Amount (` in lacs) 2,321.89 outstanding, at the period-end, for a period of more than six months from the date they became payable. (c) According to the records of the Company, the dues outstanding of income-tax, sales-tax, wealth-tax, service tax, customs duty, excise duty and cess on account of any dispute, are as follows: Forum where dispute is pending Central Excise Service Tax Appellate Tribunal/ Commissioner (Appeals) Central Excise Service Tax Appellate Tribunal/ Commissioner (Appeals) West Bengal Appellate and Revision Board West Bengal Appellate and Revision Board/ Sr. Joint Commissioner Sales Tax West Bengal Appellate and Revision Board/Sr. Joint Commissioner Sales Tax
Nature of dues
Period to which the amount relates 2005-06, 2006-07 and 2007-08
CENVAT Credit Disallowed
Central Excise Act, 1944
Differential Duty
1,139.26
2005-06, 2006-07, 2007-08 and 2010-11
The West Bengal Value Added Tax Act, 2003 The Central Sales Tax Act, 1956
Pending Forms
3.59
2004-05
Pending Forms/ Forms Disallowed
688.59
2004-05, 2005-06 2006-07, 2007-08 and 2008-09
The West Bengal Value Added Tax Act, 2003
Turnover Enhanced/ITC disallowed
6,048.40
2005-06, 2006-07, 2007-08 and 2008-09
(x)
The accumulated losses of the Company at the end of the financial period are less than fifty percent of its net worth. The Company has incurred cash losses in current and immediately preceding financial year. Based on our audit procedures and as per the information and explanations given by the management, we are of the
(xi)
opinion that the Company has not defaulted in repayment of dues to any financial institution and bank read with the fact that the term loans have been rescheduled as per the corporate debt restructuring scheme approved during the year as stated in Note No. 30. Further the Company did not have any outstanding debentures during the year.
(xii) According to the information and explanations given to us and based on the documents and records produced before us, the Company has not granted loans and advances on the basis of security by way of pledge of shares, debentures and other securities. (xiii) In our opinion, the Company is not a chit fund or a nidhi /
40


mutual benefit fund / society. Therefore, the provisions of clause 4(xiii) of the Order are not applicable. (xiv) In our opinion, the Company is not dealing or trading in shares, securities, debentures and other investments. Accordingly, the provisions of clause 4(xiv) of the Order are not applicable to the Company. (xv) According to the information and explanations given to us, the Company has given guarantee for loans taken by its wholly owned subsidiary / others from banks; the terms and conditions whereof in our opinion are not prima-facie prejudicial to the interest of the Company. (xvi) Based on the information and explanations given to us by the management, term loans were applied for the purpose for which the loans were obtained. (xvii) According to the information and explanations given to us and on an overall examination of the balance sheet of the Company, we report that no funds raised on short-term basis have been used for long-term investment. (xviii) The Company has not made any preferential allotment of shares during the year to parties and companies covered in the register maintained under section 301 of the Companies Act, 1956. (xix) The Company did not have outstanding debentures during the period. (xx) The Company has not raised any money through public issue during the period. (xxi) Based upon the audit procedures performed for the purpose of reporting the true and fair view of the financial statements and as per the information and explanations given by the management, we report that no fraud on or by the Company has been noticed or reported during the period.
For U. Narain & Co. Chartered Accountants Firm Regn. No. 000935C CA R. R. Modi Partner Membership No. : 053118 27, Brabourne Road, Narayani Building 5th Floor, Room No.503 Phone: 033 3053 3386 (5 lines) Email: unaraincokol@gmail.com Dated: 15th May, 2013
For Rashmi & Co. Chartered Accountants Firm Regn. No. 309122E CA Sandeep Agarwal Partner Membership No. : 065643 213, Todi Chambers 2, Lal Bazaar Chambers Phone: 033 2230 2329 Email: rashmico@icai.org Dated: 15th May, 2013
41

Balance Sheet as at March 31, 2013

Notes EQUITY AND LIABILITIES Shareholders Fund Share Capital Reserves and Surplus Money Received against share warrants Non Current Liabilities Long Term Borrowings Deferred Tax Liabilities (Net) Current Liabilities Short Term Borrowings Trade Payables Other Current Liabilities Short Term Provisions TOTAL ASSETS Non Current Assets Fixed Assets Tangible Assets Capital Work in Progress and Pre-Operative Expenditure Pending Allocation Non Current Investments Deferred Tax Assets (Net) Long Term Loans and Advances Other Non Current Assets Current Assets Inventories Trade Receivables Cash and Bank Balances Short Term Loans and Advances Other Current Assets TOTAL Significant Accounting Policies The accompanying notes are an integral part of the financial statements As per our report of even date For U. Narain & Co. Chartered Accountants Firm Regn. No. 000935C CA R. R. Modi Partner Membership No. : 053118 Place : Kolkata Date : May 15, 2013 For Rashmi & Co. Chartered Accountants Firm Regn. No. 309122E CA Sandeep Agarwal Partner Membership No. : 065643 2 As at March 31, 2013
(` in lacs) As at June 30, 2012
3 4
6,377.76 42,109.52 2,509.25 50,996.53
6,377.11 63,422.30 -69,799.41 49,219.08 1,830.52 51,049.60 115,825.87 79,347.94 74,077.33 455.02 269,706.16 390,555.17
5 12
172,868.35 -172,868.35
6 7 7 8
52,434.26 93,652.62 29,490.31 650.04 176,227.23 400,092.11
9 10 11 12 13 14
196,878.57 11,181.50 8,097.10 8,455.89 11,577.51 1,171.32 237,361.89
155,080.56 58,465.12 8,095.60 -12,096.71 114.41 233,852.40 80,894.03 48,684.99 2,093.06 15,573.48 9,457.21 156,702.77 390,555.17
15 16 17 13 18
59,434.70 69,220.61 3,957.32 18,518.16 11,599.43 162,730.22 400,092.11
For and on behalf of the Board of Directors Aditya Jajodia Chairman & Managing Director Rajiv Jajodia Director Sanjiv Jajodia Wholetime Director Raj Kumar Sharma Chief Financial Officer
Ajay Kumar Tantia Company Secretary
42

Statement of Profit and Loss for 9 months period ended March 31, 2013
Notes 9 months period ended March 31, 2013 169,572.58 15,088.83 154,483.75 2,173.87 156,657.62
(` in lacs) 15 months period ended June 30, 2012 316,271.22 22,948.10 293,323.12 2,578.09 295,901.21
INCOME Revenue from Operations (Gross) Less: Excise Duty Revenue from Operations (Net) Other Income Total Revenue (I) EXPENSES Cost of Materials Consumed Purchase of Stock in Trade Changes in Inventories of Finished Goods, Work-in-Progress and Stock-in-Trade Employee Benefits Expense Finance Costs Depreciation and Amortisation Expense Other Expenses Total Expenses (II) Profit / (Loss) before Tax (I-II) Tax Expenses: Current Tax Expenses [Including ` 1.47 lacs (` Nil) for earlier Year] Deferred Tax Charge / (Credit) Total Tax Expense / (Credit) Profit/(Loss) for the period Earnings per Equity Share: (Nominal Value per Share ` 10) Basic & Diluted Significant Accounting Policies The accompanying notes are an integral part of the financial statements
19 19 20
21 21 22 23 24 9 25
106,210.26 155.72 15,085.13 4,936.10 17,644.70 8,612.67 35,610.75 188,255.33 (31,597.71)
234,512.74 126.62 (13,816.49) 7,310.06 31,999.68 13,875.94 60,776.74 334,785.29 (38,884.08)
1.47 (10,286.40) (10,284.93) (21,312.78) (33.42) 2
--(11,278.46) (11,278.46) (27,605.62) (43.28)
As per our report of even date For U. Narain & Co. Chartered Accountants Firm Regn. No. 000935C CA R. R. Modi Partner Membership No. : 053118 Place : Kolkata Date : May 15, 2013 For Rashmi & Co. Chartered Accountants Firm Regn. No. 309122E CA Sandeep Agarwal Partner Membership No. : 065643
43

Cash Flow Statement for 9 months period ended March 31, 2013
(` in lacs) 9 months period ended March 31, 2013 A: Cash Flow From Operating Activities Net Profit / (Loss) Before Taxes Adjustments For : Depreciation /Amortisation (Net) Loss on Sale of Fixed Assets Irrecoverable Debts and Advances Written off Liabilities no longer required written back Interest on Term Loans and Others Provision for Diminution in the value of Investments Provision for doubtful debts no longer required written back Dividend from long term Non Trade Investments Loss on sale of long term Non Trade Investments Prior Period Expenditure (net) (Profit) / Loss on Foreign Exchange Fluctuations (Net) Interest Income Operating Profit / (Loss) Before Working Capital Changes Movements in Working Capital : Decrease / (Increase) in Trade Receivables Increase in Loans and Advances and Other Current / Non Current Assets Decrease / (Increase) in Advances to Subsidiary Company Decrease / (Increase) in Inventories Decrease in Trade Payables, Other Liabilities and Provisions Cash generated from / (used in) Operating Activities Direct Taxes paid ( net of refunds) Net Cash generated from / (used in) Operating Activities B: Cash Flow From Investing Activities Purchase of Fixed Assets Proceeds from Sale of Fixed Assets Purchase of Investments in Joint Venture Companies Purchase of Investments in Government Securities Application money paid in Joint Venture Companies Proceeds from sale of long term Investments (other than trade) Proceeds from maturity of fixed deposits Dividend from long term Investments (other than Trade) Dividend from a Subsidiary Company Loan to Related Party Interest received Net Cash Used In Investing Activities (31,597.71) 8,612.67 2.72 38.16 (233.69) 17,708.70 -(122.04) (0.67) -38.84 (381.93) (1,386.32) (7,321.27) (24,933.43) (1,893.79) (567.20) 21,459.33 8,284.71 (4,971.65) (171.41) (5,143.06) 15 months period ended June 30, 2012 (38,884.08) 13,875.94 12.08 82.83 (425.04) 29,570.79 100.89 -(0.47) 150.00 353.98 912.96 (1,962.15) 3,787.73 5,244.77 (3,854.59) 2,310.32 (23,727.44) 48,224.03 31,984.82 (1,592.92) 30,391.90
(3,437.05) 21.37 -(1.50) (70.99) --0.67 --1,312.26 (2,175.24)
(20,013.06) 47.24 (53.34) (2.00) (111.93) 50.00 81.33 0.47 34.95 (5,000.00) 1,821.13 (23,145.21)
44

Cash Flow Statement (Contd.)

(` in lacs) 9 months period ended March 31, 2013 C: Cash Flow From Financing Activities Proceeds from Call in Arrears of equity share capital Money Received against share warrants Proceeds from long / short term Borrowings Repayment of long / short term Borrowings Interest Paid (including interest capitalised) Dividend Paid Tax on Dividend paid Net Cash generated from Financing Activities Net Increase / (Decrease) In Cash and Cash Equivalents (A+B+C) Cash and Cash Equivalents as at the beginning of the year Cash and Cash Equivalents as at the end of the year Components of Cash and Cash Equivalents Cash on hand Cheques in hand Balance with Scheduled Banks on: Current Account Fixed Deposit Account Unclaimed Dividend Account * Unclaimed Fractional Share Balance* Cash and Bank Balances as per Note 17 Less : Fixed deposits not considered as cash equivalents Cash and Cash Equivalents in Cash Flow Statement 310.10 4,164.53 2.96 0.16 5,113.08 4,164.53 948.55 113.99 1,845.15 4.73 0.16 2,200.71 1,845.15 355.56 54.60 580.73 139.65 97.03 0.65 2,509.25 12,385.10 (2,659.44) (4,322.50) (1.77) -7,911.29 592.99 355.56 948.55 --56,237.43 (35,464.26) (29,231.76) (255.65) (35.73) (8,749.97) (1,503.28) 1,858.84 355.56 15 months period ended June 30, 2012
* These balances are not available for use by the Company as they represent corresponding unpaid dividend and unclaimed fractional share balances.
45

Notes to Financial Statements for the period ended March 31, 2013
1. General Information Jai Balaji Industries Limited (the Company) is a public Company domiciled in India and incorporated under the provisions of the Companies Act, 1956. Its shares are listed on three stock exchanges in India (Bombay Stock Exchange, National Stock Exchange and Calcutta Stock Exchange). The Company is engaged in the manufacture and sale of steel and allied products. 2. Summary of Significant Accounting Policies (a) Basis of preparation The financial statements of the Company have been prepared in accordance with generally accepted accounting principles in India. The Company has prepared these financial statements to comply in all material respects with the accounting standards notified by the Companies (Accounting Standards) Rules, 2006, to the extent applicable (as amended) and the relevant provisions of the Companies Act, 1956. The financial statements have been prepared under the historical cost convention on an accrual basis. The accounting policies have been consistently applied by the Company and except for the changes discussed more fully below, are consistent with those used in the previous year. (b) Use of estimates The preparation of financial statements in conformity with generally accepted accounting principles requires the management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at the date of the financial statements and the results of operations during the reporting period end. Although these estimates are based upon the managements best knowledge of current events and actions, actual results could differ from these estimates. (c) Tangible Fixed Assets Fixed assets are stated at cost less accumulated depreciation and impairment losses if any. Cost comprises the purchase price inclusive of duties (net of CENVAT and VAT Credit), taxes, incidental expenses, erection/commissioning expenses and interest etc., upto the date the asset is ready to be put to use. Own produced materials used for fixed assets are capitalised at cost. Machinery spares which can be used only in connection with a particular item of fixed asset and whose use as per technical assessment is expected to be irregular, are capitalised and depreciated prospectively over the residual life of the respective asset. (d) Depreciation i) The classification of Plant and Machinery into continuous and noncontinuous process is done as per technical certification and depreciation thereon is provided accordingly. Company is provided @ 10% p.a. as against 4.75% p.a. as prescribed in Schedule XIV because of the conditions prescribed in the agreement with Indian Railway Authorities. iv) Pipe Moulds for Ductile Iron Foundry Works are depreciated over a period of 4 years. v) In case of impairment, if any, depreciation is provided on the revised carrying amount of the assets over their remaining useful life. (e) Borrowing Costs Borrowing costs relating to acquisition / construction of qualifying assets are capitalized until the time all substantial activities necessary to prepare the qualifying assets for their intended use are complete. A qualifying asset is one that necessarily takes substantial period of time to get ready for its intended use. All other borrowing costs are charged to revenue. (f) Impairment The carrying amounts of assets are reviewed at each balance sheet date if there is any indication of impairment based on internal/external factors. An impairment loss is recognized wherever the carrying amount of an asset exceeds its recoverable amount. The recoverable amount is the greater of the assets net selling price and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and risks specific to the asset.
ii) Depreciation is provided using the Straight Line Method as per the useful lives of the assets estimated by the management which is equal to the rates prescribed under schedule XIV of the Companies Act, 1956 except for Railway Wagons and Moulds as stated below. iii) Depreciation on Railway Wagons acquired by the
46

Notes to Financial Statements (Contd.)

After impairment, depreciation is provided on the revised carrying amount of the asset over its remaining useful life. (g) T a n g i b l e F i x e d A s s e t s acquired under Finance Lease Assets acquired under lease agreements which effectively transfer to the Company substantially all the risks and benefits incidental to ownership of the leased item, are capitalized at the lower of the fair value and present value of the minimum lease payments at the inception of the lease term and disclosed as leased assets. Lease payments are apportioned between the finance charges and reduction of the lease liability based on the implicit rate of return. Finance charges are charged directly to expense. If there is no reasonable certainty that the Company Raw materials will obtain the ownership by the end of the lease term, capitalized leased assets are depreciated over the shorter of the estimated useful life of the asset or the lease term. (h) Government grants and subsidies Grants and subsidies from the government are recognized when there is a reasonable assurance that the grant/ subsidy will be received and all attaching conditions will be complied with. When the grant or subsidy relates to an expense item, it is recognized as income over the periods necessary to match them on a systematic basis to the costs, which it is intended to compensate. Where the grant or subsidy relates to an asset, its value is deducted in arriving at the carrying amount of the related asset. Government grants of the nature of promoters contribution are credited to capital reserve and treated as a part of shareholders funds. (i) Investments Investments that are readily realisable and intended to be held for not more than a year are classified as current investments. All other investments are classified as long-term investments. Current investments are carried at lower of cost and fair value determined on an individual investment basis. Long-term investments are carried at cost. However, provision for diminution in value is made to recognize a decline other than temporary in the value of the investments. (j) Inventories Inventories are valued as follows:
At lower of cost and net realizable value. However, materials and other items held for use in the production of inventories are not written down below cost if the finished products in which they will be incorporated are expected to be sold at or above cost. Cost is determined on a weighted average basis. At lower of cost and net realizable value. Cost is determined on First in First Out basis except for Durg unit where the cost is determined on weighted average basis. At lower of cost and net realizable value. Cost includes direct materials and labour and a proportion of manufacturing overheads based on normal operating capacity. Cost of finished goods includes excise duty. Cost is determined on a weighted average basis. At net realizable value.
Stores and Spares Work-in- Process and Finished Goods Scrap and By Products
Net realizable value is the estimated selling price in the ordinary course of business, less estimated costs of completion and estimated costs necessary to make the sale. (k) Revenue Recognition Revenue is recognized to the extent that it is probable that the economic benefits will flow to the Company and the revenue can be reliably measured. Sale of Goods Revenue from sale of goods is recognized on passage of title thereof to the customers, which generally coincides with delivery. Further, sales are inclusive of excise duty and are net of returns, claims, rebates, discounts, Sales Tax, VAT etc. Income from Services Income from Services is recognized on performance of the contract and acceptance of the services by the customers. Interest Revenue is recognised on a time proportion basis taking into account the amount outstanding and the rate applicable. Dividend Dividend income is recognized when the shareholders right to receive payment is established by the balance sheet date.
47


(l) Foreign currency transactions (i) Initial Recognition Foreign currency transactions are recorded in the reporting currency, by applying to the foreign currency amount the exchange rate between the reporting currency and the foreign currency at the date of the transaction. (ii) Conversion Foreign currency monetary items are reported using the closing rate. Non-monetary items which are carried in terms of historical cost denominated in a foreign currency are reported using the exchange rate at the date of the transaction; and non-monetary items which are carried at fair value or other similar valuation denominated in a foreign currency are reported using the exchange rates that existed when the values were determined. (iii) Exchange Differences Exchange differences arising on the settlement /conversion of monetary items are recognized as income or as expenses in the period in which they arise. (iv) F o r w a r d E x c h a n g e Contracts not intended for trading or speculation purposes The premium or discount arising at the inception of forward exchange contracts is amortised as expense or income over the life of the contract. Exchange differences on such contracts are recognised in the statement of profit and loss in the year in which the exchange rates change. Any profit or loss arising on cancellation or renewal of forward exchange contract is recognised as income or as expense for the year. (m) R e t i r e m e n t a n d o t h e r employee benefits i. Retirement benefit in the form of Provident Fund is a defined contribution scheme and the contribution is charged to statement of profit and loss of the year when the contributions to the respective fund is due. There is no other obligation other than the contribution payable to provident fund. Gratuity liability is a defined benefit obligation and is provided for on the basis of actuarial valuation on projected unit credit method made at the end of each financial year. Unrecognised past service cost arising at the time of change in plan measures are charged to statement of profit and loss on a straight line basis over the period of vesting of the defined benefit obligation. authorities in accordance with the Income Tax Act, 1961 enacted in India. Deferred income taxes reflect the impact of current year timing differences between taxable income and accounting income for the year and reversal of timing differences of earlier years. Deferred tax is measured based on the tax rates and the tax laws enacted or substantially enacted at the Balance Sheet date. Deferred tax assets and deferred tax liabilities are offset, if a legally enforceable right exists to set off current tax assets against current tax liabilities and the deferred tax assets and deferred tax liabilities relate to the taxes on income levied by same governing taxation laws. Deferred tax assets are recognized only to the extent that there is reasonable certainty that sufficient future taxable income will be available against which such deferred tax assets can be realized. In situations where the Company has unabsorbed depreciation or carry forward tax losses, deferred tax assets are recognized only if there is virtual certainty supported by convincing evidence that they can be realized against future taxable profits. At each balance sheet date the Company re-assesses unrecognized deferred tax assets. It recognizes unrecognized deferred tax assets to the extent that it has become reasonably certain or virtually certain, as the case may be that sufficient future taxable income will be available against which such deferred tax assets can be realised. The carrying amount of deferred tax assets are reviewed at each balance sheet date. The Company writesdown the carrying amount of
ii.
iii. Short term compensated absences are provided for based on estimates whereas long term compensated absences are provided for on the basis of actuarial valuation, as per projected unit credit method. iv. Actuarial gains/losses are immediately taken to statement of profit and loss and are not deferred. (n) Taxation Tax expense comprises of current and deferred tax. Current income tax is measured at the amount expected to be paid to the tax
48


a deferred tax asset to the extent that it is no longer reasonably certain or virtually certain, as the case may be, that sufficient future taxable income will be available against which deferred tax asset can be realised. Any such write-down is reversed to the extent that it becomes reasonably certain or virtually certain, as the case may be, that sufficient future taxable income will be available. Minimum Alternate Tax (MAT) credit is recognised as an asset only when and to the extent there is convincing evidence that the Company will pay normal income tax during the specified period. In the year in which the MAT credit becomes eligible to be recognized as an asset in accordance with the recommendations contained in Guidance Note issued by the Institute of Chartered Accountants of India, the said asset is created by way of a credit to the statement of profit and loss and shown as MAT Credit Entitlement. The Company reviews the same at each Balance Sheet date and writes down the carrying amount of MAT Credit Entitlement to the extent there is no longer convincing evidence to the effect that the Company will pay normal Income Tax during the specified period. (o) Expenditure on new projects and substantial expansion Expenditure directly relating to construction activity are capitalised. Indirect expenditure incurred during construction period are capitalised as part of the indirect construction cost to the extent to which the expenditure are indirectly related to construction or are incidental thereto. Other indirect expenditure (including borrowing costs) incurred during the construction period which are not related to the construction activity nor are incidental thereto are charged to the statement of profit and loss. Income earned during construction period is deducted from the total of the indirect expenditure. All direct capital expenditure on expansion are capitalised. As regards indirect expenditure on expansion, only that portion is capitalised which represents the marginal increase in such expenditure involved as a result of capital expansion. Both direct and indirect expenditure are capitalised only if they increase the value of the asset beyond its original standard of performance. (p) Segment Reporting Policies Based on the synergies, risks and returns associated with business operations and in terms of Accounting Standard-17, the Company is predominantly engaged in a single reportable segment of Iron and Steel during the year. The risks and returns of existing captive power plants are directly associated with the manufacturing operations of Iron and Steel and hence treated as a single reportable segment as per Accounting Standard-17. The Company at present primarily operates in India and therefore the analysis of geographical segments is not applicable to the Company. (q) Earnings Per Share Basic earning per share is calculated by dividing the net profit or loss for the year attributable to equity shareholders by the weighted average number of equity shares outstanding during the year. Partly paid equity shares/ instruments are treated as a fraction of an equity share to the extent that they were entitled to participate in dividends relative to a fully paid equity share during the reporting year. For the purpose of calculating diluted earnings per share, the net profit or loss for the year attributable to equity shareholders and the weighted average number of shares outstanding during the year are adjusted for the effects of all dilutive potential equity shares. (r) Provisions A provision is recognised when an enterprise has a present obligation as a result of past event and it is probable that an outflow of resources will be required to settle the obligation, in respect of which a reliable estimate can be made. Provisions are not discounted to their present value and are determined based on best estimates required to settle the obligation at the balance sheet date. These are reviewed at each Balance Sheet date and adjusted to reflect the current best estimates. (s) Cash and Cash Equivalents Cash and cash equivalents as indicated in the Cash Flow Statement comprise cash at bank and on hand and shortterm investments with an original maturity of three months or less. (t) Contingent Liabilities Contingent liabilities are not provided for in the accounts and are separately disclosed in the Financial statements. (u) Basis of classification of Current and Non Current Assets and Liabilities in the balance sheet have been classified as either current or non-current based upon the requirements of Revised Schedule VI notified under the Companies Act, 1956.
49


An asset has been classified as current if (a) it is expected to be realized in, or is intended for sale or consumption in, the Companys normal operating cycle; or (b) it is held primarily for the purpose of being traded; or (c) it is expected to be realized within twelve months after the reporting date; or (d) it is cash or cash equivalent unless it is restricted from being Note 3 : Share Capital As at March 31, 2013 Authorised capital 101,000,000 (101,000,000) Equity Shares of ` 10/- each Issued, subscribed and fully paid-up capital 63,781,486 (63,781,486) Equity Shares of ` 10/- each Less: Calls unpaid (Due from other than directors or officers) Total 10,100.00 6,378.15 0.39 6,377.76 exchanged or used to settle a liability for at least twelve months after the reporting date. All other assets have been classified as non-current. A Liability has been classified as current when (a) it is expected to be settled in the Companys normal operating cycle; or (b) it is held primarily for the purpose of being traded; or (c) it is due to be settled within twelve months after the reporting date; or (d) the Company does not have an unconditional right to defer settlement of the liability for at least twelve months after the reporting date. An operating cycle is the time between the acquisition of assets for processing and their realization in cash or cash equivalents. (` in lacs) As at June 30, 2012 10,100.00 6,378.15 1.04 6,377.11
(a) Reconciliation of the shares outstanding at the beginning and at the end of the reporting period : As at March 31, 2013 No. of Shares (` in lacs) Equity Shares of ` 10/- each At the beginning of the period Call money received during the period At the end of the period 63,781,486 -63,781,486 6,377.11 0.65 6,377.76 As at June 30, 2012 No. of Shares (` in lacs) 63,781,486 -63,781,486 6,377.11 -6,377.11
(b) Terms/rights attached to equity shares The Company has only one class of ordinary shares (equity shares) having at par value of ` 10/- each. Each shareholder of ordinary shares (equity shareholders) is entitled to one vote per share. The Company declares and pays dividend in Indian Rupees. The dividend proposed by the Board of Directors is subject to approval of the shareholders in the ensuing annual general meeting except in the case of interim dividend. In the event of liquidation, the equity shareholders are eligible to receive the remaining assets of the Company after distributions of all preferential amounts, in the proportions to their share holdings. (c) Details of shareholders holding more than 5% shares in the Company As at March 31, 2013 No. of Shares % holding in the class Enfield Suppliers Ltd. Hari Management Ltd. CVCIGP II Client Rosehill Limited Aditya Jajodia 11,221,233 7,044,533 3,886,734 3,674,576 25,827,076 17.59 11.04 6.09 5.76 40.48 As at June 30, 2012 No. of Shares % holding in the class 11,221,233 7,044,533 3,886,734 3,203,065 25,355,565 17.59 11.04 6.09 5.02 39.74
As per records of the Company, including its register of shareholders/members, the above share holdings represents legal ownership of shares.
50


(d) Aggregate number of shares issued for consideration other than cash during the period of five years immediately preceding the reporting date As at March 31, 2013 No. of Shares Equity Shares allotted as fully paid up for consideration other than cash Note 4 : Reserves & Surplus As at March 31, 2013 Capital Reserve As per last Financial Statements Amalgamation Reserve As per last Financial Statements Securities Premium Account As per last Financial Statements General Reserve As per last Financial Statements Surplus/(Deficit) in Statement of Profit & Loss As per last financial statements Add: Profit/(Loss) for the period Surplus/ (Deficit) in Statement of Profit & Loss Total 6,408.50 4,400.00 46,017.50 10,325.00 (3,728.70) (21,312.78) (25,041.48) 42,109.52 22,000,000 As at June 30, 2012 No. of Shares 22,000,000 (` in lacs) As at June 30, 2012 6,408.50 4,400.00 46,017.50 10,325.00 23,876.92 (27,605.62) (3,728.70) 63,422.30
Note 5 : Long Term Borrowings Non Current Portion As at March 31, 2013 (Secured, unless otherwise stated) Term Loans Rupee Loan from banks Rupee Loan from Financial Institutions Rupee Loan from Financial Institution (Unsecured) Rupee Loan from Others Foreign Currency Loan from banks Deferred Payments Liabilities Other Loan and Advances Interest Free Sales Tax Loan (Unsecured) Total Amount disclosed under the head Other Current Liabilities (Refer Note 7) Total -172,868.35 -172,868.35 -49,219.08 -49,219.08 186.44 10,827.04 (10,827.04) -167,443.31 5,271.55 -141.58 -11.91 42,777.63 1,606.62 3,625.00 460.41 730.65 18.78 1,704.50 8,093.01 -822.64 -20.45 As at June 30, 2012 Current Portion As at March 31, 2013
(` in lacs)
As at June 30, 2012
26,121.20 2,320.02 5,505.64 991.82 6,995.95 28.07 358.93 42,321.64 (42,321.64) --
51


1) Rupee Loan from banks and Financial Institution (except to the extent stated in point no. 2 below) a) Rupee Term Loan from banks and financial institution are secured by pari-passu 1st charge over the entire fixed assets (both present and future) and 2nd charge over the entire current assets (both present and future) of the Companys units at Ranigunge and Durgapur in the state of West Bengal and Durg in the state of Chhattisgarh. The above loan are further secured as follows : (i) Personal Guarantees of Promoter Directors of the Company. (ii) Corporate Guarantee of M/s. Shri Marutaye Balaji Steels Limited, a promoter group company (iii) Assignment of mining rights for limestone mines at Satna, Madhya Pradesh of M/s Shri Marutaye Balaji Steels Limited (iv) Pledge of equity shares of the Company held by the promoters b) Rupee Term Loan from banks and financial institution carry interest as follows: (i) term loan and working capital term loan aggregating ` 154,515.11 lacs at base rate of individual lenders plus spread, where spread is computed as difference between 11.75% p.a. and base rate of the individual lenders as on 16th June, 2012. (ii) funded interest term loan aggregating ` 19,200.87 lacs at base rate of lead banker ( UCO Bank). c) The above loans are repayable as under from the balance sheet date : Payment Terms Installments Due (i) (ii) (iii) (iv) Within 1 year One year to three year Three year to five year More than five year 35 structured quarterly installments starting from June 2013 Number 4 8 8 15 35 2) (` in lacs) 1,751.51 39,647.25 46,515.60 85,801.59 173,715.95
Rupee Term Loan from a Financial Institution aggregating ` 8,796.42 lacs carry interest in the range of 14.50% - 15% p.a. and is repayable in 8 equal quarterly installments starting from 15th May, 2012/14th December, 2012. The loan is secured by Bank Guarantee, pledge of certain promoters shareholdings in the Company and personal guarantees of certain promoter directors. Rupee Term Loan from others carry interest in the range of 13.65% - 14% p.a. and is repayable in 34 monthly installments starting from August 2011. The loan is secured by exclusive charge over the assets acquired under respective loan agreements and personal guarantee of certain promoter directors of the Company. Deferred Payment Liabilities carry interest rate of 9.40% to 10.43% and are repayable in 36/42 equal monthly installments from the date of disbursement of the loan amounts. These loans are secured by hypothecation of respective assets acquired there from. Sales tax loan from Government of Chhattisgarh is interest free and is repayable in 12 yearly installments starting from 31st March, 2002 (` in lacs) As at March 31, 2013 As at June 30, 2012
3)
4)
5)
Note 6 : Short Term Borrowings
Secured Loan Repayable on Demand - Cash Credit from Banks Other Loan and advances Short Term Loans from Banks Total -52,434.26 29,500.00 115,825.87 52,434.26 86,325.87
52


Cash Credit facilities from banks are secured by pari-passu 1st charge over the entire current assets (both present and future) and 2nd charge over the entire fixed assets (both present and future) of the Companys units at Ranigunge and Durgapur in the state of West Bengal and Durg in the state of Chhattisgarh. The above facilities are further secured as follows : (i) Personal Guarantees of Promoter Directors of the Company. (ii) Corporate Guarantee of M/s. Shri Marutaye Balaji Steels Limited, a promoter group company (iii) Assignment of mining rights for limestone mines at Satna, Madhya Pradesh of M/s. Shri Marutaye Balaji Steels Limited (iv) Pledge of equity shares of the Company held by the promoters Note 7 : Trade Payables and other Current Liabilities As at March 31, 2013 Trade Payables (Refer Note 34 for details due to Micro and Small Enterprises) - Raw materials [including acceptances of ` 16,347.43 lacs (` 8,169.57 lacs)] - Others (` in lacs) As at June 30, 2012
62,378.27 31,274.35 93,652.62
54,049.74 25,298.20 79,347.94 42,321.64 4,313.00 191.83 5,848.44 10,292.35 309.04 932.29
Current Maturities of Long Term Borrowings (Refer Note 5) Capital Creditors Interest Accrued but not due on Borrowings Interest Accrued and due on Borrowings Advance from Customer Advances from a Subsidiary Company (Refer Note 32) Temporary Book Overdraft Investor Education and Protection Fund will be credited by the following amounts (as and when due) - Unclaimed Dividend - Unclaimed Fractional Share Liabilities Others - Statutory Dues Payable - Excise Duty payable on Closing Stock - Interest Others - Due to Employees - Other Miscellaneous Total Note 8 : Short Term Provisions
10,827.04 4,089.41 66.76 158.84 7,865.88 -214.12
2.95 0.16 3,631.71 907.84 374.99 1,281.55 69.06 29,490.31 123,142.93
4.72 0.16 4,968.84 3,085.95 522.69 1,200.65 85.73 74,077.33 153,425.27 (` in lacs)
As at March 31, 2013 Provision for employee benefits : Gratuity (Refer Note 33) Leave Salary Other Provision : Provision for Taxation [Net of Advance Tax ` Nil (` 3,724.49 lacs)] Provision for Wealth Tax Total -0.45 650.04 528.64 120.95
As at June 30, 2012 340.71 105.90 7.98 0.43 455.02
53


Note 9 : Tangible Assets
Gross Block Description
Freehold Land Leasehold Land Factory Buildings Railway Siding Plant and Machinery Electrical Installations Furniture, Fixtures Office Equipments Vehicles Total Previous Years Total
(` in lacs)
Depreciation / Amortisation As at March 31, 2013
4,175.66 707.57 40,460.89 4,354.18 172,906.05 24,395.01 116.17 877.78 217.42 248,210.73 197,814.02
Net Block As at As at March 31, 2013 March 31, 2013

125.95 4,055.75 957.81 40,560.44 4,930.90 46.92 549.63 104.76 51,332.16 4,175.66 581.62 36,405.14 3,396.37 132,345.61 19,464.11 69.25 328.15 112.66 196,878.57
As at June 30, 2012

3,325.54 707.57 27,644.50 4,352.36 140,310.93 20,261.55 115.51 863.24 232.82 197,814.02 193,677.88
Additions
850.12 12,816.39 1.82 32,610.61 4,133.46 1.38 14.54 6.45 50,434.77 4,228.48
Deductions
15.49 0.72 21.85 38.06 92.34
Up to June 30, 2012

118.08 3,326.52 802.71 33,650.08 4,189.67 39.64 507.56 99.20 42,733.46 28,890.54
For the period

7.87 729.23 155.10 6,913.66 741.23 7.61 42.07 15.90 8,612.67 13,875.94
Deductions
3.30 0.33 10.34 13.97 33.02
As at June 30, 2012

3,325.54 589.49 24,317.98 3,549.65 106,660.85 16,071.88 75.87 355.68 133.62 155,080.56
42,733.46
155,080.56
Note 10 : Capital Work-in-Progress and Pre-Operative Expenditure Pending Allocation As at March 31, 2013 A. Capital Work-in-Progress Buildings Railway Siding Plant and Machinery Electrical Installations Land Sub Total Less : Transferred to Fixed Assets Total A B Pre-operative Expenditure Pending Allocation Opening Balance Additions Power and Fuel Salaries, Wages and Bonus Rent and Hire Rates and Taxes Insurance Travelling and Conveyance Telephone and Postage Legal and Professional Charges Miscellaneous Expenses Interest on Term Loans Finance Charges Less : Transferred to Fixed Assets Total B 10,813.57 359.01 25,496.13 3,570.75 6,117.86 46,357.32 39,037.76 7,319.56
(` in lacs) As at June 30, 2012 11,137.77 359.01 27,174.86 3,672.97 5,969.32 48,313.93 2,194.63 46,119.30
12,345.82 352.51 32.63 3.24 0.02 0.32 8.59 0.04 13.93 66.43 288.46 5.89 13,117.88 9,255.94 3,861.94
4,108.91 2,291.90 534.87 132.17 1.27 2.92 92.64 15.76 153.71 154.47 4,971.94 152.85 12,613.41 267.59 12,345.82
54


As at March 31, 2013 C TRIAL RUN EXPENSES Raw Materials Consumed Personnel Cost Salaries, Wages and Bonus Contribution to Provident and Other Funds Manufacturing, Selling and Distribution and Administrative Expenses Consumption of Stores and Spares Labour Charges Power and Fuel Repairs and Maintenance to Others Rent and Hire Other Manufacturing Expenses Legal and Professional Charges Miscellaneous Expenses Interest and Finance Charges Interest on - Others Interest on Term Loans Finance Charges Less: Sales of Finished Goods [Net of Excise duty and cess ` 628.76 lacs (` Nil lacs)] Closing stock at the end of Trial-run period of a project Finished Goods [Net of Excise duty and cess ` 82.51 lacs (` Nil)] Work-in-Process [Net of Excise duty and cess ` Nil (` Nil)] Sub Total Less : Transferred to Fixed Assets Total C Grand Total (A+B+C) 15,075.69 15,075.69 200.18 3.66 203.84 98.57 270.47 320.29 7.14 135.79 4.19 30.00 27.59 894.04
(` in lacs) As at June 30, 2012 ---------------
104.58 1,174.25 62.57 1,341.40 13,881.51
------
1,335.12 428.82
---
15,645.45 1,869.52 1,869.52 -11,181.50
----58,465.12
Consumption of Raw Material : 9 months period ended March 31, 2013 Coking Coal 15,075.69 15,075.69
(` in lacs) 15 months period ended June 30, 2012 ---
55


Note 11 : Non Current Investments Number of shares (Valued at cost unless otherwise stated) Trade Investment Unquoted, Fully Paid up Investment in Equity Shares In Subsidiary Companies Nilachal Iron and Power Limited Jai Balaji Energy (Purulia) Limited Jai Balaji Steels (Purulia) Limited In Joint Venture Companies Andal East Coal Company Private Limited Rohne Coal Company Private Limited Investment in Preference Shares In a Joint Venture Company 1% Redeemable Preference Shares of Rohne Coal Company Private Limited Non Trade Investment Unquoted, Fully Paid up Investment in Equity Shares Calcutta Stock Exchange Limited [At cost less provision for other than temporary diminution ` 100.89 lacs (` 100.89 lacs)] In Government Securities National Saving Certificate (Deposited with Third Parties) Face Value Per Share As at March 31, 2013 (` in lacs) As at June 30, 2012
34,948,727 50,000 50,000 319,290 69,000
10 10 10 10 10
7,709.46 5.00 5.00 134.79 6.90
7,709.46 5.00 5.00 134.79 6.90
1,982,003
10
198.20 8,059.35
198.20 8,059.35
6,726
33.63
33.63
4.12 37.75 8,097.10
2.62 36.25 8,095.60 -8,196.49 100.89 (` in lacs)
Aggregate Value of Investments - Quoted - Unquoted Aggregate provision for diminution in the value of Investments Note 12 : Deferred Tax Assets /(Liabilities) (Net)
-8,197.99 100.89
As at March 31, 2013 Deferred Tax Asset Unabsorbed Depreciation and carry forward Business Losses Expenses Allowed On Payment Basis/Other Timing Differences Sub Total (A) Deferred Tax Liability Timing Difference on Depreciable assets Sub Total (B) Deferred Tax Assets / (Liabilities) (Net) (A-B) 27,176.87 1,380.55 28,557.42 20,101.53 20,101.53 8,455.89
As at June 30, 2012 15,124.67 710.08 15,834.75 17,665.27 17,665.27 (1,830.52)
Although, there is carried forward unabsorbed depreciation as on the reporting date, yet in view of the future profitability projections, the Company is virtually certain that there would be sufficient taxable income in future, to claim the above tax credit.
56


Note 13 : Loans and Advances Non Current As at As at March 31, 2013 June 30, 2012 (Unsecured, Considered Good) Capital Advances Security Deposit [Net of Provision for Doubtful Advances ` 24.28 lacs (` 24.28 lacs)] Loans and advances to Related parties Loans to Body Corporate (Receivable on demand)* Advances to a Subsidiary Company* Advances to a Body Corporate *# Share Application Money to Joint Venture Company Loans to Body Corporate (Receivable on demand) Advances recoverable in cash or kind Advances recoverable in cash or in kind or for value to be received [Net of Provision for Doubtful Advances ` 783.62 lacs (` 783.62 lacs)] Other Loans and advances Balance with Excise and other Government Authorities Advance income tax [net of Provisions ` 5,307.21 lacs (` Nil)] Sales Tax and Other Refunds Receivable Mat Credit Entitlement Total *(Refer Note 32) # since realised Note 14 : Other Non Current Assets As at March 31, 2013 Non Current bank balances (Refer Note 17) Interest Receivable on Deposits Total Note 15 : Inventories Raw Materials [Including in transit ` 5,967.79 lacs (` 5,064.85 lacs)] Stores and Spares [Including in transit ` 185.46 lacs (` 12.88 lacs)] Work - in - Process Finished Goods [including materials lying at port ` 45.04 lacs (` Nil)] By Products and Scrap Total 1,155.76 15.56 1,171.32 5,801.19 713.14 5,738.88 1,281.18 (` in lacs) Current As at As at March 31, 2013 June 30, 2012 -535.30 -213.11
-------
-------
8,500.00 258.16 740.22 193.70 9,692.08 564.05
8,500.00 --122.71 8,622.71 564.05
--
--
6,297.27
4,118.47
--353.47 4,709.71 5,063.18 11,577.51
--366.94 4,709.71 5,076.65 12,096.71
1,204.48 161.98 63.00 -1,429.46 18,518.16
2,051.61 -3.53 -2,055.14 15,573.48
(` in lacs) As at June 30, 2012 107.65 6.76 114.41
44,036.55 4,239.55 793.28 9,753.35 611.97 59,434.70
49,620.94 4,615.19 642.46 23,116.56 2,898.88 80,894.03
57


Note 16 : Trade Receivables As at March 31, 2013 Outstanding for a period exceeding six month from the date they are due for payment Unsecured, considered good Unsecured, considered doubtful Less: Provision for Doubtful Debts (A) Other Debts Unsecured, considered good Total Note 17 : Cash and Bank Balances Non Current As at As at March 31, 2013 June 30, 2012 Cash and Cash equivalents Balance with Banks :On Current Accounts Cash on hand Cheques in hand Unclaimed Dividend Account Unclaimed Fractional Share Balance Other Bank Balances Deposits with original maturity for more than 12 Months* Deposits with original maturity for more than 3 Months but less than 12 months* Amount disclosed under the head Other Non Current Assets (Refer Note 14) Total (B) (A+B) (` in lacs) As at June 30, 2012
15,263.40 270.62 15,534.02 270.62 15,263.40 53,957.21 69,220.61
13,646.85 437.04 14,083.89 437.04 13,646.85 35,038.14 48,684.99
(` in lacs) Current As at As at March 31, 2013 June 30, 2012
-------
-------
310.10 54.60 580.73 2.96 0.16 948.55
113.99 139.65 97.03 4.73 0.16 355. 56
1,155.76 -1,155.76 (1,155.76) --
107.65 -107.65 (107.65) --
204.86 2,803.91 3,008.77 -3,957.32
558.10 1,179.40 1,737.50 -2,093.06
* including ` 4,164.53 lacs ( ` 1,845.15 lacs) pledged with banks and others as margin money against borrowings/other facilities Note 18 : Other Current Assets As at March 31, 2013 Interest Receivable on Loans, Advances and Deposits Subsidies and Incentives Receivable Total 364.53 11,234.90 11,599.43 (` in lacs) As at June 30, 2012 299.27 9,157.94 9,457.21
58


Note 19 : Revenue from Operations 9 months period ended March 31, 2013 Sales of products Finished Goods By Products and Scraps Raw Materials Other Operating Revenue Conversion Charges Subsidy on Sales Tax/Value Added Tax Export Incentives Carbon Credit Income Service and other Charges Revenue from Operations (Gross) Less: Excise Duty Revenue from Operations (Net) Sale of finished goods comprise @ : Sponge Iron Pig Iron Steel Bars/Rods Billet/MS Ingots Ferro Alloys Ductile Iron Pipe Power Coke/Coal Limestone 163,403.96 2,635.73 16.52 1,273.85 2,225.99 16.53 --169,572.58 15,088.83 154,483.75 (` in lacs) 15 months period ended June 30, 2012 300,436.14 5,609.36 2,817.83 3,562.14 1,921.75 240.30 335.78 1,347.92 316,271.22 22,948.10 293,323.12
6,594.29 24,762.93 23,926.58 76,925.90 11,237.35 17,916.09 124.39 1,801.79 114.64 163,403.96
21,923.32 51,353.32 38,835.11 124,315.71 25,203.45 37,360.98 1,317.63 126.62 -300,436.14
@ excludes goods transferred for further processing and used for self consumption in Fixed Assets/Trial Run.
Note 20 : Other Income 9 months period ended March 31, 2013 Interest on : (a) Fixed Deposits with Banks [Gross, Tax deducted at source ` 13.12 lacs ( ` 18.09 lacs)] (b) Loans and Advances [Gross, Tax deducted at source ` 122.96 lacs ( ` 173.44 lacs)] Commission Received Dividend from long term Investments (other than trade) Insurance Claims Liabilities no longer required written back Provision for doubt debts no longer required written back Gain on Foreign Exchange Fluctuations (Net) Miscellaneous Income Total 155.96 1,230.36 34.13 0.67 5.25 233.69 122.04 381.93 9.84 2,173.87
(` in lacs) 15 months period ended June 30, 2012 210.14 1,752.01 130.93 0.47 30.37 425.04 --29.13 2,578.09
59


Note 21 : Cost of Materials Consumed 9 months period ended March 31, 2013 Opening Stock Purchases Less: Closing Stock Raw Materials Consumed Consumption of Raw Material Iron Ore/Pellets Manganese Ore Sponge Iron Billet/Ingot Coke/Coal Magnesium Metal Pig Iron Steel Scrap & Wastes Ferro Alloys Quartzite, Limestone and Dolomite Purchase of Stock in Trade includes Coal DI Fittings 49,620.94 100,625.87 150,246.81 44,036.55 106,210.26 23,556.76 4,862.94 14,573.89 1,551.03 57,733.39 285.51 25.12 532.45 558.99 2,530.18 106,210.26 118.96 36.76 155.72 (` in lacs) 15 months period ended June 30, 2012 41,893.03 242,240.65 284,133.68 49,620.94 234,512.74 61,947.22 13,304.67 26,581.47 9,017.50 116,235.26 580.01 24.56 1,342.15 1,455.87 4,024.03 234,512.74 126.62 -126.62
Note 22 : Changes in Inventories of Finished Goods, Work-in-Progress and Stock-in-Trade 9 months period ended March 31, 2013 Opening Stocks Work-in-Process Finished Goods By Products and Scrap Add: Stock transferred from Trial Run (Refer Note 10) Less: Closing Stocks Work-in-Process Finished Goods By Products and Scrap 642.46 23,116.56 2,898.88 26,657.90 1,763.94 28,421.84
(` in lacs) 15 months period ended June 30, 2012 709.11 7,305.42 2,804.60 10,819.13 -10,819.13
793.28 9,753.35 611.97 11,158.60 17,263.24
642.46 23,116.56 2,898.88 26,657.90 (15,838.77) 2,022.28 (13,816.49)
(Increase)/Decrease in excise duty and cess on stocks Total
(2,178.11) 15,085.13
60


Note 22 : Changes in Inventories of Finished Goods, Work-in-Progress and Stock-in-Trade (Contd.) 9 months period ended March 31, 2013 Stock of finished goods comprises Opening Stock Sponge Iron Pig Iron Steel Bars/Rods Billet/MS Ingots Ferro Alloys Ductile Iron Pipe Total Closing Stock Sponge Iron Pig Iron Steel Bars/Rods Billet/MS Ingot Ferro Alloys Ductile Iron Pipe Coke Total 2,358.85 10,575.45 164.56 8,030.41 382.93 1,604.36 23,116.56 516.72 4,463.22 146.54 2,182.35 529.97 1,004.89 909.66 9,753.35 651.89 273.16 2,129.71 1,899.96 907.49 1,443.21 7,305.42 2,358.85 10,575.45 164.56 8,030.41 382.93 1,604.36 -23,116.56 (` in lacs) 15 months period ended June 30, 2012
Note 23 : Employee Benefits Expense 9 months period ended March 31, 2013 Salaries, Wages, Bonus & Other Benefits Contribution to Provident Fund & other fund Staff Welfare Expenses Directors remuneration Total 4,398.90 355.48 177.22 4.50 4,936.10
(` in lacs) 15 months period ended June 30, 2012 6,727.39 290.53 292.14 -7,310.06
Note 24 : Finance Costs 9 months period ended March 31, 2013 Interest Expenses On Term loans On Income Tax On Others Finance charges Total 11,906.45 -4,234.96 1,503.29 17,644.70
(` in lacs) 15 months period ended June 30, 2012 14,643.48 190.64 14,736.67 2,428.89 31,999.68
61


Note 25 : Other Expenses 9 months period ended March 31, 2013 Consumption of Stores and Spares Labour Charges Power and Fuel Repairs and Maintenance: - Plant and Machinery - Buildings - Others Water Charges Equipment Hire Charges Shifting Expenses Freight and Transportation Rent and Hire Rates and Taxes Insurance Advertisement Brokerage and Commission (Other than Sole Selling Agents) Travelling and Conveyance Telephone and Postage Legal and Professional Charges (Refer Note 39) Directors Fees Provision for Diminution in the Value of Investments Irrecoverable Debts and Advances Written off Less: Adjusted against Provisions Loss on sale of long term non trade Investments Less: Adjusted against Provisions Loss on Foreign Exchange Fluctuations (Net) Charity and Donations Security and Service Charges Loss on Sale of Fixed Assets Miscellaneous Expenses Prior period Expenses Total 10,505.67 4,066.33 13,266.28 403.01 84.58 182.95 284.34 1,540.53 558.44 2,059.27 103.23 827.66 100.21 47.83 169.84 367.94 75.56 261.99 1.45 -82.54 44.38 ----11.73 315.17 2.72 297.02 38.84 35,610.75 38.16 82.83 82.10 150.00 -150.00 912.96 41.36 534.14 12.08 681.58 353.98 60,776.74 (` in lacs) 15 months period ended June 30, 2012 20,402.47 6,429.62 18,651.65 1,016.66 205.10 286.53 472.71 3,038.90 1,537.96 3,392.15 149.88 561.37 171.94 115.24 383.01 568.85 102.69 500.09 2.20 100.89 0.73
62


26. Contingent liabilities not provided for: As at March 31, 2013 a) Claims against the Company not acknowledged as debts i) Excise and Service Tax Demands under dispute/appeal ii) Sales Tax/VAT matters under dispute/appeal b) Letters of Credit, Bills discounted and Bank Guarantees outstanding c) Custom Duty on Import of Equipment and spare parts under EPCG Scheme d) Guarantees and Counter guarantees given by the Company for loans obtained by Subsidiary/other companies e) Guarantee given for Joint Venture Companies 27. Estimated amount of contracts remaining to be executed on Capital Account and not provided for [Net of Advances ` 5,801.19 lacs (` 5,738.88 lacs)] 5,880.10 6,736.99 11,128.48 2,468.83 7,180.00 1,412.46 1,545.89 (` in lacs) As at June 30, 2012 3,536.93 11,552.59 11,533.70 2,266.13 7,780.00 1,412.46 1,498.92
Proportionate amount of pending capital commitments on account of Joint Venture Companies is ` 9.98 lacs [(` 10.52 lacs (March 31, 2012)] as at March 31, 2013. 28 In respect of an electricity supply matter where the Electricity Supplier has demanded enhanced charges, the matter was challenged by the Company at the Appellate Tribunal for Electricity (the tribunal). The Tribunal vide its order dated May 10, 2010 dismissed the appeal of the Supplier and directed to implement the tariff as determined by the Central Electricity Regulatory Commission vide its Order dated August 6, 2009. The Supplier has preferred an appeal with Honble Supreme Court, pending finalisation of the outcome of the matter, the liabilities for the electricity charges are accounted for based on provisional bills provided by the Supplier. 29 On 9th June 2011, the Income Tax Department had carried out Search, Seizure and Survey at the Companys premises. Subsequent to the aforesaid, the Company has admitted no irregularities in the books. However, to buy peace and avoid litigation with the department, surrendered an Income of ` 3,805.50 lacs for the previous year ended 31/3/2011.The Income Tax authorities are yet to complete assessment proceedings in respect of search and seizure operations. 30 During the financial year, the Corporate Debt Restructuring (CDR) Cell through its Empowered Group has approved a debt restructuring scheme for the Company which provides for revision in interest rates, deferment of repayment of term loans, conversion of interest into Funded Interest term loan and additional infusion of ` 5,000.00 lacs into the Company. In view of the above ` 2,509.25 lacs as Money Received against share warrants have been brought up front as stipulated in the restructuring scheme and balance to be brought within a period of one year from the date of Letter of Approval dated 20th September 2012. Necessary adjustments in the books of accounts have been made to reflect the impact of the aforesaid restructuring scheme. 31 During the year, the Company has accounted for the following subsidies/incentives receivable from the Government of West Bengal under West Bengal Incentive Scheme aggregating to ` 2,225.99 lacs (` 1,921.75 lacs): (` in lacs) Sl. No. a) Particulars Industrial Promotion Assistance Account to which credited Subsidy on Sales Tax / Value Added Tax under Sales & Service 9 months period ended March 31, 2013 2,225.99 15 months period ended June, 2012 1,921.75
32. Loans and Advances includes the following balances Name of the Company As at March 31, 2013 Maximum Amount due at any time during 9 months period ended March 31, 2013 As at June 30, 2012
(` in lacs) Maximum Amount due at any time during 15 months period ended June 30, 2012
In terms of Clause 32 of the Listing Agreement Jai Balaji Jyoti Steels Ltd. Subsidiary Company Nilachal Iron and Power Limited 9,240.22 258.16 9,240.22 324.32 8,499.63 (309.04) 12,088.17 2,001.28
63


33 Gratuity The Company has a defined benefit gratuity plan. Every employee who has completed five years or more of service is entitled to gratuity on terms not less favourable than The Provisions of Payment of Gratuity Act, 1972. The scheme is funded with an insurance company in the form of a qualifying insurance policy. The disclosures required under Accounting Standard 15 Employee Benefits notified in the Companies (Accounting Standards) Rules 2006 are given below: I. Expenses recognized in the Statement of Profit & Loss Account are as follows : 9 months period ended March 31, 2013 Current service cost Interest cost on benefit obligation Expected return on plan assets Net actuarial loss/(gain) recognised during the period Past Service cost Total Expenses* * Includes ` Nil (` 31.26 lacs) transferred to Preoperative/Trial Run II. Net Liability/(Assets) recognized in the Balance Sheet are as follows: As at March 31, 2013 Present value of Defined Benefits Obligation Fair value of plan assets Less: Unrecognised past service cost Total Expenses 858.87 330.23 528.64 528.64 (` in lacs) As at June 30, 2012 660.46 310.62 349.84 9.13 340.71 116.05 41.56 (20.89) 57.08 9.13 202.93 (` in lacs) 15 months period ended June 30, 2012 212.11 57.51 (27.59) (158.24) 15.54 99.33
III. Change in the present value of the defined benefit obligation during the period are as follows: As at March 31, 2013 Present Value of Defined Benefit Obligation at the beginning of the period Current Service Cost Interest Cost Benefits Paid Actuarial Loss/(Gain) Plan Amendments Present Value of Defined Benefits Obligation at the period end IV. Change in the Fair Value of Plan Assets during the period ended are as follows: As at March 31, 2013 Fair Value of Plan Assets at the beginning of the year Expected Return Contribution by Employer Benefits paid Actuarial Gains/(Losses) Fair Value of Plan Assets at the period end 310.62 20.89 15.00 (17.14) 0.86 330.23 660.46 116.05 41.56 (17.14) 57.94 -858.87
(` in lacs) As at June 30, 2012 574.74 212.11 57.51 (27.28) (156.62) -660.46 (` in lacs) As at June 30, 2012 209.13 27.59 99.56 (27.28) 1.62 310.62
64


V. The major categories of plan assets as a percentage of the fair value of the total plan assets As at March 31, 2013 Investment with the insurer 100% (` in lacs) As at June 30, 2012 100%
VI. The principal assumptions used in determining gratuity obligations for the Companys plans are shown below. 9 months period ended March 31, 2013 Discount Rate Expected Rate of return on assets Rate of increase in salaries Mortality Table 8.20% 9.00% 10.00% Indian Assured Life Mortality (2006-08) (modified) Ult 15 months period ended June 30, 2012 8.50% 9.00% 10.00% LIC (1994-96) ultimate
VII. Amounts for the current and previous years are as follows: As at March 31, 2013 Defined benefit obligation Plan Assets Surplus/(Deficit) Experience Gain/(Loss) Adjustments on plan liabilities Experience Gain/(Loss) Adjustments on plan assets Experience Gain/(Loss) due to change on assumptions (858.87) 330.23 (528.64) (13.21) 0.86 (44.73) As at June 30, 2012 (660.46) 310.62 (349.84) 129.08 1.62 27.54 As at March 31, 2011 (574.74) 209.13 (365.61) (68.68) (0.99) -As at March 31, 2010 (366.43) 150.13 (216.30) (23.15) (0.14) 24.43
(` in lacs) As at March 31, 2009 (177.65) 84.53 (93.12) Not Available Not Available Not Available
(` in lacs) 9 months period ended March 31, 2013 Contribution to Provident Fund and other Funds Note: i) The Company expects to contribute ` 528.64 lacs (` 340.71 lacs) to Gratuity Fund in 2013-14. 508.59 15 months period ended June 30, 2012 483.98
ii) The estimates of future salary increases, considered in actuarial valuation, take account of inflation, seniority, promotion and other relevant factors, such as supply and demand in the employment market. The above information is certified by the Actuary. iii) The management has relied on the overall actuarial valuation conducted by the actuary.
65


34. Based on the information available with the Company, the amounts due to Micro and Small Enterprises as per MSMED Act, 2006 are as follows : (` in lacs) Sl Particulars No. a) b) c) d) Principal Amount remaining unpaid to the suppliers as at the end of the period Interest due on above remaining unpaid to the suppliers as at the end of the period Amount of interest paid by the buyer in terms of section 16, of the Micro Small and Medium Enterprise Development Act, 2006 Amount of interest due and payable for the period of delay in making payment (which have been paid beyond the appointed day during the year) but without adding the interest specified under Micro Small and Medium Enterprise Development Act, 2006 Amount of interest accrued and remaining unpaid at the end of each accounting year; and Amount of further interest remaining due and payable even in the succeeding years. 9 months period ended March 31, 2013 --------15 months period ended June 30, 2012 ---------
e) f)
-----
-----
35. Excise duty on increase/decrease in stock represents differential excise duty on opening and closing stock of Finished Goods. 36. (i) Unhedged Foreign Currency Exposures outstanding at the year end are as follows : Foreign Currency (FC) Receivables (a) (b) Trade Receivables Advances Total Payables (a) Trade Payables Total Loans (a) Foreign Currency Loans Total (ii) Forward Cover Contracts outstanding at the year end represents the following: Contracts of US $ Nil (US $ 1,650,000) for minimizing the risk of currency exposure on foreign currency loans from banks aggregating ` Nil (` 929.10 lacs). US$ ---12,071,788 6,797.50 6,797.50 US$ Euro 496,368 83,635 269.97 58.16 328.13 27,402,886 241,437 15,430.29 171.2 15.601.49 US$ US$ 78,215 114,654 42.54 62.36 104.9 -68,746 -38.71 38.71 As at March 31, 2013 in FC
` in lacs
As at June 30, 2012 in FC

` in lacs
66


37. Basic and diluted earnings per share : Sl Particulars No. A B C D E F G Profit/(Loss) after Tax Number of shares at the beginning of the year Total equity shares outstanding at the end of the year Weighted average number of equity shares outstanding at the end of the year Nominal Value of each Share Basic Earning per Share Diluted Earning per Share
` in lacs
9 months period ended March 31, 2013 Nos. Nos. Nos.

` ` `
15 months period ended June 30, 2012 (27,605.62) 63,781,486 63,781,486 63,781,486 10.00 (43.28) (43.28)
(21,312.78) 63,781,486 63,781,486 63,781,486 10.00 (33.42) (33.42)
38. Related Party Disclosures a. Name of Related Parties Subsidiary Companies Nilachal Iron & Power Limited (NIPL) Jai Balaji Steels (Purulia) Limited (JBSPL) Jai Balaji Energy (Purulia) Limited (JBEPL) Joint Venture Companies Rohne Coal Company Private Limited (RCCPL) Andal East Coal Company Private Limited (AECCPL) Key Management Personnel Mr. Aditya Jajodia, Chairman and Managing Director Mr. Sanjiv Jajodia, Wholetime Director Relatives of Key Management Personnel Mr. Rajiv Jajodia, Brother of Wholetime Director Mr. Devendra Prasad Jajodia, Brother of Wholetime Director Mr. Aashish Jajodia, Brother of Chairman and Managing Director Mr. Gourav Jajodia, Nephew of Wholetime Director Smt. Kanchan Jajodia, Sister-in-law of Wholetime Director Smt. Rina Jajodia, Sister-in-law of Chairman and Managing Director Smt. Sangeeta Jajodia, Wife of Wholetime Director Smt. Shashi Devi Jajodia, Sister-in-law of Wholetime Director Smt. Seema Jajodia, Wife of Chairman and Managing Director Enterprises owned or significantly influenced by key management personnel or their relatives Chandi Steel Industries Limited (CSIL) Jai Balaji Jyoti Steels Limited (JBJSL) Jai Salasar Balaji Industries Private Limited (JSBIPL) Balaji Ispat Udyog (BIU) Enfield Suppliers Limited (ESL) Hari Management Limited (HML) Jain Vanijya Udyog Limited (JVUL) Jajodia Estate Private Limited (JEPL) K.D. Jajodia Steel Industries Private Limited (KDJSIPL) Shri Marutaye Balaji Steels Limited (SMBSL)
67
68
(` in lacs)
Sales Purchases Rent paid Interest Received -258.16 (309.04) 4,500.00 (4,500.00) Dividend Paid Director free Share Application Advance Guarantees Obtained Investment in Preference Shares Money Received Balance against share Receivable warrants Balance Payable Corporate Guarantee Given -(26.79) 1,631.62 (8,953.17) 898.38 (898.38) 514.08 (514.08) 9,240.22 (8,499.63) (1,229.43) 255,945.00 3,023.57 (4,379.05) 235,910.85 (197,830.17) 235,910.85 (197,830.17) 235,910.85 (197,830.17) 226,150.21 2,680.00 (3,280.00) ----2,235.02 (7,087.92) -(231.19) 2,856.66 (3,724.14) 0.52 (0.86) (10.09) ---(183.18) 1,669.21 (4,599.34) 2,253.03 (14,471.05) 862.83 (1,127.91) 81.92 (133.37) 294.61 (500.87) (12.37) (10.60) (6.27) (0.43) (7.67) ----0.20 (0.35) 0.15 (0.30) --8.99 62.00 (112.00) ----(53.34) -5,091.68 (11,070.04) 5,635.78 (28,340.11) 0.52 (0.86) 1,157.44 (1,628.77) (44.88) (28.18) (10.00) (130.49) ------0.35 (0.65) 70.99 (112.00) -(53.34) 950.00 1,559.25 2,509.25 -12,521.95 (12,878.68) (1,538.47) 1,189,827.76 (593,490.51) 8,592.46 (9,192.46)
b. Related Party Transactions:
Relationship
Party
Subsidiaries
NIPL
Joint Venture
RCCPL
AECCPL
Key Management Personnel
Aditya Jajodia
Sanjiv Jajodia
Relatives of Key Management Personnel
Rajiv Jajodia
Gaurav Jajodia
Others
CSIL
Enterprises owned or significantly influenced by key management personnel or their relatives
JBJSL
JSBIPL
SMBSL
JEPL
ESL
HML
Others
Total


39. Auditors Remuneration (included in Legal and Professional Charges) Payment to Auditor As auditor : Audit fee Limited Review Tax Audit Out-of-pocket expenses In other manner for Certification Total Out of above amount, paid to previous auditor amounts to ` Nil (` 26.60 lacs) 40. Interest in Joint Venture The Company has interest in following Joint Venture Companies which are in the process of setting up coal mining facilities at respective Coal blocks which they have been allotted. Name of the Joint Venture Company Andal East Coal Company Pvt. Ltd. 2012-13 32.79% India 2011-12 32.79% India Rohne Coal Company Pvt. Ltd. 2012-13 6.90% India 2011-12 6.90% India 9 months period ended March 31, 2013 9.50 5.00 1.50 0.54 (` in lacs) 15 months period ended June 30, 2012 6.00 26.50 0.75 0.60
16.54 -16.54
33.85 3.50 37.35
Companys share in Joint Venture Country of Incorporation Proportionate share of the Company in the Joint Venture Companies Current Assets Non Current Assets Current Liabilities Non Current Liabilities Revenue Other Expenses Profit/(Loss) before tax Capital expenditure commitments and contingent liabilities of the joint venture are disclosed in Note 26
48.54 541.54 97.76 1.45 -2.04 (2.04)
64.12 500.39 115.69 0.50 -0.83 (0.83)
0.54 279.20 0.08 -0.14 0.11 0.03
0.56 243.47 0.08 -0.12 0.12 0.00
41. Details of the Equity Shares pledged by the promoter or persons forming part of the promoter group (Promoter Group) of the Company as on the balance sheet date: As at March 31, 2013 Total Number of Equity shares held by the promoter group Total Number of Equity shares pledged by the promoter group Percentage of total shares pledged to total shareholding of the promoter group Percentage of total shares pledged to total outstanding shares of the Company 33,220,395 30,782,233 92.66% 48.26% As at June 30, 2012 32,736,884 30,782,233 94.03% 48.26%
42. Value of Consumption of Imported and Indigenous raw materials and components, spare parts etc. Consumption Raw Materials*
` in lacs
Components, Spare Parts etc*

` in lacs
% of toal Consumption 23.25 (11.61) 76.75 (88.39) 100.00 (100.00)
% of toal Consumption 7.12 (11.76) 92.88 (88.24) 100.00 (100.00)
Imported Indigenous Total *includes materials consumed during trial run process
28,204.05 (27,231.55) 93,081.90 (207,281.19) 121,285.95 (234,512.74)
754.98 (2,399.33) 9,849.26 (18,003.14) 10,604.24 (20,402.47)
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43. Value of Imports (calculated on CIF basis) 9 months period ended March 31, 2013 Raw materials Components & Spare Parts Capital Goods Total 44. Expenditure in Foreign Currency (on accrual basis) 9 months period ended March 31, 2013 Professional Consultation Fees Interest Others Total* *includes amount transferred to Preoperative and Trial Run Expenses 45. Earnings in Foreign Currency (on accrual basis) 9 months period ended March 31, 2013 Exports at FOB Value 46. Amount remitted in foreign currency on account of dividends : 9 months period ended March 31, 2013 i) ii) iii) iv) Financial Year to which the dividend relates No. of non-resident shareholders No. of Shares held Amount remitted as dividend (` in lacs)* 2011-12 134 1,18,15,543 Nil 688.18 (` in lacs) 15 months period ended June 30, 2012 4,540.75 (` in lacs) 15 months period ended June 30, 2012 2010-11 143 17,176,309 Nil 37.03 112.61 22.91 172.55 21,820.11 754.98 -22,575.09 (` in lacs) 15 months period ended June 30, 2012 29,253.01 2,159.86 2,094.12 33,506.99 (` in lacs) 15 months period ended June 30, 2012 116.87 291.07 155.04 562.98
*Excludes dividend paid to non-resident shareholders in Indian Rupees aggregating to ` Nil ( ` 68.71 lacs) 47. i) The current financial year of the Company is for the period of nine months from 1st July, 2012 to 31st March, 2013 as compared to previous financial year of fifteen months from 1st April, 2011 to 30th June, 2012. Hence, the current periods figures are not comparable with previous periods figures. ii) Figures in brackets represent previous financial years figures, which have been rearranged/regrouped wherever necessary to conform to this years classification. As per our report of even date For U. Narain & Co. Chartered Accountants Firm Regn. No. 000935C CA R. R. Modi Partner Membership No. : 053118 Place : Kolkata Date : May 15, 2013 For Rashmi & Co. Chartered Accountants Firm Regn. No. 309122E CA Sandeep Agarwal Partner Membership No. : 065643 For and on behalf of the Board of Directors Aditya Jajodia Chairman & Managing Director Rajiv Jajodia Director Sanjiv Jajodia Wholetime Director Raj Kumar Sharma Chief Financial Officer
70

Section 212
Statement pursuant to Section 212 of the Companies Act, 1956, relating to the Subsidiary Companies : 1. Name of the Subsidiaries : Nilachal Iron & Power Limited Jai Balaji Steels (Purulia) Limited 31st March, 2013 50,000 Equity Shares of ` 10 each fully paid up 100% Jai Balaji Energy (Purulia) Limited 31st March, 2013 50,000 Equity Shares of ` 10 each fully paid up 100%
2. The financial year of the Subsidiary Companies ended on : 31st March, 2013 3. a. Number of Shares held by Jai Balaji Industries Limited in the Subsidiary at the end of the Financial year of the Subsidiary Companies b. Extent of interest of Holding Company at the end of the Financial year of Subsidiary Company 4. The net aggregate amount of the Subsidiary Company profit/(loss) so far as it concerns the Members of the Holding Company a) Not dealt with in the Holding Companys Accounts i) For the Financial year ended 31st March, 2013 ii) For the previous Financial year of the Subsidiary Company since it became the Holding Companys Subsidiary b) Dealt with in the Holding Companys account i) For the Financial year ended 31st March, 2013 ii) For the previous Financial year of the Subsidiary Company since it became the Holding Companys Subsidiary : NIL : ` (94.64) Lacs : ` (1,677.72) Lacs : 34,948,727 Equity Shares of ` 10 each fully paid up : 100%
N.A.
N.A.
: ` (1,161.00) Lacs
N.A.
N.A.
N.A. N.A.
N.A. N.A.
For and on behalf of the Board of Directors Aditya Jajodia Chairman & Managing Director Place : Kolkata Date : 12th August, 2013 Sanjiv Jajodia Wholetime Director Raj Kumar Sharma Chief Financial Officer Rajiv Jajodia Director Ajay Kumar Tantia Company Secretary
71
Jai Balaji Industries Limited and its Subsidiary

Independent Auditors Report

To the Members of Jai Balaji Industries Limited REPORT ON THE CONSOLIDATED FINANCIAL STATEMENTS We have audited the accompanying Consolidated financial statements of Jai Balaji Industries Limited (the Company), and its subsidiaries (collectively reffered to as The Group) which comprise the Consolidated Balance Sheet as at March 31, 2013, and the Consolidated Statement of Profit and Loss for the period (1st July, 2012 to 31st March, 2013) and the Consolidated Cash Flow Statement for the period then ended, and a summary of significant accounting policies and other explanatory information. MANAGEMENTS RESPONSIBILITY FOR THE CONSOLIDATED FINANCIAL STATEMENT Management is responsible for the preparation of these financial statements that give a true and fair view of the consolidated financial position, consolidated financial performance and consolidated cash flows of the Group in accordance with the Accounting Principles generally accepted in India including Accounting Standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956 (the Act). This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material For U. Narain & Co. Chartered Accountants Firm Regn. No. 000935C CA R. R. Modi Partner Membership No. : 053118 27, Brabourne Road, Narayani Building 5th Floor, Room No. 503 Phone: 033 3053 3386 (5 lines) Email: unaraincokol@gmail.com Dated: 15th May, 2013
misstatement, whether due to fraud or error. AUDITORS RESPONSIBILITY Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with the Standards on Auditing issued by the Institute of Chartered Accountants of India. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the Consolidated financial statements. The procedures selected depend on the auditors judgment, including the assessment of the risks of material misstatement of the Consolidated financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the Groups preparation and fair presentation of the Consolidated financial statements in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by management, as well as evaluating the overall presentation of the Consolidated financial statements. OPINION Based on our audit and consideration of the reports of other auditors on
separate financial statements and on other financial information of the components, and to the best of information and explanation given to us, we are of the opinion that the attached consolidated financial statements 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 Group as at March 31, 2013. b) in the case of Consolidated Statement of Profit and Loss, of the Loss of the Group for the period ended on that date. c) in the case of Consolidated Cash Flow Statement, of the cash flows of the Group for the period ended on that date. OTHER MATTERS Financial statements of two of the subsidiaries for the period from July 1, 2012 to March 31, 2013 which reflect total asset of ` 10.24 lakhs and cash outflow of ` 0.37 lakhs have been audited by one of us. We did not audit the financial statement of subsidiaries for the period from July 1, 2012 to March 31, 2013 and Joint Venture Companies for the period from April 1, 2012 to March 31, 2013, whose financial statement reflect total asset of ` 25,530.97 lakhs as at March 31, 2013 total revenue (Net) of ` 1,641.85 lakhs and net cash outflow amounting to ` 23.36 lakhs for the peiod ended on that date. These financial statements has been audited by other auditors whose reports has been furnished to us and our opinion, is based solely on the reports of other auditors. For Rashmi & Co. Chartered Accountants Firm Regn. No. 309122E CA Sandeep Agarwal Partner Membership No. : 065643 213, Todi Chambers 2, Lal Bazaar Chambers Phone: 033 2230 2329 Email: rashmico@icai.org Dated: 15th May, 2013
72

Consolidated Balance Sheet as at March 31, 2013

Notes EQUITY AND LIABILITIES Shareholders Fund Share Capital Reserves and Surplus Money Received against share warrants Share Application Money pending allotment Non Current Liabilities Long Term Borrowings Deferred Tax Liabilities (Net) Long Term Provisions Current Liabilities Short Term Borrowings Trade Payables Other Current Liabilities Short Term Provisions TOTAL ASSETS Non Current Assets Fixed Assets Tangible Assets Capital Work in Progress and Pre-Operative Expenditure Pending Allocation Non Current Investments Deferred Tax Assets (Net) Long Term Loans and Advances Other Non Current Assets Current Assets Current Investments Inventories Trade Receivables Cash and Bank Balances Short Term Loans and Advances Other Current Assets TOTAL Significant Accounting Policies 2 As at March 31, 2013
3 4
6,377.76 43,971.39 2,509.25 52,858.40 240.16 175,905.98 -10.15 175,916.13 56,063.89 95,257.18 30,788.02 659.09 182,768.18 411,782.87
6,377.11 66,323.59 -72,700.70 230.86 52,820.87 2,463.11 10.22 55,294.20 119,672.93 80,432.19 75,424.20 455.85 275,985.17 404,210.93
5 12 6
7 8 8 6
9 10 11 12 13 14
209,351.32 13,309.79 64.61 8,612.58 12,060.26 1,175.72 244,574.28 0.34 62,453.53 70,204.07 4,218.35 18,732.87 11,599.43 167,208.59 411,782.87
168,112.17 60,477.72 63.11 -12,583.27 118.81 241,355.08 0.41 84,588.76 49,849.10 2,357.04 16,250.88 9,809.66 162,855.85 404,210.93
15 16 17 18 13 19
The accompanying notes are an integral part of the consolidated financial statements As per our report of even date For U. Narain & Co. Chartered Accountants Firm Regn. No. 000935C CA R. R. Modi Partner Membership No. : 053118 Place : Kolkata Date : May 15, 2013 For Rashmi & Co. Chartered Accountants Firm Regn. No. 309122E CA Sandeep Agarwal Partner Membership No. : 065643 For and on behalf of the Board of Directors Aditya Jajodia Chairman & Managing Director Rajiv Jajodia Director Sanjiv Jajodia Wholetime Director Raj Kumar Sharma Chief Financial Officer
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Consolidated Statement of Profit and Loss for 9 months period ended March 31, 2013
Notes 9 months period ended March 31, 2013 169,572.58 15,088.83 154,483.75 2,228.23 156,711.98
(` in lacs) 15 months period ended June 30, 2012 318,615.19 23,032.04 295,583.15 2,626.37 298,209.52
INCOME Revenue from Operations (Gross) Less: Excise Duty Revenue from Operations (Net) Other Income Total Revenue (I) EXPENSES Cost of Materials Consumed Purchase of Stock in Trade Changes in Inventories of Finished Goods, Work-in-Progress and Stock-in-Trade Employee Benefits Expense Finance Costs Depreciation and Amortisation Expense Other Expenses Total Expenses (II) Profit / (Loss) before Tax (I-II) Tax Expenses: Current Tax Expenses [Including ` 1.47 lacs (` Nil) for earlier Year] Deferred Tax Charge / (Credit) Total Tax Expense Profit/(Loss) for the period Earnings per Equity Share: (Nominal Value per Share ` 10) Basic & Diluted Significant Accounting Policies
20 20 21
22 22 23 24 25 9 26
105,719.53 155.72 15,293.65 5,267.41 18,510.49 9,184.92 36,006.65 190,138.37 (33,426.39)
233,398.15 126.62 (12,990.11) 7,836.66 32,663.11 14,371.34 62,325.13 337,730.90 (39,521.38)
1.47 (11,075.69) (11,074.22) (22,352.17) 38 2 (35.04)
2.51 (11,259.43) (11,256.92) (28,264.46) (44.31)
The accompanying notes are an integral part of the consolidated financial statements
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Consolidated Cash Flow Statement for 9 months period ended March 31, 2013
(` in lacs) 9 months period ended March 31, 2013 A: CASH FLOW FROM OPERATING ACTIVITIES Net Profit / (Loss) Before Taxes Adjustments For : Depreciation /Amortisation (Net) Loss on Sale of Fixed Assets Irrecoverable Debts and Advances Written off Liabilities no longer required written back Interest on Term Loans and Others Provision for Diminution in the value of Investments Provision for doubtful debts no longer required written back Dividend from long term Non Trade Investments Dividend from Current Investments (other than trade) Loss on sale of long term Non Trade Investments Prior Period Expenditure (net) (Profit) /Loss on Foreign Exchange Fluctuations (Net) Interest Income Operating Profit / (Loss) Before Working Capital Changes Movements in Working Capital : Decrease / (Increase) in Trade Receivables Increase in Loans and Advances and Other Current / Non Current Assets Decrease / (Increase) in Inventories Decrease in Trade Payables, Other Liabilities and Provisions Cash generated from / (used in ) Operating Activities Direct Taxes paid ( net of refunds) Net Cash generated from / (used in) Operating Activities B: CASH FLOW FROM INVESTING ACTIVITIES Purchase of Fixed Assets Proceeds from Sale of Fixed Assets Purchase of Investments in Mutual Fund Purchase of Investments in Government Securities Proceeds from sale of long term Investments (other than trade) Proceeds from sale of current Investments (other than trade) Proceeds from maturity of fixed deposits Dividend from long term Investments (other than Trade) Dividend from Current Investments (other than trade) Loan to Related Party Interest received Net Cash Used In Investing Activities (33,426.39) 9,184.92 2.72 47.36 (234.14) 18,559.23 -(122.04) (0.67) (0.14) -65.67 (381.93) (1,417.59) (7,722.99) (24,779.53) (1,096.55) 22,135.23 8,149.69 (3,314.16) (173.61) (3,487.77) 15 months period ended June 30, 2012 (39,521.38) 14,371.34 12.08 681.54 (449.94) 30,189.43 100.89 -(0.47) (0.12) 150.00 365.14 912.96 (1,984.98) 4,826.49 5,701.99 (5,253.53) (22,091.36) 49,688.66 32,872.25 (1,595.43) 31,276.82
(3,562.33) 21.37 -(1.50) -0.07 -0.67 0.14 -1,343.53 (2,198.05)
(21,562.99) 47.24 0.78 (2.00) 50.00 -81.25 0.47 0.12 (5,000.00) 1,843.97 (24,541.16)
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Consolidated Cash Flow Statement (Contd.)

(` in lacs) 9 months period ended March 31, 2013 C: CASH FLOW FROM FINANCING ACTIVITIES Proceeds from Call in Arrears of equity share capital Proceeds from Share Application Money Money Received against share warrants Proceeds from long / short term Borrowings Repayment of long / short term Borrowings Interest Paid (including interest capitalised) Dividend Paid Tax on Dividend paid Net Cash generated from Financing Activities Net Increase / (Decrease) In Cash and Cash Equivalents (A+B+C) Cash and Cash Equivalents as at the beginning of the year Cash and Cash Equivalents as at the end of the year Components of Cash and Cash Equivalents Cash on hand Cheques in hand Balance with Scheduled Banks on: Current Account Fixed Deposit Account Unclaimed Dividend Account * Unclaimed Fractional Share Balance* Cash and Bank Balances as per Note 18 Less : Fixed deposits not considered as cash equivalents Cash and Cash Equivalents in Cash Flow Statement 336.58 4,357.03 2.96 0.16 5,374.11 4,164.53 1,209.58 141.13 2,070.73 4.73 0.16 2,464.69 2,070.73 393.96 96.65 580.73 150.84 97.10 0.65 9.29 2,509.25 12,385.10 (3,441.01) (5,173.03) (1.77) -6,288.48 602.66 606.93 1,209.58 -215.77 -57,054.08 (35,464.26) (29,850.39) (255.65) (41.40) (8,341.85) (1,606.19) 2,000.15 393.96 15 months period ended June 30, 2012
* These balances are not available for use by the Company as they represent corresponding unpaid dividend and unclaimed fractional share balances.
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Notes to Consolidated Financial Statements for the period ended March 31, 2013
1. PRINCIPLES OF CONSOLIDATION: a) The Consolidated Financial Statements which relate to Jai Balaji Industries Limited ("the Company") and its subsidiaries and joint ventures (collectively referred as "the Group"), have been prepared on the following basis : b) The Subsidiary Companies considered in the Financial Statements are as follows : Proportion of Ownership / Interest As at March 31, 2013 100% 100% 100% As at June 30, 2012 100% 100% 100%
Name of the Subsidiary Nilachal Iron & Power Limited (NIPL) Jai Balaji Steels (Purulia) Limited Jai Balaji Energy (Purulia) Limited
Country of Incorporation India India India
c) In terms of Accounting Standard 21 Consolidated Financial Statements issued by the Institute of Chartered Accountants of India, the financial statements of the Company and its Subsidiary are combined
on a line-by-line basis by adding together the book values of like items of assets, liabilities, income and expenditure, after fully eliminating intragroup balances, intra-group transactions and any unrealised profit/loss included therein. d) The difference of the cost to the
Company of its investment in Subsidiary as at the date of acquisition of stake is recognized in the financial statements as Goodwill or Capital Reserve, as the case may be. Any such difference arising subsequently is adjusted against Statement of Profit and Loss.
e) The Joint Venture Companies considered in the financial statements are as follows : Name of the Joint Venture Company Rohne Coal Company Private Ltd. Andal East Coal Company Private Ltd. (f) In terms of Accounting Standard 27 Financial Reporting of Interests in Joint Venture issued by the Institute of Chartered Accountants of India, the Company has prepared these consolidated financial statements by including the Companys proportionate interest in the Joint Ventures assets, liabilities, income and expenditure etc in the Country of Incorporation India India Proportion of Ownership / Interest As at March 31, 2013 6.90% 32.79% As at June 30, 2012 6.90% 32.79%
consolidated financial statements in respective line items. (g) The consolidated financial statements have been prepared using uniform accounting policies for like transactions and are presented, to the extent possible, in the same manner as the Companys separate financial statements.
(h) The financial statements of the entities used for the purpose of consolidation are drawn up for the same reporting period i.e nine months period ending 31st March, 2013 except for Joint Venture Companies, Rohne Coal Company Private Ltd. and Andal East Coal Company Private Ltd., whose financial statements are for the twelve months period ended 31st March, 2013.
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Notes to Consolidated Financial Statements (Contd.)

2 Summary of Significant Accounting Policies (a) Basis of preparation The consolidated financial statements of the Group have been prepared in accordance with generally accepted accounting principles in India. The Group has prepared these financial statements to comply in all material respects with the accounting standards notified by the Companies (Accounting Standards) Rules, 2006, to the extent applicable (as amended) and the relevant provisions of the Companies Act, 1956. The financial statements have been prepared under the historical cost convention on an accrual basis. The accounting policies have been consistently applied by the Group and except for the changes discussed more fully below, are consistent with those used in the previous year. (b) Use of estimates The preparation of financial statements in conformity with generally accepted accounting principles requires the management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at the date of the financial statements and the results of operations during the reporting period end. Although these estimates are based upon the managements best knowledge of current events and actions, actual results could differ from these estimates. (c) Tangible Fixed Assets Fixed assets are stated at cost less accumulated depreciation and impairment losses if any. Cost comprises the purchase price inclusive of duties (net of CENVAT and VAT Credit), taxes, incidental expenses, erection/commissioning expenses and interest etc., upto the date the asset is ready to be put to use. Own produced materials used for fixed assets are capitalised at cost. Machinery spares which can be used only in connection with a particular item of fixed asset and whose use as per technical assessment is expected to be irregular, are capitalised and depreciated prospectively over the residual life of the respective asset. (d) Depreciation i) T h e c l a s s i f i c a t i o n o f Plant and Machinery into continuous and noncontinuous process is done as per technical certification and depreciation thereon is provided accordingly. ii) Depreciation is provided using the Straight Line Method as per the useful lives of the assets estimated by the management which is equal to the rates prescribed under schedule XIV of the Companies Act, 1956 except for Railway Wagons and Moulds as stated below. iii) Depreciation on Railway Wagons acquired by the Company is provided @ 10% p.a. as against 4.75% p.a. as prescribed in Schedule XIV because of the conditions prescribed in the agreement with Indian Railway Authorities. iv) Pipe Moulds for Ductile Iron Foundry Works are depreciated over a period of 4 years. v) In case of impairment, if any, depreciation is provided on the revised carrying amount of the assets over their remaining useful life. (e) Borrowing Costs Borrowing costs relating to acquisition / construction of qualifying assets are capitalized until the time all substantial activities necessary to prepare the qualifying assets for their intended use are complete. A qualifying asset is one that necessarily takes substantial period of time to get ready for its intended use. All other borrowing costs are charged to revenue. (f) Impairment The carrying amounts of assets are reviewed at each balance sheet date if there is any indication of impairment based on internal/external factors. An impairment loss is recognized wherever the carrying amount of an asset exceeds its recoverable amount. The recoverable amount is the greater of the assets net selling price and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and risks specific to the asset. After impairment, depreciation is provided on the revised carrying amount of the asset over its remaining useful life. (g) T a n g i b l e F i x e d A s s e t s acquired under Finance Lease Assets acquired under lease agreements which effectively transfer to the Company substantially all the risks and benefits incidental to ownership of the leased item, are capitalized at the lower of the fair value and present value of the minimum lease
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payments at the inception of the lease term and disclosed as leased assets. Lease payments are apportioned between the finance charges and reduction of the lease liability based on the implicit rate of return. Finance charges are charged directly to expense. If there is no reasonable certainty that the Company will obtain the ownership by the end of the lease term, capitalized leased assets are depreciated over the shorter of the estimated useful life of the asset or the lease term. (h) Government grants and subsidies Grants and subsidies from the (j) Inventories Inventories are valued as follows: Raw materials At lower of cost and net realizable value. However, materials and other items held for use in the production of inventories are not written down below cost if the finished products in which they will be incorporated are expected to be sold at or above cost. Cost is determined on a weighted average basis. At lower of cost and net realizable value. Cost is determined on First in First Out basis except for Durg unit where the cost is determined on weighted average basis. At lower of cost and net realizable value. Cost includes direct materials and labour and a proportion of manufacturing overheads based on normal operating capacity. Cost of finished goods includes excise duty. Cost is determined on a weighted average basis. government are recognized when there is a reasonable assurance that the grant/subsidy will be received and all attaching conditions will be complied with. When the grant or subsidy relates to an expense item, it is recognized as income over the periods necessary to match them on a systematic basis to the costs, which it is intended to compensate. Where the grant or subsidy relates to an asset, its value is deducted in arriving at the carrying amount of the related asset. Government grants of the nature of promoters contribution are credited to capital reserve and treated as a part of shareholders funds. (i) Investments Investments that are readily realisable and intended to be held for not more than a year are classified as current investments. All other investments are classified as long-term investments. Current investments are carried at lower of cost and fair value determined on an individual investment basis. Long-term investments are carried at cost. However, provision for diminution in value is made to recognize a decline other than temporary in the value of theinvestments.
Stores and Spares Work-in- Process and Finished Goods
Scrap and By Products At net realizable value. Net realizable value is the estimated selling price in the ordinary course of business, less estimated costs of completion and estimated costs necessary to make the sale. (k) Revenue Recognition Revenue is recognized to the extent that it is probable that the economic benefits will flow to the Group and the revenue can be reliably measured. Sale of Goods Revenue from sale of goods is recognized on passage of title thereof to the customers, which generally coincides with delivery. Further, sales are inclusive of excise duty and are net of returns, claims, rebates, discounts, Sales Tax, VAT etc. Income from Services Income from Services is recognized on performance of the contract and acceptance of the services by the customers. Interest Revenue is recognised on a time proportion basis taking into account the amount outstanding and the rate applicable. Dividend Dividend income is recognized when the shareholders right to receive payment is established by the balance sheet date. (l) Foreign currency transactions (i) Initial Recognition Foreign currency transactions are recorded in the reporting currency, by applying to the foreign currency amount the exchange rate between the reporting currency
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and the foreign currency at the date of the transaction. (ii) Conversion Foreign currency monetary items are reported using the closing rate. Non-monetary items which are carried in terms of historical cost denominated in a foreign currency are reported using the exchange rate at the date of the transaction; and nonmonetary items which are carried at fair value or other similar valuation denominated in a foreign currency are reported using the exchange rates that existed when the values were determined. (iii) Exchange Differences Exchange differences arising on the settlement / conversion of monetary items are recognized as income or as expenses in the period in which they arise. (iv) F o r w a r d E x c h a n g e Contracts not intended for trading or speculation purposes The premium or discount arising at the inception of forward exchange contracts is amortised as expense or income over the life of the contract. Exchange differences on such contracts are recognised in the statement of profit and loss in the year in which the exchange rates change. Any profit or loss arising on cancellation or renewal of forward exchange contract is recognised as income or as expense for the year. (m) Retirement and other employee benefits i. Retirement benefit in the form of Provident Fund is a defined contribution scheme and the contribution is charged to statement of profit and loss of the year when the contributions to the respective fund is due. There is no other obligation other than the contribution payable to provident fund. ii. Gratuity liability is a defined benefit obligation and is provided for on the basis of actuarial valuation on projected unit credit method made at the end of each financial year. Unrecognised past service cost arising at the time of change in plan measures are charged to statement of profit and loss on a straight line basis over the period of vesting of the defined benefit obligation. iii. Short term compensated absences are provided for based on estimates whereas long term compensated absences are provided for on the basis of actuarial valuation, as per projected unit credit method. iv. Actuarial gains / losses are immediately taken to statement of profit and loss and are not deferred. (n) Taxation Tax expense comprises of current and deferred tax. Current income tax is measured at the amount expected to be paid to the tax authorities in accordance with the Income Tax Act, 1961 enacted in India. Deferred income taxes reflect the impact of current year timing differences between taxable income and accounting income for the year and reversal of timing differences of earlier years. Deferred tax is measured based on the tax rates and the tax laws enacted or substantially enacted at the Balance Sheet date. Deferred tax assets and deferred tax liabilities are offset, if a legally enforceable right exists to set off current tax assets against current tax liabilities and the deferred tax assets and deferred tax liabilities relate to the taxes on income levied by same governing taxation laws. Deferred tax assets are recognized only to the extent that there is reasonable certainty that sufficient future taxable income will be available against which such deferred tax assets can be realized. In situations where the Company has unabsorbed depreciation or carry forward tax losses, deferred tax assets are recognized only if there is virtual certainty supported by convincing evidence that they can be realized against future taxable profits. At each balance sheet date the Company re-assesses unrecognized deferred tax assets. It recognizes unrecognized deferred tax assets to the extent that it has become reasonably certain or virtually certain, as the case may be that sufficient future taxable income will be available against which such deferred tax assets can be realised. The carrying amount of deferred tax assets are reviewed at each balance sheet date. The Company writesdown the carrying amount of a deferred tax asset to the extent that it is no longer reasonably certain or virtually certain, as the case may be, that sufficient future taxable income will be available against which deferred tax asset can be realised. Any such write-down is reversed to the extent that it becomes
80


reasonably certain or virtually certain, as the case may be, that sufficient future taxable income will be available. Minimum Alternate Tax (MAT) credit is recognised as an asset only when and to the extent there is convincing evidence that the Company will pay normal income tax during the specified period. In the year in which the MAT credit becomes eligible to be recognized as an asset in accordance with the recommendations contained in Guidance Note issued by the Institute of Chartered Accountants of India, the said asset is created by way of a credit to the statement of profit and loss and shown as MAT Credit Entitlement. The Company reviews the same at each Balance Sheet date and writes down the carrying amount of MAT Credit Entitlement to the extent there is no longer convincing evidence to the effect that the Company will pay normal Income Tax during the specified period. (o) Expenditure on new projects and substantial expansion Expenditure directly relating to construction activity are capitalised. Indirect expenditure incurred during construction period are capitalised as part of the indirect construction cost to the extent to which the expenditure are indirectly related to construction or are incidental thereto. Other indirect expenditure (including borrowing costs) incurred during the construction period which are not related to the construction activity nor are incidental thereto are charged to the statement of profit and loss. Income earned during construction period is deducted from the total of the indirect expenditure. All direct capital expenditure on expansion are capitalised. As regards indirect expenditure on expansion, only that portion is capitalised which represents the marginal increase in such expenditure involved as a result of capital expansion. Both direct and indirect expenditure are capitalised only if they increase the value of the asset beyond its original standard of performance. (p) Segment Reporting Policies Based on the synergies, risks and returns associated with business operations and in terms of Accounting Standard-17, the Company is predominantly engaged in a single reportable segment of Iron and Steel during the year. The risks and returns of existing captive power plants are directly associated with the manufacturing operations of Iron and Steel and hence treated as a single reportable segment as per Accounting Standard-17. The Company at present primarily operates in India and therefore the analysis of geographical segments is not applicable to the Company. (q) Earnings Per Share Basic earning per share is calculated by dividing the net profit or loss for the year attributable to equity shareholders by the weighted average number of equity shares outstanding during the year. Partly paid equity shares / instruments are treated as a fraction of an equity share to the extent that they were entitled to participate in dividends relative to a fully paid equity share during the reporting year. For the purpose of calculating diluted earnings per share, the net profit or loss for the year attributable to equity shareholders and the weighted average number of shares outstanding during the year are adjusted for the effects of all dilutive potential equity shares. (r) Provisions A provision is recognised when an enterprise has a present obligation as a result of past event and it is probable that an outflow of resources will be required to settle the obligation, in respect of which a reliable estimate can be made. Provisions are not discounted to their present value and are determined based on best estimates required to settle the obligation at the balance sheet date. These are reviewed at each Balance Sheet date and adjusted to reflect the current best estimates. (s) Cash and Cash Equivalents Cash and cash equivalents as indicated in the Cash Flow Statement comprise cash at bank and on hand and shortterm investments with an original maturity of three months or less. (t) Contingent Liabilities Contingent liabilities are not provided for in the accounts and are separately disclosed in the Financial statements. (u) Basis of classification of Current and Non Current Assets and Liabilities in the balance sheet have been classified as either current or non-current based upon the requirements of Revised Schedule VI notified under the Companies Act 1956. An asset has been classified as current if (a) it is expected to be realized in, or is intended
81


for sale or consumption in, the Companys normal operating cycle; or (b) it is held primarily for the purpose of being traded; or (c) it is expected to be realized within twelve months after the reporting date; or (d) it is cash or cash equivalent unless it is restricted from being exchanged or used to settle a liability for at least twelve Note 3 : Share Capital As at March 31, 2013 Authorised capital 101,000,000 (101,000,000) Equity Shares of ` 10/- each Issued, subscribed and fully paid-up capital 63,781,486 (63,781,486) Equity Shares of ` 10/- each Less: Calls unpaid (Due from other than directors or officers) Total 10,100.00 6,378.15 0.39 6,377.76 months after the reporting date. All other assets have been classified as non-current. A Liability has been classified as current when (a) it is expected to be settled in the Companys normal operating cycle; or (b) it is held primarily for the purpose of being traded; or (c) it is due to be settled within twelve months after the reporting date; or (d) the Company does not have an unconditional right to defer settlement of the liability for at least twelve months after the reporting date. An operating cycle is the time between the acquisition of assets for processing and their realization in cash or cash equivalents. (` in lacs) As at June 30, 2012 10,100.00 6,378.15 1.04 6,377.11
(a) Reconciliation of the shares outstanding at the beginning and at the end of the reporting period : As at March 31, 2013 No. of Shares (` in lacs) Equity Shares of ` 10/- each At the beginning of the period Call money received during the period At the end of the period 63,781,486 -63,781,486 6,377.11 0.65 6,377.76 As at June 30, 2012 No. of Shares (` in lacs) 63,781,486 -63,781,486 6,377.11 -6,377.11
(b) Terms/rights attached to equity shares The Company has only one class of ordinary shares (equity shares) having at par value of ` 10/- each. Each shareholder of ordinary shares (equity shareholders) is entitled to one vote per share. The Company declares and pays dividend in Indian Rupees. The dividend proposed by the Board of Directors is subject to approval of the shareholders in the ensuing annual general meeting except in the case of interim dividend. In the event of liquidation, the equity shareholders are eligible to receive the remaining assets of the Company after distributions of all preferential amounts, in the proportions to their share holdings. (c) Details of shareholders holding more than 5% shares in the Company As at March 31, 2013 No. of Shares % holding in the class Enfield Suppliers Ltd. Hari Management Ltd. CVCIGP II Client Rosehill Limited Aditya Jajodia 11,221,233 7,044,533 3,886,734 3,674,576 25,827,076 17.59 11.04 6.09 5.76 40.48 As at June 30, 2012 No. of Shares % holding in the class 11,221,233 7,044,533 3,886,734 3,203,065 25,355,565 17.59 11.04 6.09 5.02 39.74
As per records of the Company, including its register of shareholders/members, the above share holdings represents legal ownership of shares.
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(d) Aggregate number of shares issued for consideration other than cash during the period of five years immediately preceding the reporting date As at March 31, 2013 No. of Shares Equity Shares allotted as fully paid up for consideration other than cash Note 4 : Reserves & Surplus As at March 31, 2013 Capital Reserve As per last Financial Statements Amalgamation Reserve As per last Financial Statements Securities Premium Account As per last Financial Statements General Reserve As per last Financial Statements Surplus/(Deficit) in Statement of Profit & Loss As per last financial statements Add: Profit/(Loss) for the period Surplus/ (Deficit) in Statement of Profit & Loss Total Note 5 : Long Term Borrowings Non Current Portion As at March 31, 2013 (Secured, unless otherwise stated) Term Loans Rupee Loan from banks Rupee Loan from Financial Institutions Rupee Loan from Financial Institution (Unsecured) Rupee Loan from Others Foreign Currency Loan from banks Deferred Payments Liabilities Other Loan and Advances Interest Free Sales Tax Loan (Unsecured) Total Amount disclosed under the head Other Current Liabilities (Refer Note 8) Total As at June 30, 2012 Current Portion As at March 31, 2013 As at June 30, 2012 8,943.21 4,400.00 46,005.83 10,827.08 (3,852.56) (22,352.17) (26,204.73) 43,971.39 22,000,000 As at June 30, 2012 No. of Shares 22,000,000 (` in lacs) As at June 30, 2012 8,943.21 4,400.00 46,005.84 10,827.08 24,411.92 (28,264.46) (3,852.54) 66,323.59 (` in lacs)
170,474.92 5,271.55 -141.58 -17.93 -175,905.98 -175,905.98
46,369.60 1,606.62 3,625.00 460.41 730.65 28.59 -52,820.87 -52,820.87
2,663.75 8,093.01 -822.64 -25.45 186.44 11,791.29 (11,791.29) --
26,811.75 2,320.02 5,505.64 991.82 6,995.95 32.70 358.93 43,016.81 (43,016.81) --
1) Rupee Loan from banks and Financial Institution (except to the extent stated in point no 2 and 3 below) a) Rupee Term Loan from banks and financial institution are secured by pari- passu 1st charge over the entire fixed assets (both present and future) and 2nd charge over the entire current assets (both present and future) of the Company's units at Ranigunj and Durgapur in the state of West Bengal and Durg in the state of Chhattisgargh. The above loan are further secured as follows. (i) Personal Guarantees of Promoter Directors of the Company. (ii) Corporate Guarantee of M/s Shri Marutaye Balaji Steels Limited, a promoter group company
83


(iii) Assignment of mining rights for limestone mines at Satna, Madhya Pradesh of M/s Shri Marutaye Balaji Steels Limited (iv) Pledge of equity shares of the Company held by the promoters b) Rupee Term Loan from banks and financial institution carry interest as follows: (i) term loan and working capital term loan aggregating ` 154,515.11 lacs at base rate of individual lenders plus spread, where spread is computed as difference between 11.75% p.a. and base rate of the individual lenders as on 16th June 2012. (ii) funded interest term loan aggregating ` 19,200.87 lacs at base rate of lead banker (UCO Bank). c) The above loans are repayable as under from the balance sheet date : Payment Terms Installments Due (i) (ii) (iii) (iv) Within 1 year One year to three year Three year to five year More than five year 35 structured quarterly installments starting from June 2013 Number 4 8 8 15 35 (` in lacs) 1,751.51 39,647.25 46,515.60 85,801.59 173,715.95
2) Rupee Term Loan from banks aggregating ` 3,990.86 lacs are secured by way of (i) First mortgage/charge on the entire Fixed Assets, movable and immovable, present and future ranking pari passu amongst the lenders herein (ii) First charge on all the banks accounts of the Company/Project and assignment of all the Company's project contracts and documents ranking pari passu amongst the lenders herein, and (iii) Second charge on all the stock of raw materials, semi-finished and finished goods and receivables, present and future, subservient to prior charge created by the Company in favour of its Working Capital Bankers. The above Loans are guaranteed by three Directors of the subsidiary company. Terms of Repayment (Revised): i) UCO Bank - Quarterly Installments of ` 76.85 lacs commencing from 31.12.2012 ii) State Bank of India - Quarterly Installments of ` 57.50 lacs commencing from 30.09.2012 iii) Axis Bank Ltd. - Quarterly Installments of ` 57.50 lacs commencing from 30.9.2012 3) Rupee Term Loan from a Financial Institution aggregating ` 8,796.42 lacs carry interest in the range of 14.50% - 15% p.a. and is repayable in 8 equal quarterly installments starting from 15th May 2012/14th December 2012. The loan is secured by Bank Guarantee, pledge of certain promoter's shareholdings in the Company and personal guarantees of certain promoter directors. 4) Rupee Term Loan from others carry interest in the range of 13.65% - 14% p.a. and is repayable in 34 monthly installments starting from August 2011. The loan is secured by exclusive charge over the assets acquired under respective loan agreements and personal guarantee of certain promoter directors of the Company. 5) Deferred Payment Liabilities carry interest rate of 9.40% to 10.43% and are repayable in 36/42 equal monthly installments from the date of disbursement of the loan amounts. These loans are secured by hypothecation of respective assets acquired there from. 6) Sales tax loan from Government of Chhattisgarh is interest free and is repayable in 12 yearly installments starting from 31st March, 2002 Note 6 : Provisions Long Term As at March 31, 2013 Provision for employee benefits : Gratuity (Refer Note 34) Leave Salary Other Provision : Provision for Taxation [Net of Advance Tax ` Nil (` 3,724.49 lacs)] Provision for Wealth Tax 9.83 0.32 As at June 30, 2012 9.98 0.24 (` in lacs) Short Term As at As at March 31, 2013 June 30, 2012 537.54 121.10 341.15 106.29
--10.15
--10.22
-0.45 659.09
7.98 0.43 455.85
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Note 7 : Short Term Borrowings As at March 31, 2013 Secured Loan Repayable on Demand - Cash Credit from Banks Other Loan and advances Short Term Loans From Banks Total -56,063.89 29,500.00 119,672.93 56,063.89 90,172.93 (` in lacs) As at June 30, 2012
Cash Credit facilities from banks aggregating ` 52,434.25 lacs are secured by pari- passu 1st charge over the entire current assets (both present and future) and 2nd charge over the entire fixed assets (both present and future) of the Companys units at Ranigunj and Durgapur in the state of West Bengal and Durg in the state of Chhattisgarh. The above facilities are further secured as follows. (i) Personal Guarantees of Promoter Directors of the Company. (ii) Corporate Guarantee of M/s Shri Marutaye Balaji Steels Limited, a promoter group company (iii) Assignment of mining rights for limestone mines at Satna, Madhya Pradesh of M/s Shri Marutaye Balaji Steels Limited (iv) Pledge of equity shares of the Company held by the promoters Cash Credit facilities from banks aggregating ` 3,629.64 lacs are secured by way of hypothecation of all current assets including stock and book debts (both present and future) and second charge on all fixed assets (both present and future) of the subsidiary company. The facility are further guaranteed by three Directors of the subsidiary company. Note 8 : Trade Payables and other Current Liabilities As at March 31, 2013 Trade Payables (Refer Note 35 for details due to Micro and Small Enterprises) - Raw materials [including acceptances of ` 16,347.43 lacs (` 8,269.57 lacs)] - Others (` in lacs) As at June 30, 2012
62,976.26 32,280.92 95,257.18
54,316.57 26,115.62 80,432.19 43,016.81 4,770.67 191.83 5,897.21 10,312.06 944.90
Current Maturities of Long Term Borrowings (Refer Note 5) Capital Creditors Interest Accrued but not due on Borrowings Interest Accrued and due on Borrowings Advance from Customer Temporary Book Overdraft Investor Education and Protection Fund will be credited by the following amounts (as and when due) - Unclaimed Dividend - Unclaimed Fractional Share Liabilities Others - Statutory Dues Payable - Excise Duty payable on Closing Stock - Interest Others - Due to Employees - For Minning - Other Miscellaneous Total
11,791.29 4,089.41 66.76 205.58 7,885.60 214.12
2.95 0.16 3,636.02 908.48 374.99 1,283.80 94.79 234.07 30,788.02 126,045.20
4.72 0.16 5,051.97 3,125.80 523.06 1,282.48 104.16 198.37 75,424.20 155,856.39
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Note 9 : Tangible Assets
Gross Block Description
Freehold Land Leasehold Land Factory Buildings Railway Siding Plant and Machinery Electrical Installations Furniture, Fixtures Office Equipments Vehicles Total Previous Years Total
(` in lacs)
Depreciation / Amortisation As at March 31, 2013
4,449.25 707.57 42,520.10 4,354.18 184,745.14 25,610.40 138.31 916.79 324.04 263,765.78 213,355.49
Net Block As at As at March 31, 2013 March 31, 2013

125.95 4,290.98 957.81 43,114.27 5,116.55 61.08 569.81 178.01 54,414.46 4,449.25 581.62 38,229.12 3,396.37 141,630.87 20,493.85 77.23 346.97 146.03 209,351.32
As at June 30, 2012

3,585.64 707.57 29,703.71 4,352.36 152,150.02 21,476.94 137.56 902.25 339.44 213,355.49 200,798.85
Additions
863.61 12,816.39 1.82 32,610.61 4,133.46 1.47 14.54 6.45 50,448.35 12,648.98
Deductions
15.49 0.72 21.85 38.06 92.34
Up To June 30, 2012

118.08 3,511.04 802.71 35,734.74 4,333.11 52.99 526.30 164.35 45,243.32 30,904.86
For the period

7.87 779.94 155.10 7,382.83 783.44 8.24 43.51 24.00 9,184.92 14,371.34
Deductions
3.30 0.15 10.34 13.79 32.88
As at June 30, 2012

3,585.64 589.49 26,192.67 3,549.65 116,415.28 17,143.83 84.57 375.94 175.09 168,112.17
45,243.32
168,112.17
Note 10 : Capital Work-in-Progress and Pre-Operative Expenditure Pending Allocation As at March 31, 2013 A. Capital Work-in-Progress Buildings Railway Siding Plant and Machinery Furniture and Fixtures Electrical Installations Minning Land Land Sub Total Less : Transferred to Fixed Assets Total A B Pre-operative Expenditure Pending Allocation Opening Balance Additions Power and Fuel Drilling Expenses Salaries, Wages and Bonus Directors Remuneration Rent and Hire Rates and Taxes Insurance Travelling and Conveyance Telephone and Postage Legal and Professional Charges Land Related Expenses Miscellaneous Expenses Depreciation Interest on Term Loans Bank Guarantee Charges Finance Charges Less : Transferred to Fixed Assets Total B 10,813.57 395.37 25,496.13 -3,570.75 1,146.79 6,117.86 47,540.47 39,037.76 8,502.71 13,223.40 352.51 -55.01 -5.62 0.02 0.32 9.81 0.06 31.35 0.65 70.70 0.17 299.01 8.49 5.90 14,063.02 9,255.94 4,807.08
(` in lacs) As at June 30, 2012 12,137.72 395.37 32,335.02 1.17 4,489.88 1,098.66 6,096.27 56,554.09 9,299.77 47,254.32 5,155.90 2,291.90 151.46 555.56 49.00 177.33 1.27 10.08 97.10 15.93 207.47 0.97 156.18 0.15 5,658.08 20.44 152.85 14,701.67 1,478.27 13,223.40
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As at March 31, 2013 C TRIAL RUN EXPENSES Raw Materials Consumed Personnel Cost Salaries, Wages and Bonus Contribution to Provident and Other Funds Manufacturing, Selling and Distribution and Administrative Expenses Consumption of Stores and Spares Labour Charges Power and Fuel Repairs and Maintenance to Others Rent and Hire Other Manufacturing Expenses Legal and Professional Charges Miscellaneous Expenses Interest and Finance Charges Interest on Term Loans Interest on Others Finance Charges Total Less: Sales of Finished Goods [Net of Excise duty and cess ` 628.76 lacs (` Nil lacs)] Closing stock at the end of Trial-run period of a project Finished Goods [Net of Excise duty and cess ` 82.51 lacs (` Nil)] Work-in-Process [Net of Excise duty and cess ` Nil (` Nil)] Sub Total Less : Transferred to Fixed Assets Total C Grand Total (A+B+C) 15,075.69 15,075.69 200.18 3.66 203.84 98.57 270.47 320.29 7.14 135.79 4.19 30.00 27.59 894.04 1,174.25 104.58 62.57 1,341.40 17,514.97 13,881.51
(` in lacs) As at June 30, 2012 ---------------------
1,335.12 428.82
---
15,645.45 1,869.52 1,869.52 -13,309.79
----60,477.72
Consumption of Raw Material : 9 months period ended March 31, 2013 Coking Coal 15,075.69 15,075.69
(` in lacs) 15 months period ended June 30, 2012 ---
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Note 11 : Non Current Investments Number of shares (Valued at cost unless otherwise stated) Non Trade Investment Unquoted, Fully Paid up Investment in Equity Shares Calcutta Stock Exchange Limited [At cost less provision for other than temporary diminution ` 100.89 lacs (`100.89 lacs)] Quoted, Fully Paid up Equity Shares Shyama Infosys Limited Shri Nidhi Trading Co. Limited In Government Securities National Saving Certificate (Deposited with Third Parties) 6,726 1 33.63 33.63 Face Value Per Share As at March 31, 2013 (` in lacs) As at June 30, 2012
366,200 10,500
10 10
25.91 0.95 4.12 64.61 64.61
25.91 0.95 2.62 63.11 63.11 26.86 137.14 100.89 27.57
Aggregate Value of Investments - Quoted - Unquoted Aggregate provision for diminution in the value of Investments *Market Value of Quoted Investments 26.86 138.64 100.89
Note 12 : Deferred Tax Assets /(Liabilities) (Net) As at March 31, 2013 Deferred Tax Asset Unabsorbed Depreciation and carry forward Business Losses Expenses Allowed On Payment Basis/Other Timing Differences Sub Total (A) Deferred Tax Liability Timing Difference on Depreciable assets Sub Total (B) Deferred Tax Assets / (Liabilities) (Net) (A-B) 21,606.96 21,606.96 8,612.58 28,833.28 1,386.26 30,219.54
15,353.87 712.90 16,066.77
18,529.88 18,529.88 (2,463.11)
Although, there is carried forward unabsorbed depreciation as on the reporting date, yet in view of the future profitability projections, the Company is virtually certain that there would be sufficient taxable income in future, to claim the above tax credit.
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Note 13 : Loans and Advances Non Current As at As at March 31, 2013 June 30, 2012 (Unsecured, Considered Good) Capital Advances Security Deposit [Net of Provision for Doubtful Advances ` 24.28 lacs (` 24.28 lacs)] Loans and advances to Related parties Loans to Body Corporate (Receivable on demand)* Advances to a Body Corporate *# Loans to Body Corporate (Receivable on demand) Advances recoverable in cash or kind Advances recoverable in cash or in kind or for value to be received Other Loans and advances Balance with Excise and other Government Authorities Advance income tax [net of Provisions] Sales Tax and Other Refunds Receivable MAT Credit Entitlement Total *(Refer Note 33) # since realised Note 14 : Other Non Current Assets As at March 31, 2013 Non Current bank balances (Refer Note 18) Unamortised Expenses Interest Receivable on Deposits Total Note 15 : Current Investments As at March 31, 2013 Non Trade (Quoted) Investment in Mutual Fund 407.85 units @ NAV ` 100.129 ICICI Prudential Money Market Fund Cash Option Daily Dividend 4237.025 units @ NAV ` 100.369 ICICI Flexible Income Retail Daily Dividend 591.147 units @ NAV ` 105.735 ICICI Flexible Income Plan Regular Daily Dividend Total Aggregate Value of Investments - Quoted Market value of the Investments 1,155.76 4.40 15.56 1,175.72 5,864.15 819.31 5,811.25 1,386.86 Current As at March 31, 2013 -535.31 As at June 30, 2012 -213.12 (` in lacs)
-----
-----
8,500.00 740.22 9,240.22 564.05
8,500.00 -8,500.00 564.05
4.11 4.90 -353.47 5,014.32 5,372.69 12,060.26
-3.90 -366.94 5,014.32 5,385.16 12,583.27
6,789.96 1,349.91 190.42 63.00 -1,603.33 18,732.87
4,759.01 2,184.92 26.25 3.53 -2,214.70 16,250.88
(` in lacs) As at June 30, 2012 107.65 4.40 6.76 118.81 (` in lacs) As at June 30, 2012
0.41 0.30 0.04 0.34 0.34 0.34 0.41 0.41 0.41
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Note 16 : Inventories As at March 31, 2013 Raw Materials [Including in transit ` 5,967.79 lacs (` 5,386.03 lacs)] Stores and Spares [Including in transit ` 185.46 lacs (` 12.88 lacs)] Work-in-Process Finished Goods [including materials lying at port ` 45.04 lacs (`Nil)] By Products and Scrap Total Note 17 : Trade Receivables As at March 31, 2013 Outstanding for a period exceeding six month from the date they are due for payment Unsecured, considered good Unsecured, considered doubtful Less: Provision for Doubtful Debts (A) Other Debts Unsecured, considered good Total Note 18 : Cash and Bank Balances Non Current As at As at March 31, 2013 June 30, 2012 Cash and Cash equivalents Balance with Banks :On Current Accounts Deposits With Original Maturity of Less Than 3 Months* Cash on hand Cheques in hand Unclaimed Dividend Account Unclaimed Fractional Share Balance Other Bank Balances Deposits with original maturity for more than 12 Months* Deposits with original maturity for more than 3 Months but less than 12 months* Amount disclosed under the head Other Non Current Assets (Refer Note 14) Total Current As at March 31, 2013 As at June 30, 2012 (B) (A+B) 46,489.02 4,451.53 793.28 9,759.19 960.51 62,453.53 (` in lacs) As at June 30, 2012 52,526.65 4,802.11 642.46 23,478.79 3,138.75 84,588.76 (` in lacs) As at June 30, 2012
16,246.86 270.62 16,517.48 270.62 16,246.86 53,957.21 70,204.07
14,810.96 437.04 15,248.00 437.04 14,810.96 35,038.14 49,849.10 (` in lacs)
-------1,155.76 -1,155.76 (1,155.76) --
-------107.65 -107.65 (107.65) --
336.58 -96.65 580.73 2.96 0.16 1,017.08 397.36 2,803.91 3,201.27 -4,218.35
141.13 195.58 150.84 97.10 4.73 0.16 589.54 558.10 1,209.40 1,767.50 -2,357.04
* including ` 4,164.53 lacs ( ` 2,070.73 lacs) pledged with banks and others as margin money against borrowings/other facilities
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Note 19 : Other Current Assets As at March 31, 2013 Interest Receivable on Loans, Advances and Deposits Subsidies and Incentives Receivable Total Note 20 : Revenue from Operations 9 months period ended March 31, 2013 Sales of products Finished Goods By Products and Scraps Raw Materials Other Operating Revenue Conversion Charges Subsidy on Sales Tax /Value Added Tax Export Incentives Carbon Credit Income Service and other Charges Revenue from Operations (Gross) Less: Excise Duty Revenue from Operations (Net) Sale of finished goods comprise @ : Sponge Iron Pig Iron Steel Bars/Rods Billet/MS Ingots Ferro Alloys Ductile Iron Pipe Power Coke/Coal Limestone 163,403.96 2,635.73 16.52 1,273.85 2,225.99 16.53 --169,572.58 15,088.83 154,483.75 6,594.29 24,762.93 23,926.58 76,925.90 11,237.35 17,916.09 124.39 1,801.79 114.64 163,403.96 364.53 11,234.90 11,599.43 (` in lacs) As at June 30, 2012 299.27 9,510.39 9,809.66 (` in lacs) 15 months period ended June 30, 2012 301,351.85 6,427.62 3,427.83 3,562.14 1,921.75 240.30 335.78 1,347.92 318,615.19 23,032.04 295,583.15 22,839.03 51,353.32 38,835.11 124,315.71 25,203.45 37,360.98 1,317.63 126.62 -301,351.85
@ excludes goods transferred for further processing and used for self consumption in Fixed Assets/Trial Run.
Note 21 : Other Income 9 months period ended March 31, 2013 Interest on : (a) Fixed Deposits with Banks [Gross, Tax deducted at source ` 13.12 lacs ( ` 18.09 lacs)] (b) Loans and Advances [Gross, Tax deducted at source ` 122.96 lacs ( ` 173.44 lacs)] Commission Received Dividend from long term Investments (other than trade) Dividend from current Investments (other than trade) Insurance Claims Liabilities no longer required written back Provision for doubt debts no longer required written back Gain on Foreign Exchange Fluctuations (Net) Miscellaneous Income Total 187.23 1,230.36 34.13 0.67 0.14 5.25 234.14 122.04 381.93 32.34 2,228.23
(` in lacs) 15 months period ended June 30, 2012 232.97 1,752.01 130.93 0.47 0.12 30.37 449.94 --29.56 2,626.37
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Note 22 : Cost of Materials Consumed 9 months period ended March 31, 2013 Opening Stock Purchases# Less: Closing Stock Raw Materials Consumed Consumption of Raw Material# : Iron Ore/Pellets Manganese Ore Sponge Iron Billet/Ingot Coke/Coal Magnesium Metal Pig Iron Steel Scrap & Wastes Ferro Alloys Quartzite, Limestone and Dolomite Purchase of Stock in Trade includes: Coal DI Fittings 52,526.65 99,681.90 152,208.55 46,489.02 105,719.53 24,123.20 4,862.94 13,310.20 1,551.03 57,944.52 285.51 25.12 526.60 558.99 2,531.42 105,719.53 118.96 36.76 155.72 Note 23 : Changes in Inventories of Finished Goods, Work-in-Progress and Stock-in-Trade 9 months period ended March 31, 2013 Opening Stocks Work-in-Process Finished Goods By Products and Scrap Add: Stock transferred from Trial Run (Refer Note 10) Less: Transferred to Tangible Assets Less: Closing Stocks Work-in-Process Finished Goods By Products and Scrap 642.46 23,478.79 3,138.75 27,260.00 1,763.94 29,023.94 -29,023.94 793.28 9,759.19 960.51 11,512.98 17,510.96 (Increase)/Decrease in excise duty and cess on stocks Total (2,217.31) 15,293.65 (` in lacs) 15 months period ended June 30, 2012 45,547.35 240,377.45 285,924.80 52,526.65 233,398.15 65,984.14 13,304.67 18,291.07 9,017.50 119,337.61 580.01 24.56 1,342.15 1,455.87 4,060.57 233,398.15 126.62 -126.62 (` in lacs) 15 months period ended June 30, 2012 709.11 8,356.01 3,260.45 12,325.57 -12,325.57 19.70 12,305.87 642.46 23,478.79 3,138.75 27,260.00 (14,954.13) 1,964.02 (12,990.11)
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Note 23 : Changes in Inventories of Finished Goods, Work-in-Progress and Stock-in-Trade (Contd.) 9 months period ended March 31, 2013 Stock of finished goods comprises Opening Stock Sponge Iron Pig Iron Steel Bars/Rods Billet/MS Ingots Ferro Alloys Ductile Iron Pipe Total Closing Stock Sponge Iron Pig Iron Steel Bars/Rods Billet/MS Ingot Ferro Alloys Ductile Iron Pipe Coke Total 2,721.08 10,575.45 164.56 8,030.41 382.93 1,604.36 23,478.79 522.56 4,463.22 146.54 2,182.35 529.97 1,004.89 909.66 9,759.19 1,702.48 273.16 2,129.71 1,899.96 907.49 1,443.21 8,356.01 2,721.08 10,575.45 164.56 8,030.41 382.93 1,604.36 -23,478.79 (` in lacs) 15 months period ended June 30, 2012
Note 24 : Employee Benefits Expense 9 months period ended March 31, 2013 Salaries, Wages, Bonus & Other Benefits Contribution to Provident Fund & other fund Staff Welfare Expenses Directors remuneration Total 4,676.06 369.08 186.27 36.00 5,267.41
(` in lacs) 15 months period ended June 30, 2012 7,209.45 313.72 309.99 3.50 7,836.66
Note 25 : Finance Costs 9 months period ended March 31, 2013 Interest Expenses On Term loans On Income Tax On Others Finance charges Total 12,341.92 -4,650.01 1,518.56 18,510.49
(` in lacs) 15 months period ended June 30, 2012 14,696.75 190.64 15,302.03 2,473.69 32,663.11
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Note 26 : Other Expenses 9 months period ended March 31, 2013 Consumption of Stores and Spares Labour Charges Processing Charges Power and Fuel Repairs and Maintenance: - Plant and Machinery - Buildings - Others Water Charges Equipment Hire Charges Shifting Expenses Freight and Transportation Rent and Hire Rates and Taxes Insurance Advertisement Brokerage and Commission (Other than Sole Selling Agents) Travelling and Conveyance Telephone and Postage Legal and Professional Charges (Refer Note 40) Directors Fees Provision for Diminution in the Value of Investments Irrecoverable Debts and Advances Written off Less: Adjusted against Provisions Loss on sale of long term non trade Investments Less: Adjusted against Provisions Loss on Foreign Exchange Fluctuations (Net) Charity and Donations Security and Service Charges Loss on Sale of Fixed Assets Miscellaneous Expenses Prior period Expenses Total 10,516.51 4,066.33 35.75 13,369.95 421.46 84.58 187.26 284.34 1,587.15 558.44 2,059.27 159.30 831.39 108.86 47.96 169.84 377.35 79.05 281.84 1.45 -91.74 44.38 ----11.73 337.73 2.72 313.36 65.67 36,006.65 47.36 681.54 82.10 150.00 -150.00 912.96 41.37 564.74 12.08 706.23 365.14 62,325.13 (` in lacs) 15 months period ended June 30, 2012 20,498.24 6,429.62 135.24 19,069.08 1,105.09 205.10 296.94 472.71 3,052.77 1,537.96 3,392.15 217.31 567.88 178.82 115.78 383.01 585.99 109.09 517.30 2.20 100.89 599.44
94


27. Contingent liabilities not provided for: As at March 31, 2013 a) Claims against the Company not acknowledged as debts i) Excise and Service Tax Demands under dispute/appeal ii) Sales Tax/VAT matters under dispute/appeal b) Letters of Credit, Bills discounted and Bank Guarantees outstanding c) Custom Duty on Import of Equipment and spare parts under EPCG Scheme d) Guarantees and Counter guarantees given by the Company for loans obtained by Subsidiary/other company 28. Estimated amount of contracts remaining to be executed on Capital Account and not provided for [Net of Advances ` 5,864.15 lacs (` 5,811.25 lacs)] 6,372.08 6,736.99 12,540.94 2,468.83 7,180.00 1,943.41 (` in lacs) As at June 30, 2012 4,028.91 11,552.59 12,946.16 2,266.13 7,780.00 1,934.78
29. In respect of an electricity supply matter where the Electricity Supplier has demanded enhanced charges, the matter was challenged by the Company at the Appellate Tribunal for Electricity (the tribunal). The Tribunal vide its order dated May 10, 2010 dismissed the appeal of the Supplier and directed to implement the tariff as determined by the Central Electricity Regulatory Commission vide its Order dated August 6, 2009. The Supplier has preferred an appeal with Honble Supreme Court, pending finalisation of the outcome of the matter, the liabilities for the electricity charges are accounted for based on provisional bills provided by the Supplier. 30. On 9th June 2011, the Income Tax Department had carried out Search, Seizure and Survey at the Companys premises. Subsequent to the aforesaid, the Company has admitted no irregularities in the books. However, to buy peace and avoid litigation with the department, surrendered an Income of ` 3,805.50 lacs for the previous year ended 31/3/2011. The Income Tax authorities are yet to complete assessment proceedings in respect of search and seizure operations. 31. During the financial year, the Corporate Debt Restructuring (CDR) Cell through its Empowered Group has approved a debt restructuring scheme for the Company which provides for revision in interest rates, deferment of repayment of term loans, conversion of interest into Funded Interest term loan and additional infusion of ` 5,000.00 lacs into the Company. In view of the above ` 2,509.25 lacs as Money Received against share warrants have been brought up front as stipulated in the restructuring scheme and balance to be brought within a period of one year from the date of Letter of Approval dated 20th September 2012. Necessary adjustments in the books of accounts have been made to reflect the impact of the aforesaid restructuring scheme. 32. During the year, the Company has accounted for the following subsidies/incentives receivable from the Government of West Bengal under West Bengal Incentive Scheme aggregating to ` 2,225.99 lacs (` 1,921.75 lacs): (` in lacs) Sl. No. a) Particulars Industrial Promotion Assistance Account to which credited Subsidy on Sales Tax/ Value Added Tax under Sales & Service 9 months period ended March 31, 2013 2,225.99 15 months period ended June 30, 2012 1,921.75
33. Loans and Advances includes the following balances Name of the Company As at March 31, 2013 Maximum Amount due at any time during 9 months period ended March 31, 2013 As at June 30, 2012
(` in lacs) Maximum Amount due at any time during 15 months period ended June 30, 2012
In terms of Clause 32 of the Listing Agreement Jai Balaji Jyoti Steels Ltd. 9,240.22 9,240.22 8,499.63 12,088.17
95


34 Gratuity The Group has a defined benefit gratuity plan. Every employee who has completed five years or more of service is entitled to gratuity on terms not less favourable than The Provisions of Payment of Gratuity Act, 1972. The Holding Company and its Subsidiary Company (NIPL) have funded their gratuity liability with insurance company in the form of a qualifying insurance policy. In respect of a joint venture company, Andal East Coal Company Private Ltd the aforesaid scheme is The disclosures required under Accounting Standard 15 Employee Benefits notified in the Companies (Accounting Standards) Rules, 2006 are given below: I. Expenses recognized in the Statement of Profit & Loss Account are as follows : 9 months period ended March 31, 2013 Current service cost Interest cost on benefit obligation Expected return on plan assets Net actuarial loss/(Gain) recognised during the period Past Service cost Total Expenses* * Includes ` Nil (` 31.26 lacs) transferred to Preoperative/Trial Run II. Net Liability/(Assets) recognized in the Balance Sheet are as follows: As at March 31, 2013 Present value of Defined Benefits Obligation Fair value of plan assets Less: Unrecognised past service cost Total Expenses 907.76 360.39 547.37 547.37 (` in lacs) As at June 30, 2012 698.48 338.22 360.26 9.13 351.13 (` in lacs) As at June 30, 2012 603.02 221.44 60.41 (27.89) (158.50) -698.48 (` in lacs) As at June 30, 2012 231.77 30.28 102.71 (27.89) 1.35 338.22 122.09 44.01 (22.74) 58.76 9.13 211.25 (` in lacs) 15 months period ended June 30, 2012 221.44 60.41 (30.28) (159.86) 15.54 107.25
III. Change in the present value of the defined benefit obligation during the period are as follows: As at March 31, 2013 Present Value of Defined Benefit Obligation at the beginning of the period Current Service Cost Interest Cost Benefits Paid Actuarial Loss/(Gain) Plan Amendments Present Value of Defined Benefits Obligation at the period end IV. Change in the Fair Value of Plan Assets during the period ended are as follows: As at March 31, 2013 Fair Value of Plan Assets at the beginning of the year Expected Return Contribution by Employer Benefits paid Actuarial Gains/(Losses) Fair Value of Plan Assets at the period end 338.22 22.74 15.00 (17.58) 2.01 360.39 698.48 122.09 44.00 (17.58) 60.77 -907.76
96


V. The major categories of plan assets as a percentage of the fair value of the total plan assets As at March 31, 2013 Investment with the insurer 100% (` in lacs) As at June 30, 2012 100%
VI. The principal assumptions used in determining gratuity obligations for the Companys plans are shown below. 9 months period ended March 31, 2013 Discount Rate Expected Rate or return on assets Rate of increase in salaries Mortality Table 8.20% 9.00% 10.00% Indian Assured Life Mortality (2006-08) (modified) Ult 15 months period ended June 30, 2012 8.50% - 8.60% 9.00% 7.50% - 10.00% LIC (1994-96) ultimate
VII. Amounts for the current and previous years are as follows: As at March 31, 2013 Defined benefit obligation Plan Assets Surplus / (Deficit) Experience Gain/ (Loss) Adjustments on plan liabilities Experience Gain/ (Loss) Adjustments on plan assets Experience Gain/ (Loss) due to change on assumptions (907.76) 360.39 (547.37) (14.89) 0.86 (44.73) As at June 30, 2012 (689.35) 338.22 (351.13) 130.69 1.62 27.54 As at March 31, 2011 (578.35) 231.77 (346.58) (68.73) (1.20) -As at March 31, 2010 (350.49) 169.59 (180.90) (23.15) (0.14) 22.91
(` in lacs) As at March 31, 2009 (189.76) 84.53 (105.23) Not Available Not Available Not Available (` in lacs) 9 months period ended March 31, 2013 15 months period ended June 30, 2012 502.47
Contribution to Provident Fund and other Funds Note: i)
522.18
The Holding Company expects to contribute ` 528.64 lacs (` 340.71 lacs) to Gratuity Fund in 2013-14. The Subsidiary Company expects to contribute ` 17.60 lacs (` 9.71 lacs) to Gratuity Fund in 2013-14.
ii) The estimates of future salary increases, considered in actuarial valuation, take account of inflation, seniority, promotion and other relevant factors, such as supply and demand in the employment market. The above information is certified by the Actuary. iii) The management has relied on the overall actuarial valuation conducted by the actuary.
97


35. Based on the information available with the Company, the amounts due to Micro and Small Enterprises as per MSMED Act, 2006 are as follows : (` in lacs) Sl Particulars No. a) b) c) d) Principal Amount remaining unpaid to the suppliers as at the end of the period Interest due on above remaining unpaid to the suppliers as at the end of the period Amount of interest paid by the buyer in terms of section 16, of the Micro Small and Medium Enterprise Development Act, 2006 Amount of interest due and payable for the period of delay in making payment (which have been paid beyond the appointed day during the year) but without adding the interest specified under Micro Small and Medium Enterprise Development Act, 2006 Amount of interest accrued and remaining unpaid at the end of each accounting year; and Amount of further interest remaining due and payable even in the succeeding years. 9 months period ended March 31, 2013 --------15 months period ended June 30, 2012 ---------
e) f)
-----
-----
36. Excise duty on increase/decrease in stock represents differential excise duty on opening and closing stock of Finished Goods. 37. (i) Unhedged Foreign Currency Exposures outstanding at the year end are as follows : Particulars Receivables (a) (b) Trade Receivables Advances Total Payables (a) Trade Payables Total Loans (a) Foreign Currency Loans Total (ii) Forward Cover Contracts outstanding at the year end represents the following: Contracts of US $ Nil (US $ 1,650,000) for minimizing the risk of currency exposure on foreign currency loans from banks aggregating ` Nil (` 929.10 lacs). US$ ---12,071,788 6,797.50 6,797.50 US$ Euro 496,368 83,635 269.97 58.16 328.13 27,402,886 241,437 15,430.29 171.20 15,601.49 US$ US$ 78,215 114,654 42.54 62.36 104.90 -68,746 -38.71 38.71 Foreign Currency (FC) As at March 31, 2013 in FC
` in lacs
As at June 30, 2012 in FC

` in lacs
98


38. Basic and diluted earnings per share : Sl Particulars No. A B C D E F G Profit/(Loss) after Tax Number of shares at the beginning of the year Total equity shares outstanding at the end of the year Weighted average number of equity shares outstanding at the end of the year Nominal Value of each Share Basic Earning per Share Diluted Earning per Share
` in lacs
9 months period ended March 31, 2013 Nos. Nos. Nos.

` ` `
15 months period ended June 30, 2012 (28,264.46) 63,781,486 63,781,486 63,781,486 10.00 (44.31) (44.31)
(22,352.17) 63,781,486 63,781,486 63,781,486 10.00 (35.04) (35.04)
39. Related Party Disclosures a. Name of Related Parties Key Management Personnel Mr. Aditya Jajodia, Chairman and Managing Director Mr. Sanjiv Jajodia, Wholetime Director Mr. Aashish Jajodia, Wholetime Director of Subsidiary Mr. Rajiv Jajodia, Brother of Wholetime Director Mr. Devendra Prasad Jajodia, Brother of Wholetime Director Mr. Gourav Jajodia, Nephew of Wholetime Director Smt. Kanchan Jajodia, Sister-in-law of Wholetime Director Smt. Rina Jajodia, Sister-in-law of Chairman and Managing Director Smt. Sangeeta Jajodia, Wife of Wholetime Director Smt. Shashi Devi Jajodia, Sister-in-law of Wholetime Director Smt. Seema Jajodia, Wife of Chairman and Managing Director Chandi Steel Industries Limited (CSIL) Jai Balaji Jyoti Steels Limited (JBJSL) Jai Salasar Balaji Industries Private Limited (JSBIPL) Balaji Ispat Udyog (BIU) Enfield Suppliers Limited (ESL) Hari Management Limited (HML) Jain Vanijya Udyog Limited (JVUL) Jajodia Estate Private Limited (JEPL) K.D. Jajodia Steel Industries Private Limited (KDJSIPL) Shri Marutaye Balaji Steels Limited (SMBSL)
99

(` in lacs)
Sales Purchases Rent paid Interest Received 294.61 (500.87) 31.50 (52.50) (44.88) (28.18) (10.00) (130.49) 0.35 (0.65) (10.09) 950.00 1,559.25 2,509.25 862.83 (1,127.91) 1,157.44 (1,628.77) 3,023.57 (4,379.05) 9,240.22 (8,499.63) 12,263.79 (12,878.68) (4.49) (1,229.43) (1,229.43) (0.43) 0.15 (0.30) (6.27) 0.20 (0.35) 235,910.85 (197,830.17) 226,150.21 956,744.26 (617,879.22) 31.50 (52.50) (3.18) 7,620.50 (8,129.57) (10.60) 243,531.35 (205,959.74) 226,150.21 226,150.21 (12.37) 243,531.35 (205,959.74) Managerial Dividend remuneration paid Director Fee Corporate Guarantee Given Money Received against share warrants Balance Receivable Balance Payable Guarantees Obtained
100
-2,235.02 (7,087.92) 0.52 (0.86) 0.52 (0.86) 2,253.03 (231.19) (14,471.05) 2,856.66 (3,724.14) 5,091.68 4,004.16 (11,043.25) (19,386.94) 183.18 1,669.21 (4,599.34) 81.92 (133.37) -
b) Related Party Transactions :
Relationship
Party
Key Management Personnel
Aditya Jajodia
Sanjiv Jajodia
Aashish Jajodia
Rajiv Jajodia
Gourav Jajodia
Others
CSIL
JBJSL
JSBIPL
SMBSL
JEPL
ESL
HML
Others
Total


40. Auditors Remuneration (included in Legal and Professional Charges) Payment to Auditor 9 months period ended March 31, 2013 (` in lacs) 15 months period ended June 30, 2012
Holding Company As auditor : Audit fee Limited Review Tax Audit Out-of-pocket expenses In other manner for Certification Total* Subsidiary Companies As auditor : Audit fee Tax Audit Out-of-pocket expenses Total *Out of above amount, paid to previous auditor amounts to ` Nil (` 26.60 lacs) 41. The Proportinate share of Assets, Liabilities and Equity for 9 months period ended March 31, 2013 and Income and Expenditure for the year ended March 31, 2013 of Joint Venture Companies viz. M/s Rohne Coal Company Private Limited and M/s Andal East Coal Company Private Limited are included in these financial statements in respective items. (` in lacs) As at March 31, 2013 Assets Non Current Assets Fixed Assets : Tangible Assets Capital Work in Progress and Pre-operative Expenditure Pending Allocation Long - Term Loans & Advances Current Assets Current Investments Cash and Bank Balances Short - Term Loans & Advances Non Current Liabilities Long Term Provisions Current Liabilities Trade Payables Other Current Liabilities Short Term Provisions Equity Reserves and Surplus Share Application Money Capital Commitment and Contingencies : Contingent Liability Capital Commitment and Contingencies : As at June 30, 2012 2.61 0.75 0.12 3.48 2.72 0.75 0.12 3.59 9.50 5.00 1.50 0.54 -16.54 6.00 26.50 0.75 0.60 3.50 37.35
87.97 723.25 9.52 0.32 5.55 43.21 1.45 0.26 97.43 0.15 99.65 240.16 -9.98
74.57 655.97 13.32 0.41 22.23 42.05 0.50 0.10 114.83 0.83 (1.20) 230.86 514.08 10.52
101


9 months period ended March 31, 2013 Income Other Income Expenditure Other Expenses 2.15 0.95 0.14 0.12 15 months period ended June 30, 2012
42 i) The current financial year of the Group is for the period of nine months from 1st July, 2012 to 31st March, 2013 as compared to previous financial year of fifteen months from 1st April, 2011 to 30th June, 2012. Hence, the current period's figures are not comparable with previous period's figures. ii) Figures in brackets represent previous financial years figures, which have been rearranged/regrouped wherever necessary to conform to this year's classification.
For and on behalf of the Board of Directors
Aditya Jajodia Chairman & Managing Director Rajiv Jajodia Director
Sanjiv Jajodia Wholetime Director Raj Kumar Sharma Chief Financial Officer
102

Directors Report
To the Members of Nilachal Iron & Power Limited
Your Directors are pleased to present their Eleventh Annual Report together with the Audited Balance Sheet and Statement of Profit and Loss Account of your Company for the year ended 31st March, 2013. FINANCIAL PERFORMANCE Particulars Revenue from Operations (Net of Excise Duty) Other Income Total Income Less: Expenditure Profit/Loss before Interest, Depreciation and tax (PBIDT) Less: Finance Charges Depreciation Profit/(Loss) before Tax Less: Tax Profit/(Loss) for the year Earnings per share (Nominal value per share ` 10/-) Basic and Diluted Operational Performance During the year under review, your Company has achieved the total revenues of ` 2,400.29 lacs against ` 9,891.18 lacs in the previous year. The EBIDTA for the year amounted to ` 701.56 lacs while the same was ` 828.67 lacs for the previous year. The Loss for the year 2012-13 stood ` 1677.72 lacs as compared to loss of ` 24.23 lacs in the last year. During the year two coal washery was put to use and two units of Kiln was introduced and operation started in the plant. Dividend In view of financial position of the Company during the financial year, the directors do not recommend any dividend on the Equity Shares of the Company for the year ended 31st March, 2013. Future Outlook World Steel Association has said steel demand is expected to pick up in India and demand expected to grow by 5.9% to 75.8 million tonne (mt) in 2013 following 2.5% growth in 2012. It also said that Indian steel demand is likely to grow due to monetary easing which is expected to support investment activities. In 2014, growth in steel demand is further to accelerate to 7.0% because of the reform measures aimed at narrowing the fiscal deficit, coupled with measures to improve the foreign direct investment climate. The Company shall take steps to further strengthen its operations and make use of most of the accelerated demand. Holding Company The company continued to be a wholly owned subsidiary of M/s. Jai Balaji Industries Limited throughout the year under review. Directors Pursuant to the provisions of the Companies Act, 1956 Shri Aditya Jajodia and Shri Santosh Kumar Shah, Directors of the Company retire by rotation at the ensuing Annual General Meeting of the Company and being eligible have offered themselves for re-appointment. Shri Prashant Akhaury has been appointed as Executive Director of the Company, being an Additional Director, w.e.f. 7th November, 2012, and he will hold office up to the date of the ensuing Annual General Meeting. 2012-13 (`) 23,36,96,931.00 63,32,165.00 24,00,29,096.00 31,01,85,280.00 (7,01,56,184.00) 10,55,29,022.00 7,10,15,680.00 (24,67,00,886.00) 7,89,29,000.00 (16,77,71,886.00) 2011-12 (`) 981,883,123.00 72,34,948.00 989,118,071.00 906,250,972.00 82,867,099.00 4,73,86,658.00 3,57,50,012.00 (2,69,571.00) 21,54,152.00 (24,23,723.00)
The Company has received special notice under Section 257 of the Companies Act, 1956, proposing the appointment of Shri Prashant Akhaury as the Director of the Company. In view of their considerable experience, your Directors recommend his appointment. Shri Prasant Akhaury if appointed, shall continue to act as an Executive Director of the Company. Board Sub Committees i. Audit Committee: The Audit Committee of the Company consists of four directors, namely Shri Sanjiv Jajodia, Shri Ashim Kumar Mukherjee, Shri Dinesh Kumar Agarwal and Shri Santosh Kumar Shah. Shri Sanjiv Jajodia being a non-executive director of the Company acts as the Chairman of the Committee. ii. Remuneration Committee: The Remuneration Committee of the Company consists of four directors, namely Shri Sanjiv Jajodia, Shri Ashim Kumar Mukherjee, Shri Dinesh Kumar Agarwal and Shri Santosh Kumar Shah. The Chairman of the Committee is Shri Sanjiv Jajodia. Directors Responsibility Statement Pursuant to the requirement of Section 217(2AA) of the Companies Act, 1956, your Directors state that: i) In the preparation of annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures.
(4.81)
0.07
ii) They have opted such accounting policies and applied them consistently and made judgements and estimates that were reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at 31st March, 2013 and of the loss of the Company for the year ended on that date; iii) They have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities; and iv) The annual accounts have been prepared on a going concern basis. Statutory Auditors M/s. B. Chhawchharia & Co., Chartered Accountants, Kolkata retire at the conclusion of ensuing Annual General Meeting and being eligible offers themselves for re-appointment. Your directors on the recommendation of Audit Committee, recommends re-appointment of M/s. B. Chhawchharia & Co., Chartered Accountants, Kolkata as the Statutory Auditors of the Company to hold office from the conclusion of the ensuing Annual General Meeting till the conclusion of the next Annual General Meeting. The Company has received a certificate from the said auditors under Section 224(1B) of the Companies Act, 1956 to the effect that their appointment if made, would be within the prescribed limits under Section 224(1B) of the Companies Act, 1956. Auditors Report The Auditors report to the shareholders does not contain any qualifications. The observations of Auditors in their Report read with relevant notes to accounts in Note 25 are self explanatory and do not require further explanation. Cost Auditors Pursuant to the provisions of Section 233B of the Companies Act, 1956 read with Cost Accounting Records (Steel Plant) Rules, 1990, The Companies (Cost Accounting Record) Rules, 2011, The Companies (Cost Audit Report) Rules, 2011, Circular No. 15/2011[52/5/CAB2011] dated 11th April, 2011, Circular No. 52/26/CAB2010 dated 30th June, 2011 and Circular No. 36/2012[52/5/CAB-2011], dated 6th November, 2012 your directors on the recommendation of the Audit Committee, have appointed M/s. Mondal & Associates, proprietor Mr. Amiya Mondal
103


as the Cost Auditors to conduct the Cost Audit for the Financial Year 201314. Conservation of Energy, Technology Absorption, Foreign Exchange Earnings and Outgo In accordance with the provisions of Section 217(1)(e) of the Companies Act, 1956 read with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988 as amended from time to time, particulars regarding Conservation of Energy, Technology Absorption, Foreign Exchange Earnings and Outgo are given in the Annexure forming part of this Report. Personnel The Company has no employee getting remuneration in the category specified under Section 217(2A) of the Companies Act, 1956 read with Companies (Particulars of Employees) Rules, 1975 during as amended from time to time. Appreciation Your Directors place on record their gratitude for the valuable trust, cooperation and support rendered by the Financial Institutions, Banks, Regulatory and Government authorities, dealers, suppliers, business associates and the Companys valued customers. The Directors also commend the commitment and dedication of the employees and workers of the Company whose unstinted hard work, efforts and ideas have taken the Company on a path of steady growth and development. For and on behalf of the Board C. Foreign exchange earnings and outgo: a) Activities relating to exports, initiatives taken to exports, development of new export markets for products and services and export plans: Nil b) Total Foreign Exchange used and earned: Nil FORM A Form for Disclosure of Particulars with respect to Conservation of Energy A. Power and Fuel consumption: Electricity a) Purchased Units (KVAH) Total Amount (` in lacs) Rate per Unit (`) B. Electricity Consumption per unit (M.T.) of consumption: Sponge iron 247.00 137.22 2012-13 17,16,984 146.25 8.52 2011-12 5,295,564 291.99 5.51
Form for Disclosure of Particulars with respect to Technology Absorption Research and Development (R & D) 1. Specific areas in which R & D carried out by the Company: No R&D was carried out within the meaning of applicable accounting standard.
Place : Kolkata Dated: 29th July, 2013
2. 3.
Benefits derived as results of the above R & D: Not Applicable. Future Plan of action: The Company strives towards energy conservation measures, use of alternative raw materials , improvement in quality and productivity.
Annexure To Directors Report

Information under Section 217(1)(e) read with the Companies (Disclosure of particulars in the Report of Board of Directors) Rules, 1988 and forming part of the Directors Report for the year ended 31st March, 2013: A. Conservation of energy: a) Energy conservation measures taken: Continuous efforts are being made to identify & implement energy conservation measures at all stages of production process. b) Additional Investments and Proposals, if any, being implemented for reduction of consumption of energy: Nil c) Impact of the measures at (a) and (b) above for reduction of energy conservation and consequent impact on the cost of production of goods:
q
4.
Expenditure on R & D: Nil Technology absorption, adaptation and innovation: a) Efforts, in brief, made towards technology absorption, adaptation and innovation. Continuous endeavor is being made to streamline production process, improve machine availability and performance and to achieve highest standards, of quality and quantity benchmark. b) Benefits derived as a result of the above efforts. As a result of above efforts, there was improvement in product quality, better and easier availability of materials and saving in process cost. c) In case of imported technology (imported during the last 5 years reckoned from the beginning of the financial year), the following information may be furnished : (i) Technology imported (ii) Year of import (iii) Has technology been fully absorbed? : Nil : Not Applicable : Not Applicable
The above measures have resulted in energy saving cost and thus have led to reduce cost of production. As a result of above measures efficient utilization of power and other energy sources has been achieved.
d) Total energy consumption and energy consumption per unit of production as per Form A of the Annexure is annexed. B. Technology absorption: The details of efforts made towards absorption of technology are given in the Report in Form B.
(iv) If not fully absorbed, areas where this : Not Applicable has not taken place, reasons thereof and future plans of action
104

Auditors Report
To the Members of Nilachal Iron & Power Limited
REPORT ON THE FINANCIAL STATEMENTS We have audited the accompanying financial statements of M/s NILACHAL IRON & POWER LIMITED (the Company), which comprise the Balance Sheet as at March 31, 2013, and the Statement of Profit and Loss and Cash Flow Statement for the year then ended, and a summary of significant accounting policies and other explanatory information. MANAGEMENTS RESPONSIBILITY FOR THE FINANCIAL STATEMENTS Management is responsible for the preparation of these financial statements that give a true and fair view of the financial position and financial performance of the Company in accordance with the Accounting Standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956. This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error. AUDITORS RESPONSIBILITY Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with the Standards on Auditing issued by the Institute of Chartered Accountants of India. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditors judgement, including the assessment of the risks of material
misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the Companys preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion. OPINION In our opinion and to the best of our information and according to the explanations given to us, the financial statements give the information required by the Act 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 the Balance Sheet, of the state of affairs of the Company as at March 31, 2013, and (b) in the case of the Profit and Loss Account, of the loss for the year ended on that date, and (c) in the case of the Cash Flow Statement, of the cash flows for the year ended on that date. REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS 1. As required by the Companies (Auditors Report) Order, 2003 issued by the Central Government of India in terms of sub-section (4A) of section 227 of the Act, we give in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the said Order. 2. As required by section 227(3) of the Act, we report that: a) 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; b) in our opinion proper books of account as required by law have been kept by the Company so far as appears from our examination of those books; c) the Balance Sheet and Statement of Profit and Loss dealt with by this Report are in agreement with the books of account; d) in our opinion, the Balance Sheet and Statement of Profit and Loss and Cash Flow Statement comply with the Accounting Standards referred to in subsection (3C) of section 211 of the Companies Act, 1956; e) on the basis of written representations received from the directors as on March 31, 2013, and taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2013, from being appointed as a director in terms of clause (g) of sub-section (1) of section 274 of the Companies Act, 1956. f) Since the Central Government has not issued any notification as to the rate at which the cess is to be paid under section 441A of the Companies Act, 1956 nor has it issued any Rules under the said section, prescribing the manner in which such cess is to be paid, no cess is due and payable by the Company.
For B. Chhawchharia & Co. Chartered Accountants FRN: 305123E CA Aashish Jaiswal Partner Membership No. 66471
Place: Kolkata Date: 15th May, 2013
105

Annexure to the Auditors Report

Referred to in paragraph 1 of our Report of even date
(i)
a) Proper records showing full particulars including quantitative details and situation of fixed assets are being complied by the company. b) According to the information and explanation given to us, all the fixed assets including capital work in progress have not been physically verified by the management during the year but there is a regular program of verification which, in our opinion, is reasonable having regard to the size of the company and nature of its assets. As explained, no material discrepancies were noticed on such verification. c) T h e c o m p a n y h a s n o t disposed substantial part of its fixed assets during the year.
were noticed on physical verification of inventory. (iii) The company has not granted or taken any loan, secured or unsecured, to/from companies, firms or parties covered in the register maintained under section 301 of the Companies Act, 1956. (iv) In our opinion and according to the information and explanations given to us, there are adequate internal control system commensurate with the size of the company and the nature of its business with regard to purchase of inventory and fixed assets and sale of goods. During the course of audit, we have not observed any continuing failure to correct major weakness, if any, in internal control system. (v) a) According to the information and explanations given to us, the particulars of contracts or arrangement referred to in section 301 of the Companies Act, 1956 are being updated in the register required to be maintained under that section. b) In our opinion and according to the information and explanations given to us, the transactions made in pursuance of each contracts or arrangement that need to be entered into the register maintained under Section 301 of the Companies Act, 1956 and aggregating during the year to ` 5,00,000/- or more in respect of each party have been made at prices which are reasonable having regard to the prevailing market
prices at the relevant time. (vi) In our opinion, the company has not accepted any deposits from the public during the year. (vii) In our opinion, the company has a formal internal audit system commensurate with the size of the company and nature of its business. (viii) As informed to us the company is maintaining cost records as prescribed under section 209(1)(d) of the Companies Act, 1956 read with Companies (Cost Accounting records) Rules, 2011, to the extent applicable to the company. We have, however, not made a detailed examination of such records. (ix) In our opinion and according to the information and explanations given to us : a) The company is generally regular in depositing undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, Employees State Insurance, Income Tax, Sales Tax, Wealth Tax, Service Tax, Custom Duty, Excise Duty, Cess and other statutory dues, as applicable, with the appropriate authorities. b) There are no dues of Sales Tax, Income Tax, Customs Tax, Wealth Tax, Service Tax, Custom Duty, Excise Duty and Cess which have not been deposited on account of any dispute except as detailed below:
(ii)
a) According to information and explanation given to us, physical verification of inventory has been conducted by the management at reasonable intervals. b) In our opinion and according to the information and explanation given to us, the procedure of physical verification of inventory followed by the management is reasonable and adequate in relation to the size of the company and the nature of its business. c) The company is maintaining proper records of inventory and no material discrepancies
106


Name of the Statute Central Excise Act, 1944 Central Excise Act, 1944 Central Excise Act, 1944 Central Excise Act, 1944 Central Excise Act, 1944 Central Excise Act, 1944 Central Excise Act, 1944 Central Excise Act, 1944 Central Excise Act, 1944 Central Excise Act, 1944 (x) Nature of Dues Disallowance of Cenvat Credit of Excise Duty Duty demand on scrap on Fabrication of Kiln & Cooler Passage of Illegal Benefit to TISCO Irregular Availment of Service Tax Irregular Availment of Cenvat Credit on inputs/equipments Availment of Cenvat Credit relating to low grade Sponge Iron Availment of Cenvat Credit in respect of bought out Low Grade Sponge Iron Duty demand in respect of scrap arose from fabrication of Kiln & Cooler Availment of Cenvat Credit in respect of bought out Iron Ore Pallet Service Tax on Mutual Fund Distribution (Sub-Brokerage) Amount (` in Lacs) 68.97 69.38 62.21 2.63 83.15 39.09 Relating to the year 2005 - 2006 2006 - 2007 2005 - 2006 2005 - 2006 2006 - 2007 2005 - 2006 Forum where dispute pending CESTAT - Appeal Hearing pending Commissioner of Central Excise CESTAT - Appeal Hearing pending Remand from CESTAT CESTAT Commissioner of Central Excise (Appeal) - Remand from CESTAT Commissioner of Central Excise (Appeal) - Remand from CESTAT CESTAT
30.75
2005 - 2006
6.94
2005 - 2006
78.64
2010 - 2011
CESTAT
50.22
2005 - 2006 and 2006 - 2007
CESTAT - Appeal Hearing pending register maintained under Section 301 of the Companies Act, 1956 during the year under review.
There are no accumulated losses in the company. The company has incurred cash loss during the financial year covered by our audit but has not incurred any cash loss in the immediately preceding financial year. In our opinion and according to the information and explanation given to us, the company has generally not defaulted in repayment of dues to banks. According to the information and explanation given to us, the company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and other securities. The company is not a chit fund or a nidhi mutual benefit fund/society. The company is not dealing in or trading in shares, securities, debentures and other investments. The shares and
other investments are held by the company in its own name. (xv) According to the information and explanations given to us, the company has not given any guarantee for loans taken by others from Banks or Financial Institutions. In our opinion and according to the information and explanations given to us, the term loans have generally been applied for the purpose for which they were obtained.
(xix) (xx)
The company has not issued any debentures during the year. The company has not raised any money by public issue during the year under review. According to the information and explanations given to us and to the best of our knowledge and belief, no fraud on or by the company has been noticed or reported during the year. For B. Chhawchharia & Co. Chartered Accountants FRN: 305123E CA Aashish Jaiswal Partner Membership No. 66471
(xi)
(xvi)
(xxi)
(xii)
(xiii)
(xvii) According to the information and explanations given to us and on an overall examination of the Balance Sheet of the company for the year under review, we report that apparently funds raised on short term basis have not been used for long term investments. (xviii) The company has not made any preferential allotment of shares to parties and companies covered in the
(xiv)
Place: Kolkata Date: 15th May, 2013
107

Balance Sheet as at 31st March, 2013

(Amount in `) Notes EQUITY AND LIABILITIES Shareholders Funds Share Capital Reserves and Surplus Non-current Liabilities Long-term Borrowings Long-term Provisions Current Liabilities Short-term Borrowings Trade Payables Other Current Liabilities Total ASSETS Non-current Assets Fixed Assets Tangible Assets Capital Work-in-Progress Non-current Investments Deferred Tax Assets (Net) Long-term Loans and Advances Current Assets Inventories Trade Receivables Cash and Bank Balances Short-term Loans and Advances Total SIGNIFICANT ACCOUNTING POLICIES AND OTHER NOTES TO ACCOUNTS As at 31st March, 2013 As at 31st March, 2012
1 2 3 4 5 6 7
349,487,270 643,486,779 303,762,987 1,760,000 362,963,417 160,419,527 145,829,715
992,974,049
349,487,270 814,234,401 380,219,208 870,000 354,168,043 194,418,421 114,881,819
1,163,721,671
305,522,987
381,089,208
669,212,659 1,967,709,695
663,468,283 2,208,279,162
8 1,273,997,531 140,387,534 9 10 11 12 13 14 15 25 1,414,385,065 2,686,239 15,669,600 16,864,057 301,883,202 98,346,110 25,080,782 92,794,640 512,501,344 950,912,007 1,463,413,351 2,686,239 (63,259,400) 17,052,507 409,619,268 164,811,110 50,184,929 163,771,158
1,449,604,961
1,419,892,697
518,104,734 1,967,709,695
788,386,465 2,208,279,162
The Notes referred above form an integral part of the accounts. In terms of our report of even date attached herewith
For B. Chhawchharia & Co. Chartered Accountants Firm Reg. No. 305123E CA Aashish Jaiswal Partner Membership No. 66471 Place : Kolkata Date : 15th May, 2013 Aashish Jajodia Wholetime Director
For and on behalf of the Board of Directors Aditya Jajodia Director Jyoti Sharma Company Secretary Sanjiv Jajodia Director
108

Statement of Profit and Loss for the year ended 31st March, 2013
(Amount in `) Notes INCOME Revenue from Operations Less : Excise Duty Other Income EXPENSE Cost of Materials Consumed Manufacturing Expenses Excise Duty on Finished Stock Changes in Inventory Employee Benefits Expense Finance Costs Depreciation Less : Transfer from State Capital Subsidy Prior Period Expenses Other Expenses 2012-13 2011-12
16
260,377,524 26,680,593 233,696,931 6,332,165 240,029,096
1,068,486,455 86,603,332 981,883,123 7,234,948 989,118,071 668,150,165 64,940,729 (1,064,606) 56,052,970 41,621,886 47,386,658 38,519,014 2,769,002 35,750,012 1,116,477 75,433,351 989,387,642 269,571 250,652 1,903,500 2,423,723
17
18 19 20 21 22 73,991,416 2,975,736 23
163,495,663 32,580,468 (8,681,781) 59,153,596 44,168,307 105,529,022 71,015,680 2,682,989 16,786,038 486,729,982
Loss before tax Tax expense : Current Tax Deferred Tax Loss for the year Earning per equity share Basic & Diluted
246,700,886 24 -78,929,000 167,771,886
(4.81)
(0.07)
The Notes referred above form an integral part of the accounts.
In terms of our report of even date attached herewith
For B. Chhawchharia & Co. Chartered Accountants Firm Reg. No. 305123E CA Aashish Jaiswal Partner Membership No. 66471 Place : Kolkata Date : 15th May, 2013 Aashish Jajodia Wholetime Director
For and on behalf of the Board of Directors Aditya Jajodia Director Jyoti Sharma Company Secretary Sanjiv Jajodia Director
109

Cash Flow Statement for the year ended 31st March, 2013
2012-2013 CASH FLOW FROM OPERATING ACTIVITIES : Net Profit/(Loss) before tax and extraordinary items Adjusted for : Depreciation Interest Income Irrecoverable Debts and Advances Written Off Irrecoverable Subsidies Written Off Liabilities no longer required Written Back Interest on Term Loan and Others Prior Period Expenditure (Net) Operating Profit Before Working Capital Changes Movement in Working Capital Sundry Debtors Loans and Advances and other Current Assets Inventories Trade Payables and other payables Cash Generated From Operating Activities Direct Taxes paid/adjusted Net cash from Operating activities (A) CASH FLOW FROM INVESTING ACTIVITIES : Purchase of Fixed Assets Interest Income Net Cash from investing activities (B) CASH FLOW FROM FINANCING ACTIVITIES : Proceeds from long term and other borrowings Issue of shares Dividend Paid Tax on Dividend Paid Interest Paid Net Cash used in Financing Activities (C) NET INCREASE IN CASH AND CASH EQUIVALENTS (A+B+C) CASH AND CASH EQUIVALENTS AT THE BEGINNING OF THE YEAR CASH AND CASH EQUIVALENTS AT THE END OF THE YEAR (246,700,886) 71,015,680 (3,486,252) 921,850 -(296,489) 103,235,681 2,682,989 (72,627,427) 65,543,150 71,210,780 107,736,066 (50,974,302) 120,888,267 -120,888,267 (24,774,680) 3,486,252 (21,288,428) (21,468,305) ---(103,235,681) (124,703,986) (25,104,147) 50,184,929 25,080,782
(Amount in `) 2011-2012 (269,571) 35,750,012 (1,924,265) 13,914,328 45,954,699 (2,237,507) 43,678,096 1,116,477 135,982,269 (2,676,654) 69,309,731 123,461,419 (211,737,301) 114,339,464 (250,652) 114,088,812 (105,147,558) 1,924,265 (103,223,293) 51,679,066 -(3,494,873) (566,957) (43,678,096) 3,939,140 14,804,659 35,380,270 50,184,929
01. Proceeds from long term and other borrowings are shown net of repayment. 02. Cash and Cash equivalents represent cash and bank balances only including Fixed Deposits. In terms of our report of even date attached herewith For B. Chhawchharia & Co. Chartered Accountants Firm Reg. No. 305123E CA Aashish Jaiswal Partner Membership No. 66471 Place : Kolkata Date : 15th May, 2013 Aashish Jajodia Wholetime Director Aditya Jajodia Director Jyoti Sharma Company Secretary Sanjiv Jajodia Director For and on behalf of the Board of Directors
110

Notes to the Financial Statements

As at 31st March, 2013 1. SHARE CAPITAL Authorised : 35,000,000 Equity Shares of ` 10 /- each 500,000 Preference Shares of ` 10/- each Issued, Subscribed & Paid up: 34,948,727 Equity Shares of ` 10/- each fully paid up [Held by M/s. Jai Balaji Industries Limited, the Holding Company] Notes: 1. The details of Shareholders holding more than 5% Equity Shares Name of Shareholder Jai Balaji Industries Ltd. As at 31.03.2013 No. of shares %Holding 34,948,727 100 349,487,270 350,000,000 5,000,000 355,000,000
(Amount in `) As at 31st March, 2012
350,000,000 5,000,000 355,000,000 349,487,270
As at 31.03.2012 No. of shares % Holding 34,948,727 100
2. Terms/rights attached to Equity Shares : The company has only one class of equity shares having a par value of ` 10/- per share. Each holder of equity share is entitled to one vote per share. The company declares and pays dividends in Indian rupees. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting. In the event of liquidation of the company, the holders of equity shares will be entitled to receive remaining assets of the company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders. (Amount in `) As at 31.03.2013 2 RESERVES AND SURPLUS Capital Reserve State Capital Subsidy Less : Allocated to Depreciation General Reserve As per Last Account Transfer to Statement of Profit and Loss Securities Premium Reserve Surplus/(Deficit) in the statement of Profit and Loss : Balance as per last Account Transfer from General Reserve Loss for the year Net Surplus/(Deficit) in the statement of Profit and Loss As at 31.03.2012
38,497,799 2,975,736 35,522,063 373,731,000 (100,000,000) 273,731,000 328,712,548 73,293,054 100,000,000 167,771,886 5,521,168 643,486,779
41,266,801 2,769,002 38,497,799 373,731,000 -373,731,000 328,712,548 75,716,777 -2,423,723 73,293,054 814,234,401 (Amount in `) As at 31.03.2012
As at 31.03.2013 3. LONG-TERM BORROWINGS Secured a) Term Loans From Banks 399,086,368
430,052,208
Terms of Security: i) A Facility Agreement for consortium Term loan has been entered between the Company,referred to as 'Borrower', and Uco Bank, State Bank of India and Axis Bank Ltd. ,collectively referred to as 'Lenders', for the above loan. The loan is secured by way of (i) First mortgage/charge on the entire Fixed Assets, movable and immovable, present and future
111

Notes to the Financial Statements (Contd.)

ranking pari passu amongst the lenders herein (ii) First charge on all the banks accounts of the Company/Project and assignment of all the Companys project contracts and documents ranking pari passu amongst the lenders herein, and (iii) Second charge on all the stock of raw materials, semi-finished and finished goods and receivables, present and future, subservient to prior charge created by the Company in favour of its Working Capital Bankers. ii) The above Loans are guaranteed by three Directors of the Company. Terms of Repayment (Revised): i) Uco Bank - Quarterly Instalments of ` 76.85 lacs each commencing from 31.12.2012 ii) State Bank of India - Quarterly Instalments of ` 57.50 lacs each commencing from 30.09.2012 iii) Axis Bank Ltd. - Quarterly Instalments of ` 57.50 lacs each commencing from 30.9.2012 (Amount in `) As at 31st March, 2013 b. Vehicles Loan - From HDFC Bank Hypothecated against the Vehicle financed by them Terms of Repayment - Under 36 EMI Scheme Less : Current Maturity (Refer Note 7) 1,101,327 As at 31st March, 2012 --
400,187,695 96,424,708 303,762,987
430,052,208 49,833,000 380,219,208 (Amount in `)
As at 31st March, 2013 4. LONG TERM PROVISIONS Provision for Gratuity 1,760,000
As at 31st March, 2012 870,000 (Amount in `)
As at 31st March, 2013 5. SHORT-TERM BORROWINGS Secured Loans Repayable on Demand From Banks - Cash Credit Terms of Security:
As at 31st March, 2012
362,963,417
354,168,043
i) Secured by way of hypothecation of all current assets including stock and book debts, both present and future, ranking pari passu with other banks and second charge on all fixed assets, present and future, ranking pari passu with other banks. ii) The above Loans from banks are guaranteed by three Directors of the Company. As at 31st March, 2013 6. TRADE PAYABLES Sundry Creditors - For Raw Materials - For Capital Goods - For others Acceptances 59,799,338 46,639,751 53,980,438 -160,419,527 75,793,357 49,463,746 44,161,318 25,000,000 194,418,421 (Amount in `) As at 31st March, 2012
112


As at 31st March, 2013 7. OTHER CURRENT LIABILITIES Current maturities of long-term borrowings (As certified by the management) Interest accrued and due on long-term borrowings Advance from customers Due to Holding Company (Interest Free) Other Liabilities 96,424,708 4,673,232 1,971,460 25,816,063 16,944,252 145,829,715
(Amount in `) As at 31st March, 2012 49,833,000 5,072,398 1,048,853 25,108,501 33,819,067 114,881,819
FIXED ASSETS Gross Block As at 1st April, 2012 I. Tangible Assets Freehold Land Building Plant & Machinery Electrical Installations Air Conditioners Generators Furniture & Fixtures Vehicles Office Equipments Computers Total (I) II. Capital Work-in-Progress Land and Site Development Building Plant & Machinery Electrical Installations Furniture & Fixtures Mining Land Railway Sidings Pre-operative Expenses Total (II) Grand Total (I+II) Previous Year Figures 12,694,715 99,972,057 513,421,140 81,402,322 117,043 107,900,695 3,636,082 131,767,953 950,912,007 -(12,694,715) 23,010 (99,995,067) 2,594,449 (516,015,589) 288,783 (81,691,105) -(117,043) 6,777,861 -11,372,696 (121,067,753) 21,056,799 (831,581,272) -----114,678,556 3,636,082 22,072,896 140,387,534 1,744,138,335 -1,719,175,205 ---------255,761,854 -217,242,840 ---------73,991,416 -38,519,014 ---------329,753,270 -255,761,854 6,715,409 89,927,880 596,901,040 43,105,687 917,249 16,677,326 2,045,288 9,031,675 1,802,483 1,139,161 768,263,198 12,694,715 120,084,796 616,245,307 81,906,051 -2,561,721 163,097 1,702,216 108,200 21,500 835,487,603 19,410,124 210,012,676 1,213,146,347 125,011,738 917,249 19,239,047 2,208,385 10,733,891 1,910,683 1,160,661 1,603,750,801 -18,050,790 208,848,962 14,373,444 254,131 4,961,074 1,347,895 6,281,859 676,429 967,270 255,761,854 -6,573,800 59,542,039 5,569,587 43,570 903,520 83,766 1,140,218 87,990 46,926 73,991,416 -24,624,590 268,391,001 19,943,031 297,701 5,864,594 1,431,661 7,422,077 764,419 1,014,196 Additions/ (Adjustments) As at 31st March, 2013 Up to 31st March, 2012 Depreciation For the Year Up to 31st March, 2013
(Amount in `) Net Block As at 31st March, 2013 19,410,124 185,388,086 944,755,346 105,068,707 619,548 13,374,453 776,724 3,311,814 1,146,264 146,465 As at 31st March, 2012 6,715,409 71,877,090 388,052,078 28,732,243 663,118 11,716,252 697,393 2,749,816 1,126,054 171,891 512,501,344 12,694,715 99,972,057 513,421,140 81,402,322 117,043 107,900,695 3,636,082 131,767,953 950,912,007 --1,463,413,351
329,753,270 1,273,997,531 -----114,678,556 3,636,082 22,072,896 140,387,534 1,414,385,065 ---
1,719,175,205 856,544,402 -- (831,581,272) 1,612,440,221 106,734,984
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9. NON-CURRENT INVESTMENTS Face Value
`
(Amount in `) No. of shares As at 31.03.2013

`
No. of shares
As at 31.03.2012
`
Others In fully paid up Equity Shares of Companies Quoted Shyama Infosys Ltd. Shri Nidhi Trading Co. Ltd. Market Value of quoted Investments
10/10/-
366200 10500
2,590,974 95,265 2,686,239 2,756,628
366200 10500
2,590,974 95,265 2,686,239 2,756,628 (Amount in `)
As at March, 2013 10. DEFERRED TAX ASSETS (NET) Deferred Tax Assets on Unabsorbed losses and provisions Employee Benefits Less : Deferred Tax Liability on Fiscal allowance of fixed assets
31st
165,641,500 571,000 150,542,900 15,669,600
22,919,500 282,300 86,461,200 (63,259,400) (Amount in `) As at 31st March, 2012
As at 31st March, 2013 11. LONG TERM LOANS AND ADVANCES (Unsecured, considered good) Capital Advances Deposits
6,295,697 10,568,360 16,864,057
6,484,147 10,568,360 17,052,507 (Amount in `) As at 31st March, 2012
As at 31st March, 2013 12. INVENTORIES (As taken, valued and certified by the management) Raw Materials [Includes stock in transit (*) ` 3,21,17,606/- P.Y. ` 3,21,17,606/-] Finished Goods By Products Stores & Consumables *Awaiting Custom Clearance
245,247,486 583,907 34,853,518 21,198,291 301,883,202 As at 31st March, 2013
296,639,306 79,506,636 15,084,385 18,388,941 409,619,268 (Amount in `) As at 31st March, 2012
13. TRADE RECEIVABLES (Unsecured, considered good) Due for more than six months Other Debts
98,346,110 -98,346,110
160,878,534 3,932,576 164,811,110
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As at 31st March, 2013 14. CASH AND BANK BALANCES (i) Cash & Cash Equivalents Cash-in-hand Balances with Scheduled Banks in Current Account (ii) Other Bank Balances In Fixed Deposits (Pledged) (Maturity after 12 months Rs. 30,00,000/- P. Y. Nil)
(Amount in `) As at 31st March, 2012
4,170,075 1,660,707 5,830,782 19,250,000 25,080,782
1,147,407 16,617,732 17,765,139 32,419,790 50,184,929 (Amount in `)
As at 31st March, 2013 15. SHORT-TERM LOANS AND ADVANCES (Unsecured, considered good) Advances recoverable in cash or in kind or for value to be received Balances with Government Authorities Subsidies Receivable Taxation Advances and Refundable (Net of Provision) MAT Credit Entillement
49,268,464 10,221,278 -2,844,246 30,460,652 92,794,640
83,226,605 12,228,548 35,245,369 2,609,984 30,460,652 163,771,158 (Amount in `) For the year ended 31st March, 2012 927,703,673 61,000,000 79,782,782 1,068,486,455 61,000,000 --61,000,000 25,126,719 54,656,063 79,782,782 (Amount in `)
For the year ended 31st March, 2013 16. REVENUE FROM OPERTIONS Sale of Sponge Iron Sale of Raw Materials Sale of By-Products 222,503,593 28,946,893 8,927,038 260,377,524 --28,946,893 28,946,893 --8,927,038 8,927,038
16.1 SALE OF RAW MATERIAL - Iron Ore - Coal 16.2 SALE OF BY PRODUCTS - Iron Ore fines - Coal fines
For the year ended 31st March, 2013 17. OTHER INCOME Interest on Fixed Deposit Liabilities written back Miscellaneous Income 3,486,252 296,489 2,549,424 6,332,165
For the year ended 31st March, 2012 1,924,265 2,237,507 3,073,176 7,234,948
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For the year ended 31st March, 2013 18. COST OF MATERIALS CONSUMED Raw Material Consumed - Indigeneous - Coal - Iron Ore - Dolomite
(Amount in `) For the year ended 31st March, 2012
80,325,790 83,024,351 145,522 163,495,663
286,581,002 377,936,023 3,633,140 668,150,165 (Amount in `)
For the year ended 31st March, 2013 19. MANUFACTURING EXPENSES Consumption of Stores and Spare parts Power and Fuel Repairs & Maintenance : - For Plant & Machinery - For Others Machinery Hire Charges Processing Charges 2,419,825 16,813,198 3,043,197 577,007 4,758,249 4,968,992 32,580,468
For the year ended 31st March, 2012 7,661,895 35,296,605 7,729,338 790,061 1,331,869 12,130,961 64,940,729 (Amount in `)
For the year ended 31st March, 2013 20. CHANGES IN INVENTORIES Opening Stock : - Finished Goods - By products Less : Closing Stock : - Finished Goods - By products
For the year ended 31st March, 2012
79,506,636 15,084,385 94,591,021 583,907 34,853,518 59,153,596
105,059,344 45,584,647 150,643,991 79,506,636 15,084,385 56,052,970 (Amount in `)
For the year ended 31st March, 2013 21. EMPLOYEE BENEFITS EXPENSE Directors Remuneration Salary, Wages, bonus and allowances Contribution to Provident & Other Funds Staff & Labour welfare expenses 3,764,000 37,460,311 1,798,429 1,145,567 44,168,307
For the year ended 31st March, 2012 -38,384,387 1,692,084 1,545,415 41,621,886
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For the year ended 31st March, 2013 22. FINANCE COSTS Interest : On Term Loans On Others Loan Processing & other financial charges
(Amount in `) For the year ended 31st March, 2012
48,448,490 54,787,191 2,293,341 105,529,022
450,674 43,227,422 3,708,562 47,386,658 (Amount in `) For the year ended 31st March, 2012 1,985,787 621,456 687,103 1,280,117 1,236,324 50,000 4,257,081 2,586,028 515,712 272,893 250,000 50,000 75,000 10,000 1,686,823 45,954,699 13,914,328 75,433,351 (Amount in `)
For the year ended 31st March, 2013 23. OTHER EXPENSES Rent Rates and Taxes Insurance Travelling and Conveyance Legal and Professional expenses Advertisement and Business Promotion Hire Charges Security Guard Charges Telephone, Telex & Fax Printing & Stationary Auditors Remuneration : For Statutory Audit For Internal Audit For Tax Audit For Other Services Miscellaneous expenses Irrecoverable Subsidies written off Irrecoverable debts and advances written off 2,146,200 383,614 860,154 1,375,665 1,574,470 9,390 3,936,424 2,730,464 472,490 106,114 250,000 24,000 75,000 111,500 1,808,703 -921,850 16,786,038
For the year ended 31st March, 2013 24. CURRENT TAX EXPENSES Income Tax Adjustments --
For the year ended 31st March, 2012 250,652
25. NOTES ON ACCOUNTS 1 SIGNIFICANT ACCOUNTING POLICIES SYSTEM OF ACCOUNTING The Company adopts accrual basis of accounting in the preparation of accounts. FIXED ASSETS : Fixed Assets are stated at Cost less depreciation. DEPRECIATION : Depreciation is provided on Straight Line Method in accordance with the provisions of Schedule XIV of the Companies Act, 1956. CAPITAL WORK IN PROGRESS : a) Capital work in progress is stated at cost. b) Construction and other materials purchased for capital addition are treated as consumed. c) Bills of Contractors are adjusted to the extent bills received and settled.
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d) Direct expenses on expansion are capitalized and indirect expenses thereof are shown under Preoperative Expenditure which will be allocated to various items of fixed assets on completion of expansion. INVESTMENTS : Long term investments are carried at acquisition cost and investments intended to be held for less than one year are classified as current investments and are carried at lower of cost and market value. GOVERNMENT GRANTS : a) State Capital Subsidy received on account of fixed assets is credited to Capital Reserve Account out of which Subsidies in relation to depreciable assets are allocated to income over the useful life of the respective assets by deduction from depreciation for the year. b) Grants related to revenue is recognized in the profit & loss account by deduction from the respective expense or shown separately as income. INVENTORIES : Inventories are valued as follows : a) Raw Material, Stores & Consumables Lower of Cost and Net Realisable Value, however, materials and other items held for use in production of inventories are not written down below cost if the finished products in which they will be incorporated are expected to be sold at or above cost. Cost is determined on Weighted Average Basis. Lower of Cost or Net Realisable Value. Cost includes direct materials, labour and Cost of finished goods manufacturing overheads. Cost of Finished Goods include Excise Duty. At Net Realisable Value.
b)
Finished Goods
c)
By Products
SALES : i) Sales include excise duty but excludes sales tax/VAT ii) Revenue from sale of goods is recognized on passing of the title which generally coincides with the delivery of goods. OTHER INCOME : Other Income is accounted on accrual basis except where the receipt of income is uncertain. FOREIGN CURRENCY TRANSACTIONS : Foreign Currency loans are restated at the year end exchange rates or at the rate of forward cover and the resultant difference are charged to Profit and Loss Account. TAXES ON INCOME : i) Current tax is determined as the amount of tax payable in respect of taxable income for the year. ii) Deferred Tax is recognised, subject to consideration of prudence, in respect of Deferred Tax assets/liabilities arising on timing differences, being the difference between taxable income and accounting income that originates in one period and are capable of reversal in one or more subsequent period. EMPLOYEES BENEFITS : i) Short Term employee benefits are charged off at the undiscounted amount in the year in which related service is rendered. ii) Post employment and other long term employee benefits are charged off in the year in which the employee has rendered services. The amount charged off is recognized at the present value of the amounts payable determined using actuarial valuation technique. Actuarial gain and losses in respect of post employment and other long term benefits are charged to the Profit and Loss Account. IMPAIRMENT OF ASSETS : Impairment loss in the value of assets, as specified in Accounting Standard 28 is recognized whenever carrying value of such assets exceeds the market value or value in use, whichever is higher. 2. Estimated amount of the contracts remaining to be executed on capital account and not provided for amounts to ` 387.54 Lacs (` 425.34 Lacs); advance thereagainst ` 62.95 Lacs (` 64.84 Lacs). As at 31.03.2013 (`) 3. Contingent Liability, not provided for, in respect of : Contested demand of : a) Excise Duty b) Service tax As at 31.03.2012
(`)
439.13 lakhs 52.85 lakhs
439.13 lakhs 52.85 lakhs
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4. Certain balance appearing under Sundry Creditors, Advance from Customers, Capital Advances, Trade Receivables and Advance recoverable in cash or in kind or for value to be received, are subject to confirmation. 5. a) As per the information available to the management, no amount is due to SSI and ancilliary units. b) Micro, Small and Medium-Enterprises under the Micro, Small and Medium Enterprises Development Act, 2006 have been determined based on the information available with the Company and the required disclosures are given below : 2013 a. c. Principal amount remaining unpaid as on 31st March Interest paid by the Company in terms of Section 16 of the Micro, Small and Medium Enterprises Development Act, 2006 along with the amount of payment made to the suppliers beyond the appointed day during the period NIL NIL NIL 2012 NIL NIL NIL
b. Interest due thereon as on 31st March
d. Interest due and payable for the period of delay in making payments (which have been paid but beyond the appointed day during the period) but without adding to the interest specified under the Micro, Small and Medium Enterprises Development Act, 2006 e. f. Interest accrued and remaining unpaid as on 31st March Further interest remaining due and payable even in the succeeding years, until such date when the interest dues as above are actually paid to the small enterprises (As certified by the management)
NIL
NIL
NIL NIL
NIL NIL
6. Companys plant was non-operational during the year except for the period 01.05.2012 to 30.05.2012, 17.06.2012 to 30.06.2012, 01.11.2012 to 30.11.2012 and 04.12.2012 to 31.01.2013 due to ongoing major alignment works in the factory and unfavourable market conditions which affected the production substantially. 7. On the basis of physical verification of assets, as specified in Accounting Standard - 28 and cash generation capacity of those assets, in the management perception there is no impairment of such assets as appearing in the balance sheet as on 31.03.2013. 8. The earning per share has been calculated as specified in Accounting Standard 20 on Earnings Per Share issued by ICAI and related disclosures are as below : 2012-2013 (`) a) Amount used as numerator in calculating basic and diluted EPS : Profit/(Loss) after tax (`) b) Weighted average no. of shares used as the denominator in calculating EPS (Nos.) For Basic and Diluted EPS Equity Shares - Opening 34,948,727 34,948,727 (167,771,886) (2,423,723) 2011-2012 (`)
9. In accordance with Accounting Standard 17 Segment Reporting as prescribed under Companies (Accouting Standards) Rules,2006, the Company has determined its business segment as Manufacturing of Sponge Iron. Since there are no other business segments in which the company operates, there are no other primary reportable segments. Therefore, the segment revenue, segment results, segment assets, segment liabilities, total cost incurred to acquire segment assets, depreciation charges are all as is reflected in the financial statements. 10. Related parties and transactions with them as specified in the Accounting Standard 18 on Related Parties Disclosures issued by ICAI has been identified and given below on the basis of information available with the company and the same has been relied upon by the auditors.
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Related Parties & Relationship Transactions a) Enterprises that directly or indirectly through one or more intermediaries, control or controlled by or are under common control with the company (including holding company) : 2012-2013 (`) (I) Holding Company : Jai Balaji Industries Limited Purchases during the year Sales during the year Year end payable (Net) (b) Associates : Jai Balaji Jyoti Steels Limited Sales during the year (c) Individuals owing directly or indirectly, an interest in the voting power of the company that gives control or significant influence over the company and relatives of any such individual. NIL (d) Key Management personnel and their relatives : Shri Aashish Jajodia Whole time Director Remuneration (e) Enterprises over which any person described in (c) or (d) is NIL able to exerciese significant influence over the company and relatives of any such individual. (f) Amount written off in respect of above parties : NIL 11. Expenditure in Foreign Currency Travelling Expenses 297158/- (P.Y. Nil) 2011-2012 (`)
-263,322,911 25,816,063 --
634,239 900,826,797 25,108,501 139,343
4,200,000
4,200,000
12. The disclosure required under Accounting Standard -15, Employees Benefit, notified in the Companies (Accounting Standard) Rules, 2006 are given below : I. Expenses recognized in the Statement of Profit & Loss Account for the year ended 31st March, 2013. Gratuity (` in lacs) 2012-13 2011-12 7.68 7.38 2.97 2.30 (2.39) 2.15 0.64 (1.08) --8.90 6.45 Gratuity (` in lacs) As at As a 31st March, 2013 31st March 2012 Present value of Defined Benefits Obligation Fair value of plan assets Less : Unrecognised past serive cost Net liability 47.76 30.16 17.60 -17.60 35.69 26.99 8.70 -8.70
Current service cost Interest cost on benefit obligation Expected return on plan assets Net actuarial loss/(gain) recognised in the year Past Service cost Total Expenses/(Income) II. Net Liability/(Assets) recognized in the Balance Sheet as at 31st March 2013
III. Change in the present value of the defined benefit obligation during the year ended 31st March, 2013 Gratuity (` in lacs) 2012-13 2011-12 Present value of Defined Benefits Obligation at the beginning of the year Current service cost Interest cost on benefit obligation Benefits Paid Net actuarial loss/(gain) recognised in the year Current service cost Present value of Defined Benefits Obligation at the end of the year 35.69 7.68 2.97 (0.44) 1.86 -47.76 28.04 7.38 2.30 (0.61) (1.42) -35.69
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IV. Change in the Fair Value of Plan Assets during the year ended 31st March, 2013 : Gratuity (` in lacs) 2012-13 Fair value of Defined Benefits Obligation at the beginning of the year Expected return Interest cost on benefit obligation Contribution by Employer Benefits paid Actuarial Gains/(Losses) Present value of Defined Benefits Obligation at the end of the year V. The major categories of plan assets as a percentage of the fair value of the total plan assets Gratuity (` in lacs) 2012-13 2011-12 Investment with the insurer 100% 100% 26.99 2.39 --(0.44) 1.22 30.16 2011-12 22.64 2.15 3.15 0.61 -(0.34) 26.99
VI. The principal assumptions used in determining gratuity and leave obligations for the Companys plans are shown below. Gratuity (` in lacs) 2012-13 2011-12 Discount Rate (per annum) compounded Expected Return on Assets Rate of escalation in salary (per annum) Mortality Table VII. Amounts for the current and previous year are as follows : Gratuity (` in lacs) 2012-13 2011-12 Defined Benefits Obligation Plan Assets Surplus/(Deficit) Experience Gain/(Loss) Adjustments on plan liabilities Experience Gain/(Loss) Adjustments on plan assets (47.76) 30.16 (17.60) (1.86) -(` in lacs) 2012-13 Contribution to Provident Fund 13. a) Previous year figures above are indicated in brackets. b) Previous year figure have been regrouped/rearranged, wherever found necessary. Signature to notes 1 to 25 For B. Chhawchharia & Co. Chartered Accountants Firm Reg. No. 305123E CA Aashish Jaiswal Partner Membership No. 66471 Place : Kolkata Date : 15th May, 2013 For and on behalf of the Board of Directors Aashish Jajodia Wholetime Director Aditya Jajodia Director Jyoti Sharma Company Secretary Sanjiv Jajodia Director 16.44 (35.69) 26.99 (8.70) 1.42 -8.20% 9.00% 7.50% 8.70% 9.00% 7.50%
LIC (1994-96) ultimate
2011-12 13.77
121
Jai Balaji Steels (Purulia) Limited

Directors Report
To the Members of M/s. Jai Balaji Steels (Purulia) Limited
Your Directors have the pleasure in presenting the third Annual Report of your Company for the financial year ended 31st March, 2013. REVIEW OF OPERATION The Company was incorporated on the 1st day of November, 2010. It did not commence its commercial activities till 31st March, 2013 and hence the Statement of Profit & Loss was not prepared for the said period ending 31st March, 2013. HOLDING COMPANY The company is a wholly owned subsidiary of M/s. Jai Balaji Industries Limited since its inception, i.e. 1st November, 2010. DIRECTORS Shri Rajiv Jajodia, Director of the Company retire by rotation at the ensuing Annual General Meeting of the Company and being eligible, offers himself for re-appointment. AUDITORS M/s. Rashmi & Co., Chartered Accountants, the Statutory Auditors of your Company, retire at the conclusion of the ensuing Annual General Meeting and being eligible, offers themselves for re-appointment. They have furnished to the Company a Certificate
in accordance with sub-section (1B) of Section 224 of the Companies Act, 1956. The observations of Auditors in their Report read with relevant Accounting Policies and notes to accounts in Note no.1 are self explanatory and do not require further explanation. DIRECTORS RESPONSIBILITY STATEMENT Pursuant to section 217 (2AA) of the Companies Act, 1956, your Directors confirm that: i) In the preparation of annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures.
detecting fraud and other irregularities; and iv) The annual accounts have been prepared on a going concern basis. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO Particulars with regard to Conservation of Energy, Technology Absorption, Foreign Exchange Earnings and Outgo in accordance with the provisions of Section 217(1) (e) of the Companies Act, 1956 read with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988 are at present not applicable to the Company. PARTICULARS OF EMPLOYEES The Company has no employee getting remuneration as prescribed under Section 217(2A) of the Companies Act, 1956 read with Companies (Particulars of Employees) Rules, 1975 during the year under review. ACKNOWLEDGEMENT Your Directors wish to express their sincere appreciation for the valuable trust, co-operation and support extended by all stakeholders.
ii) T h e y h a v e s e l e c t e d s u c h 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 as at 31st March, 2012. iii) They have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the Company and for preventing and
For and on behalf of the Board Place : Kolkata Date : 26th July, 2013
Sanjiv Jajodia Director
Rajiv Jajodia Director
122

Auditors Report
To the Members of Jai Balaji Steels (Purulia) Limited
REPORT ON THE FINANCIAL STATEMENTS We have audited the accompanying financial statements of Jai Balaji Steels (Purulia) Limited (the Company), which comprise the Balance Sheet as at March 31, 2013, and no Profit and Loss has been prepared since the company has not commenced commercial production, and a summary of significant accounting policies and other explanatory information. MANAGEMENTS RESPONSIBILITY FOR THE FINANCIAL STATEMENTS Management is responsible for the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the Accounting Principles generally accepted in India including Accounting Standards referred to in subsection (3C) of section 211 of the Companies Act, 1956 (the Act). This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error. AUDITORS RESPONSIBILITY Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with the Standards on Auditing issued by the Institute of Chartered Accountants of India. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures
in the financial statements. The procedures selected depend on the auditors judgement, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the Companys preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion. OPINION In our opinion and to the best of our information and according to the explanations given to us, the aforesaid financial statements give the information required by the Act 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 the Balance Sheet, of the state of affairs of the Company as at March 31, 2013; REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS 1. As required by the Companies (Auditors Report) Order, 2003 issued by the Central Government of India in terms of Section 227(4A) of the Act 1956, we give in the Annexure, a statement on the matters specified in paragraphs 4 and 5 of the order. 2. As required by section 227(3) of the Act, we report that: a. 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. b. In our opinion proper books of account as required by law have been kept by the Company so far as appears from our examination of those books. c. The Balance Sheet dealt with by this Report is in agreement with the books of account. d. In our opinion, the Balance Sheet comply with the Accounting Standards referred to in subsection (3C) of section 211 of the Companies Act, 1956. e. On the basis of written representations received from the directors as on March 31, 2013, and taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2013, from being appointed as a director in terms of clause (g) of sub-section (1) of section 274 of the Companies Act, 1956. f. Since the Central Government has not issued any notification as to the rate at which the cess is to be paid under section 441A of the Companies Act, 1956 nor has it issued any rules under the said section, prescribing the manner in which such cess is to be paid, no cess is due and payable by the Company.
For Rashmi & Co. Chartered Accountants FRN: 309122E CA Sandeep Agarwal (Partner) Membership No. 065643 Place : Kolkata Date :10th May, 2013
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Jai Balaji Steels (Purulia) Limited (Referred to in paragraph 1 under the heading of Report on Other Legal and Regulatory Requirements of our report for period ended 31st March, 2013) 1) The Company does not have any fixed assets. Hence clause (1) of the order is not applicable. Since the Company has no inventory hence the provision of the clause 4(ii) of the order relating to inventory is not applicable. The Company has neither granted nor taken any loans, secured or unsecured to and from companies, firms or other parties as covered in the register maintained under section 301 of the Companies Act, 1956. Accordingly the provisions of clause 4 (iii) (b) to (d), (f) & (g) of the Order are not applicable. In our opinion and according to the information and explanations given to us there exists an adequate internal control system commensurate with the size of the Company and the nature of its business with regard to purchases of fixed assets etc. During the year we have not observed any continuing failure to correct major weakness in internal control system of the Company. No contracts need to be entered into the resgister maintained under section 301 of the Act. Hence our comments are not applicable. The Company has not accepted any deposits from the public to which the provisions of section 58A & 58AA or any other relevant provisions of the Companies Act, 1956 and the rules framed there under, hence provisions of clause 4(iv) of the Order is not applicable. 7) Since the Company has not started the commercial production and profit and loss account has not been prepared, the provisions of clause 4(x) of the Order is not applicable. According to the information and explanations given to us, the company does not have any dues payable to the financial institution, banks and debentures holders. Accordingly provision of the clause 4(xi) of the order is not applicable. According to the information and explanation given to us, the Company has not granted any loan and advances on the basis of the security by way of pledge of shares, debentures and other securities. overall examination of the Balance Sheet of the Company we report that no funds raised on short term basis have been used for long term investment. 15) According to the information and explanations given to us, the Company has not made any preferential allotment of shares during the year to any parties or companies covered in the register maintained under section 301 of the Companies Act, 1956. 16) On the basis of information and explanations given to us, the Company has not issued debentures during the year. 17) The Company has not raised money through a public issue during the year. 18) According to the information and explanations given to us, no fraud on or by the company has been noticed or reported during the course of our audit. 19) No matters specified in the Order are applicable to the Company.
2)
8)
3)
9)
4)
10) The Company is not a chit fund or a nidhi / mutual benefit fund/ society, therefore the provisions of clause 4(xiii) of the said order are not applicable to the Company. 11) The Company does not deal or trade in shares, securities, debentures and other investments, hence, the provision of clause 4(xiv) is not applicable. 12) According to the information and explanation given to us, the Company has not given any guarantee for loans taken by others from bank or financial institutions. 13) On the basis of information and explanations given to us, no term loans were raised during the year by the Company. 14) According to the information and explanation given to us and on
5)
6)
124

Balance Sheet as at 31st March 2013

Note No. EQUITY AND LIABILITIES Shareholders Funds Share Capital Current Liabilities Other Current Liabilities 2 500,000.00 500,000.00 3 12,736.00 12,736.00 TOTAL ASSETS Non Current Assets Capital Work In Progress Other Non - Current Assets 4 5 58,516.00 220,149.00 278,665.00 Current Assets Cash and Bank Balance 6 234,071.00 234,071.00 TOTAL Significant Accounting Policies & Notes to the Accounts 1 512,736.00 512,736.00 As at 31st March, 2013
(in `) As at 31st March, 2012
500,000.00 500,000.00 18,143.00 18,143.00 518,143.00
37,458.00 220,149.00 257,607.00
260,536.00 260,536.00 518,143.00
The notes referred above form an integeral part of the Accounts.
Audit Report as on even date attached For Rashmi & Co. Chartered Accountants Firm Reg. No : 309122E CA Sandeep Agarwal Partner Membership No. 065643 Place : Kolkata Date : 10th May, 2013
125

Notes to Financial Statements for the year ended 31st March, 2013
The previous year figures have been regrouped / reclassified, wherever necessary to confirm to the current year presentation. Note No. 2: Share Capital As at 31st March, 2013 Authorised : 2,000,000 (2,000,000) Equity shares of ` 10/- each Issued : 50,000 (50,000) Equity shares of ` 10/- each Subscribed and paid-up : 50,000 (50,000) Equity shares of ` 10/- each Paid up Share Capital 500,000.00 500,000.00 500,000.00 500,000.00 500,000.00 500,000.00 20,000,000.00 20,000,000.00 (in `) As at 31st March, 2012
Reconciliation of the Shares outstanding at the beginning and at the end of the reporting period Equity Shares As at 31st March, 2013 No. of Shares Number of Shares outstanding at the beginning of the period Number of Shares outstanding at the end of year 50,000 50,000 Amount 500,000.00 500,000.00 As at 31st March, 2012 No. of Shares 50,000 50,000 Amount 500,000.00 500,000.00 (in `)
Terms/rights attached to equity shares The Company has only one class of ordinary shares (equity shares) having at par value of ` 10/- each. Each shareholders of ordinary shares (equity shareholders) is entitled to one vote per share. The company declared and pays dividend in Indian Rupees. The dividend proposed by the Board of Directors is subject to approval of the shareholders in the ensuing annual general meeting except in the case of interim dividend. In the event of liquidation, the equity shareholders are eligible to receive the remaining assets of the Company after distributions of preferential amounts in the proportions to their share holdings. Equity shareholders holding 5% or more shares by Holding/Ultimate holding company and/or their subsidiaries/associates (in `) Name Relation As at 31st March, 2013 No. of Shares Jai Balaji Industries Limited Aggregate No. of Shares : Holding Company 50,000 50,000 % 100 100 As at 31st March, 2012 No. of Shares 50,000 50,000 % 100 100
126


Note No. 3: Other Current Liabilities As at 31st March, 2013 Professional Tax Audit Fees Payable Other Liabilities Total -5,618.00 7,118.00 12,736.00 (in `) As at 31st March, 2012 -5,618.00 12,525.00 18,143.00
Note No. 4: Capital Work In Progress As at 31st March, 2013 Opening Balance Addition Audit Fees Bank Charges Filing Fees General Expenses Interest on Professional Tax (Co) Professional Charges Professional Tax Total 37,458.00 11,236.00 204.00 500.00 --6,618.00 2,500.00 58,516.00
(in `) As at 31st March, 2012 8,315.00 5,618.00 -13,500.00 610.00 150.00 6,765.00 2,500.00 37,458.00
Note No. 5: Other Non Current Assets As at 31st March, 2013 Unamortized Expenses Total 220,149.00 220,149.00
(in `) As at 31st March, 2012 220,149.00 220,149.00
Note No. 6: Cash and Bank Balance As at 31st March, 2013 Cash and Cash equivalents Cash in hand Balance with Banks On Current Account Total 232,065.00 234,071.00 2,006.00
4,506.00 256,030.00 260,536.00
127

Note 1" : Accounting Policies & Notes on Accounts A. SIGNIFICANT ACCOUNTING POLICIES 1. General : The Financial Statements have been prepared under historical cost convention in accordance with the generally accepted accounting principles in accordance with the Accounting Standards issued by The Institute of Chartered Accountants of India and the provisions of the Companies Act, 1956 are consistently adopted by the Company. The Company follows mercantile system of accounting. 2. 3. 4. Other Current Assets : All Current Assets are valued at prices not more than its realizable value. Preliminary Expenses : Preliminary Expenses will be written off in the year of start of Commercial operations. Pre-operative Expenses : Pre-operative expenditure is carried forward as expenditure during construction period pending allocation and will be allocated to fixed assets on commencement of commercial production. 5. 6. Contingent Liabilities are not provided for and are disclosed by way of a note. As the operations have not yet commenced, the accounting policies which are specific in nature have not been disclosed.
B. NOTES ON ACCOUNTS 1. 2. 3. In opinion of the Board, Current Assets, Loans & Advances have a value on realization in the ordinary course of business at least equal to the amount at which they are stated and provision for all known liabilities has been made. As the Company not commenced commercial operations, no Profit & Loss Account for the current period has been prepared. The Company has become 100% subsidiary to Jai Balaji Industries Ltd. with effect from 01.11.2010 by acquiring the entire equity. (in `) As at March 31st 2013 11,236.00 As at March 31st 2012 5,618.00
4. Payment to Auditors Auditors Remuneration Audit Fees
5. Previous year figures have been regrouped or rearranged whenever necessary.
Signature to Notes 1 to 6 In terms of Our Separate Report of even date attached. For Rashmi & Co. Chartered Accountants Firm Reg. No : 309122E CA Sandeep Agarwal Partner Membership No. 065643 Place : Kolkata Date : 10th May, 2013
128
Jai Balaji Energy (Purulia) Limited

Directors Report
To the Members of M/s. Jai Balaji Energy (Purulia) Limited
Your Directors are pleased to present the third Annual Report of your Company for the financial year ended 31st March, 2013. REVIEW OF OPERATION The Company was incorporated on the 1st day of November, 2010. It did not commence its commercial production till 31st March, 2013 and hence the Statement of Profit & Loss was not prepared for the said period ending 31st March, 2013. HOLDING COMPANY The company is a wholly owned subsidiary of M/s. Jai Balaji Industries Limited since its inception, i.e. 1st November, 2010. DIRECTORS Shri Rajiv Jajodia, Director of the Company retire by rotation at the ensuing Annual General Meeting of the Company and being eligible, offers himself for re-appointment. AUDITORS M/s. Rashmi & Co., Chartered Accountants, the Statutory Auditors of your Company, retire at the conclusion of the ensuing Annual General Meeting and being eligible, offers themselves for re-appointment. They have furnished to the Company a Certificate
in accordance with sub-section (1B) of Section 224 of the Companies Act, 1956. The observations of Auditors in their Report read with relevant Accounting Policies and notes to accounts in Note no.1 are self explanatory and do not require further explanation. DIRECTORS RESPONSIBILITY STATEMENT Pursuant to section 217 (2AA) of the Companies Act, 1956, your Directors confirm that: i) In the preparation of annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures.
Company and for preventing and detecting fraud and other irregularities; and iv) The annual accounts have been prepared on a going concern basis. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO Particulars in respect of Conservation of Energy, Technology Absorption, Foreign Exchange Earnings and Outgo in accordance with the provisions of Section 217(1) (e) of the Companies Act, 1956 read with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988 are at present not applicable to the Company. PARTICULARS OF EMPLOYEES The Company has no employee getting remuneration as prescribed under Section 217(2A) of the Companies Act, 1956 read with Companies (Particulars of Employees) Rules, 1975 during the year under review. ACKNOWLEDGEMENT Your Directors wish to express their sincere appreciation for the valuable trust, co-operation and support extended by all stakeholders.
ii) T h e y h a v e s e l e c t e d s u c h 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 as at 31st March, 2013. iii) They have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the
For and on behalf of the Board
Place : Kolkata Date : 26th July, 2013
129

Auditors Report
To the Members of Jai Balaji Energy (Purulia) Limited
REPORT ON THE FINANCIAL STATEMENTS We have audited the accompanying financial statements of Jai Balaji Energy (Purulia) Limited (the Company), which comprise the Balance Sheet as at March 31, 2013, and no Profit and Loss has been prepared since the company has not commenced commercial production, and a summary of significant accounting policies and other explanatory information. MANAGEMENTS RESPONSIBILITY FOR THE FINANCIAL STATEMENTS Management is responsible for the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the Accounting Principles generally accepted in India including Accounting Standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956 (the Act). This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error. AUDITORS RESPONSIBILITY Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with the Standards on Auditing issued by the Institute of Chartered Accountants of India. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures
in the financial statements. The procedures selected depend on the auditors judgement, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the Companys preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion. OPINION In our opinion and to the best of our information and according to the explanations given to us, the aforesaid financial statements give the information required by the Act 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 the Balance Sheet, of the state of affairs of the Company as at March 31, 2013; REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS 1. As required by the Companies (Auditors Report) Order, 2003 issued by the Central Government of India in terms of Section 227(4A) of the Act 1956, we give in the Annexure, a statement on the matters specified in paragraph 4 and 5 of the order. 2. As required by section 227(3) of the Act, we report that: a. 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. b. In our opinion proper books of account as required by law have been kept by the Company so far as appears from our examination of those books. c. The Balance Sheet dealt with by this Report is in agreement with the books of account. d. In our opinion, the Balance Sheet comply with the Accounting Standards referred to in subsection (3C) of section 211 of the Companies Act, 1956. e. On the basis of written representations received from the directors as on March 31, 2013, and taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2013, from being appointed as a director in terms of clause (g) of sub-section (1) of section 274 of the Companies Act, 1956. f. Since the Central Government has not issued any notification as to the rate at which the cess is to be paid under section 441A of the Companies Act, 1956 nor has it issued any rules under the said section, prescribing the manner in which such cess is to be paid, no cess is due and payable by the Company.
130


Jai Balaji Energy (Purulia) Limited (Referred to in paragraph 1 under the heading of Report on Other Legal and Regulatory Requirements of our report for period ended 31st March, 2013)
1)
The Company does not have any fixed assets. Hence clause (1) of the order is not applicable. Since the Company has no inventory hence the provision of the clause 4(ii) of the order relating to inventory is not applicable. The Company has neither granted nor taken any loans, secured or unsecured to and from companies, firms or other parties as covered in the register maintained under section 301 of the Companies Act, 1956. Accordingly the provisions of clause 4 (iii) (b) to (d), (f) & (g) of the Order are not applicable. In our opinion and according to the information and explanations given to us there exists an adequate internal control system commensurate with the size of the Company and the nature of its business with regard to purchases of fixed assets etc. During the year we have not observed any continuing failure to correct major weakness in internal control system of the Company. No contracts need to be entered into the resgister maintained under section 301 of the Act. Hence our comments are not applicable. The Company has not accepted any deposits from the public to which the provisions of section 58A & 58AA or any other relevant provisions of the Companies Act, 1956 and the rules framed there under, hence provisions of clause 4(iv) of the Order is not applicable. Since the Company has not started the commercial production and 8)
2)
profit and loss account has not been prepared, the provisions of clause 4(x) of the Order is not applicable. According to the information and explanations given to us, the company does not have any dues payable to the financial institution, banks and debentures holders. Accordingly provision of the clause 4(xi) of the order is not applicable. According to the information and explanation given to us, the Company has not granted any loan and advances on the basis of the security by way of pledge of shares, debentures and other securities.
basis have been used for long term investment. 15) According to the information and explanations given to us, the Company has not made any preferential allotment of shares during the year to any parties or companies covered in the register maintained under section 301 of the Companies Act, 1956. 16) On the basis of information and explanations given to us, the Company has not issued debentures during the year. 17) The Company has not raised money through a public issue during the year. 18) According to the information and explanations given to us, no fraud on or by the company has been noticed or reported during the course of our audit. 19) No matters specified in the Order are applicable to the Company.
3)
9)
4)
10) The Company is not a chit fund or a nidhi/mutual benefit fund/ society, therefore the provisions of clause 4 (xiii) of the said order are not applicable to the Company. 11) The Company does not deal or trade in shares, securities, debentures and other investments, hence, the provision of clause 4(xiv) is not applicable. 12) According to the information and explanation given to us, the Company has not given any guarantee for loans taken by others from bank or financial institutions. 13) On the basis of information and explanations given to us, no term loans were raised during the year by the Company. 14) According to the information and explanation given to us and on overall examination of the Balance Sheet of the Company we report that no funds raised on short term
5)
6)
For Rashmi & Co. Chartered Accountants FRN: 309122E CA. Sandeep Agarwal (Partner) Membership No. 065643
7)
Place : Kolkata Date :10th May, 2013
131

Balance Sheet as at 31st March 2013

Note No. EQUITY AND LIABILITIES Shareholders Funds Share Capital Current Liabilities Other Current Liabilities 2 500,000.00 500,000.00 3 11,736.00 11,736.00 TOTAL ASSETS Non Current Assets Capital Work In Progress Other Non - Current Assets 4 5 58,366.00 220,149.00 278,515.00 Current Assets Cash and Bank Balance 6 233,221.00 233,221.00 TOTAL Significant Accounting Policies & Notes to the Accounts 1 511,736.00 511,736.00 As at 31st March, 2013
500,000.00 500,000.00 18,143.00 18,143.00 518,143.00
37,308.00 220,149.00 257,457.00
260,686.00 260,686.00 518,143.00
The notes referred above form an integeral part of the Accounts.
Audit Report as on even date attached. For Rashmi & Co. Chartered Accountants FRN: 309122E CA Sandeep Agarwal Partner Membership No. 065643 Place : Kolkata Date : 10th May, 2013 For and on behalf of the Board of Directors
132

The previous year figures have been regrouped / reclassified, wherever necessary to confirm to the current year presentation. Note No. 2: Share Capital As at 31st March, 2013 Authorised : 2,000,000 (2,000,000) Equity shares of ` 10/- each Issued : 50,000 (50,000) Equity shares of ` 10/- each Subscribed and paid-up : 50,000 (50,000) Equity shares of ` 10/- each Paid up Share Capital 500,000.00 500,000.00 500,000.00 500,000.00 500,000.00 500,000.00 20,000,000.00 20,000,000.00 (in ` ) As at 31st March, 2012
Reconciliation of the Shares outstanding at the beginning and at the end of the reporting period Equity Shares As at 31st March, 2013 No. of Shares Number of Shares outstanding at the beginning of the period Number of Shares outstanding at the end of year 50,000.00 50,000.00 Amount 500,000.00 500,000.00 As at 31st March, 2012 No. of Shares 50,000.00 50,000.00 Amount 500,000.00 500,000.00 (in `)
Terms/rights attached to equity shares The Company has only one class of ordinary shares (equity shares) having at par value of ` 10/- each. Each shareholders of ordinary shares (equity shareholders) is entitled to one vote per share. The company declared and pays dividend in Indian Rupees. The dividend proposed by the Board of Directors is subject to approval of the shareholders in the ensuing annual general meeting except in the case of interim dividend. In the event of liquidation, the equity shareholders are eligible to receive the remaining assets of the Company after distributions of preferential amounts in the proportions to their share holdings. Equity shareholders holding 5% or more shares by Holding / Ultimate holding company and / or their subsidiaries/ associates Name Relation As at 31st March, 2013 No. of Shares Jai Balaji Industries Limited Aggregate No. of Shares : Holding Company 50,000 50,000 % 100 100 As at 31st March, 2012 No. of Shares 50,000 50,000 % 100 100
133

Note No. 3: Other Current Liabilities As at 31st March, 2013 Professional Tax Audit Fees Payable Other Liabilities Total -5,618.00 6,118.00 11,736.00 (in `) As at 31st March, 2012 -5,618.00 12,525.00 18,143.00
Note No. 4: Capital Work In Progress As at 31st March, 2013 Opening Balance Addition Audit Fees Bank Charges Filing Fees General Expenses Interest on Professional Tax (Co) Professional Charges Professional Tax Total 37,308.00 11,236.00 204.00 500.00 --6,618.00 2,500.00 58,366.00
(in `) As at 31st March, 2012 8,315.00 5,618.00 100.00 13,500.00 610.00 150.00 6,515.00 2,500.00 37,308.00
Note No. 5: Other Non Current Assets As at 31st March, 2013 Unamortized Expenses Total 220,149.00 220,149.00
(in `) As at 31st March, 2012 220,149.00 220,149.00
Note No. 6: Cash and Bank Balance As at 31st March, 2013 Cash and Cash equivalents Cash in hand Balance with Banks On Current Account Total 231,215.00 233,221.00 2,006.00
(in `) As at 31st March, 2012 4,506.00 256,180.00 260,686.00
134

Note 1" : Accounting Policies & Notes on Accounts A. SIGNIFICANT ACCOUNTING POLICIES 1. General : The Financial Statements have been prepared under historical cost convention in accordance with the generally accepted accounting principles in accordance with the Accounting Standards issued by The Institute of Chartered Accountants of India and the provisions of the Companies Act 1956 are consistently adopted by the Company. The Company follows mercantile system of accounting. 2. 3. 4. Other Current Assets All Current Assets are valued at prices not more than its realizable value. Preliminary Expenses: Preliminary Expenses will be written off in the year of start of Commercial operations. Pre-operative Expenses:Pre-operative expenditure is carried forward as expenditure during construction period pending allocation and will be allocated to fixed assets on commencement of commercial production. 5. 6. Contingent Liabilities are not provided for and are disclosed by way of a note. As the operations have not yet commenced, the accounting policies which are specific in nature have not been disclosed.
B. NOTES ON ACCOUNTS 1. 2. 3. In opinion of the Board, Current Assets, Loans & Advances have a value on realization in the ordinary course of business at least equal to the amount at which they are stated and provision for all known liabilities has been made. As the Company not commenced commercial operations, no Profit & Loss Account for the current period has been prepared. The Company has become 100% subsidiary to Jai Balaji Industries Ltd. with effect from 01.11.2010 by acquiring the entire equity. (in `) As at March 31st 2013 11,236.00 As at March 31st 2012 5,618.00
4. Payment to Auditors Auditors Remuneration Audit Fees
5. Previous year figures have been regrouped or rearranged whenever necessary.
Signature to Notes 1 to 6 In terms of our Separate Report of even date attached. For Rashmi & Co. Chartered Accountants FRN: 309122E CA Sandeep Agarwal Partner Membership No. 065643 Place : Kolkata Date : 10th May, 2013 For and on behalf of the Board of Directors
135
NOTES:

Registered Office : 5, Bentinck Street, 1st Floor, Kolkata - 700 001
ATTENDANCE SLIP
Please fill the attendance slip and hand it over at the entrance of the meeting hall DP ID Regd. Folio No.* NAME AND ADDRESS OF THE SHAREHOLDER : Client ID No. of shares
I hereby record my presence at the Fourteenth Annual General Meeting of the Company being held on Thursday, the 12th September, 2013 at 11:00 A.M. at Rotary Sadan (Shripati Singhania Hall), 94/2 Chowringhee Road, Kolkata 700 020. Please ( ) in the box MEMBER ................................................... Members Signature *Applicable for investors holding shares in physical form. PROXY ................................................... Proxys Signature

Registered Office : 5, Bentinck Street, 1st Floor, Kolkata - 700 001
PROXY FORM
DP ID Regd. Folio No.* Client ID No. of shares
I/We ........................................................................................ of ..................................................................................................................in the district of ...................................................................... being a member/members of Jai Balaji Industries Limited, hereby appoint ................................................................................................... of ........................................................................................in the district of ................................................................................................ or failing him/her .......................................................................................of ................................................................................................ in the district of ................................................... as my/our Proxy to attend and vote for me/us on my/our behalf at the Fourteenth Annual General Meeting of the Company being held on Thursday, the 12th September, 2013 at 11:00 A.M. and at any adjournment thereof.
Signed this .............................................. day of ........................................ 2013.
Signature ...................................................................................... *Applicable for investors holding shares in physical form. Note : The Proxy form duly completed and signed should be deposited at the Registered Office of the Company, not less than 48 hours before the time for holding the aforesaid meeting.

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Jai Balaji Industries Limited

Annual Report 2012-13

Notice to the Shareholders

Jai Balaji Industries Limited

Notice to the Shareholders (Contd.)

31.03.2006 31.03.2007 31.03.2008 31.03.2009 31.03.2010 31.03.2011

23.09.2006 27.09.2007 08.09.2008 15.09.2009 22.09.2010 21.09.2011

Jai Balaji Industries Limited

Annexure to the Notice

Jai Balaji Industries Limited

Annexure to the Notice (Contd.)

2) Past Remuneration 3) Recognition or awards 4) Job profile and his suitability

Jai Balaji Industries Limited

Annexure to the Notice (Contd.)

Jai Balaji Industries Limited

Annexure to the Notice (Contd.)

Expertise in Specific functional area

Banking and Finance

Directorship held in other Public Companies

Chairmanship / Membership of the Committees of the Company

Audit Committee - Member

Chairmanship / Membership of Committees across other Public Companies

No. of Equity Shares held in the Company

Jai Balaji Industries Limited

Jai Balaji Industries Limited

Directors Report (Contd.)

Nilachal Iron & Power Limited

A wholly owned subsidiary of your Company since 26.10.2007, having its

Andal East Coal Company Private Limited A Joint Venture Company

Jai Balaji Industries Limited

Directors Report (Contd.)

Jai Balaji Industries Limited

Directors Report (Contd.)

Jai Balaji Industries Limited

Directors Report (Contd.)

Maintaining street lights at nearby villages.

Jai Balaji Industries Limited

Directors Report (Contd.)

Financial assistance for providing water and electricity.

Jai Balaji Industries Limited

Annexure to Directors Report

Jai Balaji Industries Limited

Annexure to Directors Report (Contd.)

2011-12 (fifteen months) 34,069.97 4,540.75

Jai Balaji Industries Limited

Annexure to Directors Report (Contd.)

Improvement in productivity Reduction in wastage Energy conservation measures Safer environment

Jai Balaji Industries Limited

Report of the Directors on Corporate Governance

Yes Yes -Yes Yes Yes ---

Jai Balaji Industries Limited

Report of the Directors on Corporate Governance (Contd.)

Jai Balaji Industries Limited

Report of the Directors on Corporate Governance (Contd.)

Jai Balaji Industries Limited

Report of the Directors on Corporate Governance (Contd.)

No. of meetings attended 2 2 1 2

Benefits/Allowances, etc. (fixed component) NIL NIL 2,70,000 2,70,000