VITAN DEPARTMENTAL STORES AND INDUSTRIES LIMITED Report/Vitan... · VITAN DEPARTMENTAL STORES AND...

VITAN DEPARTMENTAL STORES AND INDUSTRIES LIMITED

26TH ANNUAL REPORT

FOR THE YEAR ENDED

31ST MARCH, 2013

VITAN DEPARTMENTAL STORES & INDUSTRIES LIMITED

Board of Directors : Mr. V.P. CHOKHANI

Mr. ANANDAN RANGANATHAN

Mr. RAMESH GOVINDARAJAN

Mr. DINANATH SHYAMSUNDAR

Registered Office : No. 21, Spur Tank Road, Chetpet, Chennai – 600 031

Bankers : HDFC Bank

Auditor : For FY 2012-13

C. Ramasamy& B. Srinivasan

Chartered Accountants

Chennai – 600 026

For FY 2013-14

M/s. N. Kanodia& Co.,


43, Dobson Road,

Howrah – 711 101

VITAN DEPARTMENTAL STORES & INDUSTRIES LTD 26th Annual Report

[2012-13] Page 1

NOTICE OF ANNUAL GENERAL MEETING

Notice is hereby given that Annual General Meeting of the members of VITAN DEPARTMENTAL STORES & INDUSTRIES LIMITED, will be held on Monday, 23rd day of December, 2013 at 11.00 A.M. at the registered office of the Company to transact the following Businesses: Ordinary Business:

Item 1: ADOPTION OF ACCOUNTS:

To consider and adopt the Balance Sheet as on 31 March, 2013 and Profit and Loss Account for the year ended 31 March, 2013 and the Report of the Board of Directors and Auditors thereon.

Item 2: APPOINTMENT OF DIRECTOR IN PLACE OF RETIRING DIRECTOR V. P.

CHOKHANI:

To appoint a Director in place of V. P. Chokhani, who retires by rotation and being eligible offers himself for re-appointment? Item 3: APPOINTMENT OF AUDITORS:

To appoint auditors to hold office from the conclusion of this AGM until the conclusion of the next AGM and to pass the following resolution thereof: “RESOLVED THAT M/s. N.Kanodia& Co., Chartered Accountants, be and are hereby appointed as auditors of the Company in place of auditors M/s. C.Ramasamy&B.Srinivasan, who have resigned, to hold office from the conclusion of this AGM to the conclusion of next AGM on such remuneration as may be determined by the Board of Directors”

SPECIAL BUSINESS:

Item 4: ALTERATION OF ARTICLES OF ASSOCIATION:

To consider and, if thought fit to pass with or without modification, the following resolution as a Special Resolution: “FURTHER RESOLVED THAT pursuant to the provisions of Section 31 and other applicable provisions if any of the Companies Act 1956 the Articles of Association of the Company be and are hereby altered by inserting Article 3 by replacing the existing Article 3 and by inserting a new Article 4A after existing Article 4. The newly inserted Article 3 and 4A are as under:

3. SHARE CAPITAL The authorized capital of the Company shall be as stated in clause 3 of the Memorandum of Association of the Company from time to time.”

4A. DEMATERIALISATION OF SECURITIES

For the purpose of this article `Beneficiary Owner’ means a person or persons whose name is recorded as such with a depository; `SEBI’ means Securities Exchange Board of India; `Depository’ means a company framed and registered under the Companies Act, 1956, and which has been granted a certificate of registration to act as a depository under the Securities Exchange Board of India Act, 1992; and `Security’ means such security as may be specified by the SEBI board from time to time.


[2012-13] Page 2

Notwithstanding anything contained in these Articles, the Company shall be entitled to dematerialize its securities and to offer securities in a dematerialised form pursuant to the Depositories Act, 1996. Every person subscribing to securities offered by the company shall have the option to receive security certificate or to hold securities with a depository. Such a person who is the beneficial owner of the securities can at any time opt out of a depository, if permitted by law, in respect of any security in the manner provided by the Depositories Act, and the company shall, in the manner and within the time prescribed issue to the beneficial owner the required certificate of securities. If a person opts to hold his security with a depository, the company shall intimate such depository the details of allotment of the security, and on receipt of the information, the depository shall enter in its record the name of the allottee as the beneficial owner of the security. All securities held by a depository shall be dematerialized and be in fungible form. Nothing contained in sections 153, 153A, 153B, 187A, 187B, 187C and 372 of the Act shall apply to a depository in respect of the securities held by it on behalf of the beneficial owners.

a) Notwithstanding anything to the contrary contained in the Act or these Articles, depository

shall be deemed to be the registered owner for the purpose of effecting transfer of ownership

of security on behalf of the beneficial owner.

b) Save and as otherwise provided in (a) above, the depository as registered owner of the

securities shall not have any voting rights or any other rights in respect of securities held by

it.

c) Every person holding securities of the Company and whose name is entered as the beneficial

owner in the records of the depository shall be deemed to be a member of the Company. The

beneficial of securities shall be entitled to all the rights and benefits and be subject to all the

liabilities in respect of these securities, which are held by a depository.

Notwithstanding anything in the act or these Articles to the contrary, where securities are held in a depository, the records of the beneficial ownership may be served by such depository on the Company by means of electronic mode or by delivery of discs. Nothing contained in Section 108 of the Act or these Articles shall apply to a transfer or securities effected by a transferor and transferee both of whom are entered as beneficial owner in the records of a depository. Notwithstanding anything in the Act or these Articles, where a depository deals with securities, the Company shall intimate the details thereof to the depository immediately on allotment of such securities. Nothing contained in the Act or these Articles regarding the necessity of having distinctive number for securities issued by the Company shall apply to securities held with a depository. The Register and Index of beneficial owner maintained by a depository under the Depositories Act, 1996, shall be deemed to be the Register and Index of Members and Security holders for the purpose for these Articles.” ITEM 5: INCREASE IN AUTHORISED SHARE CAPITAL OF THE COMPANY:

To consider and, if thought fit to pass with or without modification, the following resolution as aOrdinary Resolution: “RESOLVED THAT pursuant to section 94 and other applicable provisions if any of the Companies Act 1956, the authorized share capital of the Company be increased from present Rs.5,00,00,000/- (Rupees Nine Crores only) consisting of 50,00,000 equity shares of Rs.10/- each to Rs.10,00,00,000/- (Rupees Ten Crores only) divided into 1,00,00,000 equity shares of Rs.10/- each ranking paripassu with the existing equity shares of the Company in all respects.”


[2012-13] Page 3

“RESOLVED FURTHER THAT the Board of Directors be and is hereby severally authorised to do and perform all such acts, deeds and things including filing necessary returns with the Ministry of Corporate Affairs, as may be necessary or desirable to give effect to this resolution” ITEM 6: ALTERATION OF MEMORANDUM OF ASSOCIATION:

To consider and, if thought fit to pass with or without modification, the following resolution as ordinary Resolution: “RESOLVED THAT pursuant to the provisions of Section 16 and other applicable provisions if any of the Companies Act 1956 the Memorandum of Association of the Company be and is hereby altered by substituting the existing clause 3 as under: “3. The authorized share capital of the company is Rs.10,00,00,000/- (Rupees Ten Crores only) consisting of 1,00,00,000 (one crore) equity shares of Rs.10/- (Rupees Ten Only).” Item No. 7: PREFERENTIALALLOTMENT OF SHARES:

To consider and, if thought fit to pass with or without modification, the following resolution as a Special Resolution: RESOLVED that pursuant to Section 81(1A) and other applicable, provisions, if any, of the Companies Act, 1956 (including any amendment thereto or re-enactment thereof), subject to the provisions of Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2009 (hereinafter referred to as ‘SEBI(ICDR) Regulations’) and in accordance with the existing Guidelines, Rules, and Regulations of the Securities and Exchange Board of India (‘SEBI’) including the SEBI(Substantial Acquisition of Shares and Takeovers) Regulations, 2011 and enabling provisions of the Memorandum and Articles of Association of the Company and the Listing Agreement entered into with the stock exchanges where the securities of the Company are listed and also subject to such approvals, consents and permissions as may be necessary, of the appropriate authorities, instructions or bodies (including SEBI and relevant Stock Exchanges where the securities of the company are listed) and subject to such terms, conditions, alterations, corrections, changes, variations and / or modifications, if any, as may be prescribed by any authority while granting such approvals, consents of the members be and is hereby accorded to the Board to offer, issue and allot upto 50,00,000 Equity shares of the face value of Rs. 10/- each fully paid up for cash on preferential basis to persons/ entities belonging to Non-Promoter category at an issue price of Rs. 15/ per share (including premium of Rs.5) per share computed in accordance with the SEBI (ICDR) Regulations and any amendments thereto, or such other price as may be determined in accordance with the SEBI (ICDR) Regulations and an amendments thereto, or such other price as may be determined in accordance with the SEBI (ICDR), Regulations, on such terms and conditions as may be finalized by the Board/Committee of the Board RESOLVED FURTHER THAT the Relevant Date as per the SEBI (ICDR) Regulations, 2009, as amended up to date, for the determination of issue price of the equity shares is November 22, 2013 being the date which is 30 days prior to the date of Annual General Meeting, i.e. December 23, 2013. RESOLVED FURTHER THAT aforesaid issue of equity shares shall be subject to the following terms and conditions:

a) Equity shares to be allotted share be under lock in for such period as prescribed by the SEBI

(ICDR) Regulations, 2009.

b) The equity shares shall be allotted within a period of 15 days from the date of passing this

resolution provided where the allotment of the equity shares is pending on account of


[2012-13] Page 4

pendency of any approval of such allotment by any regulatory, stock exchange or Central

Government, the allotment shall be completed within a period of 15 days of such approval.

FURTHER RESOLVED THAT the equity shares proposed to be so allotted shall rank in paripassu in all respects including as to dividend with the existing fully paid equity shares of face value of Rs. 10/- each of the Company, subject to the relevant provisions contained in the Memorandum and Articles of Association of the Company. FURTHER RESOLVED THAT for the purpose of giving effect to this resolution, the Directors of the Company be and are hereby severally authorized to do all such acts, deeds, matters and things as it may in its absolute discretion deem necessary, desirable or expedient including listing of shares with the Stock Exchanges, to resolve and settle any questions and difficulties that may arise in the proposed issue, offer and allotment of the said securities, utilization of issue proceeds, signing of all deeds and documents as may be required without being required to seek any further consent or approval of the shareholders. RESOLVED FURTHER THAT the Board/ Committee of the Board/person authorized by the Board be and is hereby severally authorized to delegate all or any of the powers herein conferred by this resolution to any Director/s or to any Committee of Directors, including obtaining requisite consents from the allottees and filings of documents requisite for Listing and Trading approval from the designated stock exchanges etc and to give effect to this resolution” ITEM No. 8: CHANGE OF NAME:

To consider and, if thought fit, to pass, with or without modification, the following Resolution as a Special Resolution: “RESOLVED THAT pursuant to the provisions of the Companies Act, 1956 and subject to the approval of the Central Government, the Members of the Company hereby accord their approval for changing the name of the Company from ‘Vitan Departmental Stores & Industries Limited’ to ‘Vitan Agro Industries Limited’ or such other name with the prefix ‘Vitan Agro’ as may be approved by the Central Government/ Registrar of Companies. RESOLVED FURTHER THAT the Board of Directors of the Company be and is hereby authorised to decide the date, time and manner of filing the application with the Central Government/Registrar of Companies for seeking their approval to change the name of the Company and to do all such acts, deeds and things as may be deemed expedient and necessary in their absolute discretion to give effect to this Resolution in the best interests of the Company. “RESOLVED FURTHER THAT upon the change of name of the Company becoming effective, the name ‘Vitan Departmental Stores & Industries Limited’ wherever it occurs in the Memorandum and Articles of Association be substituted by the name ‘Vitan Agro Industries Limited’ or such other name with the prefix ‘Vitan Agro’ as may be approved by the Central Government/ Registrar of Companies.”

ITEM No. 9: APPOINTMENT OF SHYAM SUNDAR AS DIRECTOR:

“RESOLVED THAT Mr ShyamSundar, who was appointed as an Additional Director on November, 14, 2013 on the Board of the Company in terms of Section 260 of the Companies Act, and who holds office up to the date of this Annual General Meeting, and in respect of whom a notice has been received from a Member in writing, under Section 257 of the Companies Act, 1956, proposing his candidature for the office of a Director, be and is hereby appointed as a director of the company.”


[2012-13] Page 5

Notes: a. A Member entitled to attend and vote, is entitled to appoint a proxy to attend and vote instead of

himself and the proxy need not be a member.

b. The Instrument appointing a proxy shall be deposited at the Registered Office of the Company

not less than 48 hours before the time for holding the aforesaid meeting.

c. The Register of Members and Transfer Books of the Company will remain closed from

Wednesday 18 December, 2013 to 23 December, 2013 (both days inclusive).

d. Members/Proxies should bring the Attendance Slip sent herewith duly filled in for attending the

meeting.

e. The Ministry of Corporate Affairs (vide circular nos. 17/2011 and 18/2011 dated April 21, 2011

and April 29, 2011 respectively) has undertaken a Green Initiative in Corporate Governance and

allowed Companies to share documents with its shareholders through an electronic mode. A

recent amendment to the Listing Agreement with the Stock Exchanges permits companies to send

soft copies of the Annual Report to all those shareholders who have registered their email

addresses for the said purpose. Hence Members are requested to register their e-mail addresses

with the Company by sending their details relating to name, folio no./DP Id/Client Id to the

company’s email id : [email protected]

f. Members are requested to notify immediately any change in their address to the company at the

registered office.

g. Members who hold shares in physical form are requested to dematerialize their holdings to make

the Company’s shares traded in normal segment.

h. The relevant explanatory statement pursuant to section 102 of the Companies Act, 2013 in

respect of the business under Item No. 4,5,6,7, 8 and 9 is attached herewith.

i. Calls in arrears on fully called up shares which have not been paid from 1995 shall be forfeited

by the Board of Directors without giving any further intimation. (two advertisements have

already been made to obtain the calls in arrears)

j. Mr. Ramesh Govindrajan was appointed as additional director of the Company on 27 March,

2013. Further, being an additional director his tenure comes to an end at the ensuing AGM. Till

the date of this notice, no notice has been received from a Member in writing, under Section 257

of the Companies Act, 1956, proposing his candidature for the office of a Director. Hence, his

Directorship shall cease at this ensuing AGM.

k. All the existing shareholders of the Company are hereby requested to surrender their existing

share certificates to the company on or before 23thDecember, 2013 and thereafter fresh share

certificates shall be issued in lieu of the old existing share certificates.

l. Information pursuant to Clause 49 of the Listing Agreement for appointment of Director:

Item No.2: Mr. V. P. Chokhani possesses knowledge of various aspects of administration and is conversant with management and accounts of companies. He is in the Board of the Company for the last 26 years and his experience is of immense help to the Board in its smooth functioning. He is director in Saman Exports Limited, Abhimanyu Exports Limited, Chokhani Investments Ltd, Sion Marketing Private Limited, Debas Mercantile Private Limited and Trans Sales Private Limited. He holds 45,000 shares in Vitan Departmental Stores & Industries Limited.


[2012-13] Page 6

Item no. 9: Mr. ShyamSundar possesses knowledge of various aspects of administration and is conversant with management and accounts of companies. He is in the Board of M/s. OnesourceTechmedia Limited, M/s. SubhLabh Share Brokers Private Limited and M/s. Nochi Industries Private Limited. He doesn’t Hold any shares in Vitan Departmental Stores & Industries Limited.

Place: Chennai

For and on behalf of the Board

Sd/- ANANDAN RANGANATHAN

Date : 14/11/2013 Director

EXPLANATORY STATEMENT PURSUANT TO THE PROVISIONS OF SECTION 102 OF

THE COMPANIES ACT, 2013 FOR ITEM NO.4, 5, 6, 7,8 and 9.

ITEM NO 4: ALTERATION OF ARTICLES OF ASSOCIATION:

The company is seeking massive expansion plans to increase its operations and thereby augment its revenue options. This massive expansion is proposed to be funded through allotment of equity shares. The Articles of the Company should be in line with the modern changes that are brought by the Regulatory bodies and therefore the dematerialization clause is proposed by the Board to be inserted in the Articles. Further the Board proposes to alter the capital clause to allow the Company to increase the authorized capital without altering the Articles of Association. To carry out the above mentioned alterations the consent of the members is required and hence the Board proposes the resolution before the members to pass the resolution as a special resolution. The altered copy of the Articles of Association shall be kept in the registered office of the Company for inspection by the members during business hours till the date of the AGM. None of the Directors or key managerial personnel of the company or their relatives are interested in this resolution. ITEM NO 5 and 6: INCREASE IN AUTHORISED SHARE CAPITAL OF THE COMPANY

AND ALTERATION OF MEMORANDUM OF ASSOCIATION:

The Company is taking steps for massive expansions to increase its scale of operations and businesses and increase its revenue. To do the same it needs infusion of fresh funds and the Board intends to issue equity shares, however the same can only be done only after increasing the authorized share capital and therefore the share capital can be altered only after the approval of the members as ordinary resolution. The alteration of capital clause in the memorandum of association is consequent increase in share capital of the Company. Further the alteration of Memorandum of Association also requires the approval of the members of the Company and the presents both the resolutions before the members for their approval. The altered copy of the Memorandum of Association shall be kept in the registered office of the Company for inspection by the members during business hours till the date of the AGM. None of the Directors or key managerial personnel of the company or their relatives are interested in this resolution.

ITEM 7: PREFERENTIAL ALLOTMENT OF SHARES

THE INFORMATION AS REQUIRED UNDER CLAUSE 73 OF CHAPTER VIIOF SECURITIES AND EXCHANGE BOARD OF INDIA (ISSUE OF CAPITAL AND DISCLOSURE REQUIREMENTS) REGULATIONS, 2009 FOR PREFERENTIAL ISSUES ARE AS UNDER:


[2012-13] Page 7

a) Object of the Issue:

The purpose of the issue to allot shares is to infuse funds into the Company to start new projects in order to revive the operations of the Company and to carry on the business of the Company in a more revenue generating model. Additional funds through the issue shall augment the revenue sources of the Company thereby increasing the net worth of the Company.

b) the proposal of the promoters, directors or key management personnel of the issuer

subscribe to the offer:

None of the promoter or director or key managerial personnel of the Company has expressed their intention to subscribe to the offer.

c) Shareholding pattern before and after the offer of shares:

Shareholding pattern before and immediately after issue of 5000000 equity shares pursuant to the offer:

Category

Before Preferential Issue After Preferential Issue

No. of Shares

held

Percentage

of Share

holding

No. of Shares

held

Percentage of

Share holding

(A) Promoters Holding

1 Promoters

1.1 Indian Promoters 45,000.00 1.00 45,000.00 0.47

1.2 Foreign Promoters - - - -

2 Persons acting in concert - - - -

Sub-Total (A)(1) + (A)(2) 45,000.00 1.00 45,000.00 0.47

(B) Non-Promoters Holding

3 Institutional Investors

3.1 Mutual Funds and UTI - - - -

3.2

Banks, financial Institutions,Insurance Companies (central/state Govt.Institutions / Non-government Institutions)

- - - -

3.3 FIIs - - - -

Sub-Total (B)(3) - - - -

4 Non Institutional Investors

4.1 Body Corporate 9,91,060.00 21.95 10,91,060.00 11.47

4.2 Indian Public 25,04,853.00 55.48 72,04,853.00 75.72

4.3 Clearing Member - -

-

4.4 Hindu Undivided Family - - 2,00,000.00 2.10

4.5 NRI - - - -

4.6 Independent Directors 9,74,152.00 21.58 9,74,152.00 10.24

4.7 Any other - - - -

Sub-Total (B)(4) 44,70,065.00 99.00 94,70,065.00 99.53

Grand Total (A)+(B) 45,15,065.00 100.00 95,15,065.00 100.00


[2012-13] Page 8

d) Proposed time within which the allotment shall be completed:

The allotment of equity shares will be completed within a period of fifteen days from the date of passing of the resolution by the Shareholders at the Annual General Meeting, provided that when the allotment on preferientia1 basis is pending on account of any approval of such allotment by any regulatory authority, stock exchange or the Central Government, the allotment shall be completed within 15 days from the date of receipt of last such approval.

e) Identity of the proposed allottees and percentage of post preferential issue:

The details of the proposed allottees for the preferential issue are as follows:

Non - Promoter Holding:


[2012-13] Page 9

f) Lock in period:

The shares to be issued and allotted on preferential basis shall be subject to a lock in period as per SEBI (ICDR) Regulations asamended from time to time.

Sl.

No. Name of the Allottee

Promoter/Non-

Promoter

Permanent

Account Number

(PAN)

No.of

Securities

allotted

% of

Share

holding

post

allotment

Status of the Allottee

(QIB/MF/FI/FII/Banks/

Trust

1 SANJAY SINGHAL Non-Promoter ANRPS7985C 350000 3.68 Individual

2 ARTI SINGHAL Non-Promoter AEFPS6299L 350000 3.68 Individual

3 ANIKET SINGHAL Non-Promoter CZCPS6126E 350000 3.68 Individual

4 NITIN KUMAR DIDWANIA Non-Promoter AACPD7055J 400000 4.20 Individual

5 ASHOK B JIWRAJKA Non-Promoter AACPJ3610K 150000 1.58 Individual

6 DILIP B JIWRAJKA Non-Promoter AAGPJ8756J 150000 1.58 Individual

7 SURENDRA B JIWRAJKA Non-Promoter AACPJ4316L 150000 1.58 Individual

8 ALOK A JIWRAJKA Non-Promoter ADBPJ3866B 150000 1.58 Individual

9 NIRAJ D JIWARAJKA Non-Promoter AILPJ1766H 150000 1.58 Individual

10 VARUN S. JIWRAJKA Non-Promoter AIIPJ4395B 150000 1.58 Individual

11 G.S. ANITHKUMAR Non-Promoter ADPPK9874N 150000 1.58 Individual

12 SHEELA PRASANNAKUMAR Non-Promoter ACXPP4532B 150000 1.58 Individual

13 VEENA LINGARAJU Non-Promoter ABWPL7781N 150000 1.58 Individual

14 G.A. SAVITHA Non-Promoter CAIPS3473F 150000 1.58 Individual

15 SAVITA GOEL Non-Promoter AEIPG7233F 300000 3.15 Individual

16 NITI NITINKUMAR DIDWANIA

Non-Promoter AAAPA8012E 220000 2.31 Individual

17 HARISH KUMAR Non-Promoter ABBPK9377N 200000 2.10 Individual

18 PRITI DEVI Non-Promoter ACPPD8221M 200000 2.10 Individual

19 PEEYUSH MAKHIJA Non-Promoter BGGPM9415G 200000 2.10 Individual

20 RISHABH NAVALKISHOR SONI

Non-Promoter BXXPS3112A 150000 1.58 Individual

21 NANDINI TONDON Non-Promoter AJXPT1808P 100000 1.05 Individual

22 MahendraBhanjiPasad Non-Promoter AACPP6436B 50000 0.53 Individual

23 BhavyaAtulDedhia Non-Promoter AAGPD0842H 50000 0.53 Individual

24 RAMJI VALJI VAID Non-Promoter ADSPV0633K 50000 0.53 Individual

25 PRAGYA SETHIA Non-Promoter AGKPK5737C 50000 0.53 Individual

26 URMILA JAIN Non-Promoter AGZPS1328L 50000 0.53 Individual

27 NIKHIL TONDAN Non-Promoter ABBPT2529B 50000 0.53 Individual

28 KARUNA KHANNA Non-Promoter AKYPK3316M 80000 0.84 Individual

29 HARISH KUMAR HUF Non-Promoter AABHH1324M 200000 2.10 HUF

30 HAZEL MERCANTILE LIMITED

Non-Promoter AAACH2671K 100000 1.05 Body Corporate

Total 50,00,000


[2012-13] Page 10

g) Pricing Certificate of the Auditors:

M/s. C.Ramasamy&B.Srinivasan., Chartered Accountants, Kolkata,, Statutory Auditors of the company, have issued a certificate recommending a price of Rs.15.00 (Rupees Eleven only) calculated as per CHAPTER VII of 'SECURITIES AND EXCHANGE BOARD OF INDIA (ISSUE OF CAPITAL AND DISCLOSURE REQUIREMENTS) REGULATIONS, 2009. The said certificate shall be placed before the shareholders at the Extra Ordinary General meeting and is available for inspection of Members at the registered office of the Company during 10 A.M. to 5.00P.M.on any working day upto the date of the Extra Ordinary General meeting.

h) Change in Management:

There will be no change in the Management control of the Company.

i) Legal Requirement:

As per provisions of Sections 81 (1A) of the Companies Act, 1956, consent of the shareholders by way of Special resolution is required for issue of Equity Shares on preferential basis. Hence, the Board recommends the said resolution for the approval of shareholders in the ensuing Extra Ordinary general Meeting.

j) Disclosure of Interest:

None of the Directors or Key Managerial Personnel of the Company are concerned or interested in the above resolutions except to the extent of the shares held by them.

k) Others:

The certificate of the Statutory Auditors of the Company to the effect that the present preferential offer is being made in accordance with the requirements contained in Chapter VII of the SEBI (ICDR) Regulations shall be placed before the Shareholders at the meeting.

ITEM 8: CHANGE OF NAME: The Company is carrying on more agro based activities and its income is more from sale of such products and hence it would be better to reflect the activity in the Company’s name to target the customers better. Further, the change of name is proposed by the Board of Directors and the said change can only be approved by the members of the Company and therefore the same is placed before the members for their approval through special resolution. The altered Memorandum and Articles of Association of the Company is kept in the registered office of the company for inspection of the members during business hours, till the date of the AGM. None of the Directors or key managerial personnel of the company or their relatives are interested in this resolution.


[2012-13] Page 11

ITEM 9: APPOINTMENT OF SHYAM SUNDAR AS DIRECTOR:

Mr. Shyamsundar was appointed as an additional Director of the company on 13 November, 2013 and his work has been quite impressive. Being an additional director his tenure ends at the ensuing AGM. The Company has received a notice from a member proposing Mr. ShyamSundar as Director of the Company. Directors can be appointed by members by passing a ordinary resolution and the Board proposes the resolution before the members for their approval. None of the Directors or key managerial personnel of the company or their relatives are interested in this resolution.

Place: Chennai


Sd/- ANANDAN RANGANATHAN

Date : 14/11/2013 Director


[2012-13] Page 12

DIRECTOR’S REPORT Your Directors present their report for the year ended 31st March, 2013 together with the Balance Sheet as at 31st March 2013 and The Statement of Profit and Loss for the year ended on that date.

FINANCIAL HIGHLIGHT Particulars Audited Financial

Statement for the year

ended March 31st 2013

Audited Financial

Statement for the year

ended March 31st 2012

Total Income 2,244,929.26 5,549,346.00

Total Expenditure 2,142,183.34 4,996,511.50

Profit/(Loss) Before Tax 102,745.92 552,834.50

Less: Provision for Taxation for earlier year

- 115,951.00

Less: Provision for fringe benefit tax - -

Profit/(Loss) after tax 102,745.92 1,250,073.66

Profit/(Loss) brought forward (60,578,458.14) (61,828,531.80)

Balance carried to Balance Sheet (60,475,712.22) (60,578,458.14)

Earnings per share 0.02 0.28

DIVIDEND:

No Dividend has been recommended by the Directors as the Company wants to set off the losses incurred in the previous years. FIXED DEPOSITS: During the year under review, the Company has not accepted any fixed deposits and there are no fixed deposits, which are pending repayment. PERFORMANCE & PROSPECTS:

The Indian retail industry has experienced significant growth overthe last decade with a noticeable shift towards organised retailingformats. The industry is moving towards a modern concept ofretailing. India’s retail market is expected to grow at 7 per cent over the next 10 years, reaching a size of US$ 850 billion by 2020.Traditional retail is expected to grow at 5 per cent and reach asize of US$ 650 billion (about 76 per cent), while organised retailis expected to grow at 25 per cent and reach a size of US$200 billion by 2020. Your Company continues to endeavour toreinstate its growth pattern in the retail industry with a chain of Departmental Stores. Your directors are making efforts to come out of the competition and expect good results during current financial year. DIRECTORS:

Mr. Raghavan, who was appointed as Additional Director on Board of the Company was not regularised by the Shareholders at the Annual General Meeting held on 29th September, 2012. Mr. HemaramMahaveer, resigned from the Board of the Company on 27th March, 2013. Mr. DinanathShyamsundar was appointed as Additional Director on 14th November, 2013. The Board of directors recommends the appointment of Mr. DinanathShyamsundar as the Independent Director Mr. V. P. Chokhani, who retires by rotation, offers himself for re-appointment. AUDITORS:

Your Directors have appointed M/s. N.Kanodia& Co., Chartered Accountants, as auditors of the Company in place of auditors M/s. C.Ramasamy&B.Srinivasan, who have resigned. M/s. N.Kanodia& Co., Chartered Accountants have given their willingness to be appointed as the Auditors of the Company from the conclusion of the ensuing Annual General Meeting till the conclusion of the next Annual General Meeting.


[2012-13] Page 13

PARTICULARS OF ENERGY CONSUMPTION, FOREIGN EXCHANGE EARNINGS

AND OUTGO AND TECHNOLOGY ABSORPTION, ADAPTATION AND

INNOVATION, RESEARCH AND DEVELOPMENT:

A) ENERGY CONSERVATION:

Conservation of energy continues to receive increased emphasis and steps are being taken to reduce the consumption of energy at all levels. The Company has taken steps to conserve energy in its office use, consequent to which energy consumption had been minimized. No additional Proposals/ Investments were made to conserve energy. Since the Company has not carried on industrial activities, disclosure regarding impact of measures on cost of production of goods, total energy consumption, etc, are not applicable. B) FOREIGN EXCHANGE EARNINGS AND OUTGO:

i. Activities relating to Exports, Initiatives taken to increase Exports, Developments of

new Export Market for products and services and Export Plans;

The Company has not undertaken any export activities.

ii. Total Foreign Exchange used and earned;

PARTUCULARS 2013 (in INR) 2012 (in INR)

Earnings NIL NIL

Outgo NIL NIL

C) Technology Absorption, Adaptation and Innovation, Research and Development:

The Company has not adopted / intend to adopt any technology for its business and hence no reporting is required to be furnished under this heading.

PERSONNEL:

There are no employees who are paid remuneration in excess under Section 217(2A) of the Companies Act, 1956 read with Companies (Particulars of Employees) Rules, 1975 as amended from time to time.

CORPORATE GOVERNANCE:

The Company has complied with the requirements of the Code of Corporate Governance as

stipulated in clause 49 of the listing agreement with the stock exchanges. A Report on Corporate

Governance along with Certification by the Chairman is attached in Annexure A.

A Certificate from the Auditors of the Company regarding compliance of the conditions of Corporate

Governance as stipulated by clause 49 of the listing agreement is attached in Annexure – B.


[2012-13] Page 14

DIRECTORS' RESPONSIBILITY STATEMENT:

Pursuant to the provisions under Section 217 (2AA) of the Companies Act, 1956, your

Directors confirm that:

1. In the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanations relating to material departures; if any;

2. 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 31st March, 2013 and of the profit of the Company for the said financial year;

3. The Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

4. The Directors have prepared the Annual Accounts for the financial year ended on 31st March, 2013 on a going concern basis.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT:

The management discussion and analysis of the financial conditions including the result of the operations of the company for the year under review as required under clause 49 of the Listing Agreement with the Stock Exchange is given as a separate statement in the Annual Report. Refer Annexure – C.

LISTING:

The listing fees of Madras Stock Exchange Limited, only in which the shares of the Company stand listed, have been paid. REPLY TO QUALIFICATION MADE BY AUDITORS IN AUDITORS REPORT:

1. The Company has got the Internal Management team which is capable of monitoring the

system and hence a Separate Internal Auditor is not required to be appointed.

RELATED PARTY TRANSACTION:

The Company has not taken any loans except Inter-Corporate Loan and Loan from Directors that are exempted under Section 58A of the Companies Act, 1956. COMPLIANCE CERTIFICATE:

In Accordance with Section 383A of the Companies Act, 1956 and Companies (Certificate)Rules 2001, the Company has obtained a Certificate from a Company Secretary in whole time practice, confirming that the company has complied with all the provisions of Companies Act, 1956.


[2012-13] Page 15

ACKNOWLEDGEMENT:

Your Directors wish to place on record their appreciation for the co-operation received from the

Government of Tamil Nadu and the Bankers and look forward to such co-operation in the future as

well. Your Directors would like to express their grateful appreciation to all the employees at all

levels for their hard work, solidarity, co-operation and support during the financial year. Your

Directors also wish to place on record their deep appreciation to customers, shareholders, vendors,

suppliers and other stakeholders for their continued support.

Place: Chennai


Sd/- V. P. CHOKHANI

Sd/- ANANDAN ANGANATHAN

Date: 14/11/2013 Director Director


[2012-13] Page 16

Annexure A

REPORT ON CORPORATE GOVERNANCE

COMPANY’S PHILOSOPHY ON CODE OF GOVERNANCE:

Your Company believes that good corporate governance contemplates that corporate actions balance the interests of all stakeholders and satisfy the tests of accountability and transparency. The Company adopts a model to adhere to all the rules and regulations of the statutory authorities. Duties and statutory obligations are discharged in a fair and transparent manner with the object of maximizing the value of the shareholders and stakeholders. 1. BOARD OF DIRECTORS:

a) COMPOSITION AND CATEGORY OF BOARD OF DIRECTORS:

The Company has in all 4 Directors with considerable professional experience in divergent areas connected with corporate functioning.

The Board of Directors of the Company comprises of Non-Executive and Independent Directors. In all there are four Directors, One Non-Executive and Three Independent Director.

Name of the Director Designation Category

Mr. V.P. Chokhani Chairman NON-Executive Director

Mr. AnandanRanganathan Director Independent Director

Mr. Ramesh Govindarajan* Director Independent Director

Mr. DinanathShyamsundar** Director Independent Director

*Appointed as Additional Director w.e.f. 27.03.2013

** Appointed as Additional Director w.e.f. 14.11.2013

None of the Directors on the Board is a Member of more than 10 Committees or Chairman of more than 5 Committees across all the companies in which he is a Director.

During the financial year under review, five Board Meetings were held i.e. on 15th May 2012, 14th August 2012, 6th September, 2012, 15th November 2012 and 14th February 2013 and the gap between two meetings did not exceed four months. The composition of the Board of Directors and their attendance at the Board Meetings during the financial year and at the last Annual General Meeting and also the number of Directorships held by Directors is mentioned below:


[2012-13] Page 17

Name of Director

Category of Director

Attendance Particulars

No. of Director-ships in other bodies

corporate

No. of Chairmanship/ Membership of Board Committees in other

Companies

Board Meetings

Last AGM

Chairman Member

Mr. V.P. Chokhani P/NED 5 Yes 3 - -

Mr. AnandanRanganathan I/NED 5 YES 1 - -

Mr. Ramesh Govindarajan* I/NED 0 NO - - -

Mr. DinanathShyamsundar** I/NED 0 NO - - -


** Appointed as Additional Director w.e.f. 14.11.2013

P Promoter MD Managing Director

ED Executive Director NED Non-Executive Director

I Independent - -

The Directorships held by the Directors as mentioned above do not include Alternate Directorships and Directorships held in Foreign Companies, Companies registered under Section 25 of the Companies Act, 1956 and Private Limited Companies. In accordance with Clause 49 of the Listing Agreement, Memberships / Chairmanships of only the Audit Committees and Shareholders’ / Investor Grievance Committees in all Public Limited Companies have been considered. b) PROCEDURE OF THE BOARD:

The Agenda for the Board and Committee Meetings is circulated to all the Directors in advance. The Board is briefed about the affairs, performance and other things as necessary. A tentative annual calendar for the Meetings of the Committees / Board is circulated in order to assist the Directors for planning their schedules to participate in the meetings. c) NON-EXECUTIVE DIRECTORS’ REMUNERATION:

The Company do not pay any fee/remuneration to the non-executive Directors. 2. AUDIT COMMITTEE:

The Audit Committee of the Company is constituted in line with the provisions of Clause 49 of the Listing Agreement with the Stock Exchange read with Section 292A of the Companies Act, 1956. The purpose of the Audit Committee is to assist the Board of Directors (“the Board”) in reviewing the financial information which will be provided to the shareholders and others, reviewing the systems of internal controls established in the Company, appointing, retaining and reviewing the performance of independent accountants/internal auditors and overseeing the Company’s accounting and financial reporting processes and the audit of the Company’s financial statements.


[2012-13] Page 18

a) TERMS OF REFERENCE:

• Overview of the Company’s financial reporting process and the disclosure of its financial information to ensure that the financial statements reflect a true and fair position and that sufficient and credible information are disclosed.

• Recommending to the Board, the appointment, re-appointment and, if required, the replacement of the statutory auditor, fixing of audit fees and approving payments for any other services.

• Discussion with the statutory auditors before the audit commences, of the nature and scope of audit as well as post-audit discussion to ascertain any area of concern.

• Reviewing the financial statements and draft audit report, including quarterly/half yearly financial information.

• Reviewing with the management the annual financial statements before submission to the Board, focusing primarily on :

i. any changes in accounting policies and practices; ii. major accounting entries based on exercise of judgment by management; iii. qualifications in draft audit report; iv. significant adjustments arising out of audit; v. the going concern assumption; vi. compliance with accounting standards; vii. compliance with stock exchange and legal requirements concerning financial

statements; viii. any related party transactions as per Accounting Standard 18.

• Reviewing the Company’s financial policies.

• Reviewing with management the quarterly, half-yearly, nine months and annual financial statements, standalone as well as consolidated before submission to the Board for approval.

• Reviewing with the management and the Statutory Auditors, anticipated changes in the Accounting Standards.

• Reviewing the statements of significant related party transactions, the financial statements and/or investments made by the unlisted Subsidiary Companies.

• Reviewing with the management, external and internal auditors, the adequacy of internal control systems.

• Reviewing the adequacy of internal audit function, including structure of the internal audit department, approval of the audit plan and its execution, staffing and seniority of the official heading the department, reporting structure, coverage and frequency of internal audit.

• Discussion with internal auditors of any significant findings and follow-up thereon.

• Reviewing the findings of any internal investigations by the internal auditors into matters where there is suspected fraud or irregularity or a failure of internal control systems of a material nature and reporting the matter to the Board.

• Looking into the reasons for substantial defaults in payments to the depositors, debenture holders, shareholders (in case of non-payment of declared dividends) and creditors.


[2012-13] Page 19

b) COMPOSITION:

The Audit Committee at present comprises of three members as follows;

Name of the Director Status in the Committee

Category

Mr. AnandanRanganathan Chairman Independent Director

Mr. V.P. Chokhani Member Non-Executive Director

Mr. DinanathShyamsundar* Member Independent Director

* Appointed as Additional Director w.e.f. 14.11.2013

All the members have accounting or related financial management expertise. During the financial year review, the Committee met five times i.e. on 15th May 2012, 14th August 2012, 6th September, 2012, 15th November 2012 and 14th February 2013 and the attendance of the members at the Audit Committee meetings was as follows:

Name of the Member Attendance Particular

Meeting Held Meeting Attended

Mr. AnandanRanganathan 5 5

Mr. V.P. Chokhani 5 5

Mr. DinanathShyamsundar* 5 0

* Appointed as Additional Director w.e.f. 14.11.2013

3. SHAREHOLDERS/INVESTOR GRIEVANCE AND SHARE TRANSFER COMMITTEE:

a) Composition:

The Shareholders/Investor Grievance and Share Transfer Committee comprises of;

Name of the Director Status in the Committee

Category

Mr. AnandanRanganathan Chairman Independent Director

Mr. V.P. Chokhani Member Non-Executive Director

Mr. Ramesh Govindarajan* Member Independent Director



[2012-13] Page 20

b) The terms of reference of this Committee are as under:

The Shareholders/Investor Grievance and share transfer committee specifically looks into redressing of shareholder’s and investor’s complaints such as transfer of shares, non-recipt of shares, non-receipt of declared dividend, non-receipt of annual report and to ensure expeditious share transfers. c) Meeting and Attendance of the committee:

The Committee overseas the performance of share transfers and recommends measures to improve the shareholders/investors service. The said Committee met 10 times during the year 2012-2013.

d) Shareholders queries received and replied in 2012-2013:

During the Financial year 2012-2013, no complaints were received from Shareholders. There are no complaints pending as on date of this report. There were no share transfer pending registrations as at 31st March, 2013.

In case of any investor complaint shareholders are requested to address the same to company.

4. ANNUAL GENERAL MEETINGS

Year Venue Date Time Number of Special Resolutions passed

2011-2012 No. 21, Spur Tank Road, Chetpet, Chennai – 600 031

29.09.2012 10.00 A.M NIL

2010-2011 No. 21, Spur Tank Road, Chetpet, Chennai – 600 031

30.09.2011 10.00 A.M NIL

2009-2010 16, White Road, Vth Floor, Royapettah, Chennai – 600 014

30.09.2010 10.00 A.M NIL

During the year under review, requirement for passing resolutions under postal ballot did not arise. No Extra-Ordinary General Meeting and Court convened meeting of the members were held during the year. 5. DISCLOSURES

a) Related Party Transactions; The Company has not entered into any transactions of a material

nature with the Promoters, the Directors or the Management, their subsidiaries or relatives, etc., that may have potential conflict with the interest of the Company. The necessary disclosures regarding the transactions are given in the notes to the Accounts.

b) Disclosures on accounting treatment: No differential treatment from the Accounting Standards was followed in the preparation of the financial statements.

c) The Company does not have a Whistle Blower Policy and no employee has been denied access to approach the audit committee to report any serious concerns.

d) The Company has complied with all the mandatory requirement of Clause 49 of the listing agreement and the extend of compliance of the Non-Mandatory requirement is given in the end of this Report

e) No money has been raised through Public/Right/Preferential issue during the year.


[2012-13] Page 21

6. COMMUNICATION WITH SHAREHOLDERS AND GENERAL SHAREHOLDERS

INFORMATION:

There were no specific presentations made to Institutional investors or to analysts during the year.

i. Date and Time of Annual General Meeting: Monday, 23rd day of December, 2013 at 11.00

A.M.

ii. Venue: Registered office of the Company.

iii. TENTATIVE FINANCIAL CALENDAR

Financial Year 1st April, 2013 to 31st March, 2014

Result for the quarter ending 30th June, 2013 by 14th August, 2013

Result for the quarter ending 30th September, 2013 by 14th November, 2013

Result for the quarter ending 31st December, 2013 by 14th February, 2014

Result for the year ending 31st March, 2014 by 30th May, 2014

Annual General Meeting by September, 2014

iv. Book Closure Date: 18.12.2013 to 23.12.2013 (both days inclusive)

v. LISTING STATUS & STOCK CODE

The Equity Shares of the Company are listing only on the Madras Stock Exchange. The Company confirms that it has paid annual listing fees to the Madras Stock Exchange for the year 2013-14. vi. SHAREHOLDING PATTERN AS ON 31.03.2013:

Category No. of Shares % of the total shares

Promoters Group 45,000 1.00

Public - Bodies Corporate 9,91,060 21.95

Public – Individual 34,79,005 77.05

Total 45,15,065 100.00

vii. DISTRIBUTION OF SHAREHOLDING AS ON 31.03.2013:

No. of Shares No. of Shareholders % Shareholding in Rs. %

1 to 5,000 335 79.76 1334000 2.95

5,001 to 10,000 55 13.09 492000 1.09

10,001 – 20,000 3 0.71 47000 0.10

20,001 – 30,000 1 0.24 29000 0.06

30,001 – 40,000 1 0.24 33000 0.07

40,001 – 50,000 1 0.24 50000 0.11

50,001 – 1,00,000 1 0.24 78000 0.17

1,00,000 & above 23 5.48 43087650 95.43

Total 420 100.00 45150650 100.00


[2012-13] Page 22

viii. ADDRESS FOR CORRESPONDENCE:

Vitan Departmental Stores & Industries Limited

No. 21, Spur Tank Road, Chetpet, Chennai – 600 031

ix. E-mail ID of Investor Grievance Redressed Cell: [email protected]

Place: Chennai


Sd/- V. P. CHOKHANI




[2012-13] Page 23

CEO / CFO CERTIFICATION

To,

The Board of Directors,

Vitan Departmental Stores & Industries Limited

Chennai.

Reg: Certification by CEO on the financial statements for the year 2012-2013.

We, V. P. CHOKHANI and ANANDAN ANGANATHAN, Directors of Vitan Departmental Stores & Industries Limited on the basis of the review of the financial statements and the cash flow statement for the financial year ended March 31st, 2013 and to the best of our knowledge and belief, hereby certify that:-

i) These statements do not contain any materially untrue statement or omit any material

fact or contain statements that might be misleading;

ii) These statements together present a true and fair view of the company’s affairs and

are in compliance with the existing accounting standards, applicable laws and

regulations.

iii) There are, to the best of our knowledge and belief, no transactions entered into by the

company during the year ended March 31st, 2013 which are fraudulent, illegal or in

violation of the company’s code of conduct.

iv) We accept the responsibility for establishing and maintaining internal controls for

financial reporting and that we have evaluated the effectiveness of internal control

systems of the company pertaining to financial reporting and we have disclosed to the

auditors and the Audit Committee, deficiencies in the design or operation of such

internal controls, if any, of which we are aware and the steps we have taken or

proposed to be taken to rectify these deficiencies.

v) We further certify that:

a. There have been no significant changes in internal control over financial reporting

during the year;

b. There have been significant changes in accounting policies during the year and

that the same have been disclosed in the notes to the financial statements; and

c. There have been no instances of significant fraud of which we have become aware

and the involvement therein, if any, of the management or an employee having a

significant role in the company’s internal control system over financial reporting.

Place: Chennai


Sd/-

V. P. CHOKHANI

Sd/-

ANANDAN ANGANATHAN



[2012-13] Page 24

Annexure – B

AUDITOR’S CERTIFICATE ON COMPLIANCE WITH THE CONDITIONS OF

CORPORATE GOVERNANCE UNDER CLAUSE 49 OF THE LISTING AGREEMENTS

To the Members of M/s. VITAN DEPARTMENTAL STORES & INDUSTRIES LIMITED,

I have examined the compliance of conditions of Corporate Governance by VITAN DEPARTMENTAL STORES & INDUSTRIES LIMITED (“The Company’), for the year ended on 31st March 2013, as stipulated in Clause 49 of the Listing Agreement of the said Company with stock exchanges. The compliance of conditions of corporate governance is the responsibility of the management. Our examination was limited to a review of the procedures and implementation thereof, adopted by the Company for ensuring the compliance of the conditions of the Corporate Governance. It is neither an audit nor an expression of opinion on the financial statements of the Company. In our opinion and to the best of our information and according to the explanations given to us and the representations made by the Management, we certify that the Company has complied with the conditions of Corporate Governance as stipulated in the above mentioned Listing Agreement. W further state that such compliance is neither an assurance as to the future viability of the company nor the effectiveness with which the management has conducted the affairs of the Company. For C. Ramasamy& B. Srinivasan

CharteredAccountants

FRN. 0029575S

Place: Chennai

Date:

Sd/-

C. Ramasamy

Partner

Membership No. 23714


[2012-13] Page 25

Annexure - C

MANAGEMENT DISCUSSION AND ANALYSIS

GLOBAL ECONOMY:

Following two years of anaemic and uneven recovery from the global financialcrisis, the global economy is teetering on the brink of another major downturn.Output growth has already slowed considerably during 2011, especially in thedeveloped countries. The baseline forecastforesees continued anaemic growth during 2012 and 2013. The global GDP grew at 3% in the lastfiscal year and is expected to maintain similar growth till 2018. Post 2018, theGDP is expected to grow at 2.5% till 2025.

Particulars 2013(%) 2014-2018(%) 2019-2025(%)

Advanced economies 1.2 1.9 1.5

Emerging economies 4.9 4.3 3.2

World 3.0 3.2 2.5

The upward trend was partly due totemporary factors such as easing financial conditions and recovering confidence inresponse to the European Central Bank’s (ECB’s) longer-term refinancing operations(LTROs). Global trade rebounded inparallel with industrial production in thefirst quarter of 2012, which, in turn,benefited trade-oriented economies,notably Germany and particularly theAsian economy. (Source – IMF World Economic Outlook) GLOBAL RETAIL INDUSTRY OVERVIEW:

The global retail industry has beenevolving rapidly. From a $10.5 trillion market in 2010, the market is expectedto grow 5% annually and expected to exceed $13.2 trillion by 2015. Food andgroceries represent the leading retail segment globally. The US, the UK, France,Germany and other developed countriesin Europe still boast of some of thebiggest retail industries in the world.However, the retail industry in the developing countries, especially the BRICnations, continues to grow at a muchfaster rate and attract the largest global retailers. Lately, countries like Georgia, Azerbaijan, Mongolia and Oman are becoming attractive destinationsfor global retailers, especially forthe specialty and luxury players. INDIAN ECONOMY:

The Indian economy grew at a decelerated 5% in the financial year ended 31st March 2013.India is expected to record a 6.1% gross domestic product (GDP) growth in the current fiscal. The growth is expectedto increase further to 6.7% in 2014-15,according to the World Bank’s latestIndia Development Update. At the same time, the Prime Minister’s EconomicAdvisory Panel expects the economicgrowth rate to increase to 6.4% in2013-14 from 5% during 2012-13,on the back of an improvement in theperformance of the agriculture and themanufacturing sectors.The government’s estimate for the fiscalyear 2012-13 pegged output growth at1.8%, while the manufacturing sector was expected to show a growth of1.9%. The services sector, which makesup more than half of India’s GDP, isforecast to slow down to 6.6% from8.2% a year ago. INDIAN RETAIL INDUSTRY OVERVIEW:

Retail industry is one of the biggestindustries of the country and accounts for 14-15% of the country’s GDP. It canbe broadly divided into unorganised and organised sectors. The industryhas shown rapid growth over the past few years and there has been a strong shift towards organised


[2012-13] Page 26

retail. Indianretail was a $435 bn industry in 2010of which $414 bn (95% of the market)was unorganised retail and only $21 bn (5% of the market) belonged to organised retail, between 2010 and 2012, the industry expanded at 10.6% and is expected to continue to grow ataround 7% till 2020. It is expected that the retail industry will reach a size ofUS$ 850bn by 2015. Traditional retail is expected to grow at 5% and reach a size of US$ 650 bn (76%), whileorganised retail is expected to grow at25% and will reach a size of $200 bndollar by 2015. GROWTH DRIVERS FOR THE INDIAN RETAIL INDUSTRY:

Introduction of FDI in retail -Foreign Direct Investment in retail was introduced by the Governmentof India in December 2012 which will allow international retailers to set-upmulti-brand stores in India. With an international retailer required to invest a minimum of $100 mn, this will result ina significant amount of influx of funds. Rising urbanisation Thougha significant Indian population still resides in the villages, there has been a rise in the migrationtowards cities and towns of India. This resettlement can be attributed to growing aspirations, higher standardsof living, rising number of youthsattending colleges among other reasons. With 50% of the Indian population below the age of 25, this trend of urbanisation will growstronger. Growing consumer class and rising per capita expendituresThe Indian consumer class has beengrowing at a ferocious pace. Accordingto the CSO estimate, the gross national disposable income (per capita) has been increasing at a CAGR of 15% and stood at Rs. 75,400 in 2012 compared toRs. 57,000 in 2010. Correspondingly, the per capita consumption both in the rural and theurban areas increased. According to a report by Crisil, the per capita monthlyconsumption in rural India grew by 19% during the 2009-10 to 2011-12 period, outpacing growth in spending by urban citizens. Rural per capita spending amounted to Rs. 1,281.45 a month, compared to Rs. 2,401.68 in urban areas, during the 2011-12 period. The latest value for household finalconsumption expenditure per capita (constant 2000 US$) in India wasRs. 523.74 as of 2011. Over the past decade, the value for this indicator has fluctuated between Rs. 523.74 in 2011 and Rs. 304.50 in 2001. Growing spread of plastic money Since the first credit card service were started in India in 2001 by CitiBank,the number of credit/debit cardholdershave increased exponentially. With such increase in plastic money and corresponding increase in itsacceptance, the number of transactionsthrough such media has been on therise. According to a report by CARE,64.3% of all transactions made at retailoutlets were done using credit/debit cards.Owning a credit card increases the disposable income thereby increasing expenditures. Favourable demographics According to the most recent population census in 2011, the population of India belonging to the age group of 15-60 years increasedto 64.3% compared to the 55.4% in1991. The median age of the 1.2 bnstrong Indian populations is 25.1 yearswhich clearly underlines the earning andspending potential of the country.Being an important industry, retailwill tap a considerable share of thespending. Place: Chennai


Sd/- V. P. CHOKHANI




[2012-13] Page 27

INDEPENDENT AUDITOR’S REPORT

To, The Members of, M/s.VITAN DEPARTMENTAL STORES AND INDUSTRIES LIMITED Report on the Financial Statements

We have audited the accompanying financial statements of Vitan Departmental Stores and Industries Limited (“the Company”), which comprise the Balance Sheet as at 31st March, 2013, the Statement of Profit and Loss and the Cash Flow Statement for the year then ended, and a summary of the significant accounting policies and other explanatory information. Management’s Responsibility for the Financial Statements

The Company’s Management is responsible for the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the Accounting Standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956 (“the Act”). This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error. Auditor’s Responsibility

Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with the Standards on Auditing issued by the Institute of Chartered Accountants of India. Those Standards require that we comply with the ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the financial statements. The procedures selected depend on the auditor’s judgement, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers the internal control relevant to the Company’s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by the Management, as well as evaluating the overall presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion. Opinion

In our opinion and to the best of our information and according to the explanations given to us, the financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:


[2012-13] Page 28

(a) in the case of the Balance Sheet, of the state of affairs of the Company as at 31st March, 2013;

(b) in the case of the Statement of Profit and Loss, of the profit for the year ended on that date,

and

(c) in the case of the Cash Flow Statement, of the cash flows for the year ended on that date. Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor’s Report) Order, 2003 (“the Order”) issued by the Central Government of India in terms of sub-section (4A) of section 227 of the Act, we give in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the order.

2. As required by section 227 (3) of the Act, we report that:

(a) We have obtained all the information and explanations which to the best of our

knowledge and belief were necessary for the purposes of our audit.

(b) In our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books.

(c) The Balance Sheet, Statement of Profit and Loss, and the Cash Flow Statement dealt with by this Report are in agreement with the books of account.

(d) In our opinion, the Balance Sheet, Statement of Profit and Loss, and the Cash Flow Statement comply with the Accounting Standards referred to in sub-section (3C) of section 211 of the Act and

(e) On the basis of the written representations received from the directors as on 31st March,

2013 taken on record by the Board of Directors, none of the directors are disqualified as on 31st March, 2013 from being appointed as a director in terms of clause (g) of sub-section (1) of section 274 of the Act.

For C.Ramasamy & B.Srinivasan Chartered Accountants FRN: 002957 S

Place : Chennai C. Ramasamy Date : 30.05.2013 Partner M.No.023714


[2012-13] Page 29

ANNEXURE REFERRED TO IN PARAGRAPH (3) OF THE AUDITORS REPORT TO

THE MEMBERS OF VITAN DEPARTMENTAL STORES AND INDUSTRIES

LIMITED, ON THE ACCOUNTS FOR THE YEAR ENDED 31st MARCH 2013:

In the terms of the information and explanations given to us and the books and records examined by us in the normal course of audit and to the best of our knowledge and belief, we state that:

1) The company does not have fixed assets.

2) The Company does not have inventory. 3) a) The company has not granted any loans secured or unsecured to companies, firms or other

parties listed in the register maintained under Section 301 of the Companies Act 1956, and hence clauses(b), (c) and (d) are not applicable.

e) The company has taken unsecured loans from companies, firms or other parties listed in the register maintained under Section 301 of the Companies Act 1956, the company has borrowed from two parties and the total amount outstanding is Rs.33,60,630.17 f) The rate of interest and other terms and condition of the loans taken by the company are prima facie are not prejudicial to the company. g) There are no stipulations as to repayment of prinicipal and interest.

4) 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, for the purchase of inventory and fixed assets and for the sale of goods and services. Accordingly the issue of continuing failure to correct major weakness in internal control system does not arise.

5) a) In our opinion and according to information and explanation given to us, there are no

contracts or arrangements that need to be entered into the register maintained under section 301 of the Companies Act, 1956.

b) In our opinion and according to information and explanation given to us, as there are no contracts or arrangements that need to be entered under section 301 of companies Act 1956, paragraph (v) (b) of the order is not applicable.

6) The company has not accepted any deposits from the public.

7) In our opinion, the company does not have an internal audit system commensurate with the

size and nature of its business.

8) The Central Government has not prescribed maintenance of cost records under clause (d) under sub-section (1) of Section 209 of the Companies Act 1956 for the products of the Company.


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9) a) The company is generally regular in depositing undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, Income Tax, Sales Tax, Wealth Tax, Service Tax, Customs Duty, Excise Duty, Cess and other statutory dues applicable to it with appropriate authorities and there are no arrears of outstanding statutory dues as at the last day of the financial year concerned for a period of more than six months from the date they became payable.

b) According to the records of the Company there are no dues outstanding of Income Tax, Sales Tax, Wealth Tax, Service Tax, Customs Duty, Excise Duty, Cess on account of any dispute.

10) The company has accumulated losses exceeding fifty percent of its networth at the end of the

financial year and has not incurred cash loss during the financial year and in the immediately preceeding financial year.

11) Based on the information and explanations given by the management, we are of the opinion

that the Company has not defaulted in repayment of dues to banks and financial institutions. The company has no outstanding dues to debenture holders.

12) According to the information and explanations given to us, the company has not granted

loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

13) In our opinion, and according to the information and explanations given to us, the nature of

activities of the Company does not attract the provisions of any special statute applicable to Chit fund and Nidhi/mutual benefit fund/societies.

14) 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) of the Companies (Auditor’s Report) Order, 2003 are not applicable to the company.

15) The company has not given any corporate guarantee .

16) The company has not availed any term loans.

17) According to the information and explanations given to us and on an overall examination of

the Balance Sheet of the company, we report that funds raised on short term basis have not been used for long term investments.

18) The company has not made any preferential allotment of shares to parties or companies

covered in the register maintained under section 301 of the Companies Act 1956 during the year.

19) The company has not issued any debentures and as such the creation of security or charge

does not arise.


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20) The company has not raised any money through public issue during the year. 21) According to the information and explanations given to us by the management, we report that

no fraud on or by the Company has been noticed or reported during the year. For C.Ramasamy & B.Srinivasan

Chartered Accountants FRN: 002957S C.RAMASAMY Place : Chennai Partner Date : 30.05.2013 M.No:023714


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VITAN DEPARTMENTAL STORES & INDUSTRIES LTD

CASH FLOW STATEMENT FOR THE YEAR ENDED MARCH 31, 2013

(In Rupees)

PARTICULARS 31.03.2013 31.03.2012

CASH FLOW FROM OPERATING ACTIVITIES

Net Profit Before Tax & Extraordinary Items 102,745.92 1,366,024.66

Adjustments for:

Depreciation - -

Provision for Taxation

Provision written back - (42,045.00)

(Profit)/Loss on sale of Investment - (43,355.00)

(Profit)/Loss on sale of fixed assets - (238,991.16)

Operating Profit Before Working Capital Changes 102,745.92 1,041,633.50

Adjustments for:

(Increase)/Decrease in Trade & Other Receivables 3,131,199.79 (3,542,096.00)

Increase/(Decrease) in Trade & Other Payables (1,706,747.00) 2,695,621.00

Cash Generated from Operations 1,527,198.71 195,158.50

Direct Taxes Paid - (115,951.00)

Net Cash from Operating Activities(A) 1,527,198.71 79,207.50

CASH FLOW FROM INVESTING ACTIVITIES

Sale of investment 85,400.00

Sale of Fixed Assets 1,083,333.00

Net Cash Used in Investing Activities(B) - 1,168,733.00

CASH FLOW FROM FINANCING ACTIVITIES

Borrowing of Unsecured Loans - (1,330,825.00)

Net Cash from Financing Activities(C) - (1,330,825.00)

NET INCRESE IN CASH & CASH EQUIVALENTS 1,527,198.71 (82,884.50)

(A+B+C)

OPENING CASH AND CASH EQUIVALENTS 168,946.03 251,830.53

(Cash and Bank balances)

CLOSING CASH AND CASH EQUIVALENTS(D+E) 1,696,144.74 168,946.03

(Cash and Bank balances)

As per our report of even date

For C.Ramasamy & B.Srinivasan


FRN : 002957S

Sd

Directors (C.Ramasamy)

Place : Chennai Partner

Date : 30.05.2013 M.No.23714


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PROXY FORM VITAN DEPARTMENTAL STORES AND INDUSTRIES LIMITED

No. 21, Spur Tank Road, Chetpet, Chennai – 600 031.

Reg.FolioNO_____________________________No.of hares:_________________________

D.P.I.D*_________________________________Client ID*____________________________

I / we _____________________________________________________________of ________ being a share holder / shareholders of VITAN DEPARTMENTAL STORES AND INDUSTRIES LIMITED. Hereby appoint _____________or failing him/her ______________ as my/ our proxy to attend and vote for me / us and on my/ our behalf at the Annual General meeting of the Company to be held on 23RD December, 2013 at 11.00 A.M. and at any adjournment thereof.

Signed this _____________ day of _____________, 2013

Signature of the shareholder _______________ [Signature of Proxy]

Note: The Proxy form duly completed and signed must be deposited at the Registered office of the Company not less than 48 hours before the time for holding the Meeting

*Applicable for shares held in electronic form.

----------------------------------------------------------------------------------------------------------

VITAN DEPARTMENTAL STORES AND INDUSTRIES LIMITED No. 21, Spur Tank Road, Chetpet, Chennai – 600 031.

ATTENDANCE SLIP Annual General Meeting

Reg. Folio NO._________ No. of shares held________

Name of the Attending Member____________________________

D.P.I.D*______________Client I.D.*_____________________________________

I/We hereby record my/our presence at the Annual General Meeting of the Company being held on 23rd December 2013 at No. 21, Spur Tank Road, Chetpet, Chennai – 600 031. At 11.00 A.M Signature of the shareholder(s), / Proxy/ Representative__________________

Note:

1) Member / proxy holder wishing to attend the meeting must bring the attendance slip to the meeting and hand over the same duly signed at the Venue.

Affix Re. 1/- Revenue Stamp

BOOK POST

IF UNDELIVERED PLEASE RETURN TO

VITAN DEPARTMENTAL STORES AND INDUSTRIES LIMITED REG:- NO. 21, SPUR TANK ROAD, CHETPET, CHENNAI – 600 031.

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