national jute manufactures corporation...

NATIONAL JUTE MANUFACTURES CORPORATION LTD.(A Government of India Undertaking)

35th ANNUAL REPORT2014-15

C O N T E N T S

Sl. No. Description Page No.

1 Notice of Annual General Meeting 1

2 Board of Directors & Other Details 2

3 Directors’ Report 4

4 Auditor’s Certificate on Corporate Governance 14

5 Comments of the Comptroller and Auditor General of India 15

6 Auditors’ Report 16

7 Annexure to Auditors’ Report 19

8 Balance Sheet 25

9 Statement of Profit & Loss 28

10 Cash Flow Statement 29

11 Notes to the Financial Statement 31

NOTICE OF 35th ANNUAL GENERAL MEETING

Notice is hereby given that the 35th Annual General Meeting of the National JuteManufactures Corporation Limited will be held on Wednesday 30th September 2015 at 5.00P.M. at the Registered office of the Corporation, Chartered Bank Buildings, 2nd floor, 4,Netaji Subhas Road, Kolkata 700 001 to transact the following business :

Ordinary Business :

1) To consider and adopt the audited Balance Sheet as at 31st March 2015 and Profit& Loss Account for the year ended 31st March 2015 together with the Reports ofAuditors and Directors and Comments of the Comptroller and Auditor General ofIndia (CAG) thereon.

2) To consider and if thought fit, to pass, with or without modifications, the followingResolution as an Ordinary Resolution.

“RESOLVED that pursuant to provision of Section 139 and other applicableprovisions, if any, of the Companies Act, 2013, M/s Nag & Associates, CharteredAccountants (FRN No. 312063E) be and are hereby appointed as the StatutoryAuditors of the Corporation for the year 2015-16 by the Comptroller & AuditorGeneral of India at a remuneration of Rs. 1,20,000.00 (Rupees One lac twentythousand only) in addition to out of pocket expenses.

By Order of the Board

(Ashok Kumar Mishra) Company Secretary

Registered Office :Chartered Bank Building, 2nd Floor4, N. S. Road, Kolkata-700 001Phone : 033-22307175, Fax : 91-33-22305103E-mail : [email protected] : www.njmc.gov.in

Place: KolkataDated, the 10th September, 2015

Note: A Member entitled to attend and vote at the Meeting is entitled to appoint a Proxy to attendand vote instead of himself and a Proxy need not be a Member.

Proxy in order to be effective should be duly completed and deposited at the RegisteredOffice of the Company, not less than 48 hours before the commencement of the Meeting.

NATIONAL JUTE MANUFACTURES CORPORATION LTD.

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BOARD OF DIRECTORS2014-2015

Chairman-cum-Managing Director :Shri Kushal Bhaduri (From 23.01.2015): Shri Subrata Gupta (From 01.01.2013 to

23.01.2015)Part time Directors : Shri Sujit Gulati (From 15.09.2014 to 03.03.2015)

: Mrs. Babni Lal (From 30.06.2014 to 12.11.2014): Shri Bhagwati Prasad Pandey

(From 12.11.2014 to 02.09.2015): Shri A Madhu Kumar Reddy (From 03.03.2015): Shri Jitendra Kumar Dadoo (From 02.09.2015)

Whole time Director : Shri Yogesh Kumar Garg(From 03.06.2013 to 16.01.2015)

BIFR Nominee Director : Shri Sanjiv Kumar Arora (From 24.04.2014)Company Secretary : Shri Ashok Kumar Mishra (From 01.10.2013)

AUDIT COMMITTEE

Shri Kushal Bhaduri : Member (From 23.01.2015)Shri Subrata Gupta : Member (From 01.01.2013 to 23.01.2015)Shri Sujit Gulati : Member (From 15.09.2014 to 03.03.2015)Mrs. Babni Lal : Member (From 30.06.2014 to 12.11.2014)Shri Yogesh Kumar Garg : Member (From 03.06.2013 to 16.01.2015)Shri Bhagwati Prasad Pandey : Member (From 12.11.2014 to 02.09.2015)Shri A Madhukumar Reddy : Member (From 03.03.2015)Shri Jitendra Kumar Dadoo : Member (From 02.09.2015)Statutory Auditor : Nag & Associates, Chartered Accountants,

2, Chowringhee Approach (1st floor)Kolkata - 700 072

Bankers : Allahabad Bank: UCO Bank: Central Bank of India: Bank of India


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Registered Office : Chartered Bank Buildings, 2nd floor,4, Netaji Subhas Road,Kolkata- 700001.

Mill Units : Alexandra, Jagatdal,North 24-Paraganas, West Bengal

: Khardah , Titagarh,North 24-Paraganas, Titagarh,West Bengal

: Kinnison, TitagarNorth 24-Parganas, Titagarh, West Bengal

: National,Rajgunj, SankrailHowrah, West Bengal

: UnionConvent Lane,Kolkata-700015

: R.B.H.MKatihar, Bihar

Subsidiary Companies : Birds Jute & Exports Limited(Processor of Decorative Fabrics)4, Netaji Subhas Road ,1st Floor,Kolkata-700001.

: Works200, Dakshindari Road (near V.I.P.Road)Kolkata-700048(since 1986)


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DIRECTORS’ REPORTToThe Shareholders,

Gentlemen,

The Directors have pleasure in presenting the 35th Annual Report of your Company together with theaudited accounts for the year ended March 31, 2015.

1. CORPORATE PERFORMANCEThe performance for the financial years 2014-15 and 2013-14 are summarized below:

Sl. No. PARTICULARS 2014-15 2013-14

I Production ( in M.Ton)

II. Revenue from Operations

III Interest Income

IV. Profit / Loss (Rs./Cr.)

Net Loss

Cash Profit / (Loss)

Accumulated Loss

During the year under review, National Jute Manufactures Corporation Limited manufactured sackings(B-Twill Bags) which were supplied to different State food procuring agencies against the ProductionControl Orders issued by the office of Jute Commissioner from time to time.As the Mills were not in operation throughout the year production decreased in comparison to previousyear, the production target as projected in the BIFR revival scheme could not be achieved due to severalfactors discussed subsequently. The revenue from operations was approximately around Rs. Thirty Sevencrores less than previous year figure of Rs. Fifty Eight crores. The cash profit was Rs. One crore twentythree lacs in comparison to cash loss of Rs. Six crores in previous financial year.

2. PERFORMANCE AS COMPARED TO BIFR PROJECTION

The financial year 2014-15 is the 4th year after BIFR approved the revival scheme on 31.3.2011. Duringthe year total production was 6313 MT as against 63500 MT as projected in the revival scheme approved byBIFR. This was principally because the capacity projected in the scheme was not created in the mills. TheCompany believes that there is a great potential in the Indian jute packaging sector and that with increasedFood grain production the demand for jute sacking bags would further strengthen. To cater to the demandfor quality products, the Company will focus on modernization and diversification at the highest level ofIndustrial standard to get the desired productivity. The performance of the Company during the year vis-avis BIFR projection for the 4th year is as follows.

6313

Rs. in Cr.

37.70

20.35

0.49

1.23

304.92

9916

Rs.in Cr.

58.12

17.98

6.55

(6.00)

304.43


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PARTICULARS ACTUAL BIFR PROJECTION

2014-15 4th Year

Production in M.T 6313 63500

Total Revenue (Rs.in Cr.) 58.06 352.74

Interest Income (Rs. in Cr.) 20.35 --

Total Expenditure excluding Depn. (Rs. in Cr.) 58.54 344.17

Cash Profit / (Loss) (Rs. in Cr.) 1.23 8.57

3. PROFIT & LOSS ANALYSISIt will be observed from the Profit & Loss Accounts submitted herewith that the net loss of the Companyhas decreased from Rs.6.55 Cr. in 2013-14 to Rs. 0.49 Cr. in 2014-15 and is within the estimated projectionsas per the BIFR Scheme.The summarized position is presented below:

( Rs. in Crores )

PARTICULARS 2014-15 2013-14

Sales

Other income

TOTAL

Consumption of raw materials and stores

Accretion / Decretion of stock

Power & Fuel

Wages through contractor

Salaries & benefits

VRS Expenditure

Other expenses

Interest

Depreciation

TOTAL

Net Profit/Loss (-)

Cash Profit/Loss (-)

37.70

20.35

58.05

24.28

2.50

3.75

15.72

2.20

-

8.06

0.31

1.72

58.54

0.49

1.23

58.12

17.98

76.10

36.24

1.22

5.24

24.40

1.62

-

13.08

0.30

0.55

82.65

(6.55)

(6.00)


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4. IMPLEMENTATION OF REVIVAL SCHEMEYour Company has successfully implemented and settled major expenditure of the cost of scheme as

detailed hereunder: (Rs in Cr.)

Sl Particulars Cost Total Spending Spent in Cumulative Balance No. fund till 2014-15 Spending

Released 31.03.2014 Upto 31.03.2015

1 2 3 4 5=(3+4) 6=(2-5)

1 VRS Payment for 645.07 645.07 646.41 Nil 646.41 -1.34separation of Workmen /Staffs / Officers(including Arrear DA,Gratuity & Bonus)

2 Payment of liabilities 378.92 378.92 306.87 0.13 307.00 71.92(PF, ESI, secured, unsecured,Sales tax dues and provisionsfor funds) forimplementation

3 O.T.S. to Bank and 58.47 58.47 58.47 Nil 58.47 -financial Institutions

Sub Total 1082.46 1082.46 1011.75 0.13 1011.88 70.58

On A/c. of Soft Loan

1 VRS Payment for separation NIL NIL NIL NIL NIL NILof officers (including Arrear DA,Gratuity & Bonus)

2 Other Creditors NIL NIL NIL NIL NIL NIL

3 Cash loss during 141.45 145.45 126.35 4.43 130.78 14.67implementation period

4 Startup, modernization 215.70 215.70 70.13 6.08 76.21 139.49repair and renovation

Sub total 357.15 361.15 196.48 10.51 206.99 154.16

Grand total 1439.61 1443.61 1208.23 10.64 1218.87 224.74

5. SUBSIDIARY COMPANY - BJELThe company has one subsidiary, namely Bird Jute and Export Limited (BJEL). Due to continuous loss anderosion of net worth the company was declared sick and referred to BIFR in 1999. BIFR has approved theRevival Scheme in its last hearing held on 02.08.2012 at a total cost of Rs. 137.88 crore. The accounts of thesubsidiary company for the financial year ended 31st March 2015 was not finalized and have not beenmerged with the company’s financial statement as on 31st March 2015. The Company has sought for extentionof time for holding of its Annual Genaral Meeting.6. MEMORANDUM OF UNDERSTANDING (MOU)The Task Force fixed various targets under financial, dynamic and sector specific performance for the year2014-15 for your Company and the MOU was signed accordingly with the Ministry of Textiles.


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7. CORPORATE GOVERNANCE7.1 COMPANY PHILOSOPHYNJMC believes that good Corporate Governance is essential to achieve long term corporate goals. NJMC’sphilosophy on Corporate Governance is aimed at the attainment of high level of transparency, accountabilityand compliance of law in all facets of operations, leading to best standards of Corporate Governance.The Company complies with the requirement of Corporate Governance as per Guidelines for CorporateGovernance for Central Public Sector Enterprises, 2010.

7.2 BOARD OF DIRECTORS AS ON 31.03.2015

Name Designation No of Board Board Venue AGMMeeting Meeting of Board

Attended Meeting Attended

Shri Kushal Bhaduri CMD 4 1 Delhi -(Appointed w.e.f. 23.01.2015)Shri B.P. Pandey Govt. Director 4 2 Delhi -(Appointed w.e.f. 12.11.2014)Shri A.M. Reddy Govt. Director 4 1 Delhi -(Appointed w.e.f. 03.03.2015)Shri Sanjiv Arora BIFR Nominee 4 4 Delhi Yes(Appointed w.e.f. 24.04.2014)Shri Subrata Gupta* CMD 4 3 Delhi YesShri Sujit Gulati* Govt. Director 4 2 Delhi YesSmt. Babni Lal* (Appointed w.e.f. 30.06.2014) Govt. Director 4 2 Delhi No

Smt. Monika S. Garg* Appointed w.e.f. 25.08.14) Govt. Director 4 1 Delhi NoShri Yogesh Kumar Garg* Director (Finance) 4 Nil Delhi No

Board Meeting held on : 20th June 2013, 22nd August 2013, 17th December 2013, 27th March 2014.

* Shri Subrata Gupta Resigned from the Board w.e.f. 23rd January 2015.* Shri Sujit Gulati Resigned from the Board w.e.f. 03rd March 2015.* Shri Y.K. Garg discontinued w.e.f. 16th January 2015* Smt. Babni Lal Resigned w.e.f. 12th November 2014* Smt. Monika S. Garg Resigned w.e.f. 15th September 2014

7.3 AUDIT COMMITTEE

The Audit Committee of your Corporation was constituted to follow a good corporate governance practicekeeping in view its basic requirement.The quorum of the Audit Committee is two members. A brief descriptionof the terms of reference of the Audit Committee are

a) Review of the Company’s financial statement and other reports from time to time.

b) Reviewing with the Management and the Auditors the Annual Financial Statements and Reportsbefore submission to the Board, focusing primarily on

i) Any changes in Accounting Polices and Practices;ii) Qualifications and significant adjustment arising out of Audit;iii)Compliance with Accounting Standards;iv) Transactions of material nature involving Management or their relatives, if any.

c) Reviewing with the Management and Auditors, the adequacy of internal control systems, InternalAudit function and frequency of Internal Audit.


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d) Reviewing the Company’s financial and other management polices.

e) To deal with such matter as may be referred to it by the Board in writing or as it considers necessaryin the interest of the Company.

The details of the Audit committee meetings are as follows:

SL. No Name Designation No of Audit Audit CommitteeCommittee Meeting Meeting attended

1 Smt. Babni Lal Govt. Director 1 12 Smt. Monika S. Garg Govt. Director 1 13 Shri Sanjiv Arora Spl. Director (BIFR) 1 14 Shri N.N. Dawn GM (Fin) 1 15 Shri TK Roy, Statutory Auditors 1 1

Shri N Majumdar6 Shri AK Mishra Co. Sec. 1 1

Audit Committee meeting was held on 01st September 2014.

7.4 GENERAL BODY MEETING

2011-12 32nd AGM 2012-13 33rd AGM 2013-14 34th AGM

01 Date 23.11.2012 30.09.2013 26.09.2014

02 Time 2.00 P.M 2.00 P.M 3.00 P.M

03 Venue Registered Office Chartered Registered Office Chartered Registered Office Chartered Bank Buildings,2nd Floor Bank Buildings,2nd Floor Bank Buildings,2nd Floor

4, Netaji Subhash Road 4, Netaji Subhash Road 4, Netaji Subhash Road Kolkata-700001 Kolkata-700001 Kolkata-700001

7.5 DISCLOSURES

i) Disclosures required under the Companies Act, Accounting Standard practice and other Applicable Acts/ Rules.

ii) The requirement as specified in the applicable guidelines have been complied with as far as possible/ applicable to it.

iii) Presidential Directives issued by the Central Government have been complied with.

iv) No expenditure which is personal in nature has been incurred.

7.6 OTHER INFORMATION

i) Board /Audit Committee Meeting and procedureThe information usually placed before the Board includes

a) Confirmation of the Minutes


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b) Action taken report on decisions taken in the Boardc) Performance of the three under revival millsd) Updated status Report on various issuese) Legal Mattersf) Annual Accountsg) Auditors Report including Concurrent Auditors Report.

ii) Agenda for Board/Audit Committee Meetings: On fixation of dates of the Board/Audit CommitteeMeetings, the Agenda papers are prepared and are circulated to the Directors/Members.

iii) Post Meeting Follow up Mechanism : Follow up Reports on decisions recorded in the Draft Minutesof the previous meetings are discussed at the immediately succeeding meeting of the Board/Committee.

iv) Recording of Minutes at Board/Committee Meetings : The Minutes of the proceedings of eachBoard/Committee Meetings are recorded by the Secretarial Department. The Minutes are subsequentlyconfirmed in the following Meeting of the Board/Committee and entered in the Minutes Bookaccordingly.

7.7 CODE OF BUSINESS CONDUCT

Adoption of Code of business conduct and ethics for board members and senior management are inthe process of implementation.

8. POLLUTION CONTROL MEASURES

The Company is constantly taking measures to keep the environment in the factory areas free fromwater and air pollution.

9. VIGILANCE ACTIVITIES

To look after work of Chief Vigilance Officer, Shri Sengupta, CFO, NJB, has taken the charge ofCVO on part time basis.

10. OFFICIAL LANGUAGE

The Corporation has been making continuous efforts to implement the directives of Official LanguagePolicy of Govt. of India during the year under review.

11. DIRECTORS’ RESPONSIBILITY STATEMENT

Your Directors state that :-

(i) In the preparation of the annual accounts for the year ended 31st March 2015, the applicable accountingstandards have been followed and there has been no material departure.

(ii) The Directors have selected such accounting policies and applied them consistently and madejudgments and estimates that are reasonable and prudent so as to give a true and fair view of thestate of affairs of the Company as at the 31st March 2015 and of the loss of the Company for theyear ended on the date.


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(iii) The Directors have taken proper and sufficient care for the maintenance of adequate accountingrecords in accordance with the provision of the Companies Act for safeguarding the assets of theCompany and for preventing and detecting fraud and other irregularities,

(iv) The Directors have prepared the annual accounts on a going concern basis.

12. BOARD OF DIRECTORS

Shri Kushal Bhaduri joined as Chairman-cum-Managing Director of NJMC Ltd. w.e.f 23rd January 2015.

Shri Subrata Gupta, IAS, who joined the Board of Directors of your company w.e.f. 01.01.2013 relinquishedthe office of Chairman-cum-Managing Director of your corporation w.e.f. 23rd January 2015.

Mrs. Babni Lal (IES) joined as part time Director on the Board of NJMC Ltd. with effect from 30th

June 2014. She relinquished the office of director w.e.f 12th November 2014.

Mrs. Monika Garg (IAS) joined as part time Director on the Board of NJMC Ltd. with effect from 25th

August 2014. She relinquished the office of director w.e.f 15th September 2014.

Shri Sujit Gulati, IAS, part time Director resigned from the Board w.e.f 03rd March 2015.

Shri Y.K. Garg, Director Finance, NJMC Ltd. discontinued w.e.f 16th January 2015.

13. STATUTORY INFORMATION AND DISCLOSURESThere was no employee who was in receipt of remuneration in excess of limits prescribed under theprovisions of the Companies Act, 2013 during the year.

14. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGNEXCHANGE EARNINGS AND OUTGOAs required to be disclosed under the Companies Act, details relating to conservation of energy,technology absorption and foreign exchange earnings and outgo are given in the Annexure-I attachedhereto and forms a part of Directors’ Report.

15. EXTRACT OF ANNUAL RETURNExtract of Annual Return of the Company is annexed herewith as Annexure II to this report.

16. RESERVATION FOR SCHEDULED CASTES, SCHEDULED TRIBES AND OTHERBACKWARD COMMUNITIESFresh recruitment in NJMC has been stopped since 1991 and the Company has been referred to BIFRin 1992. Now BIFR has approved the revival scheme on March 31, 2011 wherein all the workers andother employees are to be taken under contract system during the implementation of Revival Planapproved by BIFR. However your company shall follow the reservation policy if it takes regularemployees on roll of NJMC.

17. HUMAN RESOURCE POLICY AND INDUSTRIAL RELATIONSAfter offering voluntary retirement to all the employees and workers in accordance with the approvedrevival scheme, NJMC is engaging workers through contractors for production and was paying wagesto contract workers along with statutory benefits viz. PF, ESI etc.The NJMC has started the production in all three Revival mills with repair and renovation of oldmachineries after a gap of eight years.Your company has engaged reputed HR agencies to provide various services for implementation ofrevival plan by engaging suitable incumbents on their roll and also on the roll of your company. TheIndustrial relation in your company has not been good in part because of failure of the LabourContractors to enforce discipline in the mills. Continued poor productivity and incidents of intimidationof supervisory


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staff forced the management to declare “Suspension of Work” with effect from 9th September 2013 inKhardah mill which continued till the end of the year.

18. STEPS TOWARD MODERNISATION AND INDUCTION OF PRODUCTION CONTRACTMETHODThe Company continued its effort to stabilize the production, productivity and to curtail the losses byintroducing production contract method in the year 2013-14. For the Unit Kinnison and RBHM, thismethod appeared to be working well and all the parameters related with production has improvedconsiderably.

However, the production target for Kinnison and RBHM could not be achieved due to various factorslike order deficiency, productivity losses due to inefficiency of contractor, health of the machines,unionism, and erratic labour problems, power cut etc.For the Unit Khardah,the production contractcould not be started due to industrial relation problem and irrational demands of the unions andsegment of unions of Khardah. The mechanism of operation of all the three Units have minimized theNJMC deployed personnel to a minimum one.

To further optimize the production contract, a new model is being designed to introduce in the KhardahUnit which will give the job contractor a percentage of the sale price of the sacking and product. Themodel is designed in such a manner that NJMC will not lose money on account of job conversion of B-Twill bags. If this model is successful in the Khardah Unit, NJMC will look forward in the comingyear to introduce the same model in its Units of Kinnison and RBHM. The model is designed to takecare of the optimum power consumption thereby losses due to power will also be restricted.

With this, the Company is expecting to prevent its losses from operational head and will look forwardto diversify its activities into different products like fine hessian, jeo-textiles or shopping bags ofdifferent model.

19. AUDITORS & AUDIT REPORTSComptroller and Auditor General of India had appointed M/s. Nag & Associates, Chartered Accountantsas Statutory Auditors for the year ended 31st March, 2015.The Auditors’ Report to the Shareholders and the Management’s Reply thereto is enclosed.

20. REVIEW OF ACCOUNTS BY CAGThe Comptroller and Auditor General of India, has reviewed the accounts of your company and theircomments has been placed in Annexure-III.

21. ACKNOWLEDGEMENTYour Directors are grateful to the various Ministries of the Government of India particularly theMinistry of Textiles, Ministry of Finance and the Department of Public Enterprise for their supportand guidance to the Company from time to time. They are also thankful for the co-operation receivedfrom the Government of West Bengal and Bihar. The Directors also place on record the continuedassociation and support received from Company’s Bankers, CAG, Statutory Auditors and all itsemployees.

For and on behalf of the Board of Directors

Place :- Kolkata. (Kushal Bhaduri)Date :- 16/09/2015 Chairman-cum-Managing Director.


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Annexure - I

Disclosure of particulars with respect to conservation of energy, technology absorption and foreignexchange earnings and outgo.

A. Conservation of energy:

Your Company is conscious about its responsibility to conserve energy, power and other energy sourceswherever possible and continue to adhere to all regulatory requirements and guidelines. The Companycontinuously strives through various means to conserve energy and identify methods for optimum useof energy. ''Information regarding total energy consumption and energy consumption per ''Unit ofProduction given in Prescribed From ''A'' Annexed,

B. Technology Absorption

The operational activities of the Company were suspended for more than eight years due to sicknessand erosion of net worth .BIFR approved the revival scheme of this company on 31st march 2011 withmodernization plan at a cost of Rs.215.70 Crore. Research and Development as well as the TechnologyAbsorption, Adaptation and Innovation, as such could not be undertaken.

C. Foreign exchange Earnings and outgo

Rs. in Lakh

Current Year Pervious year(2014-2015) (2013-2014)

Earned Nil Nil

Used Nil Nil


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FORM : A

FORM FOR DISCLOSURE OF PARTICULARS WITH RESPECT TOCONSERVATION OF ENERGY

PARTICULARS Current Year Previous Year(2014-2015) (2013-2014)Rs. in Lacs Rs. in Lacs

1.. POWER & FUEL CONSUMPTION

Electricity :

a) Purchased

Unit ( in 000’KWH) 1478.31 2947

Total Amount ( Rs.in lakh) 129.12 221.09

Rate per KWH ( in Rs ) 8.73 7.50

b) Own Generation

Through Diesel Generators

Unit ( in 000’KWH) Nil 1.54

KWH per Ltr. of Diesel oil Nil 2.80

Cost per KWH ( in Rs ) Nil 18.70

2. Coal ( steam coal - B & C Grade ) :

Quantity ( MT ) Nil Nil

Total Cost (Rs in Lacs) Nil Nil

Average Rate( Rs / MT) Nil Nil

3. CONSUMPTION PER M.T. OF PRODUCTION

Electricity ( in KWH ) 585 612

Coal ( in KG ) Nil Nil

UNIT - KINNISON, NJMC LTD.

Auditors’ Certificate on Corporate GovernanceTo The Members

National Jute Manufactures Corporation Limited

We have examined the compliance of conditions of Corporate Governance by National JuteManufactures Corporation Limited( the “Company”) for the year ended 31st March,2015 as stipulatedin the Guidelines on Corporate Governance for the Central Public Sector Enterprises issued by theDepartment of Public Sector Enterprises, Government of India, vide Notification No.OM No.18(8)/2005-GM dated 14th May, 2010.

Compliance of the conditions of Corporate Governance is the responsibility of the Management.Our examination was limited to procedures and implementation thereof, adopted by the Companyfor ensuring compliance of the conditions of Corporate Governance. It is neither an audit nor anexpression of opinion on the financial statements of the Company.

On the basis of the records and documents maintained by the Company and the information andexplanations given to us we certify that the Company has complied with the conditions of CorporateGovernance as stipulated in the above mentioned Guidelines, keeping in view the nature of businessactivities and the financial condition of the Company.

We further state that such compliance is neither an assurance as to the future viability of theCompany nor efficiency or effectiveness with which the Management has conducted the affairs ofthe Company.

Nag & AssociatesChartered Accountants

(FRN: 312063E)

Nilotpal MajumderPartner

(M.No. 037287)


Place: Kolkata

Date: 16.09.2015

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COMMENTS OF THE COMPTROLLER AND AUDITOR GENERAL OF INDIA UNDERSECTION 143(6)(b) OF THE COMPANIES ACT, 2013 ON THE FINANCIALSTATEMENTS OF NATIONAL JUTE MANUFACTURES CORPORATION LIMITED,KOLKATA FOR THE YEAR ENDED 31ST MARCH, 2015

The preparation of financial statements of National Jute Manufactures Corporation Limited forthe year ended 31st March, 2015 in accordance with the financial reporting framework prescribedunder the Companies Act, 2013 is the responsibility of the management of the company. The Statutoryauditor appointed by the Comptroller and Auditor General of India under Section 139(5) of the Act,is responsible for expressing opinion on these financial Statements under Section 143 of the Act,based on independent audit in accordance with the Standards on Auditing prescribed u/s. 143(10) ofthe Act. This is stated to have been done by them vide their Audit Report dated 18th August, 2015.

I, on behalf of the Comptroller and Auditor General of India, have decided not to conduct thesupplementary audit of the financial statement of National Jute Manufactures Corporation Limitedfor the year ended 31st March,2015 and as such have no comments to make u/s.143(6)(b) of the Act.

For and on behalf of the Comptroller & Auditor General of India

Praveer Kumar Principal Director of

Commercial Audit & Ex-officio Member, Audit Board-I, Kolkata

Place: KolkataDate: 24th September, 2015.


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INDEPENDENT AUDITORS’ REPORT

TOTHE MEMBERS OFNATIONAL JUTE MANUFACTURES CORPORATION LIMITEDReport on the Standalone Financial Statements

1) We have audited the accompanying standalone financial statements of NATIONAL JUTEMANUFACTURES CORPORATION LIMITED (“the Company”), which comprise the BalanceSheet as at 31st March, 2015, the Statement of Profit and Loss, the Cash Flow Statement for the yearthen ended, and a summary of the significant accounting policies and other explanatory information.

Management’s Responsibility for the Standalone Financial Statements

2) The Company’s Board of Directors is responsible for the matters stated in Section 134(5) of theCompanies Act, 2013 (“the Act”) with respect to the preparation of these standalone financialstatements that give a true and fair view of the financial position, financial performance and cashflows of the Company in accordance with the accounting principles generally accepted in India,including the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of theCompanies (Accounts) Rules, 2014. This responsibility also includes maintenance of adequateaccounting records in accordance with the provisions of the Act for safeguarding the assets of theCompany and for preventing and detecting frauds and other irregularities; selection and applicationof appropriate accounting policies; making judgments and estimates that are reasonable and prudent;and design, implementation and maintenance of adequate internal financial controls that wereoperating effectively for ensuring the accuracy and completeness of the accounting records, relevantto the preparation and presentation of the financial statements that give a true and fair view and arefree from material misstatement, whether due to fraud or error.

Auditor’s Responsibility

3) Our responsibility is to express an opinion on these standalone financial statements based on ouraudit.

4) We have taken into account the provisions of the Act, the accounting and auditing standards andmatters which are required to be included in the audit report under the provisions of the Act and theRules made there under.

5) We conducted our audit in accordance with the Standards on Auditing specified under Section143(10) of the Act. Those Standards require that we comply with ethical requirements and plan andperform the audit to obtain reasonable assurance about whether the financial statements are freefrom material misstatement.

6) An audit involves performing procedures to obtain audit evidence about the amounts and thedisclosures in the financial statements. The procedures selected depend on the auditor’sjudgment, including the assessment of the risks of material misstatement of the financialstatements, whether due to fraud or error. In making those risk assessments, the auditor considersinternal financial control relevant to the Company’s preparation of the financial statementsthat give a true and fair view in order to design audit procedures that are appropriate in thecircumstances, but not for the purpose of expressing an opinion on whether the Company hasin place an adequate internal financial control system over financial reporting and the operatingeffectiveness of such controls. An audit also includes evaluating the appropriateness of theaccounting policies used and the reasonableness of the accounting estimates made by theCompany’s Directors, as well as evaluating the overall presentation of the financial statements.


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7. We believe that the audit evidence we have obtained is sufficient and appropriate to provide basisfor our audit opinion on the standalone financial standards.

Opinion:8 In our opinion and to the best of our information and according to the explanations given to us,

read with Emphasis of Matter in Paragraph 9 here in under and subject to our comments thatwe are unable to express our opinion on:

a) in absence of confirmation of balances regarding adequacy of provisions made against OtherAdvances of Rs.318.68 Lacs under Short Term Loans & Advances in Note No. 15.

b) provision not made against the amount of loans and advances recoverable from Company’sSubsidiary Birds Jute & Exports Limited of Rs. 301.42 lacs, which is in our opinion is doubtfulof recovery.

c) Interest income considered in the books of the Company on fixed deposits amounting toRs.1896.04 lacs and interest earned on loans and advances given to Company’s Subsidiaryamounting to Rs.78.21 lacs, both are generated out of GOI’s interest free loan and hence theseshould not be treated as Company’s income resulting understatement of loss of Rs.1974.25 lacs.

d) any impairment loss in fixed assets that may arise as the carrying amount has not been determinedby the Company in accordance with Accounting Standard 28 referred to u/s 129 sub-section (1)of the Companies Act,2013.

e) in support of investments with the Government Authorities / Others Agencies neither the namesof Government Authorities / Others Agencies nor any confirmation certificate from them weremade available to us for verification at the time of audit.

f) any material discrepancy that may arise in respect of fixed assets of the Company as mentionedin Para 1(b) in the Annexure to our report.

9 The aforesaid standalone financial Statements give the information required by the Act in themanner so required and give a true and fair view in conformity with the accounting principlesgenerally accepted in India:

a) in the case of the Balance Sheet, of the state of affairs of the Company as at 31st March 2015;b) in the case of the Statement of Profit and Loss, of the Loss of the Company for the year ended on

that date; andc7) in the case of Cash Flow Statement, of the cash flow of the Company for the year ended on that date.

Emphasis of Matter:10 Without qualifying our opinion, we draw attention to:

a) The Additional Information disclosed in Note 10 relating to Fixed Assets.b) Since the Company is a sick Company and operating under BIFR rehabilitation scheme where

the operating agent being the Industrial Development Bank of India (IDBI), the company’sperformance is lagging far behind the norms as projected by the BIFR rehabilitation schemewhich may actually endanger the existence of the Company in future as a going concern.

c) The Company‘s net worth has totally been eroded long before and negative net worth amountsto Rs. 24,468.87lacs as on 31st March, 2015, as refer to in Para 8 in the annexure of our report.The Company has incurred consistently net operating loss/net cash loss during the current andprevious years. The Company’s current and non-current liabilities also exceeded its currentnon-current assets as at the balance sheet date. These conditions along with other matters setforth in our Notes indicate the existence of a material uncertainty that may cast significantdoubt about the Company’s ability to continue as a going concern. The accounts, however, havebeen drawn on “Going Concern” basis in accordance with the Revival Scheme approved byBIFR on 31.03.2011.

d) After the Balance Sheet date it is noticed that in one of the major operating mills of the Companyi.e. Kinnison Mill, a fire broke out resulting a considerable amount of loss approximately Rs.25.00 lacs.The Company is in the process of lodging the claim with the Insurance Company.However, it appears that the mill will not be in operation for a considerable period.


17

Other Matter11) The Company is having one subsidiary named Birds Jute & Exports Limited, the accounts of the said

subsidiary have not been merged in the Company‘s financial statement as on 31st March, 2015.

Report on Other Legal and Regulatory Requirements12) As required by ‘the Companies (Auditor’s Report) Order.2015’, issued by the Central Government of

India in terms of sub-section (11) of section 143 of the Act (hereunder referred to as the “Order), andon the basis of such checks of the books and records of the Company as we considered appropriateand according to the information and explanations given to us, we give in the Annexure-A a statementon the matters specified in paragraphs 3 and 4 of the Order.

13) As required by Section 143(3) of the Act, we report that:(a) We have sought and obtained all the information and explanations which to the best of our

knowledge and belief were necessary for the purposes of our audit.(b) In our opinion, proper books of account as required by law have been kept by the Company

so far as it appears from our examination of those books.(c) The Balance Sheet, the Statement of Profit and Loss, and the Cash Flow Statement dealt

with by this Report are in agreement with the books of accounts.(d) In our opinion, the aforesaid standalone financial statements comply with the Accounting

Standards specified under Section 133 of the Act, read with Rule 7 of the Companies(Accounts) Rules, 2014.

(e) The going concern matters described in sub-paragraph (a) & (b) under the Emphasis ofMatters mentioned above, in our opinion that may have an adverse effect on the functioningof the Company.

(f) On the basis of the written representations received from the directors as on 31st March,2015, taken on record by the Board of Directors, none of the directors is disqualified as on31st March, 2015 from being appointed as a director in terms of Section 164 (2) of the Act.

(g) With respect to the other matters to be included in the Auditor’s Report in accordance withRule 11 of the Companies (Audit and Auditors) Rules, 2014, in our opinion and to the bestof our information and according to the explanations given to us:i The Company does not have any such pending litigation which would materiallyimpact its financial position.ii The Company did not have any such long-term contracts including derivativecontracts for which there may be any material foreseeable losses.iii There has been no delay in transferring amounts, required to be transferred, tothe Investor Education and Protection Fund by the Company.

14) Further, as required by Section 143(5) of the Act, we report that:(a) The Company has not yet been selected for disinvestment, hence, examination of complete

status report in terms of valuation of Assets and Liabilities including the mode and presentstage of disinvestment process does not arise.

(b) During the year under audit there is no case of waiver/write off of debts/loan/interest etc.,(c) Neither any inventory is lying with the third party nor has the Company received any gift

of assets from the Government or other authorities, as informed by the Company’smanagement.

(d) Number of pending legal/arbitration cases indicating the age wise analysis and reasons fortheir pendency is highlighted in Annexure-B. Legal expenses are generally incurred bythe Company as per the delegation of power and internal policy of the Company.

Nag & AssociatesChartered Accountants(FRN: 312063E)

(Nilotpal Majumder)Place: Kolkata PartnerDate: 16.09.2015 (M. No. 037287)


18

ANNEXURE-ANATIONAL JUTE MANUFACTURES CORPORATION LIMITEDTO THE INDEPENDENT AUDITORS’ REPORT

Referred to in paragraph 12 of the Independent Auditors’ Report of even date to the members of NationalJute Manufactures Corporation Limited on the standalone financial statements as of and for the year ended31st March, 2015.

1. (a) The Company is maintaining records showing full particulars, including quantitative details and situation of its fixed assets.

(b) The fixed assets of the Company have not been physically verified by the management as on 31st

March, 2015. There is no system of physical verification of fixed assets at regular interval. Accordingly,the discrepancy, if any, between the existence of fixed assets as on the balance sheet date and as perthe records maintained in the fixed assets register could not be ascertained and accounted for.

(c) According to the information and explanations given to us, the Company has not disposed anysubstantial part of fixed assets during the year.

2.(a) Physical verification of inventory, consisting of raw materials, work in process, finished goods ,storesand spares has been conducted by the management in respect of Kinnison, RBHM and Khardah unitsat the end of the year through the independent Stock Auditors. However, no such physical verificationhas been conducted either by the independent Stock Auditors or by the management in the threeclosed units i.e. Union, Alexandra and National. The discrepancy, if any, in this respect have notbeen ascertained and accounted for.

(b) In our opinion and according to the information and explanations given to us the procedure ofphysical verification followed by the management, where conducted, appears to be reasonableand adequate in relation to the size of the company and the nature of its business.

(c ) In our opinion and according to the information and explanations given to us, the Company ismaintaining proper records of its inventory at its Kinnison, RBHM and Khardah units and nomaterial discrepancies were noticed by the Stock Auditor in course of reconciliation betweenphysically verified stocks and book records in respect of raw materials, work in process, finishedgoods, stores and spares. In respect of stores and spares pertaining to closed units i.e. National,Union and Alexandra units, the Company holds full provision against the same.

3. The Company neither granted nor taken any loan, secured or unsecured, to/ from Companies, Firmsor others parties covered in the register maintained under section 189 of the Companies Act 2013,except loan given to its subsidiary Company Bird Jute & Exports Limited, where Managing Directorof the Holding Company (National Jute Manufactures Corporation Limited) is also the ManagingDirector of its subsidiary (Bird Jute & Exports Limited). Amount recoverable from subsidiary in thisaccount stands outstanding as on 31st March,2015 for an amount of Rs.4,376.02(Refer Note No.15)


19

:

Particulars As at 31.03.2015 As at 31.03.2014(Rs. In Lacs) (Rs. In Lacs)

Income Tax Deducted at Source fromContractors’ Bill - 6.34

Labour Welfare Fund - 1.91

Interest Payable on Professional Tax - 68.69

Total - 76.94

4. In our opinion and according to the information and explanations given to us, there is an adequateinternal control system commensurate with the size of the company and the nature of its businessfor purchase of fixed asset, inventory and for the sale of goods. However, action should immediatelybe taken to recover the long standing debit balances in creditors account and loans and advances tosubsidiary. During the course of our audit we have not observed any other continuing failure tocorrect major weakness in the internal control system of the company.

5. The company has not accepted in any deposit from the public within the meaning of section 73, 74,75 and 76 of the Companies Act 2013. Consequently the directives issued by the Reserve Bank ofIndia in this connection are not applicable.

6. We have broadly reviewed the books of accounts maintained by the Company without making adetailed examination of the same, pursuant to the rules made by the Central Government formaintenance of cost records under clause (d) of sub-section (1) of section 148 of the CompaniesAct 2013 and we are of the opinion that prima facie the prescribed accounts and records have beenmaintained.

7.. (a) According to the books and records of the Company examined by us we state that the Companywas generally regular in depositing undisputed statutory dues including Provident Fund, InvestorEducation and Protection Fund, Employees’ State Insurance, Income Tax, Sales Tax, Value AddedTax, Wealth Tax, Service Tax, Customs Duty, Excise Duty, Cess and Other statutory dues asapplicable to this Company with the appropriate authorities. However, there are arrear statutorydues towards damages sought for wavier under BIFR Scheme which is yet to be settled. Accordingto the information explanations given to us, the total undisputed statutory dues outstanding as at31st March 2015 for a period exceeding six months from the date they became payable are asfollows :


20

Particulars Period for As at As at Form wherewhich it Relates 31.03.2015 31.03.2014 Pending

(Rs. In Lacs) (Rs. In Lacs)

Excise Duty Period for avery long time 22.14 22.14 Assistant Collector

of Central Excise

Interest on P.F Period for 1199.55 1199.55 Central P.FDues and a very long time CommissionerDamages.

Employer’s Period for 3727.17 3727.17 Director GeneralShare of a very long time ESICContribution ofE. S. I. Interest andDamages

Total 4948.86 4948.86

(c) According to the information and explanations give to us the Company is not having any amountrequired to be transferred to Investor Education and Protection Fund in accordance with the provisionsof the Act and rules framed there under.

8. The company’s net worth has totally been eroded long back. The same stands at negative amountingto Rs.24, 468.87 lacs as at 31st March 2015. It has incurred cash losses in the current financial yearand also in the immediately preceding two financial years.

9. The company has not defaulted in repayment of dues to financial institutions or banks during theyear. The Company has not issued any Debentures.

10. The company has not given any guarantee for loans taken by others from banks and financialinstitutions.

11. On the basis of review of utilization of funds pertaining to Term Loan and related information andexplanation given to us, we observed that the Company has not availed any Term Loan from Banks/Financial Institutions during the year. However, the loans granted to the Company under BIFR packageby Government of India has not been totally utilized and the unutilized balance has been kept depositedwith the Banks, interest on which is recognized as income and is being credited to profit & lossaccounts since no clear directives have been received from Government of India.

12. During the course of our examination of the books and records of the Company, carried out in accordancewith the generally accepted auditing practices in India and according to the information and explanationsgiven to us, we have neither come across any instance of material fraud on or by the Company, noticedor reported during the year, nor have we been informed of such case by the Management.

Nag & AssociatesChartered Accountants(FRN: 312063E)

(Nilotpal Majumder)Place: Kolkata PartnerDate: 16.09.2015 (M. No. 037287)


(b) According to the records of the Company and the information and explanations given to us, there are no disputed dues to be deposited in respect of Income Tax, Sales Tax, Wealth Tax, Service Tax,Custom

Duty, Excise Duty and Cess as at 31st March 2015 except as stated below:

21


Annexure – “B’

Pending Legal Cases Of National Jute Manufactures Corporation Limited

As on 31.03.2015 (updated on the date of audit)

Sl no.

Period Case no with court Background and facts of the case

Present status Next date Financial implication (as estimated) 0 -5 yrs

1

W.P.No.14481(w) of 2011- Samir Das & ors. –vs- Union of India & ors.

Claiming balance 60% vrs benefit.

Out of list petitioner has to mention for listing with notice to NJMC ( respondent)

40% scale already paid as full and final settlement . 60% cannot be estimated.

2

Mat 1894 Of 2013 Arising Out Of W.P.20168 (W) Of 2013 And W.P.20170(W0) Of 2013 NJMC Vs- State Of West Bengal & Ors.

Payment of arrears and interest on gratuity.

Pending Will have to mention

Rs.40,088.00 Rs.34,193.00 Rs.25,260.00 estimated.

3

T.S 9/2010,,, NJMC Vs Nand Kishore Tiwari

For recovery of quarters

Pending at 1st Sub-Judge Katihar

28/01/2014 Land matters, rs.30 lacs estimated.

4 T.S 10/2010,,,

NJMC Vs Shyam Sundar & Others


Pending at 1st Sub-Judge Katihar

25/2/2014 -do-

T.S 14/2010,,, NJMC Vs Vidya Devi & Others


Pending 1st Sub- judge Katihar exparte hearing against respondent

20/3/14 -do-

5

T.S 15/2010,,, NJMC Vs Pradeep Kumar Saraogi

For recovery of quarters and land

Pending 3rd Sub judge Katihar, examination of PW2

10/02/2014 -do-

6

T.S 28/2010,,, NJMC Vs Ram Chandra Saraogi & Others

The defendant has occupied the quarter even afetr expiry of service

Pending at 3rd Sub judge Katihar

27/1/2014 Land matters, rs.25 lacs estimated.

7

T.A 17/2008, Kameswar Pandit Vs NJMC

For recovery of land

NJMC won the case

Land matters, Rs.30 lacs estimated.

22


8

Witness (p w 1) examination going on thereafter cross examination followed by argument and then judgment claiming for title in land

T.S 158/11,,,, Sheila Devi Chamaria Vs Rbhm Katihar

Land matters, Rs.50 lacs estimated.

9

NJMC Ltd Vs Central Excise

Matter filed before the reviewing authority under section 35ee of Central Excise Act1944,awaiting for hearing of stay petition

Pending Date to be fixed up for hearing of the stay application

Rs.3,74,490.00 & Rs.72,246.00 estimated.

10

G. C48(2)/2012, Panchu Gopal Karmakar Vs NJMC

Short payment of gratuity amount as well as delayed payment for which interest was claimed

CAV Rs 1,11,324.15

11

Durga Prasad Roy Vs State of W B & Others [ W P31499(W) Of 2013] + Mat 16/2015 Njmc Vs D P Roy ,Calcutta Corporation & Others

Recovery of the property

Disposed off we have surrendered the premises to D P Roy to save unnecessary expense of keeping vacant premises without any employee ,now an appeal is pending before court no 2 because Hon’ble Court has imposed a burden of 70 lakhs Corporation Tax on us

26/03/2015 70 lakhs + Corporation Tax .

Sl No.

Period Case No With Court

Background and facts of the case

Present status Next date Financial implication (as estimated) 5 – 10

yrs

12

C.C No 1-19 Of 2004-2005, Bazaar Sanity Vs Njmc

Interest amount Pending with Co. Katihar i.e. E. Assistant Collector

25/01/2014 Rs.1.23 crores interest to be paid.

13

W P 4764/2006, Berhampore Thana Agricultural Society Vs Njmc Ltd & Others

Claiming dues of 26.84 lakhs they have filed this instant writ

Out of list. Petitioners have to mention with notice to NJMC

Rs.26,860.00

23

T.S158/11Shila DeviChamariaVS RBHMKatihar

Paindingat 3rdSub JudgeKatihar


Sl No.

Period Case No With Court

Background and facts of the case

Present status Next date Financial implication (as estimated)

10 yrs & above

14

T.S 42/01, Rajendra Mallik & Others Vs U O I & N J M C

Claiming for adverse posession on the plot of land of NJMC

Pending at 3rd Sub judge Katihar, last witness examination

22/1/2014 Land matters, Rs.20 lacs estimated.

15

P.T 531/1998,Central Bank Of India Vs NJMC & Others

Dues as was pending with Central Bank .

Pending with p o already appeal filed as mentioned in the list at allahabad

N a Estimated Rs.20,73,629.18

16

M S 482/99, Kingsley Industries Pvt Ltd Vs Rbhm

Ex-parte decree. Pending in city civil court.

N A ,, To be found out

Rs.5267.05, Rs.3412.80, Rs.6495.00

17

M S 483/99, Kingsley Industries Pvt Ltd Vs Kinnison


N a ,, To be found out

-do-

18

M S 640/99, Kingsley Industries Pvt Ltd Vs Alexandra


N a , To be found out

-do-

19

M.S 159/2004, Tirupati Jute Suppliers Vs NJMC

Non payemnt of dues

The matter is pending in city civil court no dates are available a o r cant be traced out ,the criminal case is also pending in bankshal court

N a ,, To be found out

Rs.13,42,768.22

[ N.B..- Matters pending in the list of Hon’ble High Court date cannot be given as no

particular date is fixed for those matters they are running on list]

24

Executive (Legal)NJMC LTD.

Sounok Chatterjee


Balance Sheetas at

31st March 2015

(A Government of India Undertaking)

NATIONAL JUTE MANUFACTURES CORPORATION LTD.(A Goverment of India Undertaking)

BALANCE SHEET AS AT 31ST MARCH, 2015(Rs. InLakh)

Note no. As at As at 31st March, 2015 31st March, 2014

(A) EQUITY AND LIABILITIES

(1) Shareholders‘ Funds:(a) Share Capital 2 5,579.74 5,579.74(b) Reserves and Surplus 3 (30,048.61) (24,468.87) (29,999.83) (24,420.09)

(2) Non-Current Liabilities (a) Long-Term Borrowings 4 42,923.80 39,430.88 (b) Long-Term Provisions 5 23.35 42,947.15 23.35 39,454.23

(3) Current Liabilities(a) Short-Term Borrowings 6 198.09 182.09(b) Trade Payables 7 3,186.83 2,331.26(c) Other Current Liabilities 8 4,465.81 5,445.04(d) Short-Term Provisions 9 189.08 8,039.81 189.08 8,147.47 TOTAL 26,518.09 23,181.61

(B) ASSETS (1) Non-Current Assets

(a) Fixed Assets (i) Tangible Assets 10 1,357.25 1,113.85 (ii) Capital Work-in-Progress 10 17.48 1,374.73 17.48 1,131.33(b) Non-Current Investments 11 - 0.41

(2) Current Assets(a) Inventories 12 1,310.44 1,439.21(b) Trade Receivables 13 466.03 268.02(c) Cash And Cash Equivalents 14 21,561.85 18,256.43(d) Short-Term Loans and advances 15 898.90 852.09(e) Other Current Assets 16 906.14 25,143.36 1,234.12 22,049.87TOTAL 26,518.09 23,181.61

Significant Accounting Policies 1Notes forming integral part of theFinancial Statements 1-25In terms of our report of even dateFor Nag & AssociatesChartered AccountantsRegistration No.312063E(Nilotpal Majumder) PartnerMembership No. 037287Date : 16/09/2015Palace : Kolkata

Ashok Kumar MishraCompany Secretary

KUSHAL BHADURIChairman-cum-Managing Director

27

STATEMENT OF PROFIT & LOSS FOR THE YEAR ENDED 31ST MARCH, 2015(Rs. In Lakh)

Note For the year ended For the year endedno. 31st March, 2015 31st March, 2014

INCOME

1 Revenue from Operations 17 3,769.86 5,812.332 Other Income 18 2,035.23 1,798.123 Total Revenue (1 + 2) 5,805.09 7,610.45

4 EXPENSES (a) Cost of Raw Materials Consumed 19 2,261.81 3,265.84 (b) Change in Inventories of Finished Goods and Work-in-Process 20 249.93 122.01 (c) Employee Benefits Expenses 21 220.00 162.15 (d) Finance Costs 22 30.92 30.25 (e) Depreciation and Amortisation Expenses 10 171.81 54.76 (f) Other Expenses 23 2,919.26 4,625.78 Total Expenses (a+b+c+d+e+f) 5,853.73 8,260.79

5 (Loss) before exceptional and extraordinary items and tax (3-4) (48.64) (650.34)

6 Exceptional Items (4.74)7 (Loss) before extraordinary items and tax (5+6) (48.64) (655.08)8 Extraordinary Items - -9 (Loss) before tax (7-8) (48.64) (655.08)10 Tax Expense

(a) Current Tax - - (b) Deferred Tax - -

11 (Loss) for the year (9+10) (48.64) (655.08)12 Earning per Equity Share

(In Rs. For an equity Share of Rs. 1,000/- each) Basic 24 (8.72) (117.40) Diluted 24 (8.72) (117.40)

Significant Accounting Policies 1Notes forming integral part of theFinancial Statements 1-25

In terms of our report of even dateFor Nag & AssociatesChartered AccountantsRegistration No.312063E

(Nilotpal Majumder)PartnerMembership No. 037287

Date : 16/09/2015Palace : Kolkata



NATIONAL JUTE MANUFACTURES CORPORATION LTD.(A Goverment of India Undertaking)

28


CASH FLOW STATEMENT FOR THE YEAR ENDED 31ST MARCH, 2015 (Rs. In Lakh)

For the year ended For the year ended 31st March, 2015 31st March, 2014

A. Cash Flow fromOperating ActivitiesNet Profit /(Loss) before extraordinary item and Tax Adjustments for:DepreciationInterest IncomeAdjustments for Govt. Grant (Reserve)

Operating Profit before Working Capital Change

Increase / Decrease in InventoriesIncrease / Decrease in Trade ReceivablesIncrease / Decrease in Loan & Advances and OtherIncrease/Decrease in Current AssetsIncrease / Decrease in Trade PayablesIncrease / Decrease in Current LiabilitiesIncrease / Decrease in Short term BorrowingIncrease/Decreease in Investment

Cash Flow from Operations

Net Cash from Operating Activities (A)

B. Cash Flow from Investing ActivitiesPurchase of Fixed AssetsCapital work in progressInterest Income

Net Cash from Investing Activities (B)

C Cash Flow from Financing ActivitiesIncrease in Long Term Borrowing

Net Increase / (Decrease) in Cash & CashEquivalents (A+B+C)

Cash and Cash Equivalentsat the beginning of the year

Cash and Cash Equivalents at the end of the year

(48.64)

(1,863.56)(1,912.20)

104.68

(1,807.52)

(1,807.52)

1,620.02

1,620.02

3,492.92

3,305.42

18,256.43

21,561.85

171.81(2,035.23)

(0.14)

128.77(198.01)

(46.81)327.98855.57

(979.23)16.00

0.41

(415.21)

2,035.23

(655.08)

(1,743.50)(2,398.58)

(234.74)

(2,633.32)

(2,633.32)

1,814.72

1,814.72

30.25

(788.35)

19,044.78

18,256.43

54.76(1,798.12)

(0.14)

301.63(18.52)

(164.82)(52.74)

(392.05)(127.43)

219.19

(10.45)27.05

1,798.12

29

CASH FLOW STATEMENT FOR THE YEAR ENDED 31ST MARCH, 2015 (Contd.)

Components of Cash and Cash Equivalents are :(Rs. In Lakh)


a) Balances with Banks(i) In current account 205.83 40.30(ii) In fixed deposit account 21,355.11 18,215.37(iii) Margin Monry 3.10 21,564.04 3.10 18,258.77

Less :- Provision against 3.10 3.10

21,560.94 18,255.67

b) Cash in Transit - 0.50

c) Cash on hand 0.91 0.26

21,561.85 18,256.43

For Nag & AssociatesChartered AccountantsRegistration No.312063E






30

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31ST MARCH, 2015.NOTE -1 SIGNIFICANT ACCOUNTING POLICIES

1.1 BASIS OF PREPARATION OF FINANCIAL STATEMENTS

The financial statements are prepared in accordance with Generally Accepted Accounting Principlesand the Company follows Mercantile system of accounting and recognies income and expenditure onaccrual basis.

1.2 FIXED ASSETS :1.2.1 Fixed Assets are valued at cost/book value as on the date of nationalisation.

1.2.2 DEPRECIATION :Depreciation on fixed assets is charged on written down value as per Schedule - II to theCompanies Act, 2013. The company has reassessed the useful life of its existing fixed assets inaccordance with Schedule - II and a new rate of depreciation on written down value methodhas been arrived at to depreciate the assets over the remaining useful life. Since most of theassets were procured long back and the useful life has already been exhausted only 5% residualvalue appears in the books and no further depreciation has been provided on those assets. Outof the total depreciation and an amount of Rs.13158953.63 represent the carrying amount ofthe assets after returning the residual value of 5% as on 1st April, 2014 whose remaininguseful life is Nil as per Schedule- II of the Company's Act 2013 and the company has opted tocharge the amount to the profit and loss accounts.

Since as per approved BIFR rehabilitation plan the assets of all the three closed mills i.e.National, Union and Alexendra are to be disposed off for the revival. No effective action ofNJMC has yet been taken and so the assets are not probable to sale during the current financialyear and hence we have not categorised the assets under "assets held for sale".

1.3 INVESTMENTSInvestments are valued at cost / book value as on the date of nationalisation.

1.4 VALUATION OF STOCK :1.4.1 Raw Jute is valued at cost, determined on FIFO basis, or market price whichever is lower.1.4.2 Finished Goods are valued at costs or market value whichever is lower. Cost includes all direct

cost and applicable manufacturing overheads.1.4.3 Work-in-process is valued at estimated cost based on percentage of specific stage of processing

on a uniform basis. However no conversion cost is included since obligation of payment to theconversion contractor arises after completion of packed production and no liability has beenconsidered for semi finished goods in line with the provision of contract / agreement profit &loss account for incomplete products.

1.4.4 Stores and spares as on 31st March, 2015 have been verified by independent auditor for threerunning mills and valued at cost. However the same for the three closed mills have neitherbeen verified by the management nor by any independent auditor. In this connection 100%provision had already been made against store and spares for three closed mills.

1.5 REVENUE RECOGNITION1.5.1 Turnover - Sales are considered on the basis of devivery / on recipt of consideration against

Paid Delivery Order, and exclusive of any duty / tax.

1.6 CONTINGENT AND OTHER LIABILITIESShow-cause notice received from various Governments / Revenue Authorities are not considered ascontingent liabilities. When the demands are raised against such show cause notices, after consideringCompany‘s views, these demands are either paid or treated as liabilities, if accepted by the Companyand are treated as contingent liability, if disputed by the Company.


31

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31ST MARCH, 2015.

NOTE -2 SHARE CAPITAL (Rs. In Lakh)As at As at

31st March, 2015 31st March, 2014

AUTHORISED

600000 Equity Shares of Rs. 1,000/- each(Previous Year 600000 Equity Shares)

ISSUED, SUBSCRIBED AND FULLY PAID UP557974 Equity Shares of Rs. 1,000/- each(Previous Year 557974 Equity Shares)

TOTAL

ADDITIONAL INFORMATION

a) Of the above 366000 Equity Shares of Rs. 1,000/- each were allotted as fully paid up shares againstNationalization Adjustment Account, without payment having been received in cash.

b) There has been no change / movement in number of shares outstanding as at the beginning and as atthe end of the year.

c) The Company has only one class of Equity Shares having face value of is Rs. 1,000/- per shares. Eachholder of equity shares is entitled to one vote per share and equal right for dividend.

d) Shareholders holding more than 5 percent shares in the Company :

As at As at 31st March, 2015 31st March, 2014

Name of the Shareholders No. of Shares (%) No. of Shares (%)

President of India

6000.00

5579.74

5579.74

6000.00

5579.74

5579.74

557972 99.99 557972 99.99

1.7 RETIREMENT BENEFITS

1.7.1 Gratuity : Liability for gratuity has been provided on the basis of actuarial valuation in respectof employes on roll as on the date of closing of accounts.

1.7.2 Leave Encashment : Liability for Leave Encashment has been provided on the basis of actuarialvaluation.



32


NOTE -3 RESERVES AND SURPLUS(Rs. In Lakh)

As at As at31st March, 2015 31st March, 2014

Capital ReserveAgainst Government GrantsOpening BalanceAdd :- Addition / Transferred during the yearLess :- Utilised / Transferred during the yearClosing Balance

Revaluation ReserveOpening BalanceAdd :- Addition during the yearLess :- Utilised / Transferred during the yearClosing Balance

(Deficit) in Statement of Profit and LossOpening BalanceBalance in Statement of Profit and LossClosing Balance

TOTAL

ADDITIONAL INFORMATIONCapital Reservea) Against balance of grant received from Bihar Government,

amounting to Rs. 150 Lakhs, in 1988-89 for acquiringFixed Assets after adjustment of depreciation on the assetsso procured out of the above funds in respect of RBHM.

b) Against balance of grant received from IJIRA, amounting toRs. 5.44 Lakhs, in 1988-89 for installation of Ring SpinningFrame under UND Project after adjustment of depreciationon the assets so procured out of the above funds in respectod Unit Kinnison.

c) Subsidy of Rs. 0.01 Lakh being the balance of grant receivedfrom WB Industrial Development Corporation Limited in1982-83 amounting to Rs. 6.97 Lakh for installation of captivepower diesel power generating set in respect of Unit Kinnisonafter adjustment of depreciation from the date acquisitionP.Y. 0.01 Lakh.

d) The difference between market value and book value ofInvestments in respect of Unit RBHM as on the date ofnationalisation.

Revaluation ReserveThe difference between the revalued amount (as pervaluation report in 1997-98) and book value as on 31.03.1993in respect of Land situated at Katihar and Land and Buildingsituated at Kalimpong and Forbesgunj in respect of UnitRBHM (Reference : Additional Information No. 7 and 8 inNote 10 on Fixed Assets)

1.67-

0.14

441.81--

(30,443.31)(48.64)

1.53

441.81

(30,491.95)

(30,048.61)

1.81-

0.14

441.81--

(29,788.23)(655.08)

1,67

441.81

(30,443.31)

(29,999.83

1.17

0.24

0.01

0.111.53

441.81

1.17

0.38

0.01

0.111.67

441.81


33


NOTE -4 LONG TERM BORROWINGS

(Rs. In Lakh)As at As at


A) Other loans and advances (Unsecured)i) From Government of Indiaii) From Government of West Bengaliii) Interest accrued and due on borrowings from Government

TOTAL


a) Loan received from Government of India as additional budgetary support in interest free as per therestructuring / revival scheme of NJMC approved by Cabinet Committee on Economic Affairs (CCEA)and BIFR.

b) The Company has not provided any security or any guarantee in respect of the above Loans fromGovernment of India and Government of West Bengal.

c) The Company has defaulted in repayment of loans and interest in respect of the following :

Loan from Government of West Bengal :

i) Principal Since Since31.03.1994 31.03.1994

ii) Interest Since Since 31.03.1994 31.03.1994

TOTAL

The company is yet to receive the formal consent from Government of West Bengal in respect of :

i) Adjustment of Principal Amount of Rs. 281.48 Lakhs above against compensation receivable foracquisition of Land by them as referred to in Additional Information 3 in Note 10 on Fixed Assetsand

ii) conversion of accrued interest of Rs. 922 Lakhs included in the above Interest amount of Rs. 1070.91Lakhs (P. Y. Rs. 1039.99 Lakhs) into a Soft Loan in accordance with BIFR Approved Scheme.

As at 31st March, 2014

Period ofdefault

Amount(Rs. in Lakhs)

As at 31st March, 2015

41,571.41281.48

1,070.91

42,923.80

38,109.41281.48

1,039.99

39,430.88

281.48

1,039.99

1,321.47

281.48

1,070.91

1,352.39

Amount(Rs. inLakhs)

Period ofdefault


34


NOTE-5 LONG TERM PROVISIONS(Rs. In Lakh)


Provision for Employee Benefits

i) Provision for Leave encashment

ii) Provision for Gratuity TOTAL


NOTE -6 SHORT TERM BORROWINGS(Rs. In Lakh)


Overdraft A/c. with Allahabad Bank (Secured against 198.09 182.09Fixed Deposit) TOTAL 198.09 182.09

NOTE -7 TRADE PAYABLES(Rs. In Lakh)


i) Creditors for supplies 2,843.58 1,954.82

ii) Creditors for accrued wages and salaries 343.25 376.44

TOTAL 3,186.83 2,331.26


i) Disclosure Under Section 22 of the Micro, Small and — —Medium Enterprise

a) Principal amount remaining unpaid to any supplier asat the end of the year 55.06 55.06

b) Interest due and payable upto the end of the last year 93.50 93.50

148.56 148.56

ii) Creditors for accrued wages and salaries include :a). VRS Payable 114.16 114.16b). Income Tax Refundable to Employees 3.87 3.87c). Profession Tax Refundable to Employees 8.49 8.49

The above are still under reconciliation and adjustmentrequired in the Accounts, if any, will be carried out oncethe reconciliation process in completed. 126.52 126.52

11.8311.5223.35

11.8311.5223.35

(i) Gratuity : No provision for gratuity has been made during the curerent financial year since all the employees are on contract basis excepttwo officers. One is on deputation from the Central Government in terms of deputation / engagement and the other being the CMD joinedin January, 2015 from NTPC Ltd.

(ii) The gratuity fund has not so far been created against the said liability.(iii) Leave Encashment : No provision for leave encashment has been made on the same ground as mentioned above. However, actual payment

is charged to revenue accounts as and when payment is made.


35

NOTE -8 OTHER CURRENT LIABILITIES(Rs. In Lakh)


i) Statutory remittances (Contributions to PF and ESIC, Withholding Taxes, Excise Duty, Vat, Service Tax, etc.ii) Interest accrued on Trade Payablesiii) Undisbursed claim of Commissioner of Paymentsiv) Performance Guaranteev) Security Deposit TOTAL


Statutory Remittances includes damages amounting to Rs. 3729 Lakhs and Rs. 1200 Lakhs claimed byESICorporation and PF Commissioner respectively for which waiver has been sought from the CompetentAuthorities in accordance with BIFR Approved Scheme.

NOTE -9 SHORT TERM PROVISIONS(Rs. In Lakh)


Provision for Contingency 189.08 189.08

(on account of Gratuity payable to workmenafter reconciliation)

TOTAL 189.08 189.08

4,245.8069.0940.2957.7352.90

4,465.81

5,203.0969.0940.2967.8664.71

5,445.04


(iii)Sundry creditors includes amount payable to JCI of Rs. 11281750.82 but the JCI has confirmed the balancereceivable from NJMC as Rs. 13974831.00 on 31.03.2015. Therefore the liability in the books of NJMC standsshort by Rs. 2698080.18. This difference is mainly due to non accounting of effects of quality detioration /shortage claim of NJMC Ltd. The recouncilliation is under process and hence no effect has been taken in thebooks of NJMC as on 31.03.2015.


36

NOTE -10 FIXED ASSETS (contd……..)


1) Plant and Equipments include 8 Nos. Herackle Machines pertaining to Unit Alexandra which is lying with a thirdparty on the date of Nationalisation.

2) Land includes Leasehold Land, pertaining to Unit Khardah, the value of which could not be ascertained.3) Land includes 4.48 acres of land of Unit Khardah acquired by Govt. of West Bengal, estimated value of which is

Rs. 0.29 Lakhs as per valuation report dated 31.03.1993 by an independent valuer, for setting up Titagarh ThermalPower Plant of Culcutta Electric Supply Corporation Ltd. Necessary adjustment will be made on receipt ofcompensation amount.

4) Fixed Assets vested under the provision of the Jute Companies (Nationalisation) Act, 1980 on 20th December,1980 with National Jute Manufactures Corporation Ltd., include land and building at 5, Alipore Road, Culcutta,valued at Rs. 8013 Lakhs in respect of Unit-Alexandra but not in possession of the Company. This property wasmortgaged prior to the date of take-over of the Management of the Alexandra Jute Mills Ltd under the Industries(Development & Regulations) Act, 1951 [I (D&r) Act, 1951] and was under an “Agreement to Sale” on the date ofsuch take over. The Sale Agreement was, however, not concluded and was challenged by the Management underthe provision of Industries (Development & Regulations) Act, 1951 at Alipore Court, Culcutta. An Interim order ofinjunction was ultimately issued by the High Court on 8th September, 1981 directing that all further proceedingsat Alipore Court be stayed. Subsequently the mortgagee had filed a writ petition in the Culcutta High Courtchallenging the applicability of the provisions of I (D&R) Act, 1951. Thereafter Alexandra Jute Mills Ltd wasnationalised under Jute Companies (Nationalisation) Act, 1980 with effect from 20.12.1980 and the Assets werevested to this Corporation free from all encumbrances. The mortgagee thereafter another writ petition in theCalcutta High Court challenging the provisions of the Jute Companies (Nationalisation) Act, 1980 and theirvalidity. The Writ Petition filed by the mortgagee challenging the applicability of provisions of Industries(Development & Regulations) Act, 1951 has since been dismissed by the Hon‘ble High Court, Calcutta andthereafter an interim order of status quo is passed by the Hon‘ble High Court, Calcutta.The opinion of standing counsel M/s, Fox & Mondal that premises No.5, Alipore, Kolkata vested in Central Govt.which has again vested in NJMC under Section 6 of the June Companies (Nationalisation) Act. 1980 and NJMCis the owner of the said property free from all mortgages or lien or encumbrances, However, NJMC is the ownerof the said property free from all mortgages or lien or encumbrances, However, NJMC has sought for opinion atthe instruction of MOT vide their letter F. No. 17/16/2006 - JE dated 24/12/2007 in which MOT asked NJMC toexamine the issue from Legal point of view. Accordingly NJMC has referred the matter of Ministry of Law Justice& Company affairs vide letter No. received from Ministry of Law & Justice and Barrister Sri Anindya KumarMitra were forwarded to MOT vide letter No. JNMC/CMD/8 dated 28/01/2008 and also to Barrister Sri AnindyaKumar Mitra on the aforesaid matter. The opinions NJMC/CMD/08/239 dated 3rd April, 2008 along with opinionof our dealing Counsel M/s. Fox & Mondal . The MOT vide their letter No. 17/1/2006 - JE dated 30th April, 2008stated that the opinion of Sri Anindya Kumar Mitra, Barister and Sr. Advocate as well as of Ministry of Law andJustice Branch Secretariat, Kolkata is that the ownership of the premises No. 5, Alipore Road, cannot be deemedas vesting in Central Govt./NJMC under the Nationalisation Act. On the other hand the standing counsel on behalfof NJMC has opined otherwise. MOT further directed that the affidavits in reply on behalf of NJMC and Union ofIndia (MOT) may be amended in the Hon’ble High Court, Calcuta based on the above majority legal opinionwhich included legal opinion from Ministry of Law & Justice branch secretariat Kolkata, that the NationalisationAct, should not be applicable on the said property as the property was no longer a property of Alexandra during thetime of Nationalisation. However, the affidavits were not filed.Since the matter is subjudice no adjustment has been made in the acounts.

5) Value of land pertaining of Unit RBHM, measuring 96 Bighas 15 Kattahs, 5 Dhurs has been capitalised forRs.373.02 Lakhs in 1999-2000 with the approval of Board of Directors on 21.06.2000 as per valuation report as on31.03.93 of M/s Esjay consultants Pvt Ltd. appointed by IIBI.

6) Value of Land includes 4.03 acres of land valued at Rs. 41.55 Lakh and Value of Building includes building valuedat Rs.27.24 Lakh situated at Kalimpong & Forbesgunj of Unit R.B.H.M as per valuation Report as on 31.03.93of M/s Esjay Consultants Pvt Ltd. appointed by IIBI duly approved by the Board of Directors on 24th December,1997 and the same have been capitalised during the year 1997-98

7) The Title deeds of land which were mortgaged to IIBI, has been received by the Company during the year 2006-07.Some of the Title Deeds are torn and in precarious condition. Hence it is not possible to physically verify the same.

8) Plant & Machinery declared as discarded and / or obsolete are shown as current assets at their book value amountingto Rs. 10.99 lakh which is fully provided for


38

NOTE -11 NON CURRENT INVESTMENT (Rs. In Lakh)As at As at As at As at

31st March, 31st March, 31st March, 31st March,2015 2014 2015 2014

Other than Trade Investments Number Number

(A) INVESTMENT IN EQUITY INSTRUMENTS EQUITYSHARES IN SUBSIDIARY COMPANIES-UNQUOTED

14415 14415 Birds Jute & Exports Ltd., Ordinary Share - -(Face value Rs. 100/- each)*

10 10 Birds Jute & Exports Ltd., Ordinary Share - -(Face value Rs. 100/- each)*

143 143 Birds Jute & Exports Ltd., 7% Cumulative Preference Share 0.01 0.01 (Face value Rs. 100/- each)

0.01 0.01

EQUITY SHARES IN ASSOCIATED COMPANIES-UNQUOTED

5 5 The Kinnison Jute Mills Co. Ltd., - - (Face value Rs. 100/- each)*

- - EQUITY SHARES IN CO-OPERATIVE SOCIETIES-UNQUOTED

250 250 Union North Jute Mills Employees‘ Co-Operative Stores Ltd. - - (Face value Rs. 10/- each)*

- -

EQUITY SHARES IN OTHER COMPANIES-QUOTED180 180 Duncans Agro Industries Ltd. (Face value Rs. 10/- each) 0.01 0.01111 111 Birla Corporation Limited (Face value Rs. 10/- each) 0.01 0.0142 42 Cheviot Company Ltd. (Face value Rs. 10/- each)* - -

0.02 0.02

EQUITY SHARES IN OTHER COMPANIES-UNQUOTED

180 180 Hathikhira Tea Co. Ltd. (Face value Rs. 10/- each) 0.01 0.011200 1200 Jaipur Udyog Ltd. (Face value Rs. 10/- each) 0.02 0.02

95 95 Budge Budge Co. Ltd. (Face value Rs. 10/- each) 0.01 0.0195 95 Delta Jute & Industries Ltd. (Face value Rs. 10/- each)* - -20 20 The Ganges Manufacturing Co. Ltd. (Face value Rs.10/-each)* - -

2 2 Anglo India Jute Mills Co. Ltd. (Face value Rs. 100/- each)* - -26 26 The Empire Jute Co. Ltd. (Face value Rs. 10/- each)* - -

600 600 Willard India Ltd. 600 Nos. (Face value Rs. 10/- each) 0.01 0.013 3 Lawrence Investment & Property Co. Ltd. 3 Nos. 0.01 0.01

(Face value Rs. 100/- each)100 100 Waverly Jute Co. Ltd.,(Face value Rs. 50/- each) 0.01 0.01

36972 36972 Britannia Engineering Co. Ltd. (in liquidation) - - (Face value Rs. 100/- each)*

2700 2700 2700 Stock of 1 Pound each in Titagarh Jute Factory PLC 0.11 0.11 (Face value Pund 1/- each)*

0.18 0.18


39

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31ST MARCH, 2015NOTE -11 NON CURRENT INVESTMENTS (contd……..)

Number of Share / Security /Bonds / Units

(B) INVESTMENT IN PREFERENCE SHARES 70 70 J. F. Low & Co. Ltd. (Face value Rs. 100/- each)* - -

- -

(C.) INVESTMENT IN GOVERNMENT SECURITIES3% Conversion Loan 1986 (Face value Rs. 700/- Matured)3% Conversion Loan 1986 (Face value Rs. 5,300/-)7 Years National Savings Certificate :-

Old SeriesNew SeriesThe West Bengal Estate Acquisition Compensation Bonds12 Years National Plan Savings CertificateGovernment of India 5.5% Loan 1999(Face value Rs. 42,500/-)12 Years National Defence Certificate12 Years National Savings Certificate

(D) INVESTMENT IN DEBENTURES-UNQUOTEDEast Indian Clinic Ltd., 5% Non redeemable Debentures 0.36 0.36

0.36 0.36

TOTAL 1.31 1.31Less Provision 1.31 0.90TOTAL - 0.41

* Denotes the Book Value of which is below Rs. 1,000/-.Aggregate Book value of Quoted Non-Current Investment - 0.04Aggregate Book value of Unquoted Non-Current Investmentless Provision - 0.37

Total Quoted and Non-quoted Non-current investment - 0.41

Aggregete Market value of quoted Non Current Investment NA NA

ADDITIONAL INFORMATION(1) Unit : National - Investment of 5 Equity Shares of Rs. 100/- each with Kinnison Jute Mills Co. Ltd. (unquoted) bookvalue Rs. 1/- stand in the name of National Co. Ltd., awaiting transfer in the name of the Corporation.(2) Unit : Union - Certain Investment (Book Value Rs. 8981/-) continued to be registered in the name of the erstwhileUnion Jute Company Ltd.(3) Investments in Government Securities are lodged with Government Authorities/Other Agencies.

U N I T BOOK VALUE (Rs.)NationalUnionKinnisonKhardah

(4) Provision made for doubtful of recovery : U N I TNationalUnionKinnisonKhardahR.B.H.MCorporateAlexanda

0.010.04

0.050.150.010.010.420.010.04

0.74

0.010.04

0.050.150.010.010.420.010.04

0.74

32004632813210

441(Rs.)7857

3117265328

488321340

9033

131486TOTAL


40


NOTE -12 INVENTORIES

(Rs. In Lakh) As at As at


a) Raw Materials (At Lower of Cost or Market price) 351.63 305.02

Add : In Transit - 351.63 - 305.02

b) Work in Process (At Lower of estimated cost or realisable value) 413.34 234.62

c) Finished Goods (At Lower of Cost or Market price) 269.73 691.79

d) Stores & Spares (At or under Cost) 528.16 460.20

Less - Provision for diminution in value 252.42 275.74 252.42 207.78

TOTAL 1,310.44 1.439.21

ADDITIONAL INFORMATIONa) Valuation of closing stock of Raw Materials, Finished Goods, WIP & Stock have been made based on the Physicalquantity as repoted by Stock Auditors and by applying rates at cost or realisable value, whichever is lower.

NOTE-13 TRADE RECEIVABLES(Rs. In Lakh)


Outstanding for a period exceeding six months

Unsecured - Considered Good 466.03 3.26 - Considered Doubtful 190.65 190.65

656.68 193.91Less : Provision for Doubtful Trade Receivables 190.65 466.03 190.65 3.26

-Other Receivables - Considered Good - 264.76

TOTAL 466.03 268.02


41


NOTE-14 CASH AND CASH EQUIVALENTS(Rs. In Lakh)


a) Balances with Banks(i) In current account 205.83 40.30

(ii) In fixed deposit account 21,355.11 18,215.37

(iii) Margin Money 3.10 21,564.04 3.10 18,258.77

Less :- Provision against Mergin Money 3.10 3.1021,560.94 18,255.67

b) Cash in Transit / Draft in Hand - 0.50

c) Cash on hand 0.91 0.26

21,561.85 18,256.43


a) An amount of Rs. 18.10 Lakhs, included in current account with Bank of India as on 31.03.2015 (Previous Year Rs.18.10 Lakhs), has been attached by Certificate officer, Gratuity, for recovery of their dues.

b) An amount of Rs. 1.87 Lakhs, included in current account with Indian Bank as on 31.03.2015 (Previous Year Rs.1.87 Lakhs), has been attached by Provident Fund Commissioner, for recovery of their dues.

c) Drafts on hand as on 31-03-13 on account of retrenchment compensation payable to 6 Nos. of Staff of Unit:Khardah amounting to Rs. 13.15 lakh have since been encashed and kept in bank account of the company. The saidcancellation was made since the Drafts had become stale and in view of uncertainty about final court order to bereceived in this connection, when the said amount would be finnaly adjudicated and payable to the said 6 employ-ees. Necessary provision in respect of this liability has been made.


42

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31ST MARCH, 2015

NOTE -15 SHORT TERM LOANS AND ADVANCES

(Rs. In Lakh)As at As at


a) Loans and advances to related partiesUnsecured - considered good

- considered doubtful

Less: Provision

b) Advances recoverable in cash or kind or forvalue to received

i) Income Tax deducted as Source - Considered good - Considered doubtful

Less:- Provision

ii) Security depositsUnsecured - considered good


Less: Provision

iii) Balances with Government AuthoritiesUnsecured - considered good


Less: Provision

iv) OthersUnsecured - considered good


Less: Provision

TOTAL

307.764,068.264,376.02

4,074.60

166.1214.85

180.97

14.85

75.0411.6086.64

11.60

6.935.17

12.10

5.17

349.39318.68668.07

318.68

307.763,990.054,297.81

3,990.05

227.8614.85

242.71

14.85

85.779.80

95.57

9.80

6.985.17

12.15

5.17

223.72318.68542.40

318.68

301.42

166.12

75.04

6.93

349.39

898.90

307.76

227.86

85.77

6.98

223.72

852.09


43

]NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31ST MARCH, 2015

NOTE -15 SHORT TERM LOANS AND ADVANCES (contd……..)


a) As against total Loans & Advances to Birds Jute & Exports Limited, a Subsidiary of NJMC limited, being a

related party amounting to Rs.4376.02 lakhs( Previous Year Rs.4297.81 lakhs) an amount of Rs.4074.60

lakhs (Previous year Rs.3990.05 lakhs) has been provided for as doubtful of recovery. No provision has been

made for the balance amount Rs.301.42 lakhs.

b) Other Advances recoverable, include:

i) An amount of Rs. 11.33 Lakh in respect of Unit Khardah (Previous Year Rs. 11.33 Lakhs) which represents

misappropriation of money in course of deposit/payment of railway freight in 1982-83. The matter is subjudice.

However, full provision has been made in the accounts.

ii) An amount of Rs. 24.00 Lakhs in respect of Unit National (Previous Year Rs. 24.00 Lakhs) paid to the

Trustees of National Company Limited Jute Mill works‘ Provident Fund as interest free loan to cover the loss

of interest to the fund caused by non receipt of Securities from the Brokers on the condition that the proceeds

from the said securities to be obtained from the Brokers would be appropriated towards refund of the said

loan. Since the proceeds have not yet been realised no adjustment was carried out and full provision has been

made in the accounts.

iii) An amount of Rs. 32.76 lakhs (Previous Year Rs. 32.76 Lakhs) and an amount of Rs. 2.24 Lakhs (Previous

Year Rs. 2.24 lakhs), being the balance of claim towards value of the stock of finished goods and the balance

of claim towards the value of the fixed assets destroyed by fire on 31st August, 1986 respectively pertaining

to Unit National. The insurance claim was finally settled by the National Insurance Company after disallowing

the above balances. The Company referred the matter to the concerned Ministry, New Delhi for further

referring the matter to the arbitrator, as required under the guidelines for settlement of disputes between two

Public Sector Undertakings. The matter has not yet been resolved and full provision against the same has

been made in the accounts.

iv) An amount of Rs. 10.39 lakhs advanced towards VRS Package to officers of the Company which is under

reconciliation. Adjustment required, if any, will be carried out once the reconciliation process is completed.


44


NOTE -16 OTHER CURRENT ASSETS(Rs. In Lakh)


a) AccrualsInterest accrued on deposits

b) OthersOther Current Assets

Less :- Provision


As at As aIncluded in Others are: 31st March, 2015 31st March, 2014

Salvage Value Of Fire Damaged Machinery

Less : Provision -

Machinery Scrap

Less : Provision

Cash Subsidy Receivable:Considered Good - -Considered DoubtfulSub Total :

Less : Provision -

Recoverables From The COP (Jute)

Less : Provision

b) Other Current Assets Rs.205.39 lakhs includes old debit balances with Sundry Creditors amounting to Rs.41.98 lakhs,against which fullprovision has been made. However, necessary steps is being taken for adjustment/recovery of the said amount.

205..39

155.39

0.80

0.80

10.19

10.19

-37.3237.32

37.32

53.86

53.86

114.08

113.41

0.80

0.80

10.19

10.19

37.3237.32

37.32

53.86

53.86

856.14

50.00

906.14

-

-

-

-

-

1,233.45

0.67

1,234.12

-

-

-

-

-


45

3,769.86

3,769.86

1,974.25

60.982

2,035.23

-

0.1460.8460.98

5,812.33

5,812.33

1,761.25

36.87

1,798.12

3.7633.1136.87

1,701.45

59.80

----

3,61--

0.14-

0.01

1,896.04

78.21

-------

0.14--



NOTE -17 REVENUE FROM OPERATIONS(Rs. In Lakh)

For the year ended For the year ended31st March, 2015 31st March, 2014

Sale of Jute Products

ADDITIONAL INFORMATIONSale of products comprises B. Twill Bags.

NOTE -18 OTHER INCOME (Rs. In Lakh) For the year ended For the year ended

31st March, 2015 31st March, 2014a) Interest Income

Interest from Banks on Fixed Deposit (TDS Rs. 167.74 Lakhs Previous Year Rs. 148.78 Lakhs)

Interest income on Loan to a Subsidiary

b) Other Non-operating Income


Govt. of India has sanctioned interest free loan amounting to Rs.483.62 crores for revival of NJMC Ltd. Out of that asum of Rs.415.75 crores has been released till 31.03.15. Unspent amount out of that has been invested in Term Depositfor the time being which has earned an interest amounting to Rs.18.96 crores during the year. The same is beingconsidered as Company’s income consistently since 2011-12. Other non-operating income include the interest earnedfrom security deposit lying with the CESC.

A) Other Non-operating Income a) Rental Income b) Liabilities/provisions no longer required written back

i) Marketing feesii) Doubtful Debts Recover

iii) Doubtful Loans & Advances Recoverediv) On Stores & Sparesv) Cess on Finished Stock

vi) On Officer‘s Gratuityvii) On Officer‘s Leave Encashment

viii) Adjustment on Depreciation Against Govt. Grantix) Govt. Authority (Excise)x) Others

c) Miscellaneous Income

During the year on loans & advances given to the Subsidary amounting to Rs.301.42 lakh, interest has been considered and credited to profit& loss account amounting to Rs.78.21 lakh considering interest rate of 18.5% on cumulative basis in absence of specific direction from GOIin view of over all status of the loan, the provision has been made against the total amount of interest Rs.192.04 lakh as doubtful of recovery.

46

60.98

295.04

-

295.04

2,318.40

691.79

234.61926.40

6.61

269.74

413.34

500.66

5.74

494.92

3,065.96

876.79

178.231,055.02

-

691.79

234,61

2,613.44

351.63

2,261.81

933.01

683.08

-

(249.93)

3,560.88

295.04

3,265.84

1,055.02

926.40

6.61

(122.01)



NOTE -19 COST OF RAW MATERIALS CONSUMED(Rs. In Lakh)


Opening Stock

Less : Jute in Transit

Add : Purchase

Less :- Closing stock

Cost of Raw Materials Consumed


i) Raw Materials consumed comprises :- Raw Jute

ii) Indegenous 100% 100%

NOTE -20 CHANGES IN INVENTORIES OF FINISHED GOODS AND WORK-IN-PROCESS(Rs. In Lakh)

For the year ended 31st March, 2014

Inventories at the beginning of the year

Finished Goods

Work in Process

Adjustment of Stock

Inventories at the end of the year

Finished Goods

Work in Process

Adjustment of Stock

Net increase / (decrease)

For the year ended31st March, 2015

47


NOTE -21 EMPLOYEE BENEFITS EXPENSES (Rs. In Lakh)


Salaries

Contribution to Provident Fund

Welfare Expenses

TOTAL

NOTE 22 FINANCE COSTS

Interest expenses on Borrowings

195.13

0.71

24.16

220.00

30.92

30.92

91.45

1.95

68.75

162.15

30.25

30.25

(Rs. In Lakh)For the year ended31st March, 2015


30.92

30.92



48


NOTE -23 OTHER EXPENSES (Rs. In Lakh)


a) Manufacturing Expenses

Wages through Contractors

Consumption of stores and spares

Power and fuel

Branding charges

Repairs and maintenance - Buildings

Repairs and maintenance - Machinery

Repairs and maintenance - Others

b) Administrative Expenses

Rent

Rates and taxes

Insurance

Services Outsourced

Security Expenses

Professional Charges

Vehicle Maintenance

Travelling and Conveyance

Communication

Printing and stationery

Electricity Charges

Data Processing & Service Charges

Hire Charges

Transit Camp Expenses

Legal Charges

Interest on Gratuity, I.T. & Others

Bank Charges

Provision for doubtful trade and other receivables

Prior period items

Miscellaneous expenses

1,571.78

166.75374.75

(5.42)5.57

17.1857.96

2,188.57

16.7844.91

18.11-

195.1943.34

17.6210.34

4.083.73

41.8153.52

-0.45

24.8318.79

0.35141.27

19.6610.90

665.68

2,440.05

358.37

523.79

39.55

80.81

116.92

46.47

3,605.96

19.40

23.77

24.56

420.12

161.75

49.03

21.91

26.57

6.08

6.89

60.14

16.53

1.05

3.87

4.23

8.24

0.92

129.37

(17.32)

13.07

980.18


49


Auditors’ Remmuneration :

i) Statutory Audit Fees

ii) Tax Audit Fees

iii) Cost Audit Fees

iv) Others Audit Fees

c) Selling and Sistribution Expenses

Advertisement

Shipping and Delivery charges

TOTAL


i) Prior Period items includes (Net)

Prior Period Expenses

Less : Prior Period Income

NOTE -24 EARNING PER SHARE

Profit / (Loss) after tax as per Statement of

Profit and Loss (Rs. In Lakh)

Weighted average Number of equtity share

Earnings per share (Rs.) - Basic

Earnings per share (Rs.) - Diluted

1.370.45

0.971.78

4.57

5.2455.20

60.442,919.26

31.8412.18

19.66

(48.64)

557974

(8.72)

(8.72)

1.35

0.45

0.97

-

2.77

11.69

25.48

37.17

4,626.08

7.54

24.86

(17.32)

(655.08)

557974.00

(117.40)

(117.40)


(Rs. In Lakh)For the year ended 31st March, 2014



(Rs. In Lakh)For the year ended 31st March, 2015


(Rs. In Lakh)


50


NOTE -25

1) These Financial Statements incorporate the Accounts pertaining to the Units of Corporate Office, Kinnison,RBHM, Khardah, National, Union and Alexandra.

2) Related Party Transactions

i) Details of Parties :

Description of Relationship Name of related Parties

Holding Company National Jute Manufactures Corporation Limited

Subsidiary Birds Jute & Exports Limited

Key Management Personnel Nil

Note :- Related parties have been identified by the Management

ii) Details of related party transaction during the year ended 31 March 2015 and balances outstanding as at 31 March 2015

a) With subsidiary company:

Particulars Subsidiary

Rs. / Lakh

Provision against the above balance is mentioned in note no. 15(a)

b) Key Managerial Personnel : Nil

4,297.81

-

-

78.21

4376.02

Opening Balance as on 01-04-2014

Transactions during the year

Fresh Advance(Net) .

Fresh Loan (Net) .

Interest charged

Closing Balance as on 31-03-2015

CURRENT YEAR


51


3) Particulars As at As at31st March, 2015 31st March, 2014

The following Stocks belonging to ProcessingAgent (Third Party) are lying at Units Kinnisonand Khardah:

Work in Process 281 M.T 281 M.T

Finished Goods 21 M.T 21 M.T

The above stocks belong to a third party as confirmed by the management by way of a certificate.The same has not been verified by the stock auditors as at 31-03-2015.The said stocks has no impact in the company’s accounts / financial statements.

4) Particulars As at As at31st March, 2015 31st March, 2014

Interest Accrued on House Building Loans to Nil Nilemployees by SBI Home Finance Limited iscredited to Staff Welfare Account.

Corresponding Debit is booked in Prior Period Nil NilAdjustment Account.

5) Employee Benefits expenses include Director‘s Remuneration as below :-

Particulars Current Year Previous Year

Remuneration 16.05 12.02

Contribution to P.F. Fund 0.71 1.12

Gratuity — -

6) Employee benefit plans

i) Defined contribution plans The Company makes Provident Fund contributions to defined contribution plans for qualifying employees.

Under the Schemes, the Company is required to contribute specified percentage of the payroll costs, to fund the benefits.

The company offers the Gratuity & Leave Encashment benefits plan to the employees :-(ii) Benefits in the current year has not been accounted for since the Company has only one employee on its pay roll and the same will be duly accountated for as and when payable


52

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31ST MARCH, 2015.(Rs. In Lakh)


7) Expenditure in Foreign Currency Nil Nil

8). The Company‘s operations pertain to manufacture and selling of single Jute Product for sale in the DomesticMarket only. As such reporting under Accounting Standard 17 (Segment reporting under Section 211(3)( C ) is notapplicable).

9). In view of the continuous losses incurred by the Company since its inception, Deferred Tax Assets have not beenrecognized as there is no reasonable certainty that sufficient future taxable income would be available againstwhich such Deferred Tax Assets can be adjusted. No provision forTax is required due to accumulated losses of theCompany.

10). Since the Written Down Value of 90% of the Fixed Assets of the Company has attainted the residual valueof therequirements of Accounting Standard 28 dose not arise.

11) Contingent liabilities and commitments not provided for

SL. Particulars As at As atNo. 31st March, 2015 31st March, 2014

A) Contingent Liabilities

i) Claims against the Company not acknowledged 21.35 21.35as debt towards Central Excise for Unit Kinnison

ii) Guarantees extended by the Corporation to SBI 0.97 0.97Home Finance Ltd for granting House BuildingAdvance to the employees of this Corporation

iii) Guarantee issued to Sales tax Authority by the 0.50 0.50 banks on behalf of the Company

B) Commitments Estimated Amount of contracts remaining to be - - executed on Capital account and not provided for

22.82 22.82

12) Figures of the previous year have been regrouped / rearranged in conformity with those of the current year.

For Nag & AssociatesChartered AccountantsRegistration No.312063E






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