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CITIZEN INFOLINE LIMITED 19TH ANNUAL REPORT 2012-2013

19TH ANNUAL REPORT

2012-2013

CITIZENINFOLINE LIMITED411, Sakar-II, Ellisbridge, Ashram Road, Ahmedabad - 380 006

AUDITERSBAHETI BAHADADA & ASSOCIATES

201, SHAILY COMPLEX, BEHIND OLD GUJARAT HIGH COURT, OPP. LOHA BHAVAN, INCOME TAX, AHMEDABAD-380009.


COMPANY INFORMATION

BOARD OF DIRECTORS

Shri Omprakash L. Jain - Chairman Shri Pukhraj K. Ved - Director Shri Harsh O. Jain - Managing Director Shri Ravindra O. Jain - Director Shri Vikas H. Jirawala - Director

• REGISTERED OFFICE •411.SAKAR-II, ELLISBRIDGE,

ASHRAM ROAD, AHMEDABAD - 380 006

• BANKERS •HDFC Bank

• AUDITORS •M/S. BAHETI BHADADA & ASSOCIATES

Chartered Accountants201, Shaily Complex,

Nr. Old Guj. High Court,Ashram Road, Ahmedabad-380009

• Share Register and Transfer Agent •LINK INTIME INDIA PRIVATE LIMITED

303, Shopper Plaza-V, 3rd Floor, C. G. Road,Navrangpura, Ahmedabad - 380009.

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NOTICE

Notice is hereby given that the 19TH ANNUAL GENERAL MEETING of the members of CITIZEN INFOLINELIMITED will be held on 17 June 2013, Monday at 411, Sakar II, Ellis Bridge, Ashram Road, and Ahmedabad-380006 at 12.00 noon to transact the following business:

ORDINARY BUSINESS:

1. To receive, consider and adopt the audited Balance Sheet for the year ended 31st March, 2013, theProfit and Loss Account and Cash flow statement as at that date and the reports of the Directors and theAuditor thereon.

2. To appoint a director, Mr. Omprakash O. Jain who retires by rotation and being eligible, offers himselffor re-appointment.

3. To appoint a director, Mr. Ravindra O. Jain who retires by rotation and being eligible, offers himself forre-appointment.

4. To appoint statutory Auditors and to fix their remuneration.

SPECIAL BUSINESS:

5. To consider and pass following resolutions, with or without modifications, following resolutions as specialresolution.

To Consider and pass following resolutions either with or without modifications as special resolution.“RESOLVED THAT pursuant to the provisions of Section 293(1)(a) and other applicable provisions of theCompanies Act, 1956 (including any amendment thereto or re-enactment thereof),consent of the Company beand is hereby accorded to Board of Directors (hereinafter called “the Board” which term shall be deemed toinclude any Committee thereof, which the Board may have constituted or hereinafter constitute to exercise itspowers including the powers conferred by this resolution and with the power to delegate such authority to anyperson or persons) to sell the Office Building of the Company located at 414, Sakar – II, Ellishbridge, AshramRoad, Ahmedabad for Super built up area measuring to 1188 sq. ft for fair market price.

FURTHER RESOLVED THAT, buyers of the Office Building shall bear all the cost of the transfer, registrationand any expenses thereto.

RESOLVED FURTHER THAT the Board be and is hereby authorized to do all such acts, deeds and things andto sign all such documents and writings as may be necessary, expedient and incidental thereto to give effect tothis resolution and for matter connected therewith or incidental thereto.”

BY ORDER OF THE BOARD

(Omprakash Jain)Chairman

Place: AhmedabadDate : 08/05/2013


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NOTES:

1. A Member entitled to attend and to vote at the meeting is entitled to appoint a proxy to attend and tovote instead of himself/herself and such proxy need not be a member of the company. The instrumentappointing a proxy in order to be effective should be duly stamped, completed and signed and must bedeposited at the Registered Office of the Company not less than 48 hours before the time for holdingthe aforesaid meeting.

2. The members are requested to:

i. Intimate change, if any, in their registered address at an early date.

ii. Bring their copies of Annual Report and Attendance Slip with them at the Annual General Meeting.

3. As per the provisions of the Companies act, 1956, shareholders are now entitled to make nominationin respect of shares held by them. Shareholders desirous of making nomination are requested to sendtheir request in Form No.2B in duplicate to the company.

4. The Equity Shares of the Company are listed at The Stock Exchange, Ahmedabad and The MadrasStock Exchange, Chennai. The Company has paid annual Listing Fees of both the Stock Exchanges.

5. The members are advised to submit their share certificate to Link Intime India Private Limited, Registrarand Share transfer agent of the company for the purpose of transfer & Demat.

6. Information under clause 49VI A of the Listing Agreements regarding re-appointment of Mr. OmprakashO. Jain and Mr. Ravindra O. Jain :

Mr. Omprakash O. Jain :-

He has been Chairman in the company for more than 19 years. He is providing a valuable support tothe management of company. He is having experience of more than 25 years in this field and havingvery good contacts in this field.

Mr. Ravindra O. Jain :-

He is graduate and having experience of more than 6 years in this field. The Company will continue tobenefit from their knowledge and experience.

EXPLANATORY STATEMENT IN PERSUANT TO SECTION 173 (1) of COMPANIES ACT, 1956

Item 5

During the year, the company has started augmenting its core business. The Company has startedprocess of disposing of its non core business in order to improve profitability. In the similary line, thecompany has disposed of its nonprofitable business of inbound call Center during the year. This hasgenerated surplus office space at at Office no. 414, Sakar –II, Ellisbridge, Ashram Road, Ahmedabad.

No director is interested in this resolution.


DIRECTORS’ REPORTToThe Members

Your Directors have great pleasure in presenting the 19th ANNUAL REPORT and the Audited Statement ofAccounts of the Company for the year ended on 31st March, 2013

Particulars Amount for2012-13 (Rs.)

Amount for2011-12 (Rs.)

Total Income 495.22 624.27Total Expenditure (434.24) (537.01)Profit Before Depreciation, Non Cash Expenses &Tax 60.99 87.26Less: Depreciation & Other Non Cash Expenses 32.69 (56.01)Profit Before Tax 28.29 31.25

Less: Provision for Taxes 8.00 (6.00)Add: Deferred Tax Asset (0.69) 11.62Less: Income tax Short Provision of earlier year (0.43) (0.02)Profit After Tax 19.17 36.85Add: Balance Brought Forward from Previous Year 30.25 26.99Less: Deferred Tax of Prior Period ----- (33.59)Balance Carried to Balance Sheet 49.41 30.25

PERFORMANCE REVIEW :-

During the year, the company’s turnover witnessed considerable fall compared to previous year. The mainreason being the company has disposed off its all noncore business to improve profitability. This year the netprofit decrease from Rs. 31.24 lakhs to 28.29 lakhs. The net profit ratio has improved from 5.31% to current6.35% during year. Your directors expect that focused business model will yield good results in future.

DIVIDEND :-

The dividend pay out for the year under the review has been formulated in accordance with the company’s policyto pay substantial dividend linked to long term performance, keeping in view the company’s need for capital forits growth plans and the intent to finance through internal accruals to maximum. Your directors have alwayswished to appreciate the trust and faith of its members by paying them appropriate dividends.

Even though, the company has maintained good earning track records, your directors consider need to ploughback current earnings to meet its future need. Therefore, your directors do not recommend any dividend currentyear.

PUBLIC DEPOSITS :-

The company has not accepted any deposit from public within the meaning of Section 58-A of the CompaniesAct, 1956 and Rules made there under.

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DIRECTORS’ REPORT

PARTICULARS OF EMPLOYEES :-

There were no employees whose remuneration were in excess of the limits prescribed under section 217(2A)of the Companies Act, 1956 read with the Companies (Particulars of Employees) Rules, 1975, as amended.

DIRECTORS:-

In accordance with the provisions of the Companies Act, 1956 and Articles of Association the Company,Mr. Omprakash O. Jain and Mr. Ravindra O. Jain directors of the Company, who retires by rotation andbeing eligible, offer them selves for re-appointment.

AUDITORS:-

M/s. Baheti Bhadada & Associates, auditors of the company hold office till the conclusion of the ensuingAnnual General Meeting and are eligible for reappointment. The company has received a letter from themto the effect that their appointment as auditors, if made, would be within the limits under section 224(1-B)of the Companies Act, 1956.

CONSERVATION OF ENERGY :-

Since the company is engaged in service business, its operation does not involve substantial consumptionof energy. However, the company has taken necessary care to conserve scares resources of the nation.

TECHNOLOGY ABSORPTION:-

The company has not imported any technology but the company is very conscious to absorb necessarytechnological advancement in its service. The company is continuously upgrading existing technology aswell as innovating for cost reduction and quality improvements.

FOREIGN EXCHANGE EARNINGS AND OUTGO:-

• Foreign Exchange earnings - Rs. NIL• Foreign Exchange outgo - Rs. NIL

AUDITOR’S OBSERVATIONS :-

The observations contained in the Auditor’s Report are self-explanatory and, therefore, no comments arecalled for separately.

CORPORATE GOVERNANCE:-

As per clause 49 of the Listing Agreement, a separate Report on Corporate Governance together withManagement Discussion and Analysis and certificate from Company’s Auditors is annexed and forms partof this report.


DIRECTORS’ REPORT

DIRECTORS’ RESPONSIBILITY STATEMENT :-

Pursuant to section 217(2AA) of the Companies Amendment Act, 2000 it is hereby Confirm that:

a) In the preparation of Annual Accounts, the applicable Accounting Standards have been followed.

b) Appropriate Accounting Policies have been selected and applied consistently, and have made judgmentsand estimates that are reasonable and prudent so as to give a true and fair view of the state of affairsof the company as at 31st March, 2013 and of the Profit of the company for the year ended on thatdate.

c) Proper and sufficient care has been taken for the maintenance of adequate accounting records inaccordance with the provisions of the Companies Act, 1956 for the safeguarding the assets of thecompany and for preventing and detecting fraud and other irregularities.

d) The accounts for the financial year ended 31st March, 2013 have been prepared on a going concernbasis.

INSURANCE :-

The current assets and fixed assets of the company are adequately insured against all types of risks.

ACKNOWLEDGEMENT:-

Your directors acknowledge with gratitude, the patronage of its esteemed customers, the strength it derivesfrom its employees at all levels, the support from its Bankers and the loyalty of the large family of thecompany’s customers, suppliers and shareholders.

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BY THE ORDER OF BOARD


Place: AhmedabadDate : 08/05/2013


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CORPORATE GOVERNANCE

Citizen Infoline Limited has established a tradition of the higheststandards of corporate governance principals and best practices.The Company is committed to introducing corporate governancepractices in tandem with domestics and international developmentsto position it to conform to the best governance practices.Our Governance philosophyThe company’s philosophy on corporate governance envisages theattainment of the highest levels of transference, accountability andequity in all facets of its operation and in all its interactions with itsstakeholders including shareholders, employees, the government,lenders and the society. The company believes that all its operationsand actions must the underlying goal of enhancing overallshareholder value, over a sustained period. In our commitment topractice sound governance principles, we are guided by thefollowing core principles: Transparency

To maintain the highest standards of transparency in all aspectsof our interactions and dealings.

DisclosuresTo ensure timely dissemination of all price sensitive informationand matters of interest to our stakeholders.

AccountabilityTo demonstrate highest levels of personal responsibility andcontinually affirm that employees are responsible to themselvesfor the pursuit of excellence.

CompliancesTo comply with all the laws and regulations as applicable tothe company.

Ethical conductTo conduct the affairs of the company in an ethical manner.

Stakeholders’ interestsTo promote the interests of all stakeholders includingcustomers, shareholders, employees, lenders, vendors andthe community.

Governance practices beyond regulatory requirementsOur governance practices go beyond the statutory and regulatoryrequirements. Our endeavor is to follow the spirit of goodgovernance than mere compliance with the conditions specified byregulatory authorities. With this objective, we have formulated, interalias, the following policy documents and introduced best practicesof governance:1. Values and commitmentsWe have set out and adopted policy documents on ‘values andcommitments’ of the Company. We believe that any businessconduct can be ethical only when it rests on the nine core values ofhonesty, integrity, respect, fairness, purposefulness, trust,responsibility, citizenship and caring.2. Code of EthicsOur policy document on ‘code of ethics’, in essence, directs thatour employees should conduct the business with integrity byexcluding consideration of personal advantage.3. Business policies

Our ‘business policies’ contains the policy on fair marketpractices, inside information, financial records and accounting

integrity, external communication, work ethics, personalconduct, policy on prevention of sexual harassment, health,safety & environment and quality.

4. Separation of the Board’s supervisory role from theexecutive management

In line with the best global practices, we have adopted the policy ofseparating the Board’s supervisory role from the executivemanagement and splitting the posts of chairman and MD.

5. Prohibition of insider trading policy

This document contains the policy on prohibiting trading in the equityshares of the Company, based on inside or privileged information.

6. Prevention of sexual harassment

Our policy on prevention of sexual harassment aims at promotinga productive work environment and protects individual rights againstsexual harassment.

7. Whistle blower policy

Our whistle blower policy encourages disclosure in good faith ofany wrongful conduct on a matter of general concern and protectsthe whistle blower from any adverse personnel action.

8. Risk management

Our risk management procedures ensure that the managementcontrols risks through means of a properly defined frame work.

I. Boardroom practices

i. Board charter

The board of directors has adopted a comprehensive board charter.The charter has set out matters relating to board composition, scopeand functions of the board and its committees, etc.

ii. Tenure of independent directors

Tenure of independent directors on the board of the Company shallnot extend beyond stipulated years, subject to their re-appointmenton retirement by rotation as per statutory provisions.

iii. Director’s interaction with shareholders

Mr. Omprakash Jain, Mr. Ravindra O. Jain and Mr. Harsh O. Jaininteract with shareholders on their suggestions and queries whichare forwarded to the compliance officer.

iv. Meeting of independent directors with operating team

The independent directors of the company meet in executivesessions with the operating teams in each of the respective areas,on a regular basis as they deem necessary. These executive sessiondiscussions may include topics such as, operating policies andprocedures; risk management strategies;

Measures to improve efficiencies; performance and compensation;strategic issues for board consideration; flow of information todirectors; management progression and succession and others asthe independent directors may determine. During these executivesessions, the independent directors have access to members ofmanagement and other advisors, as the independent directors maydetermine and deem fit.


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v. Commitment of directors

The board meeting dates for the entire financial year are scheduledin the beginning of the year and an annual calendar of meetings ofthe board and its committees is circulated to the directors. Thisenables the directors to plan their commitments and facilitatesattendance of all directors at the meetings of the board and itscommittees. Such advance planning of meetings enable thedirectors to plan their commitments, particularly in the context thatthe meetings of the board normally extend over the entire workingday.vi. Governance practices being followed to promote theinterests of our stakeholders

We have in the recent past introduced several trend settinggovernance practices to improve stakeholder satisfaction.

Compliance with clause 49 of the listing agreementCitizen Infoline Limited is fully compliant with the mandatoryrequirements of clause 49 of the listing agreement formulated bySecurities and Exchange Board of India (SEBI).We present our report on compliance of governance conditionsspecified in clause 49.I. Board of directors

1. Board composition - Board strength and representation

As at March 31, 2013, the board consisted of six members. Thecomposition of and the category of directors on the board of thecompany were as under:Categroy Particuars of DirectorPromoter & Executive - Mr. Omprakash JainDirector - Mr. Ravindra O Jain

- Mr. Harsh O. Jain(Managing Director)

Promoter & Non - NilExecutive Director

Independent & Non - Mr. Pukhraj VedExecutive Directors - Mr. Vikas H. Jirawala

Nominee Director - Nil

2. Conduct of board proceedings

The day to day business is conducted by the officers and themanagers of the Company under the direction of the board led bythe Chairman. The board holds five to six meetings every year toreview and discuss the performance of the company, its plans,strategies and other pertinent issues relating to the company.The board performs the following specific functions in addition tothe oversight of the business and the management: Review, monitor and approve major financial and business

strategies and corporate actions. Assess critical risks facing the company their mitigation. Provide counsel on the selection, evaluation, development and

compensation of senior management. ensure that processes are in place for maintaining the integrity of

the company the financial statements compliance with law relationships with all the stakeholders

Delegation of appropriate authority to the seniorexecutives of the company or effective managementof operations.

3. Board meetingsSix Board Meetings were held during the year. They were held on31 May 2012, 31 July 2012, 23 September 2012, 31 October 2012,25 January 2013 and 28 March 2013.

4. Attendance of directors at the Board Meetings held during2012-13 and the last Annual General Meeting (AGM)

Directors Meetings Meetings AGMIn Year Attended

Mr. O. L. Jain 6 6 YesMr. P. K. Ved 6 4 YesMr. R. O. Jain 6 6 YesMr. H. O. Jain 6 6 YesMr. V. H.Jirawala 6 4 Yes

Notes: None of Directors have business relationship with the Company. None of the director receive any loans and advance from the

Company

5. Other directorships

None of the directors holds directorships in more than 15 publiclimited companies.The details of directorships (excluding private limited, foreigncompany and companies under section 25 of the Companies Act,1956), Chairmanships and the Committee memberships held bythe directors as on March 31, 2013

Name of Number of otherDirectors Membership/Directorship

Mr. O. L. Jain 1Mr. P. K. Ved NilMr. R. O. Jain 1Mr. H. O. Jain NilMr. V. H.Jirawala Nil

Notes:1. The information provided above pertains to the following

committees in accordance with the provisions of clause 49 ofthe listing agreement:

a. Audit committeeb. Shareholders/investors’ grievances committee2. Membership of committees includes chairmanship, if any.6. Membership of board committees

No director holds membership of more than 10 committees of boardsnor is any director a chairman of more than 5 committees of boards.7. Details of Directors

The abbreviated resumes of all Directors are furnished hereunder: Shree Omprakash Jain

He has been chairman of Citizen Group of Companies for last 19years. He is the pioneer of the company towards new goals andachievement. The company is having his valuable services sinceits incorporation.


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Shree Pukhraj K Ved

He has been director in the company for more than 10 years. He isproviding a valuable support to the management of company. He ishaving experience of more than 37 years in the field of textile tradingand having very good contacts in textile market. Shree Ravindra O Jain

He has been director in the company for more than 7 years. He isproviding a valuable support to the management of company. He isyoung and dynamic face of the company. Shree Vikas H Jirawala

He is a Chartered Accountant and will be providing a value ablesupport to the management of company. He is young and dynamicface of the company. Shree Harsh O. Jain

He is a MBA in finance and has been director in the company for 5years. He is providing a valuable support to the management ofcompany. He is young and dynamic face of the company.8. Insurance coverage

The company has not obtained director’s liability insurance coveragein respect of any legal action that might be initiated against directors.II. Audit Committee:

The Audit Committee has been constituted w.e.f. March 28,2003.Audit Committee presently comprises of one executive andtwo non-executive Directors, namely Mr. Pukhraj K. Ved Mr. Vikas H. Jirawala Mr. Omprakash JainAll the members of Audit Committee have good knowledge offinance, accounts and company law. The chairman of committeehas financial management expertise. The committee held 4(four)meetings during the year. The audit committee also advises themanagement on the areas whereCorporate Governance

internal audit can be improved. The minutes of the meetings of theaudit committee are placed before the board. The terms of referenceof the audit committee are in accordance with all the items listed inclause 49 (II) (D) and (E) of the listing agreement and section 292Aof the Companies Act, 1956, as follows:

1. Overseeing of the company’s financial reporting process andthe disclosure of its financial information to ensure that the financialinformation is correct, sufficient and credible.

2. Recommending the appointment, reappointment andreplacement/removal of statutory auditors and fixation of audit fee.

3. Approve payment for any other services by statutory auditors.

4. Reviewing with management the annual financial statementsbefore submission to the board, focusing primarily on;

a. Matters required being included in the directors’ responsibilitystatement included in the report of the board of directors.

b. Any changes in accounting policies and practices.

c. Major accounting entries based on exercise of judgment bymanagement.

d. Qualifications in draft statutory audit report.

e. Significant adjustments arising out of audit.

f. Compliance with listing and other legal requirements concerningfinancial statements.

g. Any related party transactions.

5. Reviewing with the management the quarterly financial statementsbefore submission to the board for approval.

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

7. Reviewing the adequacy of internal audit function, including thestructure of the internal audit department, staffing and Seniority ofthe official heading the department, reporting structure coverageand frequency of internal audit.

8.Discussion with internal auditors any significant findings and followup thereon.

9. Reviewing the findings of any internal investigations by the internalauditors into matters where there is suspected fraud or irregularityor a failure of internal control systems of a material nature andreporting the matter to the board.

10. Discussion with statutory auditors before the audit commencesabout nature and scope of audit as well as post-audit discussion toascertain any area of concern.

11. To look into the reasons for substantial defaults in the paymentto the depositors, shareholders (in case of non-payment of declareddividends) and creditors.

12. To review the functioning of the Whistle Blower mechanism, incase the same is existing.

13. Carrying out any other function as is mentioned in the terms ofreference of the audit committee.

14. Review the following information:

Management discussion and analysis of financial condition andresults of operations;

Internal audit reports relating to internal control weaknesses;

Management letters / letters of internal control weaknessesissued by statutory / internal auditors;

Statement of significant related party transactions; and

The appointment, removal and terms of remuneration of theauditor shall be subject to review by the Audit Committee.

The Audit Committee has the following powers:

i. To investigate any activity within its terms of reference.

ii. To seek any information from any employee.

iii. To obtain outside legal and professional advice.

iv. To secure attendance of outsiders with relevant expertise, if itconsiders it necessary.

Attendance at the meetings of the Audit committee held duringyear 2012-13


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Direcotrs Meetings Meetings

In Year Attended

Pukhraj K. Ved 4 4Vikas H. Jirawala 4 4Omprakash Jain 4 4The Audit Committee held meetings on 31 May 2012, 31 July 2012,31 October 2012 and 25 January 2013. The meetings are regularlyheld at the end of each quarter.

The meetings are regularly held at the end of each quarter.

III. Nomination / Remuneration Committee

The nomination/remuneration committee of the board is constitutedto formulate from time to time,(a) Process for selection and appointment of new directors andsuccession plans; and

(b) A compensation structure for the members of the board. ShriOmprakash Jain is the Chairman of the Committee and the othermembers are Shree Pukhraj k Ved and Shree Ravindra O Jain.The Company currently has two executive Directors.

The remuneration policy is directed towards rewardingperformance. It is aimed at attracting and retaining high calibertalent.

Corporate Governance

The Company does have an incentive plan, which is linked toperformance and achievement of the Company’s objectives. TheCompany has no stock option scheme.

Total remuneration paid to Directors of the Company during theyear ended March 31, 2013 is Rs.16.80 Lacs.

Notes:

a. The company has not entered into any other pecuniaryrelationship or transactions with the non-executive directors.b. The company has so far not issued any stock options to itsdirectors.

Equity shares held by directors:

Particulars of Equity Shares held by the director as on 31 March

2013 is as follows

Name of Directors Equity Shares

Held

Jain Omparkash L. 758,500Jain Harsh O. 670,900Jain Ravindra O. 671,000

Directors’ remuneration policy:

The nomination / remuneration committee determines, thecompensation of the directors including their commission andESOPs. The key components of the company’s remuneration policyare:

Compensation will be a major driver of performance andcontribution.

Compensation will be competitive and benchmarked with aselected group of companies from the financial services sector.

Compensation will be transparent, fair and simple to administer.

Compensation will be fully legal and tax compliant.

IV. Shareholders/investors’ grievances committee:

The shareholders/investors’ grievances committee of theBoard currently comprises

A) Mr. Omprakash Jain

B) Mr. Pukhraj K. Ved

Particulars of investors’ complaints received is as follows

Particluars Quarries Quarries

Received Solved

Transfer of Shares Nil NilNon-receipts of Nil NilAnnual ReportNon-receipt of

Dividend warrants Nil Nil

Pending Share

Transfers Nil Nil

The Particulars of meetings held during the year are furnishedhereunder.

Particluars Meetings Meetings

In Year Attended

Pukhraj K Ved 4 4

Omprakash Jain 4 4

The meetings are held on 30th June 2012, 30th September 2012, 31st

December 2012 and 31st March 2013. The meetings are regularlyheld at end of each three months.

V. General Body Meetings:

The company held its last three Annual General Meetings as under:

For 2009-10 at 414, Sakar II, Ellis bridge, Ashram Road,Ahmedabad - 380006 on 26th July, 2010 at 12:00 noon.

For 2010-11 at 414, Sakar II, Ellis bridge, Ashram Road,Ahmedabad-380006 on 29th July, 2011 at 12.00 noon.

For 2011-12 at 414, Sakar II, Ellis Bridge, Ashram Road,Ahmedabad-380006 on 28th September, 2012 at 12.00 noon.

VI. Means of communication

Information like quarterly financial results and media releases onsignificant developments in the company as also presentations thathave been made from time to time to the media and has beensubmitted to the stock exchanges on which the company’s equityshares are listed, to enable them to put them on their own web sites.The Quarterly financial results are published generally in “WesternTimes” (Gujarati & English).

CITIZEN INFOLINE LIMITED 19TH ANNUAL REPORT 2012-2013VII General Share Holder Information:

i) Annual General Meeting : Saturday, 17 June 2013Date, Time and Venue : 411, Sakar – II, Ellishbridge,

Ashram Road, Ahmedabad -380 006.ii) Financial Year : 2013-2014

- Results for first quarterending June 30,2012 : On or Before 15th August,2013- Results for second quarterending September 30,2012 : On or Before 15th November,2013- Results for Third quarterending December 31,2012 : On or Before 15th February ,2014- Results for financial yearending March 31,2013 : On or Before 30th May,2014

iii) Date of Books Closure : Friday 14 June 2013 & Monday 17 June 2013iv) Dividend payment Date : N.A.v) Listing on Stock Exchanges : Madras Stock Exchange Ltd. & Ahmedabad Stock Exchange Ltd.Demate ISIN in NSDL & CDSL : INE473L01018vi) Distribution of Share holding as on 31st March, 2013:

vii) Shareholding Pattern as on 31st March 2013:

viii) Dematerialization of Shares:

The Equity Shares of the Company are traded compulsorily in the dematerialized form. The Company hasentered into an agreement with both National Depository Ltd. (NSDL) and Central Depository SecuritiesLtd.(CDSL), whereby the shareholders have option to dematerialize their shares with either of the depository.

Status of Dematerialization as on 31st March 2013

Up to 500 5693 88.79 772500 14.31501-1000 338 5.27 288600 5.351001-2000 182 2.84 285800 5.302001-3000 90 1.40 228300 4.233001-4000 24 0.37 84900 1.574001-5000 31 0.49 147500 2.735001 -10000 32 0.50 247400 4.5810001 & Above 22 0.34 3342300 61.93Total 6412 100.00 5397300 100.00

Distribution ofShares (Slab wise)

No. of Shareholders Percentage of totalshareholders

Total Shares Percentage of Shares

Promoter and promoter Group 3063200 56.75Bodies corporate 139100 2.58NRI/Foreign national/foreign corporate bodies 35000 0.65Mututal Fund/UTI/ Financial Institution/Bank 22900 0.42Indian Public 2135900 39.54Clearing Members NIL NILHindu Undivided Families 1200 0.02Total 5397300 100.00

Total Shares % to equityCategory

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National securities Depository Ltd. 3080300 57.07 7Central Depository Services (India) Ltd. 13100 0.24 34Total Dematerialized 3093400 57.31 41Physical 2303900 42.59 6371Grand Total 5397300 100.00 6412

% of Total capital No. Of ShareholderParticulars No of Shares


xi) Share Transfer System:Share Transfer have been normally processed and returnedwithin 21 days from the date of lodgment, provided thenecessary documents were in order.Corporate Governance

The company has appointed a common agency on a single pointfor physical and demats registry work. The address of theRegister and share Transfer Agent is as under:

LINK INTIME INDIA PRIVATE LIMITED211, Sudharshan Complex, Nr. Mithakhali Underbridge,Navrangpura, Ahmedabad – 380009

x) Investor Correspondance may be address to: Mr. Omprakash Jain

411, Sakar – II, Ellishbridge, Ashram road, Ahmedabad – 380006

Phone No. – 91-79-26585555Email : [email protected]

Or At the Register and share Transfer Agent Address asmentioned above.

VIII. Compliance with other mandatory requirements

1. Management discussion and analysisA management discussion and analysis report forms part of theannual report and includes discussions on various matters specifiedunder clause 49(IV) (F) of the listing agreement.

2. SubsidiariesThe company do not have any subsidiary company as per clause49 (III) of the listing agreement.

3. Disclosuresa. Related party transactionsThe company has entered into related party transactions as setout in the notes to accounts, which are not likely to have a conflictwith the interest of the company.b. No Penalty or strictures No penalty or stricture has been imposed on the company by thestock exchanges or SEBI or any other statutory authority, on anymatter related to the capital markets, during the last 3 years.c. Disclosure of accounting treatmentIn the preparation of financial statements, the company has followedthe Accounting Standards issued by the Institute of CharteredAccountants of India to the extent applicable.d. Disclosures on risk managementThe company has laid down procedures to inform the members ofthe board about the risk assessment and minimization procedures.A risk management committee consisting of senior executives ofthe company periodically reviews these procedures to ensure thatexecutive management controls risk through means ofa properly defined framework. The company has framed the riskassessment and minimization procedure which is periodicallyreviewed by the Audit Committee and the Board.e. Code of conductThe Company adopted the code of conduct and ethics for directorsand senior management. The code has been circulated to all themembers of the board and senior management .The board

members and senior management have affirmed their compliancewith the code and a declaration signed by the Shree OmprakashJain Chairman of the Company appointed is given below:“It is hereby declared that the company has obtained from allmembers of the board and senior management affirmation that theyhave complied with the code of conduct for directors and seniormanagement of the company for the year 2012-13.”

O L JainChairman

Corporate Governance

f. Review of directors’ responsibility statement

The board in its report has confirmed that the annual accounts forthe year ended March 31, 2013 have been prepared as perapplicable Accounting Standards and policies and that sufficient carehas been taken for maintaining adequate accounting records.

VIII. Compliance with non-mandatory requirements

1. Remuneration Committee

The board has set up a remuneration committee details whereofare furnished at Sr. No. III of this report.

2. Shareholder rights

The quarterly financial results including summary of significant eventsof relevant period of three months are published in newspapers

3 Audit qualifications

Strategic decisions were taken during the year resulting in unqualifiedfinancial statements of the company.

4. Whistle blower policy

The company has formulated a policy to prohibit managerialpersonnel from taking adverse personnel action against employeesdisclosing in good faith alleged wrongful conduct on matters of publicconcern involving violation of any law, mismanagement, gross wasteor misappropriation of public funds, substantial and specific dangerto public health and safety or an abuse of authority. The Policy alsolays down the mechanism for making enquiry in to whistle blowercomplaint received by the company. Employees are aware of anyalleged wrongful conduct are encouraged to make a disclosure tothe audit committee. Employees knowingly making false allegationsof alleged wrongful conduct to the audit committee shall be subjectto disciplinary action. No personnel of the company have been deniedaccess to the grievance redressed mechanism of the company.

Auditor’s certificate on corporate governance:

The Auditors certificate on compliance of clause 49 of the listingagreement relating to corporate governance is published elsewherein this report.

12


AUDITOR’S CERTIFICATE ON CORPORATE GOVERNANCE

To,The Members ofCitizen Infoline Limited

We have examined the compliances of conditions of Corporate Governance by Citizen Infoline Limited (‘theCompany’) for the year ended on 31 March 2013 as stipulated in Clause 49 of the Listing Agreement of the saidCompany with Stock Exchanges.

The compliance of conditions of Corporate Governance is the responsibility of Management. Our examinationwas limited to review of the procedures and implementations thereof adopted by the Company for ensuringcompliance of conditions of Corporate Governance. It is neither an audit or nor an expression of opinion on thefinancial statement of the Company.

In our opinion and to the best of our information and according to the explanations given to us, we certify that theCompany has complied with the conditions of Corporate Governance as stipulated in Clause 49 of the ListingAgreement of the said Company with Stock Exchanges.

We state that no grievances are pending for a period exceeding one month against the Company as per therecords maintained by the Shareholders/ Investors Grievance Committee/ Management of the Company.

We further state that such compliance is neither an assurance as to the future viability of the Company nor theefficiency or effectiveness with which the management has conducted the affairs of the Company.

For Baheti Bhadada & Associates(Chartered Accountants)

B. K. BahetiPlace: Ahmedabad (Partner) Firm

Registration no. 100685W

Date: 08/05/2013

Place: Ahmedabad

13


BAHETI BHADADA & ASSOCIATESCHARTERED ACCOUNTANTS

201, SHAILY COMPLEX,B/H OLD GUJARAT HIGH COURT,

ASHRAM ROAD, AHMEDABAD-380009

14

AUDITOR’S REPORTTo,The Members ofCITIZEN INFOLINE LIMITED

We have audited the attached Balance-Sheet of CITIZEN INFOLINE LIMITED as on 31 March 2013, relatedProfit & Loss Account of the company for the year ended on that date annexed thereto and Cash Flow Statementfor the period ended on that date and summary of significant accounting policies and other explanatory information.

1. Management is responsible for the preparation of these financial statements that give a true and fairview of the financial position, financial performance and cash flows of the Company in accordance with theAccounting 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 thepreparation and presentation of the financial statements that give a true and fair view and are free frommaterial misstatement, whether due to fraud or error.

2. Our responsibility is to express an opinion on these financial statements based on our audit. We conductedour audit in accordance with the Standards on Auditing issued by the Institute of Chartered Accountants ofIndia. Those Standards require that we comply with ethical requirements and plan and perform the audit toobtain 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 disclosures in thefinancial statements. The procedures selected depend on the auditor’s judgment, including the assessmentof the risks of material misstatement of the financial statements, whether due to fraud or error. In makingthose risk assessments, the auditor considers internal control relevant to the Company’s preparation andfair presentation of the financial statements in order to design audit procedures that are appropriate in thecircumstances. An audit also includes evaluating the appropriateness of accounting policies used and thereasonableness of the accounting estimates made by management, as well as evaluating the overallpresentation of the financial statements. We believe that the audit evidence we have obtained is sufficientand appropriate to provide a basis for our audit opinion.

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

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

(b) in the case of the Profit and Loss Account, of the profit/ loss 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.


15

FOR, BAHETI BHADADA & ASSOCIATESCHARTERED ACCOUNTANTS

(B. K. BAHETI)PARTNER

Firm Reg. No.100865W

Plac : Ahmedabad.Date : 08/05/2013

REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS

1. As required by the Companies (Auditor’s Report) Order, 2003 (“the Order”) issued by the Central Governmentof India in terms of sub-section (4A) of section 227 of the Act, we give in the Annexure a statement on thematters 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 werenecessary for the purpose of our audit;

b. in our opinion proper books of account as required by law have been kept by the Company so far as appearsfrom our examination of those books and proper returns adequate for the purposes of our audit have beenreceived from branches not visited by us;

c. the Balance Sheet, Statement of Profit and Loss, and Cash Flow Statement dealt with by this Report are inagreement with the books of account and with the returns received from branches not visited by us;

d. in our opinion, the Balance Sheet, Statement of Profit and Loss, and Cash Flow Statement comply with theAccounting Standards referred to in subsection (3C) of section 211 of the Companies Act, 1956;

e. on the basis of written representations received from the directors as on March 31, 2013, and taken on recordby the Board of Directors, none of the directors is disqualified as on March 31, 2013, from being appointed as adirector in terms of clause (g) of sub-section (1) of section 274 of the Companies Act, 1956.

f. Since the Central Government has not issued any notification as to the rate at which the cess is to be paidunder section 441A of the Companies Act, 1956 nor has it issued any Rules under the said section, prescribingthe manner in which such cess is to be paid, no cess is due and payable by the Company.


16

ANNEXURE TO THE AUDITOR’S REPORT(Referred to in paragraph 3 of our report of even date)

Nos of Parties 6 (Six)Loan Given during the year Rs. 3,42,99,935Received back During the year Rs. 1,54,62,095Maximum Outstanding in Year Rs. 2,84,09,573Closing Balance Rs. 1,99,04,347

I. Fixed Assets: -

(a) The Company has maintained proper records to showing full particulars including quantitative detailsand situation of fixed assets.

(b) The management has physically verified all the fixed assets at the year end. No material discrepancieshave been noticed on such verification.

(c) During the year the Company has not disposed of substantial part of its fixed assets.

II. Inventories :-(a) The Company is dealing in service industry. Hence, this clause is not applicable to the company.

III. (a) According to information and explanations given to us, the company has not granted interest freeunsecured loans payable on demand covered in the register maintained under section 301 of theCompanies Act, 1956.

(b) (i) According to information and explanations given to us, the Company has given loans to fifteenparties covered in the register maintained under section 301 of the Companies Act, 1956. Particularsare as under.

(ii) In our opinion, the rate of interest and other terms and conditions on which loans have been takenfrom the parties, listed in the register maintained under section 301 of the Companies Act, 1956 arenot, prima facie, prejudicial to the interest of the Company.

(iii) As per the information and explanation given to us, the Company is regularly receiving the principalamounts as stipulated and has been regular in the payment of interest where applicable.

IV. The management of Company is responsible for establishing and maintaining an internal controlstructure. In fulfilling this responsibly, estimates and judgments by management are required toassess the expected benefits and related costs of internal control structure. The objective of internalcontrol structure are to provide management with reasonable, but not absolute assurance thattransactions are executed in accordance with management’s authorization and recorded properlyto permit the preparation of financial statements in accordance with generally accepted accountingprincipals. Because of inheriting limitations of internal control structure, errors/irregularities mayoccur and not be detected. Also, projections of any evaluation of the structure to future period issubject to the risk that procedures may become inadequate because of changes in conditions orthat effectiveness of the design and operation policies and procedure may deteriorate.

In our opinion and according to the information and explanations given to us and on the basis ofaudit procedures performed in accordance with generally accepted audit practices in India for thepurpose of reporting on true and fair view of financial statements, there are adequate internalcontrol procedures commensurate with the size of the Company and the nature of its businesswith for the purchase of fixed assets and for the sale of Services. There is no continuing failure tocorrect major weaknesses in the internal control.


17


(B. K. BAHETI)PARTNER

Firm Reg. No.100865WPlac : Ahmedabad.Date : 8/05/2013

V. (a) According to the information given to us, the transactions during the year that need to be enteredinto a register in pursuance of section 301 of the Companies Act, 1956 are already registered.

(b) In our opinion and according to the information and explanations given to us, the transactionsmade in pursuance of such contracts or arrangements (including transactions of finance) exceedingthe value of rupees five lakhs during the year have been made at prices which are reasonablehaving regard to the prevailing market prices at the relevant time.

VI. The Company has not accepted deposits from the public within the provisions of sections 58A and58AA of the Companies Act, 1956 and the Companies (Acceptance of Deposits) Rules, 1975.

VII. In our opinion, the Company has an internal audit system commensurate with its size and nature ofits business.

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

IX. According to the information and explanation given to us, there were no undisputed amounts payablein respect of Income-Tax, Wealth-Tax, Customs Duty and Excise Duty which have remainedoutstanding as on 31st March, 2013 for a period of more than six months from the date they becamepayable.

X. The Company has no accumulated losses during the year and it has not incurred cash lossesduring the year or financial year immediately proceeding.

XI. On the basis of the verification of records and information and explanations given to us, the Companyhas not defaulted in repayment of dues to financial institutions or banks.

XII. The Company has not granted loans and advances on the basis of security by way of pledge ofshares, debentures and other securities.

XIII. The Company is not a chit fund and nidhi / mutual benefit fund/ society. Therefore, the provisions ofclause 4(xii) of the Companies (Auditor’s Report) Order, 2003 are not applicable to the company.

XIV. The Company is not dealing or trading in shares, securities, debentures and other investments.XV. The Company has not given any guarantees for loans taken by others from banks and financial

institutions during the year.XVI. The Company has not obtained any term loan during the year.XVII. According to the information and explanations given to us and on an overall examination of the

balance sheet of the company, we report that no funds raised on short-term basis have been usedfor long term investment.

XVIII. During the year, the Company has not made any preferential allotment of shares to parties andcompanies covered in the Registered maintained under section 301 of the Act.

XIX. According to the information and explanations given to us, during the period covered by our auditreport, the company has not issued debentures.

XX. The Company has not raised any money by public issue during the year.XXI. Based on the audit procedure performed and the representation obtained from the management,

we report that no case of fraud on or by the Company has been noticed or reported during the yearunder audit.

18

CITIZEN INFOLINE

LIMITED

411, Sakar

- II,

Ellisbridge

Corner,

Ashram

Road,

Ahmedabad-380

006.

BALANCE SHEET

AS

AT

31ST

MARCH,

2013

ParticularsNo.

end of

current

reporting period

end

of

previous

reporting period

I. EQUITY

AND

LIABILITIES

(1) Shareholder's

Funds

(a) Share

Capital 1 53,973,000

53,973,000

(c) Money received against share warrants - -

(2) Share Application money pending allotment - -

(3) Non-Current Liabilities

(a) Long-Term Borrowings - -

(c) Other Long Term Liabilities - - (d) Long Term Provisions - -

(4) Current Liabilities(a) Short-Term Borrowings 3 5,790,759 3,515,604 (b) Trade Payables 4 1,640,285 1,174,061

(d) Short-Term Provisions 6 1,308,149 1,495,201 Total Equity & Liabilities 70,859,900 68,408,412

II.ASSETS

(1) Non-Current Assets

(a) Fixed

Assets 7

(ii)

Depreciation

10,644,745

9,412,337

(iii) Net

Block 28,185,778

31,114,583

(b) Non-current

investments 8 2,724,200

224,200

(c) Deferred

tax

assets

(net) -

(d) Long

term

loans

and

advances 9 35,482,080

30,632,869

(e) Other

non-current

assets 10 -

1,272,439

(2) Current

Assets

(a) Current

investments -

-

(b) Inventories 11 731,400

1,044,100

(c)

Trade

receivables 12 2,352,908

2,635,334

(d)

Cash

and

cash

equivalents 13 632,238

758,430

(e)

Short-term

loans

and

advances 14 115,077

150,310

(f)

Other

current

assets

15 636,219

576,147

Total

Assets 70,859,900

68,408,412

NOTES

TO

ACCOUNTS 22 0

0

FOR

BAHETI

BHADADA

&

ASSOCIATES FOR

, CITIZEN

INFOLINE

LIMITED

CHARTERED

ACCOUNTANTS

Notes

referred

to

above

and

notes

attached

there

to

form

an

integral

part

of

Balance

Sheet

This

is

the

Balance

Sheet

referred

to

in

our

Report

of

even

date.

(OMPRAKASH

JAIN)(

B.

K.

BAHETI)

(DIRECTOR)

PartnerMembership

No.

:

070818

(

RAVINDRA

JAIN)Firm

Reg.

No.:

100865W

DIRECTOR

DATE

:

08.05.2013

(HARSH JAIN)

(MANAGING DIRECTOR)

PLACE : AHMEDABADDATE : 08.05.2013


22

Sr.

No

Par

ticu

lars

Rat

eVa

lue

at th

ebe

ginn

ing

Addi

tion

durin

g th

eye

ar m

ore

than

180

days

Addi

tion

durin

g th

eye

ar le

ssth

an 1

80da

ys

Ded

uctio

ndu

ring

the

year

Valu

eat

the

end

Valu

eat

the

begi

nnin

g

Addi

tion

durin

g th

eye

ar

Ded

uctio

ndu

ring

the

year

Valu

eat

the

end

WDV

as

on31

.03.

2012

WDV

as o

n31

.03.

2011

ITa

ngib

le A

sset

s

1Ai

r Con

dition

er4.

75%

1,11

6,12

7-

--

1,11

6,12

739

0,86

453

,065

-44

3,92

967

2,19

872

5,26

32

Com

pute

r16

.21%

6,73

5,17

977

,075

1,53

2,27

040

1625

7,94

2,89

92,

534,

534

1,13

6,03

98,

918

3,66

1,65

54,

281,

244

4,20

0,64

53

EPAB

X4.

75%

1,92

4,72

3-

-1,

287,

087

637,

636

745,

002

40,7

3558

7,08

719

8,65

043

8,98

61,

179,

721

4Fu

rnitu

res &

Fixt

ures

6.33

%8,

717,

567

--

-8,

717,

567

4,06

0,73

455

2,32

7-

4,11

3,06

14,

104,

506

4,65

6,83

35

Offic

e Eq

uipm

ent

4.75%

569,

708

--

-59

6,70

815

1,16

328

,390

-17

9,55

341

7,15

544

5,54

56

Mot

or C

ycle

7.07

%18

2,64

0-

-78

,530

104,

110

80,1

077,

360

35,7

7451

,693

52,4

1710

2,53

37

Car W

agon

R9.

50%

410,

490

--

-41

0,49

016

7,24

738

,997

-20

6,24

420

4,24

624

3,24

38

Car S

wift

9.50

%67

1,34

7-

--

671,

347

176,

468

63,7

78-

240,

246

431,

101

494,

879

9Ca

r Hon

da ci

ty9.

50%

938,

500

--

938,

500

-19

2,93

0-

192,

930

--

745,

570

10Of

fice

Build

ing1.

63%

8,36

9,63

9-

--

8,36

9,63

991

3,28

813

6,42

6-

1,04

9,71

47,

319,

925

7,45

6,35

1S

UB

TO

TAL

(A)

2,96

,62,

920

77,0

751,

532,

270

2,70

5,74

228

,566

,523

9,41

2,33

72,

057,

117

824,

709

1,06

,44,

745

17,9

21,7

7820

,250

,583

IIIn

tang

ible

Ass

ets

--

-

Good

will

10,8

64,0

00 -

-60

0,00

010

,264

,000

--

--

10,2

64,0

0010

,864

,000

SU

B T

OTA

L (B

)10

,864

,000

--

600,

000

10,2

64,0

00-

--

-10

,264

,000

10,8

64,0

00

IIIC

apita

l W

ork-

in-p

rogr

ess

--

-

SU

B T

OTA

L (C

)-

--

IVIn

tang

ible

Ass

ets

Und

er-

--

Dev

elop

men

t

SU

B T

OTA

L (D

)-

--

--

--

--

--

-

Tota

l [A

+ B

+ C

+ D

](C

urre

nt Y

ear)

40,5

76,9

2077

,075

1,53

2,27

03,

305,

742

38,8

30,5

239,

412,

337

2,05

7,11

782

4,70

910

,644

,745

28,1

85,7

7831

,114

,583

(Pre

viou

s Ye

ar)

Gro

ss B

lock

De

pre

ciat

on

Ne

t B

lock

NO

TE

: 7

Fix

ed A

sset


27

1 Contingent Liabilities Nil2 Liabilities Disputed under Income Tax Nil3 Estimated Amount of Contracts remaining to be executed on Capital accounts and not provided for Nil4 Material Events occurring after Balance sheet date are taken into cognizance. There have been no material

changes or events since the date of balance sheet affecting financial statements as on the Balance sheetdate. Further, the dates of Balance sheet, no events or circumstances have occurred, though properlyexcluded from the accounts, are of such importance that they should be disclosed through any medium.

AmountRs.

Sr.No.

Particulars

NOTES - 22

SIGNIFICANT ACCOUNTING POLICIES

1. BASIS OF PREPARATION OF FINANCIAL STATEMENTS:-a) The financial statements have been prepared under the historical cost convention in accordance with the generally

accepted accounting principles on going concern basis and provisions of the Companies Act, 1956 as adoptedconsistently by the company.

a) The company generally follows mercantile system of accounting and recognizes significant items of incomeand expenditure on accrual basis. Considering the matching concept, the company recognizes its revenue frominformation service business on receipt basis.

AS – 1 – Disclosure of Accounting PoliciesThe Accounting Principles and policies recognized as appropriate for measurement and reporting of the financialperformance and the financial position on mercantile system and recognize items of income and expenditure onaccrual basis. The statement on Significant Accounting policy excludes disclosures regarding AccountingStandards in respect of which there are no material transactions during year.

AS – 3 – Cash Flow StatementCash flow statement, as per AS – 3 is annexed with financial statements.

AS – 4 – Cpmtomgemcoes amd Evemts pccirromg after Balance Sheet date.

AS – 5 – Net Profit and Loss for the period, extra ordinary items and change in accounting policy.

AS – 6 – Depreciation Accountinga) The Gross Block of fixed assets is stated at cost of acquisition or construction including any cost attributable to

bringing the assets to their working condition for their intended use.b) Depreciation on fixed assets is provided on ‘Straight Line Basis’ at the rate prescribed in Schedule XIV to the

Companies Act, 1956. On additions of Assets the depreciation is charged at full rate on additions made before30 September 2012. The addition made afterwards is charged at half rate.

AS – 10 – Accounting of Fixed AssetsFixed Assets reflected in the financial statements are stated at their cost of acquisition including taxes, duties(Net of Refunds) and other identifiable direct charges incurred upto date the asset is put to use less accumulateddepreciation where charged.

AS – 13 – Accounting for Investments:-The investments of the company are classified in to investments held for maturity and investment held otherthan for maturity. The company values its investments held for maturity at cost price ignoring any changes in the

1 Net Profit for the periodAll items of income and expense in the period are included for determination of net profit of the year unlessspecifically mentioned elsewhere in the financial statements or required by an Accounting Standard. Prior perioditems, extra ordinary items and changes in accounting policy are disclosed only if those have material impact onthe affairs of the company.

2 Prior Period items: All material items of Income/ Expenditure pertaining to prior period and expenses to subsequentperiod are accounted separately. During the year, the company has debited deferred tax Rs. 33, 59,619 forearlier years, against opening balance of profit & loss account. The company has made error in calculations inthe preceding periods. The same has been corrected by debit to Opening balance of surplus account.

3 Extra ordinary Items : Nil4 Accounting PoliciesThe company has consistently followed accounting polices and there are no material changes

in accounting policy of the company from that followed in previous year.


28

Particulars Gujarat Segment Maharastra ConsolidatedAs on 31March 13

As on 31March 12

As on 31March 13

As on 31March 12

As on 31March 13

As on 31March 12

REVENUE

Domestic Services 350.85 478.66 94.67 109.54 445.52 588.20Export Sales 0.00 0.00 0.00 0.00 0.00 0.00 0.00Inter-segment Sales 0.00 0.00 0.00 0.00 0.00 0.00 0.00RESULTS

Segment ResultsUnallocated Corporate Exps 0.00 0.00 0.00 0.00 0.00 454.81 551.86Operating Profit 50.70 55.32 (16.76) (18.78) 0.00 33.94 36.54Interest Expense 6.77 3.24Interest Income 44.08 32.85Income Tax 8.00 6.00Net Profit 19.17 25.23OTHER INFORMATION

Segment assets 694.34 379.29 26.61 25.99 0.00 733.17 405.27Unallocated Corporate Assets 0.00 0.00 0.00 0.00 0.00 0.00 0.00Total Assets 694.34 379.29 38.83 25.98 0.00 733.14 405.27Segment Liabilities 57.91 35.15 18.26 0.00 0.00 76.17 0.00Unallocated Corporate Liabilities • 0.00Capital Expenditure 361.70 379.29 26.61 25.99 0.00 388.31 405.27Depreciation 96.07 85.74 10.35 8.39 0.00 106.42 94.12Other on Capital Expenditure 0.00 0.00 0.00 0.00 0.00 0.00 0.00

market price of the same. However, if change in value is on permanent basis, the same is recognized as profitor loss in profit and loss account. While investment held for other than maturity is valued at Market price byrecognizing the same in profit and loss account.

AS – 14 – Accounting of Amalgamation :-In 2009 the company has amalgamated Citizen Communication Limited by issuing the fully paid of shares of thecompany as purchase consideration. The amalgamation was in nature of merger. All the assets and liabilityacquired is shown at book value. However, the difference arise on amalgamation is not adjusted from profit andloss account or reserves of the company. The company has shown them as Goodwill on Asset side amountingto Rs. 1 crore. This has resulted to overstatement of reserves of the company by Rs. 1 crore.

AS – 15 – Accounting for retirement benefitsShort-term employee benefits are recognized as an expense at the undiscounted amount in the Profit and LossAccount of the year in which the related service is rendered.The eligible employees of the Company are entitled to receive benefits under the Provident Fund, a definedcontribution plan in which both the employees and the Company make monthly contributions at a specifiedpercentage of the covered employees’ salary (currently 12% of employees’ salary). The contributions as specifiedunder the law are paid to the Regional Provident Fund Commissioner and the Central Provident Fund under thePension scheme. The Company recognizes such contributions as expense of the year in which the liability isincurred.The Company provides for the encashment of leave or leave with pay subject to certain rules. The employeesare entitled to accumulate leave for availment as well as encashment subject to the rules. As per the regularpast practice followed by the employees, the company does not create provisions for leave encashment butrecognizes the same on actual payment basis.

AS – 17 – Segment ReportingThe Company operates six segments viz Ahmedabad, Rajkot, Surat, Baroda, Mumbai and Pune division on thebasis of Geographical Criteria. The company has preferred to give segment reporting based on statewideclassifications of its divisions.(Figures in Lakhs)


29

Particulars

2012-13 2011-12 2012-13 2011-12 2012-13 2011-12Purchase of Goods 0.00 0.00 0.00 0.00 0.00 0.00Sale of Goods 0.00 0.00 0.00 0.00 0.00 0.00Receiving of services 0.00 0.00 16.80 24.00 0.00 0.00Finance Charges(including loans and equitycontribution in cash or kind given) 0.00 0.00 0.00 0.00 0.00 0.00Interest Received 0.00 0.00 0.00 0.00 13.56 8.61Finance (including loans given) 0.00 0.00 0.00 0.00 343.00 249.42Any Other 0.00 0.00 0.00 0.00 0.00 0.00

Subsidiaries, FellowSubsidiaries and

Associates

Key ManagementPersonnel

List of Relatives of KeyManagerial Personnel

and Enterprise

(B) Segment accounting policies:In addition to the significant accounting policies applicable to the business segment as set out innotes to the accounts, the accounting Policies in relation to segment accounting are as under:

(a) Segment assets and liabilitiesSegment assets include all operating assets used by the segment and consist principally of fixedassets, inventories, sundry debtors and loans & advances less current liabilities .Segment assetsand liabilities do not include investment, inter corporate deposits, equity, reserves and surplusBorrowings, Provision for Contingencies and income-tax (Both current and deferred).

(b) Segment revenue and expensesSegment revenue and expenses are taken directly as attributable to the segment. It does notinclude interest income on inter- corporate deposits, Profit on sale of investments, Interest expense,Provision for Contingencies and income-tax.

v AS – 18 – Related Party DisclosureA. List of Related Parties and Relations1. Subsidiaries, Fellow Subsidiaries and Associates - None2. Key Management Personnel

- Shri Omprakash L. Jain- Shri Pukhraj K. Ved- Shri Harsh O. Jain- Shri Ravindra O. Jain- Shri Vikas H. Jirawala

3. List of Relatives of Key Managerial Personnel and Enterprise over which Key ManagementPersonnel and their relative excessive significant influence with whom transaction havetaken place during the year- Opera Exports Pvt. Ltd.- Oum International- K. Lite Fashions Pvt. Ltd.- Citizen Exports Pvt. Ltd.

A. Transactions with Related Parties :-(Rupees in Lakhs)


30

Particulars This Year Last YearEarning Available for share holders (Rs) 19,16,748 36,85,320Weighted average of Equity Shares 53,97,300 53,97,300Basic & diluted EPS Rs. 0.36 Rs. 0.60Face value of share Rs.10/- Rs.10/-

Particulars As on 31/03/2013 As on 31/03/2012Deferred Tax Liability Related to Fixed Assets 24.25 2.28Provision for Deferred Tax Liability/ Assets 0.69 (21.97)Total Deferred Tax Liability 24.95 24.25

Particulars This Year Last YearRemuneration 16,80,000 24,00,000Contribution to superannuation fund Nil ‘ NilTotal 16,80,000 24,00,000

AS – 20 – Earning Per Share

Basic Earning per Share are disclosed in the profit and loss account. There is no Diluted Earnings perShare as there are no dilative potential equity shares.

AS – 22 – Accounting for Taxes on Income

Provision for current income taxes is made on taxable income at the rate applicable to the relevantassessment year. Deferred taxes are recognized for future tax consequences attributable to timingsdifference between the financial statements determination of income and their recognition for tax purpose.The effect on deferred tax assets and liabilities of a change in tax rates is recognized for tax purposes.The effect on deferred tax assets and liabilities of a change in tax rates is recognized in Profit and LossAccount using the tax rates and tax laws that have been enacted or substantively enacted by balancesheet date.Deferred tax assets are recognized and carried forward only to the extent that there is a virtual certaintythat sufficient future taxable income will be available against which such deferred tax assets will berealized. The Company has recognized its deferred tax assets because the management has reasonablereasons to believe that the company will be able to realize this deferred tax assets in the near future.During the year the company has debited deferred tax of Rs. 33.59 lakhs pertaining to earlier accountingperiods, against opening balance of reserve & surplus.

Details of Deferred Tax Liabilities (Rs in Lacs)

AS – 28– Impairment of Assets

The carrying value of fixed assets is evaluated whenever events or changes in circumstances indicatethat the carrying amounts may not be recoverable. There is no impairment loss recognized or identifiedduring the reporting period.

AS – 29– Provisions, Contingent Liabilities and Contingent Assets

Contingent liabilities are not provided for but are disclosed after a careful evaluation of facts and legalaspects of the matter involved. In general, liabilities and contingencies are provided for it. If, in theopinion and at the discretion of the management, there are reasonable prospects of such liabilitiescrystallizing or future outcome of such contingencies is likely to be materially detrimental to business.

Disclosure required under companies Act, 1956

1. Figures of previous year have been regrouped / rearranged wherever necessary.2. Directors Remuneration


31

Particulars Current Year Rs. Previous Year Rs.Payment To AuditorsFor Audit Fees 45,000/- 45,000/-For Other Charges Nil NilFor Service Tax 5,562/- 5,567/-

Particulars Current Year Rs. Previous Year Rs.Foreign Exchange Earnings Nil NilForeign Exchange Outgo Nil Nil

For, BAHETI BHADADA & ASSOCIATESChartered Accountants

(B. K. BAHETI)Partner

Firm Reg.no. 100865W

For, AND ON BEHALF OF THE BOARD

(Ravindra Jain)Director

(Harsh Jain)Director


Place : AhmedabadDate : 08/05/2013

Place : AhmedabadDate : 08/05/2013

Significant Accounting Policy Signatures to Notes to 22

As per our separate report of even date attached.


CITIZEN INFOLINE LIMITEDCash flow Statement for Year Ended on 31 March 2012

Particulars

A Cash flow From Operating Activities

Net Profit/(Loss) After Tax and Adjustments 2,829,221 3,124,863Add:Depreciation Provision 2,057,117 1,859,051Miscellaneous Expense Written off 1,212,367 3,741,666Financial Expenses 733,409 324,081Profit/Loss On sale of Assets 92,707 29,179Profit on sale of Investment - (1,80,000)Dividend Income - 375Bad Debts W/off - -Short/excess Provision of Taxes - 4,095,600 - 5,773,602

Operating Profit Before Working Capital changes(Increase) / Decrease in Inventories 312,700 (744,100)(Increase) / Decrease in Debtors 282,426 1,092,330(Increase) / Decrease in Loans & Advances 4,810,209 (13,498,678)Increase / (Decrease) in Current Liabilities 1,812,841 6,027,924 (742,030) (12,408,418)Cash Flow from Operations Before Tax 896,897 (3,509,953)Less:

Tax Paid (843,817) 601,899Cash Flow from Operations (A) 53,080 (4,111,852)

B Cash Flow From Investing Activities

Sale of Investments 2,500,000 (5,579,000)Dividend income - 375Purchase of Fixed Assets 1,609,345 3,612,475

4,109,345 1,966,900Sale of Fixed Assets (1,788,327) (700,000)

2,321,018 2,666,900 2,666,900Cash flow From investment Activities (B) 2,321,018 2,600,900

C Cash Flow From Financing ActivitiesIncrease/ (Decrease) In Secured loans 19,94,657Good Will 2,275,155 -Increase/ (Decrease) In Paid up capital 600,000 2,875,155 - 19,94,657

Financial Expenses (733,409) (324,081)Cash flow From Financing Activities(C) (2,141,746) 1,670,576Total Cash Flow of year 126,192 225,624Add: Opening Balance of Cash & Cash Equivelent 758,430 758,430 22,103,631 532,806

Closing Balance of Cash & Equivelent 758,430 632,238 22,103,631 758,430

For31/03/2012

For31-March-12

For31-March-11

For31-March-11


For and on behalf of the Board

(Ravindrar Jain)

Director

(Harsh Jain)

Director


PLACE : AHMEDABADDATE : 08/05/2013

As per our report of even date

PLACE : AHMEDABADDATE : 08/05/2013

B.K.Baheti(Partner)

Firm Reg No. 100865W

32


CITIZEN INFOLINE LIMITEDPROXY FROM

I / WE_______________________________________________________________________________________of_________________________________________________________________________________________being Member / Members of CITIZEN INFOLINE LIMITED hereby appoint ____________________________of ________________________________________________________________________________________________________________________________as my/our proxy in my/our absence to attend andvote for me/us, and on me/our behalf at the 19th Annual General Meting of the Company to be held onMonday the 17th June 2013 at 12:00 Noon at. 411 Sakar-ll, Ashram Road, Ahmedabad. or anyadjournment there of

Signed this ______________________________ Day of ______________________________2012Signature of Proxy/s ___________________________for OFFICE USE ONLYProxy No. ___________________________________Follion No. ___________________________________No. of Shares _________________________________Note : a) The from should be signed across the stamp as per speciman signature.

b) The proxy form duly completed must be deposited at the Registered Office of the Company within notless than 48 Hours before the time fixed for holding the aforesaid meeting.

Rs. 1/-

Revenue

Stamp

Signature

CITIZEN INFOLINE LIMITEDRegd. Off.: 411, Sakar-ll, Ellisbridge, Ashram Road, Ahmedabad - 380 006.

(Attendance Slip to be filed in and handed over at the entrance of the meeting ha|l)

Full name to the attending member. ________________________________________________________________

Regd. Folio No. ________________________________________

No. Shares held ________________________________________

Full name of proxy/s (in BLOCK LETTERS) ______________________________________________________

I hereby record my presence at the 19th ANNUAL GENERAL MEETING HELD on Monday the 17th June 2013at 12:00 Noon at. 411, Sakar II, Ashram Road, Ahmedabad.

Signature of the Member (s) Proxy / proxies Present


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