Directors' Report: Financial Results
Directors' Report: Financial Results
Directors' Report: Financial Results
To the Members,
The Directors have pleasure in presenting the Seventy-sixth Annual Report of the Company along with the Audited
Accounts for the year ended 31st March, 2010.
FINANCIAL RESULTS
(Rupees in lacs)
Financial Years
2009-10 2008-09
DIVIDEND
Your Directors are pleased to recommend a dividend of Re.0.40 ps. (20%) per Equity Share of Rs.2/- each. The Dividend for
the year amounts to Rs.175.11 Lacs including the Dividend Distribution Tax.
BUSINESS OPERATIONS
The business segments of the Company consist of Real Estate, Business Centre and Trading.
Real Estate
Despite the global economic decline in fiscal 2008, India continues to be one of the fastest growing countries in the world and
is showing sign of recovery following the global financial downturn.
India’s ability to recover from the global slowdown and its own domestic liquidity crunch has been driven by the Country’s large
domestic savings and corporate retained earnings which have been used to finance the investments. Moreover, the fiscal
policy, primarily, in the form of reduced interest rates and Government intervention, has helped maintain private demand,
liquidity and short-term rates, thereby reducing the risk of loan losses.
The Real Estate Sector in India has exhibited a trend towards greater organization and transparency by various regulatory
reforms such as repeal of Urban Land (Ceiling and Regulation) Act in most of the States, modification in the Rent Control Act
to provide greater protection to homeowners wishing to rent out their properties, rationalization of property taxes in a numbers
of states and the computerization of land records.
With the spurt in the demand in real estate sector and especially in Mumbai, the Company has decided to embark on real
estate development activities on its South Mumbai situated land bank in priority over its other SEZ and FTWZ projects. In this
direction, consent of the Members of the Company has been sought by means of postal ballot. As a substantial step, an
understanding has been arrived at with K. Raheja Corp Pvt. Ltd. for redevelopment of some of the properties of the Company
situated in the South Mumbai.
- Initiatives taken to increase exports : Continuous efforts to identify new markets for existing and
new products are being made by the Company.
Sr. Name/Age(Years) Qualifications Experi Date of Designation/ Gross Last Employment held
No. -ence Employ Nature of remunera- (Previous Designation/
(years) -ment Duties tion Previous Company)
received
(Rs.)
Notes:
(a) Remuneration includes Salary, Commission on net profits, Leave Travel Assistance, Medical Expenses, Company's
Contribution to Provident Fund and other facilities/benefits the monetary value of which has been evaluated as per
the Income-tax Rules.
(b) The above employee is relative of Smt. Gauri Jatia, Directress of the Company.
For and on behalf of the
Board of Directors
iii Segment Capital Employed 239.99 340.22 566.66 114.41 3416.39 4677.67
Company’s policies on the Corporate Governance and due compliance report for the year ended 31st March, 2010 are as
under:
The Company’s philosophy on Corporate Governance is aimed at attainment of the highest level of transparency,
accountability and equity in all facets of its operations and in all interaction with its shareholders, employees, customers
and the Government. It includes not only application and adaptation of statutory rules/procedures and guidelines, but
also includes application and adoption of good corporate practices followed voluntarily, by the Company so as to keep
the Shareholders, Management, Investors and Authorities well informed about the Company. The Company believes
that all its operations and actions must serve the underlined goal of enhancing overall shareholder value over a sustained
period of time and at the same time protecting the interest of the stakeholders.
Composition of Board
The current strength of the Board of Directors of the Company is Eight. The Board has an optimum mix of executive and
non-executive directors. The Chairman and Managing Director is executive director while other directors are non-
executive directors. Except two non-executive directors rest are independent. This combination helps the Company take
benefit of the experience and expertise of the directors, in their core area of competence. The Managing Director is
receiving remuneration as per sanction accorded by the members of the Company. The other directors do not receive any
remuneration except sitting fees. There are no nominee directors on the Board of the Company. The Board has an
Executive Chairman and the number of independent Directors is more than half of the total strength of the Board.
The Company has complied with the requirements of Clause 49 of the Listing Agreement with regards to the composition
of the Board.
Six Board Meetings on 13th May, 2009, 10th June, 2009, 24th July, 2009, 7th September, 2009, 9th October, 2009 and 13th
January, 2010 were held during the financial year 2009-2010 and the gap between two Board meetings did not exceed
4 months.
The information pertaining to attendance of each director at the Board Meetings and at the last Annual General Meeting
(AGM) and the number of companies and committees where he/she is a director/committee member are as under:
# Excluding private companies, foreign companies and companies registered under Section 25 of the Companies Act,
1956.
Committee includes Audit Committee and Shareholders/Investors Grievance Committee. Directors who could not attend
the meeting have obtained leave of absence from the Board/Committee.
Directors with materially significant related party transaction, pecuniary or business relationship with the company
There have been no materially significant transactions, pecuniary transactions or relationship between the Company and
its directors that may have a potential conflict with the interest of the Company at large. However related party transactions
are disclosed in Note No 23 to Schedule 18, attached to the Accounts and form part of this Annual Report.
Board Procedure
The Board meets at least once a quarter to review the quarterly performance and the financial results. The Board
Meetings are generally scheduled well in advance and the notice of each Board Meeting is given in writing to each
Director. All the items in the agenda are accompanied by notes giving comprehensive information on the related subject
and in certain matters such as financial/business plans, financial results, detailed presentations are made. The agenda
and the relevant notes are sent in advance separately to each Director and only in exceptional cases; the same is tabled
at the meeting. The Board is also free to recommend the inclusion of any matter for discussion in consultation with the
Chairman.
The information as specified in Annexure I to Clause 49 of the Listing Agreement is regularly made available to the
Board.
To enable the Board to discharge its responsibilities effectively, the members of the Board are briefed at every Board
Meeting, on the overall performance of the Company, with presentations by functional heads. Senior management is
invited to attend the Board Meetings so as to provide additional inputs to the items being discussed by the Board.
The Board’s role, functions, responsibility and accountability are clearly defined. In addition to matters statutorily
requiring Board’s approval, all major decisions involving policy formulation, strategy and business plans, annual operating
and capital expenditure budgets, new investments, compliance with statutory/ regulatory requirements, major accounting
provisions and write-offs are considered by the Board.
The minutes of the Board Meetings are circulated in advance to all Directors and confirmed at subsequent Meeting.
Terms of reference
The terms of reference of the Audit Committee are wide enough to cover the matters specified for it in Clause 49 of the
Listing Agreement as well as in Section 292A of the Companies Act, 1956. In brief, the Audit Committee of the Company,
inter-alia, provides assurance to the Board on the adequacy of the internal control systems, financial disclosures and
ensures that generally accepted accounting principles are observed by the Company. The Committee also provides
guidance and liaises with the Internal Auditors as well as the Statutory Auditors of the Company.
The First Audit Committee had been constituted by the Board at its meeting held on 31 st January, 2001. The same was
reconstituted from time to time. The current strength of the Audit Committee of the Board is four members. All the
members of the Audit Committee are Non-executive directors. Two-third of the members of the Committee are independent
directors. The Committee has elected Shri Anand Didwania, an independent director as its Chairman. Shri R.N. Sethna
resigned as an Audit Committee member w.e.f. 13th January, 2010. In his place, Smt. Vasanti Patel was appointed on the
same date. All the members of Audit Committee are financially literate and possess accounting and related financial
management expertise. The Managing Director of the Company is a permanent Invitee of the Audit Committee. At the
invitation of the Company, representatives from various divisions of the Company, internal auditors, statutory auditors and
Financial Controller also attend the Audit Committee meetings to respond to queries raised at the Committee meetings.
The Company Secretary acts as the Secretary of the Audit Committee.
Five meetings on 13th May, 2009, 10th June, 2009, 24th July, 2009, 9th October, 2009 and 13th January, 2010 were held
during the financial year 2009-2010 and the gap between two meetings did not exceed 4 months.
The information pertaining to attendance of each member at the meetings of the Audit Committee is as under:
Internal Auditors
The Company has appointed M/s. M. L. Sharma & Co., a firm of Chartered Accountants as Internal Auditors to review the
internal control systems of the Company and to report thereon. The report of the Internal Auditors is reviewed by the Audit
Committee.
The Remuneration Committee had been constituted by the Board at its meeting held on 29th April, 2002. It comprised
of three member directors all of whom were independent and Non-executive directors. The Remuneration Committee
was consisting of Shri Rajas. R Doshi (Chairman), Shri Anand Didwania and Smt Vasanti Patel. The terms of reference to
Remuneration Committee include reviewing and recommending the terms of remuneration payable to Executive
Director. The Company Secretary acts as the Secretary of the Remuneration Committee.
The Committee met only once during the financial year 2009-2010 on 10th June, 2009. All the members were present at
the Meeting.
The Managing Director has been receiving the remuneration as per the recommendation of the Remuneration Committee,
the details of which are given in Note No. 13 of Schedule 18 to the Accounts. The non-executive directors do not receive
any remuneration except the sitting fees.
The Shareholders/Investors’ Grievance Committee was constituted by the Board at its meeting held on 31 st January,
2002. The Committee comprises of three directors; majority of them being independent and Non-executive. Shri Rajas
R. Doshi has been elected as the Chairman of the Shareholders/Investors’ Grievances Committee. The Company
Secretary acts as Secretary of the Committee.
During the year, the Committee met once, on 9 th October, 2009. The information pertaining to attendance of each
member at the meeting of the Committee is as under:
During the year, the Company received total 6 complaints and all of them were satisfactorily resolved. The details of the
complaints received and solved are given under:
Shri Ajit P. Walwaikar, G.M. (Legal) & Company Secretary is the Compliance Officer of the Company.
2008-2009 24.07.2009 4.30 p.m. Modern centre, Sane Guruji Marg, Mahalaxmi, Mumbai – 400011
2007-2008 16.07.2008 11.00 a.m. Modern centre, Sane Guruji Marg, Mahalaxmi, Mumbai – 400011
2006-2007 16.07.2007 3.00 p.m. Modern centre, Sane Guruji Marg, Mahalaxmi, Mumbai – 400011
Details of Special Resolutions passed in the last three Annual General Meetings and Extra Ordinary General Meetings:
No Resolutions were passed through Postal Ballot during the year under review.
The Company has three Subsidiary Companies. The Company has a material non-listed Indian subsidiary whose net
worth (i.e. paid-up capital and free reserves) exceed 20% of the consolidated net worth of the listed holding Company
and its subsidiaries in the immediately preceding accounting year. As such, an independent director of the Company is
being appointed on the Board of Directors of its wholly owned subsidiary – Modern India Property Developers Limited.
Brief of the Company’s Wholly Owned Subsidiary Companies (WOS)/ Subsidiary as on March 31, 2010 are as under:
Modern India Realty & Infrastructures Ltd ceased to be the wholly owned subsidiary w.e.f. 8th June, 2009.
There was a Scheme of amalgamation of Indian Institute of Jewellery Limited with Modern India Limited. The same has
been sanctioned by the Hon’ble Bombay High Court on 7th May, 2010. The Appointed date is 1st July, 2009 and the
Effective date is 3rd June, 2010.
Subsidiary Monitoring Framework
All the Subsidiary Companies are Board managed with their Boards having the rights and obligations to manage such
companies in the best interest of their stakeholders. As a majority Shareholder, the Company monitors the performance
of such Companies, inter alia, by the following means:
a) All minutes of the meetings of subsidiary companies are placed before the Company’s Board regularly;
b) A statement containing all significant transactions and arrangements entered into by the unlisted subsidiary companies
has been placed before the Company’s Board.
VIII DISCLOSURES
a) All related party transactions have been entered into in the ordinary course of business and were placed periodically
before the Audit Committee in summary form. There were no material individual transactions with related parties which
were not in the normal course of business required to be placed before the Audit Committee and that may have potential
conflict with the interest of the Company at large. All individual transactions with related parties of others were on an arm’s
length basis.
b) All Accounting Standards mandatorily required have been followed in preparation of financial statements and no
deviation has been made in following the same.
c) Risk assessment and its minimization procedures have been laid down by the Company and the same have been
informed to the Directors on the Board. These procedures are periodically reviewed to ensure that executive
management controls risks through means of a properly defined framework.
d) No money was raised by the Company through public issue, rights issue, preferential issues, etc. in the previous financial
year and hence provisions contained in this behalf in Clause 49 of the Listing Agreement are not applicable for
Compliance by the Company
e) i) All pecuniary relationship or transactions of the non-executive Directors vis-à-vis the Company have been disclosed
in item IV of this report;
ii) The Company has only one Managing Director on the Board whose appointment and remuneration has been fixed
by the Board on the recommendation of the Remuneration Committee duly approved by the members. The
remuneration paid was as follows:
Managing Director’s Remuneration (in Rs.)
i) Salary 21,00,000
ii) Contribution to Provident Fund 2,52,000
iii) Perquisites 10,61,656
iv) Commission 68,03,622
(iii) The service of the Managing Director is on contractual basis for a period of three (3) years upto 31.07.2012. The
service contract provides for notice period for six months from either side . He is relative of Smt. Gauri Jatia, Directress
of the Company.
f) Management Discussion and Analysis forms part of the Annual Report to the shareholders and it includes discussion on
matters as required under the provisions of clause 49 of the Listing Agreement with the Stock Exchange.
List of Other Directorships held excluding · Shree Rani Sati Investment · The Indian Hume Pipe Co Ltd.
foreign companies, Companies under & Finance Limited · IHP Finvest Ltd
sec 25 of the Companies Act, 1956 & · Modern India Realty & · Hindustan Construction Co Ltd.
Private Companies Infrastructures Limited
X MEANS OF COMMUNICATION
a) Quarterly and Half Yearly Results: Quarterly and Half Yearly results were published in ‘Economic Times’ and/or
‘Maharashtra Times’ and/or ‘Free Press Journal’ and/or ‘Navshakti’.
b) News Release, Presentation, etc: Official news releases, detailed presentations made to media, analysts, institutional
investors, if any, are displayed on the Company’s website www.modernindia.co.in.
c) Web-site: The Company’s website www.modernindia.co.in contains a separate section on “Investor Relations’ where
shareholders information is available. Full Annual Report is also available on the website in a user friendly and
downloadable form.
d) Annual Report: Annual Report containing, inter alia, Audited Annual Accounts, Consolidated Financial Statements,
Directors’ Report, Auditors’ Report and other important information is circulated to the members and others entitled
thereto.
e) SEBI EDIFAR: Annual Report, Quarterly Results, Shareholding Pattern, etc. of the Company were also posted on the
SEBI EDIFAR website www.sebiedifar.nic.in. However, the same has been discontinued, now, by the concerned authority
from 2010-11.
15000
10000
5000
0
Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar
09 09 09 09 09 09 09 09 09 10 10 10
16 ANNUAL REPORT 2009-10
Shareholding Pattern by size
Sr. Shareholding of Number of Face Value Amount in
No. Nominal Value Shareholders Percentage Amount in Percentage
Rs. Rs.
A Promoters’ holding
a Indian Promoters 2348443 6.26
b Foreign Promoters 0 0
c Persons acting in concert 29994732 79.89
Sub-Total 32343175 86.15
B Non-Promoters’ Holding
Institutional Investors
a Mutual Funds and UTI 0 0
b Banks, Financial Institutions, Insurance Companies 1979216 5.27
c FIIs 20003 0.05
Sub-Total 1999219 5.32
C Others
a Private Corporate Bodies 914282 2.44
b Indian Public 1997477 5.32
c NRIs/OCBs 288597 0.77
D Any other (Foreign nationals) - -
Sub-Total 3200356 8.53
Grand Total 37542750 100.00
To the Shareholders,
Modern India Limited,
Mumbai.
We have examined the compliance of conditions of Corporate Governance by Modern India Limited for the year ended 31st
March 2010, as stipulated in Clause 49 of the Listing Agreement of the said Company with Stock Exchange.
The compliance of conditions of Corporate Governance is the responsibility of the management. Our examination was limited
to procedures and implementation thereof, adopted by the Company for ensuring the compliance of the conditions of
Corporate Governance. It is neither an audit nor an expression of opinion in the financial statements of the Company.
In our opinion and to the best of our information and according to the explanations given to us, we certify that the Company
has complied with the conditions of Corporate Governance as stipulated in the above mentioned Listing Agreement except
as stated in Clause 49 (III) (i), wherein the company has not appointed one of its independent Directors on the board of Modern
India Property Developers Limited, its wholly owned material non-listed Indian subsidiary of the company.
We state that as per the records maintained by the company, there are no investor grievances remaining unattended/pending
for more than 30 days.
We further state that such compliance is neither an assurance as to the future viability of the Company nor the efficiency or
effectiveness with which management has conducted the affairs of the Company.
SATISH KELKAR
Mumbai, dated: 18th June, 2010 Partner
(M. NO. 38934)
SATISH KELKAR
Mumbai, dated: 18th June, 2010 Partner
(M. NO. 38934)
(b) According to the information and explanation given to us, we are of the opinion that the rate of interest and other
terms and conditions of unsecured loans given by the company are not prima facie prejudicial to the interest of
the company.
(c) According to the information and explanation given to us, parties are repaying the principal amounts as
stipulated and have also been regular in the payment of interest where applicable.
(d) According to the information and explanation given to us, we are of the opinion that there are no overdue
amounts more than one lakh rupees in case of principal and interest.
(e) The Company has not taken unsecured loans / inter corporate deposits from parties covered in the Register
maintained under Section 301 of the Companies Act, 1956.
(f) As the Company has not taken any loans taken from the parties covered in the Register maintained under Section
301 of the Companies Act, 1956, Clauses III (f) and III (g) are not applicable.
(iv) In our opinion and according to the information and explanations given to us, there are adequate internal control
systems commensurate with the size of the Company and the nature of its business, with regard to purchases of
inventory, fixed assets and with regard to the sale of goods and services. During the course of our audit, no major
weaknesses have been noticed in the internal controls.
(v) (a) According to the information and explanations given to us, we are of the opinion that all the transactions that
need to be entered in the register maintained in pursuance of section 301 of the Companies Act, 1956 have been
so entered.
(b) According to the information and explanations given to us, we are of the opinion that these transactions have
been made at prices which are reasonable having regard to the prevailing market prices at the relevant time.
(vi) In our opinion and according to the information and explanations given to us, the company has not accepted any
deposits from the public to which the provisions of Sections 58A and 58AA of the Companies Act, 1956 and the
Companies (Acceptance of Deposits) Rules, 1975 apply. No order has been passed by the Company Law Board,
National Law Tribunal or Reserve Bank of India or any other court or any other tribunal.
(vii) In our opinion, the company has an internal audit system commensurate with the size and nature of its business.
(viii) Rules made by the Central Government under Section 209 (1) (d) of the Companies Act, 1956 are not applicable to
the activities of the company.
(x) The Company does not have any accumulated losses at the end of the financial year. The company has not incurred
any cash losses during the financial year covered by our audit and in the immediately preceding financial year.
(xi) In our opinion and according to the information and explanations given to us, we are of the opinion that the Company
has not defaulted in repayment of dues to any financial institution and banks. The company does not have any
outstanding debentures.
(xii) Based on our examination of documents and records, we are of the opinion that the company has not granted any
loans and advances on the basis of security by way of pledge of shares and other securities.
(xiii) In our opinion, the Company is not a chit fund or a nidhi / mutual benefit fund / society. Therefore, the provisions of
clause 4 (xiii) of the Order are not applicable to the company.
(xiv) In our opinion the Company is not dealing in or trading in shares, securities, debentures and other investments.
Accordingly, the provisions of clause 4 (xiv) are not applicable to the Company.
(xv) The company has given a corporate guarantee for loans taken by foreign subsidiary from the bank. However, the terms
and conditions thereof are not prejudicial to the interest of the company.
(xvi) The term loans have been applied for the purpose for which they were raised.
(xvii) According to the information and explanations given to us and on an overall examination of the balance sheet of the
Company, we report that the no funds raised on short-term basis have been used for long-term investment.
(xviii) The Company has not made any preferential allotment of shares during the year to the parties and companies
covered in the Register maintained under section 301 of the Companies Act, 1956.
(xix) The Company has not issued any debentures during the financial year.
(xx) The Company has not raised money by public issue during the year.
(xxi) Based on the audit procedures performed and according to the information and explanations given to us, we report
that no fraud on or by the Company has been noticed or reported during the course of our audit.
SATISH KELKAR
Mumbai, dated: 18th June, 2010 Partner
(M. NO. 38934)
SOURCES OF FUNDS :
Shareholders’ Funds
Share Capital 1 75,085,930 75,085,930
Reserves & Surplus 2 374,698,282 323,951,036
449,784,212 399,036,966
Loan Funds
Secured Loans 3 511,086,406 740,373,604
Unsecured Loans 4 145,988,644 181,521,944
Deferred Tax Liability (Net)-Note No. 12 11,235,061 11,304,837
APPLICATION OF FUNDS :
Fixed Assets 5
Gross Block 330,917,107 279,424,180
Less: Depreciation 122,050,675 101,658,436
Net Block 208,866,432 177,765,744
Capital work-in-progress(Including Advances for 2,769,510 2,985,650
Capital Expenditure Rs. Nil) 211,635,942 180,751,394
As per our report attached For and on behalf of the Board of Directors
For K. S. Aiyar & Company V. K. Jatia
Chartered Accountants Chairman & Managing Director
Firm Reg. No. 100186W
Ajit P. Walwaikar Directors
G.M. (Legal) & Company Secretary R. Sethna A. Didwania
Satish Kelkar R. R. Doshi P. K. Bubna
Partner N. K. Deora Gauri Jatia Vasanti Patel
Financial Controller
Mumbai : 18th June, 2010 Mumbai : 18th June, 2010
INCOME :
Income from Operations 13 2,376,704,531 2,069,607,397
Other Income 14 46,712,052 43,211,738
TOTAL 2,423,416,583 2,112,819,135
EXPENDITURE :
Purchase of Goods for Resale 1,728,184,194 2,216,315,436
Real Estate Business - Purchases 0 6,787,800
Administrative & Other Expenses 15 96,215,799 80,756,155
Finance Charges 16 2,795,402 41,176,913
Decrease / (Increase) in Stock 17 386,965,221 (330,950,619)
Depreciation 15,422,680 10,126,809
2,229,583,296 2,024,212,494
Profit for the year before Taxation 193,833,287 88,606,641
Less: Goodwill of IIJL on amalgamation (Note No. 8 - d) 14,265,834 -
179,567,453 88,606,641
Provision for Taxation
Current Income Tax 58,000,000 21,100,000
Wealth Tax 580,000 739,000
Fringe Benefit Tax 58,580,000 325,000
Deferred Tax - Note No. 12 (69,776) 1,402,974
121,057,229 65,039,667
Tax Provision in respect of earlier years written back 251,256 (1,605,040)
Profit for the Year after Tax 121,308,485 63,434,627
Balance Brought Forward 288,749,420 252,034,363
Less: Debit Balance in Profit & Loss Account of IIJL
on Amalgamation (Note No. 8 - b) (53,049,987) 235,699,433 -
Amount Available for Appropriations 357,007,918 315,468,990
Appropriations:
(1) Proposed Dividend 15,017,100 18,771,375
(2) Tax on Distributed Profits 2,494,152 3,190,195
(3) General Reserve 9,098,000 4,758,000
Balance carried to Balance Sheet 330,398,666 288,749,420
EARNINGS PER SHARE - Before Exceptional Items (Face Value Rs.2) 3.23 1.69
EARNINGS PER SHARE - BASIC & DILUTED (Face Value Rs.2) 3.23 1.69
Significant Accounting Policies and
Notes to the Accounts 18
As per our report attached For and on behalf of the Board of Directors
For K. S. Aiyar & Company V. K. Jatia
Chartered Accountants Chairman & Managing Director
Firm Reg. No. 100186W
Ajit P. Walwaikar Directors
G.M. (Legal) & Company Secretary R. Sethna A. Didwania
Satish Kelkar R. R. Doshi P. K. Bubna
Partner N. K. Deora Gauri Jatia Vasanti Patel
Financial Controller
Mumbai : 18th June, 2010 Mumbai : 18th June, 2010
SCHEDULE - 4
UNSECURED LOANS :
(1) Deposits 103,488,644 171,521,944
(2) Short Term Loans from Limited Companies 42,500,000 10,000,000
TOTAL 145,988,644 181,521,944
SCHEDULE - 5
FIXED ASSETS
PLANT & MACHINERY 45,511,205 37,240,428 2,782,659 - 85,534,292 30,368,982 3,641,671 6,278,024 - 40,288,677 45,245,615 15,142,223
FURNITURE & FITTINGS 23,160,975 2,989,550 15,659 - 26,166,184 14,582,599 1,667,279 1,810,760 - 18,060,638 8,105,546 8,578,376
VEHICLES 5,930,867 - 6,382,190 1,883,530 10,429,527 2,750,623 - 1,979,465 827,647 3,902,441 6,527,086 3,180,244
TOTAL 279,424,180 44,195,949 9,180,508 1,883,530 330,917,107 101,658,436 5,797,206 15,422,680 827,647 122,050,675 208,866,432 177,765,744
PREVIOUS YEAR 259,948,197 - 20,218,858 742,875 279,424,180 92,219,251 0 10,126,809 687,624 101,658,436 177,765,744
Note:
(*) Additions on Amalgamation represent the Cost and Accumulated Depreciation of Fixed Assets of erstwhile 'Indian Institute of
Jewellery Ltd' which has been amalgamated with the Company vide Hon'ble Bombay High Court's Order Dated 07.05.2010
As at As at
31st March, 2010 31st March, 2009
(Rs.) (Rs.) (Rs.)
SCHEDULE - 6
INVESTMENTS : Other Investments
A. LONG TERM : At Cost (Unquoted)
a. In Subsidiary Companies - Fully Paid Up
(i) 1,50,00,000 Equity Shares of Rs. 10/- each in
Modern India Property Developers Ltd.
(Previous Year 1,50,00,000 Equity Shares of
Rs. 10/- each)- Note No.9 150,000,000 150,000,000
(ii) 99,94,000 Equity Shares of Modern
International (Asia) Ltd. of HKD 1 each.
(Previous Year 99,94,000 Equity Shares of HKD 1 each.) 55,389,100 55,389,100
(iii) Nil Equity Shares of Indian Institute of Jewellery Ltd.
of Rs. 10/- each. - 30,000,000
(Previous Year 30,00,000 Equity Shares of Rs. 10/- each)
Note No. 8
Infrastructure Ltd. of
(Previous Year 2,50,000 Equity Shares of Rs. 10/- each) 2,500,000 2,500,000
(ii) 20,000 Equity Shares of The Shamrao Vithal Co-op Bank Ltd 500,000 500,000
As at As at
31.03.2010 31.03.2009
4,155,018 4,155,018
212,799,118 243,299,118
ISCHEDULE - 7
INVENTORIES :
(As Technically Certified by the management)
Stores - At the lower of Cost & Net Realizable Value 1,135,365 -
Trading Goods - At the lower of Cost and Net Realisable Value 8,022,550 334,782,932
Real Estate Business:
(a) Land and Structures - At Book Value 42,487,350 41,522,447
(b) Unsold Flats - At the lower of Cost and 25,158,000 76,633,610
Net Realisable Value
67,645,350 118,156,057
TOTAL 76,803,265 452,938,989
SCHEDULE - 8
SUNDRY DEBTORS (Unsecured) :
Debts Outstanding for a period exceeding Six months
Considered Good 1,054,257 -
Considered Doubtful - -
1,054,257
Other Debts
Considered Good 315,653,395 447,084,541
TOTAL 316,707,652 447,084,541
SCHEDULE - 9
CASH AND BANK BALANCES :
Cash on hand 470,753 781,301
Balances with Scheduled Banks
In Current Accounts 5,303,844 2,371,624
In Deposit Accounts 19,190,000 19,140,000
24,493,844 21,511,624
TOTAL 24,964,597 22,292,925
SCHEDULE - 10
LOANS AND ADVANCES :
(Unsecured Considered Good)
Advances Recoverable in Cash or
in kind or for value to be received 59,277,057 62,933,115
Loans to Limited Companies 31,400,000 168,000,000
Loans to Subsidiary Companies - Note No. 9 & 10 499,875,000 437,430,685
Minimum Alternate Tax Credit Entitlement - Note No. 1 (J) - d - 8,435,000
Income Tax payments including Tax Deducted at Source 86,440,292 104,851,182
Sundry Deposits 5,804,289 6,067,310
TOTAL 682,796,638 787,717,292
SCHEDULE - 11
CURRENT LIABILITIES
Acceptances (Note No. 3) 248,491,579 248,546,205
Sundry Creditors 24,615,570 475,891,876
Advances Received 15,599,223 4,629,011
Interest Accrued but not due on Loan 44,121 750,822
Investors Education and Protection Fund (Refer Note Below)
- Unclaimed Dividend 1,259,032 1,373,245
Other Liabilities 20,909,082 5,107,044
TOTAL 310,918,607 736,298,203
SCHEDULE - 12
PROVISIONS
Proposed Dividend 15,017,100 18,771,375
Tax on Distributed Profits 2,494,152 3,190,195
For Taxation Note No. 1 (J) (d) 75,986,030 41,466,135
For Retirement Benefits 3,197,000 2,121,000
TOTAL 96,694,282 65,548,705
Note: There is no amount due and outstanding as at Balance Sheet date to be credited to Investors Education and Protection
Fund.
SCHEDULE - 13
INCOME FROM OPERATIONS
SALES:
(i) Traded Goods
- Export Sales - 76,530,908
- Local Sales 2,073,705,898 2,073,705,898 1,857,715,979
(ii) Real Estate Business 203,200,000 7,290,000
2,276,905,898 1,941,536,887
Income from Business Centre 72,729,241 93,678,206
[Tax Deducted at source Rs. 1,21,44,166/-, (Previous Year Rs. 2,09,34,697/-)].
Vocational Trainning Fees 4,629,443 -
[Tax Deducted at source Rs. 26,751/-].
Share of Profit from Joint Venture 17,463,060 30,312,304
Income from Real Estate Business [Tax Deducted at Source 4,976,889 4,080,000
Rs. 3,71,036/- (Previous Year Rs. 5,39,564/-)]
TOTAL 2,376,704,531 2,069,607,397
SCHEDULE - 14
OTHER INCOME
Rent [Tax Deducted at source Rs. 60,03,449/- 39,785,013 32,797,629
(Previous Year Rs. 81,92,691/-)]
Miscellaneous Income 6,644,129 6,463,558
[Tax Deducted at source Rs. 15,32,753/-
(Previous Year Rs. 7,65,311/-)]
Dividend on Long Term Investments 72,910 72,910
Provision no longer required Written Back 210,000 3,877,641
TOTAL 46,712,052 43,211,738
SCHEDULE - 15
ADMINISTRATIVE AND OTHER EXPENSES :
Stores Consumed 258,363 -
Power & Fuel 1,863,509 988,848
Water Charges 503,267 190,975
Repairs to:
Machinery 846,661 412,206
Buildings 2,216,464 16,889
Others 2,725,123 287,286
5,788,248 716,381
Payment to and Provision for Employees
Salaries and Wages 26,678,316 15,561,987
Contribution to Provident and Other Funds 1,279,147 1,212,113
Gratuities 909,794 436,919
Welfare Expenses 1,088,821 727,464
29,956,078 17,938,483
Travelling & Conveyance 3,773,643 2,542,742
Legal and Professional Charges 11,896,537 8,452,682
Donation 51,000 11,000
SCHEDULE - 16
FINANCE CHARGES:
(i) Interest on Fixed Loans 71,903,726 61,744,628
(ii) Other Interest 12,402,510 43,772,382
84,306,236 105,517,010
Less: Interest - Gross (Note No. 5)
[Tax Deducted at source Rs. 1,65.56,988/-
(Previous Year Rs. 1,43,41,189/-)] 81,510,834 64,340,097
TOTAL 2,795,402 41,176,913
SCHEDULE - 17
INCREASE / (DECREASE) IN STOCK :
Opening Stock
Trading Goods 334,782,932 3,832,313
Add: Stock of IIJL on Amalgalgamation 1,621,785 336,404,717
Real Estate Business:
(a) Land and Structures 41,522,447 41,522,447
(b) Unsold Flats 76,633,610 91,484,376
Add: Renovation Expenses 8,072,347 -
Less: Transferred during the year to Fixed Assets-Buildings - 84,705,957 14,850,766
76,633,610
126,228,404 118,156,057
462,633,121 121,988,370
Closing Stock
Trading Goods 8,022,550 334,782,932
Real Estate Business:
(a) Land and Structures 42,487,350 41,522,447
(b) Unsold Flats 25,158,000 76,633,610
67,645,350 118,156,057
75,667,900 452,938,989
Increase / (Decrease) in Stock TOTAL (386,965,221) 330,950,619
Computation of Net Profits in accordance with Section 349 read with Section 198 of the Companies Act, 1956 and
Commission Payable to the Managing Director.
Net Profit for the Year before Taxation 193,833,287 88,606,641
Add:
(i) Managing Directors Remuneration
(Excluding Commission) 3,413,656 3,690,726
(ii) Commission to Managing Director 6,803,622 1,014,594
(iii) Directors Sitting Fees 295,000 235,000
(iv) Depreciation Provided in the Books of Account 15,422,680 10,126,809
(v) Loss on Sale of Long Term Investments - 14,285,750
25,934,958 29,352,879
219,768,245 117,959,520
Sources of Funds:
Application of Funds:
Profit / (Loss) Before Tax 193833 Profit / (Loss) After Tax 121308
Signatures to Schedule 1 to 18
As per our report attached For and on behalf of the Board of Directors
For K. S. Aiyar & Company V. K. Jatia
Chartered Accountants Chairman & Managing Director
Firm Reg. No. 100186W
Ajit P. Walwaikar Directors
G.M. (Legal) & Company Secretary R. Sethna A. Didwania
Satish Kelkar R. R. Doshi P. K. Bubna
Partner N. K. Deora Gauri Jatia Vasanti Patel
Financial Controller
Mumbai : 18th June, 2010 Mumbai : 18th June, 2010
As per our report attached For and on behalf of the Board of Directors
For K. S. Aiyar & Company V. K. Jatia
Chartered Accountants Chairman & Managing Director
Firm Reg. No. 100186W
Ajit P. Walwaikar Directors
G.M. (Legal) & Company Secretary R. Sethna A. Didwania
Satish Kelkar R. R. Doshi P. K. Bubna
Partner N. K. Deora Gauri Jatia Vasanti Patel
Financial Controller
Mumbai : 18th June, 2010 Mumbai : 18th June, 2010
Name of the Subsidiary Company Financial Year of the Extent of The Net aggregate amount of the Subsidiary Companies Material changes, if any,
Subsidiary Company Holding Profit/(Loss) so far as it concerns the members of between the end of the
Ended On Company’s Modern India Limited. (Amount in Rupees) financial year of the
Interest Subsidiary Company and
Not dealt with in the Dealt with in the Holding the Holding Company.
Holding Company’s Accounts Company’s Accounts
For the For the previous For the For the previous
Financial Financial year Financial year Financial year
year of the since they of the since they
Subsidiary became Subsidiary became
Subsidiary Subsidiary
Modern India Property Developers Limited 31st March, 2010 100% (307650) (18572) Nil Nil N.A.
Modern International (Asia) Limited.# 31st March, 2010 100% 4366433 870282 Nil Nil N.A.
Modern India Free Trade Warehousing
Pvt Limited 31st March, 2010 51% (6500) N.A. Nil Nil N.A.
Particulars required under Section 212 of the Companies Act, 1956 in respect of Subsidiaries
Modern India Property Modern International Modern India Free Trade
44
Developers Limited (Asia) Limited.# Warehousing Pvt. Limited
a) Capital 150000000 55389100 500000
b) Reserves (213511) 11213581 (13030)
c) Total Assets 646497101 106572655 68016861
d) Total Liabilities 646497101 106572655 68016861
e) Details of Investments 0 2318905 0
f) Turnover 108092 303052068 0
g) Profit before Taxation 88027 4366433 (6530)
h) Provision for Taxation 0 0 0
i) Profit after Taxation 88027 4366433 (6530)
j) Proposed Dividend 0 0 0
# Figures in US Dollars are converted for Assets & Liabilities @ 44.92 & 45.41 respectively and at average rate (Rs.47.42) for income & expenses.
To,
The Board of Directors,
Modern India Limited
1. We have examined the attached Consolidated Balance Sheet of Modern India Limited (“the Company”), its Subsidiaries
and Joint Venture (“The Modern Group”) as at March 31, 2010, the Consolidated Profit and Loss Account and the
Consolidated Cash flow Statement for the year then ended. These financial statements are the responsibility of the
Company’s Management and have been prepared by the management on the basis of separate financial statements and
other financial information regarding components. Our responsibility is to express an opinion on these financial state-
ments based on our audit.
2. We conducted our audit in accordance with generally accepted auditing standards in India. These standards require that
we plan and perform the audit to obtain reasonable assurance about whether the financial statements are prepared, in
all material respects, in accordance with an identified financial reporting framework and are free of material misstate-
ments. An audit includes, examining on a test basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used and significant estimates made by manage-
ment, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable
basis for our opinion.
3. We did not audit the financial statements of certain Subsidiaries whose financial statements reflect total assets of Rs.
8210.82 lacs, Company’s share in Revenue of Rs. 3031.60 lacs, share in Profit of Rs 44.48 lacs and cash inflow of Rs.
1229.18 lacs. These financial statements have been audited by other auditors whose reports(s) have been furnished to
us and our opinion, in so far as it relates to the amounts included in respect of the said audited Subsidiaries, is based
solely on the Reports of the other auditors.
4. We report that the consolidated financial statements have been prepared by the Company’s Management in accordance
with the requirements of Accounting Standard (AS) 21, Consolidated Financial Statements and AS 27 Financial Report-
ing of Interest in Joint Ventures as notified under the Companies (Accounting Standard) Rules, 2006.
5. As mentioned in Note No. 2 – (v) & (vi) of Schedule 18 , Notes to Accounts, the company has received during the year
two demands raised by the Municipal Corporation of Greater Mumbai (MCGM) for property taxes & Penalty for regulariza-
tion of change of user in its existing premises amounting to Rs. 550.42 lacs and Rs. 598.88 lacs respectively. The
company has not accepted these demands and has filed a complaint with the appropriate authority in the first case and
is awaiting the details of computation in other case .In the meanwhile, no provision has been made against these
demands in the view of the uncertainty involved in terms of final settlement, the ultimate impact of which on the financial
statements is presently unascertained.
6. Subject to matters referred to in paragraph 5 above, based on our audit and on consideration of the reports of other
auditors on separate financial statements and on the other financial information of the components, and to the best of
our information and according to the explanations given to us, we are of the opinion that the attached Consolidated
Financial Statements give a true and fair view in conformity with the accounting principles generally accepted in India:
(i) the Consolidated Balance Sheet gives a true and fair view of the consolidated state of affairs of the Modern Group
as at 31st March, 2010;
(ii) the Consolidated Profit and Loss Account, of the profit of the Modern Group for the year ended on that date; and
(iii) in the case of the Consolidated Cash Flow Statement, of the cash flows of the Modern Group for the year ended on
that date.
For K.S. Aiyar & Co.
Chartered Accountants
Firm Registration No. 100186W
SATISH KELKAR
Mumbai, dated: 18th June, 2010 Partner
(M. NO. 38934)
SOURCES OF FUNDS :
Shareholders’ Funds
Share Capital 1 75,085,930 75,085,930
Reserves & Surplus 2 303,597,622 201,061,125
378,683,552 276,147,055
Minority Interest 211,749 211,591
Loan Funds
Secured Loans 3 511,631,239 742,525,338
Unsecured Loans 4 143,693,892 262,774,942
Deferred Tax Liability (Net) 11,235,061 11,304,837
TOTAL 1,045,455,493 1,292,963,763
APPLICATION OF FUNDS :
Fixed Assets 5
Gross Block 345,237,142 308,358,723
Less: Depreciation 129,051,247 112,865,662
Net Block 216,185,895 195,493,061
Capital work-in-progress(Including Advances for 2,769,510 34,665,664
Capital Expenditure Rs. Nil) 218,955,405 230,158,725
Pre - Operative Expenses - Pending Allocation 557,348,758 484,667,672
Investments 6 9,473,923 15,812,901
Current Assets, Loans & Advances
Inventories 7 76,803,265 454,225,840
Sundry Debtors 8 314,894,123 509,565,153
Cash & Bank Balances 9 73,289,420 75,187,012
Loans and Advances 10 301,585,833 450,439,043
766,572,641 1,489,417,048
Less: Current Liabilities & Provisions
Current Liabilities 11 379,640,090 836,363,213
Provisions 12 127,258,707 90,763,704
506,898,797 927,126,917
Net Current Assets 259,673,844 562,290,131
Miscellaneous Expenditure 3,563 34,334
(To the extent not written off or adjusted)
Significant Accounting Policies and TOTAL 1,045,455,493 1,292,963,763
Notes to the Accounts 18
As per our report attached For and on behalf of the Board of Directors
For K. S. Aiyar & Company V. K. Jatia
Chartered Accountants Chairman & Managing Director
Firm Reg. No. 100186W
Ajit P. Walwaikar Directors
G.M. (Legal) & Company Secretary R. Sethna A. Didwania
Satish Kelkar R. R. Doshi P. K. Bubna
Partner N. K. Deora Gauri Jatia Vasanti Patel
Financial Controller
Mumbai : 18th June, 2010 Mumbai : 18th June, 2010
PROFIT & LOSS ACCOUNT FOR THE YEAR ENDED 31ST MARCH 2010
Year Ended Year Ended
SCHEDULE 31st March, 2010 31st March, 2009
(Rs.) (Rs.) (Rs.)
INCOME :
Income from Operations 13 2,691,520,215 2,640,219,098
Other Income 14 48,221,753 48,796,465
TOTAL 2,739,741,968 2,689,015,563
EXPENDITURE :
Purchase of Goods for Resale 2,016,208,390 2,725,448,711
Real Estate Business Purchases - 6,787,800
Administrative & Other Expenses 15 109,325,007 141,164,544
Finance Charges 16 11,784,221 64,640,307
Decrease / (Increase) in Stock 17 386,965,221 (330,950,619)
Depreciation 16,138,113 12,223,740
2,540,420,952 2,619,314,483
Profit for the year before Taxation 199,321,016 69,701,080
Exceptional Items - 24,266
Profit before Taxation 199,321,016 69,676,814
Provision for Taxation
Current Income Tax 67,057,283 36,789,033
Wealth Tax 580,000 739,000
Fringe Benefit Tax - 67,637,283 813,484
Deferred Tax (69,776) 1,402,974
131,753,509 29,932,323
Tax Provision in respect of earlier year(net) 180,199 (1,605,040)
Profit for the Year after Tax 131,933,708 28,327,283
Balance Brought Forward 154,435,456 152,827,743
Less: Loss of IIJL on amalgamation 2,528,970 151,906,486 -
Amount Available for Appropriations 283,840,194 181,155,026
Appropriations:
(1) Proposed Dividend 15,017,100 18,771,375
(2) Tax on Distributed Profits 2,494,152 3,190,195
(3) General Reserve 9,098,000 4,758,000
Balance carried to Balance Sheet 257,230,942 154,435,456
EARNINGS PER SHARE - Before Exceptional Items (Face Value Rs.2) 3.51 0.75
EARNINGS PER SHARE - BASIC & DILUTED (Face Value Rs.2) 3.51 0.75
Significant Accounting Policies and
Notes to the Accounts 18
As per our report attached For and on behalf of the Board of Directors
For K. S. Aiyar & Company V. K. Jatia
Chartered Accountants Chairman & Managing Director
Firm Reg. No. 100186W
Ajit P. Walwaikar Directors
G.M. (Legal) & Company Secretary R. Sethna A. Didwania
Satish Kelkar R. R. Doshi P. K. Bubna
Partner N. K. Deora Gauri Jatia Vasanti Patel
Financial Controller
Mumbai : 18th June, 2010 Mumbai : 18th June, 2010
SCHEDULE - 2
RESERVES AND SURPLUS :
Capital Redemption Reserve
As per last Balance Sheet 891,050 891,050
Capital Reserve
As per last Balance Sheet 23,876,566 24,609,466
Less: Amount Transferred during the year - 732,900
23,876,566 23,876,566
General Reserve
As per last Balance Sheet 10,434,000 6,951,000
Less: Amounts reversed during the year - 1,275,000
Amount Transferred during the year 9,098,000 4,758,000
19,532,000 10,434,000
Foreign Currency Translation Reserve
As per last Balance Sheet 11,424,053 (6,412,672)
Add: Amounts reversed during the year (9,356,989) 3,667,750
Add: Amounts transferred during the Year - 14,168,975
2,067,064.00 11,424,053
Profit & Loss Account 257,230,942 154,435,456
TOTAL 303,597,622 201,061,125
SCHEDULE - 3
SECURED LOANS: (Note No. 3)
From Banks:
Term Loans 464,873,156 642,565,306
Working Capital Borrowings 42,976,349 96,393,284
Car Finance Loans 3,781,734 2,853,866
511,631,239 741,812,456
From Others - 712,882
(Amounts due within one Year Rs. 18,12,74,284/-,
Previous Year Rs.18,32,67,504/-) 511,631,239 742,525,338
As at As at
31st March, 2010 31st March, 2009
(Rs.) (Rs.) (Rs.)
SCHEDULE - 4
UNSECURED LOANS :
(1) Deposits 101,193,892 197,574,942
(2) Short Term Loans from Limited Company 42,500,000 65,200,000
TOTAL 143,693,892 262,774,942
SCHEDULE - 5
FIXED ASSETS
PLANT & MACHINERY 57,240,815 35,122,635 - 92,363,450 36,329,089 7,658,759 - 43,987,848 48,375,602 20,911,726
FURNITURE & FITTINGS 30,287,483 218,315 - 30,505,798 17,738,554 2,175,005 - 19,913,559 10,592,239 12,548,929
VEHICLES 10,495,084 6,382,190 4,158,157 12,719,117 4,009,350 2,525,294 1,610,366 4,924,278 7,794,839 6,485,734
PREVIOUS YEAR 295,363,055 22,647,576 9,651,908 308,358,723 100,495,097 13,338,096 967,531 112,865,662 195,493,061
# Amount of Rs. 6,50,160/- is allocated under Pre - Operative Expenses and Rs. 10,07.677/- being Pre-Amalgamation depreciation of erstwhile IIJL for the period
01.04.2009 to 30.06.2009.
As at As at
31st March, 2010 31st March, 2009
(Rs.) (Rs.) (Rs.)
SCHEDULE - 6
INVESTMENTS : Other Investments
A. LONG TERM : At Cost (Unquoted)
a. Securities held for Trading Listed outside HongKong 2,318,905 8,657,883
b. Others - Fully Paid Up:
(i) 2,50,000 Equity Shares of Modern Derivatives &
Commodities Private Limited of Rs. 10/- each.
(Previous Year 2,50,000 Equity Shares of Rs. 10/- each) 2,500,000 2,500,000
(ii) 20,000 Equity Shares of The Shamrao Vithal Co-op Bank Ltd 500,000 500,000
of Rs. 25/- each. (Previous Year 20,000 Equity Shares of Rs.25/- each)
TOTAL 5,318,905 11,657,883
SCHEDULE - 7
INVENTORIES :
(As Technically Certified by the management)
Stores - At Lower of Cost & Net Realizable Value 1,135,365 1,286,851
Trading Goods - At lower of Cost and Net 8,022,550 334,782,932
Realisable Value
Real Estate Business:
(a) Land and Structures - At Book Value 42,487,350 41,522,447
(b) Unsold Flats - At lower of Cost and 25,158,000 76,633,610
Net Realisable Value
67,645,350 118,156,057
TOTAL 76,803,265 454,225,840
As at As at
31st March, 31st March,
2010 2009
(Rs.) (Rs.)
SCHEDULE - 9
CASH AND BANK BALANCES :
Cash on hand 943,697 1,240,113
Balances with Scheduled Banks
In Current Accounts 6,034,034 47,723,435
In Deposit Accounts 66,311,689 26,223,464
72,345,723 73,946,899
TOTAL 73,289,420 75,187,012
SCHEDULE - 10
LOANS AND ADVANCES :
(Unsecured Considered Good)
Advances Recoverable in Cash or
in kind or for value to be received 143,880,979 135,501,829
Loans to Limited Companies 31,400,000 168,000,000
Minimum Alternate Tax Credit Entitlement - 8,435,000
Income Tax payments including Tax Deducted at Source 120,348,673 132,412,154
Sundry Deposits 5,956,181 6,090,060
TOTAL 301,585,833 450,439,043
SCHEDULE - 11
CURRENT LIABILITIES
Acceptances (Note No. 3) 248,491,579 248,546,205
Sundry Creditors 67,402,253 556,657,216
Advances Received 23,060,783 13,989,462
Interest Accrued but not due on Loan 44,121 750,822
Investors Education and Protection Fund (Refer Note Below)
- Unclaimed Dividend 1,259,032 1,373,245
Other Liabilities 39,382,322 15,046,263
TOTAL 379,640,090 836,363,213
SCHEDULE - 12
PROVISIONS
Proposed Dividend 15,017,100 18,771,375
Tax on Distributed Profits 2,494,152 3,190,195
For Taxation 106,550,455 66,476,016
For Retirement Benefits 3,197,000 2,326,118
TOTAL 127,258,707 90,763,704
Note: There is no amount due and outstanding as at Balance Sheet date to be credited to Investors Education and Protection
Fund.
SCHEDULE - 13
INCOME FROM OPERATIONS
SALES:
(i) Traded Goods
- Export Sales - 76,530,908
- Local Sales 2,375,593,046 2,375,593,046 2,390,121,913
(ii) Real Estate Business 203,200,000 7,290,000
2,578,793,046 2,473,942,821
Service Charges Received 93,391,596 142,788,294
[Tax Deducted at source Rs. 1,76,20,670/-.
(Previous Year Rs. 52,41,375/-)]
Income from Business Centre 9,729,241 12,678,206
[Tax Deducted at source Rs. 2,09,34,697/-.
(Previous Year Rs. 1,34,96,750/-)]
Fees from Vocational Trainning Institute 4,629,443 6,729,777
[Tax Deducted at source Rs. 1,31,479/- (Previous Year Rs. 1,00,422/-)]
Income from Real Estate Business [Tax Deducted at 4,976,889 4,080,000
Source Rs. 5,39,564/- (Previous Year Rs. 5,36,272/-)]
TOTAL 2,691,520,215 2,640,219,098
SCHEDULE - 14
OTHER INCOME
Rent [Tax Deducted at source Rs. 81,92,691/- 39,785,013 30,497,913
(Previous Year Rs.1,09,86,190/-)]
Miscellaneous Income 7,923,517 16,761,724
[Tax Deducted at source Rs. 7,65,311/-
(Previous Year Rs. 2,849/-)]
Dividend on Long Term Investments 72,910 72,910
Provision no longer required Written Back 440,313 1,463,918.00
TOTAL 48,221,753 48,796,465
SCHEDULE - 15
INCREASE / (DECREASE) IN STOCK :
Opening Stock
Trading Goods 334,782,932 3,832,313
Add: Stock of IIJL on Amalgamation 1,621,785 -
336,404,717 3,832,313
Real Estate Business:
(a) Land and Structures 41,522,447 41,522,447
(b) Unsold Flats 76,633,610 91,484,376
Add: Renovation Expense 8,072,347 -
Less: Transferred during the year
to Fixed Assets - Buildings - 84,705,957 14,850,766
126,228,404 118,156,057
462,633,121 121,988,370
Closing Stock
Trading Goods 8,022,550 334,782,932
Real Estate Business:
(a) Land and Structures 42,487,350 41,522,447
(b) Unsold Flats 25,158,000 76,633,610
67,645,350 118,156,057
75,667,900 452,938,989
Increase / (Decrease) in Stock TOTAL (386,965,221) 330,950,619
SCHEDULE - 16
ADMINISTRATIVE AND OTHER EXPENSES :
Stores Consumed 258,363 175,986
Power & Fuel 1,973,788 2,032,775
Water Charges 1,216,985 685,477
Repairs to:
Machinery 846,661 536,883
Buildings 6,323,290 15,289,449
Others 2,725,123 348,725
9,895,074 16,175,057
Payment to and Provision for Employees
Salaries and Wages 27,146,611 22,307,373
Contribution to Provident and Other Funds 1,279,147 1,746,607
Gratuities 909,794 490,735
Voluntary Retirement Compensation -
Welfare Expenses 1,088,821 975,326
30,424,373 25,520,041
Travelling & Conveyance 3,795,461 3,060,235
Legal and Professional Charges 12,793,701 12,374,381
Donation 51,000 11,000
Real Estate Business Expenses 1,944,690 1,493,590
Directors Sitting Fees 295,000 235,000
Rent 106,632 28,447
Rates and Taxes 16,777,799 15,643,736
Insurance 6,463,841 6,550,020
Bad Debts Written Off - 2,065,539
Loss on Sale of Long Term Investments - 29,856,400
Loss on Sale of Fixed Assets 192,236 3,580
Auditors’ Remuneration:
- Audit Fees 527,071 563,637
- Tax Audit Fees 44,120 51,620
- In Other Capacity & out of pocket expenses 181,445 215,565
752,636 830,822
Brokerage 6,994,715 6,662,023
Advertisement Expenses 3,011,799 778,098
Miscellaneous Expenses 12,376,914 16,982,337
TOTAL 109,325,007 141,164,544
SCHEDULE - 17
FINANCE CHARGES:
(i) Interest on Fixed Loans 71,903,726 61,744,628
(ii) Other Interest & Financial Expenses 17,487,783 54,045,729
89,391,509 115,790,357
Less: Interest - Gross (Note No. 5)
[Tax Deducted at source Rs. 1,44,89,577/-
(Previous Year Rs. 1,54,18,362/-)] 77,607,288 51,150,050
TOTAL 11,784,221 64,640,307
SCHEDULE 18
SIGNIFICANT ACCOUNTING POLICIES AND NOTES ON BALANCE SHEET AND PROFIT AND LOSS ACCOUNT
1 SIGNIFICANT ACCOUNTING POLICIES:
(A) BASIS OF PREPARATION OF FINANCIAL STATEMENTS:
(i) The Financial Statements are prepared under the Historical Cost Convention on accrual basis.
(ii) The Financial Statements have been prepared to comply in all material respects with the applicable Mandatory
Accounting Standards.
(B) PRINCIPLES OF CONSOLIDATION:
The consolidated financial statements relate to Modern India Limited (‘The Company’), its wholly / partly owned
subsidiaries and its interest in joint Venture as on 31.03.2010 which are as under:
(i) The financial statements of the Company and its Subsidiary Companies have been combined on a line-by-line
basis by adding together the book values of like items of assets, liabilities, incomes and expenses after fully
eliminating intra - group balances and intra - group transactions in accordance with Accounting Standard (AS
- 21) - “Consolidated Financial Statements”.
(ii) Interest in Joint Venture have been accounted by using the proportionate consolidation method as per Accounting
Standard (AS - 27) - “Financial reporting of Interest in Joint Venture”.
(iii) The consolidated financial statements have been prepared using uniform accounting policies for like transactions
and other events in similar circumstances and are presented to the extent possible, in the same manner as the
Company’s separate financial statements.
(iv) Financial statements of Foreign Subsidiary has been converted in Indian Rupees at the following Exchange
Rate.
(a) Revenues and Expenses: At the average exchange rate during the year.
(b) Current Assets and Current Liabilities: At Exchange Rate prevailing at the end of the year.
(c) Fixed Assets : At Exchange rate prevailing at the end of the year.
(i) Sales of flats are accounted at contracted rate on handing over the possession. Sales of Traded Goods are
recognized on transfer of significant risk and rewards of ownership which is generally on the dispatch of goods
and are recorded net of VAT.
(ii) Income other than Sales is recognized, wherever applicable, in terms of agreements with concerned parties.
(iii) Interest income is recognized on time proportion basis taking into account the amount outstanding and rate
applicable. Dividend income is recognized when the right to receive dividend is established.
(iv) Income from Vocational Training Fees is recognized on the basis of completed period in respect of each course
/ semester as compared with the total duration of the same.
(D) INVENTORIES are valued as under:
(i) Trading Goods : At lower of Cost and Net Realizable Value
(ii) Stores : At lower of Cost and Net Realizable Value
Cost is arrived at on FIFO basis and includes costs incurred in bringing the inventories to their present location and
condition.
(iii) Real Estate Business:
(a) Land and Structures : At Book Value
(b) Flats Unsold : At lower of Cost and Net Realizable Value
(E) SEGMENT REPORTING:
(a) Revenue and expenses have been identified to segments on the basis of their relationship to the operating
activities of the segment. Revenue and expenses, which relate to the enterprise as a whole and are not
allocable to segments on a reasonable basis have been included under “Unallocable / Corporate”.
(F) PROVISIONS & CONTINGENCIES:
A Provision is recognized when there is a present obligation as a result of a past event if it is probable that an outflow
of resources will be required to settle the obligation and in respect of which reliable estimates can be made.
Provisions are not discounted to their present value and are determined based on the best estimate required to settle
the obligation at the year end date. These are reviewed at each year end date and adjusted to reflect the best
current estimate. Contingent Liabilities are not recognized but are disclosed in the Notes. Contingent Assets are
neither recognized nor disclosed in the financial statements. Contingencies are disclosed after careful evaluation as
per Accounting Standard - 29 issued by The Institute of Chartered Accountants of India.
(G) IMPAIRMENT OF ASSETS:
An asset is treated as impaired when the carrying cost of asset exceeds its recoverable amount. An impairment loss
is charged to the profit and Loss Account in the year in which an asset is identified as impaired. The impairment loss
recognized in prior accounting period is reversed if there has been a change in the estimate of recoverable amount.
(H) OTHER SIGNIFICANT ACCOUNTING POLICIES:
These are set out in the notes to accounts under “Significant Accounting Policies” of the respective financial
statements of the Company and the subsidiaries.
2 Contingent Liabilities not provided for: Current Year Previous Year
(Rs.) (Rs.)
(i) Claims against the Company not Acknowledged as debts. 304,351 250,000
(ii) Estimated amount of Contracts remaining to be executed on
Capital Account and not provided for (Net of advances given) - 1,987,584
(iii) Corporate Guarantees given by the Company to
Indian Overseas Bank, Hong Kong on behalf of
Wholly Owned Subsidiary
M/s. Modern International (Asia) Limited. 451,023,300 509,597,400
(iv) Sales Tax Liability in respect of which Appeals are pending. 1,648,781 1,648,781
(v) Property Tax Demand raised by
Municipal Corporation of Greater Mumbai (MCGM). 55,041,736 27,520,868.00
The Company has disputed and has filed a complaint
3 Working Capital borrowings from Banks and Acceptances are secured by hypothecation of stocks of trading goods, book
debts and assignment of Key Man Insurance Policy and are also secured by mortgage of part of Land and Building at
Mahalaxmi, Mumbai. Car Finance Loans from Bank are secured by hypothecation of specific vehicles acquired. Term
Loans from Banks are secured by assignment of rental receivable and also by mortgage of (i) part of Land and Building
at Mahalaxmi, Mumbai and (ii) Residential Flats.
4 There is no Micro and Small Enterprise to whom the Company owes dues, which are outstanding for more than 30 days
as at the Balance Sheet date. Further, the Company has not paid any interest to any Micro and Small Enterprise during
the accounting year, nor is any interest payable to any Micro and Small Enterprise on the Balance Sheet Date. This
information as required to be disclosed under the Micro, Small and Medium Enterprises Development Act, 2006 has
been determined to the extent such parties have been identified on the basis of information available with the Company.
5 Interest consists of interest on loans, deposits and interest on Income Tax Refund, etc.
6 The balances of Sundry Debtors, Loans and Advances and Sundry Creditors are subject to confirmations from some of the
parties.
7 Karnataka Industrial Area Development Board which had originally allotted 20 acres of land for setting up an industrial
unit at Raipur Industrial Area, Dharvad subsequently restricted the same to 6 acres. Against this, the Company had filed
a Writ Petition in Karnataka High Court for the full allotment as per the Original Allotment which has since been dismissed
by the order of single judge bench. The Company has filed an appeal before the full bench to set aside this order which
is pending for disposal. In the meanwhile, the Company has entered into a Memorandum of Understanding with a party
to do all the required formalities in connection with full allotment of the land and eventual disposal of the said land.
8 Deferred Tax :
(a) The break up of Net Deferred Tax Asset / (Liabilities) as on 31st March, 2010 is as under:
Deferred Tax Assets As At As At
31.03.2010 31.03.2009
(i) Expenditure under section 43B of the Income Tax Act, 1961 440,165 366,752
(ii) Long Term Capital Loss 14,497 453,200
(iii) Others 735,561 354,176
Total Deferred Tax Assets 1,190,223 1,174,128
Deferred Tax Liabilities
(i) Difference between book and Tax Depreciation 11,740,816 10,378,281
(ii) Capital Gains Tax Liability 684,468 2,100,684
Total Deferred Tax Liability 12,425,284 12,478,965
Net Deferred Tax Assets / (Liabilities) (11,235,061) (11,304,837)
(b) Rs. 69,776/- (Previous Year Rs. 14,02,974/ debited-) has been creted to Profit and Loss Account of the Year in respect
of Deferred Tax.
9 Managing Director’s Remuneration:
Current Year Previous Year
Rupees Rupees
(i) Salary 2,100,000 2,100,000
(ii) Contribution to Provident Fund 252,000 252,000
(iii) Commission 6,803,622 1,014,594
(iv) Perquisites 1,061,656 1,338,726
Other particulars relating to Management Pension, Post Retirement Medical Benefits and Pension Plan are not applicable
to the Company.
10 Segment Information for the Year ended 31st March, 2010.
Primary Segment reporting - Business Segments
Amount (Rupees)
Particulars Business Vocational Real Trading Unallocable/ Total
Centre Trainning Estate Corporate
A) Segment Revenue:
External Sales / Income from Operations 103120837 6546840 208176889 2373675649 - 2691520215
B) Segment Results:
Profit / (Loss) before Depreciation, Taxes and exceptional items 94700704 (7223837) 145126941 12223475 (26356355) 218470928
Profit / (Loss) before Taxes and Exceptional items 90840487 (11511805) 145041594 12223475 (34260936) 202332815
C) Other Information:
Depreciation - - - - -
Notes:
1) The Company has identified Business Segments as primary segments. The Reportable Business Segments are: a)
Business Center - comprising of activities connected with running of Business Centre, b) Vocational Training Institute -
comprising of activities connected with Training for all the facets of Jewellery Industry and Gem Testing Laboratory etc.
c) Trading - Consists of Trading in all Products and d) Real Estate - comprising of Property Development and carrying on
business or activities in real estate business of all types.
2) Items of Revenue, Income and Expenses, Assets and Liabilities (including Borrowings, Provision for Taxation and
Deferred Tax) which are not directly attributable / identifiable / allocable to business segments are shown as Unallocated
/ Corporate.
Note: In respect of above parties, there is no provision for doubtful debts as on March 31, 2010 and no amount has been
written off or written back during the year in respect of debts due from / to them.
ii) Related Party Transactions:
Nature of Transactions Significant Key Relatives of Key Total
Influence Management Management
Personnel Personnel
(Rs.) (Rs.) (Rs.) (Rs.)
As per our report attached For and on behalf of the Board of Directors
For K. S. Aiyar & Company V. K. Jatia
Chartered Accountants Chairman & Managing Director
Firm Reg. No. 100186W
Ajit P. Walwaikar Directors
G.M. (Legal) & Company Secretary R. Sethna A. Didwania
Satish Kelkar R. R. Doshi P. K. Bubna
Partner N. K. Deora Gauri Jatia Vasanti Patel
Financial Controller
Mumbai : 18th June, 2010 Mumbai : 18th June, 2010
CASH FLOW STATEMENT FOR THE YEAR ENDED 31ST MARCH, 2010.
(Rs. in Lacs)
A. Cash Flow From Operating Activities: 2009-2010 2008-2009
Net Profit Before Tax and Extraordinary Items 1,993.21 696.77
Add / (Less) :
Depreciation 161.38 122.24
Loss on Sale of Investments 298.56
Dividend Income (0.73) (0.73)
Interest Income (776.07) (511.50)
Loss on sale of Fixed Assets 1.92 0.04
Interest Expenses 893.92 1157.9
Non Cash Expenses - 0.32
280.42 1066.83
Operating Profit/(Loss) before working Capital Changes 2,273.63 1763.60
Inventories 3,758.01 (3,113.02)
Trade Receivables 1946.71 (1,219.32)
Other Receivables 1442.45 (2,165.93)
Liabilities (4557.12) 2,590.05 4,083.79 (2,414.48)
Cash Generated from Operations 4,863.68 (650.88)
Direct Taxes Paid (Net) 120.63 (624.04)
Net Cash Generated/(Used) in Operating Activities 4,984.31 (1,274.92)
B. Cash Flow from Investing Activities:
Purchase of Fixed Assets (438.08) (458.54)
Pre Amalgamation Loss (25.29) (104.15)
Pre - Operative Expenses (727.00) (1,110.00)
Sale of Fixed Assets 23.56 5.60
Sale of Investment - 149.56
Dividend Received 0.73 0.73
Interest Received 776.07 (390.01) 511.5 (1,005.30)
Net Cash Used in Investing Activities (390.01) (1,005.30)
C. Cash Flow from Financing Activities:
Proceeds from Bank Borrowings (1,767.64) 3,105.69
Proceeds from Short Term Borrowings (1,732.11) 783.10
Interest Paid (893.92) (1,150.39)
Dividend Paid (219.61) (4,613.28) (76.49) 2,661.91
Net Cash from Financing Activities (4,613.28) 2,661.91
Net Increase/(Decrease) in Cash and Cash Equivalents (A+B+C) (18.98) 381.69
Opening Balance of Cash and Cash Equivalents 751.87 370.18
Closing Balance of Cash and Cash Equivalents 732.89 751.87
Net Increase/(Decrease) as disclosed above (18.98) 381.69
As per our report attached For and on behalf of the Board of Directors
For K. S. Aiyar & Company V. K. Jatia
Chartered Accountants Chairman & Managing Director
Firm Reg. No. 100186W
Ajit P. Walwaikar Directors
G.M. (Legal) & Company Secretary R. Sethna A. Didwania
Satish Kelkar R. R. Doshi P. K. Bubna
Partner N. K. Deora Gauri Jatia Vasanti Patel
Financial Controller
Mumbai : 18th June, 2010 Mumbai : 18th June, 2010
PROXY
I/We
of or failing him
Dated
Folio No.
*DP ID Revenue
Stamp
*CI. ID No. 15 Paise
No. of Shares
Signature
Note: Proxies must reach the Company’s Registered Office not less than 48 hours before the meeting.
Dated
Folio No.
*DP ID
*CI. ID No.
No. of Shares
I hereby record my presence at the SEVENTY-SIXTH ANNUAL GENERAL MEETING at the Registered Office of the
Company at Modern Centre, Sane Guruji Marg, Mahalaxmi, Mumbai 400 011 on Friday, the 30 th July, 2010 at
3.00 p.m.
Member’s/Proxy’s Signature
* Applicable to investors holding shares in electronic form.
ORDINARY BUSINESS
1. To receive, consider and adopt the Balance Sheet as at 31st March, 2010 and the Profit & Loss Account for the year ended
as on that date and the Reports of the Directors and the Auditors thereon.
2. To declare dividend on the Equity Shares for the year ended 31 st March, 2010.
3. To appoint a Director in place of Shri. Pradip Kumar Bubna, who retires from office by rotation and being eligible, offers
himself for re-appointment.
4. To appoint a Director in place of Shri. Rajas R. Doshi, who retires from office by rotation and being eligible, offers himself
for re-appointment.
5. To appoint Auditors of the Company to hold office from the conclusion of this meeting until the conclusion of the next
Annual General Meeting of the Company, and to fix their remuneration, and for that purpose, to pass the following
Resolution, as an Ordinary Resolution:
“RESOLVED that pursuant to the provisions of Section 224 and other applicable provisions, if any, of the Companies Act,
1956, Messrs. K.S. Aiyar & Company, Chartered Accountants, the retiring Auditors, be and are hereby re-appointed as the
Auditors of the Company to hold office from the conclusion of this Meeting until the conclusion of the next Annual
General Meeting of the Company and that the Board of Directors of the Company be and is hereby authorized to fix their
remuneration for the said period and reimbursement of actual out of pocket expenses, as may be incurred in the
performance of their duties.”
NOTES:
1) A MEMBER ENTITLED TO ATTEND AND VOTE AT THE ANNUAL GENERAL MEETING (THE MEETING) IS ENTITLED TO
APPOINT A PROXY TO ATTEND AND VOTE ON A POLL INSTEAD OF HIMSELF AND THE PROXY NEED NOT BE A
MEMBER OF THE COMPANY. THE INSTRUMENT APPOINTING A PROXY SHOULD, HOWEVER, BE DEPOSITED AT THE
REGISTERED OFFICE OF THE COMPANY NOT LESS THAN FORTY-EIGHT HOURS BEFORE THE COMMENCEMENT OF
THE MEETING.
3) Corporate Members intending to send their authorized representatives to attend the Meeting are requested to send a
certified copy of the Board Resolution authorizing their representative to attend and vote on their behalf at the Meeting.
4) In terms of Article 112 of the Articles of Association of the Company, Shri. Pradip Kumar Bubna and Shri. Rajas R. Doshi,
retire by rotation at the ensuing Annual General Meeting and being eligible offer themselves for re-appointment. Brief
resume of these Directors, nature of their expertise in specific functional areas and names of companies in which they
hold directorships and memberships/chairmanships of Board Committees, as stipulated under Clause 49 of the Listing
Agreement with the Bombay Stock Exchange Limited, are provided in the Report on Corporate Governance forming part
of the Annual Report along with this Notice.
5) Members are requested to bring their Attendance Slip along with their copy of Annual Report to the Meeting.
6) Members who hold shares in dematerialized form are requested to write their Client ID and DP ID Numbers and those who
hold shares in physical form are requested to write their Folio Number in the Attendance Slip for attending the Meeting.
7) The Register of Members and Share Transfer Books of the Company will remain closed from Tuesday, the 20th July, 2010
to Friday, the 30th July, 2010 (both days inclusive) for determining the names of members eligible for the dividend on
Equity Shares, if declared at the Annual General Meeting.
a. as Beneficial Owners as at the end of business on 30th July, 2010 as per the list provided by National Securities
Depository Limited and Central Depository Services (India) Limited in respect of the shares held in the electronic
form and
b. As Members in the Register of Members of the Company after giving effect to valid transfers in physical form lodged
with the Company on or before 19th July, 2010.
9) In order to provide protection against fraudulent encashment of dividend warrants, Members are requested to intimate
the Company’s Registrars & Transfer Agents particulars of their Bank Account viz. Name of Bank, , Name of Branch,
Complete address of the Bank with Pin Code Number, Account type – whether Saving Account or Current Account and
Bank Account Number.
10) Members are hereby informed that Dividend which remains unclaimed/un-encashed over a period of 7 years has to be
transferred as per the provisions of Sec.205A of the Companies Act, 1956, by the Company to ‘The Investor Education &
Protection Fund’, constituted by the Central Government under Section 205C of the Companies Act, 1956. It may please
be noted that once the unclaimed/un-encashed dividend is transferred to the “Investor Education & Protection Fund”(IEPF),
no claim shall lie in respect of such amount by the shareholder. The unclaimed Dividend for the year 2002-2003 is due
to be transferred to the IEPF on August 13, 2010. Members wishing to claim dividends, which remain unclaimed for the
year 2002-2003 and onwards, are requested to correspond with the Company’s Registrars & Transfer Agents, along with
full particulars.
11) Members desirous of making nomination as permitted under Section 109A of the Companies Act, 1956 in respect of the
physical shares held by them in the Company, can make nominations in Form 2B. The Members holding shares in demat
form may contact their respective depository participants for such nominations.
12) Members who hold shares in physical form in multiple folios in identical names or joint accounts in the same order of
names are requested to send the share certificates to the Company’s Registrars and Transfer Agents, M/s. Satellite
Corporate Services Private Limited, for consolidation into a single folio.
13) It has been observed that some members have still not surrendered their old Share Certificates for Equity Shares of Rs 50/
- each for exchange with the then new Share Certificates for Equity Shares of Rs 10/- each.
Subsequently, the Company has further sub-divided its Equity Shares of Rs.10/- each in 5 Equity Shares of Rs.2/- each,
on February 1, 2008.
The Members are once again requested to surrender the old Share Certificates for Equity Shares of Rs 50/- each or
Rs.10/- each, as the case may be, to the RTA or the Company to exchange for the Equity Shares of Rs.2/- each.
14) As per the approval granted by the Central Government under section 212(8) of the Companies Act, 1956, copy of
Balance Sheet, Profit and Loss Account, Report of the Board of Directors and the Report of the Auditors of the Subsidiary
Companies are not attached with the Annual Report of the Company. However, the Annual Reports of all the Subsidiary
Companies are available for inspection at the Registered Office of the Company to any member/investor of the Company.
Further, the Company will make available these documents to any member/investor upon request.
Registered Office:
Modern Centre,
Sane Guruji Marg,
Mahalaxmi,
Mumbai - 400 011.