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3Oth Annual Report 2001-:
VBC Industries Limited
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VBC Industries Limited
BMlttof Directors
Dr.f&V.V.S.Murthi.M.P. Chairman (Non-Executive) Q,i, Tandon, Padma Bhushan RXR Gonela, I.A.S. (Retd.) O. Swaminatha Reddy M.K. Raju KJ£. Purohit VJuRao Managing Director
Audit Committee K.S, Purohit Chairman (Non-Executive) R.K.R. Gonela, I.A.S. (Retd). Non-Executive Member O. Swaminatha Reddy Non-Executive Member
Shareholders Grievances Committee R.K.R. Gonela, I.A.S. (Retd), Chairman (Non-Executive) G.L. Tandon Non-Executive Member V.S, Rao Managing Director
Remuneration Committee R.K.R. Gonela, I.A.S. (Retd). Chairman (Non-Executive) GJ_. Tandon Non-Executive Member K.S. Purohit Non-Executive Member
Company Secretary 30th Annual General Meeting Viswanatha E.N: Day : Saturday
Date : 21st September, 2002 .
Time : 10.30 A,M.
Place : Registered Office, . Visakhapatnam - 530 007
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Auditors Brahmayya & Company 'SUHASINI1 10-50-24 Siripuram Junction VISAKHAPATNAM - 530 003
Registrars and Share Transfer Agents Venture Capital and Corporate Investments Limited 6-2-913/914, III Floor, Progressive Towers Khairatabad HYDERABAD-500 004
Bankers ICICI Bank Limited T.G.V. Mansion Khairatabad Branch HYDERABAD - 500 004
Registered Office: A-4 Unit, Industrial Estate VISAKHAPATNAM - 530 007
Corporate Office: 6-2-913/914, Ml Floor, Progressive Towers Khairatabad HYDERABAD-500 004
Members are requested to bring this Annual Report to the Meeting.
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VBC Industries Limited NOTICE OF 30th ANNUAL GENERAL MEETING OF THE COMPANY
NOTICE is hereby g^n that Thirtieth Annual General Meeting of Members-of VBC Industries Limited will be held on Saturday, the 21st September, 2002 at 10.30 a.m. at the Registered Office of the. pornpany at A-4 Unit, Industrial Estate, Visakhapatnam - 530 007 to transact the following business:
ORDINARY BUSINESS: 1. To receive, consider and adopt the Audited Profit and Loss Account of the company for the financial year ended 31st March, 2002 and Balance Sheet as on that date together with Reports of Directors and Auditors thereon.
2. To appoint-a Director in place of Sri M. K. Raju who retires by rotation and being eligible offers himself for re^appointment.
3. To appoint a Director in place of Sri G. L. Tandon who retires by rotation and being eligible offers himself for re-appointment.
4. To appoint' Auditors for the financial year 2002-2003 and to fix their remuneration.
To consider and if thought fit to pass the following resolution with or without modification (s) as an ordinary resolution:
"RESOLVED THAT M/s. Brahmayya & Co., Chartered Accountants, Visakhapatnam be and are hereby reappointed as the Auditors of the Company to hold the office from the conclusion of this Annual General Meeting tiH the conclusion of the next Annual General Meeting at such remuneration as may be decided by the Board of Directors and reimbursement of out-of-pocket expenses and fees for other services".
SPECIAL BUSINESS: '
5. To re-appoint Sri V S Rao as Managing Director of the Company and fixation of managerial remuneration:
To consider and if thought fit, to pass with or without modification (s) the following resolution as an ordinary resolution: 1* RESOLVED THAT pursuant to provisions of sections 198,269,309,310 and other applicable provisions of the Companies Act, 1956, if any, read with schedule XIII of the Companies Act, 1956 or any amendment or modification thereto and in accordance with Article 138 to 142 of Articles of Association of the Company, Sri V S Rao be and is hereby re-appointed as Managing Director of the Company for a further period of 5 years with effect from 26.06.2002 with such duties and powers as may be delegated to him by the Board of Directors / Chairman of the Company from time to time on no remuneration basis.
6. To appoint Sri R K R Gonela as Director of the Company:
To consider and if thought fit, to pass with or without modification (s) the following resolution as an ordinary resolution: *, RESOLVED THAT Sri R K R Gonela, who was appointed as additional Director of the Company .under section 260 of the Companies Act, 1956 and in respect of whom the Company has received a notice in writing under section 257 of the Companies Act, 1956 together with requisite deposit proposing his candidature for the office of the Director and who is eligible for appointment, be and is hereby appointed as an independent non-executive director of the Company and whose period of office Is liable for determination by retirement on rotation.
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7. To delist the securities of the Company on Madras Stock Exchange Limited:
To consider and if thought fit, to pass with or without modification (s) the following resolution as Special Resolution:
RESOLVED THAT pursuant to the applicable provisions of the Companies' Act, T956, Securities Contracts (Regulations) Act, 1956 and Rules framed thereunder, Listing Agreements and all other applicable laws, rules, regulations and guidelines and subject to such approvals, permissions and . sanctions, as may be necessary and subject to such conditions and modifications as may be prescribed or imposed by any authority while granting such approvals, permissions and sanctions which may be agreed to by the Board of Directors of the Company (hereinafter referred to as the Board which term shall be deemed to include any Committee thereof for the time being exercising the powers conferred on the Board by this resolution), approval of the Company be and is hereby accorded to the Board for voluntarily delisting of the Equity Shares of the Company from Madras - Stock Exchange Limited.
RESOLVED THAT the Board of Directors of the Company including any Committee (s) thereof formed for the time being to exercise the powers conferred by the Board be and is hereby authorised to take all necessary steps in this regard and do all such acts, deeds, matters and things as it may in its absolute discretion deem necessary, proper or desirable and settle any question, difficulty, doubt that may arise in regard to voluntary delisting of Equity Shares from Madras Stock Exchange Limited and to execute all such deeds, documents, writings as may be necessary, expedient or desirable as it may deem fit and for this purpose delegate the authority duly vested in it by virtue hereof to any Director or Company Secretary or any other person who it may consider suitable to do the acts, deeds and things required to give effect to this resolution.
BY ORDER OF THE BOARD
Place : Hyderabad VISWANATHA E.N. Date : 22.06.2002 Company Secretary
NOTES : 1. The Explanatory Statement pursuant to Section 173 (2) of Companies Act, 1956 in respect of 'Special Business item no. 5, 6 and 7 is annexed hereto, 2. A member entitled to attend and vote at the meeting is entitled to appoint a proxy to attend and vote on a poll instead of himself and such proxy need not be a member of the Company. .3. A proxy, in order to be effective must be received by the Company in not less than 48 hours before the commencement of the meeting, 4. The Register of Members and Share Transfer books of the Company shall remain closed from 19.09.2002 to 21.09.2002 (both days inclusive). 5. Shareholders who have not encashed their interim dividend warrants for the year 2000-2001 may surrender their dividend warrants to the Corporate Office for revalidation. 6. Shareholders holding their shares in multiple folios are requested to consolidate their holding in one single folio. 7. Members are requested to intimate their change of address to Registrars and Share Transfer Agents, M/s. Venture Capital and Corporate Investments Limited, 6-2-913/914, 3rd Floor, Progressive Towers, Khairatabad, Hyderabad - 500 004.
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VBC Industries Limited
8. Members desirous of making nomination in respect of their share holding are requested to submit Form .28 to the Registrars and Share Transfer Agents.
9. Shareholders are requested to avail the facilities of converting their physical .shareholdings into electronic mode of shareholdings for their own convenience,
10. Shareholders holding their shares in demat form are requested to bring details of their Depository account number for identification.
11. The Company's Equity Shares are listed on i) The Hyderabad Stock Exchange Limited, 3-6-275, Himayatnagar, Hyderabad - 500 029, ii) The Stock Exchange, Mumbai, Phiroze Jeejeebhoy Towers, Dalai Street, Mumbai - 400 007 and ill) Madras Stock Exchange Limited, Exchange Building, 11, Second line Beach, Chennai - 600 001.
The Company had paid the Annual Listing Fees for the year 2002-2003 to the aforesaid Stock Exchanges.
12. Members/Proxies are requested to bring duly filled in attendance slips at the meeting.
13. Statutory Registers and records are available at the place of meeting for inspection by the members till the conclusion of the meeting.
EXPLANATORY STATEMENT AS REQUIRED UNDER SECTION 173 (2) OF THE COMPANIES ACT, 1956.
Item no. 5 ,
Sri V S Rao was appointed as Managing Director of the Company for a period of 5 years with effect from 26.06.1997 and his period of office expires on 25.06.2002. The Company has started executing Hydel Power Projects in the State of Orissa and Andhra Pradesh. In the interest of execution of Hydel Power Projects, the Board of Directors has re-appointed Sri V S Rao as Managing Director of the Company for a period of 5 years with effect from 26.06.2002 in the Board of Directors meeting held on 23.03.2002.
Sri V S Rao is a Graduate Engineer in Mining from College of Engineering, Qsmania University. He has worked in TISCO for nearly 36 years in various capacities and has acquired vast skill, knowledge and experience during the tenure of his service. In order to utilise his expertise and experience gained by him during the course of his service with the Company, the Board of Directors thought fit to re-appoint him as Managing Director of the Company for a further period of 5 years with effect from 26.06.2002 in the over all interest of the Company, subject to approval of members at this meeting.
The terms of re-appointment is set out in the proposed resolution which shall be treated as an abstract of terms of appointment and memorandum of interest of Managing Director as contemplated under section 302 of the Companies Act, 1956.
Sri V S Rao is also Managing Director of Orissa Power Consortium Limited.
None of the Directors are interested or concerned in the proposed resolution except Sri V S Rao.
Your Directors commend the proposed, resolution for your approval.
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Item no. 6
Sri R K R Gonela, I.A.S. (Retd) was appointed as additional Director by the Board of Directors in its meeting held on 23.03.2002 and his period of office expires at the conclusion of this meeting. A notice was received from member proposing his candidature for the office of Director together with requisite deposit as required under section 257 of the Companies Act, 1956.
Sri R K R Gonela was a Graduate from Madras University and possess Degree in Law from Delhi University. Sri R K R Gonela joined Indian Administrative Service in 1963 in AP cadre. During the tenure of his services, he held the positions of Secretary to Government of Andhra Pradesh, Secretary for Finance, industries and Social Welfare, Chairman VPT, Vice-Chairman and Managing Director of APIDC, Managing Director of Godavari Fertilizers and Chemicals Limited, Commissioner Land Revenue. He retired in the year 1997 as Special Chief Secretary to Government of Andhra Pradesh. He also held the position of Pay Revision Commissioner of Government of Andhra Pradesh. While holding the positions in different capacities, Sri R K R Gonela was involved in Industrial Policy, Industrial Development and Industrial Management of Andhra Pradesh Government.
In view of his rich experience and expertise in various industrial related activities, the Board of Directors of your Company thought fit to appoint him as Director of the Company in the overall beneficial interest of the Company.
None of the Directors are interested or concerned in the proposed resolution except Sri R K R Gonela.
Your Directors commend the proposed resolution for your approval.
Item no. 7
At present, the Equity Shares of the Company are listed on The Hyderabad Stock Exchange Limited, The Stock Exchange, Mumbai and Madras Stock Exchange Limited. Due to depressed capital market condition, the Equity Shares of the Company are not traded frequently on all the Stock Exchanges and therefore offer no liquidity in trading. As a result, there is no official quotation for the Equity Shares listed on the respective Stock Exchanges. Moreover, the listing fees being paid to the Stock Exchanges are exorbitant in relation to the services being rendered by the Stock Exchanges.
In terms of listing requirements, the securities of the Company shall be listed on Regional Stock Exchange and on one or more other recognised Stock Exchanges in India. Accordingly, it is thought fit to delist the Equity Shares of the Company listed on Madras Stock Exchange Limited and to retain its listing only on The Hyderabad Stock Exchange Limited , a Regional Stock Exchange and The Stock Exchange, Mumbai , a non-regional Stock Exchange as a measure of economy. In the opinion of the Board of Directors that the aforesaid proposal of delisting does not adversly affect the interest of the shareholders of the Company.
None of the Directors are interested or concerned in the proposed resolution except those Directors to the extent the Equity Shares are held by them.
Your Directors commend the proposed resolution for your approval.
BY ORDER OF THE BOARD
Place : Hyderabad VISWANATHA E.N. Date : 22.06.2002 Company Secretary
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VBC Industries Limited REPORT OF THE BOARD OF DIRECTORS
Your Directors take pleasure in presenting the 30th Annual Report of the Company together with Audited Financial Statement for the year ended 31st March, 2002.
1. Financial Results: 4. OPCLhasbeendeclaredasGeneratingCompany. During the financial year under review, there were no commercial operations. However the 5. Engineering, Procurement and Construction Company has earned an income of Rs. 66.43 lacs contract was executed on 26th December, 2001 as against Rs.161.32 lacs in the previous year, with M/S. VA Tech Escher Wyss Flowel Limited, in the form of interest on Term Deposits with the Faridabad by OPCL. Banks. The Company has made a provision for tax to the extent of Rs.22.00 lacs. The Company 6. Orissa Pollution Control Board hasgiven clearance has earned a profit after tax of Rs.20.23 lacs for the site for implementation of project. as against Rs.583.35 lacs in the previous year. 7. Arrangement is being made with Power Trading 2. Dividend: Corporation for sale of energy and finalisation of PPA with PTC is under consideration. OPCL has The Board of Directors of your Company regret secured permission from GRIDCO to sell the power to inform the shareholders of the Company that to PTC for 10 years. the company is not in a position to declare any dividend in the absence of operational profit. 8. All requisite statutory clearances / approvals / permissions from the department concerned have 3. Fixed Deposits: been obtained by OPCL. The Company has not accepted any Fixed Deposits from the public during the period under 9. Discussions with GRIDCO officials for wheeling review within the meaning of section 58 A of agreement under progress. the Companies Act, 1956. 10. Owners Engineer contract was finalised with 4. Future Prospects: M/s. Lahmeyer International (India) Private Limited, New Delhi on 12th March, 2002 by OPCL. As informed in the previous report of directors, the Company has taken up Three Hydel Power 11. Evacuation scheme was being finalised with Projects located at Samal, Jalaput and Balimela GRIDCO and tenders were invited for construction in collaboration with Orissa Power Consortium Limited. of 132 KV DC transmission line between Samal The highlights of the progress of each project achieved and Sarang by OPCL. by Orissa Power Consortium Limited (OPCL) in brief are given hereunder for the information of B) Jalaput Hydro Electric Project - 18 MW: shareholders. Your Directors foresee bright prospects in power sector in the light of liberalisation 1. Land required for setting up of power project policy and encouragement to mini hydel independent was in the possession of APGENCO. OPCL has power projects. applied to APGENCO for giving the required land on lease. A) Samal Hydro Electric Project - 20 MW: 2. OPCL has been registered and approved as 1. The department of water resources has already Generating Company by Government of Andhra issued G.O. for surrender of 8.97 hectares of land Pradesh and notification to that effect was published to OPCL on lease basis and advised Revenue in official gazette on 7th May, 2002. Department to provide the land on lease basis. 3. State Technical Committee of Orissa has already 2. Out of four plots of private land, three plots approved DPR and Techno economic clearance was have already been acquired and registered and also received from Government of Orissa on 29th remaining one plot will be acquired shortly by OPCL. December, 2001. APTRANSCO has also recommen- ded to Government of Andhra Pradesh for according 3. Layout of the Plant has been finalised. necessary approval of DPR which is under consideration of Government of Andhra Pradesh.
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4. Rapid EIA report was submitted to AP Pollution b) That the directors have selected such accounting Control Board and public hearing was conducted policies and applied them consistently and made on 8th May, 2002. Presentation before Technical judgements and estimates that are reasonable and Committee of AP Pollution Control Board was also prudent so as to give a true and fair view of made on 1st June, 2002. state of affairs of the Company at the end of financial year ended 31st March, 2002 and of 5 Engineering, Procurement and Construction the Profit or Loss of the Company for that period. contract was finalised with LMZ Energy India Limited and formal contract would be completed after receiving c) That the directors have taken proper and techno economic clearance from CEA. sufficient care for the maintenance of adequate accounting records in accordance with the provisions 6. AP TRANSCO has agreed in principle for 132 of this Act for safeguarding the assets of the KV DC line from Jalaput to be connected at Sogur Company and preventing and detecting fraud and to 132 KV Machkund-Araku line. Formal communication other irregularities. in this regard is expected from AP TRANSCO. Work d) That the directors have prepared the Annual of route alignment, survey, tower spotting has been Accounts for the period ended 31st March, 2002 awarded to a local agency at Visakhapatnam and on a going concern basis. the same is expected to be completed shortly. 7. Directors: C) Chitrakonda Dam Toe Hydro Electric In accordance with the provisions of the Project - 60 MW: Companies Act, 1956 and Articles of Association of the Company Sri M K Raju and Sri G L Tandon 1. After approval from Government of Orissa, retire by rotation at the ensuing Annual General notification under section 29(2) under Indian Electricity Meeting and being eligible, offer themselves for re- Supply Act, 1948 was published in local news appointment. papers. Sri M K Raju is a management expert of 2. The revised DPR is under preparation based international repute. He has over five decades of on the revised quotation. industrial experience and held top executive positions in both Private and Public sector organisations. At 3. Tenders for EPC contract were floated and present, he is Chairman of M K Raju Consultants competitive bids for the same have been received Private Limited. and under evaluation. In view of his vast experience in the field of 4. Meeting was held with AP GENCO forfinalisation Management Consultancy, the Board of Directors ofpricefortransferof Plant and Machinery. Consensus of the Company thought fit to re-appoint him as was reached on the transfer of price and approval Director of the Company in the overall beneficial from the Government of Andhra Pradesh is awaited. interest of the Company, subject to the approval of the Members at this meeting. 5. Personnel: Your Directors recommend the members for The provision of Section 217 (2A) of the approval of re-appointment of Sri M K Raju as Companies Act, 1956 read with Companies an independent non-executivedirectoroftheCompany (Particulars of Employees) Rules, 1975 is not in the best interest of the Company. applicable to the Company, since no employees draws the remuneration in excess of the limits None of the Directors are interested or concerned prescribed therein. in the proposed re-appointment as a Director of the Company, except Sri M K Raju. 6. Directors responsibility statement: Pursuant to the provisions of Section 217 (2AA) Sri G L Tandon completed his education in of the Companies Act, 1956, the directors confirm, Indian School of Mines, Dhanbad in 1951. During his association with Bengal Coal Company, he a) That in preparation of Annual Accounts for acquired rich and varied experience in deep the period ended 31st March, 2002, applicable underground coal mines. During the tenure of his accounting standards have been followed. service with NMDC, he possessed vast experience
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VBC Industries Limited in geological investigations, exploration, planning, Your directors recommend to the members the development and management of India's majorminera! appointment of Sri R K R Gonela as an independent projects. He served Neyveli Lignite Corporation non-executive Director of the Company in the best Limited as Chairman and Managing Director and interest of the Company. during his tenure of service, he was instrumental in turning around the performance of the Company 8. Corporate Governance Report: and ecological upgradation in mining areas. A separate Report on Corporate Governance He also served Coal India Limited as Chairman is annexed forming a part of Annual Report of and during the period of his service, he introduced the Company in terms of compliance of requirement various management systems, eco-friendly of Clause 49 of the Listing Agreement with Stock environmental system and computerisation. Among Exchanges (Annexure-l). many awards, the prestigious award bestowed on him is Padmabhushan by President of India 9. Auditors: in 1986 for his extra-ordinary managerial capabilities M/s. Brahmayya & Co., Chartered Accountants, and social welfare services rendered to industry Visakhapatnam retire at the conclusion of ensuing and society . He was recognised as "Engineering Annual General Meeting and being eligible, offer personality of the Country" by the Institute of Engineers themselves for re-appointment as Auditors of the in 1994. He is associated with many public and Company. They have furnished a certificate to private sectors in the capacity of the Director and the effect that the proposed re-appointment, if Chairman. made, will be in accordance with the provisions of section 224 (1-BJ of the Companies Act, 1956. Your directors recommend to the members the The notes to the accounts referred to in Auditors' re-appointment of Sri G L Tandon as an independent Report are self explanatory. non-executive Director of the Company in the best interest of the Company. 10. Conservation of energy, technology Noneof the Directors areinterested or concerned absorption and foreign exchange earnings/ in the proposed re-appointment as a Director of out go: the Company, except Sri G L Tandon. The information as required under section 217 (1) (e) of the Companies Act, 1956 read with The brief particulars and justification of re- Companies (Disclosure of Particulars in the Report appointment of Sri V S Rao as Managing Director of Board of Directors) Rules, 1988 is not applicable of the Company are given in the respective to the Company in the absence of business operations. Explanatory Statement annexed herewith. Sri R K R Gonela, IAS (Retd) was nominee 11. Cash Flow Statement: director on the board representing APIDC. On A Cash Flow Statement for the period ended withdrawal of his nomination from the Board by 31.03.2002 is annexed forming a part of Annual APIDC, the Board of Directors of the Company thought Report in compliance with the requirement of Clause fit to appoint him as an additional director with 32 of the Listing Agreement with Stock Exchanges effect from 23.03.2002 in the meeting of the Board (Annexure-ll). of Directors held on 23.03.2002 and his period of office expires at the conclusion of this meeting. 12. Acknowledgement: Sri R K R Gonela expressed his willingness to Your Directors wish to express their appreciation be appointed as Director if the members approve of services rendered by the employees of the the same and he has complied with the requirement Company and also express their gratitude to of provisions of section 257 of the Companies the Shareholders, Banks, State Government and Act, 1956. In the event, Sri R K R Gonela is appointed theiragenciesfortheircontinued support, co-operation as an independent non-executive director, his office and guidance. will be determined by retirement on rotation. BY ORDER OF THE BOARD
Place Hyderabad M.V.V.S. MURTHI Date 22.06.2002 Chairman
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