Reliance Utilities & Power Ltd. Date: 2004.06.30. Directors report 14TH DIRECTORS' REPORT FOR THE YEAR ENDED 30TH JUNE 2004 The Directors have pleasure in presenting the 14th Annual Report and the audited accounts for period ended 30th June 2004. FINANCIAL RESULTS 2003-2004 2002-2003 (Rs.) (Rs.) Gross Profit before interest 365 94 64 867 397 69 56 554 and depreciation Less : Interest 109 77 88 018 187 76 23 765 Depreciation 80 17 75 356 95 73 29 378 Profit before Tax 175 99 01 493 114 20 03 411 Less : Provision for Taxation Current Tax 12 40 00 000 7 90 00 000 Deferred Tax Credit (4 60 49 920) - Profit for the year 168 19 51 413 106 30 03 411 Add: Short Provision of Income Tax for earlier Year - (1697) Provision written back - - Balance brought Forward from last year - 89 61 30 809 Amount Available for 168 19 51 413 195 91 32 523 Appropriations Appropriation Debenture Redemption Reserve (34 36 56 860) 116 96 73 004 Dividend on preference share including arrears - 45 30 40 000 Deferred tax liability for earlier years - 33 64 19 519 Balance carried to Balance Sheet 202 56 08 273 NIL DIVIDEND With a view to conserve resources, your Directors have not recommended any dividend on the equity shares for the year under review. DIRECTORS Shri V.K. Gandhi and Shri Sandeep Tandon, retire by rotation and being eligible, offer themselves for re-appointment at the ensuing Annual General Meeting. DIRECTORS' RESPONSIBILITY STATEMENT Pursuant to the requirement under section 217 (2AA) of the companies Act, 1956 with respect to Directors' Responsibility Statement, it is hereby confirmed that (1) in the preparation of the annual accounts, the applicable accounting standards have been followed; (ii) the Directors have selected such accounting policies and applied them consistently and made judgment and estimate that were reasonable and prudent so as to give a true and fair view of the state of the affairs of the Company as at 30th June, 2004 and of the profit of the Company for the year ended on that date; (iii) the directors have taken proper and sufficient care for the maintenance of the 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; (iv) the directors have prepared the annual accounts of the Company on a "going concern" basis. CONSTITUTION OF AUDIT COMMITTEE As required by the provisions of Section 292A of the Companies Act, 1956, the Board of Directors has constituted Audit Committee comprising of three Directors i.e., Shri K. Ramamurthy, Shri K.P. Nanavaty and Shri J.B. Dhokalia. FIXED DEPOSITS Since your Company has not accepted any deposits from the public, no information is required to be furnished in respect of outstanding deposits. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO The Information relating to technology absorption, foreign exchange earnings and outgo required to be disclosed under Rule 2 of the Companies (Disclosures of Particulars in the Report of Board of Directors) Rules, 1988, is given in Annexure I and forms part of this Report. PERSONNEL As required by the provisions of Section 217(2A) of the Companies Act, 1956, read with the Companies (Particulars of Employees) Rules, 1975, as amended, the names and other particulars of employees are set out in the Annexure II to the Directors' Report. AUDITORS M/s. Chaturvedi & Shah, Chartered Accountants, Statutory Auditors of the Company hold office until the conclusion of the forthcoming Annual General Meeting and are eligible for re-appointment. The Company has received letters from them to the effect that their appointments, if made, would be within the prescribed limits under Section 224(1-B) of the Companies Act, 1956 and also that they are not otherwise disqualified within the meaning of sub section (3) of section 226 of the Companies Act, 1956, for such appointment. The observations made in the Auditors' Report are self-explanatory and therefore do not call for any further comments. ACKNOWLEDGEMENT Your Directors wish to place on record their immense appreciation for the assistance and cooperation received from various Statutory Authorities, Government Authorities, Banks, customers, suppliers., shareholders and debenture holders. Your Directors also wish to place on record their deep sense of appreciation for the devoted services of the employees of the Company.