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					                                                                                                         BALLARPUR INDUSTRIES LIMITED


ANNEXURE TO DIRECTORS' REPORT
                                                                        FORM - A
                       DISCLOSURE OF PARTICULARS WITH RESPECT TO CONSERVATION OF ENERGY

A. Power and Fuel Consumption
                                                                   CURRENT YEAR - 2000-2001(12 Months) PREVIOUS YEAR - 1999-2000(12 Months)
                                                                        PAPER      CAUSTIC            RAYON            PAPER         CAUSTIC         RAYON
                                                                                     SODA             GRADE                            SODA          GRADE
                                                                                                        PULP                                           PULP

1.   ELECTRICITY
     (a) Purchased
          UNITS                                     ‘000 KWH            27,314          7,763           8,818          34,760           7,688         7,537
          TOTAL AMOUNT                                  Rs.Lacs        1,084.04        255.42          431.99        1,227.98          267.01        361.51
          RATE / UNIT                                        Rs.           3.97          3.29            4.90            3.53            3.47           4.80
     (b) Own generation
          (i)    Through Generator
                 - D.OIL/LSHS/HSD
                 UNITS                                '000 KWH               0                0               0               0               0           0
                 Units per litre of D. OIL/LSHS/HSD       KWH              0.00          0.00            0.00            0.00            0.00           0.00
                 Cost per unit                               Rs.           0.00          0.00            0.00            0.00            0.00           0.00
          (ii)   Through Steam Turbine /
                 Generator
                 UNITS                              ‘000 KWH           3,15,372        37,481          82,814        3,04,948          42,579        82,143
                 Units of Power per MT of coal            KWH            1,291          1,593            332            1,345           1,620           354
                 Cost per unit                               Rs.           1.76          2.01            0.76            1.63            1.86           0.76
2.   COAL
     (Quality used in boilers
     GRADES : B,C,D, etc.)
          QUANTITY                                         M.T.        3,73,673         2,270          90,877        3,53,004           3,111        96,135
          TOTAL COST                                    Rs.Lacs        5,181.25         35.06        1,072.83        4,951.99           42.71       1,151.82
          Average rate                                  Rs./M.T.       1,386.57      1,544.65        1,180.53        1,402.82         1,372.79      1,198.13
3.   FURNACE OIL/LSHS/LDO/RFO
        QUANTITY                                           K.L.            826                0         8,485           1,380                 0       8,345
          TOTAL COST                                    Rs.Lacs          85.92           0.00          982.77          130.39             0.00       941.53
          Average Rate                                  Rs./K.L.     10,408.24           0.00       11,582.44        9,449.92             0.00     11,282.56
4.   OTHERS / INTERNAL GENERATION ETC.
        (BLACK LIQUOR SOLIDS FIRED,
        WASTE HEAT RECOVERY, LPG)
        QUANTITY ( COAL EQUIVALENT )                       M.T.        2,12,273               0               0      2,08,463                 0           0
          TOTAL COST                                    Rs.Lacs        2,998.55          0.00            0.00        2,849.97             0.00          0.00
          Average Rate                                  Rs/M.T.        1,412.59          0.00            0.00        1,367.13             0.00          0.00


B. Consumption per Unit of Production

                                            ELECTRICITY                    COAL                      FURNACE OIL                    OTHERS/INTERNAL
                                           (KWH/TONNE)                 (M.T./ TONNE)                 (K.L./ TONNE)                    GENERATION
                                                                                                                                      (M.T./TONNE)
                                     CURRENT          PREVIOUS       CURRENT      PREVIOUS        CURRENT         PREVIOUS        CURRENT         PREVIOUS
                                         YEAR              YEAR          YEAR          YEAR           YEAR             YEAR           YEAR             YEAR
                                     2000-2001        1999-2000      2000-2001    1999-2000       2000-2001       1999-2000       2000-2001       1999-2000

     PAPER                                  1,421         1,436          1.549        1.492           0.003           0.006           0.880           0.881
     CAUSTIC SODA                           3,081         3,063          0.155        0.190           0.000           0.000              –                –
     RAYON GRADE PULP                       1,026           999          1.018        1.071           0.095           0.093              –                –




                                                                             30
BALLARPUR INDUSTRIES LIMITED

                       DISCLOSURE OF PARTICULARS WITH RESPECT TO CONSERVATION OF ENERGY

Energy Conservation Measures Taken, Results Achieved & Plans for the Future
Specific Measures taken during the year 2000-2001 :

1.   Improved operation of Coal Boilers and monitoring of flue gas has led to a reduction in coal consumption.

2.   Reduction of Raw water intake through recycling of water has led to lower power consumption.

3.   Reduction in consumption of Purchased Power through Improved Power Factor & better loading on own Power Plants.

4.   Steam saving by increasing the blow heat recovery efficiency.




                                                                      FORM - B
                                    FORM FOR DISCLOSURE OF PARTICULARS WITH RESPECT TO
                                     TECHNOLOGY ABSORPTION, RESEARCH & DEVELOPMENT

1.   Specific areas in which R & D                    —    Development of new / Better varieties of Paper.
     carried out by the Company :
                                                      —    BILT Copy Power with improved stiffness and Photocopying
                                                           properties.
                                                      —    ARSR grade paper for Soap wrapping.
                                                      —    Improvement of paper formation in Maplitho Premium through
                                                           optimisation of wet end process.
                                                      —    Improvement of printing performance of Easy Print Paper by
                                                           modifying the size press recipe.
                                                      —    Dev. & plant scale evaluation of green liquor desilication process to
                                                           achieve Lime Mud Reburning.
                                                      —    Work initiated on Environment Management System to achieve
                                                           ISO-14001.
                                                      —    Utilisation of Mango Wood, Cassia Semia and Acacia in fibrous raw
                                                           material furnish.
                                                      —    Laboratory study on Cationic Rosin for reduction in Alum composition.
                                                      —    Development of Spills collection system to recover fibre.

2.   Benefits derived as a result                      —    Improvement in paper quality and development of new grades of paper.
     of above R & D :
                                                      —    Improvement in process efficiency.
                                                      —    Import substitution.

3.   Future Plan of Action :                          —    Improving pulp brightness and brightness stability.
                                                      —    Reduction in Water Consumption.
                                                      —    Reduction of Fibre losses.
                                                      —    Environmental Management System.

4.   Expenditure on R & D (including                  a.   Capital (incl. WIP & Miscellaneous       : Rs. 503.49 Lacs
     through approved agencies) :                          Expenditure)
                                                      b.   Revenue                                  : Rs.     58.93 Lacs
                                                      c.   Total                                    : Rs. 562.42 Lacs
                                                      d.   Total Expenses as a % of Turnover        :            0.36




                                                                             31
                                                                                                              BALLARPUR INDUSTRIES LIMITED

Technology Absorption, Adaptation & Innovation:

1.   Efforts made in brief towards                           —    In-house R&D Technology has been successfully
     Technology absorption:                                        absorbed for the improvement of products and development
                                                                   of new value added products for paper and coated paper.
2.   Benefits derived as a Result of                         —    Further improvement in superior quality of papers.
     the above :
3.   In case of Imported Technology (imported
     during the last 5 years reckoned from the
     beginning of the financial year)

     a.   Technology Imported :                              —                            —
     b.   Year of Import :                                   —                            —
     c.   Has Technology been fully absorbed :               —                            —
     d.   If not fully absorbed areas where
          this has not taken place, reasons
          therefor and future plan of action :               —-                           —


C. Foreign Exchange Earnings and Outgo

     a.   Activities relating to exports, initiatives        — The Company is redefining its distribution setup in the gulf/Middle
          taken to increase:                                   East and African countries. It has also done new product developments
                                                               for the above markets.
     b.   Total Foreign Exchange used
          and earned :                                  a.        Foreign Exchange used                          Rs. 113.88 Crores.
                                                        b.        Foreign Exchange earned                          Rs. 43.55 Crores.




                                                                                  32
BALLARPUR INDUSTRIES LIMITED


Auditors’ Report
To the Members                                                                             (f)    On the basis of written representations received from the Directors
of Ballarpur Industries Limited.                                                                  of the Company as at 30th June, 2001 and taken on record by
                                                                                                  the Board of Directors, we report that no Director is disqualified
We have audited the attached Balance Sheet of Ballarpur Industries Limited,                       from being appointed as a director of the Company under clause
as at 30th June 2001 and the annexed Profit and Loss Account of the Company                       (g) of sub section (1) of section 274 of the Companies Act, 1956.
for the year ended on that date, in which are incorporated the audited
                                                                                           (g)    Attention is drawn to the following notes in Schedule 'M'.
accounts of Units of the Company, audited by other auditors. In accordance
with the provisions of section 227 of the Companies Act, 1956, we report as                       (i)    Note 11 regarding non-availability of books of accounts/

under:-                                                                                                  records relating to Unit: Bengal Ingot, under work suspension,
                                                                                                         on which the Branch Auditors have expressed their inability
1.   As required by the Manufacturing and other Companies (Auditors' Report)
                                                                                                         to form an opinion regarding the correctness of the Accounts.
     Order, 1988 issued by the Central Government in terms of Section
     227(4A) of the Companies Act, 1956 and on the basis of such checks as                        (ii)   Note 15 regarding non provision of customs duty and

     we considered appropriate and according to information and explanations                             incidental expenses on Plant & Machinery lying under the

     given to us, and subject to related impact on the above order, of the                               custody of Port Authorities / Bonded Warehouse, as the

     non-availability of books of accounts / record as indicated in paragraph                            amount is not ascertainable.

     2(g)(i) below, we enclose in the Annexure a statement on the matter              3.   In our opinion and to the best of our information and according to the
     specified in paragraphs 4 & 5 of the said Order.                                      explanations given to us, the said Accounts read with the Notes thereon

2.   Further to our comments in the Annexure referred to in Paragraph 1                    and subject to our observations in paragraph 2 above, with corresponding

     above:                                                                                effect on the year's Profit, the ultimate effect of which is not currently
                                                                                           ascertainable, give the information required by the Companies Act,
     (a)      We have obtained all the information and explanations, which to
                                                                                           1956 in the manner so required and give a true and fair view:
              the best of our knowledge and belief were necessary for the
              purpose of our audit.                                                        (i)    In the case of the Balance Sheet of the state of affairs of the
                                                                                                  Company as at 30th June 2001.
     (b)      In our opinion, proper books of account, as required by law have
              been kept by the Company so far as appears from our examination              (ii)   In the case of Profit & Loss Account of the Profit of the Company

              of the books.                                                                       for the year ended on that date.

     (c)      The reports on the accounts audited by the respective Branch
              Auditors have been properly dealt with by us while preparing our
              report.                                                                                                           for K. K. MANKESHWAR & CO.

     (d)      The said Balance Sheet and Profit and Loss Account dealt with by                                                                 Chartered Accountants

              the report are in agreement with the books of account.

     (e)      In our opinion, the said Profit and Loss Account and Balance
              Sheet comply with the mandatory accounting standards referred
              to in Section 211(3C) of the Companies Act, 1956 to the extent          Camp : Gurgaon                                    ASHWIN MANKESHWAR

              applicable.                                                             Dated : 27th July, 2001                                                   Partner




                                                                                 33
                                                                                                             BALLARPUR INDUSTRIES LIMITED


ANNEXURE
(Referred to in paragraph 1 of our report of even date)                                  (ix)     Loans and Advances to subsidiaries and certain parties have no
                                                                                                  stipulation for repayment of principal. Interest wherever due
In terms of the information and explanations given to us and books and
records examined by us and the Branch Auditors in normal course of audit and                      thereon is being regularly received except in the case of loan to

to the best of our information and belief and subject to our observation in                       a company, where interest receivable up to 30th June 2001 has

paragraph 2(g) above, we state that:                                                              not been recovered. Loans and advances in the nature of loans
                                                                                                  to some other parties are being recovered as stipulated other
A.    (i)      The Company has maintained proper records showing full                             than those considered doubtful. Long-term advances have been
               particulars including quantitative details and situation of fixed
                                                                                                  granted to employees, free of interest, and the amount towards
               assets. The management, during the year, in accordance with
                                                                                                  the principal is being recovered regularly.
               the perpetual physical verification programme, has physically
               verified these assets. There were no material discrepancies               (x)      In our opinion, and according to the information and explanations
               noticed on such verification.                                                      given to us, there are adequate internal control procedures
                                                                                                  commensurate with the size of the Company and the nature of
      (ii)     None of the fixed assets of the Company have been revalued.
                                                                                                  its business with regard to purchase of stores, raw materials
      (iii)    As explained to us, the stocks of finished goods, stores, spare                    including components, plant and machinery, equipment and
               parts and raw materials except for items held by third parties                     other assets and for sale of goods.
               and stocks lying at outside warehouses have been physically
                                                                                         (xi)     In our opinion and according to the information and explanations
               verified by the management, either at the end of the period or
                                                                                                  given us, the prices paid for purchase of any goods and materials
               during the period in accordance with the perpetual inventory
                                                                                                  aggregating during the year to Rs. 50,000/- or more in value
               programme.
                                                                                                  from any of the parties listed in the register maintained under
      (iv)     In our opinion, the procedures for physical verification of stocks                 Section 301 of the Companies Act, 1956 are reasonable having
               followed by the management are reasonable and adequate in                          regard to prevailing market prices for such goods and materials.
               relation to the size of the Company and nature of its business.                    In case of certain sales of goods or services aggregating during
                                                                                                  the year to Rs.50,000/- or more in value to the parties listed in
      (v)      The discrepancies noticed between the physical stocks of items
                                                                                                  the register maintained under Section 301 of the Companies
               verified and book stocks, which in our opinion were not material,
                                                                                                  Act, 1956 are at prices which are comparable to the prices at
               have been properly dealt with in the books of account.
                                                                                                  which transactions for similar goods or services have been made
      (vi)     In our opinion, the valuation of stocks of finished goods, stores,                 with other parties.
               spare parts and raw materials have been fair and proper in
                                                                                         (xii)    As explained to us, unserviceable or damaged stores and raw
               accordance with the normally accepted accounting principles
               and is on the same basis as in the preceding year                                  materials are determined by the Company in a systematic manner
                                                                                                  on the basis of technical evaluation, and on such basis, in our
      (vii)    The Company has not taken any loans, secured or unsecured,                         opinion, adequate amounts have been written off of such stocks
               from companies, firms or other parties listed in the register                      in the accounts.
               maintained under Section 301 of the Companies Act, 1956 or
               from the Companies under the same management as defined                   (xiii)   In our opinion and according to the information and explanations

               under Sub-Section (1B) of Section 370 of the Companies Act,                        given to us, the Company has complied with the provisions of

               1956.                                                                              Section 58-A of the Companies Act, 1956, and the Companies
                                                                                                  (Acceptance of Deposits) Rules, 1975 with regard to the deposits
      (viii)   The Company has not granted any loans, secured or unsecured,
                                                                                                  accepted from the Public.
               to companies, firms or other parties listed in the register
               maintained under Section 301 of the Companies Act, 1956 or                (xiv)    In our opinion, reasonable records have been maintained by the
               to the companies under the same management defined under                           Company for the sale and disposal of realised by-products and
               Sub-Section (1B) of Section 370 of the Companies Act, 1956.                        scrap where applicable and significant.




                                                                                    34
BALLARPUR INDUSTRIES LIMITED

   (xv)    In our opinion, the Company has an adequate internal audit                    (xix)   During the course of examination of the books of account carried
           system commensurate with the size and nature of its business                          out in accordance with the generally accepted auditing practices,
           except in the case of Unit BIC where there is no Internal Audit                       we have not come across any personal expenses other than
           system .                                                                              those payable under contractual obligation/agreement or paid
                                                                                                 in accordance with generally accepted business policies, which
   (xvi)   According to the records, produced and information given to
                                                                                                 have been charged to Profit & Loss Account, nor have we been
           us, the cost records and accounts as prescribed by the Central
                                                                                                 informed of any such case by the Management.
           Government under Section 209(1)(d) of the Companies Act,
           1956 in respect of certain products of the Company, namely                    (xx)    The Company is not a sick industrial company, within the
           Paper and Caustic Soda have been maintained but no examination                        meaning of Clause (O) of Section 3(I) of the Sick Industrial
           of such records and accounts has been carried out by us.                              Companies (Special Provisions) Act, 1985.

   (xvii) The Company has generally, regularly deposited during the year,          B.    Items 4B(ii), (iii) and (iv) of the aforesaid Order are not applicable.
           the Provident Fund and Employees' State Insurance dues
                                                                                   C.    In respect of the Company's trading activity the value of the damaged
           wherever applicable except in the case of Unit: Bengal Ingot
                                                                                         goods, which in our opinion, is not significant, has been regularly
           where the outstanding ESI dues as at the year end are Rs.89421.
                                                                                         determined and properly accounted for.
   (xviii) According to the information and explanations given to us, there
           was no amount outstanding as at 30th June, 2001, in respect of
                                                                                                                             for K K MANKESHWAR & CO.
           undisputed Income Tax, Wealth Tax, Sales Tax, Custom Duty
                                                                                                                                           Chartered Accountants
           and Excise Duty, which were due for more than six months
           from the date they became payable except where the liabilities
           are deferred by the Government and in case of Unit Shree
           Gopal, Turnover Tax amounting to Rs.68.27 Lakhs for which               Camp : Gurgaon                                  ASHWIN MANKESHWAR

           there are no apparent disputes.                                         Dated : 27th July, 2001                                                  Partner




                                                                              35
                                                                                                   BALLARPUR INDUSTRIES LIMITED


Balance Sheet
AS AT 30TH JUNE, 2001
                                                                                                   30th June,                             30th June,
                                                               SCHEDULE                                  2001                                   2000
                                                                                                   (Rs. ‘000)                              (Rs. ‘000)
I.    SOURCES OF FUNDS :
1.    Shareholders’ Funds
      (a) Capital                                                      ‘A’             1,307,047                      1,103,172
          Share Suspense                                                                  11,605                        130,480
      (b) Reserves and Surplus                                         ‘B’             7,663,310                      7,202,934

                                                                                                    8,981,962                             8,436,586
2.    Loan Funds
      (a) Secured Loans                                                ‘C’             8,861,583                      8,515,766
      (b) Unsecured Loans                                              ‘D’             2,784,246                      1,917,207

                                                                                                   11,645,829                            10,432,973
      TOTAL                                                                                        20,627,791                            18,869,559

II.   APPLICATION OF FUNDS :
1.    Fixed Assets
      (a) Gross Block (Adjusted)                                       ‘E’           17,462,118                     17,276,399
          Less: Depreciation                                                          5,658,570                      4,830,754

          Net Block                                                                  11,803,548                     12,445,645
      (b) Construction and Installation in Progress
          including Expenditure thereon (Pending allocation)                           3,838,108                      2,772,904
      (c) Advance against Machinery, Land etc.                                         1,138,059                        997,292

                                                                                                   16,779,715                            16,215,841
2.    Investments                                                      ‘F’                          1,312,032                             1,342,631

3.    Current Assets, Loans and Advances
      (a) Income accrued on Investments
          and Fixed Deposits (Net)                                                        77,038                        497,150
      (b) Inventories                                                  ‘G’             1,664,908                      1,321,455
      (c) Sundry Debtors                                               ‘H’             1,428,999                      1,166,352
      (d) Cash and Bank Balances                                        ‘I’              603,142                        366,868
      (e) Loans and Advances                                            ‘J’            1,962,920                      1,333,745
                                                                                       5,737,007                      4,685,570
Less: Current Liabilities and Provisions :                             ‘K’
      (a) Liabilities                                                                  3,067,873                      3,170,613
      (b) Provisions                                                                     347,656                        332,853
                                                                                       3,415,529                      3,503,466

Net Current Assets                                                                                  2,321,478                             1,182,104
Miscellaneous Expenditure                                              ‘L’
(To the extent not written off or adjusted)                                                          214,566                               128,983
Notes to Balance Sheet                                              ‘M’
      TOTAL                                                                                        20,627,791                            18,869,559

Note: Schedules 'A' to 'M' referred to above form an integral part of the Balance Sheet.

As per our report annexed
For K. K. MANKESHWAR & CO.,                                                                         L M THAPAR            –   Chairman
Chartered Accountants
                                                                                                    GAUTAM THAPAR –           Vice Chairman &
ASHWIN MANKESHWAR                            R K CHOPRA                       NEERJA SHARMA                                   Managing Director
Partner                                      Vice President &                  Company Secretary    R R VEDERAH           –   Director
                                        Group Chief Accounts Officer
                                                                                                    B HARIHARAN           –   Director
Camp : Gurgaon                                                                                      Gurgaon
Dated : 27th July, 2001                                                                             Dated : 27th July, 2001



                                                                              36
BALLARPUR INDUSTRIES LIMITED


Profit & Loss Account
FOR THE YEAR ENDED 30TH JUNE, 2001

                                                                                    Current                  Previous
                                                        SCHEDULE                         Year                     Year
                                                                                   (Rs. ‘000)               (Rs. ‘000)

INCOME
   Sales and Other Revenues                                ‘I’                    15,676,124              14,463,862
   Other Income                                            ‘II’                     127,086                  62,659
   Increase/(Decrease) in Stocks                          ‘III’                     124,080                  93,440


   TOTAL                                                                          15,927,290              14,619,961

EXPENDITURE
   Manufacturing Costs                                    ‘IV’                     9,138,572               8,473,370
   Purchases                                                                        483,398                1,013,129
   Personnel Costs                                         ‘V’                     1,230,495               1,000,822
   Administration, Selling and Miscellaneous Costs        ‘VI’                      735,094                 611,063
   Interest and Finance Costs (Net)                       ‘VII’                    1,241,748               1,128,130
   Excise Duty (Net)                                                               1,221,465               1,070,693
   Deferred Revenue Expenditure - Amortised (Net)                                    37,166                  60,752
   Depreciation                                                         839,395                 833,450
   Less : Transferred from Revaluation Reserve being
          the difference of Depreciation on Revalued
          Cost and on Original Cost in respect of
          Revalued Assets (Net)                                          88,376                 264,345

                                                                                    751,019                 569,105

   TOTAL                                                                          14,838,957              13,927,064

   Profit Before Taxation                                                          1,088,333                692,897
   Exceptional losses :
   Loss due to Supercyclone at Unit-Choudwar (Orissa)                                      –                 12,485
   Provision For Taxation/MAT                                                        85,500                         –
   Profit after Taxation                                                           1,002,833                680,412
   Add: Balance brought forward from last year                                      237,812                  64,839

   Add :Capital Profit on Sale of Assets                                  5,263                   2,872
   Debenture Redemption Reserve no longer required                      334,300                 234,545

                                                                                    339,563                 237,417

                                                                                   1,580,208                982,668

   Less : Adjustments relating to earlier years (Net)                                43,584                  87,083

   Amount Available For Appropriation                                              1,536,624                895,585




                                                                   37
                                                                                               BALLARPUR INDUSTRIES LIMITED

                                                                                                Current                               Previous
                                                             SCHEDULE                                Year                                  Year
                                                                                               (Rs. ‘000)                            (Rs. ‘000)


APPROPRIATIONS
Capital Reserve                                                                                    5,263                                2,872
Debenture Redemption Reserve                                                                     233,300                              277,300
General Reserve                                                                                  500,000                              100,000
Proposed Dividend:
    Non Convertible Cumulative Preference Shares @ 12% - 14.25%                     22,309                            5,256
    On 11% Redeemable Cumulative Preference Shares                                  43,598                           43,599
    On 71538969 Ordinary Shares @ 30%                                              214,617                          178,848
    (1999-00 on 71538969 Ordinary Shares @ 25%)
                                                                                   280,524                          227,703

    Add : Dividend Tax                                                              30,641       311,165             49,898           277,601


    Balance Carried to Balance Sheet                                                             486,896                              237,812

NOTES FORMING PART OF PROFIT & LOSS ACCOUNT                      ‘VIII’

                                                                                               1,536,624                              895,585



As per our report annexed
For K. K. MANKESHWAR & CO.,                                                                     L M THAPAR            –   Chairman
Chartered Accountants
                                                                                                GAUTAM THAPAR –           Vice Chairman &
ASHWIN MANKESHWAR                           R K CHOPRA                    NEERJA SHARMA                                   Managing Director
Partner                                     Vice President &               Company Secretary    R R VEDERAH           –   Director
                                       Group Chief Accounts Officer
                                                                                                B HARIHARAN           –   Director
Camp : Gurgaon                                                                                  Gurgaon
Dated : 27th July, 2001                                                                         Dated : 27th July, 2001




                                                                          38
BALLARPUR INDUSTRIES LIMITED


Schedules “A” To “M”
ATTACHED TO AND FORMING PART OF THE BALANCE SHEET AS AT 30TH JUNE, 2001

                                                                                                                                             As at 30th June
                                                                                                                                                        2000
                                                                                                          (Rs. ‘000)                               (Rs. ‘000)

SCHEDULE “A” : SHARE CAPITAL
AUTHORISED :
     97500000 (Previous Year 97500000)
     Ordinary Shares of Rs.10/- each                                                                        975,000                                975,000
     10250000 (Previous Year 10250000)
     Preference Shares of Rs.100/- each                                                                   1,025,000                              1,025,000

                                                                                                          2,000,000                              2,000,000

ISSUED :
     71588918 (Previous Year 59701449) Ordinary
     Shares of Rs.10/- each                                                                                 715,889                                597,014
     3963500 (Previous Year 3963500) 11% Redeemable Non-
     Convertible Cumulative Preference Shares of Rs.100/- each.                                             396,350                                396,350
     1400000 (Previous Year 550000) 12% Redeemable Non-
     Convertible Cumulative Preference Shares of Rs.100/- each.                                             140,000                                  55,000
     27500 (Previous Year 27500) 12.50% Redeemable Non-
     Convertible Cumulative Preference Shares of Rs.100/- each.                                               2,750                                   2,750
     23700 (Previous Year 23700) 13% Redeemable Non-
     Convertible Cumulative Preference Shares of Rs.100/- each.                                               2,370                                   2,370
     500000 (Previous Year 500000) 14.25% Redeemable Non-
     Convertible Cumulative Preference Shares of Rs.100/- each.                                              50,000                                  50,000

                                                                                                          1,307,359                              1,103,484

SUBSCRIBED :
     71588918 (Previous Year 59701449) Ordinary
     Shares of Rs.10/- each                                                                                 715,889                                597,014
     Less: 49949 Ordinary Shares (Previous Year
           49949) of Rs.10/- each forfeited                                                                      499                                    499

                                                                                                            715,390                                596,515
     Add: Forfeited Shares (Amount paid up)                                                                      187                                    187

                                                                                                            715,577                                596,702
     3963500 (Previous Year 3963500) 11% Redeemable Non-
     Convertible Cumulative Preference Shares of Rs.100/- each.                                             396,350                                396,350
     1400000 (Previous Year 550000) 12% Redeemable Non-
     Convertible Cumulative Preference Shares of Rs.100/- each.                                             140,000                                  55,000
     27500 (Previous Year 27500) 12.50% Redeemable Non-
     Convertible Cumulative Preference Shares of Rs.100/- each.                                               2,750                                   2,750
     23700 (Previous Year 23700) 13% Redeemable Non-
     Convertible Cumulative Preference Shares of Rs.100/- each.                                               2,370                                   2,370
     500000 (Previous Year 500000) 14.25% Redeemable Non-
     Convertible Cumulative Preference Shares of Rs.100/- each.                                              50,000                                  50,000

                                                                                                          1,307,047                              1,103,172
Of the above:
a)   35,000 (Previous Year 35,000) Ordinary Shares allotted as fully paid up without payment being received in cash.
b)   1,54,23,900-1/2 (Previous Year 1,54,23,900-1/2) Ordinary Shares of Rs. 10/- each allotted as fully paid up by way of Bonus Shares capitalised from
     General Reserve and Share Premium Account.
c)   9,50,000 (Previous Year 9,50,000) Ordinary Shares of Rs.10/- each fully paid up issued to Financial Institutions on part conversion of Loans/Debentures.
d)   43,74,945 (Previous Year 43,74,945) Ordinary Shares of Rs.10 each allotted as fully paid up to the Shareholders of the Amalgamating Companies
     pursuant to the Schemes of Amalgamation.



                                                                            39
                                                                                                        BALLARPUR INDUSTRIES LIMITED

e)   1,35,174 (Previous Year 1,35,174) Ordinary Shares of Rs.10/- each allotted as fully paid up in conversion of 237 - 4% Euro Bonds of the Face Value
     of US$ 11,85,000.
f)   1,18,87,469 Ordinary Shares of Rs.10/- each allotted during the year as fully paid up , in terms of Scheme of Arrangement and Reorganisation.
g)   39,63,500 - 11% Redeemable Non-Convertible Cumulative Preference Shares of Rs.100/- each are redeemable on 1st April, 2008.
h)   3,00,000 - 12% Redeemable Non-Convertible Cumulative Preference Shares of Rs.100/- each have been redeemed during the year.
I)   2,50,000 - 12% Redeemable Non-Convertible Cumulative Preference Shares of Rs.100/- each are redeemable on 3rd January, 2003 with a put and call
     option at the end of every twelve months from the date of allotment.
j)   5,00,000 - 12 % Redeemable Non-Convertible Cumulative Preference Shares of Rs.100/- each ,issued during the year on private placement basis, are
     redeemable on 20th August, 2001.
k)   5,00,000 - 12 % Redeemable Non-Convertible Cumulative Preference Shares of Rs.100/- each ,issued during the year on private placement basis, are
     redeemable on 12th January, 2006.
l)   1,50,000 - 12 % Redeemable Non-Convertible Cumulative Preference Shares of Rs.100/- each ,issued during the year on private placement basis, are
     redeemable on 25th October, 2003 with a put and call option every twelve months from the date of allotment.
m) 27,500 - 12.50% Redeemable Non-Convertible Cumulative Preference Shares of Rs.100/- each, are redeemable on 6th June, 2002 with a put and call
   option at the end of twelve months from the date of allotment.
n)   23,700 - 13% Redeemable Non-Convertible Cumulative Preference Shares of Rs.100/- each are redeemable on 6th June, 2003.
o)   5,00,000 - 14.25% Redeemable Non-Convertible Cumulative Preference Shares of Rs.100/- each are redeemable on 25th February, 2003 with a put
     option at the end of every twelve months from the date of allotment.
                                                                                                                                          As at 30th June,
                                                                                                                                                     2000
                                                                                                         (Rs. ‘000)                             (Rs. ‘000)

SCHEDULE “B” : RESERVES & SURPLUS
CAPITAL RESERVE :
   As per Last Account                                                                                    114,107                                    113,735
   Less: Transfer under scheme of Arrangement & Reorganisation                                                  –                                      2,500

                                                                                                          114,107                                    111,235
     Add: Reserves vested in terms of approved Scheme of
           Arrangement and Reorganisation                                                          –                        1,595,321
     Less: Appropriation as on 1.7.1999 towards Debenture
           Redemption Reserve on Debentures vested in the Company                                  –                          208,800
     Less: Appropriation & Adjustment of expenses incurred
           towards the schemes of Restructuring, Arrangement &
           Reorganisation                                                                          –                          594,904

                                                                                                   –                          791,617
     Less: Transfer of balance to General Reserve, as provided
           in the approved Scheme of Arrangement & Reorganisation                                  –                          791,617
                                                                                                                 –                                         –
     Add: Transferred from Profit & Loss Account                                                             5,263                                     2,872

                                                                                                           119,370                                   114,107

SHARE PREMIUM ACCOUNT :
   As per Last Account                                                                                   3,941,723                             3,951,362
   Less: Share/Deb. Issue Expenses adjusted and written off                                                103,256                                 5,963
   Less: Premium on redemption of Debentures                                                                     –                                 3,676

                                                                                                         3,838,467                             3,941,723

PREFERENCE SHARE CAPITAL REDEMPTION RESERVE :
   As per Last Account                                                                                     179,749                               179,749

                                                                                                           179,749                               179,749

REVALUATION RESERVE :
   As per Last Account                                                                                      89,715                               346,733
   Less : Transferred to Profit & Loss Account being the difference of depreciation
          for the year on revalued amount of Assets and on their original cost
          and Revaluation portion of Assets sold/written off and adjusted (Net).                            89,715                               257,018

                                                                                                                  –                                  89,715



                                                                            40
BALLARPUR INDUSTRIES LIMITED

                                                                                                                                                As at 30th June,
                                                                                                                                                            2000
                                                                                                             (Rs. ‘000)                                (Rs. ‘000)
GENERAL RESERVE :
   As per Last Account                                                                                       1,703,529                                  811,912
   Add : Transferred from Profit & Loss Account                                                                500,000                                  100,000
   Add: Transfer of net balance out of Reserves vested in
         terms of approved Scheme of Arrangement and Reorganisation                                                    –                                791,617
                                                                                                             2,203,529                                1,703,529
INVESTMENT ALLOWANCE RESERVE :
   As per Last Account                                                                                           61,999                                  61,999
                                                                                                                 61,999                                  61,999
DEBENTURE REDEMPTION RESERVE :
   As per Last Account                                                                                         874,300                                  622,745
   Less : Transferred to Profit and Loss Account                                                               334,300                                  234,545
                                                                                                               540,000                                  388,200
     Add : Appropriation out of Reserves vested
           as per Scheme of Arrangement and Reorganisation                                                           –                                  208,800
     Add: Transferred from Profit & Loss Account                                                               233,300                                  277,300
                                                                                                               773,300                                  874,300

BALANCE AS PER PROFIT AND LOSS ACCOUNT                                                                         486,896                                  237,812
                                                                                                             7,663,310                                7,202,934

                                                                                                   As at 30th June,                              As at 30th June,
                                                                                                                2001                                         2000
                                                                                             Notes        (Rs. ‘000)                                    (Rs. ‘000)
SCHEDULE “C” : SECURED LOANS
Debentures                                                                                        (1)        2,750,952                                1,993,431
Term Loans from Financial Institutions                                                            (2)        3,136,450                                3,271,834
(including Foreign Currency Loans)
Term Loans from Banks                                                                             (3)                  –                                123,630
(including Foreign Currency Loans)
External Commercial Borrowing                                                                     (4)        1,512,320                                1,436,800
Working Capital Facilities from Banks                                                             (5)        1,461,861                                1,690,071

                                                                                                             8,861,583                                8,515,766
Notes :
1.   These comprise of :-
     a. 19.5% Non-Convertible Debentures of Rs.100/- each Privately Placed with Financial Institutions, amounting to Rs.3333 Lacs (30.6.2000 Rs.5000
        Lacs) Secured by pari-passu first charge created/to be created on all immovable and movable properties (save and except book debts) on all the Units
        of Company (except certain machinery of the Company's Units at Ballarpur, Yamunanagar hypothecated to a Financial Institution )both present and
        future subject to prior charges created/to be created in favour of the Company's Bankers to secure borrowings for Working Capital and excluding
        specific items of Plant and Machinery charged/to be charged in favour of any lenders or suppliers providing finance for the acquisition thereof and
        further secured by pari-passu charge created on land situated in Singach in the state of Gujarat. Redeemable in three equal annual installments
        commencing from 14th August, 2000.
     b. 18.5% Non-Convertible Debentures of Rs.100/- each amounting to Rs.767 Lacs (30.6.2000 Rs.1150 Lacs) -Secured by a First mortgage and charge
        on the company's Unit AP Rayon's land situated in the state of Gujarat and hypothecation of all movable assets save and except book debts of the
        Company. Redeemable at par in three installments of Rs.33.33,Rs.33.34 and Rs.33.33 per debenture on March 21,2001, March 21,2002 and March
        21,2003 respectively.
     c. 11.70% Non-Convertible Debentures of Rs.1500000/- each privately placed with institutions aggregating to Rs.15000 lacs Redeemable in 15 equal
        semi - annual installments commencing from 7th February, 2004. Secured by a first charge on all or substantially all immovable assets of the company
        other than current assets (which shall include the book debt), a first charge by way of assignment of all agreements, concessions, permits etc. associated
        with a project and second charge on all the current assets of the Company, including book debts ranking pari-passu with the claims of the existing
        lenders.Also ranking pari-passu with the security created by the company in favour of IFC, Washington for the payment guaranteed by them.
     d. 13.50% Non-Convertible Debentures of Rs.100/- each privately placed -amounting to Rs.3000 Lacs (30.6.2000 Rs. Nil) -To be secured by
        equitable mortgage by deposit of Title Deeds of all the immovable properties of the company and by a first charge by way of hypothecation of
        all the movable properties, present or future (save and except book debts) subject to prior charges created in favour of company's bankers for
        securing borrowings for Working Capital. Redeemable in three equal yearly installments starting from the end of 4th year of allotment.
     e. 14% Redeemable Non Convertible Debentures of Rs.100/- each amounting to Rs.2120 Lacs (30.6.2000 Rs.5477 Lacs) - Secured by a first charge and
        charge on company's Unit-AP Rayon's land in Gujarat and hypothecation of all movable assets (save and except book debts). Redeemable at par in 3
        annual installments on 15th May, 2000, 2001 and 2002 @ Rs.40/- Rs.30/-and Rs.30/- respectively.



                                                                               41
                                                                                                                                       BALLARPUR INDUSTRIES LIMITED

      f. 15.5% Non Convertible Bonds of Rs.100000/- each Privately Placed with Institutions/Banks -amounting to Rs.3289 Lacs (30.6.2000 Rs.5060 Lacs)
          Secured by Pari-Passu charge created / to be created on all free hold and lease hold immovable properties at Singach in
          District Jamnagar, Gujarat State. (Redeemable in three annual installments commencing from 1st September, 2000).
2.    These comprise of :-
      a. Term loans from Financial Institutions amounting to Rs.27799 Lacs (30.6.2000 Rs.28548 Lacs) - Secured by First Charge created / to be created in its
          favour with additional security by way of mortgage through constructive delivery of Title Deeds of immovable properties of Units Shree Gopal,
          Ballarpur, Sewa, Choudwar, AP Rayons and erstwhile Units of Ashti, AAC, Palwal.
      b. Foreign Currency Loans from Financial Institutions amounting to Rs.3566 Lacs (30.6.2000 3956 Lacs) - Secured by Pari-Passu charge by way of
          equitable mortgage of all immovable properties and hypothecation of movable properties of certain units excluding certain borrowings from banks for
          Working Capital requirement.
3.    This represents :-
      Foreign Currency Loans from Banks amounting to Rs.Nil (30.6.2000 Rs.1236 Lacs ) - Secured by Pari -Passu charge by way of equitable mortgage of all
      immovable properties and hypothecation of movable properties of certain units excluding certain borrowings from banks for Working Capital requirement.
4.    These are secured by a pari-passu charge on immovable properties of certain Units of the Company.
5.    These are secured by hypothecation of stocks of Raw Materials, Goods -in-Process, Finished Products, General Stores and Spares, Book Debts, Goods-
      in-Transit and Movable Property against cash credit accounts and for Packing credit facilities by hypothecation of goods meant for exports (including Term
      Loans carved out by consortium of banks with first pari passu charge on fixed assets pending documentation)
                                                                                                       As at 30th June,                        As at 30th June,
                                                                                                                    2001                                    2000
                                                                                                              (Rs. ‘000)                               (Rs. ‘000)

SCHEDULE “D” : UNSECURED LOANS
Fixed Deposits                                                                                                                          1,736,540                                        1,010,190
External Commercial Borrowing                                                                                                                     0                                       323,280
Loan from Banks                                                                                                                           797,706                                         310,739
Loan from Others                                                                                                                          250,000                                         272,998

                                                                                                                                        2,784,246                                        1,917,207

SCHEDULE ‘E’ : FIXED ASSETS                                                                                                                                                               Rs. in '000

ASSETS                                                        GROSS BLOCK                                                  DEPRECIATION                                      NET BLOCK
                                     As at 1st              Net    Additions Sales/Adj-     Total as   As at 1st      Adjustment      For the    On Sales,    As at 30th As at 30th       As at 30th
                                          July,        Additions      during ustments &     at 30th         July,           as per       Year Adjustments           June,      June,            June,
                                        2000              as per         the Disposals         June,      2000         Scheme of              & Disposals           2001       2001            2000
                                                      Scheme of         Year during the        2001                  Arrangement                during the
                                                  Arrangement &                    Year                                       and                     Year
                                                  Reorganisation                                                    Reorganisation
                                     (Rs.’000)         (Rs.’000)   (Rs.’000)   (Rs.’000)   (Rs.’000) (Rs.’000)           (Rs.’000) (Rs.’000)     (Rs.’000)     (Rs.’000)     (Rs.’000)     (Rs.’000)
Land (including leasehold lands)     558,154                  0       5,050      9,360      553,844            0                0          0             0            0       553,844      558,154
Buildings                           2,670,216                 0      63,454     26,660     2,707,010   356,754                  0     63,593            73      420,274     2,286,736     2,313,462
Railway Sidings, Trolley Lines,
Tramway and Tipping Tubs                1,606                 0           0           0       1,606      1,567                  0          5             0        1,572            34             39
Plant, Machinery and
Equipments                         13,903,445                 0    198,318      48,478 14,053,285 4,392,944                     0    761,688          8,074   5,146,558     8,906,727     9,510,501
Furniture, Fixtures and Office
Equipments                           105,526                  0     10,031       4,969      110,588     56,810                  0     11,421          1,529      66,702        43,886        48,716
Vehicles                              29,632                  0        845       2,441       28,036     18,993                  0      2,676          1,777      19,892         8,144        10,639
Gas Cylinders                          3,718                  0           0        127        3,591      3,686                  0         12           126        3,572            19             32
TOTAL : This Year                  17,272,297                 0    277,698      92,035 17,457,960 4,830,754                     0    839,395       11,579     5,658,570 11,799,390 12,441,543

TOTAL : Previous Year              13,833,824        3,270,205     303,047     134,779 17,272,297 4,487,480              445,813     833,450       44,363     4,830,754

Scrap Assets                                                                                                                                                                    4,158         4,102

                                                                                                                                                                           11,803,548 12,445,645

NOTES:
1.    Buildings include Rs.209620850 (Previous year 226677500) towards revalued value of ownership flats in Cooperative Housing Societies.
2.    Additions during the year includes Rs. 348916 for Research & Development.
3.    The above Schedule includes the Company's share of the fixed assets of Khanna Factory owned by the Company and JCT Ltd.
4.    The Lease Agreement in respect of 5.47 Acres of Land of Unit Sewa in possession of the Company are yet to be executed in favour of the Company. Lease Deeds held
      in the name of erstwhile amalgamating Company Sewa Paper Limited are being mutated in favour of the Company.
5.    Lease deed of land at Unit: Bengal Ingot is awaiting renewal.
6.    Land includes Rs.9313 being the value of Leasehold Land continuing to be in the names of the employees of the erstwhile Sewa Papers Limited.
7.    Scrap Assets include Rs. Nil (Previous year Rs.16000) vested as per Scheme of Arrangement and Reorganisation.
8.    Notwithstanding vesting of certain assets in the Company and the assets vesting out (in terms of approved Scheme of Arrangement & Reorganisation) and sale of Unit
      AAC, Palwal, the assets/charges continue to be in the name of the transferor company/company's lenders. Actions are being initiated for formal transfer of Title Deeds/
      Ownership Rights in the name of the Company/Transferee Company.



                                                                                                 42
BALLARPUR INDUSTRIES LIMITED


SCHEDULE “F” : INVESTMENTS
                                                                                                AS AT 30TH JUNE, 2001               AS AT 30TH June, 2000
PARTICULARS                                                                                    Face Value Cost/Revalued            Face Value Cost/Revalued
                                                                                                  or Nos.       Rs. '000             or Nos.        Rs. '000
GOVERNMENT/ OTHER SECURITIES :
12-Year National Plan Savings Certificates                                                                –                –         Rs.1000                1
(Lodged as Security Deposit - Matured)
(written off during the year )
12-Year National Defence Certificates                                                                     –                –         Rs.1000                1
(Lodged as Security Deposit - Matured)
(written off during the year)
7 -Year National Savings Certificates                                                            Rs.3,000                  3         Rs.7000                7
(Lodged as Security Deposit Rs. 3,000)
(written off during the year Rs. 4,000)
6 -Year National Savings Certificates                                                          Rs.380,400               381       Rs.382900               383
(Lodged as Security Deposit)
(Redeemed during the year Rs.7500 & purchased
during the year Rs.5000)
5 -Year Kisan Vikas Patra                                                                        Rs.3,000                  3         Rs.3000                3
(Lodged as Security Deposit)
5 -Year 240 Nos. Indira Vikas Patra                                                            Rs.650,000               650       Rs.650300               650
(Lodged as Security Deposit)
(Redeemed during the year Rs.300)
11.55% 150 Nos. State Bank of India                                                       Rs.150,000,000           155,409                  –               –
Bonds ,2006 Fully paid Bonds of Rs.10,00,000/- each
(Purchased during the year .- See Note)

OTHER INVESTMENTS :
Subsidiary Companies :
(Considered to be of Strategic Importance):
Bilt Tree Tech Limited                     Fully paid Equity Shares of Rs.10/- each.              990,000             3,960          990,000            3,960
Janpath Investments & Holdings Ltd.       Fully paid 5% Redeemable Cumulative
                                          Preference Shares of Rs.10/- each.                   40,000,000          400,000       40,000,000          400,000
Janpath Investments & Holdings Ltd.        Fully paid Equity Shares of Rs.10/- each.           38,989,200          389,892       38,989,200          389,892
Janpath Investments & Holdings Ltd.        Fully paid Redeemable Bonds of Rs.100000/- each.               –                –          10,800       1,080,000
                                           (Fully Redeemed during the year)
The Paper Base Company Ltd.               Fully paid Equity Shares of Rs.10/- each           999,930                 13,999          999,930          13,999
The Paper Base Company Ltd.               Fully paid 25% Redeemable Cumulative
                                          Non Convertible Preference Shares of Rs.100/- each 300,000                 47,400          300,000          47,400
Other Companies:
(Considered to be of Strategic Importance)
Blue Horizon Investments Ltd.            Fully paid Equity Shares of Rs.10/- each.                   5,000              335            5,000              335
                                                                                                                 1,012,032                         1,936,631
   Less : Amount of advance received towards
   redemption of Optionally Convertible Bonds,
   of Janpath Investments & Holdings Ltd.                                                                                  –                         594,000
                                                                                                                 1,012,032                         1,342,631
   Debenture Application Money pending allotment                                                                   300,000                                  –
                                                                                                                 1,312,032                         1,342,631

   In Government Securities & Bonds                                                                                156,446                             1,045
   In Fully paid Preference Shares                                                                                 447,400                           447,400
   In Fully paid Equity Shares                                                                                     408,186                           408,186
   In Fully paid Bonds                                                                                                                             1,080,000
   Less: Amount of advance received (as above)                                                                           –                          (594,000)
   Debenture Application Money pending allotment                                                                   300,000                                  –
                                                                                                                 1,312,032                         1,342,631
                                                                                                                Book Value                       Book Value
                                                                                                                   Rs. '000                         Rs. '000
Breakup:
Unquoted Investments                                                                                               8,555,86                        1,341,586
Debenture Application Money pending allotment                                                                      300,000                                 –
Others :
Government Securities & Bonds                                                                                      156,446                              1,045
                                                                                                                 1,312,032                         1,342,631

Note : 11.55% State Bank of India Bonds are under lien with trustees of 11.70% Non-Convertible Debenture holders, pending transfer in the name of the Company.


                                                                              43
                                                                     BALLARPUR INDUSTRIES LIMITED

                                                                                       As at 30th June,
                                                                                                  2000
                                                                     (Rs. ‘000)              (Rs. ‘000)

SCHEDULE “G” : INVENTORIES
(As valued and certified by the Management)

Raw Materials -At Cost                                                688,218                 475,561
Stock of Stores, Spare Parts, Chemicals etc. -At Cost                 432,575                 433,640
Block Stores - At Cost                                                 26,957                  27,159
Raw Materials and Stores-in-Transit -At Cost                           13,738                   5,755

Stock in Trade:
     Finished Stock
     –     At Cost or net realisable value whichever is lower         430,704                 318,367

     Stock-in-Process
     –    At Cost or net realisable value whichever is lower           72,716                  60,973


                                                                     1,664,908              1,321,455



SCHEDULE “H” : SUNDRY DEBTORS

Debts outstanding for a period exceeding six months :
Secured -
    Considered Good                                                         99                    305
Unsecured -
    Considered Good
        Due from Subsidiaries                                              53                  49,386
        Due from Others                                               345,900                 157,515
     Considered Doubtful                                               14,884                  13,505

                                                                      360,936                 220,711

Other Debts :
    Secured-
         Considered Good                                               11,104                   3,603
    Unsecured -
         Considered Good-
         Due from Others                                             1,351,207              1,156,323

                                                                     1,362,311              1,159,926
          Less: Bills Discounted                                       294,248                214,285

                                                                     1,068,063                945,641

                                                                     1,428,999              1,166,352




                                                                44
BALLARPUR INDUSTRIES LIMITED

                                                                                                                 As at 30th June
                                                                                                                            2000
                                                                                          (Rs. ‘000)                   (Rs. ‘000)



SCHEDULE “I” : CASH AND BANK BALANCES

Cash on Hand                                                                                  3,335                       5,769
Remittances-in-Transit                                                                        2,000                         348
Cheques and Drafts on Hand                                                                        3                       1,270

Bank Balances:
With Scheduled Banks :
    On Current Accounts                                                         162,340                 83,171
    (under lien account Rs.35100100/-)
     On Savings Accounts                                                            37                     38
     On Margin Money Account                                                      9,915                 40,641

On Employees’ Security Deposit Account
    In Savings Bank Account                                                        222                    218

On Fixed Deposit Accounts
    (Deposit Receipts for Rs.79206399/- under lien / lodged as Security)        282,039                108,716

On Unpaid Dividend Account                                                        7,926                  5,104
                                                                                           462,479                     237,888
With Post Office on Saving Bank Accounts
    (Pass Books for Rs.246200/- lodged as Security Deposit)                                     247                         275

With Non Scheduled Bank on Fixed Deposit Account
    ING Bank - Singapore                                                                   135,078                     121,318
    (Maximum balance outstanding at any time during the year Rs.135078391/-)
                                                                                           603,142                     366,868




                                                                           45
                                                                                                  BALLARPUR INDUSTRIES LIMITED

                                                                                                                                   As at 30th June
                                                                                                                                              2000
                                                                                                   (Rs. ‘000)                            (Rs. ‘000)

SCHEDULE “J” : LOANS AND ADVANCES

Advances, Deposits and Prepaid Expenses
recoverable in cash or in kind or for
value to be received :
Advances against Purchase of Stores etc.
Unsecured -
Considered Good :
     Due from Others                                                                                 186,169                              175,401
     Due from Subsidiary Company                                                                            –                                  13
     Due from Bilt Paper Holdings Ltd.                                                                      –                             148,057
     (a company under the same management)
     {Maximum balance outstanding at any time
     during the year Rs. 148057571}
Considered Doubtful                                                                                        57                                   57
                                                                                                     186,226                              323,528
Other Advances including Deposits and
Prepaid Expenses:
Unsecured-
Considered Good :
     Due from Subsidiaries                                                                           299,208                                  7,832
     Due from Bilt Paper Holdings Ltd.
     (a company under same management)                                                                15,419                              104,731
     {Maximum balance outstanding at any
     time during the year Rs. 104730523}
     Due from Others                                                                               1,454,959                              889,462
Considered Doubtful                                                                                      854                                   854
Interest Accrued -
Considered Good                                                                                            83                                   83

                                                                                                   1,770,523                            1,002,962

Loans:
Unsecured -
Considered Good
     To a Company                                                                                       4,698                                 4,359

                                                                                                        4,698                                 4,359

Balance with Customs and Port Trust                                                                     1,473                                 2,896

                                                                                                   1,962,920                            1,333,745

Other Advances include amount advanced to Directors Rs.63,48,000 /- (Maximum amount outstanding at any time during the year Rs.66,00,000/-)




                                                                       46
BALLARPUR INDUSTRIES LIMITED

                                                                                                                            As at 30th June
                                                                                                                                       2000
                                                                                            (Rs. ‘000)                            (Rs. ‘000)


SCHEDULE “K” : CURRENT LIABILITIES AND PROVISIONS

A) LIABILITIES :
     For Acceptances                                                                           88,017                              142,196
     Due to Subsidiary Companies                                                                8,358                                 8,123
     Deferred Payment Liabilities under rediscounting Scheme                                    7,914                               17,800
     Sundry Creditors – Small Scale Industrial Undertakings                                    27,951                               28,465
     Sundry Creditors – Others                                                              1,926,578                            2,248,156
     Interest free Sales Tax Loan / deferment                                                 181,282                              149,387
     Security Deposits (including interest accrued thereon)                                    35,297                               29,207
     Advances received from Customers                                                          50,313                               17,850
     Provision for Gratuity                                                                   326,877                              285,050
     Interest on Loans accrued but not due                                                    384,532                              236,183
     Trustees' Staff Welfare Account                                                              454                                   421
     Unclaimed Dividends/Dividend Payable                                                       6,235                                 4,312
     Employees Security Deposit                                                                   225                                   463
     Commission payable to Chairman / Vice Chairman & MD and other Directors                   23,840                                 3,000

                                                                                            3,067,873                            3,170,613

B)   PROVISIONS :
     For Taxation including MAT                                                               172,263                               87,349
     Less: Advance Payment including Tax
     deducted at source (Net)                                                                 115,913                               30,109
                                                                                               56,350                               57,240
     Proposed Dividends                                                                       264,343                              225,912
     Provision for Dividend Tax                                                                26,963                               49,701

                                                                                              347,656                              332,853

                                                                                            3,415,529                           3,503,466


SCHEDULE “L” : MISCELLANEOUS EXPENDITURE
(To the extent not written off or adjusted)

                                                                                             Expenses/           Written          Balance
                                                                                As at      Adjustment                 off            As at
                                                                        01.07.2000      during the year   during the year      30.06.2001
                                                                           (Rs. ‘000)        (Rs. ‘000)        (Rs. ‘000)        (Rs. ‘000)
                                                                                  (a)               (b)               (c)          (a+b-c)


Debenture Issue Expenses                                                        2,054                –             1,196               858
Approved Voluntary Retirement Scheme                                           17,773                –             5,665            12,108
Mckinsey Project Expenses                                                       6,487                –             4,771             1,716
Project Research & Development at Unit AP Rayons                               59,860          50,013            11,972             97,901
ERS Compensation                                                                9,754              200             3,718             6,236
Project Y2K Compliance                                                         26,734                –             6,683            20,051
Product Launch Expenses                                                         6,321            9,569             3,161            12,729
Enterprise Resource Planning (ERP)                                                 –           62,967                  –            62,967
                                                                           128,983            122,749            37,166           214,566




                                                                      47
                                                                                                            BALLARPUR INDUSTRIES LIMITED

SCHEDULE "M": SIGNIFICANT ACCOUNTING POLICIES AND NOTES

1.   SIGNIFICANT ACCOUNTING POLICIES:
     FIXED ASSETS :
     (A) Fixed Assets (other than those which have been revalued) are stated at their original cost including Freight, Duties, Taxes and other Incidental
         Expenses related to Acquisition and Installation. In the case of Revalued Assets in hand as at the close of the year the Book Value is inclusive of
         revaluation factor with corresponding credit under Revaluation Reserves.
     (B) Expenditure during construction period including interest on specific borrowings for new major projects are capitalised till the stabilisation of
         commercial production.
     (C) The Company capitalises its Assets (including Construction and Installation in Progress) at a value net of Modvat received /receivable in respect of
         Capital Goods.
     (D) DEPRECIATION :
           Depreciation on Fixed Assets is provided on Straight Line Method on certain Assets and on Written Down Value Method on other Assets in accordance
           with Schedule XIV of the Companies Act, 1956. Freehold Land is not depreciated. Depreciation on revalued portion of fixed Assets as applicable
           is appropriated and adjusted out of Revaluation Reserve available with the Company, on a global pooling basis.
     (E) INVENTORY VALUATION:
           Inventory valuation is made as per the following practices: -
           Finished Goods, Goods-in-Process                                                     :    At cost or net realisable value , whichever is lower
           Trading Goods                                                                        :   At Cost
           Non standard products                                                                :   At estimated realisable value
           Raw Material (other than own exploited)                                              :   At weighted average cost
           Stores and spares                                                                    :   At weighted average cost.
           Block Stores                                                                         :   At weighted average cost
           Own exploited Raw Materials                                                          :    At estimated cost.
     (F) INVESTMENTS :
           (a)   Investments made by the Company in various securities are primarily meant to be held over long term period.
           (b) (i)      Holding of certain Investments are of Strategic Importance to the Company and therefore, the Company does not consider it necessary
                        to provide for decrease in the Book Value of such Investments, till continuation of the relationship of Strategic Importance with the
                        Investee Company, namely that of a Subsidiary, Associate, Company under the same management, Foreign Joint Ventures and/or
                        Company associated with Thapar Group.
                 (ii)   However, appropriate provisions are made to recognise decrease in the Book Value of Investments in companies of Strategic
                        importance also, as and when the Investee Company is either wound up or goes into liquidation or where the operations cease or are
                        taken over by Receiver by Operation of Law.
           (c)   Investments in Government Securities are shown at cost and Investments, other than that of Strategic Importance to the Company are shown
                 in the books at lower of the cost or fair market value.
           (d) As a conservative and prudent policy, the Company does not provide for increase in the Book Value of individual investments held by it on the
               date of Balance Sheet.
     (G) DIVIDEND:
           Provision for Dividend as proposed by the Directors is made in the books of account, pending approval of the Shareholders at the Annual General
           Meeting.
     (H) FOREIGN CURRENCIES:
           The original cost of Fixed Assets, acquired through foreign currency loans are adjusted so as to show the liabilities for these loans, at the rates of
           exchange prevailing at the end of the accounting year or at the forward cover rates as applicable.
           Transactions in foreign currencies, covering current assets and current liabilities, are accounted for at exchange rates prevailing on the dates, the
           transactions take place. Net gains or losses arising out of subsequent fluctuations in exchange rates are shown under separate head in the Profit and
           Loss Account.
     (I)   REVENUE RECOGNITION:
           As per requirement of the Companies (Amendment) Act, 1988, all expenses and Income are accounted for on accrual basis
     (J)   RESEARCH & DEVELOPMENT:
           Revenue expenditure on Research and Development is charged to the Profit & Loss Account in the year in which it is incurred, Capital Expenditure
           on Research and Development is shown as an addition to Fixed Assets or work in progress, as the case may be.




                                                                               48
BALLARPUR INDUSTRIES LIMITED

      (K) RETIREMENT BENEFITS:
            (a)   Provision for Gratuity and for Leave encashable at the time of retirement (precisely, leave balance under Retirement Leave Reserve as per
                  Company's Service Rules) is made in the books on the basis of actuarial valuation.
            (b) The Company has an approved Superannuation Scheme for its officers (who are not covered under Payment of Bonus Act, 1965). Regular
                contributions are made in accordance with the Scheme and Trust Rules.
      (L) INCOME FROM INVESTMENTS:
            Income from Investments, where appropriate, are taken into revenue in full on declaration or receipt and tax deducted at source thereon is treated
            as advance tax.
      (M) ADVANCE LICENCE, IMPORT ENTITLEMENTS:
            Advance Licence and Import Entitlements accruing against exports made by the Company are accounted in the books only on their utilisation/disposal.

'2.   CONTINGENT LIABILITIES :
      (a)   Rs 38.77 Crores ( 30th June, 2000 Rs 39.46 Crores) approximately being claims against the Company not acknowledged as debts.
      (b) Guarantees given by the Company including in respect of Subsidiaries Rs. 5.80 Crores (30th June, 2000 Rs.25.64 crores).
      (c)   Bills Discounted with Banks and remaining outstanding as on 30th June, 2001, Rs.29.42 Crores (30th June, 2000 Rs.21.43 Crores).
      (d) The future obligation for the rentals under a Financial Lease Agreement entered into, by the Company, for certain assets taken on lease by another
          Company amounts to Rs. 1.01 Crores (30th June, 2000 Rs. 0.65 Crores).
3.    Guarantees given by bankers on behalf of the Company and outstanding amount to Rs.9.50 Crores (30th June, 2000 Rs. 13.87 Crores).
4.    Estimated amount of contracts remaining to be executed on Capital Account Rs 89.94 Crores (Net of Advances) (30th June, 2000 Rs. 132.44 Crores).
5.    Certain vehicles, EPABX System, Instruments, Computers and Machineries have been taken by the Company on a financial lease and the future obligation
      for the rentals under the lease amount to Rs 34.69 Crores (30th June, 2000 Rs 4.13 Crores).
6.    The Company has an investment of Rs 6.14 crores in the share capital of The Paperbase Company Ltd. , a subsidiary company. The Management is in the
      process of negotiating sale of its strategic investment, at a value not less than the book cost. Hence in the views of the Management and pursuant to the
      declared accounting policies, the diminution in the value of investments is considered to be of temporary nature.
7.    Liabilities include Rs 4.86 Crores ( 30th June, 2000 Rs.4.86 Crores ) payable to Central Government and State Government of Orissa after 10 years
      from the date of commencement of commercial production i.e. 25.9.92, in terms of Memorandum of Understanding dated 20.4.91 between the
      Company and Government of Orissa (in respect of Unit Choudwar).
8.    There are no specific claims from suppliers under the "Interest on delayed payments to Small Scale and Ancillary Act, 1993" except in case of Unit
      Choudwar , where a claim amounting to Rs.5.18 lacs has been settled during the year.
9.    As per the information received by the company, the Small scale industrial undertakings to whom the company owes a sum exceeding Rs. 1 Lakh which is
      outstanding for more than 30 days are as detailed below:
      Apex Knives P Ltd., Esbee Engg. Accessories, MBM Engineering, Maharastra Engineering Works, New Pack Plastic, Rubberx Sales Corpn., Sree Durga Engg.,
      Supreme Enterprises, Sri Laxmi Mahadevi, Prabhu Packaging Products Ltd., Ajanta Packing Industries, Cardinal Chemicals, Dev Resins Pvt. Ltd., Jammuna
                                                                                              .K.
      Minerals, Kakati Karshak Industries, Kalimata Moulding Works, Naushari Lal & Sons, P Enterprises, Saharanpur Packwell, Patiala Packing Industries,
      Rajasthan Barytes Ltd., Souvenior Ceramics, Shiva Metal Industries, Arora Industries, Andhra Dyechem, DB Engineering Pvt. Ltd., Enmas Process, Ganpati
      Laminators, Ispat Asbestors & Allied Products, Konark Alum Industries, Kay Bee Sulphates, Maharani Industrial Corporation, Mercury Cable Industries,
      New Pack Pvt. Ltd., Paramount Chemicals, Raja Alum Industries, Raghunath Dye Chem, Satyam Packers, Southern Hightech Chemicals, Srinivasa
      Industries, Sri Srinivasa Engg. Works, S K Cores & Containers, Tamilnadu Shafts Pvt. Ltd. & S B Engineering Enterprises.
10. Loans and Advances include Rs 1.76 Crores (30th June, 2000 Rs.1.61 Crores), being advances given in connection with expenditure incurred up to the
    current year on plantation on own land and on Crop-sharing basis which is being carried forward and will be adjusted in the future years during which
    the related raw materials are expected to be available to the Company's various Units.
11. The Company's unit Bengal Ingot at Calcutta continued to be under work suspension since February 1997. The Accounts of the unit have been prepared
    by the Management on the basis of estimates. These accounts incorporate the year end assets of Rs 5.85 crores and liabilities of Rs 1.02 crores and a net
    loss of Rs 0.73 crores as estimated.
12. MISCELLANEOUS EXPENDITURE (DEFERRED REVENUE EXPENDITURE)
      The following expenses have been treated as Deferred Revenue Expenditure, which is being written off over a period of five years:-
      (a)   Compensation paid under the Approved Voluntary Retirement Scheme and Early Retirement Scheme for its employees incurred during earlier years.
      (b) Expenses incurred and consultancy fees paid to M/s. McKinsey & Co. Inc. consultants for study and implementation of a major cost reduction
          exercise, in earlier years.
      (c)   Expenses incurred on Project Y2K compliance has been treated as Deferred Revenue Expenditure.
      (d) Expenses incurred on launch of new product of Royal Executive Bond has been treated as deferred revenue expenses to be written off in 3 years after
          introduction of the Product in the market. Expenses incurred during the year on launch of new product of Copy Power has been treated as deferred
          revenue expenses to be written off in 3 years after the year of introduction in the market.
      (e)   Expenses incurred during the previous year on Project Research & Development at Unit AP Rayons, Kamalapuram for which the project work was in
            continuation , shall be written off in 5 years from 2000-2001.
      (f)   During the year the Company has ventured into Enterprise Resource Planning (ERP). The expenditure on this Project, including fees payable to the
            Consultants and direct and Indirect overheads identified for this Project have been treated as Deferred Revenue Expenditure, to be amortised in 7
            years after successful implementation of the Project.



                                                                              49
                                                                                                           BALLARPUR INDUSTRIES LIMITED

13. Expenditure during the construction period relating to Paper Modernisation Projects, which are under execution, at our units Ballarpur, Shree Gopal and
    Sewa (inclusive of interest and foreign exchange fluctuation) amounted to Rs.333.97 Crores as on 30th June, 2001.
14. In these Accounts estimated liability has been provided towards Income Tax / MAT payable by the Company as computed under the Income Tax Act,
    1961.
15. Construction and Installation in Progress includes cost of bare Plant and Machinery amounting to Rs 54.40 Crores lying under the custody of Port
    Authorities/Bonded Warehouse. The Company has not offered the consignment for assessment of Custom Duty, Demurrage and Other Incidentals payable
    to JNPT and Bonded Warehouse Authorities. Since the liabilities for release of this capital equipment has not yet been assessed and determined, the
    management is of the opinion that the Duty and incidental Costs shall be adjusted in the Books of Account as and when the consignment is finally assessed
    and released from the Port Authorities.
16. In respect of borrowings from certain Financial Institutions and banks, the balance confirmation certificates are awaited. Further a number of accounts
    including those with certain interconnected companies are subject to reconciliation.
17. Pursuant to the Scheme of Arrangement & Reconstruction approved by the Hon'ble High Court of Mumbai ( Nagpur Bench), following additions were made
    to the value of fixed assets as on 1st April, 1997 as per business valuations by independent valuers and management estimates considered in the Balance Sheet
    as on 30th September, 1998, (after exclusion of Unit Ashti ) now stand revised as under:
                                                                                                                                                        (Rs.’000)
     Increase in the value of land                                                                                                                     198,288
     Increase in the value of Building                                                                                                                1405,189
     Increase in the value of Plant and Machinery                                                                                                    1,826,893

     Total                                                                                                                                           34,30,370

18. Pending settlement and complete documentation, borrowings of the Company, continue to cover a charge of lenders on the assets of BILT Chemicals Ltd,
    APR Packaging Ltd and Pulp division of erstwhile APR Ltd (now BILT Paper Holdings Ltd). The company is initiating the relevant documentation process
    to complete all the statutory formalities for transfer of properties in its name, as applicable.
19. The balance in Share Suspense Account represents Application money of Rs 116.05 lacs received in earlier years from a foreign share holder, pending refund.
20. During the year, Janpath Investments and Holdings Ltd, has prematurely redeemed balance Optionally Convertible Bonds, as mutually agreed.
21. Figures for the previous year have been rearranged and regrouped, wherever necessary to make them comparable to the classifications of current year.

                                                     Signatures to Schedules "A" to "M"
As per our report annexed
For K. K. MANKESHWAR & CO.,                                                                                  L M THAPAR              –    Chairman
Chartered Accountants
                                                                                                             GAUTAM THAPAR –              Vice Chairman &
ASHWIN MANKESHWAR                             R K CHOPRA                       NEERJA SHARMA                                              Managing Director
Partner                                       Vice President &                  Company Secretary            R R VEDERAH              –   Director
                                         Group Chief Accounts Officer
                                                                                                             B HARIHARAN              –   Director
Camp : Gurgaon                                                                                               Gurgaon
Dated : 27th July, 2001                                                                                      Dated : 27th July, 2001




                                                                              50
BALLARPUR INDUSTRIES LIMITED


Schedules “I” To “VIII”
ATTACHED TO AND FORMING PART OF THE PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 30TH JUNE, 2001

                                                                                               Previous Year
                                                       (Rs. '000)    (Rs. '000)   (Rs. '000)      (Rs. '000)


SCHEDULE "I": SALES AND OTHER REVENUES

(A) SALES :
     Paper                                             8,763,944                  7,758,573
     Less: Discount                                       66,072                     72,923
                                                                     8,697,872                   7,685,650

     Coated Paper                                       982,093                    889,487
     Less: Discount                                      34,484                     22,486
                                                                      947,609                      867,001

     Caustic Soda, Chlorine etc.                        298,529                    265,324
     Less: Discount                                         951                      1,459
                                                                      297,578                      263,865

     Rayon Grade Pulp                                                2,318,930                   2,097,441

     Steam and Power                                                 2,444,267                   2,499,361

     Autoclaved Aerated Concrete                                             –                      18,596

     Others                                                           969,868                    1,016,393

                                                                    15,676,124                 14,448,307
(B) OTHER REVENUES:
    Profit on sale of Manufacturing Units (Net)                              –                      15,555

                                                                             –                      15,555

                                                                    15,676,124                 14,463,862




                                                  51
                                                                                         BALLARPUR INDUSTRIES LIMITED

                                                                                                                   Previous Year
                                                                            (Rs. '000)   (Rs. '000)   (Rs. '000)      (Rs. '000)


SCHEDULE “II” : OTHER INCOME

Dividends (Gross)-
–    From Subsidiaries                                                                     33,096                             –
–    From Other Companies                                                                       –                             5
Interest - (Gross)
On Investments (Tax deducted at
Source Rs.Nil)                                                                              8,878                            69
Profit on Sales of Stores, Raw Materials etc.:
Sale Proceeds                                                                 19,398                    15,535
Less: Cost                                                                          –                      959
                                                                                           19,398                       14,576


Rent and Licence Fee (Gross) (Tax deducted at                                               2,007                        3,260
source Rs. 32457 )
Premium on Sale of Import Entitlement                                                           16                         132
Miscellaneous Income (Including Rs.2271401 for Insurance Claims )                          27,994                       19,721
Liabilities in respect of earlier years written back                                       35,697                       24,156
Profit on Sale of Assets (Net)                                                                   –                         391
Profit on Sale of Scrap                                                                          –                         349

                                                                                          127,086                       62,659




SCHEDULE “III” : INCREASE/(DECREASE) IN STOCKS

Opening Stock :–
      Finished                                                                            318,367                      318,560
      In Process                                                                           60,973                      148,075

                                                                                          379,340                      466,635
      Less: Adjustments relating to Units AP Rayons / Ashti in terms                             –                     128,482
      of approved scheme of arrangement and reorganisation
      Less: Adjustments relating to earlier years                                                –                      49,729


                                                                                          379,340                      288,424

      Less: Stock of Unit AAC, Palwal hived off                                                  –                       2,524

                                                                                          379,340                      285,900

Closing Stock :–
      Finished                                                                            430,704                      318,367
      In Process                                                                           72,716                       60,973


                                                                                          503,420                      379,340


Net                                                                                       124,080                       93,440




                                                                       52
BALLARPUR INDUSTRIES LIMITED

                                                                               Previous Year
                                                                  (Rs. '000)      (Rs. '000)

SCHEDULE “IV” : MANUFACTURING COSTS

Raw Materials consumed (Including Expenses thereon)               2,287,841      2,014,357
Stores and Spare Parts consumed                                   2,246,642      2,064,431
Power, Fuel and Water Charges                                     3,783,135      3,814,049
Repairs to Buildings                                                 23,104         21,546
Repairs to Machinery                                                182,173        122,670
Maintenance Building                                                  5,949          4,715
Maintenance Plant and Machinery                                     249,523        211,074
Repairs and Maintenance Sundries                                     46,480         39,754
Processing Charges                                                  181,932        143,699
Lease charges of Machinery                                           97,220          5,678
Other Expenses                                                       34,573         31,397

                                                                  9,138,572      8,473,370

SCHEDULE “V” : PERSONNEL COSTS

Salaries, Wages, Bonus & Gratuity                                 1,033,368        855,492
Directors' Commission on Profits                                    23,840           3,000
Contribution to Provident, Superannuation and Other Funds           84,160          72,955
Workmen and Staff Welfare Expenses                                  89,127          69,375

                                                                  1,230,495      1,000,822

SCHEDULE “VI” : ADMINISTRATION,
SELLING & MISCELLANEOUS COSTS

Rent                                                                 8,436           7,866
Lease Rent                                                          17,658           5,796
Rates and Taxes                                                     49,315          36,058
Insurance Charges                                                   33,467          46,793
Directors Fees                                                         160              73
Debenture Trustee Remuneration                                         688              71
Office and Other Expenses ( Including
Rs.13833529 for Research and Development)                          328,588         227,103
Commission                                                          15,986          30,715
Carriage and Freight                                               165,423         158,761
Cess, Royalty and Taxes                                                  –             472
Other Selling Expenses                                              99,439          92,340
Assets Discarded                                                     1,148           1,738
Unusable Stores & Spares written off                                     –           2,116
Foreign Exchange Rate Fluctuation (Net)                              2,735             366
Bad Debts and Claims written off (Net)                                 576             795
Loss on Sale of Assets (Net)                                        11,475               –

                                                                   735,094         611,063

SCHEDULE “VII” : INTEREST AND FINANCE COSTS

Interest :
On Debentures and Fixed Loans                                      640,420         810,689
On Other Accounts                                                  679,291         497,891
Finance and placement charges                                       84,457          24,273
Guarantee Commission paid to Banks                                  11,777           2,068

                                                                  1,415,945      1,334,921

Less: Interest earned (including accrued premium on Bonds)         174,197         206,791
(Tax deducted/deductible at source Rs. 33264643)

                                                                  1,241,748      1,128,130




                                                             53
                                                                                                                   BALLARPUR INDUSTRIES LIMITED

SCHEDULE ‘VIII’ :

ADDITIONAL INFORMATION PURSUANT TO THE PROVISIONS OF PARAGRAPH (3) TO (4D) OF PART II OF SCHEDULE VI OF COMPANIES
ACT, 1956 TOGETHER WITH OTHER NOTES.

1.    Particulars in respect of goods Manufactured, Licensed and Installed Capacities:

Class of Goods                                                    LICENSED CAPACITY                INSTALLED CAPACITY               ACTUAL PRODUCTION
                                                                      (ANNUAL)                          (ANNUAL)
                                                       Unit         Current             Previous       Current           Previous      Current         Previous
                                                                       Year                 Year          Year               Year         Year             Year

Paper including Wrapper                                M.T.        2,54,500           2,27,730        2,01,368          1,98,368      2,41,191      2,36,969(c)

Coated Paper                                           M.T.               (a)                (a)            40                40     22,095(b)       21,663(b)
                                                                                                     (Per day)          (Per day)

Caustic Soda                                           M.T.           28,100            28,100          26,400            26,400        14,684          16,412

Chlorine                                               M.T.           14,310            14,310          12,810            12,810        11,158          12,246

Hydrochloric Acid                                      M.T.            9,950              9,950           9,950            9,950        11,058          11,208

Hypochlorite                                           M.T.           10,980            10,980          10,980            10,980          1,233          1,885

Rayon Grade Pulp                                       M.T.           98,550            98,550          98,550            98,550        89,296          89,779

Non Ferrous Ingots & Casting                           M.T.                 0                 0           4,380            4,380               0             0

Alloy Steel Castings                                   M.T.            3,000              3,000           1,200            1,200               0             0

Building Panel Boards                              Sq.Mtrs.        6,12,000           6,12,000        6,12,000          6,12,000               0             0

Autoclaved Aerated Concrete                       Cu. Mtrs.               (d)         1,70,000               (d)        1,70,000             (d)        11,983


(a)   No Licence under the Industries (Development & Regulation) Act, 1951 is required.
(b)   Converted out of Paper manufactured by the Company.
(c)   Does not include the recycled (damaged due to Super Cyclone) finished goods of 111 MT
(d)   The Company had transferred its AAC Palwal unit to another Company w.e.f 1.4.2000 .


NOTES :
(1)   Company holds C.O.B. License for manufacture of Copper and Aluminium base Alloys and Castings for 1400 M.T. per annum at Unit-Bengal Ingot.
(2)   The Licensed Capacity, Installed Capacity and Actual Production of Paper & Wrapper include Specialised Grades of Paper.




                                                                                   54
BALLARPUR INDUSTRIES LIMITED

2.     Particulars in respect of Purchases, Stock of Finished Goods and Sales:
(a) Purchases :

            Particulars                                                                                      CURRENT YEAR                              PREVIOUS YEAR
                                                             Unit of Quantity                           Quantity                Value              Quantity                  Value
                                                                                                                             (Rs.’000)                                   (Rs.’000)
            Others                                                                                                            483,398                                   1,013,129

                                                                                                                              483,398                                   1,013,129
(b) Stock of Finished Goods and Sales :

Class of Goods                 Unit of                OPENING STOCK                                      CLOSING STOCK                                  SALES
                               Quantity      Current Year           Previous Year                Current Year         Previous Year         Current Year         Previous Year
                                         Quantity      Value     Quantity        Value Quantity    Value Quantity     ValueQuantity    Value Quantity                         Value
                                                    (Rs.’000)                (Rs.’000)          (Rs.’000)         (Rs.’000)         (Rs.’000)                             (Rs.’000)
Paper including Wrapper          M.T.        4569    113,847        7533      211,704            4159    125,564      4569    113,847     241601 8,697,872 239933 7,685,650
Coated Paper                     M.T.         636     19,427         520       18,694            1302     47,900       636     19,427     21429     947,609     21547     867,001
Caustic Soda                     M.T.         337      3,144         322           3,206         232       3,044       337      3,144     14789     202,492     16397     192,895
Chlorine                         M.T.          71        396          91            474            49       255         71        396     11180      53,675     12266      37,821
Hydrochloric Acid                M.T.         189        240         188            220          247        435        189        240     11000      33,536     11207      12,368
Hypochlorite                     M.T.           0           0          0              0             0           0        0            0    1233        7,875     1885      11,509
Non-Ferrous Ingots/Castings      M.T.           7      2,070           7           1,772            7      2,070         7      2,070         0            0        0            0
Alloy Steel Castings             M.T.           1           50         1             43             1        50          1         50         0            0        0            0
Rayon Grade Pulp                 M.T.          26        563         726       16,541           1977      46,436        26        563     87345 2,318,930       90515 2,097,441
Building Panel Boards         Sq.Mtrs.      14279        470       14279            470         14279       470      14279        470         0            0        0            0
Autoclaved Aerated
Concrete                  Cu.Mtrs.              0           0       2311           2,694            0           0        0            0       0            0    13060      18,596
Others                                               178,160                       9,524                 204,480              178,160              3,414,135             3,525,026


                                                     318,367                  265,342                    430,704              318,367             15,676,124            14,448,307


3.     Analysis of Materials consumed :

                                                                                                                    QUANTITY                               AMOUNT
                                                                            Unit                        Current               Previous             Current                Previous
                                                                                                           Year                   Year                Year                    Year
                                                                                                                                                   Rs. '000               Rs. '000
Bamboo                                                                      M.T.                        293,901               300,523              611,211               596,591
Wood and Wood Waste                                                         M.T.                        493,390               438,943              738,046               648,961
Grass of various kinds                                                      M.T.                           5,273               25,750                 5,953               30,171
Rags and Yarn waste                                                         M.T.                                0               3,886                      0                5,544
Salt                                                                        M.T.                         25,416                28,732               29,302                38,749
Wood Pulp                                                                   M.T.                           6,468                8,797              147,516               167,274
Casuarina                                                                   M.T.                        250,392               248,668              512,140               495,297
Eucalyptus                                                                  M.T.                         34,127                27,365               51,464                54,885
Subabul                                                                     M.T.                         82,443                86,128              140,597               148,969

Others                                                                                                                                              64,114                57,036


                                                                                                                                                  2,300,343             2,243,477

Raw Materials worth Rs.12501534 (Previous year Rs.2140177) consumed during the period have been charged to other heads of Account.




                                                                                           55
                                                                                                                    BALLARPUR INDUSTRIES LIMITED

4.   Value of imports on C.I.F. Basis :
                                                                                                                 Current Year                                 Previous Year
                                                                                                                    (Rs. '000)                                    (Rs.'000)

     a)     Raw Materials                                                                                                50,388                                     79,419
     b)     Components, Spare Parts and Other Stores                                                                     74,785                                     75,667
     c)     Capital Goods                                                                                               156,763                                            0
     d)     Others                                                                                                       88,355                                     73,751

                                                                                                                        370,291                                    228,837


Note: Imported raw material procured from canalising agencies have been considered as indigenous.




5.   Expenditure in Foreign Currency :

                                                                                                                 Current Year                                 Previous Year
                                                                                                                    (Rs. '000)                                    (Rs. '000)

     i)     Foreign Travel, Commission, Claims, Consultancy Fees,
            Deferred payment Installments, Subscriptions, etc.                                                          108,722                                    109,753
     ii)    Installments towards Foreign Currency Loan                                                                  505,095                                    352,692
     iii)   Interest on FC Loan (ECB)                                                                                   154,642                                    133,711
                                                                                                                        768,459                                    596,156


Note: Payments made towards interest and Installments to the Financial Institutions against foreign currency loans raised from them have not been indicated herein above since
      these remittances were not effected directly by the Company in foreign currency.


6.   Earnings in Foreign Exchange on Cash Basis :

                                                                                                                 Current Year                                 Previous Year
                                                                                                                    (Rs. '000)                                   (Rs. '000)


      a)    F.O.B. Value of exports.                                                                                    426,066                                    739,335
     b)     Others                                                                                                        9,463                                       6,603

                                                                                                                        435,529                                    745,938




                                                                                     56
BALLARPUR INDUSTRIES LIMITED

7.   Value of Imported raw materials, spare parts and components (excluding stores) consumed and the value of all indigenous raw materials,
     spare parts and components (excluding stores) similarly consumed and the percentage of each to the total consumption.

                                                                                                           AMOUNT                                   PERCENTAGE
                                                                                                Current              Previous            Current            Previous
                                                                                                   Year                  Year               Year                Year
                                                                                                Rs. '000             Rs. '000
     a)      Raw Materials - Imported                                                            84,581               91,075                 3.68                4.06
     b)      Raw Materials - Indigenous                                                       2,215,762           2,152,402                 96.32             95.94

                                                                                              2,300,343           2,243,477               100.00            100.00


     a)      Spare Parts and Components - Imported                                               70,129               43,621                19.76             16.47
     b)      Spare Parts and Components - Indigenous                                            284,780             221,286                 80.24             83.53

                                                                                                354,909             264,907               100.00            100.00
Notes : (i)      Consumption of Raw Materials, Components and Spare Parts includes estimated value of Stocks brought forward from earlier period.

          (ii)   Consumption of Imported items purchased from canalising agencies have been considered as indigenous items.


8.   Particulars of amounts remitted during the year in foreign currencies on account of dividends, the number of non-resident shareholders
     together with the number of shares held by them on which the dividends were due and the year to which the dividends related.
                                                       Number of Non-Resident                        Number of Shares                 Amount                Amount
                                                    Shareholders to whom dividends                    held by them                    Rs. '000              Rs. '000
                                                        remitted during the year.
                                                      Current                Previous           Current              Pervious            Current            Previous
                                                         Year                    Year              Year                  Year               Year                Year
             Class of Shares:
             Ordinary                       1999-2000 Three                       Two       11,803,825           10,003,825               29,510            12,005
             Preference                      1999-2000 One                        One         3,963,500           3,963,500               43,599            32,609


9.   Sales Turnover includes internal transfers:
                                                                                                                    Current                                 Previous
                                                                                                                       Year                                     Year
                                                                                                                    Rs. '000                                Rs. '000
     At Selling Prices                                                                                            3,198,551                               2,996,575
      At Cost Prices                                                                                                  47,616                                84,406
      Total                                                                                                       3,246,167                               3,080,981


10. Expenses of Forests, Lime Kiln, Water Works and those for own Departmental transport charged in these accounts include the following :
                                                                                                                    Current                                 Previous
                                                                                                                       Year                                     Year
                                                                                                                    Rs. '000                                Rs. '000
     Salaries and Wages                                                                                               69,574                                58,505
     Contribution to Provident and Other Funds                                                                         4,230                                 4,612
     Insurance                                                                                                           348                                 2,153
     Rent, Rates and Taxes (Incl. Lease Rent)                                                                          5,678                                 7,247
     Staff Welfare                                                                                                     3,809                                 2,378
     Repairs and Maintenance to Machinery                                                                              5,077                                 2,919
     Repairs and Maintenance to Building                                                                                  17                                    46
     Repairs and Maintenance - Others                                                                                    122                                 2,793
     Power and Fuel                                                                                                   98,835                               103,950
     Office and Other Expenses                                                                                         7,525                                11,261

                                                                                                                    195,215                                195,864




                                                                                   57
                                                                                                           BALLARPUR INDUSTRIES LIMITED

11. Statement showing computation of Net Profits in accordance with Section 198 read with Section 309(5) of the Companies Act, 1956
                                                                                                                                                     Current
                                                                                                                                                        Year
                                                                                                                                                     Rs. '000
Profit as per Profit & Loss Account before Taxation                                                                                                1,088,333
Less: Adjustments relating to earlier years                                                                                                           43,584
Add back -
     Directors fees                                                                                                                                       160
     Remuneration paid/payable to Chairman, Vice Chairman & Mg. Director & Other Directors                     18,631
     Profit Commission to Chairman and Vice Chairman & Mg. Director                                            21,740
     Commission to other Directors (as approved)                                                                2,100
                                                                                                                                                      42,471
                                                                                                                                                   1,087,380
Profits Under Section 198
Remuneration Under Section 198 @ 11% of above                                                                                                        119,612
Amount of Profit Commission as approved by Board
to be shared as under :
Chairman                                                                                                       10,870
Vice Chairman & Managing Director                                                                              10,870
Other Directors                                                                                                 2,100
                                                                                                                                                      23,840
Actual remuneration including Commission & Perquisites                                                                                                42,471
12. Remuneration paid/payable to Chairman, Vice Chairman & Managing Director and Directors
                                                                                                             Current                                  Previous
                                                                                                                Year                                      Year
                                                                                                             Rs. '000                                 Rs. '000
     Salary (Including Commission of Rs.2,38,40,000 payable both to                                            36,481                                   9,150
     Executive and non-Executive Directors)
     Contribution to Provident and Superannuation Funds                                                         3,344                                   1,661
     Perquisites                                                                                                2,646                                     904
                                                                                                               42,471                                 11,715
Having regard to the fact that there is a global computation of Gratuity, the amount applicable to an individual employee is not ascertainable and accordingly,
contribution to Gratuity has not been considered in the above computation.

13. Amount paid/payable to Auditors:
                                                                                                             Current                                  Previous
                                                                                                                Year                                      Year
                                                                                                             Rs. '000                                 Rs. '000
     Audit Fees (including Cost Audit Fee
     of Rs. 128,296 - Previous Year Rs.85,676)                                                                  2,282                                   2,188
     In Other Capacity                                                                                            835                                     450
     Out of Pocket Expenses (including Rs.55670
     - Previous year Rs.25071 to Cost Auditors)                                                                   226                                     230
                                                                                                                3,343                                   2,868

14. Depreciation charged for the year and debited to the Profit & Loss Account includes Rs. 16.85 cr. being depreciation on the revalued portion of Fixed
    Assets, since the Revaluation reserve stood exhausted during the year.
15. The aggregate value of Stores and Spare parts consumed during the year amounts to Rs.24716.84 lacs (Previous year Rs.21275.46 lacs) which were
    charged to various account heads including capital expenditure.
16. Figures for previous year have been rearranged and regrouped wherever necessary.
                                                              Signatures to Schedules ‘I’ to ‘VIII’

For K. K. MANKESHWAR & CO.,                                                                                 L M THAPAR             –    Chairman
Chartered Accountants
                                                                                                            GAUTAM THAPAR –             Vice Chairman &
ASHWIN MANKESHWAR                             R K CHOPRA                       NEERJA SHARMA                                            Managing Director
Partner                                       Vice President &                  Company Secretary           R R VEDERAH             –   Director
                                         Group Chief Accounts Officer
                                                                                                            B HARIHARAN             –   Director
Camp : Gurgaon                                                                                              Gurgaon
Dated : 27th July, 2001                                                                                     Dated : 27th July, 2001



                                                                               58
BALLARPUR INDUSTRIES LIMITED


Cash Flow Statement for the Year Ended 30th June, 2001
(Pursuant to Clause 32 of the Listing Agreement)
                                                                                30.06.2001           30.06.2000
                                                                          (12 months period)   (12 months period)
                                                                                 (Rs. ‘000)            (Rs. ‘000)

A.   CASH FLOW FROM OPERATING ACTIVITIES

     Net Profit before Tax, Appropriations and Extraordinary items               1,088,333               692,897
     Add / (Less):
          Dividend Income (Investing Activity)                                    (33,096)                    (5)
          (Profit) / Loss on sale of assets (Investing Activity)                    11,475                  (391)
          Liabilities in respect of earlier years written back                    (35,697)              (24,156)
          Profit/consideration on sale of Mfg. units                                     –              (15,555)
          Loss on discarding of assets                                               1,148                 1,738

                                                                                 1,032,163              654,528

     Adjustments for Non-Cash items :
          Depreciation                                                            751,019                569,106
          Deferred revenue expenses amortised                                       37,166                60,752
          Bad debts written off                                                        576                   795
          Unusable stores written off                                                    –                 2,116
          Interest (net)                                                         1,241,748             1,128,130

     Operating Profit before Working Capital changes                             3,062,672             2,415,427

     Adjustments for Working Capital changes :
          Trade payable and others                                               (217,315)             (107,569)
          Inventories                                                            (343,453)             (242,248)
          Trade and other receivables                                            (263,223)              (25,047)
          Loans and Advances                                                       (4,821)              (58,340)

     Cash generated from Operations                                              2,233,860             1,982,223


          Deferred Revenue expenditure (net)                                     (122,749)             (397,216)
          Interest and Financing charges (net)                                 (1,187,355)           (1,297,987)
          Exceptional Losses                                                             –              (12,485)
          Direct Taxes (net)                                                      (86,390)                (9,563)

     Cash flow before adjustments relating to earlier years                       837,366                264,972
          Adjustment relating to earlier years                                    (43,584)              (37,355)

     NET CASH INFLOW FROM OPERATING ACTIVITIES                                    793,782                227,617


B.   CASH FLOW FROM INVESTING ACTIVITIES
                                          ,
     Increase in Fixed Assets, Capital WIP Capital Advances                    (1,301,767)             (865,105)
     Sale of Assets                                                                 71,701                99,263
     Purchase of new Investments                                                 (455,414)                    (5)
     Redemption of Investments                                                    486,008                594,047
     Loans & Advances (net)                                                      (200,456)                 5,871
     Revenue from sale of units (net)                                                    –                15,555
     Dividend received                                                              33,096                     5

     NET CASH USED IN INVESTING ACTIVITIES                                     (1,366,832)             (150,369)




                                                                     59
                                                                                                          BALLARPUR INDUSTRIES LIMITED

                                                                                                        30.06.2001                              30.06.2000
                                                                                                  (12 months period)                      (12 months period)
                                                                                                         (Rs. ‘000)                               (Rs. ‘000)

C.   CASH FLOW FROM FINANCING ACTIVITIES

     Proceeds from issuance / (Repayment) of Preference Share Capital (net)                                    85,000                                110,120
     Increase / (Decrease) in long term and other borrowings (net)                                         1,121,122                                 (16,093)
     Share / Debenture Issue expenses                                                                      (103,256)                                   (5,963)
     Premium on redemption on debentures                                                                           –                                  (3,676)
     Dividend Paid (including dividend tax)                                                                (293,542)                                (116,056)

     NET CASH FROM FINANCING ACTIVITIES                                                                      809,324                                 (31,668)

     NET INCREASE IN CASH AND CASH EQUIVALENTS                                                               236,274                                   45,580

     CASH AND CASH EQUIVALENTS (OPENING BALANCE)                                                             366,868             292,307

     Add : Adjustments of Cash balance in terms of Scheme of Arrangement &                                                         28,981
           Reorganisation

     CASH AND CASH EQUIVALENTS ( OPENING BALANCE-REVISED)                                                            –                               321,288

     CASH AND CASH EQUIVALENTS (CLOSING BALANCE)                                                             603,142                                 366,868

NOTES
1.   The above statement has been prepared following the Indirect Method.
2.   Increase in Fixed Assets are stated inclusive of movements of Capital work in progress and Capital advances between the beginning and the end of the year.
3.   Proceeds from long term and other borrowings are shown net of repayments.
4.   Cash and Cash Equivalents represent Cash and Bank Balances only.
5.   Figures for the previous year have been re-grouped / re-classified wherever necessary.


                                                                                                            L M THAPAR             –     Chairman

                                                                                                            GAUTAM THAPAR –              Vice Chairman &
Gurgaon                                      R K CHOPRA                       NEERJA SHARMA                                              Managing Director
Date : 27th July, 2001                       Vice President &                  Company Secretary            R R VEDERAH             –    Director
                                        Group Chief Accounts Officer
                                                                                                            B HARIHARAN             –    Director



                                                             AUDITORS’ CERTIFICATE

We have verified the enclosed Cash Flow Statement of Ballarpur Industries Limited derived from the audited financial statements for the year ended 30th June
2001 and found the same to be drawn in accordance therewith and also with the requirements of Clause 32 of the listing agreement with Stock Exchanges.




                                                                                                                         For K. K. MANKESHWAR & CO.
                                                                                                                                     Chartered Accountants


Camp : Gurgaon                                                                                                                  ASHWIN MANKESHWAR
Dated : 27th July, 2001                                                                                                                       Partner




                                                                             60
BALLARPUR INDUSTRIES LIMITED


Statement Regarding Subsidiary Companies Pursuant to Section 212 of the Companies Act, 1956
1. Name of Subsidiary              Janpath Investments &           Bilt Tree Tech             The Paper Base                The Pioneer Limited                       **JG Containers
                                   Holdings Limited                Ltd.                       Co.Ltd.                                                                 (Malaysia) SDN BHD.

2. Holding Company’s               Holders of the entire          Holders of 9,90,000         Holders of 9,99,930           Deemed Subsidiary under                   Deemed Subsidiary
   Interest                        subscribed Capital comp-       Equity Shares               Equity Shares of Rs.10/-      section 4(1)(c) of the Compa-             under Section 4(1)(c)
                                   rising of 3,89,89,200 Equity   of Rs.10/- each             each out of the subs-         nies Act, 1956 since Janpath              of the Companies Act,
                                   Shares of Rs.10 each,          out of the total            cribed capital of             Investments & Holdings Ltd.,              1956 since Janpath
                                   and holders of the entire      Subscribed Capital          10,00,000 Equity Shares       a subsidiary of the Company               Investments & Holdings
                                   Subscribed Capital of          o f 10,80,000               and the entire                holds 3,27,28,650 Equity                  Ltd., a subsidiary of the
                                   400,00,000 5%                  Equity Shares of            Subscribed Capital of         Shares of Rs. 10/- each out of            Company holds
                                   Redeemable Cumulative          Rs.10/- each.               3,00,000 25%                  the Subscribed Capital of                 119,41,431 Ordinary
                                   Preference Shares of                                       Redeemable Non-               3,29,98,640 Equity Shares of              Shares of RM 1/- each
                                   Rs. 10/- each. Out of                                      Convertible Cumulative        Rs. 10/- each and 9,16,133                out of subscribed
                                   subscribed Equity Capital                                  Preference Shares of          15% Cumulative Redeemable                 Capital of 1,83,88,111
                                   80 Equity shares are held                                  Rs. 100/- each.               Preference Shares of Rs. 100/-            Ordinary Shares of
                                   jointly with its nominees                                                                each out of the Subscribed                RM 1/- each.
                                                                                                                            Capital of 12,00,000
                                                                                                                            15% Cumulative Redeemable
                                                                                                                            Preference Shares of
                                                                                                                            Rs. 100/- each

3. Net aggregate amount
   of Subsidiaries’ profits
   less losses and not
   dealt with in the
   Company’s Accounts.
    i)   For the subsidiaries’
         financial year ended                   Rs.6,10,71,851                  Rs.1,60,909                Rs.4,71,15,823              Rs.2,43,46,194                    Rs.2,20,66,736
         31st March, 2001                           (Profit)                      (Profit)                     (Loss)                      (Loss)                            (Loss)
    ii) For the previous
        financial years since                   Rs.1,94,56,903                 Rs.14,52,751                Rs.5,26,21,033              Rs.43,17,07,343                  Rs. 2,77,15,910
        it became subsidiary.                        (Loss)                       (Profit)                      (Loss)                      (Loss)                           (Profit)

4. Net aggregate amount of
   subsidiaries’ profits less
   losses and dealt with in
   the Company’s Accounts.
    i)   For Subsidiaries’
         financial year ended
         31st March, 2001.                            Nil                           Nil                          Nil                          Nil                              Nil
    ii) For the previous
        financial years since it
        became subsidiary.                            Nil                           Nil                          Nil                          Nil                              Nil

5. No Material Changes, other than as stated below, have occurred between the end of the preceeding financial year of the Subsidiary and the end of the Holding Company's financial year, in
   respect of the subsidiary's :-
   i) Fixed Assets
   ii) Investments
   iii) Moneys lent by it
   iv) Moneys borrowed by it for any purpose other than that of meeting current liabilities.

                                                                                                                                        ** As per audited accounts for the year ended 31.12.2000




                                                                                                                                    L M THAPAR                   –      Chairman

                                                                                                                                    GAUTAM THAPAR –                     Vice Chairman &
Gurgaon                                                    R K CHOPRA                            NEERJA SHARMA                                                          Managing Director
Date : 27th July, 2001                                     Vice President &                       Company Secretary                 R R VEDERAH                   –     Director
                                                      Group Chief Accounts Officer
                                                                                                                                    B HARIHARAN                   –     Director




                                                                                               61
                                                                                                                  BALLARPUR INDUSTRIES LIMITED


Additional Information Pursuant to the Provisions of Part-IV of Schedule VI of Companies Act, 1956

BALANCE SHEET ABSTRACT & COMPANY’S GENERAL BUSINESS PROFILE

I.     REGISTRATION DETAILS

       Registration No.                             1   0   3    3     7           State Code :           1   1

       Balance Sheet Date :                     3   0       0    6             2     0     0   1
                                                Date        Month                     Year

II.    CAPITAL RAISED DURING THE YEAR: (Amount in Rs. Thousands)
                                                                           *
       Public Issue :                           1   1   8   8    7     5           Rights Issue :                             N   I   L

       Bonus Issue :                            N   I   L                          Private Placement :                        1   1   5   0     0    0
                                                                                                                          (Preference Shares)
       *11887469 Ordinary Shares of Rs.10/- each allotted during the year as fully paid up, in terms of scheme of Arrangement and Reorganisation

III.   POSITION OF MOBILISATION AND DEPLOYMENT OF FUNDS: (Amount in Rs. Thousands)

       Total Liabilities :             2    0   6   2   7   7    9     1           Total Assets :                     2   0   6   2   7   7     9    1

       SOURCES OF FUNDS:

       Paid-Up Capital :                    1   3   0   7   0    4     7           Reserves & Surplus :                   7   6   6   3   3     1    0

       Secured Loans :                      8   8   6   1   5    8     3           Unsecured Loans :                      2   7   8   4   2     4    6

       APPLICATION OF FUNDS:

       Net Fixed Assets :              1    6   7   7   9   7    1     5           Investments :                          1   3   1   2   0     3    2

       Net Current Assets :                 2   3   2   1   4    7     8           Misc. Expenditure :                        2   1   4   5     6    6

       Accumulated Losses :                     N   I   L

IV.    PERFORMANCE OF THE COMPANY: (Amount in Rs. Thousands)

       Turnover & Other Revenues :     1    5   8   0   3   2    1     0           Total Expenditure :                1   4   7   1   4   8     7    7

       Profit/ Loss before Tax :            1   0   8   8   3    3     3           Profit/Loss after tax :                1   0   0   2   8     3    3

       Earning Per Share in Rs.                     1   4    .   0     1           Dividend Rate (%) :                                          3    0

V.     GENERIC NAMES OF THE THREE PRINCIPAL PRODUCTS/SERVICES OF THE COMPANY

       Item Code No. (ITC Code)        4    8   1   0   .   0    0     0

       Product Description             P   A    P   E   R


       Item Code No. (ITC Code)        4    7   0   2

       Product Description             W O O        D       P    U     L       P


       Item Code No. (ITC Code)        2    8   1   5   1   1    .     0       1

       Product Description             C   A    U   S   T    I   C             S      O   D    A


For K. K. MANKESHWAR & CO.,
Chartered Accountants
                                                                                                                  L M THAPAR          –   Chairman
Ashwin Mankeswar
Partner                                                                                                           GAUTAM THAPAR –         Vice Chairman &
                                                                                                                                          Managing Director
Camp : Gurgaon                               R K CHOPRA                               NEERJA SHARMA               R R VEDERAH         –   Director
Date : 27th July, 2001                       Vice President &                          Company Secretary
                                        Group Chief Accounts Officer                                              B HARIHARAN         –   Director


                                                                                     62
JANPATH INVESTMENTS AND HOLDINGS LIMITED


Directors’ Report
FOR THE YEAR ENDED 31ST MARCH, 2001
                                                                                        for Non-Banking Financial Companies laid down by the Reserve Bank of India,
To the Members,
                                                                                        an Audit Committee was constituted during the year. The Committee
The Directors are pleased to submit their Report on the working of the                  comprises of Messrs Gautam Thapar, S K Khandelwal and A K Chatterjee as
Company together with the Audited Statement of Accounts of the Company                  the members, with Mr Gautam Thapar being the Chairman.
for the year ended 31st March, 2001.

                                                                                        AUDITORS
FINANCIAL RESULTS
                                                                                        Messrs G. Basu & Co., Chartered Accountants, Auditors of the Company,
                                               2000-2001           1999-2000
                                                      Rs.                 Rs.           retire at the ensuing Annual General Meeting. Necessary notice confirming
                                                                                        their eligibility for re-appointment as Auditors of the Company has been
Income                                       36,57,08,209       17,51,47,604
                                                                                        received from them. A proposal for their re-appointment shall accordingly be
Profit / (Loss) before Taxation               6,10,81,851        2,01,38,628
Less : Provision for Interest Tax                       –           1,20,000            placed at the ensuing Annual General Meeting.
Less : Provision for Wealth Tax                    10,000                  –
Profit / (Loss) after taxation                6,10,71,851        2,00,18,628            AUDITORS' REPORT
Balance brought forward from
previous year                                 2,00,18,628                     –         The Auditors' comments in clauses 4 and 5 are self explanatory and no further
Transfer to Reserve Fund                                                                explanation is considered necessary. Their comments regarding diminution in
(as per RBI Act, 1934)                        1,50,00,000                     –         book value of investments in a foreign joint venture subsidiary Company read
Dividend on 5% Redeemable
                                                                                        with note no. 7 in schedule "K" and their comments in clauses 3 and 10 of their
Cumulative Preference
Shares of Rs. 10/- each                       3,30,95,890                     –         report read with note no. 3 in schedule "K" and para 12 under schedule "F" to
Dividend Tax                                    33,75,781                     –         the accounts, respectively, are also self explanatory and no further explanation
Balance carried over to the                                                             is considered necessary.
Balance Sheet                                 2,96,18,808         2,00,18,628

                                                                                        SUBSIDIARIES
DIVIDEND                                                                                As required under Section 212 of the Companies Act 1956, the statement
The Directors recommend a dividend of 5% on the Redeemable Cumulative                   and accounts of the subsidiary Companies viz. The Pioneer Limited and Jg
Preference Shares of Rs. 10/- each for the period 5th August, 1996 to 31st              Containers (Malaysia) Sdn Bhd., are attached herewith and form part of this
March, 1998. If approved at the forthcoming Annual General Meeting, the                 report.
dividend shall be paid out of the profits of the Company to those shareholders
whose names appear on the list of Preference Shareholders as on the date of
                                                                                        INFORMATION PURSUANT TO SECTION 217 (1) (e) OF THE
the Annual General Meeting.
                                                                                        COMPANIES ACT, 1956
                                                                                        During the year under review, foreign exchange equivalent to
PREMATURE REDEMPTION OF BONDS                                                           Rs. 131,27,13,370/- accrued to the company on sale of investments in a
During the year, the Company prematurely redeemed in full 10,800 optionally             foreign joint venture company. Necessary approval has been obtained from
convertible bonds of Rs. 1,00,000/- each, aggregating to Rs. 108 crores to              The Reserve Bank of India for extension of time for repatriation of sale proceed.
M/s Ballarpur Industries Limited. As per the terms of the issue, the said bonds         The Company spent foreign exchange equivalent to Rs. 125,00,000/- towards
were to be redeemed in 5 annual installments ending on 30th September,                  acquisition of shares of a foreign Company and spent foreign exchange equivalent
2004.                                                                                   to Rs. 46,610/- towards payment of custodian fee.
                                                                                        The Company being an Investment Company, the provisions of Section 217
DIRECTORS                                                                               (1) (e) in respect of Conservation of Energy and Technology Absorption read
           .
Messrs O. P Malhotra and G. C. Das, Directors of the Company, retire by                 with Companies (Disclosure of Particulars in the Report of the Board of
rotation at the forthcoming Annual General Meeting of the Company and are               Directors) Rules, 1988 are not applicable.
eligible for re-appointment.
Mr Vinod Sharma was appointed as an Additional Director of the Company                  INFORMATION PURSUANT TO SECTION 217 (2A) OF THE
w.e.f. 21st May, 2001, and holds office till the ensuing Annual General Meeting.        COMPANIES ACT, 1956
Necessary notice in terms of Section 257 of the Companies Act, 1956, has                There was no employee in the Company, who if employed throughout the
been received. A proposal for his appointment, as Director shall be placed at           year, was in receipt of remuneration of Rs. 12,00,000/- per annum and above
the Annual General Meeting for the consideration of the shareholders.                   and if employed for a part of the year, was in receipt of remuneration of
                                                                                        Rs.100,000/- per month and above. The particulars, as required by Section
AUDIT COMMITTEE                                                                         217(2A) of the Companies Act, 1956, read with Companies (Particulars of
In terms of Section 292A of the Companies Act, 1956, and Prudential Norms               Employees) Rules, 1975, have accordingly not been furnished.




                                                                                   63
                                                                                           JANPATH INVESTMENTS AND HOLDINGS LIMITED


DEPOSITS                                                                                    the Act for safeguarding the assets of the Company and for preventing
The Company has not accepted any public deposits during the year. Hence                     and detecting fraud and other irregularities;
no information is required to be appended to this report in terms of Non              d)    The Directors have prepared the Accounts on a going concern basis.
Banking Financial Companies Acceptance of Public Deposits (Reserve Bank)
Directions, 1998.                                                                     ACKNOWLEDGMENTS
                                                                                      The Directors wish to place on record their gratitude for the valuable assistance
DIRECTORS RESPONSIBILITY STATEMENT                                                    and cooperation extended to the Company from time to time by all outside
a)   In the preparation of the annual accounts, the applicable accounting             agencies.
     standards have been followed along with proper explanation relating to
     material departures, if any;                                                                                           For and on behalf of Board of Directors
b)   The Directors have selected such accounting policies and applied them
     consistently and made judgments and estimates that are reasonable and
     prudent so as to give a true and fair view of the state of affairs of the
     Company at the end of the financial year 2000-2001 and of the profit
                                                                                                                                               GAUTAM THAPAR
     of the Company for that period;
                                                                                                                                               S K KHANDELWAL
c)   The Directors have taken proper and sufficient care for the maintenance          Place : New Delhi                                          A K CHATTERJEE
     of adequate accounting records in accordance with the provisions of              Dated : 20th June, 2001                                            Directors




                                                                                 64
JANPATH INVESTMENTS AND HOLDINGS LIMITED


Auditors' Report
FOR THE YEAR ENDED 31ST MARCH, 2001

To the Members of                                                                       4.    The rates of interest where applicable and other terms and conditions
Janpath Investment & Holdings Ltd.                                                            of unsecured loans and advances in the nature of loans granted to
                                                                                              Companies, Firms or other parties listed in the register maintained
We report that we have audited the attached Balance Sheet of JANPATH
                                                                                              under section 301 of the Companies Act, 1956, and/or to Companies
INVESTMENTS AND HOLDINGS LTD. as at 31st March, 2001, and its
                                                                                              under the same management as defined under Sub-section (I-B) of
annexed Profit & Loss Account for the year ended on that date.
                                                                                              Section 370 of the Companies Act, 1956, are in our opinion, prima
In our opinion and to the best of our information and according to explanations               facie not prejudicial to the interest of the Company. However, in case of
given to us, the attached Balance Sheet and annexed Profit & Loss Account                     certain non-performing loans and advances in the nature of the loan,
subject to Note No. 7 in Schedule “K” regarding non-provision for diminution                  appropriate actions have been taken in respect thereof.
in the Book Value of Investments in a foreign joint venture subsidiary
                                                                                        5.    The parties to whom the loans or advances in the nature of loans have
company and read with other Notes appearing in Schedule ‘K’ give in the
                                                                                              been given by the Company are generally regular in repaying the principal
prescribed manner, the information required by the Companies Act, 1956,
                                                                                              amount and, are also regular in payment of interest wherever applicable.
and also give respectively a true and fair view of the state of affairs of
                                                                                              However, in case of certain non-performing loans and advances in the
the Company as at 31st March, 2001, and its profit for the year ended on
                                                                                              nature of loan, appropriate actions have been initiated in respect thereof .
that date.
                                                                                        6.    The Company has not accepted deposits from the Public.
We have obtained all the information and explanations which to the best of
our knowledge and belief were necessary for the purpose of our audit.                   7.    The Company has an Internal Audit System commensurate with the
                                                                                              size and nature of its business.
In our opinion, proper books of accounts as required by law have been kept by
the Company so far as appears from our examination of the books and the                 8.    There was no amount outstanding on 31st March, 2001, in respect of
above mentioned accounts are in agreement therewith.                                          undisputed Income Tax, Wealth Tax, Sales Tax, Custom Duty and
                                                                                              Excise Duty which were due for more than six months from the date
In our opinion, the Balance Sheet and the Profit & Loss comply with the
                                                                                              they became payable.
Accounting Standards referred to in Sub-section 3(C) of section 211 of the
Companies Act, 1956, except as stated above.                                            9.    During the course of our examination of the books of account carried
                                                                                              out in accordance with the generally accepted auditing practices we
On the basis of the written representations received from the Directors of
                                                                                              have not come across any personal expenses which have been charged
the Company as at 31st March, 2001, and taken on record by the Board of
                                                                                              to Profit & Loss Account except for those under contractual obligation
Directors, we report that no director is disqualified from being appointed as
                                                                                              or generally accepted practice of trade.
a Director of the Company under clause (g) of sub-section (1) of section 274
of the Companies Act, 1956.                                                             10.   Proper records have been maintained of the transactions and contracts
                                                                                              in respect of dealing in securities, shares and stocks etc. and timely
As required by the Manufacturing and other Companies (Auditor’s Report)
                                                                                              entries have been made therein. The investments of the Company are
Order, 1988, issued by the Central Government in terms of Section 227 (4A)
                                                                                              held in its own name except for a book value of Rs 1,16,83,200/- which
of the Companies Act, 1956, and on the basis of such checks of the books
                                                                                              are stated to be in the process of transfer and investments of Rs 11,70,000/
and records of the Company as we considered appropriate and according to
                                                                                              - which are exempt under the provisions of section 49 of the companies
the information and explanations given to us, we report that :-
                                                                                              act, 1956 (Refer para 12 under schedule “F” to the accounts)
1.     The Company has maintained proper records of its Fixed Assets showing
                                                                                        Other provision of Clause 4A and 4D of the Manufacturing and other
       full particulars including quantitative details and location thereof. The
                                                                                        Companies (Auditors’ Report) Order, 1988, are not applicable to the
       Fixed Assets have been physically verified by the Management and no
                                                                                        Company for this year.
       discrepancy was noticed.

2.     The Fixed Assets of the Company have not been revalued during
       the year.

3.     The Company has not taken any loans from the Companies, Firms
       or other parties listed in the Register maintained under Section 301
                                                                                                                                                For G. BASU & CO.
       of the Companies Act, 1956, and/or from Companies under the
                                                                                                                                                 Chartered Accountants
       same Management as defined under sub-section (I-B) of Section 370 of
       the Companies Act, 1956. However unsecured loan from the Holding
       Company by way of Optionally Convertible Bonds repayable at a premium,
       have been prematurely redeemed during the year on terms which are prima
       facie not prejudicial to the interest of the Company( Refer Note no. 3 in        Place : New Delhi                                              ANIL KUMAR
       Schedule “K” ) .                                                                 Dated : 20th June, 2001                                                  Partner


                                                                                   65
                                                                                    JANPATH INVESTMENTS AND HOLDINGS LIMITED


Balance Sheet
AS AT 31ST MARCH, 2001

                                                                                                           As at                                   As at
                                                                                                31st March, 2001                       31st March, 2000
                                                              SCHEDULE                           (Amount in Rs.)                          (Amount in Rs.)

SOURCES OF FUNDS

Shareholders’ Funds :
    (a) Capital                                                   "A"            789,892,000                             789,892,000
    (b) Reserves & Surplus                                        "B"             74,793,236        864,685,236          641,580,620      1,431,472,620

Loan Funds :
    Secured Loans                                                 "C"                               508,506,849                                       –
    Unsecured Loans                                               "D"                               484,301,400                           1,080,000,000

                                           TOTAL                                                   1,857,493,485                          2,511,472,620

APPLICATION OF FUNDS

Fixed Assets :                                                    "E"
    (a) Gross Block                                                              118,012,246                             107,866,913
        Less : Depreciation                                                       10,245,546                               7,789,803
        Net Block                                                                107,766,700                             100,077,110
    (b) Advance for purchase of land / property rights                           240,077,795                             181,177,795

                                                                                                    347,844,495                             281,254,905
Investments                                                       "F"                               865,818,606                           2,608,767,333

Current Assets, Loans & Advances :
    (a) Income accrued on Investments                                                 176,507                                 42,483
    (b) Sundry Debtors                                            "G"           1,317,504,012                              3,782,491
    (c) Cash & Bank Balances                                      "H"               7,769,882                              2,071,049
    (d) Loans & Advances                                           "I"            539,337,392                            665,710,790
                                                                             1,864,787,793                               671,606,813
Less : Current Liabilities & Provisions                            "J"       1,220,957,409                             1,050,156,431

Net Current Assets                                                                                  643,830,384                            (378,549,618)

Notes to Accounts                                                 "K"

                                           TOTAL                                                   1,857,493,485                           2,511,472,620



Schedules “A” to “K” referred to above form an integral part of the Balance Sheet




                                      As per our report of even date attached                                      For and on behalf of Board of Directors

                                                         For G. BASU & Co.
                                                         Chartered Accountants                                                      GAUTAM THAPAR
                                                                                                                                    S K KHANDELWAL
Place : New Delhi                                             ANIL KUMAR                                                              A K CHATTERJEE
Dated : 20th June, 2001                                              Partner                                                                  Directors



                                                                           66
JANPATH INVESTMENTS AND HOLDINGS LIMITED


Profit & Loss Account
FOR THE YEAR ENDED 31ST MARCH, 2001
                                                                                                        Year Ended                             Year Ended
                                                                                                  31st March, 2001                       31st March, 2000
                                                                 SCHEDULE                          (Amount in Rs.)                          (Amount in Rs.)
INCOME
Dividend , Interest on Debentures, Bonds
& Government Securities                                              “I”                                3,915,769                              25,567,989
Profit on sale of Investments (Net of loss)                                                           344,404,639                             123,373,585
(Includes gross receipt on transfer of rights to entitlements
of shares in the holding company amounting
to Rs. 30,93,99,964)
Other Income                                                         “II”                              17,387,801                               26,206,030
     TOTAL                                                                                            365,708,209                             175,147,604

EXPENDITURE
Administration & Miscellaneous expenses                              “III”                            255,863,490                             147,119,834
Interest Paid                                                        “IV”                              29,337,455                                         –
Obligation discharged to a Financial Institution                                                       15,650,000                                5,359,000
(Refer note 5 on Schedule "K")
Depreciation                                                                                             2,455,743                               2,530,142
Provision for doubtful debts                                                                             1,319,670
Amounts relating to investment business
vested from Ballarpur Industries Ltd. , in terms
of scheme of arrangement and reconstruction :
Provision for Substandard Loans & Advances                                           56,592,695                             49,407,785
Premium paid/payable on redemption of optionally
convertible bonds                                                                   113,400,000                            172,800,000
Provision for Diminution in book value of investments                               421,394,869                            516,242,419
                                                                                    591,387,564                            738,450,204
Less: Transfer from General Reserve                                                 591,387,564                 –          738,450,204                    –
      (refer note 4 on Schedule “K”)

     TOTAL                                                                                            304,626,358                             155,008,976

Profit /(Loss) before Taxation                                                                         61,081,851                               20,138,628
Provision for Income Tax                                                                                        –                                         –
Provision for Interest Tax                                                                                      –                                  120,000
Provision for Wealth Tax                                                                                   10,000                                         –


Profit /(Loss) after Taxation                                                                          61,071,851                               20,018,628
Balance brought forward from previous year                                                             20,018,628                                         –
Transfer to Reserve Fund (as per RBI Act, 1934)                                                        15,000,000                                         –
Dividend on Preference shares                                                                          33,095,890                                         –
Dividend Tax on above                                                                                    3,375,781                                        –
Balance carried over to the Balance Sheet                                                              29,618,808                               20,018,628
Note to Accounts                                                     "K"

Schedules “I” to “IV” referred to above form an integral part of the Profit & Loss Account.




                                         As per our report of even date attached                                     For and on behalf of Board of Directors

                                                            For G. BASU & Co.
                                                            Chartered Accountants                                                     GAUTAM THAPAR
                                                                                                                                      S K KHANDELWAL
Place : New Delhi                                                ANIL KUMAR                                                             A K CHATTERJEE
Dated : 20th June, 2001                                                 Partner                                                                 Directors



                                                                              67
                                                                                  JANPATH INVESTMENTS AND HOLDINGS LIMITED


Schedules “A” To “K”
ATTACHED TO AND FORMING PART OF THE BALANCE SHEET AS AT 31ST MARCH, 2001
                                                                                                          As at                               As at
                                                                                               31st March, 2001                   31st March, 2000
                                                                                                (Amount in Rs.)                      (Amount in Rs.)

SCHEDULE “A” : SHARE CAPITAL

AUTHORISED
   10,000 13.5% Redeemable Cumulative                                                                  100,000                             100,000
   Preference Shares of Rs.10/- each

    149,990,000 Equity Shares of Rs.10/- each                                                     1,499,900,000                     1,499,900,000

    40,000,000 5 % Redeemable Cumulative Preference                                                400,000,000                        400,000,000
    Shares of Rs.10/- each

                                                                                                  1,900,000,000                     1,900,000,000
ISSUED, SUBSCRIBED & PAID UP
    38,989,200 Equity Shares of Rs.10/- each fully paid up                                         389,892,000                        389,892,000

    40,000,000 5% Redeemable Cumulative Preference                                                 400,000,000                        400,000,000
    Shares of Rs.10/- each fully paid up
                                                                                                   789,892,000                        789,892,000

SCHEDULE “B” : RESERVES & SURPLUS

    General Reserve :
    As per last account                                                         621,555,992                       1,360,006,196
    Less : Transfer to Profit & Loss Account                                    591,387,564                        738,450,204
    (Refer note 4 on Schedule "K")
                                                                                                    30,168,428                        621,555,992
    Reserve Fund (as per RBI Act, 1934)                                                   –                                  –
    As per last account                                                                   –                                  –
    Add : for the year                                                           15,000,000         15,000,000               –                    –
    Profit & Loss Account                                                                           29,618,808                          20,018,628
    Capital Redemption Reserve                                                                           6,000                                6,000

                                                                                                    74,793,236                        641,580,620

SCHEDULE “C” : SECURED LOANS

    Short term loan from a Bank
    (From Deutche Bank at a interest rate of 11.5% p.a.                         500,000,000                                  –
    for max 56 days with final maturity on 2.04.01)
    Add: Interest accrued and due                                                 8,506,849        508,506,849               –                    –
    Note : Secured by pledge of Fixed Deposits held in the name of Bilt
    (Holding Co.) for INR 503.5 million.
                                                                                                   508,506,849                                    –



SCHEDULE “D” : UNSECURED LOANS

    Optionally convertible Redeemable Bonds                                    1,080,000,000                 –               –      1,080,000,000
    (Refer Note 3 on Schedule "K")
    Less : Redeemed during the year                                            1,080,000,000                 –               –                    –
    Short term loan from a company                                                                 484,301,400                                    –
    (From ASA Agencies Pvt. Ltd.)
                                                                                                   484,301,400                      1,080,000,000




                                                                          68
     SCHEDULE "E" FIXED ASSETS

     DESCRIPTION OF ASSETS                         GROSS BLOCK                          DEPRECIATION                                           NET BLOCK
                                         As at                 Disposal/    As at          Upto    For the       Disposals/      Upto          As at      As at
                                      01.04.2000    Additions Adjustment 31.03.2001     31.03.2000  Year        Adjustment    31.03.2001    31.03.2001 31.03.2000

     Land - Freehold                  52,004,420     8,605,000        –    60,609,420          –           –             –            –     60,609,420    52,004,420


     Building                         55,862,493            –         –    55,862,493   7,789,803   2,403,635            –    10,193,438    45,669,055    48,072,690


     Vehicles                                 –       150,968         –      150,968           –      27,305             –       27,305       123,663             –


     Furniture & Fixtures                     –      1,389,365        –     1,389,365          –       24,803            –       24,803      1,364,562            –
                                                                                                                                                                       JANPATH INVESTMENTS AND HOLDINGS LIMITED




     TOTAL                           107,866,913    10,145,333        –   118,012,246   7,789,803   2,455,743            –    10,245,546   107,766,700   100,077,110


     Advance for purchase of Land/




69
     Property rights                  181177795     58,900,000        –   240,077,795          –           –             –            –    240,077,795   181,177,795


     Total of Fixed Assets           289,044,708    69,045,333        –   358,090,041   7,789,803   2,455,743            –    10,245,546   347,844,495   281,254,905


     Previous Year                    267966269     21,078,439        –   289,044,708   5,259,661   2,530,142            –     7,789,803   281,254,905   262,706,608
                                                                                         JANPATH INVESTMENTS AND HOLDINGS LIMITED


SCHEDULE “F” INVESTMENTS
                                                            Balance             Purchases/Adjustments          Sales/Adjustments                  Balance as on
Particulars                                              As on 1.4.2000            during the period            during the period               31st March, 2001
                                                                                 1.4.00 to 31.03.2001          1.4.00 to 31.03.2001
                                                 Face Value/              Rs.   Face Value/          Rs.    Face Value/               Rs.   Face Value/            Rs.
                                                       Nos.                           Nos.                        Nos.                            Nos.

TRADE INVESTMENTS
LONG TERM

GOVERNMENT SECURITIES
3% Conversion Loan 1946-86
(Lodged as Security Deposit - Matured)              Rs.1000               801                                                                  Rs.1000             801
(See Note 1)
12-Year National Plan Savings Certificates          Rs.4000           4,000                                                                    Rs.4000          4,000
(Lodged as Security Deposit - Matured)
(See Note 1)
12-Year National Defence Certificates                 Rs.100              100                                                                    Rs.100            100
(Lodged as Security Deposit - Matured)
(See Note 1)
6 -Year National Savings Certificates              Rs.16500          16,500                                                                   Rs.16500        16,500
(Lodged as Security Deposit Rs.1751000)
(See Note 1)
5 -Year Kisan Vikas Patra                           Rs.1000           1,000                                                                    Rs.1000          1,000
(Lodged as Security Deposit)
(See Note 1)

SUBSIDIARY COMPANIES
Jg Containers (Malaysia) Sdn.Bhd.,
Fully paid Ordinary Shares of RM 1 each          10,859,010    175,590,000        1,082,421   12,500,000                                    11,941,431    188,090,000
The Pioneer Limited
Fully paid Equity Shares of Rs.10/- each         32,728,650                 –                                                               32,728,650              –
The Pioneer Limited
Fully paid up 15% Cumulative Redeemable             916,133                 –                                                                  916,133              –
Preference shares of Rs.100/-each

OTHER COMPANIES :
APR Limited
Fully paid up Equity Shares of Rs.10/- each      16,634,412     552,549,972              –              –   16,634,412    552,549,972                –              –
Karam Chand Thapar & Bros Limited
Fully paid up Equity Shares of Rs.10/- each          41,624         874,104                                                                     41,624       874,104
Nilkash Investments & Holdings Ltd.
Fully paid Equity Shares of Rs.10 each.            5,131,000                –                                                                 5,131,000             –
Nilkash Investments & Holdings Ltd.
Fully Paid 13.5% Redeemable Cumulative                  857           8,570                                                                        857          8,570
Preference Shares of Rs 10 each
Ailee Development Corporation Ltd., Seychelles
Fully paid Ordinary Shares of SR 1 each.         15,211,734                 –                                                               15,211,734              –
Arizona Printers & Packers Limited
Fully paid up Equity Shares of Rs.10/- each         234,600                 –                                                                  234,600              –
Asia Aviation Limited
Fully paid up Equity Shares of Rs.10/- each         760,000        7600000                                                                     760000        7600000
Ballarpur Glass Nigeria Ltd., Nigeria
Fully paid Ordinary Shares of Naira 1 each.       1,538,371                 –                                                                1,538,371              –
(See Note 10)
Ballarpur Palm Oil Sdn.Bhd., Malaysia
10% Redeemable Cum. Pref. Shares of M$ 1 each       800,000                 –                                                                  800,000              –
(See Note 10)
Ballarpur Palm Oil Sdn.Bhd., Malaysia
Fully paid Ordinary Shares of M$ 1 each.          2,400,000                 –                                                                2,400,000              –
(See Note 10)
BILT Middle East Pvt. Ltd., Dubai                       160      11,683,200                                                                        160     11,683,200
Fully paid class 'B' Shares of Dh 1000/- each
(See Note 10)
Best & Crompton Engg. Ltd
Fully paid up Equity Shares of Rs.10/- each              75               345                                                                       75             345
Bharat Starch Industries Ltd.
Fully paid Equity Shares of Rs.10 each.           3,500,000      61,600,000                                                                  3,500,000     61,600,000
(See Note 8 & 9)
Bharat Commerce & Industries Ltd.
Fully paid Equity Shares of Rs.10 each                8,000         112,000                                                                      8,000       112,000
Blue Horizon Investments Limited
Fully paid up Equity Shares of Rs.10/- each             510          34,170                                                                        510        34,170
Brake Linings Ltd.,
Fully paid Equity Shares of Rs.10 each                 7,725                –                                                                     7,725              –


                                                                                70
JANPATH INVESTMENTS AND HOLDINGS LIMITED


                                                              Balance             Purchases/Adjustments        Sales/Adjustments                  Balance as on
Particulars                                                As on 1.4.2000            during the period          during the period               31st March, 2001
                                                                                   1.4.00 to 31.03.2001        1.4.00 to 31.03.2001
                                                   Face Value/              Rs.   Face Value/         Rs.   Face Value/               Rs.   Face Value/            Rs.
                                                         Nos.                           Nos.                      Nos.                            Nos.

Crompton Greaves Limited
Fully paid up Equity Shares of Rs.10/- each           309,496      36,892,033                                                                  309,496     36,892,033
CEAT Limited
Fully paid up Equity Shares of Rs.10/- each               984          61,106                                                                      984        61,106
CG Newage Electricals Limited
Fully paid up Equity Shares of Rs.10/- each            50,000       6,150,000                                                                   50,000      6,150,000
CGPPI Adhesive Products Ltd
Fully paid up Equity Shares of Rs.10/- each            70,000         630,000                                                                   70,000       630,000
Deoria Sugar Mills Limited
Fully paid up Ordinary Shares of Rs.10/- each           9,500                –                                                                    9,500             –
(See Note 6)
Dhemo Main Colleries Ltd
Fully paid up Ordinary Shares of Rs.10/- each            2,000               –                                                                    2,000             –
(See Note 3)
Dr. Jai Singh’s Sons & Co. Ltd.
Fully paid Equity Shares of Rs.100 each                   500                –                                                                     500              –
(See Note 3)
East Chora Colleries Limited
Fully paid up Ordinary Shares of Rs.10/- each           6,500                –                                                                    6,500             –
(See Note 5)
English Indian Clays Limited
Fully paid up Equity Shares of Rs.10/- each         1,026,100      47,200,600                                                                1,026,100     47,200,600
Fidelia Constructions (P) Ltd
Fully paid up Equity Shares of Rs.100/- each           45,000                –                                                                  45,000              –
Global Green Company Ltd.
(Formerly Reitzel India Limited)
Fully paid up Equity Shares of Rs.10/- each          1,319,615      6,598,075       2475000     25063394                                     3,794,615     31,661,469
Global Green Company Ltd.
(Formerly Reitzel India Limited)
Fully paid up Preference Shares of Rs.100/- each                                        63000    6441046                                        63,000      6,441,046
Greaves Limited
Fully paid up Equity Shares of Rs.10/- each         7,893,439     410,458,828                                                                7,893,439    410,458,828
(See Note 8 )
HB Stockholdings Limited
Fully paid up Equity Shares of Rs.10/- each            41,580        2079000                                                                    41,580      2,079,000
HB Portfolio Limited
Fully paid up Equity Shares of Rs.10/- each            20,790        1039500                                                                    20,790      1,039,500
HB Estate Developers Ltd.
Fully paid up Equity Shares of Rs.10/- each            20,790       1,039,500                                                                   20,790      1,039,500
Haryana Oxygen Limited
Fully paid up Equity Shares of Rs.10/- each              2,500               –                                                                   2,500              –
Indian City Properties Ltd.
Fully paid Equity Shares of Rs.100 each.                2,000         888,000                                                                    2,000       888,000
Indian Chamber of Commerce
8% Mortgage Debentures of Rs.100 each.                  3-3/4                –                                                                   3-3/4              –
International Chemical Co., SAE, Egypt
Fully paid Equity shares of LE 1000 each                4,760      50,307,000                                                                    4,760     50,307,000
JCT Limited
Fully paid up Equity Shares of Rs.10/- each         8,703,564      88,776,353                                                                8,703,564     88,776,353
(See Note 8 & 9)
JCT Electronics Limited
Fully paid up Equity Shares of Rs.10/- each           150,000       1,890,000                                                                  150,000      1,890,000
Jackson Marine (India) Limited
Fully paid up Equity Shares of Rs.100/- each            1,500                –                                                                   1,500              –
Janta Sahakari Bank Limited,
Fully paid Equity Shares of Rs.100 each                    51                –                                                                      51              –
Jay Engineering Works Ltd.
Fully paid 10% Redeemable Cumulative
Preference Shares of Rs.100 each.                         168           1,680                                                                      168          1,680
Jay Engineering Works Ltd.
Fully paid Equity Shares of Rs.10 each.                 6,630                –                                                                    6,630             –
Jg Moulds Limited
Fully paid Equity shares of Rs.100 each                   200                –                                                                     200              –
Karam Chand Thapar & Bros (Coal Sales) Ltd
Fully paid up Ordinary Shares of Rs.100/- each         26,376    541,077,360               69     539262                                        26,445    541,616,622
Karam Chand Thapar (Africa) Ltd.,
Fully paid Equity Shares of 1 US $ each               100,000       3,587,600                                                                  100,000      3,587,600



                                                                                   71
                                                                                         JANPATH INVESTMENTS AND HOLDINGS LIMITED


                                                            Balance             Purchases/Adjustments          Sales/Adjustments                  Balance as on
Particulars                                              As on 1.4.2000            during the period            during the period               31st March, 2001
                                                                                 1.4.00 to 31.03.2001          1.4.00 to 31.03.2001
                                                 Face Value/              Rs.   Face Value/         Rs.     Face Value/               Rs.   Face Value/            Rs.
                                                       Nos.                           Nos.                        Nos.                            Nos.

Kashmir Tankers Limited
Fully paid up Equity Shares of Rs.10/- each          15,000                –                                                                    15,000              –
Karanpura Colleries Limited
Fully paid up Equity Shares of Rs.10/- each           3,750                –                                                                     3,750              –
Lazard Credit Capital Limited
Fully paid up Equity Shares of Rs.10/- each         150,000       1,800,000                                                                    150,000      1,800,000
Modern Agencies Ltd.
Fully paid Ordinary Shares of Rs.100 each.            6,037      11,530,670                                                                      6,037     11,530,670
New Savan Sugar & Gur Refining Co. Ltd
Fully paid up Equity Shares of Rs.10/- each           6,934          48,538                                                                      6,934        48,538
(See Note 7)
Orient Engineering & Commercial Co. Ltd
Fully paid up Equity Shares of Rs.100/- each            915       2,123,715                                                                        915      2,123,715
Oriental Coal Co. Ltd
Fully paid up Equity Shares of Rs.10/- each          89,877         539,262                                     89,877        539,262                –              –
(See Note 4)
Phoenix Pulp & Paper Company Ltd., Thailand.
Fully paid Equity Shares of Thai Baht 10 each    27,223,899    1,068,946,788             –              –   27,223,899 1,068,946,788                 –              –
( Refer Note 11)
Phoenix Pulp & Paper Company Ltd., Thailand.
Fully paid 10% Cumulative redeemable
preference share of Thai Baht 10 each             2,751,970     118,327,885              –              –                                    2,751,970    118,327,885
 .
P T. Saraswati Bhakti Coated Papers, Indonesia
Fully paid Equity Shares of US $ 10 each.           237,650                –                                                                   237,650              –
(See Note 10)
Philips India Limited
Fully paid up Equity Shares of Rs.10/- each             459          40,851                                                                        459        40,851
Pfizer Limited,
Fully paid Equity shares of Rs.10 each                  642         155,557                                                                        642       155,557
Rama Fibres Limited
Fully paid up Ordinary Shares of Rs.10/- each        65,000                –                                                                    65,000              –
Sarasvati Travels Pvt. Ltd
Fully paid up Equity Shares of Rs.10/- each              30                –                                                                        30              –
Shree Sitaram Sugar Co. Ltd
Fully paid up Ordinary Shares of Rs.10/- each        15,200                –                                                                    15,200              –
(See Note 6)
Standard Refinery & Distillery Limited
Fully paid up Ordinary Shares of Rs.10/- each        13,905                –                                                                    13,905              –
SRF Limited
Fully paid up Equity Shares of Rs.10/- each           1,000          31,100                                                                      1,000        31,100
Super Bazar Cooperative Stores Ltd.
Fully paid Equity shares of Rs.10 each                  500                –                                                                       500              –
(See Note 3)
Teg’s Masarado Ltd.
Fully paid Equity Shares of Rs.100 each              20,000                –                                                                    20,000              –
Thapar Consultants & Services Ltd.,
Fully paid Equity Shares of Rs.10 each                1,000                –                                                                     1,000              –
(See Note 2)
The Scindia Steam Navigation Co. Ltd
Fully paid up Ordinary Shares of Rs.20/- each            20               52                                                                        20             52
Andhra Pradesh Paper Mills Ltd.                                                        100        6194                                             100          6,194
Fully paid Equity Shares of Rs.10 each
ITC Bhadrachalam Paperboards Ltd.                                                      100        6481                                             100          6,481
Fully paid Equity Shares of Rs.10 each
Orient Paper & Industries Ltd.                                                         100        2415                                             100          2,415
Fully paid Equity Shares of Rs.10 each
Tamilnadu Newsprint & Papers Ltd.                                                      100        4042                                             100          4,042
Fully paid Equity Shares of Rs.10 each
West Coast Paper Mills Ltd.                                                            100        5839                                             100          5,839
Fully paid Equity Shares of Rs.10 each
Seshasayee Paper & Boards Ltd.                                                         100        2198                                             100          2,198
Fully paid Equity Shares of Rs.10 each
Sirpur Paper Mills Ltd.                                                                100        3540                                             100          3,540
Fully paid Equity Shares of Rs.10 each
Star Paper Mills Ltd.                                                                  100        1163                                             100          1,163
Fully paid Equity Shares of Rs.10 each




                                                                                72
JANPATH INVESTMENTS AND HOLDINGS LIMITED


                                                                           Balance                 Purchases/Adjustments                      Sales/Adjustments                      Balance as on
Particulars                                                             As on 1.4.2000                during the period                        during the period                   31st March, 2001
                                                                                                    1.4.00 to 31.03.2001                      1.4.00 to 31.03.2001
                                                              Face Value/                   Rs.     Face Value/                Rs.         Face Value/               Rs.      Face Value/                 Rs.
                                                                    Nos.                                  Nos.                                   Nos.                               Nos.

Balkrishna Industries Ltd.                                                                                   100            2980                                                       100             2,980
Fully paid Equity Shares of Rs.10 each
Century Pulp Mills Ltd.                                                                                      100            6358                                                       100             6,358
Fully paid Equity Shares of Rs.10 each
Pudumjee Pulp & Paper Mills Ltd.                                                                             100            2046                                                       100             2,046
Fully paid Equity Shares of Rs.10 each
Rohit Pulp & Paper Mills Ltd.                                                                                100            1118                                                       100             1,118
Fully paid Equity Shares of Rs.10 each
Rollatainers Ltd.                                                                                            100            1415                                                       100             1,415
Fully paid Equity Shares of Rs.10 each
Rama Newsprint and Papers Ltd.                                                                               100              715                                                      100               715
Fully paid Equity Shares of Rs.10 each
Toscana Nepal Pvt. Ltd.
Fully paid Equity Shares of Nepali Rs.100 each                    175,000                     –                                                                                   175,000                   –
(See Note 10)
Varun Prakashan (P) Limited
Fully paid up Equity Shares of Rs.100/- each                         8,500                    –                                                                                      8,500                  –
Bilt Investments Limited
Fully paid up Equity Shares of Rs.10/- each                       139,720           1,397,200         3,000,000      30,000,000             3,139,720      31,397,200                     –                 –
Bilt Investments Limited
Fully paid up Preference Shares of Rs.100/- each                                                      2,000,000 600,000,000                 2,000,000     600,000,000                     –                 –

                                                                               3,213,693,015                        674,590,206                          2,253,433,222                        1,634,849,998

Provision for diminution in book value                                            604925682                                                                                                     769031392

Total after provision                                                          2,608,767,333                                                                                                   865,818,606




                                                   AS AT 31ST MARCH, 2001                 AS AT 31ST MARCH, 2000
Government Securities                                               22,401                                22,401
Fully paid up Preference Shares                              124,699,615                           118,258,570
Fully paid up Equity Shares                                  741,096,590                          2,490,486,362
Debentures                                                                –                                     –
Fully paid up Warrants                                                    –                                     –

                                                             865,818,606                          2,608,767,333



                                                                 AS AT 31ST MARCH, 2001                                     AS AT 31ST MARCH, 2000
                                                               Book Value                   Market Value                   Book Value                     Market Value
                                                                        Rs.                            Rs.                           Rs.                             Rs.
Officially Quoted                                            652,380,141                   265,097,946                1,215,548,032                      265,111,427
Unquoted                                                     982,447,456                                               1,998,122,582
Government Securities                                               22,401                                                     22,401

                                                           1,634,849,998                                              3,213,693,015



NOTES
1.   Investments in Government Securities namely - 3% Conversion Loan, 12 year National Plan Savings Certificates, 12 year National Defence Certificates, 6 year National Savings Certificates and 5 year
     Kisan Vikas Patra aggregating to a book value of Rs 22,600/- , vested in terms of the scheme of arrangement and reconstruction, were lodged by Ballarpur Industries Ltd. with various agencies as security
     deposit. The confirmation as regards lodgement is not available from the respective agencies.
2.   Thapar Consultants & Services Limited has applied for strike-off of its name from the Records of the Registrar of the Companies, Kolkata, as its networth has been completely eroded and no business
     was being done.
3.   Share Certificates in respect of investments in Dhemo Main Colleries Ltd., Dr. Jai Singh’s Sons & Co. Ltd. (company under liquidation) and Super Bazar Co-operative Stores Ltd. are not available
     physically.
4.   During the year, Oriental Coal Company Ltd. (OCCL) has been amalgamated with Karam Chand Thapar & Bros. ( Coal Sales ) Limited as per order of the Hon'ble High Court of Calcutta with
     effect from 1.04.1999. KCT (CS) Ltd. has issued 69 ordinary share of Rs 100/- each fully paid against 89877 equity share of Rs 10/- each in OCCL . Consequent upon this, Necessary adjustments
     have been effected in the books.
5.   The ownership of the non-coking mines of East Chora Colliery Co. Ltd. ( ECCCL ) vested in the Central Government with effect from 1st May, 1973 by virtue of Coal Mines (Nationalisation) Act,
     1973.
     The ECCCL had filed a suit in Calcutta High Court in respect of its claims which is pending as on 31.03.2001.
6.   The above investments include 9500 ordinary shares of Rs.10/- each fully paid up and 15200 ordinary shares of Rs.10/- each fully paid up respectively in Deoria Sugar Mills Ltd. and Shree Sitaram
                                                                                                          .                                        .
     Sugar Co. Ltd. , the undertakings of which with effect from 24th April, 1989, stood vested in the U.P State Sugar Corporation by virtue of U.P Government ordinance dt. 21st April, 1989, issued
                             .
     under provisions of U.P Sugar Undertaking (Acquisition) Act, 1971.



                                                                                                     73
                                                                                                                 JANPATH INVESTMENTS AND HOLDINGS LIMITED

7.   The above investments include 6934 ordinary shares of Rs.10/- each fully paid up in New Savan Sugar & Gur refining Co. Ltd., the undertaking of which stood vested in and transferred to the
     Government of Bihar with effect from 7th January, 1979, under the Bihar Sugar Undertakings (Acquisition) Act, 1976.
8.   Investments held in the name of the Company (with an exception*) in following scrips of the book value of Rs 46,00,10,023/- ( Previous year Rs 96,08,35,683 ) are pledged with financial institutions
     / banks against loans taken by undernoted companies :-

       Name of the Scrip                     No. of Shares Loans taken by                           Book Value     Pledged with
                                                      Nos.                                                 Rs.




                                                                                                                                                                        }
       Bharat Starch Industries Ltd.            3,500,000 English Indian Clays Ltd.                61,600,000      ICICI Ltd.
       Greaves Limited                              22,500 Ballarpur Industries Ltd.                1,170,000      Allahabad Bank ( Railway credit facility)*
                                                2,056,079 Bilt Chemicals Ltd.                    106,916,108       ICICI Ltd.                                               Investments held in the name of
                                                                                                                                                                            Allahabad Bank Nominees.
                                                5,397,420 JCT Electronics Ltd.                   280,665,840       ICICI Ltd.
       Global Green Company Ltd.                1,319,615 Global Green Co. Ltd.                     6,598,075      ICICI Ltd.
       JCT Limited                                 300,000 Ballarpur Industries Ltd.                3,060,000      Industrial Development Bank of India

9.   Non-disposal undertaking in respect of following Scrips were given by Ballarpur Industries Ltd. to financial institution/ Banks in connection with financial assistance granted by them to other Companies
     until their repayment obligations are discharged, remained outstanding as on 31.03.2001

     Name of the Scrip                       No. of Shares Beneficiaries                            Book value     Undertaking given in favour of

     Bharat Starch Industries Ltd.              3,500,000 English Indian Clays Ltd.               61,600,000       AE Stanely Manufacturing Co. Ltd., USA
     JCT Ltd.                                   8,193,564 JCT Ltd.                                83,574,353       IFCI and IRBI

10. Investments in Foreign Joint Ventures, vested from Ballarpur Industries Ltd. in terms of the scheme of arrangement and reconstruction has since been transferred in the name of Janpath
    Investments & Holdings Ltd. except in case of following companies :-

     Name of the Foreign Joint Venture (JV )                              No. of Shares                                                                  Status

     Ailee Development Corporation Ltd., Seychelles                           15211734        Transfer of shares in the name of JIHL is in process
     Bilt Middle East Pvt. Ltd., Dubai                                               160      Ballarpur Industries Ltd. (Holding Company) has made an application to the Reserve Bank of India (RBI)
                                                                                              to approve reduction of our earlier holding of 241 equity shares to that of 160 equity shares (as per
                                                                                              records of the JV Company) for which approval is awaited.
     Ballarpur Glass Nigeria Ltd., Nigeria                                      1538371        The JV Company was under receivership, from which we have received remittance towards our prorated
                                                                                               share of sale proceeds. The Company has applied to the RBI for write-off of investments from books.
      .
     P T. Saraswati Bhakti Coated Papers, Indonesia                              237650        The applications had been made by BILT to the RBI for writing-off of the investments in view of closure of
                                                                                               projects for which approval is pending.
     Toscana Nepal Pvt. Ltd., Nepal                                              175000        The JV Company had closed down its operations since April, '96 and is in the process of settling lenders
                                                                                               dues and further considering, subject to necessary approval, for liquidation of the JV Company.
     Ballarpur Palm Oil, Sdn. Bhd              Ordinary Shares                  2400000        The JV Company is under liquidation. RBI had given its approval for the write-off, accordingly the
                                               Preference Shares                 800000        same is stated in the books at zero value.



11. The Company has entered into agreements on 27th and 28th November, 2000 with foreign parties for sale of entire lot of 2,72,23,899 Equity Shares of Phoenix Pulp & Paper Company Ltd.,
    Thailand. Pending receipt of sale consideration, the shares have been kept with Standard Chartered Bank, Thailand, under custody account. The Company has obtained necessary approvals from
    the Reserve Bank of India for extension of time for repatriation of sale proceeds to India . Adjustments for sale of investments have been made in these accounts at the closing exchange rates.
12. Shares, securities, debentures and other investments have been held by the Company in its own name except for investments of the book value of Rs.1,28,53,200/- ( Previous year
    Rs.106,03,96,081/- ) which are in the process of transfer are covered by the exemption granted under section 49 of the Companies Act, 1956.




                                                                                                     74
JANPATH INVESTMENTS AND HOLDINGS LIMITED

                                                                                                     As at                             As at
                                                                                          31st March, 2001                 31st March, 2000
                                                                                           (Amount in Rs.)                    (Amount in Rs.)

SCHEDULE “G” – SUNDRY DEBTORS
Debts outstandings for a period exceeding six months
Unsecured considered good                                                                        2,462,821                                 –
Unsecured, considered doubtful                                                1,319,670                 –
Less: Provision for doubtful debts                                            1,319,670                 –             –                    –
Other Debts                                                                                  1,315,041,191                        3,782,491
(Includes consideration due from foreign parties against disposal of
Equity Shares in Phoenix Pulp & Paper Company Ltd., Thailand -
amount to Rs 131,27,13,370 Refer Note 11 on Schedule “F” )
                                                                                             1,317,504,012                        3,782,491


SCHEDULE “H” – CASH & BANK BALANCES
Cash in Hand                                                                                      216,880                           183,006
Balance with Scheduled Banks :
In Current Account                                                                               2,287,699                        1,888,043
In Fixed Deposit Account                                                                        5,045,303                                  –
In Margin Money Account                                                                           220,000
                                                                                                 7,769,882                        2,071,049


SCHEDULE “I” – LOANS & ADVANCES
Loans
Unsecured considered good
To Subsidiary Companies                                                     156,802,849                      161,802,849
To other Companies                                                          184,778,126                      193,056,510
                                                                            341,580,975                      354,859,359
Less : Provision for non-performing assets as per
       prudential norms for Non-Banking Financial Company                    93,690,855       247,890,120     55,745,792       299,113,567
Advances
Unsecured considered good
To Subsidiary Companies                                                      33,242,257                       33,032,783
To other Companies                                                          248,523,850                      316,259,270
Advances recoverable in cash or kind or for                                  57,724,091                       47,406,150
value to be received
                                                                            339,490,198                      396,698,203
Less : Provision for non-performing assets as per
       prudential norms for Non-Banking Financial Company                    62,533,234       276,956,964     43,885,601       352,812,602
Unsecured, Considered doubtful                                                       –                                –
Less : Provision for doubtful advances                                               –                  –             –                    –
Income Tax deducted at Source                                                14,140,908                       12,493,766
Interest Tax refund receivable                                                       –                           419,230
Advance Interest Tax                                                           349,400                           328,000
Advance Wealth Tax ( A.Y. 1998-99 )                                                  –         14,490,308        543,625         13,784,621
                                                                                              539,337,392                      665,710,790




                                                                       75
                                                                                          JANPATH INVESTMENTS AND HOLDINGS LIMITED

                                                                                                                    As at                                      As at
                                                                                                         31st March, 2001                          31st March, 2000
                                                                                                          (Amount in Rs.)                             (Amount in Rs.)

SCHEDULE “J” – CURRENT LIABILITIES & PROVISIONS
Current Liabilities :
Sundry Creditors :
–      Due to holding Company                                                         1,104,503,394                                506,187,227
–      Others                                                                            69,096,861        1,173,600,255              7,826,583         514,013,810
Security Deposits                                                                                               5,955,145                                11,739,385
Advances received                                                                                                 696,019                                 1,235,292
Provisions :
Income Tax                                                                                3,534,609                                  3,534,609
Proposed Dividend (On Preference Shares)                                                 33,095,890                                            –
Tax on proposed dividend                                                                   3,375,781                                           –
Interest Tax                                                                                 533,335                                   533,335
Wealth Tax                                                                                   166,375                                   700,000
Premium on redemption of Convertible Bonds                                                           –        40,705,990           518,400,000          523,167,944

                                                                                                            1,220,957,409                            1,050,156,431

Note : All outstanding dues of creditors are other than that of small scale undertaking.
SCHEDULE “K” – NOTES TO ACCOUNTS
1.     The entire Share Capital is held by Ballarpur Industries Limited , the Holding Company and its nominees.
2.     5% Redeemable Cumulative Preference Shares are redeemable on or before 5th August, 2006, in terms of provisions of Section 80A of the Companies
       Act, 1956. Out of the arrears of dividend on the aforesaid preference shares from the period 5th August, 1996, to 31st March, 2001, it is proposed to
       pay arrears of dividend upto 31.03.1998, amounting to Rs. 3,30,95,890/- . Accordingly the same has been provided in the books. The arrears of dividend
       from 1.04.1998 to 31.03.2001, amounts to Rs. 6,00,00,000/- (Previous year Rs.7,30,95,890/-).
3.     During the year, the Company has redeemed the entire lot of Rs. 108 Crore Optionally Convertible Bonds (Including Rs. 75.60 crore Prematurely
       redeemed,) and has also paid Rs. 63.18 crores towards premium due up to 31.03.2001 on these bonds to its holding company Ballarpur Industries Ltd.
       The residual premium amounting to Rs. 13.50 crores, payable as per original terms and conditions on the aforesaid Bonds have been waived off in
       consideration of premature redemption.
4.     During the financial year 1998-99, General Reserve of Rs. 244.38 crores was created as a result of vesting of investment businesses of Ballarpur Industries
       Limited to this company, in terms of the Scheme of Arrangement and Reconstruction effective from 1.04.1997. For such investment businesses, the
       Company is required to make provisions during the year for non-performing assets, diminution in the value of investments and, premium payable on
       optionally convertible Bonds aggregating to Rs. 59.14 crores (Previous year Rs. 73.85 crores) in the Profit & Loss account and therefore as in the previous
       year, the Company has withdrawn equivalent amount from General Reserve to the Profit & Loss account to offset the impact of such provisions.
5.     During the year, the Company has paid Rs. 156.50 lacs as a one time settlement to The State Bank of India (Previous year to Orrisa State Financial
       Corporation Rs 53.59 lacs) on behalf of Krebs & Cie (India) Ltd., a company declared sick under BIFR in terms of our guarantee obligation as a promoter.
       The aforesaid amount has been written off in these accounts
6.     The Company has entered into agreements on 27th and 28th November, 2000, with foreign parties for sale of 2,72,23,899 equity shares of Phoenix Pulp
       & Paper Company Ltd., Thailand. Pending receipt of sale consideration, the shares have been kept with Standard Chartered Bank, Thailand, under
       custody account. The Company has obtained necessary approvals from the Reserve Bank of India including for extension of time for repatriation of sale
       proceeds to India. Adjustments for the sale of investments have been made in these accounts at the closing exchange rates.
7.     The net worth of Jg. Containers., Malaysia, a foreign joint venture and a subsidiary of the Company, has eroded as at the end of its financial year
       31.12.2000. However, in view of JV’s ongoing expansion / proposed rehabilitation plan, no provision has been made for the fall in the value of investments.
8.     Contingent Liabilities :
       Guarantees given by holding Company - Ballarpur Industries Limited vested in Janpath Investments and Holdings Limited in terms of the Scheme of
       Arrangement and Reconstruction to financial institutions / banks in respect of financial assistance given for investment business of the Company. Amount not
       ascertainable.
9.     (a).     Earning in foreign exchange :
                i.      Dividend from foreign Company - Rs. NIL (Previous year Rs. 12,51,055.82 from Bilt Middle East LLC, Dubai)
                ii.     Realisation against investments on liquidation of foreign joint venture - Rs. NIL (Previous year Rs. 14,66,811.75 from Ballarpur Glass Nigeria)
                iii.    On sale of Investments of Phoenix Pulp & Paper Co. Ltd., (PPCL) Thailand - Rs. 131,27,13,370/- (Previous year Rs 23,30,55,886/-) - Refer
                        Note 6 above.
                 iv.    Realisation on sale of Investments - Rs. NIL (Previous year Rs. 15,63,12,000/- of Maersk India Ltd.))




                                                                                 76
JANPATH INVESTMENTS AND HOLDINGS LIMITED

      (b).         Expenditure in foreign exchange :
                   i.    Purchase of Investments in a foreign company - Rs. 1,25,00,000/- Jg. Container, Malaysia (Previous year Rs. 75,65,84,908/- in PPCL,
                         Thailand)
                   ii.   Payment for custodian fee to a Bank - Rs. 46,610/- For PPCL shares to Standard Chartered Bank, Thailand (Previous year Rs NIL)
10.   Rental income comprises of Rs. 15,00,000/- from own property and balance is from sub-letted property upto the period of agreement.
11.   Under an agreement with the holding Company Ballarpur Industries Limited, cost of handling the business activities of the Company are primarily
      incurred by the holding Company which is reimbursed to them as corporate service expenses.
12.   Investments and other assets including Building as received from holding Company, Ballarpur Industries Limited under the approved scheme of
      Arrangement and Reconstruction as well as Company’s own fixed assets and investments ( that were acquired prior to 1.04.1997 ) are stated at revalued
      cost as of 1.04.1997 as per the revaluation done by the approved valuers as a part of the above referred scheme.
13.   Figures for the previous year have been re-arranged and regrouped wherever necessary to conform to current year’s classification.
14.   SIGNIFICANT ACCOUNTING POLICIES
      A.     Basis for preparation of financial statements
             The financial statements have been prepared under the historical cost convention in accordance with the Generally Accepted Accounting Principles,
             the provisions of the Companies Act, 1956, and materially comply with the accounting standards issued by the Institute of Chartered Accountants
             of India.
      B.     Revenue Recognition
             i.          Income and expenditure are accounted on accrual basis in accordance with the requirement of the Companies Act, 1956 except in the case
                         of interest on Non-performing Assets, which is recognised on realisation basis as per the Reserve Bank of India NBFC guidelines.
             ii.         Dividend income is accounted for when the same is declared in the shareholder’s meeting.
      C.     Investments
             i.          The Company’s investments, in pursuance of its objects, is meant to be held for long term and as such are valued at cost / assessed value as
                         of 1.04.1997.
             Provision for diminution in the book value of long term investments is made only if, such a decline is considered other than temporary.
             ii.         Investment in Government Securities are shown at cost.
             iii.        Profit / Loss on sale of investments is determined on the basis of their average cost.
      D.     Fixed Assets
             i.          Fixed assets are stated at cost of acquisition and other related expenditure/ assessed value as of 1.04.1997.
             ii.         Depreciation on fixed assets is provided on written down value method, at the rates prescribed under schedule XIV of the Companies Act,
                         1956.
      E.     Write-off of Bad Debts
             i.          Specific loans / debts which in the opinion of the management of the Company based on present available information, are considered fully
                         or partially irrecoverable are written off. Amounts recovered against debts written off in the past are credited to revenue account.
             ii.         In addition, the Company creates a provision for doubtful loans and advances in accordance with the income recognition and provisioning
                         requirements of Non-Banking Financial Companies ( Prudential Norms ) Directions, 1998 issued by the Reserve Bank of India.
      F.     Foreign Exchange Transactions
             Transactions relating to purchase and sale of investments and dividend income from foreign companies are recorded at the rates prevailing on the
             date of transactions.
             Loss or gains arising out of such transactions are adjusted in the profit and loss account.
             However, in case of sale of an investment in a foreign joint venture company sold during the year, pending receipt of sale consideration, the profit
             on sale of investments have been recorded on the basis of rate of exchange prevailing on the close of the accounting year, i.e. 31.03.2001.




                                                                                     77
                                                                                                JANPATH INVESTMENTS AND HOLDINGS LIMITED


15. BALANCE SHEET ABSTRACT AND GENERAL BUSINESS PROFILE


I.     REGISTRATION DETAILS :

       Registration No. :                 1   1   -   1    2     7     0   2       9                State Code :   1 1

       Balance Sheet Date :                       3   1          0     3       2       0    0   1
                                                  Date           Month                  Year

II.    CAPITAL RAISED DURING THE YEAR: (Amount in Rs. Thousand)

       Public Issue :                             N   I    L                       Rights Issue :                            N    I   L

       Bonus Issue :                              N   I    L                       Private Placement :                       N    I   L

III.   POSITION OF MOBILISATION AND DEPLOYMENT OF FUNDS: (Amount in Rs. Thousand)

       Total Liabilities :                    1   8   5    7     4     9   3       Total Assets :                        1   8    5   7   4   9   3

       SOURCES OF FUNDS :

       Paid-Up Capital :                          7   8    9     8     9   2       Reserves & Surplus :                           7   4   7   9   3

       Secured Loans :                            5   0    8     5     0   7       Unsecured Loans :                         4    8   4   3   0   1

       APPLICATION OF FUNDS :

       Net Fixed Assets :                         3   4    7     8     4   4       Investments :                             8    6   5   8   1   9

       Net Current Assets :                       6   4    3     8     3   0       Misc. Expenditure :                       N    I   L

       Accumulated Losses :                       N   I    L

IV.    PERFORMANCE OF COMPANY : (Amount in Rs. '000)

       Total Income                               3   6    5     7     0   8       Total Expenditure :                       3    0   4   6   2   6

       Profit before Tax :                            6    1     0     8   2       Profit after Tax :                             6   1   0   7   2

       Earning Per Share (in Rs.)                          1      .    0   5       Dividend Rate (%) :                       N    I   L

V.     GENERIC NAMES OF THE THREE PRINCIPAL PRODUCTS/SERVICES OF THE COMPANY :


       Product
       Item Code No. (ITC Code)
       Product Description
                                     }    Not Applicable



       Type of Business:

The Company is an Investment Company whose principal business is dealing / acquisition in stocks and shares.

                                                                 Signatures to Schedules “A” to “K”




                                         As per our report of even date attached                                         For and on behalf of Board of Directors

                                                               For G. BASU & Co.
                                                               Chartered Accountants                                                      GAUTAM THAPAR
                                                                                                                                          S K KHANDELWAL
Place : New Delhi                                                     ANIL KUMAR                                                            A K CHATTERJEE
Dated : 20th June, 2001                                                      Partner                                                                Directors




                                                                                       78
JANPATH INVESTMENTS AND HOLDINGS LIMITED


Schedule “I” To “IV”
ATTACHED TO AND FORMING PART OF THE PROFIT & LOSS ACCOUNT FOR THE YEAR ENDED 31ST MARCH, 2001
                                                                                                            Year ended                              Year ended
                                                                                                      31st March, 2001                        31st March, 2000
                                                                                                       (Amount in Rs.)                           (Amount in Rs.)


SCHEDULE “I” : DIVIDEND, INTEREST ON DEBENTURES,
BONDS & GOVERNMENT SECURITIES
Dividend                                                                                                     3,915,739                              25,463,132
Interest on Debentures & Bonds - Gross                                                                             30                                  104,857
(Tax deducted /deductible at source Rs. 7/-,
Previous year Rs.17,163/-)
                                                                                                             3,915,769                              25,567,989

SCHEDULE “II” : OTHER INCOME
Interest on Loans - Gross                                                                                    5,915,087                               8,774,457
(Tax deducted at source Rs. Nil under exemption certificate )
Interest on Fixed Deposits - Gross                                                                            256,378                                  236,920
(Tax deducted at source Rs. 48,255/-, Previous Year Rs. 52,123/-)
Other Interest - Gross                                                                                        407,182                                   78,528
(On Income Tax Refund)
Rental Income (net of rent paid)                                                                             8,425,143                              13,212,906
(Tax deducted/deductible at source Rs. 15,98,838/-, Previous year Rs. 75,21,187/-)
Commission on pledging of Shares                                                                             2,327,821                               3,647,491
Miscellaneous Income                                                                                           56,190                                  255,728
                                                                                                           17,387,801                               26,206,030

SCHEDULE “III” : ADMINISTRATION
& MISCELLANEOUS EXPENSES
Office & other expenses                                                                                      1,233,166                                 600.861
Rates & Taxes                                                                                                  26,592                                   26,592
Corporate Services expenses reimbursed to Holding Company                                                 247,108,238                             135,602,750
(Refer note 11 on schedule “K”)
Consultancy fees                                                                                             6,092,848                               8,113,993
Staff House expenses                                                                                         1,325,027                                 689,709
Land development expenses                                                                                           –                                1,017,509
Insurance Charges                                                                                              53,419                                         –
Balance Written Off                                                                                                 –                                1,026,645
Directors Meeting Fee                                                                                           2,200                                     1,400
Payment to Auditors
    – Audit fee                                                                             20,000                                   20,000
    – Tax Audit fee                                                                          2,000                                    2,000
    – In other Capacity                                                                          –             22,000                18,375             40,375

                                                                                                          255,863,490                             147,119,834

SCHEDULE “IV” : INTEREST PAID
To Holding Company                                                                                         29,337,455                                         –
To Others - On Cash credit facility from Banks                                                             29,337,455                                         –


                                                                Signatures to Schedules “I” to “IV”


                                       As per our report of even date attached                                           For and on behalf of Board of Directors

                                                          For G. BASU & Co.
                                                          Chartered Accountants                                                           GAUTAM THAPAR
                                                                                                                                          S K KHANDELWAL
Place : New Delhi                                                 ANIL KUMAR                                                                A K CHATTERJEE
Dated : 20th June, 2001                                                  Partner                                                                    Directors



                                                                                79
                                                                        JANPATH INVESTMENTS AND HOLDINGS LIMITED


Statement Regarding Subsidiary Companies Pursuant to Section 212 of the Companies Act, 1956

1.   Name of Subsidiary                         The Pioneer Limited                    JG Containers (Malaysia) SDN. BHD.

2.   Holding Company's Interest                 Holders of 3,27,28,650 Equity Shares   Holders of 1,19,41,431 ordinary Shares of
                                                of Rs. 10 each out of the Subscribed   RM 1/- each out of subscribed capital of
                                                Capital of 3,29,98,640 Equity Shares   1,83,88,111 Ordinary Shares.
                                                of Rs. 10 each

3.   Net aggregate amount of Subsidiaries'
     profit less losses and not dealt within
     the Company's Accounts

     (I)   For the subsidiaries' financial      Rs. 2,43,46,194                        Rs. 2,20,66,736
           year ended 31st March, 2001          (Loss)                                 (Loss)

     (II) For the previous financial year       Rs. 4,91,68,474                        Rs. 3,53,51,137*
          since it became subsidiary.           (Loss)                                 (Loss)

4.   Net aggregate amount of subsidiaries's
     profits less losses and dealt within the
     Company's Accounts.

     (I)   For Subsidiaries financial year      Nil                                    Nil
           ended 31st March, 2001

     (II) For the previous financial years      Nil                                    Nil
          since it became subsidiary.

5.   As the financial years of subsidiary
     Companies coincide with the financial
     year of the Holding Company,                                                      * As per audited accounts for the year
     Section 212(5) of the Companies                                                   ended 31.12.2000.
     Act, 1956, is not applicable.                                                     Ref. Note in Directors' Report




                                                                                               For and on behalf of Board of Directors

                                                                                                                GAUTAM THAPAR
                                                                                                                S K KHANDELWAL
Place : New Delhi                                                                                                 A K CHATTERJEE
Dated : 20th June, 2001                                                                                                   Directors




                                                                  80
THE PIONEER LIMITED


Directors’ Report
To The Members,                                                                         CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION,
                                                                                        FOREIGN EXCHANGE EARNING AND OUTGO
Your Directors present their Sixty-ninth Annual report together with the
audited accounts of the Company for the financial year ended 31st March,                The particulars as required under rule (2) of the Companies (Disclosure of
2001.                                                                                   particulars in the report of the Board of Directors) Rules, 1988, relating to
                                                                                        conservation of energy and technology absorption are given hereunder:-
FINANCIAL RESULTS                                                  (Rs. in Lacs)
                                                                                        1.     Conservation of Energy                               : Not Applicable
Profit for the year before exceptional item                              34.09
Less: Exceptional Item                                                  279.56          2.     Technology absorption                                : Not Applicable

Loss as per Profit & Loss Account                                       245.47          3.     Total Foreign Exchange Earning and Outgo:
Add: Prior year adjustments                                               2.23
                                                                                               (a)   Total foreign exchange earning                 : Nil
Loss brought forward from the last year                              7,835.67
                                                                     8,083.37                  (b) Total foreign exchange outgo                     : Nil

Less: Investment Allowance Reserve written back                             .33
                                                                                        DE-LISTING OF SHARES
Loss carried to the Balance Sheet                                    8,083.04
                                                                                        In pursuance of the resolution passed by the Shareholders of the Company in
OPERATIONS                                                                              the last Annual General Meeting held on 12th July, 2000, for de-listing of
                                                                                        securities, the Company has been de-listed from the respective Stock
AGENCIES & CONTRACT DIVISION
                                                                                        Exchanges.
During the year under review, the Agencies & Contract Division was sold as a
going concern and the loss on account of sale of such Division had been shown           DIRECTORS' RESPONSIBILITY STATEMENT
separately as an EXCEPTIONAL ITEM. Accordingly, the contract realisation
                                                                                        Your Directors report -
for the period from 1st April, 2000, to 31st December, 2000, was Rs.173.44
lacs as against Rs. 259.22 lacs in the previous year, is not strictly comparable        (i)    that in the preparation of annual accounts the applicable accounting
with last year's realisation which represented a period of 12 months.                          standards have been followed along with proper explanations relating to
                                                                                               material departure
HOLDING COMPANY
Your Company continues to be a subsidiary of Janpath Investments & Holdings             (ii)   that the Directors had selected such accounting policies and applied
Limited and M/s. Ballarpur Industries Limited had become the Company's                         them consistently and made judgement and estimates that are reasonable
ultimate holding company.                                                                      and prudent so as to give a true and fair view of the state of the affairs of
                                                                                               the Company at the end of the financial year 2000-2001, and of the loss
DEPOSITS                                                                                       of the Company for that period

The Company has not accepted any deposits during the year under report.                 (iii) that the Directors had taken proper and sufficient care for the maintenance
                                                                                              of adequate accounting records in accordance with the provisions of this
DIRECTORS                                                                                     act for safeguarding the assets of the Company and for preventing and
         .
Shri O. P Jain and Shri Pratap Pawar, Directors of the Company, retire by                     detecting fraud and other irregularities
rotation at the ensuing annual general meeting and have offered themselves
for re-appointment.                                                                     (iv) that the Directors had prepared the annual accounts on a going concern
                                                                                             basis.
AUDITORS
Messers B. Chhawchharia & Co., Chartered Accountants, Auditors of the
Company, retire at the conclusion of the ensuing annual general meeting and
are eligible for re-appointment.
                                                                                                                                          For and on behalf of the Board
PARTICULARS OF EMPLOYEES
Particulars of employees as required u/s 217 (2A) of the Companies Act,
1956, read with the Company (Particulars of Employees) Rules, 1975, as                                                                                               .
                                                                                                                                                                O. P Jain
amended to date, are not applicable to the Company as there was no employee             Place: New Delhi                                                          .
                                                                                                                                                              O. P Arora
in receipt of prescribed remuneration.                                                  Dated : 25th May, 2001                                                     Director




                                                                                   81
                                                                                                                                       THE PIONEER LIMITED


Auditors’ Report
TO THE MEMBERS OF THE PIONEER LIMITED                                              7.    The Company has taken loan from the Holding Company and the terms
                                                                                         and conditions of such loans are not prima-facie prejudicial to the interest
We have audited the attached Balance Sheet of THE PIONEER LIMITED as
                                                                                         of the Company. The Company has not taken any loan secured or
at 31st March, 2001, and the Profit & Loss Account for the year ended on
                                                                                         unsecured from companies firms or other parties listed in the register
that date annexed thereto and report that :-
                                                                                         maintained under section 301 of the Companies Act, 1956, or from
1. As required by the Manufacturing and other Companies (Auditors Report)                Companies under the same management as defined under section 370(1B)
     Order, 1988, issued by the Company Law Board in terms of Section                    of the Companies Act, 1956.
     227(4A) of the Companies Act, 1956, we enclose in the Annexure a
                                                                                   8.    The Company has not granted any loans, secured or unsecured to
     Statement on the matters specified in paragraphs 4 and 5 of the said
                                                                                         companies firm or other parties listed in the register maintained under
     Order.
                                                                                         section 301 of the Companies Act, 1956, or to the Companies under
2. Further to our comments in the Annexure referred to in paragraph 1                    the same management as defined under section 370(1B) of the Companies
     above, we state that :-                                                             Act, 1956.
     (a) We have obtained all the information and explanations which to            9.    Employees to whom loans or advances in the nature of loans have been
          the best of our knowledge and belief were necessary for the purpose            given by the Company, are repaying the principal amounts as per
          of our audit.                                                                  stipulations, wherever such stipulation exists.
     (b) In our opinion, proper books of account as required by Law have
                                                                                   10.   In our opinion and according to the information and explanations given to
          been kept by the Company so far as appears from our examination
                                                                                         us, there are adequate internal control procedures commensurate with
          of such books.
                                                                                         the size of the Company and the nature of its business with regard to the
     (c) The Balance Sheet and the Profit and Loss Account referred to in
                                                                                         purchase of stores, raw materials including components, plant and
          this report are in agreement with the books of account.
                                                                                         machinery, equipment and other assets and with regard to the sale of
     (d) In our opinion, the Profit & Loss Account and the Balance Sheet
                                                                                         goods.
          comply with the Accounting Standards referred to in Section
          211(3c) of the Companies Act, 1956, to the extent applicable.            11.   There are no transactions of purchase of goods and materials and sale of
     (e) Based on the representations made by the Directors of the                       goods materials and services aggregating during the year to Rs.50000/-
          Company and the information and explanations as made available,                or more in respect of each party in pursuance of contracts or arrangements
          none of the Directors of the Company is prima-facie, as at 31st                entered in the register maintained under section 301 of the Companies
          March, 2001, disqualified from being appointed as Director of the              Act, 1956.
          Company in terms of clause (g) of sub-section (1) of section 274 of      12.   As explained to us, the Company has a regular procedure for the
          The Companies Act, 1956.                                                       determination of unserviceable or damaged stores, raw materials and
     (f) In our opinion and to the best of our information and according to              finished goods. Adequate provision has been made in the accounts for
          the explanations given to us the Accounts read together with the               the loss arising on the items so determined
          notes thereon give the information required by the Companies             13.   The Company has not accepted any deposits from the public during the
          Act, 1956, in the manner so required and give a true and fair                  year.
          view :-                                                                  14.   In our opinion reasonable records have been maintained by the Company
          (i) In the case of the Balance Sheet of the state of affairs of the            for the sale and disposal of scrap. There is no by-product arising out of
                Company as at 31st March, 2001, and                                      the manufacturing process of the Company.
          (ii) In the case of the Profit and Loss Account, of the loss for the     15.   The Company did not have an internal audit system during the year.
                year ended on that date.                                           16.   Maintenance of cost records has not been prescribed by the Central
                                        For B. CHHAWCHHARIA & CO.                        Government under Section 209(1)(d) of the Companies Act, 1956, for
                                                  Chartered Accountants,                 the product of the Company.
                                                                                   17.   According to the records of the Company, Provident Fund dues have
                                                                                         generally been regularly deposited during the year with the appropriate
                                                                                         authorities.
Place : New Delhi                                                   .
                                                                   P L. Gupta      18.   According to the information and explanations given to us there are no
Dated: 25th May, 2001                                                   Partner          undisputed amounts payable in respect of Income Tax, Wealth Tax, Sales
                                                                                         Tax, Customs duty and Excise duty which are outstanding as on 31st
                                                                                         March, 2001, for a period of more than six months from the date they
ANNEXURE
                                                                                         became payable.
Referred to in paragraph 1 of our report of even date on the accounts for the      19.   According to the information and explanations given to us, no personal
year ended 31st March, 2001 of THE PIONEER LIMITED.                                      expenses of employees or Directors have been charged to revenue
1. The Company has maintained proper records showing full particulars                    account, other than those payable under contractual obligations or in
     including quantitative details and situation of its fixed assets. The fixed         accordance with generally accepted business practice.
     assets have been physically verified by the Management during the year.       20.   The Company is not covered under the definition of scheduled industry
     To the best of our knowledge no material discrepancies have been                    as specified by the First Schedule to the Industries (Development &
     noticed on such verification.                                                       Regulation) Act, 1951, and accordingly Section 3(1) clause (o) of the Sick
2. None of the fixed assets have been re-valued during the year.                         Industrial Companies (Special Provisions) Act, 1985, is not applicable.
3. The stocks of stores, spare parts and raw materials except for items            21.   In respect of service activities of the Company :
     held by third parties have been physically verified during the year by the          (i) There is a reasonable system of recording receipts, issues and
     Management, in our opinion the frequency of verification is reasonable.                   consumption of materials and stores , commensurate with the size
4. The procedures of physical verification of stocks followed by the                           of the Company and the nature of its business.
     Management are reasonable and adequate in relation to the size of the               (ii) In our opinion there is a reasonable system of authorisation at
     Company and the nature of its business.                                                   proper levels with necessary control on the issue of stores and the
5. The discrepancies noticed on verification between the physical stock                        system of internal control is commensurate with its size and the
     and the book records were not material and the same have been                             nature of its business.
     properly dealt with in the books of account.                                                                            For B. CHHAWCHHARIA & CO.
6. On the basis of our examination of stock records, we are of the opinion                                                             Chartered Accountants,
     that the valuation of stocks is fair and proper in accordance with the
     normally accepted accounting principles and is on the same basis as in
     the preceding year.                                                           Place : New Delhi                                                     .
                                                                                                                                                        P L. Gupta
                                                                                   Dated: 25th May, 2001                                                     Partner


                                                                                   82
THE PIONEER LIMITED


Balance Sheet
AS AT 31ST MARCH, 2001

                                                                                      2000-2001                     1999-2000
                                                                Schedule                 Rupees         Rupees         Rupees              Rupees

SOURCES OF FUNDS :

SHAREHOLDERS’ FUNDS
   Share Capital                                                    1              44,99,86,400                   44,99,86,400
   Reserves and Surplus                                             2                         –    44,99,86,400         33,000       45,00,19,400

LOAN FUNDS
   Unsecured                                                        3              41,63,59,045    41,63,59,045   42,13,59,045       42,13,59,045

     TOTAL                                                                                         86,63,45,445                        871378445


APPLICATION OF FUNDS :

FIXED ASSETS                                                        4
    Gross Block                                                                       1,31,900                        5,36,861
    Less: Depreciation                                                                  81,169                        2,91,992
    Net Block                                                                                           50,731                           2,44,869

INVESTMENTS                                                         5                                   27,600                             27,600

CURRENT ASSETS, LOANS AND ADVANCES                                  6
   Inventories                                                                                –                      30,72,984
   Sundry Debtors                                                                     27,94,993                    2,68,48,370
   Cash and Bank Balances                                                             22,95,155                    1,09,00,855
   Loans and Advances                                                              11,43,88,272                   11,14,57,092

                                                                                   11,94,78,420                   15,22,79,301

LESS : CURRENT LIABILITIES AND PROVISIONS
       Liabilities                                                  7               6,15,15,466                    6,47,40,407
NET CURRENT ASSETS                                                                                  5,79,62,954                       8,75,38,894
Profit & Loss Account                                                                              80,83,04,160                      78,35,67,082

     Total                                                                                         86,63,45,445                      87,13,78,445

Notes on Accounts                                                  12


The Schedules referred to above form an integral part of the Balance Sheet.




As per our Report of even date attached.
for B. CHHAWCHHARIA & CO.
Chartered Accountants

 .
P L. GUPTA
Partner
                                                                                                                                       .
                                                                                                                                  O. P JAIN
Place : New Delhi                                                              RAJEEV KUMAR                                          .
                                                                                                                                 O. P ARORA
Dated : 25th May, 2001                                                         Company Secretary                                    Directors




                                                                              83
                                                                                                                 THE PIONEER LIMITED


Profit & Loss Account
FOR THE YEAR ENDED 31ST MARCH, 2001

                                                                                                   2000-2001                  1999-2000
                                                                Schedule                              Rupees                     Rupees



INCOME
    Contract Realisation (including                                                               1,73,43,818                2,59,22,450
    tax deducted at source Rs. 381564/-
    previous year Rs. 570294/-)
    Miscellaneous                                                  8                                12,24,750                1,15,91,326

                                                                                                  1,85,68,568                3,75,13,776


EXPENDITURE
    Contract Works Expenses                                                                       1,05,16,505                1,69,37,803
    Personnel Expenses                                            9                                 12,81,516                  15,48,453
    Interest                                                      10                                   19,121                   1,19,715
    Other Expenses                                                11                                32,69,109                  50,11,679
    Bad & Irrecoverable balances written off                                                                –                1,75,02,285
    Depreciation                                                                                       73,651                     61,766

                                                                                                  1,51,59,902                4,11,81,701

PROFIT/(LOSS) FOR THE YEAR
BEFORE EXCEPTIONAL ITEMS                                                                            34,08,666                 (36,67,925)
    Less : Exceptional Item                                                                       2,79,55,700                          –

PROFIT/(LOSS) FOR THE YEAR                                                                       (2,45,47,034)                (36,67,925)
   Prior period adjustments (Net)                                                                     2,23,044                    83,854
   Balance brought toward                                                                         78,35,67,082              78,00,15,303

                                                                                                 80,83,37,160               78,37,67,082

    Investment Allowance Reserve written back                                                          33,000                   2,00,000

LOSS CARRIED TO BALANCE SHEET                                                                    80,83,04,160               78,35,67,082



Notes on Accounts                                                 12




The Schedules referred to above form an integral part of the Profit and Loss Account




As per our Report of even date attached.
for B. CHHAWCHHARIA & CO.
Chartered Accountants

 .
P L. GUPTA
Partner
                                                                                                                              .
                                                                                                                         O. P JAIN
Place : New Delhi                                                            RAJEEV KUMAR                                   .
                                                                                                                        O. P ARORA
Dated : 25th May, 2001                                                       Company Secretary                             Directors




                                                                           84
THE PIONEER LIMITED


Schedules
SCHEDULE 1 – SHARE CAPITAL

                                                                                                  2000-2001                     1999-2000
                                                                                      Rupees         Rupees          Rupees        Rupees

AUTHORISED
    1200000       15 % Cumulative Redeemable Preference                                         12,00,00,000                  12,00,00,000
                  Shares of Rs.100/- each
    38000000      Equity Shares of Rs.10/- each                                                 38,00,00,000                  38,00,00,000

                                                                                                50,00,00,000                  50,00,00,000

ISSUED AND SUBSCRIBED
    1200000       15% Cumulative Redeemable Preference Shares
                  of Rs.100/- each fully paid up.( 6133 shares redeemable not
                  later than 31-3-2003 and 1193867 shares redeemable not
                  later than 1-3-2006).                                                         12,00,00,000                  12,00,00,000
    32998640      Equity Shares of Rs.10/- each fully paid up                                   32,99,86,400                  32,99,86,400

                                                                                                44,99,86,400                  44,99,86,400

Note:    1.   Of the above, 49830 Equity Shares were allotted as fully paid up
              Bonus Shares by capitalisation of General Reserve.
         2.   32728650 Equity shares and 916133 -15% Cumulative
              Redeemable Preference Shares are held by the
              Holding company.


SCHEDULE 2 – RESERVES AND SURPLUS

CAPITAL RESERVE
    Subsidy (As per per last Account)                                                      –                        30,000
    Less : Transferred to Profit & Loss Account                                            –              –         30,000              –

INVESTMENT ALLOWANCE RESERVE
    As per last Account                                                               33,000                       2,33,000
    Transferred to Profit & Loss Account                                              33,000              –        2,00,000        33,000

                                                                                                          –                        33,000


SCHEDULE 3 – LOANS


UNSECURED
From Holding Company                                                             12,32,28,961                  12,82,28,961
From Other Company                                                               21,05,68,468                  21,05,68,468
Interest accrued and due                                                          8,25,61,616   41,63,59,045    8,25,61,616   42,13,59,045

                                                                                                41,63,59,045                  42,13,59,045




                                                                           85
                                                                                                                      THE PIONEER LIMITED


SCHEDULE 4 – FIXED ASSETS


                                                    COST                               DEPRECIATION                              NET VALUE
                          As at                    Sales/ad-    As at       As at Withdrawn For the       Deduc- To-date     As at      As at
Description           1-4-2000 Additions          justments 31-3-2001   1-4-2000      during   year         tions        31-3-2001 31-3-2000
                                                                                        Year
                             Rs.        Rs.            Rs.        Rs.          Rs.      Rs.      Rs.            Rs.      Rs.        Rs.         Rs.

Plant & Machinery 1,30,235           0            1,30,235          0     50,796         0     8,325      59,121           0         0       79,439
Vehicles             1,30,437    1,430            1,31,867          0     85,833         0    10,131      95,964           0         0       44,604
Computer               49,662 1,17,840            1,67,502          0     10,558         0    28,105      38,663           0         0       39,104
Furniture & Fixtures 1,91,527   19,494              79,121   1,31,900   1,09,805         0    27,090      55,726      81,169    50,731       81,722
Temporary
Construction           35,000        0             35,000          0      35,000         0         0      35,000          0          0           0

Total                 5,36,861 1,38,764           5,43,725   1,31,900    291,992         0    73,651    2,84,474      81,169    50,731     2,44,869
Previous Year      4,28,35,095      54,393 4,23,52,627       5,36,861 3,01,12,395 31,92,542   61,766 2,66,89,627 2,91,992      2,44,869




SCHEDULE 5 – INVESTMENTS
                                                                                                  2000-2001                               1999-2000
                                                                                                     Rupees                                  Rupees

LONG TERM INVESTMENTS
TRADE INVESTMENTS
UNQUOTED
50 Shares of Hindustan Samachar Cooperative
Society Ltd. of Rs.100/-each fully paid up                                                              5,000                                 5,000
105 Equity Shares of Press Trust of India Ltd
of Rs.100/- each fully paid up                                                                         10,500                                10,500
                                                                                                       15,500                                15,500
OTHER INVESTMENTS
QUOTED
2500 Equity Shares of Ravi Air Cools Ltd
of Rs.10/- each fully paid up                                                                          25,000                                25,000

UNQUOTED
1.   In Government Securities:
             .
     3% G. P Notes of 1946. Face Value Rs.2500/-
     including Rs.15000/- lodged as security                                                            2,100                                 2,100

2.   In fully paid Equity Shares:
     400 Ordinary Shares of the Cooperative Electric
     Supply Society Ltd. (in liquidation) of Rs.25/-each
     fully paid up                                                                                     10,000                                10,000
                                                                                                       52,600                                52,600

     Less : Provision towards diminution in the
     Book value of investment                                                                          25,000                                25,000
                                                                                                       27,600                                27,600
     Aggregate book value of quoted investments                                                        25,000                                25,000
     Aggregate market value of quoted investments                                                           –                                15,000
     Aggregate book value of unquoted investments                                                      27,600                                27,600




                                                                          86
THE PIONEER LIMITED


SCHEDULE 6 - CURRENT ASSETS, LOANS AND ADVANCES

                                                                    2000-2001                    1999-2000
                                                        Rupees         Rupees         Rupees        Rupees

A.   CURRENT ASSETS
     Inventories (as valued and
     certified by the Management)                                           –                    30,72,984

     Sundry Debtors
     due for more than six months:
     Unsecured, considered good                      27,94,993                    86,85,332
     Unsecured, considered Bad
     and/or doubtful                                 15,75,397                    15,75,397
                                                     43,70,390                   1,02,60,729
     Less: Provision for Bad and/or
     doubtful debts                                  15,75,397                    15,75,397
                                                     27,94,993                    86,85,332
Other debts:
    Unsecured considered good                                –      27,94,993    1,81,63,038    2,68,48,370
Cash and Bank balances
    with Scheduled Banks:
    On Current Account                               16,99,797                    13,07,249
    On Fixed Deposit Account                          5,00,000                    95,00,000
    Interest accrued on Fixed Deposit                   16,641                       66,607
    Cash in hand                                        78,717      22,95,155        26,999     1,09,00,855

B.   LOANS AND ADVANCES
     (Unsecured considered good)
     Advances recoverable in cash or in
     kind or for value to be received               9,69,89,513                  9,20,87,067
     Security Deposits                                21,34,827                    27,48,491
     Advance Payment of Income-tax                  1,52,63,932                  1,66,21,534
                                                                  11,43,88,272                 11,14,57,092
                                                                  11,94,78,420                 15,22,79,301

SCHEDULE 7 - CURRENT LIABILITIES AND PROVISIONS

LIABILITIES
    Sundry Creditors                                2,82,40,708                  3,14,71,779
    Due to Holding Company                          3,32,42,258                  3,30,32,783
    Provision for gratuity                                    –                     1,33,245
    Security Deposits                                    32,500                     1,02,600
                                                                   6,15,15,466                  6,47,40,407
                                                                   6,15,15,466                  6,47,40,407

SCHEDULE 8 - MISCELLANEOUS INCOME

Rental Income (including tax deducted at
source Rs.29982/- Previous year Rs.565307/-)                         1,41,412                    39,87,532
Interest -
I) On Income Tax refund                               2,54,226                    14,55,391
ii) On Fixed Deposit (including tax
     deducted at source Rs 1,12,120/-
     previous year Rs.63,123/-)                       5,08,519       7,62,745      3,59,047      18,14,438
Profit on sale of fixed assets                                              –                    23,92,499
Excess Provision/Liabilities written back                              28,744                    32,30,580
Sundry Receipts                                                      2,91,849                     1,66,277
                                                                    12,24,750                   1,15,91,326




                                               87
                                                                                                                                THE PIONEER LIMITED


SCHEDULE 9 - PERSONNEL EXPENSES

                                                                                                            2000-2001                              1999-2000
                                                                                            Rupees             Rupees                Rupees           Rupees

Salaries wages bonus and gratuity                                                                            11,53,696                              13,88,537
Contribution to Provident/Family pension funds etc.                                                             89,777                                 93,699
EDLI Expenses                                                                                                    1,800                                      –
Staff Welfare Expenses                                                                                          36,243                                 66,217
                                                                                                             12,81,516                              15,48,453

SCHEDULE 10 - INTEREST

On Bank Loans                                                                                                        –                                  97,350
On Other accounts                                                                                               19,121                                  22,365
                                                                                                                19,121                                1,19,715


SCHEDULE 11 - OTHER EXPENSES

Power & Fuel                                                                                                    36,568                                4,18,498
Rent                                                                                                          2,30,919                              11,36,118
Lease Rent (Net)                                                                                              1,46,145                                1,12,950
Rates and Taxes                                                                                                   8,225                                 12,537
Insurance                                                                                                       25,100                                  36,155
Travelling and conveyance                                                                                     9,86,084                              11,57,334
Auditors’ Remuneration
       Audit Fee                                                                              5,250                                  5,250
       for tax audit                                                                          2,100                                  5,250
       for other services                                                                     6,300                                  7,350
       reimbursement of expenses                                                              5,000             18,650               5,000              22,850
Legal & Professional fees                                                                                     7,26,267                                7,70,702
Provision towards diminution in book value
of Investments                                                                                                        –                                 15,000
Security Expenses                                                                                             2,21,585                                        –
Sales tax paid                                                                                                2,44,963                                4,30,507
Misc. expenses                                                                                                6,24,603                                8,99,028
                                                                                                             32,69,109                              50,11,679



SCHEDULE 12 - NOTES ON ACCOUNTS

1.     SIGNIFICANT ACCOUNTING POLICIES

       Fixed Assets: Fixed assets are stated at their original cost including freight, duties, taxes and other incidental expenses related to acquisition and
       installation. Expenditure during construction period including interest on specific borrowing for new major projects are capitalised till commencement of
       commercial production.
       Depreciation : Depreciation on building and plant and machinery is provided on straight line method and on other fixed assets on written down value
       method at the rates specified in Schedule XIV to the Companies Act.
       Inventory valuation: Stores and spares are valued at weighted average cost.
       Investments: Long term investments are stated at cost. Provision for diminution in the book value of long term investment is made only if such a decline
       is other than temporary in nature.
       Revenue recognition: As per requirement of the Companies (Amendment) Act, 1988, all expenses and revenues are accounted for on accrual basis.
       Gratuity: Provision for gratuity is made in accounts based on actuarial valuation.
       Income from Investments: Income from investments is accounted for on accrual basis and tax deducted at source thereon is treated as advance tax.




                                                                                88
THE PIONEER LIMITED

2.   CONTINGENT LIABILITIES:
     a)     Income tax demand under appeal – Rs.14486282/- (Previous year Rs.14486282/-) pending disposal of appeal. However, the said demand has been
            adjusted by Income Tax Department against refund of TDS for subsequent years.
     b)     Sales tax demand under appeal Rs.3106827/- (Previous year Rs.3106827/-)
     c)     Claims filed by the workers against the Company not admitted as liability. Amount indeterminate.
     d)     Arrears of preference dividend up to 31.3.2001 Rs.90766615/- (Previous year Rs.72766615/-).

3.   EXCEPTIONAL ITEM:
     Loss on sale of Agencies & Contract Division                    Rs.2,79,55,700/-

4.   PRIOR PERIOD ADJUSTMENTS                                              2000-2001                                        1999-2000
                                                                                    Rs.                                              Rs.
     Publicity and Advertisement                                                      –                                          9,000
     Rent                                                                             –                                       1,04,144
     Insurance-DLI                                                                    –                                        -29,290
     Payment for credit balances written
     back in earlier year/(s)                                                   14,878                                                –
     Stores Consumption                                                      2,08,166                                                 –
     TOTAL                                                                   2,23,044                                           83,854



5.   In terms of the memorandum of understanding dated 16th May, 1998, the Company had also permitted CMYK, use of leased premises, the rental of which
     would be reimbursed by CMYK. A dispute has since arisen regarding taking/giving possession of Link House (New Delhi), adjustment for rent payable/
     receivable amounting to Rs.1947372/- will be made on settlement of dispute. No provision of rent for the financial year 2000-2001, as lease expired in April,
     2000. However, non-accounting of the rent receivable/payable will not affect the profit/loss for the year.
6.   Certain accounts of customers/suppliers, loans and advances are subject to confirmation.
7.   Contract work expenses include (a) Stores and paints consumed Rs.73,49,646/- (previous year Rs.1,25,12,861/-) and (b) Labour charges Rs.31,66,859/-
     (previous year Rs.44,24,942/-)
8.   Previous year figures have been regrouped/re-arranged wherever necessary to make them comparable with those of the current year.



Signature to Schedule 1 to 12
for B. CHHAWCHHARIA & CO.
Chartered Accountants
 .
P L. GUPTA
Partner

                                                                                                                                                   .
                                                                                                                                              O. P JAIN
Place : New Delhi                                                                RAJEEV KUMAR                                                    .
                                                                                                                                             O. P ARORA
Dated : 25th May, 2001                                                           Company Secretary                                              Directors




                                                                               89
                                                                                                                      THE PIONEER LIMITED


BALANCE SHEET ABSTRACT AND COMPANY'S GENERAL BUSINESS PROFILE



I.     REGISTRATION DETAILS

       Registration No. :                          0   0   4   7   3   State Code :               2   0

       Balance Sheet Date :                    3   1       0   3       2   0      0 1
                                               Date        Month            Year

II.    CAPITAL RAISED DURING THE YEAR :

       Public Issue :                              N   I   L                   Rights Issue :                         N   I   L

       Bonus Issue :                               N   I   L                   Private Placement :                    N   I   L

III.   POSITION OF MOBILISATION AND DEPLOYMENT OF FUNDS : (Amount in Rs.)

       Total Liabilities :            8    6   6   3   4   5   4   4   5       Total Assets :             8   6   6   3   4   5    4   4   5

       SOURCES OF FUNDS : (Amount in Rs.)

       Paid-Up Capital :              4    4   9   9   8   6   4   0   0       Reserves & Surplus :                   N   I   L

       Secured Loans :                         N   I   L                       Unsecured Loans :          4   1   6   3   5   9    0   4   5

       APPLICATION OF FUNDS: (Amount in Rs.)

       Net Fixed Assets :                              5   0   7   3   1       Investments :                              2   7    6   0   0

       Net Current Assets :                5   7   9   6   2   9   5   4       Misc. Expenditure :                    N   I   L

       Accumulated Losses :           8    0   8   3   0   4   1   6   0

IV.    PERFORMANCE OF THE COMPANY: (Amount in Rs.)

       Turnover
       (incl other income)                 1   8   5   6   8   5   6   8       Total Expenditure :            4   3   1   1   5    6   0   2

       Loss before Tax :                   2   4   5   4   7   0   3   4       Loss after Tax :               2   4   5   4   7    0   3   4

       Earning Per Share                           N   I   L                   Dividend Rate (%) :                    N   I   L

V.     GENERIC NAMES OF THREE PRINCIPAL PRODUCTS/SERVICES OF THE COMPANY N.A.



As per our Report of even date attached.
for B. CHHAWCHHARIA & CO.
Chartered Accountants

 .
P L. GUPTA
Partner
                                                                                                                                        .
                                                                                                                                   O. P JAIN
Place :New Delhi                                                            RAJEEV KUMAR                                              .
                                                                                                                                  O. P ARORA
Dated :25th May, 2001                                                       Company Secretary                                        Directors




                                                                           90
JG CONTAINERS (MALAYSIA) SENDIRIAN BERHAD
(INCORPORATED IN MALAYSIA)


Directors' Report
The directors have pleasure in presenting their annual report                                 Neither during nor at the end of the financial year was the company a
together with the audited accounts of the company for the year ended                          party to any arrangement whose object was to enable the directors to
December 31, 2000.                                                                            acquire benefits by means of the acquisition of shares in, or debentures of
                                                                                              the company or any other body corporate.
1.   PRINCIPAL ACTIVITY
                                                                                         6.   OTHER STATUTORY INFORMATION
     The principal activity of the company is the manufacture and sale of glass
                                                                                              Before the accounts of the Company were made out, the directors took
     containers.
                                                                                              reasonable steps :
     There has been no significant change in the nature of this activity during
     the year.                                                                                (i)    to ascertain that action had been taken in relation to the writing off
                                                                                                     of bad debts and the making of provision for doubtful debts and
2.   RESULTS FOR THE FINANCIAL PERIOD                                                                satisfied themselves that all known bad debts had been written off
                                                                                                     and that adequate provision had been made for doubtful debts; and
                                                          Rs.                RM
                                                                                              (ii)   to ensure that any current assets which were unlikely to realise their
     Net Loss for the year                    (3,39,79,644)        (2,767,072)
                                                                                                     book values in the ordinary course of business had been written
     Losses brought forward                 (19,56,16,409)        (15,929,675)                       down to their expected realisable value.
     Losses carried forward                 (22,95,96,053)        (18,696,747)                At the date of this report, the directors are not aware of any
                                                                                              circumstances :
     The results of the operations of the company have not been substantially
     affected by any item, transaction or event of a material and/or unusual                         (i)    which would render the amounts written off or provided for
     nature during the financial year, except that production was suspended                                 doubtful debts in the accounts of the company inadequate to
     from 8.11.2000 to 31.12.2000 to repair the furnace which had earlier                                   any substantial extent;
     broken down.                                                                                    (ii)   which would render the values attributed to current assets in
                                                                                                            the accounts of the company misleading;
3.   DIVIDENDS                                                                                       (iii) which have arisen which render adherence to the existing
     No dividend is recommended or has been paid since the end of the                                      method of valuation of assets or liabilities of the company
     previous financial year.                                                                              misleading or inappropriate; and
                                                                                                     (iv) which would render any amount stated in the accounts of the
4.   ISSUE OF SHARES                                                                                      company misleading.
     During the financial year the issued share capital of the company was                    At the date of this report, there does not exist :
     increased from RM 17,305,690 to RM 18,388,111 by way of an issue of
                                                                                                     (i)    any charge on the assets of the company that has arisen since
     1,082,421 ordinary shares of RM 1/- each at par for cash in order to
                                                                                                            the end of the financial year which secures the liability of any
     increase the Company's working capital.
                                                                                                            other person; or
5.   DIRECTORATE                                                                                     (ii)   any contingent liability in respect of the company which has
                                                                                                            arisen since the end of the financial year.
     The directors who held office since the date of the last report
     are :                                                                                    No contingent or other liability of the company has become enforceable
     Lalit Mohan Thapar                                                                       or is likely to become enforceable within the period of twelve months
                                                                                              after the end of the financial year which, in the opinion of the directors,
     Syam Sunder Lal
                                                                                              will or may affect the ability of the company to meet its obligations as
     Sanjeev Chadha                                                                           and when they fall due.
     Ratnam S/o Ramasamy Pillai
                                                                                              In the opinion of the directors no item, transaction or event of a material
     Gautam Thapar                                                                            or unusual nature has arisen in the interval between the end of the financial
     Anil Pahwa                                                                               year and the date of this report which would substantially affect the
     Prabek Kumar Banerjee                                                                    results of the operations of the company for the financial year in which
     (Alternate to Lalit Mohan Thapar)                                                        this report is made.
     Anwardeen a/l Abdul Mohamed
     (Alternate to Syam Sunder Lal)                                                      7.   AUDITORS
     In accordance with the Company's Articles of Association, Ratnam s/o                     The retiring auditors Chari & Co., Public Accountants, have expressed
     Ramasamy Pillai retires, and being eligible, offers himself for re-election.             their willingness to continue in office.
     None of the directors held any shares in the company during the year
     ended December 31, 2000.                                                                                                         On behalf of the Board of Directors
     Since the end of the previous financial period, no director has received or
     become entitled to receive any benefit (other than benefits included in
                                                                                                                                                    SANJEEV CHADHA
     the aggregate emoluments received or due and receivable by directors as
                                                                                                                                                              Director
     shown in the accounts) by reason of a contract made by the company or
     a related corporation with the director or with a firm of which the
     director is a member or with a company in which the director has a                  Place : Kuala Lumpur                ANWARDEEN A/L ABDUL MOHAMED
     substantial financial interest.
                                                                                         Date : 28th May, 2001                  (Alternate Director to Syam Sunder Lal)




                                                                                    91
                                                                            JG CONTAINERS (MALAYSIA) SENDIRIAN BERHAD
                                                                                                                          (INCORPORATED IN MALAYSIA)


Statement by Directors                                                                 Report of the Auditors
We, Sanjeev Chadha and Anwardeen A/L Abdul Mohamed being two of the                    To The Members of
directors of Jg Containers (Malaysia) Sendirian Berhad do hereby state that, in        Jg CONTAINERS (MALAYSIA) SENDIRIAN BERHAD
the opinion of the directors, the accounts set out on pages 6 to 15 are drawn          We have audited the accounts set out on pages 6 to 15 of Jg Containers
up in accordance with applicable approved accounting standards in Malaysia             (Malaysia) Sendirian Berhad. The preparation of the accounts is the
so as to give a true and fair view of the state of affairs of the Company as at        responsibility of the Company's directors. Our responsibility is to express an
December 31, 2000, and of its results and cash flows for the year ended on             opinion on the account based on our audit.
that date.
                                                                                       We conducted our audit in accordance with approved standards on auditing in
                                         On behalf of the Board of Directors           Malaysia. These standards require that we plan and perform the audit to
                                                                                       obtain all the information and explanations, which we consider necessary to
                                                       SANJEEV CHADHA                  provide us with evidence to give reasonable assurance that the accounts are
                                                                       Director        free of material misstatement. An audit includes examining, on a test basis,
                                                                                       evidence relevant to the amounts and disclosures in the accounts. An audit
                                                                                       also includes an assessment of the accounting principles used and significant
                                                                                       estimates made by the directors as well as evaluating the overall adequacy of
Place : Kuala Lumpur             ANWARDEEN A/L ABDUL MOHAMED
                                                                                       the presentation of information in the accounts. We believe our audit provides
Date : 28th May, 2001               (Alternate Director to Syam Sunder Lal)
                                                                                       a reasonable basis for our opinion.

                                                                                       In our opinion :

                                                                                       (a)   the accounts are properly drawn up in accordance with the provisions of
Statutory Declaration                                                                        the Companies Act, 1965 and the applicable approved accounting
                                                                                             standards in Malaysia so as to give a true and fair view of :
I, Sanjeev Chadha, being the director primarily responsible for the financial
management of Jg Containers (Malaysia) Sendirian Berhad, do solemnly and                     i)    the state of affairs of the company at December 31, 2000 and of
sincerely declare that the accounts set out on pages 6 to 15 are to the best of                    its results and cash flows for the year ended on that date; and
my knowledge and belief, correct and I make this solemn declaration
                                                                                             ii)   the matters required by Section 169 of the Companies Act, 1965
conscientiously believing the same to be true, and by virtue of the provisions
                                                                                                   to be dealt with in the accounts of the company; and
of the Statutory Declarations Act, 1960.
                                                                                       (b) the accounting and other records and the registers required by the Act
SANJEEV CHADHA                                                                               to be kept by the company have been properly kept in accordance with
                                                                                             the provisions of the Act.
Subscribed and solemnly declared by the above named Sanjeev Chadha at                                                                                  CHARI & CO.
Kuala Lumpur in the Federal Territory this 28th day of May, 2001.                                                                                        No. AF 0174
                                                                                                                                                    Public Accountants



Before me :
                                                                                                                              SUNDARASAN A/L A RUMUGAM

Commissioner for oaths                                                                 Place : Kuala Lumpur                                    Ref. No. 1876/02/02(J)
                                                                                       Date : 28th May, 2001                                                   Partner
Kuala Lumpur




                                                                                  92
JG CONTAINERS (MALAYSIA) SENDIRIAN BERHAD
(INCORPORATED IN MALAYSIA)


Income Statement
FOR THE YEAR ENDED DECEMBER 31, 2000

                                                                                       2000                          1999
                                                                Note                    RM               Rs.          RM


REVENUE                                                          2.9             18,892,689    23,20,02,221    17,485,526

COST OF GOODS SOLD                                                               17,629,329    21,64,88,160    15,834,456

GROSS PROFIT                                                                      1,263,360     1,55,14,061     1,651,070
OTHER OPERATING INCOME
Creditors balance waived                                                              8,081          99,235         2,051
Miscellaneous Income                                                                 28,544        3,50,520        41,172
Insurance Claims received                                                                 –               –        95,238
                                                                                     36,625        4,49,755       138,461

                                                                                  1,299,985     1,59,63,816     1,789,531
DISTRIBUTION COST                                                                 1,053,558     1,29,37,692       939,562
ADMINISTRATIVE EXPENSES                                                           1,673,713     2,05,53,196     1,601,045
OTHER OPERATING EXPENSES                                                            300,459       36,89,637       247,069

                                                                                  3,027,730     3,71,80,525     2,787,676
LOSS FROM OPERATIONS                                                             (1,727,745)   (2,12,16,709)    (998,145)
FINANCE COSTS                                                                     1,039,327     1,27,62,936     1,162,166


LOSS BEFORE TAXATION                                             14              (2,767,072)   (3,39,79,645)   (2,160,311)
TAXATION                                                                                  –               –             –


LOSS AFTER TAXATION                                                              (2,767,072)   (3,39,79,645)   (2,160,311)




The notes set out on pages 10 to 15 form an integral part of the accounts



Note :- Converted in INR @ Rm 1 = Rs 12.28




                                                                            93
                                                                        JG CONTAINERS (MALAYSIA) SENDIRIAN BERHAD
                                                                                                 (INCORPORATED IN MALAYSIA)


Balance Sheet
AS AT DECEMBER 31, 2000

                                                                                         2000                              1999
                                                               Note                       RM                  Rs.            RM


SHAREHOLDERS’ FUNDS
Share Capital                                                    3                 18,388,111       22,58,06,003     17,305,690
Share Redemption Reserve                                         4                  2,250,000        2,76,30,000      2,250,000
Capital Reserve                                                  5                  6,477,245        7,95,40,569      6,477,245

                                                                                   27,115,356       33,29,76,572     26,032,935
Loss carried forward                                                              (18,696,747)     (22,95,96,053)   (15,929,675)

                                                                                    8,418,609       10,33,80,519     10,103,260

DEFERRED LIABILITIES
Term Loan                                                        6                  2,727,906        3,34,98,685      2,727,906
Lease Payable                                                                               –                  –         19,011

                                                                                   11,146,515       13,68,79,204     12,850,177
REPRESENTED BY


FIXED ASSETS                                                     7                 17,020,264       20,90,08,842     17,807,670


CURRENT ASSETS

Stock                                                            8                  3,818,530        4,68,91,548      5,276,990
Moulds and tools                                                 9                  2,713,995        3,33,27,859      2,476,263
Trade debtors                                                   10                  3,175,647        3,89,96,945      4,044,392
Other debtors and advances                                                            205,623          25,25,050        197,392
Cash and bank balances                                                                 12,455           1,52,946          4,550

                                                                                    9,926,250       12,18,94,350     11,999,587
Less :

CURRENT LIABILITIES
Trade creditors                                                                     2,778,596        3,41,21,159      2,943,692
Sundry creditors and accruals                                                       7,394,988        9,08,10,453      8,165,423
Hire Purchase Creditors                                         11                    103,352          12,69,163              –
Bank Overdraft                                                  12                  5,523,063        6,78,23,214      5,923,679

                                                                                   15,799,999       19,40,23,989     17,032,794

NET CURRENT LIABILITIES                                                            (5,873,749)      (7,21,29,638)    (5,033,207)

EXPENDITURE CARRIED FORWARD                                     13                          –                  –         75,714

                                                                                   11,146,515       13,68,79,204     12,850,177

The notes set out on pages 10 to 15 form an integral part of the accounts


Note :- Converted in INR @ Rm 1 = Rs 12.28




                                                                            94
JG CONTAINERS (MALAYSIA) SENDIRIAN BERHAD
(INCORPORATED IN MALAYSIA)


Statement of Changes in Equity
FOR THE YEAR ENDED DECEMBER 31, 2000


                                                                             Share          Share
                                                                            Capital   Redemption        Capital     Accumulated
                                                                                          Reserve       Reserve          Losses           Total
                                                                                 RM           RM            RM              RM             RM

Balance at December 31, 1998                                           17,305,690      2,250,000     6,477,245     (13,769,364)     12,263,571

Net Loss for the year                                                             –             –             –      (2,160,311)    (2,160,311)

Balance at December 31, 1999                                           17,305,690      2,250,000     6,477,245     (15,929,675)     10,103,260

Net Loss for the year                                                             –             –             –      (2,767,072)    (2,767,072)

Issue of share capital                                                  1,082,421              –             –                –      1,082,421

Balance at December 31, 2000                                           18,388,111      2,250,000     6,477,245     (18,696,747)      8,418,609

                              Rs.                                    22,58,06,003     2,76,30,000   7,95,40,569   (22,95,96,053)   10,33,80,519

The notes set out on pages 10 to 15 form an integral part of the accounts




                                                                            95
                                                                        JG CONTAINERS (MALAYSIA) SENDIRIAN BERHAD
                                                                                                 (INCORPORATED IN MALAYSIA)


Statement of Cash Flows
FOR THE YEAR ENDED DECEMBER 31, 2000


                                                                                        2000                              1999
                                                                                         RM                   Rs.          RM

CASH FLOW FROM OPERATING ACTIVITIES
Loss before taxation                                                               (2,767,072)       (3,39,79,644)   (2,160,311)
ADJUSTMENT FOR :
Depreciation                                                                       2,007,384         2,46,50,676     2,646,192
Deferred expenses written off                                                         75,714            9,29,768       151,429
Interest expenses                                                                    975,398         1,19,77,887     1,099,847


OPERATING PROFIT BEFORE WORKING
Capital changes                                                                     2,91,424           35,78,687     1,737,157
(Increase) / Decrease in stock                                                     1,458,460         1,79,09,889     (1,687,342)
(Increase) / Decrease in moulds and tools                                           (237,732)         (29,19,349)      281,701
(Increase) / Decrease in debtors                                                     860,514         1,05,67,112      (221,260)
Increase / (Decrease) in creditors                                                  (851,190)        (1,04,52,613)     789,621

Cash generated from operations                                                     1,521,476         1,86,83,725       899,877
Interest paid                                                                       (975,398)        (1,19,77,887)   (1,099,847)

Net cash inflow / (outflow) from operating activities                                546,078           67,05,838      (199,970)


CASH FLOW FROM INVESTING ACTIVITIES
Purchase of fixed assets                                                           (1,219,978)       (1,49,81,330)    (2,44,773)
Net Cash used in investing activities                                              (1,219,978)       (1,49,81,330)    (2,44,773)

                                                                                    (673,900)         (82,75,492)     (444,743)


CASH FLOW FROM FINANCING ACTIVITIES
Term Loan                                                                                   –                   –      380,003
Issue of Shares                                                                    1,082,421         1,32,92,130              –
Net cash provided by financing activities                                          1,082,421         1,32,92,130       380,003
NET INCREASE / ( DECREASE ) IN CASH AND CASH EQUIVALENTS                             408,521           50,16,638        (64,740)


CASH AND CASH EQUIVALENTS AT THE BEGINNING OF THE YEAR                             (5,919,129)       (7,26,86,904)   (5,854,389)


CASH AND CASH EQUIVALENT AT THE END OF THE YEAR                                    (5,510,608)       (6,76,70,266)   (5,919,129)
Represented by :
Cash and bank balances                                                                12,455            1,52,947          4,550
Bank Overdraft                                                                     (5,523,063)       (6,78,23,214)   (5,923,679)

                                                                                   (5,510,608)       (6,76,70,266)   (5,919,129)
The notes set out on pages 10 to 15 form an integral part of the accounts
Note : Converted in INR @ Rm 1 = Rs. 12.28




                                                                            96
JG CONTAINERS (MALAYSIA) SENDIRIAN BERHAD
(INCORPORATED IN MALAYSIA)


Notes to the Accounts
DECEMBER 31,2000
1.   BASIS OF PREPARATION OF ACCOUNTS
     The accounts of the Company have been prepared in accordance with the provisions of the Companies Act 1965 and approved accounting standards.
2.   SIGNIFICANT ACCOUNTING POLICIES
     2.1 Basis of Accounting :
         The accounts of the company have been prepared under the historical cost convention, modified by the revaluation of freehold land which is stated
         at directors valuation.
     2.2 Fixed assets and depreciation :
         Fixed assets are stated at cost less accumulated depreciation. Depreciation is not provided on freehold land. All other fixed assets are depreciated
         on a straight line basis on their estimated useful lives.
          The annual rates used are as follows :-
          Building                                                                    3%
          Plant and machinery, factory tools and equipment                   7.5% to 16%
          Motor Vehicles                                                             20%
          Office equipment                                                           10%
          Furniture and fittings                                                      5%
     2.3 Leased assets :
         The cost of assets acquired under finance lease arrangements are capitalised. The depreciation policy on these assets is similar to that of the
         company’s fixed assets set out in 2.2 above. Outstanding obligations due under the lease agreements after deducting finance expenses are included as
         liabilities in the accounts. The finance expenses of the lease rentals are charged to the profit and loss account over the period of the respective
         agreements.
     2.4 Stock :
         Finished goods have been valued at cost or net realisable value whichever is lower.
          Work-in-process and cullets have been valued at estimated net realisable value.
          Raw materials, packing materials, spares and stores have been valued at cost.
     2.5 Moulds and tools :
         These are stated at cost less amortisation thereon based on their estimated production life.
     2.6 Debtors :
         Debts are written off as soon as it is established by the directors that they are irrecoverable. Provision is made where, in the opinion of the directors
         collection appears doubtful.
     2.7 Deferred expenditure :
         Preliminary and preoperation expenses incurred prior to the commencement of production are written off at the rate of 20% per annum.
     2.8 Foreign Currencies :
         Transactions in foreign currencies during the year have been translated into Malaysian Ringgit at rates of exchange ruling on the dates of the
         transactions. All realised exchange differences are taken up in the profit and loss account. Foreign currency assets and liabilities are translated into
         Malaysian Ringgit at rates approximating those ruling at year end dates.
     2.9 Turnover :
          Turnover of the company represents invoiced value of sales less returns.
     2.10 Cash and cash equivalents :
          Cash and cash equivalents represents cash and bank balances and bank overdrafts.
3.
\    SHARE CAPITAL
     3.1 Authorised :                                                                                        2000                                           1999
                                                                                                              RM                        Rs.                  RM
          Ordinary shares of RM 1/- each                                                              25,000,000            30,70,00,000             22,000,000
          10% convertible Redeemable cumulative
          Preference shares of RM 1/- each                                                                       –                        –           3,000,000
          Balance at December 31                                                                      25,000,000            30,70,00,000             25,000,000

          The authorised capital of the Company was changed from 22,00,000 ordinary shares of RM 1/- each and 3,000,000 10% convertible preference
          shares of RM 1/- each into 25,000,000 ordinary shares of RM 1/- each during the financial year.

     3.2 Issued & fully paid :
          Ordinary shares of RM 1/- each
          At January 2000                                                                             17,305,690            21,25,13,873             17,305,690
          Issued during the year                                                                       1,082,421              1,32,92,130                       –
          At December 31                                                                              18,388,111            22,58,06,003             17,305,690
     Note : Converted in INR @ RM 1 = Rs. 12.28




                                                                               97
                                                                           JG CONTAINERS (MALAYSIA) SENDIRIAN BERHAD
                                                                                                                     (INCORPORATED IN MALAYSIA)


4. SHARE REDEMPTION RESERVE
     This represents funds set aside from the profits for the year ended June 30, 1996 for the redemption of 10% convertible Redeemable cumulative
     preference shares. 2,250,000 convertible Redeemable Cumulative preference shares of RM 1/- each fully paid were redeemed fully before 30.6.1996, out
     of funds represented by the above share redemption reserve.

5. CAPITAL RESERVE
     The balance in this account represents unrealised gains on revaluation of the company’s freehold land is not available for distribution.
6.   TERM LOAN
                                                                                                             2000                                        1999
                                                                                                              RM                       Rs.                RM
     Unsecured                                                                                         2,727,906               3,34,98,686           2,727,906
7.   FIXED ASSETS
     COST VALUATION                        Balance at                                                                                               Balance at
                                            1.1.2000                         Additions                           Disposals                          31.12.2000
                                                 RM                Rs.             RM                  Rs.            RM                     Rs.           RM
     At Valuation
     Land                                   6,588,000      8,09,00,640                 –                                                             6,588,000
     At Cost :
     Factory Building                       4,158,095      5,10,61,407                 –                                                             4,158,095
     Plant and Machinery,
     factory tools and equipment           30,750,612   37,76,17,515         1,186,348       1,45,68,354                                            31,936,960
     Office equipment, furniture
     and fittings                           1,133,965      1,39,25,090          33,630          4,12,976                   –                    –    1,167,595
     Motor Vehicle                            129,557        15,90,960               –                                                                 129,557
                                           42,760,229   52,50,95,612         1,219,978       1,49,81,330                   –                    –   43,980,207

     ACCUMULATED DEPRECIATION
     Factory Building                       2,375,884      2,91,75,855         124,744         15,31,856                                             2,500,628
     Plant and Machinery,
     factory tools and equipment           21,586,281   26,50,79,531         1,822,950       2,23,85,826                                            23,409,231
     Office equipment, furniture
     and fittings                            903,648       1,10,96,797          37,649          4,62,330                   –                    –     941,297
     Motor Vehicle                            86,746        10,65,241           22,041          2,70,663                                              108,787
                                           24,952,559   30,64,17,424         2,007,384       2,46,50,675                   –                    –   26,959,943
                                                  RM                Rs.                                                                                   RM
     Net Book Value                        17,807,670   21,86,78,188                                                                                17,020,264

     The cost of plant and machinery acquired under hire purchase instalment plan amounts to RM 118,000/-
                                                                                    2000                                                                 1999
                                                                                     RM                                   Rs.                             RM
8.   STOCK & WORK - IN - PROCESS
     Finished goods                                                          2,351,260                         2,88,73,473                           3,958,312
     Less : Provision for breakages                                            125,829                           15,45,180                             275,000
                                                                             2,225,431                         2,73,28,293                           3,683,312
     Cullet                                                                    299,984                           36,83,804                             446,561
     Raw materials, packing materials, stores and spares                     1,293,115                         1,58,79,452                           1,147,117
                                                                             3,818,530                         4,68,91,549                           5,276,990

9.   MOULDS AND TOOLS
     At cost                                                                 6,869,711                         8,43,60,051                           6,380,658
     Less : Amortisation upto December 31                                    4,155,716                         5,10,32,192                           3,904,395
     Net book value at December 31                                           2,713,995                         3,33,27,859                           2,476,263


10. TRADE DEBTORS
    Balance at December 31                                                   3,376,477                         4,14,63,138                           4,207,222
     Less : Provision for doubtful debts                                       200,830                           24,66,193                            162,830
                                                                             3,175,647                         3,89,96,945                           4,044,392
Note : Converted in INR @ RM 1 = Rs. 12.28



                                                                              98
JG CONTAINERS (MALAYSIA) SENDIRIAN BERHAD
(INCORPORATED IN MALAYSIA)


                                                                                   2000                                                                  1999
                                                                                    RM                                  Rs.                               RM
11. HIRE PURCHASE CREDITORS
     Payable within the next 12 months                                           37,524                          4,60,795                                    –
     Payable after the next months                                               65,828                          8,08,368                                    –
                                                                              103,352                          12,69,163                                     –


12. BANK OVERDRAFT
     The bank overdrafts and other facilities granted by commercial banks are secured by a fixed charge in respect of the company’s freehold land, building and
     other fixed assets and a floating charge on the company’s stock of finished goods, raw materials stores, book debts and uncalled capital.
     The rate of interest paid during the year ranged from 8.8% to 9.3%.


13. DEFERRED EXPENDITURE
     Preliminary & pre-operation Expenses
     Cost                                                                     757,140                          92,97,679                             757,140
     Less : Amount written off upto 31st December , 2000                      757,140                          92,97,679                             681,426
     Balance at December 31, 2000                                                   Nil                                Nil                             75,714


14. LOSS BEFORE TAXATION
    Loss before taxation is arrived at after charging :
    Directors' remuneration - Current                                         198,450                          24,36,966                             156,216
    Directors' remuneration - Previous year                                    66,581                           8,17,615                                   –
    Auditors' remuneration                                                     14,000                           1,71,920                              14,000
    Depreciation                                                            2,007,384                        2,46,50,676                           2,646,192
    Interest expenses                                                         975,398                        1,19,77,887                           1,099,847
    Hire of equipment                                                         297,567                          36,54,123                             286,386
    Amortisation on moulds and tools                                          251,321                          30,86,222                             400,922
    Provision for bad debts                                                    38,000                           4,66,640                              90,000
    Deferred expenses written off                                              75,714                           9,29,768                             151,428
    Breakages                                                                 353,199                          43,37,284                             275,000

15. TAX LOSSES
     The amount of the future availability of tax losses for which the related tax effects have not been accounted for in any period is about RM 27,000,000
     (1999 - RM 24,000,000), subject to agreement with the Inland Revenue Department.
16. DIVIDENDS ON 10% CONVERTIBLE REDEEMABLE CUMULATIVE PREFERENCE SHARES
     The Directors have not approved for payment the arrears of dividend on preference shares at December 31, 2000 amounting to RM 4,419,746
     (1999 RM 4,419,746). These arrears are not reflected in the accounts.
17. COMPARATIVE FIGURES
     Comparative figures, where appropriate, have been reclassified to conform with the current year’s presentation.


Note : Converted in INR @ RM 1 = Rs. 12.28




                                                                            99
                                             JG CONTAINERS (MALAYSIA) SENDIRIAN BERHAD
                                                                     (INCORPORATED IN MALAYSIA)


Manufacturing, Trading and Profit & Loss Account
FOR THE YEAR ENDED DECEMBER 31, 2000


                                                             2000                             1999
                                             Note             RM                  Rs.          RM

SALES                                                   18,892,689      23,20,02,221    17,485,526
LESS : COST OF GOODS SOLD
Finished goods - January 01                              3,958,312       4,86,08,071     2,193,401
Cost of Production :
Materials consumed                                       8,022,972       9,85,22,096     8,064,567
Production overheads                                     8,457,742      10,38,61,072     9,516,022
                                                        16,480,714      20,23,83,168    17,580,589
                                                        20,439,026      25,09,91,239    19,773,990
Finished Goods - December 31                             2,842,296       3,49,03,395     3,958,312
                                                        17,596,730      21,60,87,844    15,815,678
Cost of bottles purchased                                  32,598           4,00,303        18,778
                                                        17,629,328      21,64,88,147    15,834,456

GROSS PROFIT                                             1,263,360       1,55,14,061     1,651,070


Other Income :
Miscellaneous income                                       28,544           3,50,520        41,172
Creditors balance waived                                     8,082            99,247         2,051

Insurance claims received                                       –                  –        95,238
                                                           36,626           4,49,767       138,461
                                                         1,299,986       1,59,63,828     1,789,531
Distribution costs                               I       1,053,558       1,29,37,692     1,586,056
Administrative expenses                         II       1,673,713       2,05,53,196     1,201,620
Other operating expenses                       III        300,459          36,89,637     1,153,590
Finance cost                                   IV        1,039,327       1,27,62,936     3,941,266

                                                         4,067,057       4,99,43,460    (2,290,195)


Net Loss                                               (2,767,071)      (3,39,79,632)   (2,160,311)


Note : Converted in INR @ Rm 1 = Rs. 12.28




                                               100
JG CONTAINERS (MALAYSIA) SENDIRIAN BERHAD
(INCORPORATED IN MALAYSIA)


Schedule of Expenses
FOR THE YEAR ENDED DECEMBER 31, 2000


                                                             2000                      1999
                                                 Note         RM             Rs.        RM


SCHEDULE I - DISTRIBUTION COST

Commission                                                 54,272      6,66,460      36,079

Discount allowed                                            6,711        82,411      15,172

Entertainment                                               6,883        84,523       3,838

Freight Outwards                                          537,924     66,05,707     465,943

Freight Inwards                                             8,287      1,01,764      15,560

Sales promotion and advertisement                          45,990      5,64,757      29,030

Port Charges                                               16,860      2,07,041      90,000

Travelling and transport                                   10,020      1,23,046           –

Breakages                                                 353,198     43,37,271     275,000

Repairs and maintenance       - Pallets                     3,380        41,506           –

                              - motor vehicles             10,033      1,23,206       8,940

                                                         1,053,558   1,29,37,692    939,562



SCHEDULE II - ADMINISTRATION COST

Auditors remuneration                                      18,175      2,23,189      19,175

General Charges                                            18,245      2,24,049       8,068

Insurance                                                 183,293     22,50,838     193,317

Legal and Professional fees                                81,701     10,03,288      27,313

Medical expenses                                           29,664      3,64,274      16,320

Printing and Stationery                                    31,644      3,88,588      32,723

Salary and allowance                                     1,080,742   1,32,71,512   1,078,769

Security Guard services                                   140,193     17,21,570     143,648

Staff Welfare                                               9,588      1,17,740      66,392

Travelling                                                 39,909      4,90,083      13,058

Staff recruitment                                           3,382        41,531       2,262

Rental                                                     24,000      2,94,720           –

Staff Training                                             13,177      1,61,814           –

                                                         1,673,713   2,05,53,196   1,601,045


Note : Converted in INR @ Rm 1 = Rs. 12.28




                                                   101
                                             JG CONTAINERS (MALAYSIA) SENDIRIAN BERHAD
                                                                    (INCORPORATED IN MALAYSIA)


                                                            2000                           1999
                                             Note            RM                 Rs.         RM

SCHEDULE III - OTHER OPERATING EXPENSES

Newspapers and periodicals                                   167             2,051          593

Quit rent and assessment                                  22,923          2,81,494       22,923

Telephone and fax                                         53,948          6,62,481       49,222

Postage                                                   11,204          1,37,585        8,500

Preliminary expenses w/off                                75,714          9,29,768      151,428

Late fees                                                  7,974            97,921            –

Depreciation                                              42,205          5,18,277            –

Water and electricity                                        468             5,747            –

Bad debts written off                                     47,856          5,87,672       14,015

Sales tax paid                                                 –                 –          388

Provision for doubtful debts                              38,000          4,66,640            –

                                                         300,459         36,89,636      247,069


SCHEDULE IV - FINANCE COST

Bank Charges                                              55,391          6,80,201       53,743

Interest on :

Bills discounted                                         309,330         37,98,572      326,194

Overdraft                                                512,523         62,93,782      551,945

Trust receipt                                             81,432          9,99,985       91,447

Term Loan                                                 17,100          2,09,988       39,900

Others                                                    55,013          6,75,560       90,360

Difference in exchange                                     8,538          1,04,847        8,577

                                                        1,039,327       1,27,62,935    1,162,166




Note : Converted in INR @ Rm 1 = Rs. 12.28




                                              102
BILT TREE TECH LIMITED

Directors’ Report
FOR THE YEAR ENDED 31ST MARCH, 2001                                                       During the year, Messrs. R R Vederah and B Hariharan were appointed as the
                                                                                          Additional Directors of the Company and ceases to be the Directors at the
To The Members                                                                            ensuing Annual General Meeting. Necessary notices in terms of Section 257 of
Your Directors have pleasure in submitting their Twelfth Annual Report on the             the Companies Act, 1956, have been received and the proposals for their
working of the Company together with the Accounts of the Company for the                  appointment as Directors shall be placed at the Annual General Meeting for
financial year ended 31st March, 2001.                                                    the consideration of the shareholders.
                                                                                          In accordance with the provisions of the Companies Act, 1956, and the
FINANCIAL RESULTS                                                                         Company's Articles of Association, Mr Raj Chaurasia retires by rotation at the
                                                 Year ended          Year ended           ensuing Annual General Meeting and is eligible for re-appointment.
                                                 31.03.2001         31.03.2000
                                                       (Rs.)                (Rs.)         DIRECTORS RESPONSIBILITY STATEMENT
Operating profits/(loss) before interest                                                  a) In the preparation of the annual accounts, the applicable accounting
& finance charges and depreciation                2,30,678            2,12,498                standards have been followed along with proper explanation relating to
Less : Interest & Finance Charges                        –                    –               material departures, if any;
Profit/(Loss) before depreciation                 2,30,678            2,12,498            b) The Directors have selected such accounting policies and applied them
Less: Depreciation                                1,64,141            1,90,908                consistently and made judgments and estimates that are reasonable and
                                                                                              prudent so as to give a true and fair view of the state of affairs of the
Profit before tax/(loss) for the year             1,66,537              21,590                Company at the end of the financial year 2000-2001 and of the profit
Provision for Tax of earlier year written back       9,000                    –               of the Company for that period;
Profit after tax                                         –                    –           c) The Directors have taken proper and sufficient care for the maintenance
Profit after tax/(loss) for the year              1,75,537              21,590                of adequate accounting records in accordance with the provisions of the
                                                                                              Act for safeguarding the assets of the Company and for preventing and
Profit/(loss) till the previous year           (68,06,937)          (68,28,527)
                                                                                              detecting fraud and other irregularities;
Balance Carried to Balance Sheet               (63,31,400)          (68,06,937)
                                                                                          d) The Directors have prepared the Accounts on a going concern basis.
During the year under review, the Company generated operating profit (before              AUDITORS
interest and finance charges and depreciation) of Rs. 2.31 lacs, as compared to           Messrs Price Waterhouse, Chartered Accountants and Statutory Auditors of
Rs. 2.12 lacs generated during the previous year.                                         the Company, have audited the accounts of the Company for the year 2000-
                                                                                          2001 following the prescribed accounting standards. The Report and Notes
OPERATIONS                                                                                to accounts are self-explanatory and therefore, do not call for any further
                                                                                          explanation and/or comment.
CONSULTANCY
                                                                                          Messrs Price Waterhouse would be retiring at the conclusion of the forthcoming
The consultancy arrangement with M/s. Ballarpur Industries Limited (BILT)                 Annual General Meeting. The Company has received a certificate from the
covered all activities of forestry and raw material operations and co-ordination.         Statutory Auditors to the effect that their appointment, if made, would be
12.40 lacs good quality seedlings were produced and utilised during the year              within the prescribed limits under Section 224(1-B) of the Companies Act,
under review. The distribution of pulp wood seedlings to farmers initiated in             1956. Accordingly, the members are requested to consider their re-
previous years is being expanded and significantly higher number of seedlings             appointment, at a remuneration to be decided by the Board of Directors.
will be distributed to farmers for increasing growing stocks of pulp wood in the
catchment areas of all the paper mills of Ballarpur Industries Limited.                   INFORMATION PURSUANT TO SECTION 217 (1) (E) OF THE
                                                                                          COMPANIES ACT, 1956
The Company initiated R&D programme of eucalyptus clone development at
BILT Unit Chowdwar during 1997-98 is progressing well. Similar activities are             Since the Company did not carry out any manufacturing activities during the
being duplicated at all other units of Ballarpur Industries Limited. These high           year, there is no information with regard to Conservation of Energy and
yielding clones will be multiplied and supplied to farmers in the vicinity of BILT        Technology Absorption to be given under this head.
Pulp & Paper Units to increase productivity on farmers land for wood                      Further no foreign exchange was earned or spent by the Company during the
production.                                                                               year.
The R&D projects reported earlier progressed satisfactorily, including the                INFORMATION PURSUANT TO SECTION 217 (2A) OF THE
Flowered bamboo areas that are showing improvement at Unit Ballarpur.                     COMPANIES ACT, 1956
However, the final analysis/ results should be available in 2003.
                                                                                          There was no employee in the Company, who if employed throughout the
WOOD TRADING                                                                              year, was in receipt of remuneration of Rs. 12,00,000/- per annum and above
Your Company plans to enter wood trading through supply contracts.                        and if employed for a part of the year, was in receipt of remuneration of
Arrangements are in hand for complying with statutory provisions and                      Rs.100,000/- per month and above. The particulars, as required by Section
commence the activities during current financial year. This will add to the               217(2A) of the Companies Act, 1956 read with Companies (Particulars of
turnover of the company and is expected to improve the profitability in long              Employees) Rules, 1975, have accordingly not been furnished.
term.                                                                                     ACKNOWLEDGMENTS
AGRO FORESTRY                                                                             Your Directors wish to place on record the active, dedicated and valuable
At the Hundewala nursery 379750 Eucalyptus seedlings and 50954 Poplar                     contribution of the Company's personnel at all levels in achieving the results in
ETPs were raised and sold successfully. Nursery operations are in advanced                the operations of the Company during the year.
stage for raising the requisite number of Eucalyptus seedlings and ETPs. Order            Your Directors further express their thanks to the Banks, Institutions and
booking for Euca seedlings for sale in August/September 2001 is in hand and               other concerned agencies for their continued cooperation extended to the
order for approximately 10 lac plants is targeted. Poplar ETP sale target for             Company from time to time.
the next year is 30000.
DIRECTORS                                                                                                                       For and on behalf of Board of Directors
Messrs Gautam Thapar and V M Thapar had resigned from the Directorship
of the Company. Your Board places on record its appreciation of the services                                                                              Raj Chaurasia
rendered by Messrs Gautam Thapar and V M Thapar during their association                  Place : New Delhi                                                B Hariharan
with the Company.                                                                         Dated : June 8, 2001                                                  Directors


                                                                                    103
                                                                                                                                 BILT TREE TECH LIMITED


Auditors' Report
To The Members of                                                                               viii)    The Company has not granted any loans, secured or unsecured
BILT Tree Tech Limited                                                                                   to Companies, firms or other parties listed in the register
                                                                                                         maintained under Section 301 of the Act.
1.   We report that we have audited the Balance Sheet of Bilt Tree Tech
     Limited as at 31st March, 2001 and the relative Profit and Loss Account                    ix)      The Company has not granted any loans or advances in nature of
     for the year ended on that date, both of which we have signed under                                 loans.
     reference to this report and the above mentioned accounts are in                           x)       In our opinion, there is an adequate internal control procedure
     agreement with the books of account.                                                                commensurate with the size of the Company and nature of its
2.   In our opinion and to the best of our information and according to the                              business, for purchase of stores, plant and machinery, equipment
                                                                                                         and similar assets and for the sale of goods.
     explanations given to us, the Balance Sheet and Profit and loss Account
     together with Notes thereon/attached thereto and the Statement on                          xi)      The Company has not purchased goods and materials aggregating
     Significant Accounting Policies give, in the prescribed manner the                                  Rs.50,000 or more in value from any of the parties listed in the
     information required by 'The Companies Act, 1956', of India ( the 'Act'),                           register maintained under Section 301 of the Act. In respect
     and also give respectively, a true and fair view of the state of the Company's                      of transactions of sale of goods, materials and services by the
     affairs as at 31st March, 2001, and its profit for the year ended on that                           Company, made in pursuance of contracts or arrangements
     date.                                                                                               entered in the register maintained under Section 301 of the Act
                                                                                                         and aggregating during the year Rs.50,000 or more in value in
3.   We have obtained all the information and explanations which, to the best                            respect of each party have been made at prices which are
     of our knowledge and belief, were necessary for our audit. In our opinion,                          reasonable having regard to the prevailing market prices for such
     proper books of account have been kept as required by law so far as                                 goods, material and services or the prices at which transactions
     appears from our examination of the books.                                                          for similar goods or services have been made with other parties.
4.   In our opinion, these accounts have been prepared in compliance with                       xii)     The Company has a system of determining unserviceable or
     the applicable accounting standards referred to in Section 211 (3C) of                              damaged stores on the basis of technical evaluation and on such
     the Act.                                                                                            basis, in our opinion, adequate amounts have been written off
                                                                                                         such stocks in the accounts.
5.   On the basis of confirmations received from other companies in which
     the Directors of this Company are Directors, and taken on record by                        xiii)    The Company has not accepted any deposits from the public.
     the Board of Directors, we report that none of the Directors is disqualified               xiv)     In our opinion, the present internal audit system of the Company
     as on 31st March, 2001, from being appointed as a Director in terms of                              is generally commensurate with its size and nature of business.
     clause (g) of sub-section (1) of section 274 of the Act.
                                                                                                xv)      The Central Government of India has not prescribed the
6.   As required by the Manufacturing and Other Companies (Auditor's                                     maintenance of cost records by the Company under Section 209
     Report) Order 1988 dated 7th September, 1988, issued by the Central                                 (1)(d) of the Act, for any of its products.
     Government of India and on the basis of such checks as we considered
     appropriate and according to the information and explanations given to                     xvi)     The Company has generally been regular during the year, in
                                                                                                         depositing Provident Fund dues with the appropriate authorities
     us, we further report that:
                                                                                                         in India.
     i)     a)    The Company has maintained proper records to show full
                                                                                                xvii)    At the last day of the financial year, there were no amounts
                  particulars, including quantitative details and situation of its
                                                                                                         outstanding in respect of undisputed Income Tax, Wealth Tax,
                  fixed assets.                                                                          sales Tax, customs duty and excise duty which were due for more
            b)    The fixed assets of the Company have been physically verified                          than six month from the date they became payable.
                  during the year by the management and no material                             xviii)   During the course of our examination of the books of accounts
                  discrepancies between the book records and physical                                    carried out in accordance with the generally accepted auditing
                  inventory have been noticed.                                                           practices in India, we have not come across any personal expenses
                                                                                                         which have been charged to the Profit and Loss Account, nor
     ii)    The fixed assets of the Company have been not revalued during
                                                                                                         have we been informed of such case by the management other
            the year.
                                                                                                         than those payable under contractual obligations and/or accepted
     iii)   The stock of work in progress and stores of the Company have                                 business practices.
            been physically verified by the management at the year-end.
                                                                                                xix)     The Company is not covered under the definition of a scheduled
     iv)    In our opinion, the procedures of physical verification of stocks                            industry as specified in the first schedule of the Industries
            followed by the management are reasonable and adequate in                                    (Development and Regulation) Act, 1951, and accordingly clause
            relation to the size of the Company and nature of its business.                              (o) section 3(1) of the Sick Industrial Companies (Special Provisions)
                                                                                                         Act, 1985 is not applicable.
     v)     The discrepancies between the physical stocks and the book
            stocks, which have been properly dealt with the books of account,                   xx)      The remaining clauses of the Order are either not applicable or
                                                                                                         relevant to the Company and accordingly we have not reported
            were not material.
                                                                                                         on matters specified in such clauses.
     vi)    In our opinion, the valuation of work in progress and stores has
            been fair and proper in accordance with the normally accepted
            accounting principles in India and is on the same basis as in the
                                                                                                                                                                 J K JAIN
            preceding year.
                                                                                                                                                                    Partner
     vii)   The Company has not taken any loans, secured or unsecured,                                                                                For and on behalf of
            from companies, firms or other parties listed in the register                   Place : New Delhi                                      PRICE WATERHOUSE
            maintained under section 301 of the Act.                                        Dated : June 8, 2001                                     Chartered Accountants




                                                                                      104
BILT TREE TECH LIMITED

Balance Sheet
AS AT 31ST MARCH, 2001

                                         Schedule                             As at                                    As at
                                                                   31st March, 2001                        31st March, 2000
                                                                                 Rs.                                     Rs.

SOURCES OF FUNDS
Share Capital                              'A'                          1,08,00,000                               1,08,00,000

                                                                        1,08,00,000                               1,08,00,000


APPLICATION OF FUNDS
FIXED ASSETS
Gross Block                                'B'                            44,62,774                                 44,62,774
Less: Depreciation                                                        33,22,041                                 31,57,900

Net Block                                                                 11,40,733                                 13,04,874


CURRENT ASSETS, LOANS AND ADVANCES
Inventories                                'C'                            12,32,409                                  5,20,801
Sundry Debtors                             'D'                             2,03,956                                 20,15,590
Cash & Bank Balances                       'E'                             2,27,387                                  3,03,717
Loans & Advances                           'F'                               87,400                                  2,61,400

                                                                          35,84,152                                 31,01,508

LESS: CURRENT LIABILITIES & PROVISIONS
Current Liabilities                        'G'                             4,19,361                                  3,30,156
Provisions                                 'H'                             1,36,924                                     83,163

Net Current Assets                                                        30,27,867                                 26,88,189

PROFIT & LOSS ACCOUNT                                                     66,31,400                                 68,06,937

                                                                        1,08,00,000                               1,08,00,000

Significant Accounting Policies and
Notes to Accounts                          'M'




This is the Balance Sheet referred to                                                  The Schedules referred to above form
in our report of even date                                                               an integral part of the Balance Sheet



                                           J K JAIN                                    For and on behalf of the Board
                                           Partner
                                           For and on behalf of
Place : New Delhi
Dated : June 8, 2001
                                           PRICE WATERHOUSE
                                           Chartered Accountants
                                                                                       B HARIHARAN
                                                                                       RAJ CHAURASIA         }   Directors




                                                    105
                                                                                          BILT TREE TECH LIMITED

Profit and Loss Account
FOR THE YEAR ENDED 31ST MARCH, 2001

                                                 Schedule                  For the year ended                    For the year ended
                                                                            31st March, 2001                      31st March, 2000
                                                                                          Rs.                                    Rs.

INCOME
Sales                                                                              10,60,949                               11,40,477
Other Income (Interest on refund                                                      28,010                                         0
of advance tax)

                                                                                   10,88,959                               11,40,447

EXPENDITURE
Nursery Production Expenses                         'I'                            13,59,868                                 7,93,332
(Increase)/Decrease in work in
progress and finished goods                        'L'                            (7,45,733)                                   57,505
Payment to and Provision for employees              'J'                               71,218                                   58,495
Administration and other expenses                  'K'                                72,928                                   18,197
Depreciation                                                                        1,64,141                                 1,90,908


Profit before Tax                                                                   1,66,537                                   21,590
Provision for Tax of earlier year written back                                         9,000                                         0
Provision for Tax                                                                          0                                         0

Profit after Tax                                                                    1,75,537                                   21,590
Accumulated Loss brought forward                                                 (68,06,937)                              (68,28,527)

Balance carried to Balance Sheet                                                 (66,31,400)                              (68,06,937)


Significant Accounting Policies and
Notes to Accounts                                  'M'


This is the Profit & Loss Account referred to                                                 The Schedules referred to above form
in our report of even date                                                              an integral part of the Profit & Loss Account



                                                   J K JAIN                                     For and on behalf of the Board
                                                   Partner
                                                   For and on behalf of
Place : New Delhi
Dated : June 8, 2001
                                                   PRICE WATERHOUSE
                                                   Chartered Accountants
                                                                                                B HARIHARAN
                                                                                                RAJ CHAURASIA        }   Directors




                                                            106
BILT TREE TECH LIMITED


Schedules

                                                                                                           As at                                   As at
                                                                                                31st March, 2001                       31st March, 2000
                                                                                                              Rs.                                    Rs.

SCHEDULE 'A' : SHARE CAPITAL

Authorised :
     2000000 Equity Shares of Rs.10/- each                                                            2,00,00,000                           2,00,00,000

Issued, Subscribed and paid up :
     1080000 Equity Shares Rs.10/- each                                                               1,08,00,000                           1,08,00,000

     990000 Equity Shares of Rs.10/- each are held by
     Ballarpur Industries Ltd. the holding Company.                                                   1,08,00,000                           1,08,00,000
     (Previous year 990000 Equity Shares of Rs. 10/- each)


SCHEDULE 'B' : FIXED ASSETS
(Refer note 1 (i&ii) on schedule "M")

                                                  GROSS BLOCK                              DEPRECIATION                                NET BLOCK
                                      As at     Additions   Deletions/     As at        As at        For     On Sales      As at      As at       As at
 PARTICULARS                       1st April       during     Adjust-       31st          1st        the      Adjust-       31st       31st        31st
                                      2000       the Year      ments      March         April       Year     ments &      March,     March,      March
                                                               during      2001         2000                  Dispo-       2001       2001        2000
                                                             the year                                            sals
                                          Rs.         Rs.          Rs.        Rs.         Rs.        Rs.          Rs.         Rs.        Rs.        Rs.
 BUILDINGS                        7,87,391             0            0    7,87,391    4,35,750    30,796            0     4,66,546   3,20,845   3,51,641
 PLANT, MACHINERY
 & EQUIPMENT                    33,87,495       5,18,862    5,18,862 33,87,495      24,48,853   1,28,160           0    25,77,013   8,10,482   9,38,642
 COMPUTER
 MACHINERY                        2,14,570             0            0    2,14,570    2,04,594     3,990            0     2,08,584     5,986       9,976
 FURNITURE, FIXTURES
 AND OTHER                             14,524          0            0     14,524      14,524          0            0      14,524           0          0
 VEHICLES                              58,794   2,85,796    2,85,796      58,794      54,179      1,195            0      55,374      3,420       4,615

                                44,62,774       8,04,658    8,04,658 4,462,774      31,57,900   1,64,141           0    33,22,041 11,40,733 13,04,874

 Previous Year                  44,62,774              0            0 4,462,774     29,66,992   1,90,908           0    31,57,900

SCHEDULE 'C' : INVENTORIES
(Refer note 1 (iii) on Schedule "M")
                                                                                                           As at                                   As at
                                                                                                31st March, 2001                       31st March, 2000
                                                                                                              Rs.                                    Rs.
Plantation Work in Progress                                                                                10,07,112                            2,61,379
Stores                                                                                                      2,25,297                            2,59,422
                                                                                                           12,32,409                            5,20,801

SCHEDULE 'D' : SUNDRY DEBTORS*
(Unsecured, Considered good)
Debts outstanding for a period exceeding six months                                                         2,73,314                            8,30,917
Other debts                                                                                                17,63,642                           11,84,673
                                                                                                           20,36,956                           20,15,590

*Includes Rs. 19,88,906 due from Ballarpur Industries Ltd.,
the holding Company.
(Previous year Rs. 20,11,865)




                                                                             107
                                                                                              BILT TREE TECH LIMITED

SCHEDULE 'E' : CASH AND BANK BALANCES
                                                                                          As at                       As at
                                                                               31st March, 2001           31st March, 2000
                                                                                             Rs.                        Rs.

    Cash in hand                                                                          3,395                      9,370
    Balances with Scheduled Bank on Current Account                                    2,23,992                   2,94,347

                                                                                       2,27,387                   3,03,717

SCHEDULE 'F' : LOANS AND ADVANCES
(Unsecured, considered good)
    Advances recoverable in cash or in kind for value to be received.                    87,400                   1,12,400
    Tax deducted at source                                                                    –                   1,49,000
                                                                                         87,400                   2,61,400

SCHEDULE 'G' : CURRENT LIABILITIES
    Sundry Creditors                                                                   2,89,513                   2,38,393
    Other Liabilities                                                                  1,29,848                     91,763
                                                                                       4,19,361                   3,30,156

SCHEDULE 'H' : PROVISIONS

    Provision for Gratuity                                                             1,36,924                     83,163

                                                                                       1,36,924                     83,163

SCHEDULE 'I' : NURSERY PRODUCTION EXPENSES
                                                                              For the year ended         For the year ended
                                                                               31st March, 2001           31st March, 2000
                                                                                             Rs.                         Rs.

    Agro-Forestry (Include Labour expenses Rs. 396108                                  9,16,427                   4,56,944
      .Y.                                              .Y.
    (P Rs. 293284) Repairs and Maintenance Rs. 41215 (P Rs. 54401))
    Power Cost                                                                         1,11,024                     55,944
    Salary and Wages                                                                   1,72,817                   1,18,619
    Staff Welfare                                                                        16,342                     16,320
    Contribution to Provident and other funds                                            11,998                      8,637
    Lease Rentals                                                                        58,473                     58,473
    Rates and Taxes                                                                       5,580                      6,275
    Travelling                                                                           15,405                      2,504
    Telephone & Telex                                                                     9,354                      6,619
    Vehicle Running                                                                      19,628                     16,428
    Repair and Maintenance- Machinery                                                       995                      2,637
    Insurance                                                                             6,393                      7,097
    Miscellaneous                                                                        15,432                     36,835

                                                                                      13,59,868                   7,93,332

SCHEDULE 'J' : PAYMENT TO & PROVISIONS FOR EMPLOYEES

    Salaries, Wages & Allowances                                                      12,38,551                   9,26,327
    Contribution to Provident and other funds                                          1,13,863                     99,801
    Staff Welfare                                                                      1,78,848                   1,70,779
    Less-Recovery made*                                                               14,60,044                  11,37,962
                                                                                         71,218                     58,945




                                                                        108
BILT TREE TECH LIMITED

SCHEDULE 'K' : ADMINISTRATION & OTHER EXPENSES
                                                                                                       For the year ended                         For the year ended
                                                                                                        31st March, 2001                           31st March, 2000
                                                                                                                      Rs.                                         Rs.
     Travelling                                                                                                         476                                    1,822
     Printing & Stationary                                                                                                 0                                   1,782
     Professional                                                                                                    33,000                                    1,050
     Auditor's Remuneration
     – Audit Fee                                                                                                     30,000                                   30,000
     – Out of pocket                                                                                                  3,476                                    2,300
     – Other Services                                                                                                 2,918                                    5,000
     Miscellaneous                                                                                                    8,019                                   19,229
     Less-Recoveries made*                                                                                            4,961                                   42,986

                                                                                                                     72,928                                   18,197


*During the year the Company shared services of some its employees with another company. Consequently, the value of share of costs attributable to that
company calculated in accordance with the terms of the agreement.


SCHEDULE 'L' : (INCREASE)/DECREASE IN WORK
IN PROGRESS AND FINISHED GOODS

     Opening Stock:
             Work in Progress                                                                                      2,61,379                                3,18,884

                                                                                                                   2,61,379                                3,18,884

     Less:
     Closing Stock:
             Work in Progress                                                                                    10,07,112                                 2,61,379

                                                                                                                 (7,45,733)                                   57,505




SCHEDULE 'M' : SIGNIFICANT ACCOUNTING POLICIES AND NOTES TO ACCOUNT

1.   SIGNIFICANT ACCOUNTING POLICIES
     i)      Fixed Assets
             Fixed assets are stated at their original cost including freight, duties, taxes and other incidental expenses related to acquisition and installation.
     ii)     Depreciation
             Depreciation on fixed assets is provided on written down value method in accordance with Schedule-XIV to the Companies Act, 1956. Assets
             costing less than Rs. 5000/- each are fully depreciated in the year of purchase.
     iii) Inventories
             Inventories are valued at lower of cost and net realisable value. Cost of stores is on FIFO basis
     iv) Retirement benefits
             a)   Provision for Gratuity has been made in the books on the basis of actuarial valuation as on the Balance Sheet date.
             b)   Liability towards leave encashable at the time of retirement (precisely, leave balance under retirement leave reserve as per Company's service
                  rules) has been provided on the basis of actuarial valuation on the Balance Sheet date for those employees who have balance leave under
                  retirement leave reserve at that date.
2.   Certain land have been taken on Lease and the future obligation for the rentals under the lease amounts to Rs.162133 (Previous year Rs.220606)




                                                                                  109
                                                                                                                   BILT TREE TECH LIMITED

3     Particulars in respect of Production, Stock and Sales
      Production                                                                                         2000-2001                   1999-2000
      Eucalyptus Seedlings (Numbers)*                                                                      3,79,750                    5,00,000
      Poplar Plants (Numbers)**                                                                              50,954                      48,804
      Sales
      Eucalyptus Seedlings (Numbers)                                                                       2,62,140                    3,99,720
                                                                                                       Rs. 7,20,885                Rs. 10,11,292

      Poplar Plants (Numbers) ***                                                                            42,508                      18,455
                                                                                                       Rs. 3,40,064                 Rs. 1,29,185


       * Includes 117610 destroyed. (Previous Year 100280)
      ** Includes 3156 utilised in multiplication during the year (Previous Year 3331) and 5290 destroyed (Previous year 24618).
     *** Includes NIL distributed free of cost (Previous Year 2400)
4.    Stores Consumed during the year Rs.460364 (100% Indigenous) (Previous Year Rs.98305)
5.    Previous Year's figures have been regrouped/rearranged wherever necessary to conform with current year figures.




                                                                            110
BILT TREE TECH LIMITED

BALANCE SHEET ABSTRACT AND COMPANY'S GENERAL BUSINESS PROFILE

I.     REGISTRATION DETAILS :

       Registration No. :                     0   3    4   9   4   2        State Code :     5     5

       Balance Sheet Date :                   3   1        0   3       2   0     0 1
                                               Date        Month            Year

II.    CAPITAL RAISED DURING THE YEAR :

       Public Issue :                         N    I   L                    Rights Issue :                           N    I   L

       Bonus Issue :                          N    I   L                    Private Placement :                      N    I   L

III.   POSITION OF MOBILISATION AND DEPLOYMENT OF FUNDS : (Amount in Rs.)

       Total Liabilities :            1   1   3   5    6   2   8   5        Total Assets :                   1   1    3   5   6   2   8   5

       SOURCES OF FUNDS:

       Paid-Up Capital :              1   0   8   0    0   0   0   0        Reserves & Surplus :                     N    I   L

       Secured Loans :                        N    I   L                    Unsecured Loans :                        N    I   L

       APPLICATION OF FUNDS:

       Net Fixed Assets :                 1   1   4    0   7   3   3        Investments :                            N    I   L

       Net Current Assets :               3   0   2    7   8   6   7        Misc. Expenditure :                      N    I   L

       Accumulated Losses :               6   6   3    1   4   0   0

IV.    PERFORMANCE OF COMPANY: (Amount in Rs.)

       Turnover :                         1   0   8    8   9   5   9        Total Expenditure :                       9   2   2   4   2   2

       Profit/ Loss before Tax :              1   7    5   5   3   7        Profit/Loss after Tax :                   1   7   5   5   3   7

       Earning Per Share in Rs.                            .   1   6        Dividend Rate (%) :                      N    I   L

V.     GENERIC NAMES OF THREE PRINCIPAL PRODUCTS/SERVICES OF COMPANY : (as per monetary terms)

       Item Code No. (ITC Code)       6   0   1   2    0   .   0   9

       Product Description            S   E   E   D    L   I   N G     /    P    L   A N T         S


       Item Code No. (ITC Code)

       Product Description




Note : For ITC code of Products, please refer to the publication Indian Trade Classification based on harmonised commodity description and coding system
       by Ministry of Commerce, Directorate General of Commercial intelligence & Statistics, Calcutta - 700 001.




                                                                           111
                                                                                                   THE PAPERBASE COMPANY LIMITED


Directors’ Report
FOR THE YEAR ENDED 31ST MARCH, 2001

To
The Members,
Your Directors are here with submitting the Sixth Annual Report together with the Accounts of the Company for the year ended 31st March, 2001.

FINANCIAL RESULTS
                                                                                                                    Year ended                     Year ended
                                                                                                                 March 31, 2001                March 31, 2000
                                                                                                                           (Rs.)                          (Rs.)
Sales & Other Income                                                                                                     595,876                     4,099,874
Loss before depreciation & Preliminary
Expenses written off                                                                                                (45,388,024)                   (7,007,503)
Add :Depreciation                                                          1,713,641         4,216,826
     Preliminary Exp.                                                         17,456             17,456
     Written off                                                                                                       1,731,097                     4,234,282
Loss for the year                                                                                                   (47,119,121)                  (11,241,785)
Add : Loss brought forward
      from previous year                                                                                            (52,624,717)                  (41,382,932)

Balance carried to Balance Sheet                                                                                    (99,743,838)                  (52,624,717)

OPERATIONS
During the year under review, the Company had disposed off the whole of the assets, being industrial undertaking comprising of plant and machinery and other
assets and liabilities pertaining to the undertaking, as a going concern, for a consideration of Rs. 75 lacs.
Consequent to the sale, it has been decided to explore the avenues in marketing and distribution network in the paper segment. With this object in view, the
Company has requested Ballarpur Industries Limited (BILT), the holding Company, to undertake the exercise of identifying new and improved marketing and
distribution network. In view of the heavy expenditure involved in undertaking a study of such magnitude, it has been considered appropriate to bear the expenses
on cost-to-cost basis. Accordingly, the Company has borne expenditure towards delegation, travelling and other expenses, which were specifically incurred by
BILT in respect of the exploration of new marketing and distribution services.
The Directors are of the view that the initial exercise undertaken in this regard will enable the Company to firm up the new business opportunities in the short
term and will yield the desired results.

DIRECTORS
Messrs S K Khandelwal and V M Thapar had resigned from the Directorship of the Company. Your Board places on record its appreciation of the services
rendered by Mr Khandelwal and Mr Thapar during their association with the Company.
Mrs Neerja Sharma and Mr Sudhir Mathur were appointed as the Additional Directors of the Company and ceases to be the Directors at the ensuing Annual
General Meeting. Necessary notices in terms of Section 257 of the Companies Act, 1956, have been received and the proposals for their appointment as
Directors shall be placed at the Annual General Meeting for the consideration of the shareholders.
In accordance with the provisions of the Companies Act, 1956, and the Company's Articles of Association, Mr R R Vederah retire by rotation at the ensuing
Annual General Meeting and are eligible for re-appointment.

DIRECTORS RESPONSIBILITY STATEMENT
a)   In the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material
     departures, if any;
b)   The Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so
     as to give a true and fair view of the state of affairs of the Company at the end of the financial year 2000-2001 and of the profit of the Company for that
     period;
c)   The Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act for
     safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
d)   The Directors have prepared the Accounts on a going concern basis.




                                                                              112
THE PAPERBASE COMPANY LIMITED

AUDITORS
Messrs VKGN & Associates, Chartered Accountants and Statutory Auditors of the Company, have audited the accounts of the Company for the year 2000-
2001, following the prescribed accounting standards. The Report and Notes to accounts are self-explanatory and therefore, do not call for any further
explanation and/or comment.
Messrs VKGN & Associates would be retiring at the conclusion of the forthcoming Annual General Meeting. The Company has received a certificate from the
Statutory Auditors to the effect that their appointment, if made, would be within the prescribed limits under Section 224(1-B) of the Companies Act, 1956.
Accordingly, the members are requested to consider their re-appointment, at a remuneration to be decided by the Board of Directors.

INFORMATION PURSUANT TO SECTION 217(1)(e) OF THE COMPANIES ACT, 1956
Since the Company did not carry out any manufacturing activities during the year, there is no 'information with regard to Conservation of Energy and Technology
Absorption to be given under this head.
Further no foreign exchange was earned or spent by the Company during the year.

INFORMATION PURSUANT TO SECTION 217(2A) OF THE COMPANIES ACT, 1956
There was no employee in the Company, who if employed throughout the year, was in receipt of remuneration of Rs. 12,00,000/- per annum and above and
if employed for a part of the year, was in receipt of remuneration of Rs. 100,000/- per month and above. The particulars, as required by Section 217(2A) of the
Companies Act, 1956, read with Companies (Particulars of Employees) Rules, 1975, have accordingly not been furnished.

ACKNOWLEDGMENTS
Your Directors are thankful to all the concerned agencies associated with the Company for the continued support and co-operation.




                                                                                                                      For and on behalf of Board of Directors




                                                                                                                                             R R VEDERAH
Place : New Delhi                                                                                                                         NEERJA SHARMA
Dated : 21st June, 2001                                                                                                                            Directors




                                                                             113
                                                                                                       THE PAPERBASE COMPANY LIMITED

Auditors' Report

TO THE MEMBERS OF                                                                     ANNEXURE TO AUDITORS' REPORT
THE PAPERBASE COMPANY LIMITED                                                         (Referred to in paragraph 1 of Report of even date)

                                                                                      1.   The Company has maintained proper records showing full particulars
We have audited the attached Balance Sheet of THE PAPERBASE COMPANY
                                                                                           including quantitative details and situation of fixed assets. These assets
LIMITED as at March 31, 2001, and the annexed Profit & Loss Account of the
                                                                                           have been physically verified by the management during the year in a
Company for the year ended on that date and report that:
                                                                                           phased manner which in our opinion is reasonable having regard to the
1.   As required by the Manufacturing and Other Companies (Auditor's Report)               size of the Company and the nature of its business. No discrepancies
     Order, 1988, issued by the Central Government in terms of Section 227                 between the book records and the physical inventory were noticed on
     (4A) of the Companies Act, 1956, and on the basis of such checks as we                such verification.
     considered appropriate and according to the information and explanations
                                                                                      2.   The fixed assets of the Company have not been revalued during the year.
     given to us, we give in the Annexure a statement on the matters specified
     in paragraphs 4 and 5 of the said Order, to the extent applicable.               3.   As explained to us, the stocks of raw materials, consumable, stores,
                                                                                           spare parts and finished goods have been physically verified by the
2.   Further to our comments in the Annexure referred to in para 1 above
                                                                                           management at reasonable intervals in accordance with the perpetual
     and subject to the notes to accounts, we state that:
                                                                                           inventory programme. In our opinion, the frequency of such verification
     a)   we have obtained all the information and explanations which to the               is reasonable having regard to the size of the Company and the nature of
          best of our knowledge and belief were necessary for the purposes of              its business.
          our audit;
                                                                                      4.   In our opinion and according to the information and explanations given to
     b)   in our opinion, proper books of account as required by law have                  us, the procedures of physical verification of stocks followed by the
          been kept by the Company so far as appears from our examination                  management are reasonable and adequate in relation to size of the
          of such books;                                                                   Company and the nature of its business.

     c)   the Balance Sheet and the Profit & Loss Account dealt with by this          5.   The discrepancies noticed on physical verification between the book
          report are in agreement with the books of account;                               records and the physical stock of items verified, which were not material,
                                                                                           have been properly dealt with in the books of account.
     d)   in our opinion, the Profit & Loss Account and the Balance Sheet
          comply with the Accounting Standards referred to in sub-section             6.   In our opinion, the valuation of stocks is fair and proper in accordance
          (3C) of section 211 of the Companies Act, 1956;                                  with the normally accepted accounting principles and is on the same basis
                                                                                           as in the preceding year.
     e)   on the basis of the written representations received from the
          Directors as on 31st March, 2001, and taken on record by the                7.   The Company has not taken any loans, secured or unsecured from any
          Board of Directors, we report that none of the Directors is                      companies, firms or other parties listed in the register maintained under
          disqualified as on 31st March, 2001, from being appointed as a                   Section 301 of the Companies Act, 1956, and/or the companies under
          Director in terms of clause (g) of sub-section (1) of section 274 of             the same management within the meaning of Section 370 (1B) of the
          the Companies Act, 1956; and                                                     Companies Act, 1956.

     f)   in our opinion and to the best of our information and according to          8.   The Company has not granted any loans, secured or unsecured to
          the explanations given to us, the said accounts give the information             companies, firms and other parties listed in the Register maintained under
          required by the Companies Act, 1956, in the manner so required,                  Section 301 of the Companies Act, 1956, and/or to the companies
          and gives a true and fair view;                                                  under the same management within the meaning of Section 370 (1B) of
                                                                                           the Companies Act, 1956.
          i)    in the case of the Balance Sheet of the state of affairs of the
                Company as at March 31, 2001; and                                     9.   The Company has not given any loans or advances in the nature of loans
                                                                                           to any party.
          ii)   in the case of the Profit & Loss Account of the loss for the year
                ended on that date.                                                   10. In our opinion and according to the information and explanations given to
                                                                VIJAY GUPTA                us, there are adequate internal control procedures commensurate with
                                                                   FCA-81986               the size of the Company and the nature of its business with regard to
Place : New Delhi                                    VKGN & ASSOCIATES                     purchase of stores, raw materials, including components, plant and
Dated: June 21, 2001                                     Chartered Accountants             machinery, equipments, and other assets, and for the sale of goods.




                                                                                114
THE PAPERBASE COMPANY LIMITED

11. There are no transactions of purchase of goods and materials, and sale of       17. We are informed that the Employees State Insurance Act, 1948, is not
     goods, materials and services aggregating during the year to Rs. 50,000            presently applicable to the Company. The Company has been regular in
     or more in respect of each party in pursuance of contracts or arrangements         depositing the provident fund dues with the appropriate authority.
     entered in the Register maintained under Section 301 of the Companies
                                                                                    18. There were no undisputed amounts payable in respect of Income Tax,
     Act, 1956.
                                                                                        Wealth Tax, Sales Tax, Custom Duty and Excise Duty which have
12. As explained to us, the Company has a regular procedure for the                     remained outstanding as at March 31, 2001, for a period of more than
     determination of unserviceable or damaged stores, raw materials or                 six months from the date they became payable.
     finished goods. Adequate provision has been made in the accounts for
                                                                                    19. According to information and explanations given to us, no personal
     the loss arising on the items so determined.
                                                                                        expenses of employees or directors have been charged to revenue
13. The Company has not accepted deposits from the public and, therefore,               account, other than those payable under contractual obligations or in
     the provisions of Section 58A of the Companies Act, 1956, and the                  accordance with generally accepted business practices.
     Companies (Acceptance of Deposit) Rules, 1975 are not applicable.
                                                                                    20. The Company is not a sick industrial company with the meaning of
14. In our opinion, reasonable records have been maintained by the Company              clause (o) of sub-section (1) of Section 3 of the Sick Industrial Companies
     for the sale and disposal of realisable scraps, wherever applicable. The           (Special Provisions) Act, 1985.
     Company's operation do not generate any by-products.

15. In our opinion, the Company has an adequate internal audit system
     commensurate with the size and nature of its business.
                                                                                                                                                  VIJAY GUPTA
16. The Central Government has not prescribed maintenance of cost records                                                                            FCA-81986
     under section 209(1)(d) of the Companies Act, 1956, in respect of the          Place : New Delhi                                  VKGN & ASSOCIATES
     products manufactured by the Company.                                          Dated: June 21, 2001                                   Chartered Accountants




                                                                              115
                                                                                                 THE PAPERBASE COMPANY LIMITED

Balance Sheet
AS AT 31ST MARCH, 2001
                                                                                                            As at                                  As at
                                                                                                 31st March, 2001                      31st March, 2000
                                                              SCHEDULE                                        Rs.                                    Rs.
SOURCES OF FUNDS
1.   Shareholders’ funds :
     (a)   Share Capital                                           ‘A’                                   40,000,000                          40,000,000
     (b) Share Application money pending allotment                                                               –                             7,401,432
     (c)   Reserves & Surplus                                      ‘B’                                   30,000,000                          30,000,000

                                                                                                         70,000,000                          77,401,432

APPLICATION OF FUNDS :
1.   Fixed Assets
     (a)   Gross Block                                             ‘C’                       –                            86,600,769
           Less : Depreciation                                                               –                            14,691,644
           Net Block                                                                                             –                           71,909,125
     (Refer Note 2 on Notes to Accounts)

2.   Current Assets, Loans & Advances
     (a)   Inventories                                             ‘D’                       –                               549,231
     (b) Sundry Debtors                                            ‘E’                   1,617                             2,161,683
     (c)   Cash & Bank Balances                                    ‘F’               1,304,470                             2,854,297
     (d) Loans & Advances                                          ‘G’               1,619,277                               114,397
                                                                                     2,925,364                             5,679,608

     Less : Current Liabilities                                    ‘H’              32,756,482                            52,916,754

     Net Current Assets                                                                              (29,831,118)                           (47,237,146)
     Miscellaneous Expenditure
     (to the extent not written off or adjusted)
     –     Preliminary Expenses                                                                             87,280                               104,736
     Profit & Loss Account                                                                               99,743,838                          52,624,717

                                                                                                         70,000,000                          77,401,432

Significant accounting policies & Notes to accounts                ‘I’




The Schedules referred to above form an integral part of the Balance Sheet.


                                                                   In terms of our report of even date        For and on behalf of the Board of Directors


                                                                         VIJAY GUPTA (FCA-81986)                                       R R VEDERAH
Place : New Delhi                                                        VKGN & ASSOCIATES                                          NEERJA SHARMA
Dated : 21st June, 2001                                                  Chartered Accountants                                               Directors




                                                                              116
THE PAPERBASE COMPANY LIMITED

Profit & Loss Account
FOR THE YEAR ENDED 31ST MARCH, 2001

                                                                                                     Year ended                             Year ended
                                                                                               31st March, 2001                       31st March, 2000
                                                              SCHEDULE                                      Rs.                                     Rs.

Income
     Sales                                                                                                437,302                             3,831,033
     Other Income                                                  ‘I’                                    158,574                               268,841
     Increase / (Decrease) in Stock                                ‘II’                                  (549,230)                          (2,577,729)

                                                                                                           46,646                             1,522,145

Expenditure
     Manufacturing Expenses                                       ‘III’                                         –                             5,794,267
     Personnel Expenses                                           ‘IV’                                    253,039                               908,838
     Administration, Selling &
     Miscellaneous Expenses                                        ‘V’                                     48,405                             1,826,543
     Marketing and Distribution network expenses                                                        32,230,015                                     –
     Professional Charges                                                                                 104,450                                      –
     Depreciation                                                                                        1,713,641                            4,216,826
     Preliminary Expenses written off                                                                      17,456                                17,456

                                                                                                        34,367,006                          12,763,930

                                                                                                        34,320,360                          11,241,785
Loss on transfer of Undertaking                                                                         12,798,761                                     –
(Refer Note 2 on Notes to Accounts)
Loss for the year                                                                                       47,119,121                          11,241,785
Add : Loss brought forward from previous year                                                           52,624,717                          41,382,932
Balance carried to Balance Sheet                                                                        99,743,838                          52,624,717


Notes forming part of the
Profit & Loss Account                                             ‘VI’



The Schedules referred to above form an integral part of the Profit & Loss Account.


                                                                  In terms of our report of even date        For and on behalf of the Board of Directors


                                                                          VIJAY GUPTA (FCA-81986)                                     R R VEDERAH
Place : New Delhi                                                         VKGN & ASSOCIATES                                        NEERJA SHARMA
Dated : 21st June, 2001                                                   Chartered Accountants                                             Directors




                                                                             117
                                                                                                                    THE PAPERBASE COMPANY LIMITED

Schedules “A” To “J”
ATTACHED TO AND FORMING PART OF THE BALANCE SHEET AS AT 31ST MARCH, 2001

                                                                                                                                 As at                                           As at
                                                                                                                      31st March, 2001                               31st March, 2000
                                                                                                                                    Rs.                                            Rs.

SCHEDULE “A” - SHARE CAPITAL

Authorised :
      58,00,000 Equity Shares of Rs.10 each                                                                                    58,000,000                                      58,000,000
        7,20,000 Cumulative Redeemable Preference                                                                              72,000,000                                      72,000,000
                 Shares of Rs.100 each

                                                                                                                             130,000,000                                  130,000,000

Issued :
      48,00,000 Equity Shares of Rs.10 each                                                                                    48,000,000                                      48,000,000
        4,20,000 13% Redeemable Non-convertible Cumulative
                 Preference Shares of Rs.100 each                                                                              42,000,000                                      42,000,000
        3,00,000 25% Redeemable Non-convertible Cumulative                                                                     30,000,000                                      30,000,000
                 Preference Shares of Rs.100 each

                                                                                                                             120,000,000                                  120,000,000
Subscribed & Paid up :
      10,00,000 Equity Shares of Rs.10 each fully paid up                                                                      10,000,000                                      10,000,000
        3,00,000 25% Redeemable Non-convertible Cumulative                                                                     30,000,000                                      30,000,000
                 Preference Shares of Rs.100 each fully paid up

                                                                                                                               40,000,000                                      40,000,000

1.   3,00,000 25% Redeemable Non Convertible Cumulative Preference shares of Rs. 100 each were issued on rights basis at a premium
     of Rs. 100 per share. The redemption would be at a premium of Rs. 100 per share and shares are redeemable, at the option of the Company, at any time
     after three years by giving six months notice. The term of the preference shares is 7 years.
     Preference shares carry 5 warrants with each share of Rs.100 entitling them to apply for 5 Equity Shares at any time after six months but before 3 years
     from the date of allotment.
2.   Of the above, 9,99,930 Equity Shares of Rs.10 each and 3,00,000 25% Redeemable Non-Convertible Cumulative Preference shares of Rs.100 each are
     held by Ballarpur Industries Limited, the Holding Company.


SCHEDULE “B” - RESERVES & SURPLUS

     Share Premium Account
     As per last Balance Sheet                                                                                                 30,000,000                                      30,000,000

                                                                                                                               30,000,000                                      30,000,000

SCHEDULE : “C” - FIXED ASSETS
                                                                                                                                                                           Amount in Rs.
                                                                Gross Block                                             Depreciation                                     Net Block
 Description of Assets                          As at     Additions Deduction/      As at                Up to          For the    Adjustments      Up to              As at       As at
                                          01.04.2000                Adjustment 31.03.2001           31.03.2000             Year      Disposals 31.03.2001         31.03.2001 31.03.2000

 Plant & Machinery                        86,537,719               – 86,537,719                –    14,677,675      1,711,237       16,388,912               –             – 71,860,045
 Computers                                     18,050              –      18,050               –          5,074          1,218            6,292              –             –       12,975
 Furniture & Fixtures                          45,000              –      45,000               –          8,895          1,186          10,081               –             –       36,105
 TOTAL                                    86,600,769               – 86,600,769                –    14,691,644      1,713,641       16,405,285               –             – 71,909,125
 Previous year                            91,765,413              –    5,164,644 86,600,769         15,352,194      4,216,826        4,877,376 14,691,644         71,909,126

 Note :- Depreciation for the year represents amounts calculated up to the date of the sale of assets i.e. for the period 1st April, 2000 to 31st August, 2000.




                                                                                           118
THE PAPERBASE COMPANY LIMITED

SCHEDULE “D” - INVENTORIES
(As valued and certified by the Management)

                                                                       As at                As at
                                                            31st March, 2001    31st March, 2000
                                                                          Rs.                 Rs.

Stores & Spares                                                            –              58,909
Finished goods                                                             –            490,322

                                                                           –            549,231

SCHEDULE “E” - SUNDRY DEBTORS
(Unsecured, Considered Good)

Debts outstanding for a period exceeding six months                    1,617           1,277,794
Other Debts                                                                –            883,889

                                                                       1,617           2,161,683


SCHEDULE “F” - CASH AND BANK BALANCES

Cash in hand                                                           2,638               5,838
Bank balances :
With Scheduled Banks in Current Account                              301,832           2,848,459
With Scheduled Banks in Fixed Deposit Account                      1,000,000                   –

                                                                   1,304,470           2,854,297


SCHEDULE “G” - LOANS & ADVANCES
(Unsecured, Considered Good)

Advances, Deposits & Prepaid Expenses
recoverable in cash or in kind or for
value to be received                                               1,594,252            114,397
Income Tax deducted at source                                         25,026                   –

                                                                   1,619,277            114,397



SCHEDULE “H” - CURRENT LIABILITIES

Sundry Creditors                                                  32,098,990         52,895,754
Advance received from Customers                                            –              21,000
Tax Deducted at Source                                               657,492                   –

                                                                  32,756,482         52,916,754




                                                      119
                                                                                                     THE PAPERBASE COMPANY LIMITED

SCHEDULE “I” - SIGNIFICANT ACCOUNTING POLICIES AND NOTES TO ACCOUNTS
1.   Significant accounting policies :
     (a)   Fixed Assets :
           Fixed Assets are stated at their original cost of acquisition including freight, duties, taxes, and other incidental expenses relating to acquisition and
           installation.
     (b) Depreciation :
           Depreciation on Fixed Assets is provided on straight line method in accordance with and at rates specified in Schedule XIV of the Companies Act,
           1956, except in the case of Electric Installation & Improvement to Licensed Premises which are amortized over the period of licence agreement.
     (c)   Miscellaneous Expenditure :
           Preliminary Expenses is written off over a period of 10 years from the year of commercial production.
     (d) Inventory :
           Stocks of Raw Material and Stores & Spares are valued at cost.
           Finished Goods are stated at cost or net realisable value whichever is lower. Stock in Process is valued at cost.
           Scrap is valued at estimated realisable value.
     (e)   Foreign Currency Transactions :
           Transactions in foreign currencies are accounted for at exchange rates prevailing on the dates the transactions take place. Receivable /payable in foreign
           currencies are translated at the exchange rate ruling at the Balance Sheet date. Gains and losses arising out of subsequent fluctuations in exchange rates
           are adjusted in the Profit and Loss Account.
     (f)   Revenue Recognition :
           The financial statements are prepared on accrual basis in accordance with generally accepted accounting principles.
2.   During the year, the Company has sold to the holding company, the undertaking for manufacture of stationery articles on a slump sale basis for a total
     consideration of Rs 75 lacs together with the assets as well as liabilities as a part of slump sale as of 31st August, 2000. The same have been dealt with in
     this account. Accordingly loss arising out of sale of undertaking has been reflected in the profit and loss account.
3.   During the year, the Company has been exploring various alternatives in the marketing and distribution network of paper segment. The Company has
     requested the service of the holding company in the field of delegation, travelling, etc. A sum of Rs 3,22,30,015/- has been incurred in this regard and has
     been dealt in the accounts on cost to cost basis.
4.   Estimated amount of contracts remaining to be executed on Capital Account Rs. Nil (Previous Year Rs. NIL)
5.   Arrear of dividend on 3,00,000 25% Redeemable Non-Convertible Cumulative Preference shares of 100/- each as on 31st March, 2001, amounts to
     Rs.3,12,32,877 (Previous Year Rs.2,37,32,877).
6.   Previous year's figures have been re-arranged and re-grouped wherever necessary to conform to this year's classification.




                                                                                120
THE PAPERBASE COMPANY LIMITED

Schedules “I” To “VI”
ATTACHED TO AND FORMING PART OF THE PROFIT & LOSS ACCOUNT FOR THE YEAR ENDED 31ST MARCH, 2001

                                                                             Year ended               Year ended
                                                                       31st March, 2001         31st March, 2000
                                                                                     Rs.                      Rs.


SCHEDULE “I” - OTHER INCOME

   Scrap Sales                                                                        –                   66,832
   Duty Drawback                                                                      –                   19,177
   Exchange rate fluctuation                                                          –                   21,126
   Interest Received (TDS Rs. 25,026/-. Previous Year Rs. Nil)                  158,574                    2,206
   Profit on sale of asset                                                            –                   12,782
   Refund of Sales Tax                                                                –                 146,718

                                                                                158,574                 268,841


SCHEDULE “II” - INCREASE/(DECREASE) IN STOCK

   Opening Stock :
        Finished Stock                                                          490,322                3,014,458
        Scrap                                                                    58,908                   53,593

                                                                                549,230                3,068,051

   Closing Stock :
        Finished Stock                                                                –                 490,322

   Net Increase/(Decrease) in Stocks                                          (549,230)              (2,577,729)


SCHEDULE “III” - MANUFACTURING EXPENSES

   Raw Material Disposed off                                                          –                2,973,562
   Stores & Spare Parts Consumed                                                      –                   16,771
   Stores & Spare Disposed off                                                        –                   87,856
   Power & Fuel                                                                       –                 337,209
   Repairs - Others                                                                   –                   61,967
   Processing Charges                                                                 –                1,930,055
   Other Expenses                                                                     –                 386,847

                                                                                      –                5,794,267


SCHEDULE “IV” - PERSONNEL EXPENSES

   Salary & Wages                                                               246,349                 881,200
   Staff Welfare Expenses                                                         6,690                   27,638

                                                                                253,039                 908,838




                                                                 121
                                                                                                    THE PAPERBASE COMPANY LIMITED

SCHEDULE “V” - ADMINISTRATION, SELLING & MISCELLANEOUS EXPENSES

                                                                                                           Year ended                                  Year ended
                                                                                                     31st March, 2001                            31st March, 2000
                                                                                                                   Rs.                                         Rs.

     Rent                                                                                                            –                                       47,933
     Insurance Charges                                                                                               –                                      563,356
     Office & Other Expenses                                                                                    10,914                                      459,185
     Travelling & Conveyance                                                                                    23,680                                      117,974
     Vehicle Running & Maintenance                                                                                   –                                       10,543
     Finance Charges                                                                                             3,931                                        6,664
     Carriage & Freight                                                                                          4,880                                       61,941
     Commission & Discount on Sales                                                                                  –                                        1,760
     Machine Packing & Shifting Exp.                                                                                 –                                      540,447
     Other Selling Expenses                                                                                          –                                        4,240
     Payment to Auditors – Audit fee                                                                             5,000                                       10,000
                            – Tax Audit fee                                                                          –                                        2,500

                                                                                                                48,405                                  1,826,543

SCHEDULE “VI” -
A.   Additional information pursuant to the provisions of paragraph (3) to (4D) of part II of Schedule VI of the Companies Act, 1956. :
     1.   Particulars in respect of Licenced & Installed Annual Capacities :
          Class of Goods                                                                       Licenced Capacity*                      Installed Capacity**
                                                                                            As at                As at                 As at                 As at
                                                                                       31.03.2001          31.03.2000             31.03.2001           31.03.2000
          Stationery articles such as exercise                                                 NIL               5200                    NIL        27 Million Nos.
          books, note books, pads, etc., made of                                            Tonnes              Tonnes           of Standard           of Standard
          paper and paper board                                                                                                   Stationery            Stationery
                                                                                                                                     Articles               Articles
          *     Based on maximum utilisation of Plant & Machinery. Denomination of the Licenced Capacity is based on the Letter of Intent given by the
                Government of India. The letter of intent has since expired on 6th December, 1998 . The Company has received IEM (Industrial Entrepreneurs'
                Memorandum) dated 21.05.1999 to set up a printing unit at Daman for printing but not publishing of books, journals, directories, etc., with a
                proposed capacity of 6000 MT.
          **    As per certificate given by the Management, and relied upon by the Auditors, being a technical matter, denomination of the Installed capacity is
                stated by reference to which the goods are ordinarily traded.
     2.   Particulars in respect of Production, Sales, Stock of Finished Goods, & Raw Material consumed :
          (a)   Production and Sales :
                Class of Goods                                                                      Production***                                Sales **
                                                                                       Year ended           Year ended           Year ended             Year ended
                                                                                       31.03.2001          31.03.2000            31.03.2001            31.03.2000
                Stationery articles such as exercise
                books, note books, pads, etc., made of                                        NIL                    NIL         95,545 Nos.         663,156 Nos.
                paper and paper board
                **Net of Nil Nos. ( previous year 4,496 Nos.) of Free Samples.
                ***Processed at a third party's processing unit under licence agreement. Since terminated w.e.f. 15th July, 1999
          (b) Stock of Finished Goods :
                Class of Goods                           Stock as at 31.03.2001             Stock as at 31.03.2000                  Stock as at 31.03.1999
                                               Quantity in Nos.                  Rs.   Quantity in Nos.                    Rs. Quantity in Nos.                 Rs.
                Stationery Articles                           NIL               NIL            115,758              490,322           783,410           3,014,458
          (c)   Analysis of Raw Material Consumed :
                Particulars                                                             Year ended 31.03.2001                     Year ended 31.03.2000
                                                                                 Quantity in M.T.                     Rs.     Quantity in M.T.                  Rs.
                Paper & Paper Board                                                            NIL                   NIL                  NIL                  NIL
                Others                                                                         NIL                   NIL                  NIL                  NIL
                                                                                               NIL                   NIL                  NIL                  NIL




                                                                               122
THE PAPERBASE COMPANY LIMITED

  3.   Value of Imported & Indigenous Raw Materials, Stores & Spare Parts consumed and the percentage of each to the total consumption :


       Particulars                                                                 Year ended 31.03.2001              Year ended 31.03.2000
                                                                                       Rs.    Percentage %                   Rs.     Percentage %
       Raw Materials
                          –     Imported                                               NIL               NIL                NIL                  NIL
                          –     Indigenous                                             NIL               NIL                NIL                  NIL

                                                                                       NIL               NIL                NIL                  NIL

       Stores & Spare parts
                          –     Imported                                               NIL               NIL                NIL                  NIL
                          –     Indigenous                                             NIL               NIL             16,771               100.00

                                                                                       NIL               NIL             16,771               100.00

  4.   Value of Imports on CIF basis in respect of :
       Description                                                                               Year ended                                Year ended
                                                                                                  31.03.2001                           31.03.2000
                                                                                                          Rs.                                     Rs.
       Raw Materials                                                                                     NIL                                     NIL
       Spare Parts & Other Stores                                                                        NIL                                     NIL
       Capital Goods                                                                                     NIL                                     NIL

                                                                                                         NIL                                     NIL

  5.   Expenditure in Foreign Currency :                                                                 NIL                                     NIL
  6.   Earnings in Foreign Exchange :
       FOB value of exports                                                                              NIL                                     NIL
  7.   Payments to Auditors :
       – Audit Fee                                                                                      5,000                                 10,000
       – Tax Audit Fee                                                                                   NIL                                   2,500




                                                                      123
                                                                                     THE PAPERBASE COMPANY LIMITED

B. Additional Information pursuant to the provisions of Part IV of Schedule VI of Companies Act, 1956


BALANCE SHEET ABSTRACT AND COMPANY'S GENERAL BUSINESS PROFILE :



I.     REGISTRATION DETAILS :
       Registration No.                                                 66734
       State Code                                                           55
       Balance Sheet Date                                           31.03.2001

II.    CAPITAL RAISED DURING THE YEAR (Amount in Rs. thousand) :
       Public Issue                                                          NIL
       Rights Issue                                                          NIL
       Bonus Issue                                                           NIL
       Private Placement                                                     NIL

III.   POSITION OF MOBILISATION AND DEPLOYMENT OF FUNDS (Amount in Rs. thousand) :
       Total Liabilities                                  70,000
       Total Assets                                       70,000

       SOURCES OF FUNDS :
       Paid-Up Capital                                                    40,000
       Reserves & Surplus                                                 30,000
       Secured Loans                                                         NIL
       Unsecured Loans                                                       NIL

       APPLICATION OF FUNDS :
       Net Fixed Assets                                                      NIL
       Investments                                                           NIL
       Net Current Assets                                                (29,831)
       Misc. Expenditure                                                       87
       Accumulated Losses                                                 99,744

IV.    PERFORMANCE OF THE COMPANY (Amount in Rs. thousand) :
       Turnover
       (Incl. other Income)                                                  596
       Total Expenditure                                                  34,367
       Loss on transfer of understanding                                  12,799
       Profit/(Loss) before Tax                                           47,119
       Profit/(Loss) after tax                                            47,119
       Earning per Share in Rs.                                               -ve
       Dividend Rate (%)                                                     NIL

V.     GENERIC NAMES OF THREE PRINCIPAL PRODUCTS/SERVICES OF THE COMPANY
       Item Code No. (ITC Code)                              4820
       Product Description                                 Stationery Articles such
                                                           as exercise books, note
                                                           books, pads, etc., made of
                                                           paper and paper board




As per report of even date attached
                                                                                                   For and on behalf of the Board of Directors


                                                               VIJAY GUPTA (FCA - 81986)                                    R R VEDERAH
Place : New Delhi                                              VKGN & ASSOCIATES                                         NEERJA SHARMA
Dated : 21st June, 2001                                        Chartered Accountants                                              Directors




                                                                   124

				
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