IIT Investrust Limited

REPORT BY BOARD OF DIRECTORS

TO THE MEMBERS

Your Directors present the Twenty Fifth Annual Report together with the Audited Accounts for the Financial Year ended 31st March, 2015.

EXTRACT OF THE ANNUAL RETURN

The extract of the Annual Return as provided u/s 92(3) of the Companies Act, 2013 read with Companies (Management & Administration) Rules, 2014, is given as Annexure A in the Annexure forming part of this Report.

NO. OF MEETINGS OF THE BOARD

The Board of Directors have met 5 (five) times during the Financial Year ended 31st March, 2015.

DIRECTORS' RESPONSIBILITY STATEMENT

In accordance with the provisions of the Section 134(3)(c) & 134(5) of the Companies Act, 2013, your Directors confirm that:

1. Applicable accounting standards have been followed in the preparation of the Annual Accounts for the year ended 31st March, 2015 with proper explanation relating to material departures.

2. Accounting policies have been selected and applied consistently and judgments and estimates have been made which are reasonable and prudent and have been applied so as to give a true and fair view of the state of affairs of the Company in respect of the financial year ended 31st March, 2015 and of the profit of the Company for that period.

3. Proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.

4. Annual Accounts for the year ended 31st March, 2015 have been prepared on the basis of going concern concept.

5. The Directors have laid down the internal financial controls to be followed by the Company detailing the policies and procedures and these internal financial controls are adequate and are being operated effectively.

6. Proper systems have been devised to ensure compliance with the provisions of all applicable laws and such systems are adequate and operating effectively.

DECLARATION BY INDEPENDENT DIRECTORS

Every Independent Director has, at the first meeting of the Board and also at the first meeting of the Board after his/her appointment, in the financial year 2014-2015, given a declaration as required u/s.149 of the Companies Act, 2013 that he/she meets the criteria of Independence.

POLICY ON DIRECTOR'S APPOINTMENT AND REMUNERATION ETC.

The Company's policy on Directors' appointment and remuneration including criteria for determining qualifications, positive attributes, independence of a director and other matters provided u/s.178(3) of the Companies Act, 2013 is given as Annexure B in the Annexure forming part of this Report.

DIRECTORS

In accordance with the provisions of the Companies Act, 2013 and the Articles of Association of the Company, Ms. Sweta Patodia retires by rotation at the ensuing Annual General Meeting and being eligible, offers herself for re-appointment.

AUDITORS

Messers Goenka Shaw & Co., Chartered Accountants, the Statutory Auditors of the Company retire at the forthcoming Annual General Meeting and are eligible for re-appointment.

AUDITORS' REPORT

The report by the Auditors is self explanatory and has no qualification, reservation, adverse remark or disclaimer; hence no explanation or comments by the Board were required.

SECRETARIAL AUDIT REPORT

The Secretarial Audit Report by the Company Secretary in Practice is self explanatory and is given as Annexure C in the Annexure forming part of this Report.

Further, this report has no qualification, reservation, adverse remark or disclaimer; hence no explanation or comments by the Board were required.

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS u/s 186 OF THE COMPANIES ACT, 2013

During the year from 01/04/2014 to 31/03/2015 : NIL

The position as on 31/03/2015 and as on 31/03/2014 : refer note nos. 12.0, 13.0 and 17.0

PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES REFERRED TO IN SECTION 188(1) OF THE COMPANIES ACT, 2013 AND/OR IN THE FORM AOC-2

During the year the Company had a transaction which is not a contract or arrangement. This transaction was at arm's length and in the ordinary course of business and is covered under 3rd proviso to sec 188(1) which reads as "nothing in this subsection shall apply to any transactions entered into by the company in its ordinary course of business other than transactions which are not on an arm's length basis", is given in Form AOC-2 as Annexure D in the Annexure forming part of this Report.

OPERATIONS & PROSPECTS

During the year there has been increase in tea production at Norben and slight increase in profit.

Employee cost has increased at a record rate as decided by Tripartite Agreement between Workers Association, State Government and Representatives of Industry, resulting in payment of arrear wages and further increased wages in the current year.

MATERIAL CHANGES, IF ANY

Material changes and commitments, affecting the financial position of the company, have not occurred between the end of the financial year of the company to which the financial statements relate and the date of the report

CONSERVATION OF ENERGY, ABSORPTION OF TECHNOLOGY, FOREIGN EXCHANGE EARNINGS AND OUTGO

The information pursuant to Section 134(3)(m) of the Companies Act, 2013 and Rule 8 of Companies (Accounts) Rules, 2014, is given as Annexure E in the Annexure forming part of this Report.

RISK MANAGEMENT POLICY

The Board of Directors of the Company has developed and implemented a risk management policy for the Company including identification therein of elements of risk, which in the opinion of the Board, may threaten the existence of the Company.

POLICY ON CORPORATE SOCIAL RESPONSIBILITY

The level of operations of the Company does not conform to the minimum threshold of Corporate Social Responsibility reporting.

FORMAL ANNUAL EVALUATION OF BOARD

Formal annual evaluation by the Board of its own performance and that of its committees and individual directors had been done during the year in the manner stated in the Criteria for Performance Evaluation of the Directors of the Company as framed by the Nomination and Remuneration Committee of the Company an given as Annexure F in the Annexure forming a part of this Report.

CHANGE IN THE NATURE OF BUSINESS

There has been no change in the nature of Business of the Company.

DETAILS OF DIRECTORS OR KEY MANAGERIAL PERSONNEL WHO WERE APPOINTED OR HAVE RESIGNED DURING THE YEAR

The details of Directors who were appointed or have resigned during the year are covered under the Report on Corporate Governance.

The details of Key Managerial Personnel who were appointed or have resigned during the year are as follows:

Managing Director : Re-appointment of Mr. M.K.Daga as Managing Director vide resolution No. 7 passed at the Annual General Meeting held on 30th July 2014.

Company Secretary : Re-appointment of Mr. Pawan Kothari as Company Secretary at Board of Directors meeting held on 26th May 2014.

Chief Financial Officer : No Change

NAMES OF COMPANIES WHICH HAVE BECOME OR CEASED TO BE ITS SUBSIDIARIES, JOINT VENTURES OR ASSOCIATE COMPANIES DURING THE YEAR

NIL

DETAILS RELATING TO DEPOSITS COVERED UNDER OR WHICH ARE NOT IN COMPLIANCE WITH THE REQUIREMENTS OF CHAPTER V OF THE ACT

NIL

DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS IMPACTING THE GOING CONCERN STATUS AND COMPANY'S OPERATIONS IN FUTURE

There are no significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and company's operations in future.

DETAILS IN RESPECT OF ADEQUACY OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THE FINANCIAL STATEMENTS

Being a listed entity, the financial statements are passing through the Audit Committee and the processes of Internal and External (Tax, Cost and Statutory) Audits, before being approved at the meeting of the Board of Directors of the Company. The financial statements are regularly updated on the Company's website and available to all stakeholders.

AUDIT COMMITTEE AS REQUIRED U/S.177(8) OF COMPANIES ACT, 2013

The composition of the Audit Committee is covered under the report on Corporate Governance and which is a part of this report.

Further, during the year there was no recommendation of the Audit Committee which had not been accepted by the Board.

VIGIL MECHANISM/WHISTLE BLOWER POLICY

In pursuance to the provisions of section 177(9) & (10) of the Companies Act, 2013, a Vigil Mechanism for Directors and employees of the Company, to report genuine concerns has been established. The Vigil Mechanism/Whistle Blower Policy has been uploaded on the Company's website at www.norbentea.com/pdf/vigil-blower.pdf

POLICY ON CORPORATE SOCIAL RESPONSIBILITY

The level of operations of the Company does not conform to the minimum threshold of Corporate Social Responsibility reporting. FORMAL ANNUAL EVALUATION OF BOARD

CHANGE IN THE NATURE OF BUSINESS

There has been no change in the nature of Business of the Company.

DETAILS OF DIRECTORS OR KEY MANAGERIAL PERSONNEL WHO WERE APPOINTED OR HAVE RESIGNED DURING THE YEAR

The details of Directors who were appointed or have resigned during the year are covered under the Report on Corporate Governance.

The details of Key Managerial Personnel who were appointed or have resigned during the year are as follows:

Managing Director : Re-appointment of Mr. M.K.Daga as Managing Director vide resolution No. 7 passed at the Annual General Meeting held on 30th July 2014.

Company Secretary : Re-appointment of Mr. Pawan Kothari as Company Secretary at Board of Directors meeting held on 26th May 2014.

Chief Financial Officer : No Change

NAMES OF COMPANIES WHICH HAVE BECOME OR CEASED TO BE ITS SUBSIDIARIES, JOINT VENTURES OR ASSOCIATE COMPANIES DURING THE YEAR

NIL

DETAILS RELATING TO DEPOSITS COVERED UNDER OR WHICH ARE NOT IN COMPLIANCE WITH THE REQUIREMENTS OF CHAPTER V OF THE ACT

NIL

DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS IMPACTING THE GOING CONCERN STATUS AND COMPANY'S OPERATIONS IN FUTURE

There are no significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and company's operations in future.

DETAILS IN RESPECT OF ADEQUACY OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THE FINANCIAL STATEMENTS

AUDIT COMMITTEE AS REQUIRED U/S.177(8) OF COMPANIES ACT, 2013

The composition of the Audit Committee is covered under the report on Corporate Governance and which is a part of this report.

Further, during the year there was no recommendation of the Audit Committee which had not been accepted by the Board.

VIGIL MECHANISM/WHISTLE BLOWER POLICY

PARTICULARS OF EMPLOYEES

As on March 31, 2015 the Company did not have any employee in the category specified in Rule 5(2) of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014.

MANAGEMENT DISCUSSION AND ANALYSIS

a) Industry Structure & Developments

India produced 1184.80 m.kgs. of Tea during the year 2014 as compared to 1200.41 m.kgs. in 2013. Indian Tea production was lower by 15.61 m.kgs. during the year 2014. The North Indian crop was lower by 15.00 m.kgs. while South Indian crop was estimated lower by 0.61 m.kgs. during the year 2014. The average price of Tea stood at Rs.115.35 per kg. in 2014 as against Rs.116.89 per kg. in 2013 representing a drop in Tea price by Rs.1.54 per kg. The main reason for the drop in the average price was the glut like situation in global market, depressing the auction price realization in almost all the auction centers.

Also, the basic wages of Tea Garden workers in West Bengal has been increased by 39.47% with retrospective effect from January 2014.

Tea is no longer under the exempted list of Agriculture Commodity so far as payment of Service tax is concerned. The resultant effect of this would be that Brokerage, Commission, Warehousing & Transportation would all be subject to service Tax @14% as soon as the President gives assent to the Budget.

b) Opportunities, Threats, Risks & Concerns

Because of the very small size of production the Company's teas are readily accepted in niche market for "NORBEN" created over the years.

All the plantations of Norben are of high yielding clones producing bright liquoring teas.

The age of the plantations is very young and provides a great advantage in terms of cost due to less disease and low maintenance cost due to vigorous health of the bush.

The Company has in place systems of Internal Control commensurate with the size of the Company and the nature of its business, which ensures that transactions are recorded, authorized and reported correctly apart from safeguarding its assets against loss from wastage, unauthorized use and removal.

The Internal Control System is supplemented by documented policies, guidelines and procedures. An extensive programme of review is carried out by the Company's Management cum Internal Audit team which submits detailed reports periodically to the Management.

Tea continues to enjoy the status of being the most popular beverage in the World.

The Tea Industry is largely dependent on the vagaries of nature. The Industry is highly labour intensive and is subject to stringent labour laws. Comparatively high labour costs, high social cost over most other tea producing countries, high infrastructure costs and the increasing energy and other input costs remain the major problems for the Indian Tea Industry. Shortage of labour during peak season is also a cause for concern.

These problems need to be addressed by improved productivity and energy conservation. The Tea Industry both in Assam and in West Bengal have discussed with the Trade Unions and implemented productivity linked wages for the tea workers with a view to regain the Industry's competitiveness in the global market.

The Special Purpose Tea Fund (SPTF) has been set up by Commerce Ministry to implement uprooting and replanting programme which would help improvement in the productivity and yield thereby reducing cost in the coming years.

The small tea growers and bought leaf factories form a considerable part of the Industry. A recent compilation of figures shows a total production of around 100 million kgs through these bought leaf factories in North India. There is a need to regulate these factories to maintain the quality. The Industry is also subject to taxation from the State Government as well as Central Government and while the level of direct taxes have come down over a period, some of the State levies like cess on green leaf and substantial increase in Land Revenue Charges put the industry at a very disadvantageous position.

c) The Company is a Single Business Segment Company

d) Outlook

An upsurge in demand from the domestic market should drive tea prices higher. Consumption of tea has increased compared to increase in production, which will improve realizations. However, India needs to take a number of initiatives to strengthen its position in the global market and address emerging markets by further improving the quality as well as packaging standards, thereby enhancing product quality.

e) Internal control system and their adequacy

The Company implemented internal control systems to ensure that all assets are safeguarded and protected against loss and that transactions are recorded and reported correctly. The internal control system is commensurate with the size and nature of the Company's business. The systems are regularly reviewed for effectiveness.

f) Discussion on financial performance with respect to operational performance

This has been covered in the Director's report specifically under the section on financial results and performance. The financial review for the year has also been separately covered in this Annual Report.

g) Material developments in human resources/industrial relations front, including number of people employed

The Company emphasizes training and development for optimum results. The Company strives to maintain healthy industrial relations across its various locations and employees. The number of persons employed by the Company as on March 31, 2015 was 111.

h) Cautionary Statement

Statements in the Management Discussions and Analysis Report in regard to projections, estimates and expectations have been made in good faith. Many unforeseen factors may come into play and affect the actual results which could be different from what the Directors envisage in terms of future performance and outlook. Market data and product information contained in this Report have been based on information gathered from various published and unpublished reports, and their accuracy, reliability and completeness cannot be assured.

AUDITORS' CERTIFICATE REGARDING COMPLIANCE OF CONDITIONS OF CORPORATE GOVERNANCE

Certificate regarding compliance of conditions of corporate governance is given as Annexure G in the Annexure forming part of this report.

STOCK EXCHANGE(S)

The Company has completed the paper publications and other formalities for delisting from the other Stock Exchanges but is yet to receive their certificates of delisting.

For revocation of suspension in trading of Equity Shares of the Company at Bombay Stock Exchange, the Exchange has demanded a huge amount as reinstatement fees which is apparently not justified in terms of the Listing Agreement. Therefore, the Company has taken legal opinion and has been advised to move the matter at Securities Appellate Tribunal, Bombay, pending correspondence with Bombay Stock Exchange to resolve the issue.

APPRECIATION

The Directors wish to place on record their appreciation for the support received from the Local Gram Panchayat, Government Departments, Banks, Stakeholders and all others.

By Order of the Board

For NORBEN TEA & EXPORTS LTD.

M.K.DAGA

(Chairman & Mg.Director)

Regd.Office: 15B, Hemanta Basu Sarani, 3rd Floor, Kolkata-700001.

Date : 14th May, 2015.