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GUJARAT NRE COKE LIMITED

Corporate Information

BOARD OF DIRECTORS(As on 14th August, 2014)

Mr. Girdharilal Jagatramka Chairman Emeritus

Mr. Arun Kumar Jagatramka Chairman & Managing Director

Mrs. Mona Jagatramka Director

Mr. Mr. Gopal Prasad Dokania Director

Mr. Mr. Sisir Kumar Mukherjee Director

Dr. Mahendra Kumar Loyalka Director

Mr. Sananguly Murari Director

Mr. C. Narasimhan Nominee Director

CHIEF FINANCIAL OFFICER

Mr. P. R. Kannan

CHIEF COMMERCIAL OFFICER

Mr. Pawan Kumar Agrawal

CHIEF OPERATING OFFICER

Mr. Sunil Kumar Maskara

AUDITORS

M/s. N. C. Banerjee & Co.Chartered Accountants,2, Ganesh Chandra Avenue,Room No. 9, 1st Floor,Kolkata - 700 013

SOLICITORS & ADVOCATES

M/s. L. P. Tiwari & Co.Emerald House, 4th Floor,1B, Old Post Office Street,Kolkata - 700 001

BANKERS

State Bank of India IDBI Bank LtdBank of Baroda Corporation BankState Bank of Hyderabad State Bank of PatialaStandard Chartered Bank State Bank of TravancoreAxis Bank Ltd Export-Import Bank of IndiaICICI Bank Ltd Lakshmi Vilas Bank LtdTamilnad Mercantile Bank Ltd Syndicate BankDBS Bank Ltd United Bank of India

REGISTERED OFFICE22, Camac Street,Block - C, 5th Floor,Kolkata - 700016, IndiaPhone : +91-33-22891471Fax : +91-33-22891470Email : [email protected] : www.gujaratnre.comCorporate Identification Number (CIN) : L51909WB1986PLC040098

WORKSCOKE1) Village Dharampur, Khambhalia,

Devbhoomi Dwarka, Gujarat, India2) Village Lunva, Bhachau,

Kutch, Gujarat, India3) Road No. 16, 1st Cross, KIADB,

Belur Industrial Area, Dharwad,Karnataka, India

STEELVillage Lunva, Bhachau,Kutch, Gujarat, India

REGISTRAR & SHARE TRANSFER AGENTM/s. Niche Technologies (P) Ltd.D-511, Bagri Market, 5th Floor,71, B. R. B. Basu Road, Kolkata - 700 001Phone : +91-33-2235-7270 / 7271Fax : +91-33-2215-6823

Contents

Notice 1 Directors’ Report 12 Report on Corporate Governance 18 Auditors’ Certificate on

Corporate Governance 28 Management Discussion & Analysis 29 Managing Director (CEO) and

Chief Financial Officer (CFO) Certification 31 Independent Auditors’ Report on Abridged Financial

Statements 31 Independent Auditors’ Report 32 Abridged Balance Sheet 34 Abridged Statement

of Profit & Loss 35 Notes to Abridged Financial Statements 36 Cash Flow Statement 42 Statement

under Section 212 relating to Subsidiary Companies 43 Particulars of Subsidiary Companies 44Independent Auditors’ Report on Abridged Consolidated Financial Statements 44 Independent

Auditors’ Report on Consolidated Financial Statements 45 Abridged Consolidated Balance Sheet

46 Abridged Consolidated Statement of Profit & Loss 47 Notes to Abridged Consolidated Financial

Statements 48 Consolidated Cash Flow Statement 57 Proxy Form 59

The Ministry of Corporate Affairs has taken a “Green Initiative in

Corporate Governance” allowing paperless compliances by

Companies for serving of notice/documents/annual reports by

email to the members. To support this initiative in full measure,

members who have not registered their email address so far, are

requested to register their email address, in respect of electronic

holdings with their concerned Depository Participants

immediately. Members who hold shares in physical segment are

also requested to immediately register their email address with

Registrar & Share Transfer Agent of the Company.Life Insurance Corporation of India

1

Notice


TO

THE SHAREHOLDERS,

Notice is hereby given that the 27th Annual General Meeting of the Shareholders (including Shareholders holding “B” Equity Shares) of GUJARAT NRE COKE LIMITED will be held on Tuesday, the

30th day of September, 2014 at 10:30 am at Vidya Mandir, 1

Moira Street, Kolkata 700017 to transact the following business:

Ordinary Business:

1. To receive, consider and adopt the Audited Balance Sheet of the Company as at 31st March, 2014 and the Audited Statement of Profit & Loss for the financial year ended on that date together with the Reports of the Directors' and Auditors' thereon.

2. To consider and if thought fit, to pass, with or without modification, the following resolution as an Ordinary Resolution:

“RESOLVED THAT Dr Mahendra Kumar Loyalka (DIN - 00202976) who retires by rotation at this Annual General Meeting, does not seek his re-appointment and such vacancy shall not be filled up.”

3. To appoint Auditors and to fix their remuneration. In this connection, to consider and if thought fit, to pass, with or without modification, the following resolution as an Ordinary Resolution:

“RESOLVED THAT M/s. N. C. Banerjee & Co., Chartered Accountants, (Registration No. 302081E) be and are hereby re-appointed as the Statutory Auditors of the Company, to hold office from the conclusion of this Annual General Meeting until the conclusion of next Annual General Meeting at such remuneration as may be determined by the Board of Directors in consultation with the Auditors.”

Special Business :


“RESOLVED THAT pursuant to the provisions of Section 149, 152 and Schedule IV of the Companies Act 2013, read with the Companies (Appointment and Qualification of Directors) Rules 2014 (including any statutory modification(s) or re-enactment thereof for the time being in force) and Clause 49 of the Listing Agreement, Mr Sisir Kumar Mukherjee (DIN 03054675), who was appointed by the Board under the provisions of Section 161(4) of the Companies Act 2013 in the casual vacancy caused by the resignation of Dr Basudeb Sen and whose term expires at this Annual General Meeting, and in respect of whom the Company has received a notice in writing from a member proposing his candidature for the office of director, be and is hereby appointed as an Independent Director of the Company to hold office for 5(five) consecutive years with effect from 1st October, 2014 and whose office shall not be liable to determination by retirement of directors by rotation.”


“RESOLVED THAT pursuant to the provisions of Section 149, 152 and Schedule IV of the Companies Act 2013, read

with the Companies (Appointment and Qualification of Directors) Rules 2014 (including any statutory modification(s) or re-enactment thereof for the time being in force) and Clause 49 of the Listing Agreement, Mr Sananguly Murari, (DIN 00573083), existing Non-Executive Director of the Company whose period of office was liable to determination by retirement of directors by rotation and in respect of whom the Company has received a notice in writing from a member proposing his candidature for the office of director, be and is hereby appointed as an Independent Director of the Company to hold office for 5(five) consecutive years with effect from 1st October, 2014 and whose office shall not be liable to determination by retirement of directors by rotation.”

6. To consider and if thought fit, to pass with or without modification, the following resolution as an Ordinary Resolution:

“RESOLVED THAT pursuant to the provisions of Section 149, 152 and Schedule IV of the Companies Act 2013, read with the Companies (Appointment and Qualification of Directors) Rules 2014 (including any statutory modification(s) or re-enactment thereof for the time being in force) and Clause 49 of the Listing Agreement, Mr Gopal Prasad Dokania, (DIN 03267986), who was appointed by the Board as an Additional Director on 30th June, 2014 pursuant to Section 161(1) of the Companies Act, 2013 and Articles of Association of the Company and who holds office up to the date of this Annual General Meeting and in respect of whom the Company has received a notice in writing from a member proposing his candidature for the office of director, be and is hereby appointed as an Independent Director of the Company to hold office for 5(five) consecutive years with effect from 1st October, 2014 and whose office shall not be liable to determination by retirement of directors by rotation.”


“RESOLVED THAT pursuant to the provisions of Section 148 and all other applicable provisions of the Companies Act 2013 and the Companies (Audit and Auditors) Rules 2014 [including any statutory modification(s) or re-enactment thereof for the time being in force], the remuneration payable to the cost auditors M/s. B Mondal & Associates, Cost Accountants, appointed by the Board of Directors of the Company, to conduct the audit of cost records of the Company for the financial year 2014-15, being Rs. 75,000/- plus applicable taxes and out of pocket expenses be and is hereby ratified and confirmed.”

“RESOLVED FURTHER THAT the Board of Directors of the Company (including any Committee of the Board) be and is hereby authorised to do all acts and take all steps as may be necessary, proper or expedient to give effect to this resolution.”

8. To consider and if thought fit, to pass, with or without modification, the following resolution as a Special Resolution:

“RESOLVED THAT pursuant to the provisions of Sections 196, 197, 203 and any other applicable provisions of the Companies Act 2013 read with Companies (Appointment

2


and Remuneration of Managerial Personnel) Rules 2014 and Schedule V of the Companies Act 2013 (including any statutory modification(s) or re-enactment thereof for the time being in force) and in partial modification of Resolution passed at the Annual General Meeting of the company held on 30th September 2011 the consent of the Company be and is hereby accorded to payment of remuneration as set out in the Explanatory Statement herein to Mr Arun Kumar Jagatramka during his remaining tenure commencing from 1st April 2014 to 27th March 2017 as Chairman & Managing Director of the Company, in the event the company has no profits or its profits are inadequate in any financial year during such remaining period.”

“RESOLVED FURTHER THAT the Board of Directors of the Company (including any Committee of the Board) be and is hereby authorized to take all such steps as may be necessary, proper or expedient to give effect to the above stated resolution.”


“RESOLVED THAT pursuant to the provisions of Section 186 of the Companies Act 2013 including any statutory modification or re-enactment thereof for the time being in force, the consent of the company be and is hereby given to the Board of Directors (hereinafter referred to as “the Board”, which term shall be deemed to include any Committee of Directors for the time being authorized by the Board of Directors) to make loans and/or give guarantee(s)/provide security(ies) in connection with any loans made or to make investments in shares and / or other securities of body corporates, whether Indian or overseas in excess of 60% of paid up capital and free reserves of the company or 100% of free reserves of the company, whichever is more and also in excess of Rs.6,395,00,00,000/- (Rupees Six Thousand three Hundred Ninety-five crore only) as approved by the shareholders vide special resolution passed through postal ballot as per its results declared on 17th April 2014 (hereinafter referred to as “the prescribed limits”) notwithstanding that the aggregate of investments made, loans made, guarantees given and securities provided may exceed the prescribed limits by a sum not exceeding Rs.20,00,000/- (Rupees Twenty lacs only) provided however that the total of all such investments and loans made, guarantees given and securities provided by the Company at any point of time shall not exceed in the aggregate of a sum of Rs.6,395,20,00,000/- (Rupees Six thousand, three hundred and ninety five crores and twenty lacs only).”

“RESOLVED FURTHER THAT the Board be and is hereby authorised to do and perform all such acts, deeds, matters and things, as well as to sign and execute such papers, documents, deeds and instruments as may be deemed necessary for the purpose as aforesaid.”


“RESOLVED THAT pursuant to the provisions of Section 42, 62 and all other applicable provisions, if any, of the Companies Act, 2013 (including any statutory modificationsor re-enactment thereof for the time being in force),

provisions of the Memorandum and Articles of Association of the Company, and subject to rules/regulations/guidelines issued by the Securities & Exchange Board of India (hereinafter referred to as “SEBI”), the Stock Exchange(s) where the shares of the Company are listed (including provisions of the listing agreement with them), or any other appropriate/statutory authority and also subject to such approvals, permissions, sanctions and consents as may be necessary and required from the Government of India, the Reserve Bank of India (hereinafter referred to as “RBI”), and all other appropriate authorities and institutions, and subject further to such other terms, conditions, stipulations, alterations, amendments, modifications or variations, the consent and approval of the members of the Company be and is hereby accorded to the Board of Directors, (hereinafter referred to as “the Board”, which term shall be deemed to include any Committee of Directors for the time being authorized by the Board of Directors) to offer, issue and allot in one or more tranches, on private placement and/or preferential basis, Convertible Warrants not exceeding 2,90,00,000 (two crore ninety lacs) with each warrant carrying an option/entitlement to subscribe to one number of Equity Share of Rs. 10/- each of the Company, in exchange ofeach such warrant on a future date i.e entitlement to subscribe to a maximum of 2,90,00,000 Equity Shares of Rs.10/- each (in aggregate), within a period not exceeding 18 (eighteen) months from the date of issue of such warrants, to the following entity(ies) :

Sr. Name of the Category Maximum Number No. Proposed Allottee of Warrants

to be allotted

1. Dharwad Traders Pvt Ltd Promoter 1,50,00,000

2. Lunva Traders Pvt Ltd Promoter 1,00,00,000

3. Bennett Coleman & Co Ltd Non-Promoter 40,00,000

Total 2,90,00,000

“RESOLVED FURTHER THAT the offer, issue and allotment of the aforesaid warrants and the Equity Shares resulting from the exercise of the entitlement of the warrant holders to subscribe to the Equity Shares shall be made at such time(s) as the Board may in its absolute discretion decide, subject however, to applicable guidelines, notifications, rules and regulations and the terms and conditions given herein below:

a) The price including premium of the equity share to be allotted on exchange/ surrender of the said warrant shall not be lower than the minimum price specified as per SEBI Regulations for Preferential Issues [Chapter VII of SEBI (Issue of Capital and Disclosure Requirements) Regulations, 2009], considering 28th August 2014 as the Relevant Date, with authority to the Board to finalize the price.

b) Each of the said Warrant shall have face value of such sum that will be equivalent to the 25% of the price of the equity share to be issued in exchange/surrender of such warrant in terms of this resolution and SEBI Regulations for Preferential Issues and will be paid as up-front at the time of allotment of warrants.

c) Each of the said warrant shall carry a right, entitling its registered owner to apply for at his option and seek allotment of one Equity share of Rs.10/- each upon exchanging/surrendering of the warrant to the Company

Notice (contd.)

3


along with balance 75 % of the issue price of the Equity Share.

d) Against each of the said warrant, the registered owner of the warrant shall be entitled to apply for at his option, and seek allotment of one Equity share in the manner aforesaid, within the period not exceeding 18 months from the date of issue of the said warrants and the Board of Directors of the Company at its discretion shall decide the time within which the application for equity share against exchange/surrender of the said warrant shall be made subject to the time limit of 18 months.

e) In case the warrant holder do not apply for the shares of the Company against exchange/surrender of the said warrant as aforesaid within the time that may be fixed by the Board of Directors in this regard, then the amount paid up on each of the said warrant shall be forfeited and all the rights attached to the said warrant shall lapse automatically.

f) Upon exchange/surrender of each of the said warrant, the amount paid up thereon shall be credited, adjusted and applied towards share application money, for which the holder of the warrant is entitled to apply.

g) The Equity Shares to be offered, issued and allotted as aforesaid against exchange/surrender of the said warrant upon exercise of the option by the warrant holder, shall be subject to the provisions of the Memorandum and Articles of Association of the Company and on allotment, such Equity Shares shall rank pari-passu with the existing Equity Shares of the Company in all respect.

h) Each of the said warrants and the Equity Shares to be offered, issued and allotted as aforesaid, upon exchange/surrender of the said warrants by the holder thereof, as also the entire pre-preferential Equity Shares held, if any, by the proposed allottees, shall be subject to lock in for such period as may be prescribed under the SEBI Regulations for Preferential Issues.

i) The warrant by itself shall not give to the holder thereof any rights of the shareholders of the Company.

j) The option attached to each of the said warrants shall be independent of each other.

k) In case the Equity Shares of the Company are either subdivided or consolidated before issues of the aforesaid warrants, or before the exercise of option by the holders of the said warrants, then the face value, the number of Equity Shares to be acquired upon exercise of the option attached to the said warrants and the price of acquisition of the said Equity Shares by the holders of the warrants, shall automatically stand augmented/ reduced in the same proportion, as the present value of the Equity Shares of Rs.10/- each of the Company bears to the newly sub-divided or consolidated Equity Shares, without affecting any right or obligation of the said warrant holders.”

”RESOLVED FURTHER THAT to give effect to the aforesaid resolutions, the Board be and is hereby authorized to delegate all or any of the powers herein conferred to any Committee of Directors or any Director or any other officer(s) of the Company and for the purpose of giving effect to this resolution, the Board acting on its own or through a Committee of Directors or any other person duly authorized in this regard by the Board/Committee, be and is hereby authorized to do all such acts, deeds, matters and things as may be deemed necessary and settle any or all questions/matters arising with respect to the offer, issue and allotment (including deciding the terms and conditions for the same), utilization of the proceeds of the issue of the warrants/shares, execute all such deeds, documents, agreements and writings as may be necessary for the purpose of giving effect to the aforesaid resolution, take such further steps as are required for allotment and listing on one or more Stock Exchange(s), to take such other steps that are incidental and ancillary in this regard; and to do, make or accept such alterations, modifications or variations in the foregoing or cancellation of issue of warrants, as may be c o n s i d e r e d d e s i r a b l e o r e x p e d i e n t b y t h e Board/Committee/such Authorised Person in the best interest of the Company and its shareholders.”


“RESOLVED THAT pursuant to the Issue of Foreign Currency Convertible Bonds and Ordinary Shares (through Depository Receipt Mechanism) Scheme, 1993, as amended, and such other rules and regulations, circulars, clarifications, press notes may be issued by the Reserve Bank of India (“RBI”) or the Ministry of Finance, Government of India (“MoF”) or any statutory authority from time to time, consent of the members be and is hereby accorded to the Board of Directors of the Company to reset the conversion price according to the disclosure given under the following resolution, of 5.5% Unsecured Foreign Currency Convertible Bonds (FCCB) due 2017 aggregating to USD 20 million issued by the Company and amend the terms and conditions of the FCCB and Trust Deed dated October 29, 2012 between the Company and the Bank of New York Mellon, London Branch, the trustees for the Bondholders”

“RESOLVED FURTHER THAT the reset conversion price of the FCCB shall not be less than average of the weekly high and low of the closing price of the equity shares of the Company quoted on BSE or NSE, where there is higher volume, during the two weeks preceding the date of the meeting of the Board of Directors (hereinafter referred to as “the Board”, which term shall be deemed to include any committee of the directors for the time being authorized by the Board of Directors) of the Company held on 14th August, 2014 decides to reset conversion price of the FCCB, and accordingly the reset conversion price of the FCCB shall be Rs. 12.00 per equity share”

“RESOLVED FURTHER THAT the Board be and is hereby, authorised to make application as applicable to the RBI, MoF or any statutory authority with the reset conversion price for their approval and to do all such acts, deeds and matters as

Notice (contd.)

4


necessary to procure the approval as applicable of the RBI, MoF or any statutory authority for reset conversion price of the FCCB and filing of the necessary documents etc. in relation to the same”

“RESOLVED FURTHER THAT subject to applicable laws, guidelines, circulars, notifications, press notes for the purpose of giving effect to the aforesaid resolution, the Board be and is hereby authorised on behalf of the Company to do all such acts, deeds, matters and things and authorise signing and execution of deeds, documents, letters and such other papers, as may be necessary or desirable with power on behalf of the Company to settle any questions, difficulties or doubts that may arise in this regard without requiring the Board of Directors to secure any further consent or approval of the members of the Company.”

By Order of the Board

For GUJARAT NRE COKE LIMITED

Place : Wollongong Arun Kumar JagatramkaDated : 14th August, 2014 Chairman & Managing Director

NOTES:

1. A SHAREHOLDER (INCLUDING SHAREHOLDER HOLDING “B” EQUITY SHARE) ENTITLED TO ATTEND AND VOTE AT THE MEETING IS ENTITLED TO APPOINT A PROXY TO ATTEND AND VOTE INSTEAD OF HIMSELF/ HERSELF AND A PROXY NEED NOT BE A MEMBER OF THE COMPANY. THE INSTRUMENT APPOINTING THE PROXY SHOULD, HOWEVER, BE DEPOSITED AT THE REGISTERED OFFICE OF THE COMPANY NOT LESS THAN FORTY EIGHT HOURS BEFORE THE COMMENCEMENT OF THE MEETING.

A person can act as a proxy on behalf of the members not exceeding fifty and holding in the aggregate not more than ten percent of the total share capital of the Company carrying voting rights. A member holding more than ten precent of the total share capital of the Company carrying voting rights may appoint a single person as proxy and such person shall not act as a proxy for any other person or shareholder.

2. The explanatory statement pursuant to the provisions of Section 102 of the Companies Act, 2013 relating to the Special Business at the meeting, is annexed hereto.

3. The Register of Members and the Share Transfer Books of the Company for Equity Shares (including “B” Equity Shares) will remain closed from Monday, the 18th day of August 2014 to Friday, the 22nd day of August, 2014 (both days inclusive).

4. Shareholders desiring any information on the accounts for the year ended 31st March, 2014 are requested to write to the Company at least ten days in advance, so as to enable the management to keep the information ready at the meeting.

5. Electronic copy of the Annual Report for 2013-14 and copy of the notice of the 27th Annual General Meeting of the Company inter alia indicating the process and manner of e-voting along with Attendance Slip and Proxy Form is being sent electronically to all members whose email ids are registered with the depository part icipants for

communication purposes unless any member has requested for hard copy of the same. For members who have not registered their email address, physical copies of the Annual Report for 2013-14 along with notice is being sent in the permitted mode.

6. Shareholders are requested to bring the admission slip(s) along with their copy of Annual Report to the meeting.

7. Pursuant to the provisions of Section 205A(5) and 205C of the Companies Act, 1956, the Company has transferred the unclaimed/ un-encashed dividends for the financial years up to 2004-06 from time to time on due dates, to “The Investor Education & Protection Fund” (IEPF) established by the Central Government. Please note that dividend for the financial year 2006-07 which remains unclaimed / un-encashed would be transferred to the IEPF within stipulated period during October/November 2014. It may please be noted that once the unclaimed / un-encashed dividend is transferred to “The Investor Education & Protection Fund”, as aforesaid, no claim shall lie in respect of such amount by the shareholder.

Hence, the shareholders who have not encashed their dividend warrants for the abovementioned dividend and /or dividends declared thereafter are requested to immediately forward the same to the Company for revalidation or seek issue of duplicate warrant(s) by writing to the Company's Registrar & Share Transfer Agent.

8. Members are requested to update their email id with respective Depository Participant in case they hold shares in electronic mode or to write to the Share Department of the company/Registrar & Share Transfer Agent in case they hold shares in Physical form.

9. Shareholders of the Company has approved issue of 6,00,00,000 equity shares on preferential/private placement basis upon rights to be exercised by lending banks under CDR. Pursuant to this, following are the lending banks who can exercise their rights : - State Bank of India, State Bank of Hyderabad, Bank of Baroda, Axis Bank Ltd, ICICI Bank Ltd, Tamilnad Mercantile Bank Ltd, IDBI Bank Ltd, Life Insurance Corporation of India, Corporation Bank, State Bank of Patiala, State Bank of Travancore, Export-Import Bank of India, Lakshmi Vilas Bank Ltd, Syndicate Bank and United Bank of India.

10. Shareholders desirous of having a complete text of Annual Report 2013-14 may write to us at [email protected] or at the Registered Office of the Company

11. VOTING THROUGH ELECTRONIC MEANS

I. In compliance with provisions of Section 108 of the Companies Act, 2013 read with Rule 20 of the Companies (Management and Administration) Rules, 2014, the Company is pleased to provide its members the facility of voting through electronic means, as an alternate, to enable them to cast their votes electronically and the business may be transacted through e-voting services provided by Central Depository Services (India) Limited (CDSL).

II. Similarly, Members opting to vote physically can do the same by remaining present at the meeting and should not exercise the option for e-voting. However, in case

Notice (contd.)

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Members cast their vote exercising both the options, i.e. physically and e-voting, then votes casted through e-voting shall only be taken into consideration and treated valid whereas votes casted physically at the meeting shall be treated as invalid. The instructions for e-voting are as under, Members are requested to follow the instruction below to cast their vote through e-voting:

III. The instructions for shareholders voting electronically are as under:

(i) The voting period begins on 24th September, 2014 at 10.00 a.m. and ends on 26th September, 2014 at 6.00 p.m. During this period shareholders of the Company, holding shares either in physical form or in dematerialized form, as on the cut-off date of 16th August, 2014, may cast their vote electronically. The e-voting module shall be disabled by CDSL for voting thereafter.

(ii) Log on to the e-voting website www.evotingindia.com

(iii) Click on “Shareholders” tab.

(iv) Now Enter your User ID

a. For CDSL: 16 digits beneficiary ID,

b. For NSDL: 8 Character DP ID followed by 8 Digits Client ID,

c. Members holding shares in Physical Form should enter Folio Number registered with the Company, excluding the special characters.

(v) Next enter the Image Verification as displayed and Click on Login.

(vi) If you are holding shares in demat form and had logged on to www.evotingindia.com and voted on an earlier voting of any company, then your existing password is to be used.

(vii) If you are a first time user follow the steps given below:

For Members holding shares in Demat Form and Physical Form

PAN Enter your 10 digit alpha-numeric *PAN issued by Income Tax Department (Applicable for both demat shareholders as well as physical shareholders)

� Members who have not updated their PAN with the Company / Depository Participant are requested to enter in capital letters the PAN field of 10 characters as First 2 Characters of the First Holder Name followed by 8 characters consisting of Folio Number prefix by “0” (or 8 characters from right of BO-ID). No special characters or space will be taken from the name and folio number and name shall be excluded of titles like Mr / Mrs / Smt / Miss / Ms / M/s etc.

Example :

(1) Mr. V. N. Swami and Folio Number is S/0245, the PAN will be VN000S0245

(2) M/s. 4-Square Company Ltd. and Folio Number is C-0052 the PAN will be 4S000C0052

DOB Enter the Date of Birth as recorded in your demat account with the depository or in the company records for your folio in dd/mm/yyyy format.

Dividend Enter the Bank Account Number as recorded in your demat account with the depository or in the company records forBank Details your folio.

� Please Enter the DOB or Bank Account Number in order to Login.

� If both the details are not recorded with the depository or company then please enter in the Dividend Bank Details field the Number of Shares Held by you as on Cut-Off Date (Record Date) of 16.08.2014.

(viii) After entering these details appropriately, click on “SUBMIT” tab.

(ix) Members holding shares in physical form will then directly reach the Company selection screen. However, members holding shares in demat form will now reach 'Password Creation' menu wherein they are required to mandatorily enter their login password in the new password field. Kindly note that this password is to be also used by the demat holders for voting for resolutions of any other company on which they are eligible to vote, provided that company opts for e-voting through CDSL platform. It is strongly recommended not to share your password with any other person and take utmost care to keep your password confidential.

(x) For Members holding shares in physical form, the details can be used only for e-voting on the resolutions contained in this Notice.

(xi) Click on the EVSN of “GUJARAT NRE COKE LIMITED” on which you choose to vote.

(xii) On the voting page, you will see “RESOLUTION DESCRIPTION” and against the same the option

“YES/NO” for voting. Select the option YES or NO as desired. The option YES implies that you assent to the Resolution and option NO implies that you dissent to the Resolution.

(xiii) Click on the “RESOLUTIONS FILE LINK” if you wish to view the entire Resolution details.

(xiv) After selecting the resolution you have decided to vote on, click on “SUBMIT”. A confirmation box will be displayed. If you wish to confirm your vote, click on “OK”, else to change your vote, click on “CANCEL” and accordingly modify your vote.

(xv) Once you “CONFIRM” your vote on the resolution, you will not be allowed to modify your vote.

(xvi) You can also take out print of the voting done by you by clicking on “Click here to print” option on the Voting page.

(xvii) If Demat account holder has forgotten the same password then Enter the User ID and the image verification code and click on Forgot Password & enter the details as prompted by the system.

(xviii) Note for Institutional Shareholders� Institutional shareholders (i.e. other than

Notice (contd.)

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Individuals, HUF, NRI etc.) are required to log on to https://www.evotingindia.co.in and register themselves as Corporates.

� A scanned copy of the Registration Form bearing the stamp and sign of the entity should be emailed to [email protected].

� After receiving the login details they have to create a compliance user should be created using the admin login and password. The Compliance user would be able to link the account(s) for which they wish to vote on.

� The list of accounts should be mailed [email protected] and on approvalof the accounts they would be able to cast their vote.

� A scanned copy of the Board Resolution and Power of Attorney (POA) which they have issued in favour of the Custodian, if any, should be uploaded in PDF format in the system for the scrutinizer to verify the same.

(xix) In case you have any queries or issues regardinge-voting, you may refer the Frequently Asked Questions (“FAQs”) and e-voting manual available at www.evotingindia.co.in under help section or write an email to helpdesk.evoting@cdslindia. com.

12. Institutional Members / Bodies Corporate (i.e. other than individuals, HUF, NRI etc.) are required to send scanned copy (PDF/JPG Format) of the relevant Board Resolution / Authority letter etc. together with attested specimen signature of the duly authorized signatory(ies) who are authorized to vote through e-mail at skghosh_1938@yahoo. co.in with a copy marked to helpdesk.evoting@cdslindia. com on or before 26th September 2014, upto 6 pm. without which the vote shall not be treated as valid.

13. The voting rights of shareholders shall be in proportion to their shares of the paid up equity share capital of the Company ason the cut-off date (record date) of 16th August, 2014.

14. Shareholders holding Equity shares shall have one vote for every equity share held by them as on the cut-off date (record date) of 16th August, 2014 and shareholders holding “B” Equity Shares shall have one vote for every 100 (one hundred) “B” Equity Shares held by them as on the cut-off date (record date) of 16th August, 2014. Fractions, if any, in voting right is to be ignored as per the provisions of Article no 78A of the Articles of Association of the Company and in terms of issue of “B” Equity shares

15. The Company has appointed Mr. S. K. Ghosh, Practicing Company Secretary as the Scrutinizer for conducting the e-voting process in a fair and transparent manner. The Scrutinizer shall, within a period not exceeding three (3) working days from the conclusion of the e-voting period, unblock the votes in the presence of at least two (2) witnesses not in employment of the Company and make a Scrutinizer's Report of the votes cast in favour or against, if any, forthwith to the Chairman of the meeting.

16. The results of e-voting and poll, if any, shall be aggregated and declared on or after the AGM of the Company by the Chairman or by any other person duly authorized in this regard. The results declared along with the Scrutinizer's Report shall be placed on the Company's website www.gujaratnre.com and on the website of CDSL within two (2)days of passing of the resolution at the AGM of the Company and communicated to BSE Limited and National Stock Exchange of India Limited where the equity shares of the Company are listed.

17. The documents mentioned in Notice and Explanatory Statement are open for inspection by the shareholders at the Registered Office of the Company on all working days between 12 noon and 2 pm upto the date of the AGM.

Item No. 4, 5 & 6

In accordance with the relevant provisions of the Articles ofAssociation of the Company and the erstwhile provisions of theCompanies Act, 1956, Mr Sananguly Murari, Non-ExecutiveDirector was appointed by the Members of the Company.Further, Mr Sisir Kumar Mukherjee was appointed by the Boardof Directors in casual vacancy caused by the resignation of DrBasudeb Sen. Mr Gopal Prasad Dokania was appointed as anadditional director by the Board of Directors.

The provisions of the Companies Act, 2013 with respect to appointment and tenure of the Independent Directors have come into effect. Accordingly, in compliance of Section 149 and 152 read with Schedule IV and any other applicable provisions of the Companies Act, 2013 and Clause 49 of the Listing Agreement, Mr Sisir Kumar Mukherjee, Mr Sananguly Murari and Mr Gopal Prasad Dokania, being eligible and offering themselves for appointment, are proposed to be appointed as Independent Directors of the Company who shall hold office for a period of 5 years from 1st October 2014. Mr Sisir Kumar Mukherjee, Mr Sananguly Murari and Mr Gopal Prasad Dokania have consented to be appointed as Independent Directors and submitted requisite declarations as to their satisfying the criteria of independence as stipulated under Section 149 (6) of the Companies Act, 2013 and provisions of Clause 49 of the Listing Agreement. Your Board is of the opinion that Mr Sisir Kumar Mukherjee, Mr Sananguly Murari and Mr Gopal Prasad Dokania are persons of integrity and possesses relevant expertise and experience and fulfills the other criteria of independence as per Section 149(6) of the Act and the

listing agreement.

The Company has received requisite notices from the members under Section 160 of the Act along with the deposit of requisiteamount as required under the aforesaid section proposing the candidature of Mr Sisir Kumar Mukhejee, Mr Sananguly Murari andMr Gopal Prasad Dokania for the office of Director of the Company.

About Mr Sisir Kumar Mukherjee

Mr Sisir Kumar Mukherjee was appointed as a Director under the provisions of Section 161(4) of the Companies Act 2013 in the casual vacancy caused by the resignation of Dr Basudeb Sen by the Board of Directors of the Company at a meeting held on 18th March 2014 and his tenure would expire at the ensuing Annual General Meeting.

Mr Sisir Kumar Mukherjee is a B.Com (H) and a Certified Associate of Indian Institute of Bankers, Mumbai. He is a retired Chief General Manager of State Bank of India, Ahmedabad Circle and is a man of extensive experience in banking industry at various levels for over 4 decades. A humanitarian by nature, he is closely associated with an NGO named Speech & Hearing Action Society (SAHAS) based in Durgapur.

About Mr. Sananguly Murari

Mr Sananguly Murari is a B.E. (Mechanical) passed in 1st class in 1965. He has a vast experience in the iron steel industry, having worked at managerial position in large enterprises viz. Durgapur Steel Plant of SAIL and Kudremukh Iron Ore Company Limited. Mr Murari also served as a Director of Coal India Ltd. He has

Explanatory Statement pursuant to Section 102 of the Companies Act, 2013.

Notice (contd.)

7


undergone extensive training programmes conducted under various management programmes in India, USA, Canada and Australia.

About Mr Gopal Prasad Dokania

Mr Gopal Prasad Dokania was appointed as an Additional Director under the provisions of Section 161(1) of the Companies Act 2013 and Articles of Association of the Company at a meeting held on 30th June 2014 and his tenure would expire at the ensuing Annual General Meeting.

Mr Gopal Prasad Dokania, a well known Chartered Accountant in Eastern India, has vast experience of more than 30 years in various fields viz. Taxation, Management Consultancy, Accountancy and Corporate matters with specialization in taxation and merger & acquisition. Mr Gopal Prasad Dokania has served the Institute of Chartered Accountants of India (ICAI) for several years. He is a former Central Council Member of ICAI and former Chairman of Eastern India Regional Council of ICAI.

The Board recommends the resolutions as set out in item nos 4 to 6 in relation to appointment of all the above persons as Independent Directors w.e.f. 1st October, 2014 for your approval.

None of the Directors and Key Managerial Personnel and their relatives, other than Independent Directors for their respective appointment, are concerned or interested, financially or otherwise in these Resolution(s) set out in item nos. 4 to 6.

Item no 7

The Board of Directors, on the recommendation of Audit Committee had approved the reappointment of M/s B Mondal & Associates, Cost Accountants as Cost Auditors of the Company to conduct cost records of the company for the financial year 2014-15 at a remuneration of Rs.75,000/- plus applicable taxes and out of pocket expenses.

In accordance with the provisions of Section 148 of the Companies Act 2013 read with the Companies (Audit and Auditors) Rules 2014, the remuneration payable to the Cost Auditors has to be ratified by the shareholders of the Company. Accordingly, the consent of the members is sought by an ordinary resolution for ratification of the remuneration payable to the Cost Auditors for the financial year 2014-15.

The Board recommends the resolution set out in item no 7 of the notice for your approval.

None of the Directors or Key Managerial Personnel of the Company and/or their relatives are deemed to be concerned or interested, financially or otherwise in this resolution.

Item no 8

Mr Arun Kumar Jagatramka was appointed Chairman & Managing Director by the members of the company at the 24th AGM of the Company on 30th September 2011 for a period of 5 years w.e.f. 28th March, 2012 with authority to the Board/its Committee to vary any such terms and conditions including remuneration subject to the applicable provisions of Companies

Act 1956 read with Schedule XIII to the said Act. His present tenure of office shall expire on 27th March 2017.

In case of sufficient profits in any of the financial years from 1st April, 2014 to 27th March, 2017, the Chairman & Managing Director will continue to receive the remuneration as approved by the shareholders at the Annual General Meeting held on 30th September, 2011.

The present resolution as set out in Item No. 8 is sought to pay minimum remuneration to Mr. Arun Kumar Jagatramka under the provisions of the Companies Act, 2013 in case of no profit or in adequate profit as under :-

Minimum Remuneration

Upto to maximum of Rs. 60,00,000/- per annum plus 0.01% of the effective capital in excess of Rs. 250.00 crores.

Disclosure of information pursuant to Schedule V of the Act in case of payment of Minimum Remuneration

I General Information:

(1) Nature of industry: The Company is engaged in the business of manufacture and sale of Metallurgical Coke and TMT bars.

(2) Date or expected date of commencement of commercial production:

The Company is already in commercial production.

(3) In case of new companies, expected date of commencement of activities as per project approved by financial institutions appearing in the prospectus.

Not applicable.

(4) Financial performance based on given indicators (on standalone basis)

(Rs in crores)

Particulars FY 2013-14 FY 2012-13 FY 2011-12

Gross Revenue 1250.64 1751.94 1400.27

Profit Before Tax (834.40) 46.27 5.53

Profit After Tax (560.81) 30.98 3.09

(5) Foreign investments or collaborators, if any.

The Company has not entered into any foreign collaboration and no foreign direct capital investment has been made in the Company. Foreign investors, mainly comprising FIIs, NRIs/ OCBs are investors in the Company on account of past issuances of securities/secondary market purchases.

II Information about the appointee:

(1) Background details: Mr. Arun Kumar Jagatramaka is a Chartered Accountant with an all India 1st rank and gold medal. He has an industrial experience of more than 15 years in the business of coal and coke besides a prior experience in management consultancy and merchant banking.

(2) Past remuneration (last two years):

Financial Year Salary Perquisite Commission Contribution to PF Total Remarks

2013-14 12,00,000 10,10,172 Nil 1,44,000 23,54,172 Min imum Remunera t i on pa id i naccordance with Schedule XIII of the Companies Act, 1956

2012-13 1,20,00,000 29,94,237 48,89,806 1,44,000 2,00,28,043 As per Service Contract

Notice (contd.)

8


which would meet the expectations of all our stakeholders.

(3) Expected increase in productivity and profits in measurable terms.

Though the coal and met coke Industry is witnessing a continued slowdown, in anticipation of revival of the overall economy in future, the aforesaid steps taken/ to be taken by the Company are expected to improve the Company's performance and profitability.

Mr. Arun Kumar Jagatramka, being appointee and Mrs. Mona Jagatramka, his spouse and their relatives to the extent of their shareholding in the Company are deemed to be concerned or interested, financially or otherwise in this Resolution.

Save and except the above, none of the other Directors and Key Managerial Personnel and their relatives are concerned or interested, financially or otherwise in this Resolution.

Accordingly, the Board of Directors recommends the Resolution as set out in item no 8 for your approval.

Item No 9

The Company had entered into an MOU with Industries Commissioner, Government of Gujarat, Gujarat Mineral Development Corporation Ltd., University of Wollongong, Australia, Indian Institute of Technology, Kharagpur and Pandit Deendayal Petroleum University on 25th October 2013 for setting up Indian Centre of Excellence in Mining, Safety and imparting skill development, demonstration of Technology and best practices, Research and Development, incubation and entrepreneurship in mining, mineral development and facilitating industrial development in Joint Venture with industry and academic participation. The said Centre i.e. Indian Centre of Excellence in Mining Safety and Automation (ICEM) is set up as Section 25 Company under the provisions of Companies Act 1956.

The Government of Gujarat has decided to provide necessary financial assistance to the said Centre. However, the Company in its capacity as Industry partner is required to subscribe for an amount of Rs.20 lakhs out of the total proposed capital of ICEM of Rs.1 crore. As per the provisions of Section 186 of the Companies Act, 2013, the Company is required to seek approval of the shareholders through special resolution for making loans, investments, providing security, etc. in excess of 60% of paid up capital and free reserves of the company or 100% of free reserves of the company, whichever is more. This investment will exceed the authority of the Board to make loans and investment upto Rs. 6395,00,00,000/- (Rupees Six Thousand three Hundred Ninety-five crore only) earlier granted by the shareholders by a resolution through postal ballot passed on 17th April 2014.

The Board recommends the resolution set out in item no 9 of the notice for your approval.


Item No 10

The Board of Directors at its meeting held on 14th August 2014 have decided to issue Convertible Warrants on Private Placement/Preferential basis to the Promoter / Non Promoter Entity(ies) in order to bring funds at an appropriate time to meet the operational requirements of the Company subject however, to the approval of shareholders under the provisions of Section 42 and other applicable provisions of the Companies Act 2013.

(3) Recognition or awards

a. Mr Arun Kumar Jagatramka has earlier served as the Honorary NSW 'Sydney Ambassador' to India, appointed by the Government of New South Wales, Australia

b. He is an active member of prominent Industry associations like CII, FICCI, ASSOCHAM, MCC Chamber of Commerce & Industry, etc.

c. Mr Arun Kumar Jagatramka has been ranked 8th among "India's Most Valuable CEO", (sectorwise ranking) list and 39th in "The Value Ranking" list published by Businessworld, November 2009.

(4) Job profile and his suitability

Being the Chairman & Managing Director, Mr Jagatramka is responsible for the overall functioning and performance of the Company. He is a promoter of the Company and has been associated with the business of coal & coke for the last two decades. Under his guidance, the Company has emerged as one of the largest independent producer of metallurgical coke in India.

(5) Remuneration proposed

As stated above in the explanatory statement

(6) Comparative remuneration profile with respect to industry, size of the company, Profile of the position and person (in case of expatriates the relevant details would be with respect to the country of his origin).

The remuneration of the Chairman & Managing Director is commensurate with the remuneration in the industry and the company of similar size and scale of operations taking into consideration the responsibilities shouldered by him.

(7) Pecuniary relationship directly or indirectly with the company, or relationship with the managerial personnel, if any.

Mr Arun Kumar Jagatramka does not have any pecuniary relationship with the Company or with any managerial personnel.

III. Other information:

(1) Reasons of loss or inadequate profits

The prolonged slowdown in the economic activity world wide, subdued infrastructure activities, tight financing environment with high interest rate continued to impact the performance of the Company. The Company is struggling with high input costs and lower realizations in its products viz. Metallurgical Coke and TMT bars.

(2) Steps taken or proposed to be taken for improvement

The Company has taken various initiatives to regain its leadership, improve market share and financial performance. Very recently, Empowered Group of Corporate Debt Restructuring Cell (CDR) of Reserve Bank of India has given a formal approval for the restructuring debts of the Company. We are confident that with the domestic economy about to accelerate with new vigor and continued support of our lenders, customers and all stakeholders, we would very soon be able to achieve stability and produce tangible results

Notice (contd.)

9


b) Intention of proposed subscribers to subscribe to the Offer :

The names of the proposed subscribers along with the number of warrants that they have intended to subscribe is already provided in the resolution.

c) Undertakings:

The Company hereby undertakes that it shall re-compute the price of the specified securities in terms of the provisions of the said Regulations where it is required to do so. The Company also undertakes that if the amount payable on account of the re-computation of price is not paid within the time stipulated in the said Regulations, the specified securities shall continue to be locked in till the time such amount is paid by the allottee(s).

These Convertible warrants would also be issued as per the provisions of Chapter VII of SEBI (Issue of Capital and Disclosure Requirements) Regulations, 2009, Listing Agreement of Stock Exchange and other applicable laws and provisions. The aforesaid Convertible Warrants, if issued, shall carry a right to its holder to apply for and receive 1(one) Equity Share of the Company of Rs.10 each in lieu of every warrant within 18 months from the date of issue of such warrants. The warrant shall have such face value and shall be subject to such terms and conditions as stated in the special resolution under Item no. 10 of the notice.

The information as required under SEBI (Issue of Capital and Disclosure Requirements) Regulations, 2009 are as under:

a) Objects to the Issue :

To bring funds at an appropriate time to meet the operational requirements of the Company.

d) Shareholding Pattern before and after issue (of Equity Shares resulting from the exercise of options by the warrant holders in respect of the warrants covered under Item no. 10 assuming full conversion of Warrants):

i) Equity Shares of the Company -

Particulars Pre-Allotment Shareholding Post-Allotment Shareholding(As on 8.8.2014) (after conversion of Warrants)

No. of Shares % No. of Shares %

Promoters Holdings -

Indian Promoters 42998354 6.93 42998354 6.62Foreign Promoters – – – –

Sub Total 42998354 6.93 42998354 6.62Promoter Group Entities 251025703 40.45 276025703 42.50

Sub Total 251025703 40.45 276025703 42.50

Total Promoters Holdings (a) 294024057 47.38 319024057 49.12

Non-Promoters Holdings -

Institutional Investors

Mutual Funds & UTI 4887 0.00 4887 0.00Banks, Financial Institutions, Insurance Companies, Government holdings, etc. 15341372 2.47 15341372 2.36Foreign Institutional Investors & Foreign Bodies Corporates 87720060 14.14 87720060 13.50

Sub Total 103066319 16.61 103066319 15.86

Others -

Private Corporate Bodies 40094470 6.46 44094470 6.79Indian Public 165759649 26.71 165759649 25.52NRIs/OCBs 6562743 1.06 6562743 1.01Any Other - Clearing Members & Trusts 11034111 1.78 11034111 1.70

Sub Total 223450973 36.01 227450973 35.02

Total Non Promoter shareholding (b) 326517292 52.62 330517292 50.88

GRAND TOTAL (a + b) 620541349 100.00 649541349 100.00

ii) “B” Equity Shares of the Company (shares with lower

voting rights) - There will not be any change in Share

holding Pattern of B Equity Shares (DVR Shares) of

the Company pursuant to this offer since this offer

will not result in issuance of any B Equity Share.

The Proposed Preferential Offer is not expected to

result into any change in the Management Control

of the Company.

e) Proposed time limit within which allotment will be completed:

The proposed allotment and credit of warrants of securities will be completed within 15 days period from the date of Annual General Meeting. The allotment of 2,90,00,000 Equity Shares resulting from the exercise of options attached to the said warrants if exercised, will be completed within a period not exceeding 18 months from the date of issue of the warrants, as may be decided by the Board of Directors of the Company.

Notice (contd.)

10


f) Identity of the Allottee(s) with percentage of expanded capital to be held by them:

The existing holding and percentage of expanded capital to be held by proposed Allottee(s) are given below

Sr No Proposed Allottee(s)

% %

Existing Shareholdings Shareholding post conversion

No. of Equity No. of Equity Shares & “B” Shares & “B”

Equity Shares Equity Shares

1 Dharwad Traders Pvt Ltd Nil 0.00 1,50,00,000 2.312 Lunva Traders Pvt Ltd Nil 0.00 1,00,00,000 1.543 Bennett Coleman & Co Ltd 40,00,000 Equity 0.64 80,00,000 Equity 1.23

Shares & 4,00,000 Shares & 4,00,000 “B” Equity Shares “B” Equity Shares

Notice (contd.)

Natural person in control of the Allottees:

Mr Arun Kumar Jagatramka and Mrs Mona Jagatramka, Promoters of the Company are having control over Dharwad Traders Pvt Ltd and Lunva Traders Pvt Ltd as per the proviso to Regulation 73(1)(e) of SEBI (ICDR) Regulations.

Mr. Samir Jain and Mr. Vineet Jain are having control over Bennett Coleman & Co Ltd as per the proviso to Regulation 73(1)(e) of SEBI (ICDR) Regulations.

g) Relevant Date

The Relevant Date for the purpose of pricing of the Warrants would have been 31st August, 2014, being the date which is 30 days prior to the Annual General Meeting i.e. 30th September, 2014. However, in terms of the SEBI (Issue of

Capital and Disclosure Requirements) (Amendment)

Regulations 2012 dated 30th January 2012, where the

relevant date falls on a Weekend/Holiday, the day preceding

the Weekend/Holiday will be reckoned to be the relevant

date. Since, 31st August 2014 and 30th August 2014 are

weekend and 29th August, 2014 is holiday, therefore 28th

August 2014 shall be deemed to be the Relevant Date.

h) Lock-in Period

The proposed allotment of Convertible warrants and theproposed Equity Shares to be allotted pursuant to the conversion of these warrants, if any, as and when made shall be locked in as per the provisions of SEBI (ICDR) Regulations.

i) Certificate from Statutory Auditors :

M/s N C Banerjee & Co., Chartered Accountants have certified that proposed issue of Convertible Warrants by the Company is being made in accordance with SEBI (ICDR) Regulations. A copy of the said certificate is open for inspection at the Registered Office of the Company on all working days between 12 noon and 2 pm upto the date of Annual General Meeting.

Basis or justification for the price (including premium, if

any) at which the offer or invitation is being made The

pricing of the Warrants to be allotted on preferential basis to the proposed allottees shall not be lower than the price determined in accordance with the SEBI (ICDR) Regulations.

Currently SEBI (ICDR) Regulations provide that the issue of Warrants on preferential basis can be made at a price not less than higher of the following:

� The average of the weekly high and low of the closing prices of the related equity shares quoted on the recognized stock exchange during the twenty-six weeks preceding the relevant date; Or

� The average of the weekly high and low of the closing prices of the related equity shares quoted on a recognized stock exchange during the two weeks preceding the relevant date.

The Relevant Date for the purpose of pricing of the Equity Shares is 28th August 2014, The Stock Exchange for this purpose shall mean any of the recognized stock exchanges on which the highest trading volume in respect of the shares of the Company will be recorded during the preceding twenty-six weeks prior to the Relevant Date.

Section 62(1)(c) of the Companies Act, 2013 provides, inter alia, that increase in subscribed capital by further issue of shares to any persons other than the existing shareholders or to the employees under employee stock option scheme shall be authorised by a special resolution. Hence, your approval is sought in terms of the provisions of the Companies Act, 2013 read with the provisions of the Companies (Management and Administration) Rules, 2014 to item no. 10 of the notice. Your Directors recommend the resolution for your approval.

Apart from Mr Arun Kumar Jagatramka and Mrs Mona Jagatramka who may be deemed to be concerned or interested in the following companies as Directors/ shareholders (details of shareholding given below), none of the other Directors, Key Managerial Personnel of the company or their relatives are deemed to be concerned or interested whether financially or otherwise in this resolution.

Sr No Name of the Company Nature of Shareholding Interest of

Mr. Arun Kumar Jagatramka Mrs Mona Jagatramka

1 Dharwad Traders Pvt Ltd 6,500 shares of Re. 1/- each i.e. 6% (approx) 4,400 shares of Re. 1/- each i.e. 4% (approx)

2 Lunva Traders Pvt Ltd 6,500 shares of Re. 1/- each i.e. 6% (approx) 4,400 shares of Re. 1/- each i.e. 4% (approx)

11


Notice (contd.)

Item No. 11:

The Company has on October 29, 2012 and November 19, 2012 issued 200, 5.5% Unsecured Foreign Currency Convertible Bonds (‘‘FCCB”) due 2017 of USD 1,00,000 each aggregating USD 20 million. As per the terms of the FCCB, the Company has fixed the Conversion Price of Rs. 22.50 per equity shares with a fixed rate of exchange of Rs. 53.7350 to USD 1.00 and Bonds are convertible at any time on or before October 29, 2017 by holders of the Bonds into the Company's fully paid equity shares with full voting rights with a par value of Rs. 10 each on the terms described in the Offering Circular dated 29 October 2012 at the option of the Bondholder. If not converted, the company is required to redeem each bond at 100% of its principle amount on October 30, 2017. The USD 20 million (“Proceeds”) that was raised from the FCCB offering was deposited in the escrow account opened by the Company. The Company used all these proceeds from the issue of the Bonds towards the capital expenditure of the Company, overseas direct investment in joint ventures and any other use, as permitted under applicable statutory and/or regulatory requirements from time to time.

Consequent to the issue of the FCCB, due to recessionary trends and subdued domestic and global demand for metcoke, the market price per equity shares of the Company declined. The alignment of the conversion price to the current market price will enable the Company to pursue with the FCCB investors to convert the FCCB into equity shares rather than waiting for the redemption of the FCCB till maturity. Further, based on the abovementioned circumstances the Company is proposing to reset the Conversion Price of the Bonds mentioned in the Offering Circular.

The Company proposes to revise the conversion price including, if required, by amending the terms and conditions of the FCCB, as it would be beneficial for the Company.

The minimum reset conversion price is worked out as average of the weekly high and low of the closing price of the equity shares of the Company quoted on NSE, where there is higher volume, during the two weeks preceding the date of the meeting of the Board of Directors of the Company i.e. 14th August, 2014.The minimum price worked out as above is Rs. 10.81. Accordingly, it has been proposed to reset the conversion price from Rs. 22.50 per share to Rs. 12.00 per share subject to the approval of shareholders and other regulatory authoriies.

The proposed transaction will help the Company in aligning its capital structure across all debt holders, in having the flexibility to combat the medium term challenges in its business environment, in removing the threat of acceleration on all its debt facilities and in having a significant cash net savings. This would also provide the Company necessary financial flexibility in the current business environment. For revision of the Conversion price of the FCCB, the shareholders of the Company must pass a resolution to this effect.

The Board recommends the resolution set out in item no. 11 of the notice for your approval.


By Order of the Board

For GUJARAT NRE COKE LIMITED

Place : Wollongong Arun Kumar JagatramkaDated : 14th August, 2014 Chairman & Managing Director

(Annexure to the Notice)

INFORMATION REQUIRED TO BE FURNISHED UNDER CLAUSE 49 OF THE LISTING AGREEMENT IN RESPECT OF DIRECTORS

SEEKING APPOINTMENT/RE-APPOINTMENT

Name of the Director Mr Sananguly Murari Mr Sisir Kumar Mukherjee Mr Gopal Prasad Dokania

Date of Birth 03-11-1942 18-07-1943 19-01-1952

Date of Appointment 29-12-2005 18-03-2014 30-06-2014

Qualifications B.E. (Mechanical) B. Com (H), Certified Associate B. Com, LL.B, FCAof Indian Institute of Bankers, Mumbai

Expertise in specific Iron Oxide Pellet making and Finance, Corporate Management etc. Taxation, Merger & functional areas Mineral dressing, Mining etc. Acquisition etc.

Directorship in other Nil Haldia Petrochemicals Ltd Nilpublic Companies

Chairmanship/ Nil Audit Committee, HSE Committee NilMember-ship of and Smooth Plant Operations Committees in other Committee of Haldia public Companies Petrochemicals Ltd.

Shareholdings as on Nil 1,000 Equity Shares 1,100 Equity Shares (as on the 31st March' 2014 date of his appointment)

12

Directors’ Report


To

The Members,

Your Directors present 27th Annual Report and the Audited Financial Statements for the financial year ended 31st March, 2014.

FINANCIAL RESULTS/HIGHLIGHTS

(Rs. in crores)

2013-14 2012-13

Total Income 1250.64 1751.94

Total Expenditure 1644.87 1336.37

Profit/(Loss) before Interest, Depreciation and Tax (394.23) 415.57

Less: (1) Finance Cost 331.40 263.02

(2) Depreciation 61.30 58.33

Profit/(Loss) before Tax and

Exceptional Items (786.93) 94.22

Exceptional Items 47.47 47.95

Less: Provision for Taxation (273.59) 15.29

Profit/(Loss) after Tax (560.81) 30.98

Add : Amount brought forward – –

Amount available for appropriation (560.81) 30.98

Less : Amount transferred to General Reserve 10.80 –

Add : Dividend for earlier yearwritten back 28.87 –

Add : Dividend tax written back 4.68 –

Less : Transferred to Debenture Redemption Reserve – 30.98

Balance carried to Balance Sheet (538.06) –

REVIEW OF OPERATIONS

During the year under review, the Total Income from operations was Rs.1250.64 Crores as compared to Rs 1751.94 Crores in the previous year. The Company has suffered net loss of Rs. 560.81 crores during the year, as compared to the Profit of Rs. 30.98crores during the previous year.

Steel industry, which is the largest consumer of coking coal and metcoke, continued to reel through extreme recessionary trends which has resulted in subdued demand of metcoke and also dragged its realizations to rock bottom levels. This had resulted in huge built up of inventories of coking coal and metcoke impacting the cash flows in the business.

In view of these adversities, Corporate Debt Restructuring Empowered Group (CDR EG), upon being approached by the Company, have approved CDR Package in March, 2014 under Corporate Debt Restructuring mechanism (CDR) issued by Reserve Bank of India.

The key features of CDR Package are given in detail in the Notes to the Financial Statements forming part of this Annual Report.

DIVIDEND

In view of the losses incurred, the Board does not recommend any dividend.

ISSUE OF EQUITY

The Company has allotted equity shares of Rs. 10/- as per following details:-

Date of Allotment No. of shares Particulars

22nd May, 2013 50,00,000 Issued to Promoters Group entities at a premium of Rs. 11.08 per share upon conversion of Warrants

17th June, 2014 1,21,61,222 Issued to ICICI Bank Ltd. at a premium of Rs. 1.01 per share upon conversion of Funded Interest Term Loan

17th June, 2014 3,35,00,000 Issued to Promoters Group entities at a premium of Rs. 0.90 per share upon conversion of Warrants

ISSUE OF CONVERTIBLE WARRANTS

The Company allotted 10,00,00,000 convertible warrants on 18th April, 2014 at a conversion price of Rs. 10.90 per Warrant aggregating Rs. 109 crores only and 6,00,00,000 convertible warrants on 17th June, 2014 at a conversion price of Rs. 10.72 aggregating Rs. 64.32 crores on preferential basis to the Promoter Group entities. Each Warrant is convertible at the option of the holders into One Equity Share of Rs. 10/- each.

NON-CONVERTIBLE DEBENTURES

During the year under review, the company redeemed Non-Convertible Secured Redeemable Debentures (NCDs) amounting Rs. 34.99 crores as per the terms of issue of these debentures. The NCDs amounting to Rs. 427.51 crores were outstanding at the end of the year under review.

LISTING

Both the Equity Shares and “B” Equity Shares of the Company are listed at the National Stock Exchange of India Limited (NSE) and BSE Limited (BSE). The Non-convertible Debentures of the company (including Debentures issued under QIP) are listed at BSE. The convertible warrants issued by the Company under QIP are listed at NSE and BSE. The Foreign Currency Convertible Bonds (FCCBs) are listed at Singapore Exchange Limited (SGX).

BUSINESS PLANS

The market for metcoke continued to remain sluggish during the year under review due to dwindling demand from Steel industry, the major user of metcoke. This had severely impacted realisations of our products.

Due to the market imbalances and the continued global economic slowdown, the Company has been facing liquidity constraints. This has resulted in the Company realigning its debts under CDR mechanism through CDR Package. The Company plans to gradually increase its capacity utilization along with its turnover and margins in a phased manner.

The Company's projects for generation of power from waste heat emanating from its Coke Oven Plants in the States of Karnataka and Gujarat had to be temporarily shelved during the year under review due to liquidity constraints. However, during 2014-15 the project at Dharwad in Karnataka is proposed to be revived as it is at an advanced stage of completion. The Company is presently generating power through non polluting method i.e. through wind turbine generators having capacity to generate 87.5 MW of power.

SUBSIDIARIES

During the year, Jindal Steel & Power Ltd (Jindal Group) had acquired majority stake in Gujarat NRE Coking Coal Ltd. (GNCCL), erstwhile Australian mining subsidiary of the Company. Accordingly, GNCCL along with its three subsidiaries viz. Gujarat NRE Wonga Pty Ltd, Gujarat NRE Resources NL and Southbulli

13


Holdings Pty Ltd ceased to be subsidiaries of the company. The other five Australian subsidiaries of the Company viz. Gujarat NRE Properties Pty Ltd, Gujarat NRE Ltd, Gujarat NRE Coal (NSW) Pty Ltd, Wonga Coal Pty Ltd and Gujarat NRE India Pty Ltd also ceased to be subsidiaries during the year due to restructuring of their respective share capital.

The Company has two Wholly-owned Indian Subsidiaries i.e. Manor Dealcom Pvt Ltd and Huntervalley Coal Pvt Ltd. The Financial Statements and other reports of these subsidiaries are not attached to this Annual Report pursuant to a general exemption granted under circular no 2/2011 dated 8th February 2011 of Ministry of Corporate Affairs. The relevant information of these subsidiaries as required by the said Circular of Ministry of Corporate Affairs has been provided in this Annual Report.

The Financial Statements and other reports related to these subsidiaries are available at Registered Office of the Company during the working hours and a copy thereof will be provided to the shareholders of the Company upon request.

MERGER

The Scheme of Amalgamation of Bharat NRE Coke Limited with the Company was approved by the shareholders of the Company on 28th January, 2013. However in view of subsequent development of reference of the Company to CDR EG for its debt restructuring, the said amalgamation was not allowed by the Hon'ble High Court of Calcutta.

CORPORATE GOVERNANCE

In compliance with the requirements of clause 49 of the Listing agreement with Stock Exchanges, a Report on 'CorporateGovernance' as on 31st March, 2014 and a Report on Management Discussions and Analysis are annexed to and form a part of this Report.

Chairman & Managing Director (CEO) and Chief Financial Officer (CFO) have certified to the Board with regard to the financial statements and other matters as required by the aforesaid clause of the listing agreement and the said certificate is also annexed to and forms a part of this Report.

EMPLOYEE STOCK OPTION SCHEME

The Company had granted 95,89,000 options to its Employees/Directors through four different tranches under GNCL Employee Stock Options Scheme 2007 (ESOP 2007) till the end of previous year against the approval received from shareholders to grant upto 1,21,95,302 options under the said Scheme.

As required by clause 12 of the SEBI (Employee Stock OptionScheme and Employee Stock Purchase Scheme) Guidelines 1999,the disclosures with regard to Stock Options in respect of GNCLEmployee Stock Option Scheme 2007 as on 31st March, 2014 aregiven in an Annexure to this Report.

The Company has received a certificate from the Auditors that the aforesaid Scheme has been implemented in accordance with SEBI Guidelines and the resolution passed by the shareholders. The Certificate would be placed at the meeting for inspection by the shareholders.

DIRECTORS

Dr Basudeb Sen and Mr Chinubhai R Shah, Non Executive Directors resigned from their office w.e.f. 18th March 2014 and Mr Subodh Kumar Agrawal, Non Executive Director has resigned from his office w.e.f. 25th May 2014. The Board records its appreciations for the services rendered by them during their tenure in the Company.

Dr Mahendra Kumar Loyalka retires by rotation at the forthcoming Annual General Meeting and express his unwillingness to be re-appointed.

Mr Sisir Kumar Mukherjee was appointed by the Board as a Director in the casual vacancy caused by the resignation of Dr Basudeb Sen in terms of Section 161(4) of the Companies Act 2013 w.e.f. 18th March 2014 and accordingly, he retires by rotation at the ensuing Annual General Meeting.

Mr Sisir Kumar Mukherjee and Mr Sananguly Murari are proposed to be re-appointed as Directors designated as Independent Directors of the Company pursuant to the provisions of Section 149 of Companies Act 2013 w.e.f. 1st October 2014 and the Listing Agreement for a period of 5 years and they shall not be liable to retire by rotation.

Mr Gopal Prasad Dokania was appointed as an Additional Director by the Board at its meeting held on 30th June 2014 to hold office upto the date of ensuing Annual General Meeting. It is proposed to appoint him as a Director designated as Independent Director at the ensuing Annual General Meeting for a period of 5 years w.e.f. 1st October 2014 and he shall not be liable to retire by rotation.

Mr C Narasimhan has been appointed as a Nominee Director of State Bank of India w.e.f. 8th August 2013.

DIRECTORS' RESPONSIBILITY STATEMENT

Pursuant to the requirements under Section 217(2AA) of the Companies Act, 1956 with respect to Directors' Responsibility Statement, your Directors confirm having -

i) Followed in the preparation of the annual accounts the applicable accounting standards with proper explanation relating to material departures;

ii) Selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the year under review and of the profit of the Company for the year ended on that date;

iii) taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the company and for preventing and detecting fraud or other irregularities; and

iv) prepared the annual accounts on a 'going concern basis'.”

AUDITORS

M/s. N. C. Banerjee & Co., Chartered Accountants, the Statutory Auditors hold office upto the forthcoming Annual General Meeting of the Company and are eligible for reappointment. As required under the provisions of Section 139 of the Companies Act, 2013, the Company has received written confirmation from M/s. N C Banerjee & Co., that their re-appointment as Auditors, if made, would be in conformity within the limits prescribed in the said Section and that they are not disqualified from being appointed as the Auditors of the Company within the meaning of Section 226 of the said Act.

AUDITORS' REPORT

The Directors refer to the auditors' observation in the Auditors' Report and as required under Section 217(3) of the Companies Act, 1956, provide their explanation as under:

i. In respect of auditors' observation in standalone financial statements regarding default in payment of interest and

Directors’ Report (contd.)

14


repayment of dues to financial institutions, banks and NCD holders as per para (xi) of Annexure to Auditors Report :

. Due to the continued slowdown in the domestic and global market, the operations of the company were severely impacted. The Company ended the financial year with a high operating loss mainly due to lower price realizationdiminution in the value of stocks, and unusual diminutions in the value of rupees as against the US dollar. Due to above, the company was unable to meet its interest and principal liabilities under the various credit facilities from financial institutions, banks and NCD holders in time. Consequently, the Company's debts were restructured under the Corporate Debt Restructuring (CDR) Forum. The company is also taking various steps to reduce costs and improve efficiencies to make its operations profitable.

ii. In respect of auditors' observation in standalone financial statements regarding delay in depositing statutory dues, as per para (ix) of Annexure to Auditors Report, with the appropriate authorities :

It is clarified that the delay arose on account of mismatch in cash flow/liquidity issues due to prevailing uncertain economic environment that adversely impacted operating conditions as stated above.

iii. In respect of auditors' Qualifications in consolidated financial statements regarding considering Financial Statements of erstwhile five Australian Subsidiaries, which were more than six months old on the date on which these five companies ceased to be subsidiaries of the company and in respect of remaining four erstwhile Australian Subsidiaries, the Management Approved Accounts as on the date on cessation of Subsidiaries has been considered :

Due to acquisition of majority stake in the Australian mining Company Gujarat NRE Coking Coal Ltd (GNCCL) by the Jindal Steel & Power Ltd. (Jindal Group) in November 2013, the said mining Company along with its Australian subsidiaries company ceased to be subsidiaries of the Company from that date. The New Management of GNCCL has not complied with the company's request for providing Audited Financial Statement of the erstwhile Australian Subsidiaries for the relevant period. Hence for the purposes of deconsolidation of these subsidiaries the company has considered latest available Audited Consolidate Financial Statement as on 31st March, 2013 of these companies.

As far as other erstwhile Australian Subsidiaries are concerned, the Management Approved Accounts were made available to the company on the date it ceased to be subsidiaries of the company, as Audit of these companies were not mandatory as per rules and regulation of that country.

,

COST AUDIT

The Company had reappointed M/s B Mondal & Co., Practicing Cost Accountants as Cost Auditor under the provisions of Section 233B of the Companies Act, 1956, to audit the cost records of its steel and metcoke plant(s) for the financial year 2013-14.

The particulars of cost auditor/cost audit report etc. as required by General Circular no 15/2011 dated 11th April 2011 issued by Cost Audit Branch of Ministry of Corporate Affairs, Government of India are given below

a) Name & address of the Cost Auditor – M/s. B Mondal & Associates61/H/15, Raja Naba Krishna Street,Kolkata - 700 005.

b) Name and membership no of the partner of the firm –Mr Baidyanath Mondal, Membership no - 11681.

c) Due date of filing and actual date of filing of the cost audit report for the year 2012-13

Due date of filing :- 30.09.2013

Actual date of filing :- 31.03.2014

PUBLIC DEPOSITS

The Company has not accepted or renewed any Public Deposits, as defined under Section 58A of the Companies Act, 1956, during the year under review.

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

The information on Particulars of conservation of energy, technology absorption and foreign exchange earnings and outgo as required under Section 217(1)(e) of the Companies Act, 1956, read with the Companies (Disclosure of Particulars in the Report of the Board of Directors) Rules, 1988 are annexed and forms a part of Annual Report. However, as permitted by Section 219(1)(b)(iv) of the Act, this Annual Report is being sent to all the members of the Company excluding the said Annexure. The Annexure is available for inspection by members at the Registered Office of the company during business hours on working days till the ensuing AGM and if any member is interested in obtaining a copy of thereof, such member may write to the company, whereupon a copy would be forwarded to such member.

PARTICULARS OF EMPLOYEES

There was no employee during the year under review , who was in receipt of remuneration of more than Rs. 5,00,000/- per month if appointed for a part of the year or Rs. 60,00,000/- per annum, if appointed for whole year. Therefore, the particulars of employees as required under Section 217 (2A) of the Companies Act, 1956 read with the Companies (Particulars of Employees) Rules, 1975 as amended, are not applicable.

PERSONNEL / INDUSTRIAL RELATIONS

The Company maintained cordial and harmonious relations at all levels at the offices and plants of the Company and its subsidiaries throughout the year under review.

APPRECIATION

We wish to acknowledge the understanding, support and services of our workers, staff and executives which has largely contributed to efficient operations and management of the Company during the year under review. We also take this opportunity to express our deep sense of gratitude to all our customers, dealers, suppliers, bankers, government officials and all other business associates for their continuous guidance and support to the Company and their continued confidence in its management. We also take this opportunity to express our sincere thanks to our shareholders and debenture holders for the confidence and faith in our company.

For and on behalf of the Board

Place : Wollongong Arun Kumar Jagatramka

Dated : 14th August, 2014 Chairman & Managing Director

Directors’ Report (contd.)

15

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18

Report on Corporate Governance


1. Philosophy on Corporate Governance:

At Gujarat NRE, Corporate Governance gets high priority. The company believes that good Corporate Governance strengthens the investors' trust and ensures a long term partnership which helps in achieving Company's objectives. The Company's philosophy on Corporate Governance lays strong emphasis on transparency, accountability and integrity. This philosophy is manifested in its operations through exemplary standards of ethical behavior.

Gujarat NRE Coke is committed to good Corporate Governance by creating an environment based on entrepreneurship, professionalism and pursuit for excellence. The company's corporate governance is based on two core principles:

� Management must have executive freedom to drive the enterprise forward without undue restraints; and

� This freedom of management must be exercised within a framework of effective accountability.

The above belief and core principles of Corporate Governance adopted by Gujarat NRE Coke leads the company's governance philosophy, trusteeship, transparency, independence, fairness, accountability and

social responsibility, which in turn is the basis of public confidence in corporate system.

A Report in line with the requirement of clause 49 of listing agreement with Stock Exchange for the year ended 31st March, 2014 is given below.

2. Board of Directors:

Composition, Category & Independence etc.

The Board of Directors of the Company represents anappropriate mix of executive and Non-executive Directors. TheBoard consists of seven members - (1) One Executive, Non-Independent Director, (2) Two Non-Executive, Non-Independent Directors and (3) Four Non-Executive,Independent Directors.

All the Independent Directors satisfies the criteria of independence as provided in the Clause 49 of the Listing Agreement. All the Non-Executive Directors are eminent professionals and bring their professional expertise and experience to the management of the Company.

The Chairman & Managing Director has been appointed by the shareholders on terms and conditions including remuneration as per the recommendation of the Board of Directors. The Non-Executive Directors are appointed or reappointed with the approval of the shareholders.

The following Table indicates the composition of Board of Directors of the Company and the number of other Boards and Board committees served by them as member(s)/chairman as on 31st March 2014:

Name of the Director Category No. of other No. of other Board Directorships* Committee** position as

Member Chairman

Mr. Arun Kumar Jagatramka, Promoter Executive 8 3 –Chairman & Managing Director

Mrs. Mona Jagatramka Promoter Non-Executive 6 – –

Dr. Mahendra Kumar Loyalka Independent Non Executive - - -

Mr. Subodh Kumar Agrawal Independent Non Executive 1 1 -

Mr. Murari Sananguly Independent Non Executive - - -

Mr Sisir Kumar Mukherjee Independent Non Executive 1 1 2(appointed w.e.f. 18.3.2014)

Mr. C Narasimhan Non- Independent Non Executive 1 - -(appointed w.e.f. 8.8.2013)

* Directorship in Foreign Companies, Private Limited Companies and Companies covered under Section 25 of the Companies Act, 1956 have not been considered.

** Only the positions held in Committees, such as audit and shareholders' grievance committee in Indian Public Limited Companies have been considered.

Meetings and Attendance Record of Directors.

The Board meets on a regular basis to ensure overall focus on preserving and increasing stakeholders' value. This includes review of Company strategy and performance, management oversight, ethical business practices and legal compliance, accounting and financial controls, financial structure, preservation of assets and Board effectiveness. The required information as enumerated in Annexure IA of Clause 49 of the Listing Agreement is made available to the Board of Directors for discussion and consideration at the Board Meeting. The Chairman & Managing Director keeps the Board apprised of the overall operations & performance of the Company and about the market of the products of the Company.

During the year ended March 31, 2014, 7 (Seven) Board Meetings were held on 29 April, 2013, 26 May 2013, 11 August 2013, 30 September 2013, 9 November 2013, 8 February 2014, 18 March 2014. The time gap between any two consecutive board meetings did not exceed four months. The last AGM was held on 30 September, 2013.

19


Report on Corporate Governance (contd.)

The following Table indicates the attendance of each Director at Board Meetings and at the last Annual General Meeting (AGM)

Name of the Directors No. of Board No. of Board Attendance at last AGM Meetings held Meetings Attended * held on 30.9.2013

Mr. Arun Kumar Jagatramka 7 7 Yes

Mrs. Mona Jagatramka 7 6 Yes

Mr. Subodh Kumar Agrawal 7 0 No

Dr. Mahendra Kumar Loyalka 7 7 Yes

Mr. Murari Sananguly 7 5 Yes

Mr. C. Narasimhan (appointed w.e.f. 8.8.2013) 5 3 No

Mr Sisir Kumar Mukherjee (appointed w.e.f. 18.3.2014) 0 0 N.A.

Dr Basudeb Sen (ceased to be a Director w.e.f. 18.3.2014) 7 6 Yes

Mr Chinubhai R Shah (ceased to be a Director w.e.f. 18.3.2014) 7 7 Yes

(* Includes participation through tele-conference/video-conference)

3. Code of Conduct

The Company's Board has laid down a Code of Conduct for all Board members and senior management personnel for avoidance of conflict of interest. This Code inter alia requires the Board members and senior management personnel to comply with the Code of Conduct for Insider Trading as laid down by Securities & Exchange Board of India (SEBI). The Company has received necessary confirmations affirming compliance of the Code from all of them during the year 1.4.2013 to 31.3.2014. A declaration to this effect, duly signed by the Chairman & Managing Director and Chief Financial Officer of the Company, is given in CEO & CFO's Certificate as annexed hereto and forms a part of this Report.

4. Board Committees:

To focus effectively on the issues and ensure expedient decision making/resolution of diverse matters, the Board has constituted various Committees with specific terms of reference/ scope. The Committees operate as empowered agents of the Board as per their Charter/terms of reference.

As on 31st March 2104, there are 5 (five) Committees of the Board namely Audit Committee, Share Transfer Committee,Shareholders/ Investors ' Gr ievance Commit tee, Remuneration/Compensation Committee and Management Committee. The scope of the said Committees and itsmemberships etc. are as follows:

(a) Audit Committee

i) Terms of Reference. The primary objective of the committee is to monitor and provide effective supervision of the Management's financial reporting process to ensure accurate and timely disclosures, with the highest levels of transparency, integrity and quality of financial reporting. The terms of reference of the Audit Committee are in conformity with the requirements of Clause 49 of the Listing Agreement and Section 292A of the Companies Act, 1956. These broadly cover the following:

1) To oversee the Company's financial reporting process and the disclosure of its financial information to ensure that the financial statements are correct, sufficient and credible.

2) To review and recommend to the Board the appointment, re-appointment and if required removal of statutory auditors.

3) To review with the management, the financial statements before submission to the Board, focusing primarily on Directors Responsibility Statement which forms part of the Directors Report, accountingpolicies, compliance with accounting standards, compliance with Stock Exchanges and legalrequirements and any related party transactions etc.

4) To review with the management, external and internal auditors, the adequacy of internal control systems.

5) To discuss with the Auditors on the scope and nature of Audit and also to have Post Audit discussion to ascertain any area of concern.

6) To review the Company's financial and risk management policies.

7) To review the financial statements of unlisted subsidiary company, in particular, the investment made if any, and all significant transactions entered into by the subsidiary company.

8) To review the minutes of the Board meetings of the unlisted subsidiary company along with a statement of significant transactions and arrangements it has entered into, if any.

9) To review the statement of material related party transactions.

10) To undertake such other matters as may be delegated by the Board from time to time.

ii) Composition

The composition of the Audit Committee as on 31st March 2014 is as follows:

Mr. Sisir Kumar Mukherjee - Committee Chairman

Mr. Murari Sananguly - Director

Dr. Mahendra Kumar Loyalka - Director

All the members of the Committee are Non-Executive Directors. Mr. Sisir Kumar Mukherjee, an Independent Director is a Bachelor of Commerce and a Certified Associate of Indian Institute of Bankers, Mumbai. Dr Mahendra Kumar Loyalka and Mr Murari Sananguly are other Directors possessing extensive experience in the respective fields of accounting, taxation, business policies and management. The Company Secretary acts as the Secretary to this Committee.

20



iii) Meetings and Attendance

The Audit Committee met four times during the year under review on 26 May, 2013, 11 August, 2013, 9 November 2013 and 8 February, 2014.The attendance of the committee members in these meetings were as follows.

Name(s) Held Attended*

Dr. Mahendra Kumar Loyalka 04 04Mr Murari Sananguly 04 03Mr. Subodh Kumar Agrawal 04 00Dr. Basudeb Sen 04 04Mr. Chinubhai R Shah 04 04

(* Includes participation through tele-conference/video-conference)Mr. Sisir Kumar Mukherjee was appointed on 18 March, 2014 and no Audit Committee meeting was held in his tenure upto 31 March 2014. Dr. Basudeb Sen, Mr. Chinubhai R Shah and Mr. Subodh Kumar Agrawal ceased to be committee members on 18 March, 2014.The Statutory Auditors of the Company are invited to attend audit committee meeting whenever required. Chairman & Managing Director, Chief Financial Officer (CFO), Chief Commercial Officer, Vice President, Internal Auditor and other senior executives are also invited to attend and deliberate in the Audit Committee meetings.

(b) Share Transfer Committee

The Committee consists of the following members:

Mr Arun Kumar Jagatramka, CMD, Committee ChairmanMr Subodh Kumar Agrawal, DirectorDr Mahendra Kumar Loyalka, DirectorMr Sisir Kumar Mukherjee, DirectorMr Pawan Kumar Agrawal, Chief Commercial OfficerThe Committee meets at regular intervals to consider andapprove transfers, transmission and issue of duplicate sharecertificates. The Company Secretary acts as the Secretary tothis Committee. During the year under review, 8 meetings were held and the attendance of the committee members inthese meetings were as follows:


Mr Aurn Kumar Jagtramka 01 01Mr Subodh Kumar Agrawal 08 02Dr Mahendra Kumar Loyalka 08 08Mr Pawan Kumar Agrawal 08 06Dr Basudeb Sen 08 05Mr Sisir Kumar Mukherjee 01 01

(* Includes participation through tele-conference/video-conference).

Mr Aurn Kumar Jagtramka and Mr. Sisir Kumar Mukherjee were appointed on 18 March, 2014 and Dr. Basudeb Sen ceased to be member on 18 March, 2014.

(c) Shareholders'/Investors' Grievance Committee

The Committee consists of the following members:Mr. Arun Kumar Jagatramka, CMD, Committee ChairmanMr. Subodh Kumar Agrawal, DirectorDr. Mahendra Kumar Loyalka, DirectorMr. Sisir Kumar Mukherjee, Director

The Committee looks into the redressal of shareholders' andinvestors' complaints like transfer of shares, nonreceipt ofAnnual Reports & Accounts, non-receipt of dividends, nonreceipt of duplicate share certificates etc. The Committee met4 times during the year under review and the attendance ofthe committee members in these meetings were as follows:


Mr. Subodh Kumar Agrawal 4 1Dr. Mahendra Kumar Loyalka 4 4Dr Basudeb Sen 4 4


Mr Arun Kumar Jagatramka and Mr. Sisir Kumar Mukherjee were appointed on 18 March 2014 and no meeting was held during their tenure upto 31 March, 2014. Dr. Basudev Sen ceased to be Director and Committee Member on 18 March, 2014.Mr. Manoj K Shah, Company Secretary has been designated as the Compliance Officer by the Board andassigned with the responsibilities of overseeingshareholders'/investors' grievances under the supervision of the Committee. He also acts as the Secretary to this Committee. There were no complaints which remained pending at the beginning of the year and out of 60 complaintsreceived during the year all complaints were redressed andno complaint was pending as on 31st March, 2014.

(d) Remuneration/Compensation Committee.

The Committee consists of following members:Dr. Mahendra Kumar Loyalka, Committee ChairmanMr. Arun Kumar Jagatramka, Chairman & Managing DirectorMr. Subodh Kumar Agrawal, DirectorMr. Sisir Kumar Mukherjee, DirectorMr. Murari Sananguly, DirectorThe terms of reference of this Committee is to consider and recommend to the Board remuneration payable to managerial personnel including Chairman & ManagingDirector upon examining a) employment scenario, b)remuneration package, c) individual performance track record and d) the provisions relating to payment of managerial remuneration prescribed under the Companies Act, 1956 and/or rules framed under the said Act. The Company is committed to make full disclosures regarding its payment to all directors. Apart from sitting fees for attending Board and Committee meetings and commissions theCompany did not pay any other remuneration to the non-executive directors during the year under review. The details of remuneration paid by the Company to its Executive and Non-executive Directors during the yearunder review are given below. The Company Secretary acts as the Secretary to this Committee.The attendance at the meeting of the Committee during the year under review is as follows:


Dr Mahendra Kumar Loyalka 01 01

Mr. Subodh Kumar Agrawal 01 00

Mr Arun Kumar Jagatramka 01 01

Mr. Murari Sananguly 01 01

Dr Basudeb Sen 01 01

(* Includes participation through tele-conference/video-conference)Mr. Sisir Kumar Mukherjee was appointed on 18 March, 2014 and no such meeting was held during his tenure upto 31 March, 2014 and Dr. Basudeb Sen ceased to be Director and Committee Member on 18 March, 2014.

(i) Payments made to the Chairman and Managing Director & Whole time Director during the year under review are given in the following Table :

Name of the Directors Salary Perquisite Commission Contribution Total Service Contract/ to PF Notice Period/

(Rs.) (Rs.) (Rs.) (Rs.) (Rs.) Severance Fees

Mr. Arun Kumar Jagatramka 12,00,000 10,10,172 0 1,44,000 23,54,172 As per Service Contract

NB – The remuneration paid to Mr Arun Kumar Jagatramka during the year 2013-14 was in accordance with the provisions of Schedule XIII of the Companies Act 1956.

21



(ii) Details of sitting fees paid to the non-executive Directors for the year ended 31 March 2014 along with shares/convertible instruments held by them are given in the following Table:

Name of the Director Equity Shares & “B” Sitting Commission Service Contract/

Equity Shares held Fees Paid * Paid (Rs.) Notice Period/

(Rs.) Severance Fees

Mrs. Mona Jagatramka 58,55,007 Equity Shares & 1,22,472 Nil Retire by Rotation5,85,500 “B” Equity Shares

Mr. Subodh Kumar Agrawal 35,000 Equity Shares & 10,000 Nil Retire by Rotation3,500 “B” Equity Shares

Mr. Chinubhai R Shah (Resigned w.e.f. 2,22,472 Nil Retire by Rotation(ceased to be Director from 18.3.2014) 18.3.2014)

Dr. Basudeb Sen (Resigned w.e.f. 3,04,944 Nil Retire by Rotation(ceased to be Director from 18.3.2014) 18.3.2014)

Dr. Mahendra Kumar Loyalka 35,000 Equity Shares & 4,63,540 Nil Retire by Rotation3,500 “B” Equity Shares

Mr. Murari Sananguly Nil 1,72,472 Nil Retire by Rotation

Mr C. Narasimhan Nil 60,000 Nil Director by nomination(appointed w.e.f. 8.8.2013)

Mr Sisir Kumar Mukherjee 1,000 Equity Shares 33,708 Nil Retire by Rotation(appointed w.e.f. 18.3.2014)

(* includes sitting fees paid for attending any committee meeting.)

NB – Non-executives Directors held convertible instrument viz. ESOP issued by the Company as per details given below.

(iii) Details of Outstanding Stock Options held by Directors, if any, as on 31st March 2014 and whether issued at a discount as well as the period over which accrued and over which exercisable are given in the following Tables :

A) Under GNCL Employee Stock Option Scheme, 2007 –1st tranche –

Name of the Director Options Outstanding Whether issued Period over which Period over as on 31.3.2014 at a discount Accrued which exercisable

Mr Subodh Kumar Agrawal 70,000 No On or After 1.6.2022 1.6.2022 to 31.5.2025

Dr. Mahendra Kumar Loyalka 70,000 No On or after 1.6.2013 1.6.2013 to 31.5.2016

Mr. Murari Sananguly 70,000 No - do - - do -

NB – The abovementioned options were re-priced and are convertible at the rate of Rs.18.05 per share as already stated in an Annexure to the Directors Report i.e. Disclosure on ESOP.

B) Under GNCL Employee Stock Option Scheme, 2007 – 3rd tranche -

Name of the Director Options Outstanding Whether issued Period over which Period over

as on 31.3.2014 at a discount Accrued which exercisable

Mr Subodh Kumar Agrawal 20,000 No On or after 9.7.2013 9.7.13 - 8.7.16

20,000 No On or after 9.7.2014 9.7.14 8.7.17

20,000 No On or after 9.7.2015 9.7.15 8.7.18

Dr. Mahendra Kumar Loyalka 20,000 No On or after 9.7.2013 9.7.13 - 8.7.16

20,000 No On or after 9.7.2014 9.7.14 8.7.17

20,000 No On or after 9.7.2015 9.7.15 8.7.18

Mr. Murari Sananguly 20,000 No On or after 9.7.2013 9.7.13 - 8.7.16

20,000 No On or after 9.7.2014 9.7.14 8.7.17

20,000 No On or after 9.7.2015 9.7.15 8.7.18

22



C) Under GNCL Employee Stock Option Scheme, 2007 – 4th tranche -

Name of the Director Options Outstanding Whether issued Period over which Period over

as on 31.3.2013 at a discount Accrued which exercisable

Mr Subodh Kumar Agrawal 15,000 No On or after 30.09.2014 30.09.2014 - 29.09.2017

15,000 No On or after 30.09.2015 30.09.2015 - 29.09.2018

15,000 No On or after 30.09.2016 30.09.2016 - 29.09.2019

Dr. Mahendra Kumar Loyalka 15,000 No On or after 30.09.2014 30.09.2014 - 29.09.2017

15,000 No On or after 30.09.2015 30.09.2015 - 29.09.2018

15,000 No On or after 30.09.2016 30.09.2016 - 29.09.2019

Mr. Murari Sananguly 15,000 No On or after 30.09.2014 30.09.2014 - 29.09.2017

15,000 No On or after 30.09.2015 30.09.2015 - 29.09.2018

15,000 No On or after 30.09.2016 30.09.2016 - 29.09.2019

(e) Management Committee

Management Committee consists of the following members:

i. Mr. Arun Kumar Jagatramka, CMD, Committee Chairman

ii. Dr. Mahendra Kumar Loyalka, Director

iii. Mr Sisir Kumar Mukherjee, Director (appointed w.e.f. 18.3.2014)

iv. Mr. P. R. Kannan, Chief Financial Officer

v. Mr. Pawan Kumar Agrawal, Chief Commercial Officer

The term of reference of the committee comprises of matters such as allotment of shares on conversion of FCCBs/ Warrants/ESOP etc., to borrow other than by issue of Debenture(s), to give Loan(s)/ Advance(s) as well as to invest funds of the company, to issue securities and/or to provide guarantee(s) on the basis of limits prescribed by the Board, opening and closure of bank accounts, filing of forms

and any other matter of routine nature etc. subject to guidelines and supervision of the Board. The Company Secretary acts as the Secretary to this Committee. The committee met 19 times during the year under review. The attendance of the Committee members at the Management Committee meetings during the year under review were as follows:


Mr. Arun Kumar Jagatramka 19 19

Mr. Subodh Kumar Agrawal 19 9

Dr. Mahendra Kumar Loyalka 19 19

Mr Sisir Kumar Mukherjee 04 04

Mr. P. R. Kannan 19 18

Mr. Pawan Kumar Agrawal 19 19


5. General Body Meetings:

a) The details of last 3 Annual General Meetings :

Year Meeting Location Date Time Special Resolution, if any

2012-13 26th AGM Kala Mandir, 30.09.2013 10.00 A.M. Yes48, Shakespeare Sarani,Kolkata – 700 017

2011-12 25th AGM Kala Mandir, 28.09.2012 11.30 A.M. No48, Shakespeare Sarani,Kolkata – 700 017

2010-11 24th AGM Kala Mandir, 30.09.2011 11.30 A.M. Yes48, Shakespeare Sarani,Kolkata – 700 017

23



b) Postal Ballot: One Postal Ballots was held by the company during the financial year ended 31st March 2014 as per following details -

(I) Two Special Resolution(s) were passed by the members through Postal Ballot as per results declared on 17th June 2013. The Results are given below –

i) To make investment/loan and/or give guarantee/security in excess of limits under Section 372A of Companies Act, 1956 –

Promoter/Public No. of shares No. of votes % of Votes No. of Votes No. of Votes % of Votes % of Votesheld polled Polled on in favour against in favour on against on

outstanding votes polled votes polledshares

(1) (2) (3) (4) (5) (6) (7)= [(2)/(1)]*100 = [(4)/(2)]*100 = [(5)/(2)]*100

Promoter and Promoter Group 312943136 289082680 92.38 289082680 0 100.00 0.00

Public - Institutional holders 18200784 18200784 100 5047491 13153293 27.73 72.27

Public-Others 653787 485046 74.19 322734 162312 66.54 33.46

Total 331797707 307768510 92.76 294452905 13315605 95.67 4.33

ii) Issuance of Securities (including Foreign Currency Convertible Bonds) for an amount not exceeding USD 150 million or INR 750 crores, whichever is higher

Promoter/Public No. of shares No. of votes % of Votes No. of Votes No. of Votes % of Votes % of Votesheld polled Polled on in favour against in favour on against on

outstanding votes polled votes polledshares

(1) (2) (3) (4) (5) (6) (7)= [(2)/(1)]*100 = [(4)/(2)]*100 = [(5)/(2)]*100

Promoter and Promoter Group 312943136 289082680 92.38 289082680 0 100.00 0.00

Public - Institutional holders 18200784 18200784 100.00 5047491 13153293 27.73 72.27

Public-Others 653787 471901 72.18 358417 113484 75.95 24.05

Total 331797707 307755365 92.75 294488588 13266777 95.69 4.31

NB - No of shares held includes “B” Equity Shares carrying lower voting rights in respect of both the aforesaid resolutions.

6. Subsidiaries:

As on 31st March 2014, the Company had two Subsidiaries i.e. Manor Dealcom Pvt. Ltd and Huntervalley Coal Pvt. Ltd. The Company is adequately represented on the Board of Subsidiaries. The financial performance of the Subsidiaries is discussed by the Board at its meeting and the details of investment made by and minutes of the unlisted subsidiaries are also reviewed by the Company's Board.

7. Disclosures:

a) Materially significant Related Party Transactions - The Company has not entered into any transactions of material nature, with its promoters, Directors or the Management, its Subsidiaries or with Director's relatives, etc. that may have potential conflict with its interest at large, other than those in the normal course of business. The transactions undertaken during the year have been disclosed in Note No. 33 of Notes to Financial Statements for the year ended March 31, 2014. The Company's major related party transactions are generally with its Subsidiaries and Group Associates. The related party transactions are entered into based on consideration of various business exigencies, synergy in operations, and optimization of market share, profitability, legal requirements, liquidity and capital

resources of Subsidiaries/Associates. All related party transactions are negotiated at arms length basis and in the interest of the Company.

b) Details of Compliance - The Company is regular in complying with the requirements of the regulatory authorities on the matters relating to the Capital market and no penalties/strictures have been imposed on the Company by Stock Exchange or SEBI or any regulatory authority, during last three years.

c) Whistle Blower Policy The Company has a Whistle Blower Policy and appropriate mechanism in place. Employees can directly report to the top most management (including Chairman & Managing Director and/or the members of the Board/Audit Committee) any concerns about any unethical behavior, actual or suspected fraud or violation of the Company's Code of Conduct or Ethics Policy. Management on its turn is responsible for establishing a fearless atmosphere where reporting employee doesn't fear being harassed, demoted or retaliated or threatened in any way and simultaneously receiving, investigating and acting upon complaints and concerns regarding actual/ possible violation of Code of Conduct or an event that could affect the business and/or reputation of the Company and/or

24



its Subsidiaries or its Associates. No personnel of the company have been denied access to the audit committee during the year under review.

d) Non-Mandatory Requirements The Company is duly complying with all the mandatory requirements of Clause 49 of the Listing Agreement with the Stock Exchanges and it has also adopted some of the non-mandatory requirements defined therein such as formation of Remuneration Committee, adoption of best practices to ensure regime of unqualified financial statements, whistle blower policy.

8. Means of Communication:

a) The quarterly, half yearly and yearly financial results of the Company as taken on record and approved by the Board of Directors are published in leading newspapers such as Economic Times (English) in its All India editions and Ei-Somoy (Bengali) in its West Bengal edition.

b) The quarterly, half yearly and yearly financial results are also sent immediately upon conclusion of the meeting approving them, to the Stock Exchange(s) on which the Company's shares are listed.

c) Copies of the financial results and Annual Reports of the Company are provided to various Analysts, Government Departments, Investors and others interested in getting the same upon receipt of requests.

d) The Management Discussion and Analysis is annexed to the report and forms a part of this Annual Report.

e) The quarterly, half yearly and yearly results, press releases and relevant presentations of the Company are d isp layed in the company 's websi te : www.gujaratnre.com.

9. General Shareholders' Information:

a) Annual General Meeting :

Date and Time : Tuesday, 30th day ofSeptember, 2014 at 10:30 a.m.

Venue : Vidya Mandir, 1, Moira Street,Kolkata – 700 017.

b) Financial Year : 12 months from 1st April, 2013to 31st March, 2014

c) Book Closure : Monday, the 18th day ofDate August 2014 to Friday,

22nd day of August 2014 (Both days inclusive).

d) Particulars in respect of Unclaimed dividends paid by the Company for the financial year 2006-07(Final Dividend) and thereafter is given in the following Table:

Financial year Date of declaration Last date of claiming of Dividend unpaid Dividend

2006-07 (Final) 28.09.2007 27.09.2014

2007-08 (Final) 17.09.2008 16.09.2015

2008-09 (Final) 19.09.2009 18.09.2016

2009-10 (Final) 10.09.2010 09.09.2017

2010-11(Final) 30.09.2011 29.09.2018

e) Listing of Equity Shares on Stock Exchanges :

(i) BSE Ltd.

P J Towers, Dalal Street, Fort, Mumbai - 400 001

(ii) National Stock Exchange of India Ltd.

Exchange Plaza, Bandra Kurla Complex, Bandra (E), Mumbai - 400 051

f) Listing Fees:

Annual Listing Fees for the year 2014-15 have been paid to both the Stock Exchanges. The Company has also paid the Annual Custody Fees to both the Depositories for the year 2014-15.

g) Depositories:

i) National Securities Depository Ltd.Trade World, Kamala Mills Compound, Senapati Bapat Marg, Lower Parel,Mumbai - 400 013.

ii) Central Depository Services (India) Ltd.P J Towers, 17th Floor, Dalal Street, Fort,Mumbai - 400 001.

h) Stock Codes:

Equity Shares :

Stock Exchange(s) Stock Code

Bombay Stock Exchange, (BSE) 512579

National Stock Exchange (NSE) GUJNRECOKE

ISIN of equity shares INE110D01013(on both the depositories)

“B” Equity Shares (DVR Shares) :

Stock Exchange(s) Stock Code

Bombay Stock Exchange, (BSE) 570003

National “B” Stock Exchange (NSE) GUJNREDVR

ISIN of “B” equity shares IN9110D01011(on both the depositories)

Non-convertible Debentures quoted only at Bombay Stock Exchange (BSE)

Series Non-convertible Stock Id at Stock ISIN No. at Debentures BSE Code at NSDL

BSE

2nd 11.9% NCD's of Rs. 10 lac each GUJNRE07029 946074 INE110D07044

4th 12.5% NCD's of Rs. 10 lac each GNCL30MAY9A 946143 INE110D07101

6th 12.5% NCD's of Rs. 10 lac each GNCL30MAY9C 946145 INE110D07077

7th 12.5% NCD's of Rs. 10 lac each GNCL30MAY9D 946146 INE110D07085

8th 12.5% NCD's of Rs. 10 lac each GNCL30MAY9E 946147 INE110D07093

9th 11% NCD's of Rs. 10 lac each GUJNRE09039 946671 INE110D07119

10th 10.9%NCD's of Rs. 10 lac each 1090GUJ22 948228 INE110D07127

Warrants issued under Qualified Institutional Placement

ISIN no of Warrants INE110D13018Stock Code at BSE W1-GUJNRECOKEStock Code at NSE W1-GUJNRECOKE

i) Corporate Identification Number (CIN) : L51909WB1986PLC040098

25



j) Market Price Data:

The Market Price of the Equity Shares of the Company during 2013-14 is given in the table below: Equity Shares -

Months BSE NSE

High Low High Low

April 2013 18.30 16.55 18.35 16.55

May 2013 18.05 16.05 18.40 16.00

June 2013 16.50 12.15 16.60 12.10

July 2013 14.98 13.22 15.00 13.20

August 2013 16.00 12.91 15.95 12.90

September 2013 15.75 12.13 15.90 12.00

October 2013 13.98 12.34 14.00 12.30

November 2013 13.59 7.60 13.60 7.60

December 2013 12.35 9.97 11.80 9.90

January 2014 11.83 9.05 11.85 9.05

February 2014 9.73 8.22 9.85 8.25

March 2014 9.00 7.71 9.05 7.70

“B” Equity Shares (DVR Shares) -

Months BSE NSE

High Low High Low

April 2013 9.95 7.55 9.85 8.10

May 2013 9.00 8.00 9.15 8.00

June 2013 8.85 6.70 8.75 6.30

July 2013 7.95 6.20 8.40 6.20

August 2013 6.95 5.03 6.95 5.50

September 2013 7.30 5.02 7.40 5.65

October 2013 6.40 5.30 6.15 5.35

November 2013 6.10 3.52 6.20 3.90

December 2013 6.45 4.82 6.60 4.75

January 2014 6.00 4.55 6.10 4.50

February 2014 4.80 3.50 4.85 3.45

March 2014 4.20 3.10 3.95 3.15

NB-1. Data relating to BSE & NSE has been taken from their respective websites.

Warrants & NCDs There is hardly any trading in listed warrants and NCDs of the Company and therefore, its month-wise market prices are not available.

k) Share Price Performance for

a) Equity Shares as compared to BSE Sensex during 2013-14:

24.00

BS

ES

en

sex

Pri

ce

pe

rs

ha

re

Year 2013-14

Closing Price BSE SENSEX

pil’1

3

Ar

May

’13

Jun’1

3

Jul’1

3 ’Aug

1 3

Sep’13

Oct’13

ov1 3

N’ c

3

De’1

an’ 4

J1Feb

’14

Mar

14’

18.00

12.00

6.00

0.00

24000.00

18000.00

12000.00

6000.00

0.00

b) “B” Equity Shares as compared to BSE Sensex during 2013-14:

NB – Data relating to BSE Sensex and Closing price of Company's Equity Shares & B Equity Shares has been collected from BSE Website.

l) Registrar and Share Transfer Agents:

M/s. Niche Technologies Private Limited,D-511, Bagri Market, 71, B. R. B. Basu Road,Kolkata-700 001Phones: +91-33-22357270/7271Fax: +91-33-22156823E-Mail: [email protected]

m) Designated Exclusive email id : The Company has designated the following email id exclusively for investor servicing : [email protected]

n) Share Transfer System:

All matters pertaining to share transfers are being handled by M/s. Niche Technologies Pvt Ltd., the Registrars & Share Transfer Agents (RTA) of the Company. The share transfer requests received by them are processed and a memorandum of transfer is sent to the Company for approval by the Share Transfer Committee. The company regularly monitors and supervises the functioning of the system so as to ensure that there are no delays and lapses in the system. Shares held in dematerialised form are traded electronically in the Depository. The RTA of the Company periodically receives from the Depository, the beneficial holding so as to enable them to update their records and to send all notices, corporate communications and Dividend Payments etc. to the beneficial owners of shares.

The average time taken for process of share transfer requests including dispatch of share certificates etc. is within 15 days. Physical shares received for dematerialisation are processed and computerised within a period of seven to ten days from the date of receipt, provided they are found in order in every respect. Bad deliveries are immediately returned to the respective Depository Participant under advice to the Shareholders.

Year 2013-14

Closing Price BSE SENSEX

Pri

ce

pe

rs

ha

re

BS

ES

en

se

x

pil’1

3

Ar

May

’13

Jun’

31Ju

l’13 ’Aug

1 3

Sp’e13

Oct’13

Nov’13 c’

3

De1an

’ 4

J1

e14

Fb’

Mar

14’

24.00

18.00

12.00

6.00

0.00

24000.00

18000.00

12000.00

6000.00

0.00

26



o) Shareholding Pattern as on 31st March 2014 are given in the following Table:

Equity Shares -

Category No. of Shares % of Holding

Promoters & Promoter Group 28,82,03,617 50.13

Financial Institutions, Banks, Mutual Funds, etc. 10,26,380 0.18

FIIs (including Foreign Bodies Corporates) 9,75,40,558 16.96

Indian Public (including Private Corporate Bodies) 17,74,58,373 30.87

NRIs/OCBs 56,13,350 0.98

Clearing Members & others 50,37,849 0.88

Total 57,48,80,127 100.00


Category No. of Shares % of Holding

Promoters & Promoter Group 2,41,01,468 45.92

Financial Institutions, Banks, Mutual Funds, etc. 56,766 0.11

FIIs (including Foreign Bodies Corporates) 42,82,116 8.16

Indian Public (including Private Corporate Bodies) 2,34,39,710 44.65

NRIs/OCBs 3,75,818 0.72

Clearing Members & others 2,32,132 0.44

Total 5,24,88,010 100.00

p) Distribution of Shareholding as on 31st March 2014 are given in the following Table :

Equity Shares -

Shareholding Range No. of % of No. of Shares % of Shareholders Shareholders Held Shareholding

1 - 500 1,34,581 74.22 2,31,18,974 4.02

501 - 1000 21,986 12.12 1,73,04,211 3.01

1001 - 5000 20,219 11.15 4,43,76,267 7.72

5001 - 10000 2,630 1.45 1,87,89,397 3.27

10001 - 50000 1,604 0.89 3,09,56,185 5.38

50001 - 100000 155 0.09 1,07,49,352 1.87

100001 - and above 148 0.08 42,95,85,741 74.73

Total 1,81,323 100.00 57,48,80,127 100.00


Shareholding Range No. of % of No. of Shares % of Shareholders Shareholders Held Shareholding

1 - 500 1,18,106 96.91 46,06,805 8.78

501 - 1000 1,736 1.42 12,87,606 2.45

1001 - 5000 1,570 1.29 34,93,125 6.66

5001 - 10000 236 0.19 17,28,815 3.29

10001 - 50000 177 0.15 36,28,422 6.91

50001 - 100000 18 0.01 13,53,193 2.58

100001 - and above 37 0.03 3,63,90,044 69.33

Total 1,21,880 100.00 5,24,88,010 100.00

27



q) Dematerialisation of Shares and Liquidity:

Approximately 99.43% of the Company's Equity Shares and approximately 98.04% of Company's “B” Equity Shares have been dematerialised as on March 31, 2014. The Equity Shares and the “B” Equity Shares of Company are both actively traded in Stock Exchanges and are permitted to be traded only in dematerialised form.

r) Outstanding FCCBs / Warrants / ESOS or any other

Convertible instruments, Conversion date and

likely impact on equity:

The outstanding convertible bonds, warrants and ESOS as on 31st March, 2014 are as under:

– 2,08,00,000 Warrants of Rs.120 each issued under Qualified Institutional Placement with option to the warrant holder to get allotment of 1 Equity Share in lieu of each warrant. The warrant holders have theright to exercise the option for conversion of warrants on or before 28th April, 2015. If all the aforesaid warrants are converted then the Share Capital of the Company will increase by 2,08,00,000 Equity Shares of Rs. 10 each and by20,80,000 “B” Equity Shares of Rs. 10 each.

– 200 Nos. of 5.5% Unsecured FCCB due 2017 with an issue value of USD 1,00,000 each. If all the bonds are converted into equity share at its conversion price, then the Share Capital of the Company will increase by around 4,77,64,444 Equity Shares of Rs.10 each.

– The status on outstanding options under Employee Stock Option Schemes has already been provided in an Annexure to the Directors Report.

s) Plant Location:

Coke Plant(s)

1. Vill. : Dharampur, P.O. KhambhaliaDist. : Devbhoomi Dwarka, Gujarat Pin : 361305

2. Vill. : Lunva, Taluka-BhachauDist. : Kutch, GujaratPin : 370140

3. Road No. 16, 1st Cross, KIADB,Belur Indusrial Area, Dharwad,Karnataka, Pin : 580011

Steel Plant(s)

Vill. : Lunva, Taluka-BhachauDist. : Kutch, GujaratPin : 370140

t) Address of Subsidiaries

Manor Dealcom Private Ltd

22, Camac Street, Block C, 5th Floor, Kolkata 700 016

Huntervalley Coal Private Ltd

22, Camac Street, Block C, 5th Floor, Kolkata 700 016

u) Address for Correspondence:

22, Camac Street, Block - C, 5th FloorKolkata-700 016,Phone: +91-33-22891471Fax: +91-33-22891470E-mail: [email protected]

v) Queries:

Any Query on Financial Statements, Company'sperformance etc. may be sent to [email protected] addressed to the Company.

10. Auditor's Certificate on Corporate Governance

As per Clause 49 of the Listing Agreement, the Auditor's Certificate on Corporate Governance is annexed to this Report.

For and on behalf of the Board

Place : Kolkata Arun Kumar JagatramkaDated : 25th May, 2014 Chairman & Managing Director

28


Auditors' Certificate on Corporate Governance

To the Members of

Gujarat NRE Coke Limited

We have examined the compliance of conditions of Corporate Governance by Gujarat NRE Coke Limited for the year ended on 31st March

2014, as stipulated in clause 49G (iii) of the Listing Agreement of the said Company with the Stock Exchanges.

The compliances of the conditions of the Corporate Governance is the responsibility of the management. Our examination was limited to a

review of the procedures and implementations thereof, adopted by the Company for ensuring the compliance of the conditions of the

Corporate Governance as stipulated in the said clause. It is neither an audit nor an expression of opinion on the financial statements of the

Company.

In our opinion and to the best of our information and according to the explanations given to us, and based on the representation made by the

Directors and the management, we certify that the Company has substantially complied with the conditions of Corporate Governance as

stipulated in the above-mentioned clause of the Listing Agreement.

As required by the guidance note issued by the Institute of Chartered Accountants of India, we state that as per the records maintained,

there were no investors' complaints remaining unattended/pending for more than 30 days as at 31st March 2014.

We further state that such compliance is neither an assurance as to the future viability of the Company nor the efficiency or effectiveness

with which the management has conducted the affairs of the Company.

For N. C. Banerjee & Co.,Chartered Accountants

(Registration No. 302081E)

ARNOB PAULDated : 25th May, 2014 PartnerPlace : Kolkata (Membership No. 06490)

Management Discussion & Analysis

INDUSTRY STRUCTURE & DEVELOPMENTS

ECONOMY

Global economic activities experienced a slight uptick in the secondhalf of 2013 which is expected to follow through in 2014. Thepositive signs first, which came from easing of financial conditionsin advanced countries due to the declining short term risksassociated with crisis hit euro-economies and fiscal adjustments in US economy. However, growth in the emerging economiesremained unenthusiastic with tight financial conditions and lowdemand raising the need for structural reforms and policy impetus.

The global growth in 2014 is expected to be much better than what has been experienced in 2013. The current year is expected to be initiating the revival as we have already seen euro area turning from recession to recovery and the United States catching up the growth momentum. The global economy is expected to grow by 3.4% in 2014 and further by 3.9% in 2015 which would be by far the highest in recent years when compared to 2.8% in 2013, 3.0% in 2012 and 3.4% in 2011 according to an OECD study.

As the developed economies are expected to perform, the emerging economies are also expected to grow, albeit slowly. Chinese growth would almost remain the same at around 7.5% in 2014. In India growth is expected to be stronger in the latter half of 2014 moving into 2015. According to a World Bank report, Indian economy is expected to grow at around 5.5% in fiscal 2014-15, accelerating to 6.3% in 2015-16 and 6.6% in 2016-17. Strong structural policies supporting investment is expected to result in an improvement in Indian growth in later half of 2014 and in 2015 compared to the weak performance experienced in last few years. The biggest challenge for the new government is to address the ease of doing business in the country and to revive the business sentiment which has been at its low. Among other issues, continued fiscal consolidation, fast track implementation of large infrastructure projects and investments, tax reforms would be some of the priority areas for the country.

The biggest challenge that policy makers world over face is supporting robust growth and a balanced global recovery as well as managing vulnerabilities and sustaining the job market. Thepolicy makers need to have a coordinated approach to mitigateany negative spill-over, curb protectionism, ensure resource flow to the developing and emerging economies to avoid derailment of the feeble recovery that the world is currently experiencing. The developing economies need to aggressively address their structural issues to boost domestic demand, facilitate investmentand take benefit of the growing market in the developed countries. External factors like the crisis in Ukraine, tension in middle-east, or a bad monsoon in India may tilt the scales of thefragile recovery.

WORLD COKING COAL AND METALLURGICAL COKE INDUSTRY

Metallurgical coke prices have been on a continuous fall and have been below the lows of 2009. There has been a sharp decline in price in 2013-14 as experts belief that there is no further room for rate cut as the price seems to have been bottomed out. With the removal of export tax by China from January 2013, Chinese coke is available to Indian, Japanese and Brazil markets. The export prices since then have also been greatly dependent on the domestic coke price of China. However the biggest concern in the global coke market has been the lack of demand. Stagnation of growth in India coupled with slowdown in growth in China has led to absence of demand resulting in the prices stumbling.

There exists a strong correlation between coking coal and metallurgical coke. Coking coal prices have also been on a steep

fall from the highs of $330 per tonne in 2011 to $120 per tonne in 2014. The long drawn recession in the global market has led to a lack of demand of coking coal. Low demand and weak sentiments had been the trademark of the Asian coking coal market. Chinese steel mills not buying on the back of high inventory and lack of demand from Indian and Japanese market coupled with coking coal from USA and Canada available cheap in Asian markets have kept the price of coking coal at its bottom.

The expectation of a revival in the global economy does come with a silver lining. It is believed that Indian demand is going to increase in the latter half of 2014 as also demand in developed and other emerging countries expected to pick up. Also in the supply side, recent production cuts in Canada, Australia and the US were finally visible in the Chinese spot market recently with fewer cargoes being on offer presently than before. With such supply side corrections and increase in demand as steel production picks up, the coking coal market is expected to see a revival in the months to come. Experts believe that the coking coal market might see a revival in the latter half of 2014 with prices increasing.

DOMESTIC MET COKE INDUSTRY

Indian economy has been passing through one of its challenging times for last couple of years. Manufacturing sector is suffering on account of lack of domestic demand and consumption, infrastructure projects failing to take off and over all a weak business sentiment had been the characteristics of Indian economy in the last year. Indian steel mills have been looking for the export market buoyed by a favourable exchange rate, due to absence of a robust domestic demand. Lack of steel consumption resulting into lower growth in steel production had a direct effect on the demand for coking coal and met coke in India. Met coke production remained almost the same as in last year (2012-13) with no increase in imports as well.

There is an expectation of a turnaround in the Indian economy from end of 2014 and into 2015. An expectation of return of the feel good factor is palpable in the air as better economic conditions coupled with accelerating global outlook is expected to return in Indian economy in the latter half of 2014. With economy expected to return stronger growth steel demand is expected to be higher to around 5% in the year 2014-15 and potentially 10% in 2015-16. Leading steel producers in India expect to raise production with steel prices to remain stable in 2014, thus overall domestic steel demand will grow faster with economic revival.

Increase in steel demand would certainly raise the demand for met coke. Met coke price in the domestic market is expected to strengthen with increasing demand. It is expected that there would be potentially an additional shortfall of around 1.5-2 MT of met coke going forward in 2015 which would have to be met by merchant coke producers or through imports.

OPPORTUNITIES & THREATS

The biggest opportunity lies in the growing middle class in India and in its burgeoning demand. The ever growing challenge of meeting the incremental domestic demand is bound to fuel growth. Indian growth being based on internal consumption does not have to depend on external economies for selling its product. Though no country can insulate itself from the global shocks in today's liberalised economy, however the growth here is more sustainable. The formation of a stable government at the centre also raises hope of structural reforms and policy corrections required for faster growth of the economy. With the revival in global economy, demand multiplies, and since prices will not remain subdued for long, the met coke industry has a host of opportunities.


29

Various external factors like global recession, eurozone crisis act as major threats to the met coke & coking coal industry as it does to any other commodity market. The extreme volatility in price adds to the uncertainty. Certain unexpected international & domestic developments like the abolition of 40% export tax by China or the imposition of mining ban in South India are a few threats facing the industry.

COMPANY'S PERFORMANCE

The income from operations was lower at Rs.932.38 crores in the year under review as compared to Rs.1713.04 crores during the previous year and consequently, the net loss during the year under review was reported at Rs. 560.81 crores as compared to net profit of Rs. 30.98 crores during the previous year. Accordingly, both the Basic & Diluted earnings per share of the Company were reported at nil respectively, for the year under review as compared to Rs.0.52 respectively, during the previous year.

SEGMENT WISE PERFORMANCE & OUTLOOK

Coal & Coke

Coking coal and Coke segment has been at the core of the operations of the Company contributing around 90% of the total turnover during the year under review. Net Sales/income from this segment for the year under review amounted to Rs. 832.74 crores as compared to Rs.1495.74 crores in the previous year.

Steel

Steel segment contributes around 10% to the total turnover. It achieved a turnover of Rs. 99.68 crores during the year under review as compared to Rs.217.63 crores during previous year.

The Company is generating power through its Wind Turbines and is in the final stages of commissioning co-generation power plants to produce electricity from waste heat. This would help the Company to reduce its power costs and ensure regular supply of clean power to its production facilities.

Outlook

The market conditions are expected to remain volatile during 2014-15. However, we are seeing early signs of some hope of revival in the general economic & market conditions considering the formation of new government at the Centre. Any uptrend in economic activity would pull the prices up the curve with increased market activity & demand. The prices of coking coal and metcoke are believed to have been bottomed out with minimal downside risk, and any further movement is expected to move upwards.

RISKS & CONCERNS

Our businesses and operations are subject to a variety of risks and uncertainties which are similar to any other company in general and also common to the industry to which we belong. Some of the key risks and uncertainties affecting the company are set forth below. Any of these risks has the potential of causing the actual operating results in future to vary materially from the current results or from anticipated future results.

a) Commodity Price Risk : The Company is exposed to the risk of price fluctuations on raw materials and finished goods. However, considering the normal correlation in the prices of raw material i.e coking coal and finished good i.e. met coke, this risk gets reduced / adjusted over a period of time.

b) Production Risk : Coking coal, the critical raw material required for manufacture of met coke is in short supply internationally resulting in uncertainty in its availability and

consequently, its prices. Timely availability of raw material at reasonable prices is therefore, critical for survival in this industry.

c) Forex Risk : The company like any other company operating in global markets is subject to Forex Risk. The Company however, has a policy to hedge its foreign exchange risk within the defined parameters. However, such hedging does not assure avoidance of any losses due to sudden and/or substantial volatility in currency markets.

d) Risk from Natural Calamities: Any act of nature detrimental to the smooth functioning of production of metallurgical coke in India, can adversely affect the performance of the Company.

e) Political Risk : Any risk arising due to any major change in policy decisions on account of change in Government, Legislative bodies etc. such as levy of any additional duty etc. on the product produced by the company may affect the results of the company.

INTERNAL CONTROL SYSTEMS AND ITS ADEQUACY

The Company's internal control systems are commensurate with the nature, size and complexities of its business and ensure proper safeguarding of assets, maintaining proper accounting records and providing reliable financial statements.

The Company has an internal audit system which is conducted by an independent firm of Chartered Accountants as well as a strong in house internal audit cell so as to cover various operations on regular basis through the year. Summarised Internal Audit Observations/ Reports are reviewed by the Audit Committee on a regular basis. The finance and accounts functions of the Company are well staffed with qualified and experienced members.

HUMAN RESOURCES

The company considers its people as its most important resource. All employees of Gujarat NRE are considered leaders and encouraged to take responsibility to do their best that they can while meeting business needs. Our strength lies in our human pool of resources and our success is largely dependent on them. The Company therefore, focuses on developing its talent pool and its employee capability through increased emphasis on learning and skill upgradation job rotation, multi skilling and inter plant sharing of experiences. Critical skills identification and ramp up planning continues at the operating level. The Company continuously reviews its policies/practices with a view to make them more contemporary and uniform in application and this is an ongoing process. To improve quality of work life, medical, transport facilities, welfare and recreational facilities have been reviewed and upgraded. All these efforts had an impact on reducing the attrition levels at our plants and offices. Cordial industrial relations prevailed across the Company and its subsidiaries during the year under review.

CAUTIONARY STATEMENT

The statement in this Management Discussion and Analysis Report describing the company's objectives, projections, estimates, expectations or predictions may be 'forward-looking statement' within the meaning of applicable securities laws and regulations. These statements being based on certain assumptions and expectations of future events, actual results could differ materially from those expressed or implied. The Company assumes no responsibility whatsoever, in this regard.

Management Discussion & Analysis (contd.)


30

Managing Director (CEO) & Chief Financial Officer (CFO) Certification

We, Mr. Arun Kumar Jagatramka, Chairman & Managing Director and Mr. P R Kannan, Chief Financial Officer certify that:

1) We have reviewed the Financial Statements and the Cash Flow Statements for the year ended 31st March 2014 and to the best of our knowledge and belief :

a) These statements do not contain any materially untrue statement or omit any material fact or contain statements that might be misleading;

b) These statements together present a true and fair view of the company's affairs and are in compliance with existing Accounting Standards, applicable laws and regulation.

2) To the best of our knowledge and belief, no transactions entered into by the company during the year, which are fraudulent, illegal or violative of the company's code of conduct.

3) We accept responsibility for establishing and maintaining internal controls for financial reporting and that we have evaluated the effectiveness of internal control systems of the company pertaining to financial reporting. We have disclosed to the Auditors and the Audit Committee, any deficiencies in the design or operation of such internal controls of which we are aware and the steps that have already been taken or proposed to be taken to rectify these deficiencies.

4) We have disclosed based on our most recent evaluation, wherever applicable, to the Company's Auditors and the Audit Committee that -

a. there has not been any significant change in internal control over financial reporting during the year under reference;

b. there has not been any significant change in the accounting policies during the year requiring disclosure in the notes to the financial statements; and

c. we are not aware of any instance during the year of any significant fraud with involvement therein of the management or any employee having a significant role in the company's internal control system over financial reporting.

5) We further declare that all board members and senior management personnel have affirmed compliance with the Code of Conduct during the year under review.

A K Jagatramka P R KannanPlace : Kolkata Chairman & ChiefDate : 25th May, 2014 Managing Director Financial Officer

Independent Auditors' Report on Abridged Financial Statements

To the members of

Gujarat NRE Coke Ltd.

The accompanying abridged financial statements, which comprise the abridged balance sheet as at 31 March, 2014, the abridged statement of profit & loss, and abridged cash flow statement for the year then ended, and related notes, are derived from the audited financial statements of Gujarat NRE Coke limited ('the Company') for the year ended 31 March, 2014.

The abridged financial statements do not contain all the disclosures required by the Accounting Standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956 (“the Act”) applied in the preparation of the audited financial statements of the Company. Reading the abridged financial statements, therefore, is not a substitute for reading the audited financial statements of the Company.

Management's Responsibility for the Abridged Financial

Statements

Management is responsible for the preparation of a summary of the audited financial statements in accordance with Rule 7A of the Companies (Central Government's) General Rules and Forms, 1956 read with Companies (Central Government's) General Rules and Forms (Amendment) Rules, 2012 and are based on the audited financial statements for the year ended 31 March, 2014, prepared in accordance with Accounting Standards referred to in

sub-section (3C) of section 211 of the Companies Act, 1956 (“the Act”) and accounting principles generally accepted in India.

Auditors' Responsibility

Our responsibility is to express an opinion on the abridged financial statements based on our procedures, which were conducted in accordance with Standard on Auditing (SA) 810, “Engagements to Report on Summary Financial Statements” issued by the Institute of Chartered Accountants of India.

Opinion

In our opinion, the abridged financial statements, prepared in accordance with Rule 7A of the Companies (Central Government's) General Rules and Forms, 1956 read with Companies (Central Government's) General Rules and Forms (Amendment) Rules, 2012 are derived from the audited financial statements of the Company for the year ended 31 March, 2014 and are a fair summary of those financial statements.

For N.C.Banerjee & Co.Chartered Accountants

(Firm’s Registration No. 302081E)

A. PaulPlace : Kolkata (Partner)Date : 25th May, 2014 Membership No. 06490


31

Independent Auditors’ Report

To the members of Gujarat NRE Coke Ltd.

Report on the Financial Statements

We have audited the accompanying financial statements of Gujarat NRECoke Limited (“the Company”), which comprise the Balance Sheet as at March 31, 2014, the Statement of Profit and Loss and Cash Flow Statement for the year then ended and a summary of significant accounting policies and other explanatory information.Management's Responsibility for the Financial Statements

Company's Management is responsible for the preparation of these financialstatements that give a true and fair view of the financial position, financialperformance and cash flows of the Company in accordance with theAccounting Standards, notified under the Companies Act, 1956 (the Act) readwith the General Circular 15/2013 dated 13th September, 2013 of the Ministryof Corporate Affairs in respect of Section 133 of the Companies Act, 2013 andin accordance with the accounting principles generally accepted in India. Thisresponsibility includes the design, implementation and maintenance of internalcontrol relevant to the preparation and presentation of the financial statementsthat give a true and fair view and are free from material misstatement, whetherdue to fraud or error.Auditor's Responsibility

Our responsibility is to express an opinion on these financial statementsbased on our audit. We conducted our audit in accordance with theStandards on Auditing issued by the Institute of Chartered Accountants of India. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether thefinancial statements are free from material misstatement.An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considersinternal control relevant to the Company's preparation and fair presentation of the financial statements in order to design audit procedures that areappropriate in the circumstances, but not for the purpose of expressing anopinion on the effectiveness of the Company's internal control. An audit alsoincludes evaluating the appropriateness of accounting policies used and thereasonableness of the accounting estimates made by management, as wellas evaluating the overall presentation of the financial statements.We believe that the audit evidence we have obtained is sufficient andappropriate to provide a basis for our audit opinion.Opinion

In our opinion and to the best of our information and according to theexplanations given to us, the aforesaid financial statements give theinformation required by the Act, in the manner so required, and give a true

and fair view in conformity with the accounting principles generally accepted in India:(a) in the case of the Balance Sheet, of the state of affairs of the

Company as at March 31, 2014;(b) in the case of the Statement of Profit and Loss, of the loss of the

Company for the year ended on that date; and(c) in the case of the Cash Flow Statement, of the cash flows of the

Company for the year ended on that date.

Report on Other Legal and Regulatory Requirements

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

2. As required by section 227(3) of the Act, we report that:a) we have obtained all the information and explanations which

to the best of our knowledge and belief were necessary for the 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 appears from our examination of those books;

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

d) in our opinion, the Balance Sheet, Statement of Profit and Loss and Cash Flow Statement comply with the Accounting Standards notified under the Act read with the General Circular 15/2013 dated 13th September, 2013 of the Ministry of Corporate Affairs in respect of Section 133 of the Companies Act, 2013;

e) on the basis of written representations received from the directorsas on March 31, 2014, and taken on record by the Board ofDirectors, none of the directors is disqualified as on March 31,2014, from being appointed as a director in terms of clause (g) ofsub-section (1) of section 274 of the Act;

f) Since the Central Government has not issued any notification as to the rate at which the cess is to be paid under section 441A of the Companies Act, 1956 nor has it issued any Rules under the said section, prescribing the manner in which such cess is to be paid, no cess is considered due and payable by theCompany as on 31.03.2014.


(Firm’s Registration No. : 302081E)

A. PaulPlace : Kolkata (Partner)Dated : 25th May, 2014 Membership No. 06490

(i) (a) The Company has maintained proper records showing full particulars, including quantitative details and situation of fixed assets.

(b) We were informed that the Company has a phased programme of physical verification of all its fixed assets which, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. In accordance with this programme, fixed assets were physically verified by management during the period under review and no material discrepancy was noticed on such verification.

(c) Fixed assets disposed off during the year under review were not substantial and the going concern status of the company is not affected.

(ii) (a) During the year inventories have been physically verified by the management at reasonable intervals. In our opinion, the frequency of verification is reasonable.

(b) In our opinion and according to the information and explanations given to us, the procedures of physical verification of inventories followed by the management are reasonable and adequate in relation to the size of the Company and the nature of its business.

(c) The Company has maintained proper records of inventory. We were explained that the discrepancies noticed during the physical verification of inventories as compared to book records were not material and have been properly dealt with in the books of account.

(iii) In our opinion and according to the information and explanations given to us, the company has not granted or taken loans, Secured or Unsecured, to/from the companies, firm or other parties covered in the Register maintained under section 301 of the Companies Act, 1956, consequently sub clauses (a) to (g) of clause (iii) of paragraph 4 of the order is not applicable to the company.

(iv) In our opinion and according to the information and explanations given to us, there exists an adequate internal control system commensurate with the size of the company and the nature of its business with regard to purchases of inventory and fixed assets and with regard to the sale of goods and services. No major continuing weakness in internal control system was observed.

(v) (a) According to the information and explanations given to us, we are of the opinion that particulars of all the transactions made in pursuance of contracts or arrangements referred to in section 301 of the Companies Act, 1956 have been entered in the register required to be maintained under that section.

Annexure to Independent Auditor's ReportReferred to in Paragraph 1 under the heading “Report on Other Legal and Regulatory Requirements” of our report of even date


32

Independent Auditors’ Report (contd.)

(b) In our opinion and according to the information and explanationsgiven to us, the transactions made in pursuance of contracts orarrangements entered in the register maintained under section301 of the Companies Act, 1956 and exceeding value of rupeesfive lacs in respect of each party during the year have beenmade at prices which appear to be reasonable having regard toprevailing market prices at the relevant time.

(vi) According to the information and explanations given to us, theCompany has not accepted any deposits from the public andconsequently, the directives issued by the Reserve Bank of India andthe provisions of Section 58A, 58AA or any other relevant provisions ofthe Companies Act, 1956 and the rules framed there under are notapplicable to the Company.

(vii) In our opinion, the Company has an internal audit systemcommensurate with the size and the nature of its business but it has tobe further strengthened.

(viii) We have broadly reviewed the cost records maintained by thecompany pursuant to the Companies (Cost Accounting Records)

Rules, 2011 prescribed by the Central Government under Section 209(1) (d) of the Companies Act, 1956 and are of the opinion that prima facie the prescribed cost records have been maintained. Wehave, however, not carried out a detailed examination of suchrecords, nor we are required to do so, with a view to determine whether they are accurate or complete.

(ix) (a) According to the information and explanations given to us and on the basis of our examination of the books of account, the Company has been regular in depositing undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, Employees' State Insurance, Wealth Tax, Customs Duty, Excise Duty, Cess and any other material statutory dues except Income Tax, Sales Tax and Service Tax where the amount has not been regularly deposited with the appropriate authorities and there has been delays in a large number of cases.The Central Government has not notified the date of levy and collection of cess under Rehabilitation & Revival Fund as per section 441 A of the Companies act, 1956.

(x) The Company does not have accumulated losses more than 50% of the networth of the Company as at 31st March, 2014. The Company has incurred cash losses during the year under review, there was no cash losses in the immediately preceding financial year.

(xi) The Company has defaulted in repayment of dues to banks andfinancial institutions in respect of Letters of Credit, Buyer's Credit, Bills

Discounting, Term Loan Installments, NCD installments and Interest.However during the year, the CDR proposal of the Company has beenapproved by the CDR Empowered Group (CDR EG) at its meeting heldon 14th March 2014. As per approved CDR package, defaults duringthe year with CDR lenders have been regularised, except the followingdefaults which are existing/continuing as on the Balance sheet date.

(b) According to the information and explanations given to us, no undisputed amount payable in respect of Income Tax, Sales Tax, Wealth Tax, Service Tax, Custom duty and Excise duty were in arrear as at 31st March, 2014, for a period of more than six months from the date those became payable, except for the Sales Tax/VAT/CST and Income Tax as given below:-

Name of the statute Nature of Dues Amount (Rs./Crores)

Gujarat Value Added Tax Act, 2003 Sales Tax/VAT/CST 11.18

Income Tax Act,1961 Income Tax 5.92

(c) According to the information and explanations given to us and the records of the company examined by us, there were no dues in respect of Income Tax, Sales Tax, Wealth Tax, Service Tax, Customs Duty, Excise Duty and Cess that have not been deposited with the appropriate authorities other than disputed liabilities mentioned below:-

Name of the statute Nature of Amount Period to which the Forum whereDues (Rs./Crores) amount Relates disputes are pending

Income Tax Act, 1961 Regular Assessment 1.86 2006-07 Commissioner of Income Tax2010-11 (Appeals), Kolkata

Finance Act, 1994 Service Tax 3.39 2007-08 Custom, Excise and Service Tax(Act 32 of 1994) - to Appellate Tribunal, Ahmedabad.Chapter V & VA 2011-12 Commissioner (Appeals),

Cental Excise, Rajkot

The Customs Act, 1962 Custom Duty 12.50 2004, 2005, 2007, Custom, Excise and Service Tax2008, 2010 Appellate Tribunal, Ahmedabad.


33

(xii) According to the informations and explanations given to us, theCompany has not granted loans and advances on the basis of securityby way of pledge of shares, debentures and other securities.

(xiii) In our opinion and according to the information and explanations givento us, the Company is not a chit fund / nidhi / mutual benefit fund /society. Therefore, the provisions of clause (xiii) of paragraph 4 of theorder are not applicable to the company.

(xiv) According to the information and explanations given to us, theCompany is not dealing or trading in shares, securities, debentures andother investments. The investments have been held by the company inits own name except to the extent of exemption, if any, granted undersection 49 of the Companies Act, 1956.

(xv) In our opinion and according to the information and explanations givento us, the terms and conditions, on the basis of which the Company hasgiven guarantees for loans taken by the erstwhile subsidiarycompanies from banks or financial institutions, are not as such primafacie prejudicial to the interests of the Company.

(xvi) In our opinion and according to the information and explanations given tous and on the basis of our examination of the books of account, the termloans were applied for the purpose for which such loans were obtained.

(xvii) According to the information and explanations given to us and on anoverall examination of the balance sheet of the Company, we report thatno funds raised on short-term basis were used for long term investment.

(xviii) The company, during the year, has allotted equity shares onpreferential basis consequent upon conversion of Share warrantsallotted to a company covered in Register maintained under Section301 of the Companies Act,1956. The Price at which these shares havebeen issued has been determined as per Securities and ExchangeBoard of India (Disclosure and Investor Protection) Guidelines 2000,which, in our opinion, is not prejudicial to the interest of the Company.

(xix) The company has not issued any debentures or bonds during the yearunder review.

(xx) The company has not raised any money by way of public issues duringthe year under review.

(xxi) Based upon the audit procedures followed for the purpose of reportingon the true and fair view of the financial statements and as per theinformation and explanations given by management, no fraud on or bythe Company has been noticed or reported during the year.


(Firm’s Registration No. : 302081E)

A. PaulPlace : Kolkata (Partner)Dated : 25th May, 2014 Membership No. 06490

Amount (Rs. in Crs)

Particulars Delays up to 30 days Delays 31 - 90 days Delays 91 -180 days Delays beyond 180 days Total Amount

Installments/ Overdrawing 0.25 14.12 0.28 — 14.65Interest liabilities 3.70 9.63 1.93 9.96 25.22

Abridged Balance Sheet as at 31st March, 2014

(Statement containing salient features of Balance Sheet as per Section 219(1)(b)(iv) of Companies Act,1956)(Rs. in Crores)

PARTICULARS As at As at 31.03.2014 31.03.2013

i. EQUITY AND LIABILITIES

(1) Shareholders' Funds

(a) Paid up Share Capital

(i) Equity & “B” Equity Share Capital 627.37 622.37

(b) Reserves & Surplus

(i) Capital Reserve 144.87 144.87(ii) Surplus (538.06) –(iii) Securities Premium Reserve 501.27 495.73(iv) General Reserve 251.25 240.45(v) Debenture Redemption Reserve 196.57 196.57(vi) Employee Stock Option Outstanding 6.31 562.21 7.10 1,084.72

(c) Deposit against Share Warrants 10.40 13.04

(2) Non- Current Liabilities

(i) Long-term borrowings 1,963.91 952.81(ii) Long-term provisions 8.30 1,972.21 9.08 961.89

(3) Current Liabilities

(i) Short-term borrowings 749.47 813.53(ii) Trade Payables 209.65 749.99(iii) Other Current Liabilities 278.19 580.23(iv) Short-term provisions 9.65 1,246.96 43.11 2,186.86

Total of (1) to (3) 4,419.15 4,868.88

ii. ASSETS :

(4) Non- Current Assets

(a) Fixed Assets

(i) Tangible Assets (Original cost less depreciation) 898.80 899.83(iii) Capital Work-in-Progress 183.26 1,082.06 204.42 1,104.25

(b) Non-Current Investments

(i) Quoted (Market Value-Rs.43.08 Cr. P.Y-Rs.97.45 Cr.) 55.66 55.66(ii) Unquoted 864.37 920.03 762.73 818.39

(c) Long-term loans & advances 72.79 268.21

(d) Deferred Tax Assets/(Liabilities) (net) 112.34 (160.98)

(5) Current Assets

(a) Inventories 977.52 1,731.46

(b) Trade Receivables 476.62 562.71

(c) Cash & Cash Equivalents

Balances with Bank 33.02 98.43Cash in hand 0.16 33.18 0.25 98.68

(d) Short term loans & advances 744.61 446.16

Total of (4) to (5) 4,419.15 4,868.88

Refer Notes forming part of the Abridged d Accounts

The Complete set of Balance Sheet, Statement of Profit & Loss, other statements and notes thereto prepared as per the requirements of Schedule VI of the Companies Act,1956 are available at the Company's Website at www.gujaratnre.comCompiled from the Audited Accounts of the Company referred to in our Report dated 25th May, 2014.

For N. C. BANERJEE & CO. For and on behalf of the BoardChartered Accountants(Firm Registration No. 302081E)

A. Paul A K Jagatramka M Jagatramka P R Kannan Manoj K ShahPartner Chairman & Director Chief Financial Officer Company SecretaryMembership No. 06490 Managing DirectorPlace : KolkataDated : 25th May, 2014.


34

Abridged Statement of Profit & Loss for the year ended 31st March, 2014

(Statement containing salient features of Statement of Profit & Loss as per Section 219(1)(b)(iv) of Companies Act,1956 )

(Rs.in Crores)

PARTICULARS For the year ended For the year ended31.03.2014 31.03.2013

I INCOME

Sales 970.21 1,821.19

Less: Excise Duty 37.83 932.38 108.15 1,713.04

II Other Income 318.26 38.90

III Total Income (I+II) 1,250.64 1,751.94

IV EXPENDITURE

(a) Cost of material Consumed 854.25 1,077.84

(b) Purchse of Stock in Trade 409.49 139.89

(c) Changes in Inventories of Finished Goods,

Stock-in-Process and Stock in Trade 211.47 (101.47)

(d) Employees Benefits Expenses 44.08 60.27

(e) Finance Cost 331.40 263.02

(f) Depreciation 61.30 58.33

(g) Other Expenses 125.58 159.84

Total Expenditure (a to g) 2,037.57 1,657.72

V Profit/(Loss) before Exceptional Items & Tax (III-IV) (786.93) 94.22

VI Exceptional Items 47.47 47.95

VII Profit/(Loss) Before Tax (V-VI) (834.40) 46.27

VIII Tax Expenses

Current Tax – 9.26

Deferred Tax (273.32) (5.04)

MAT credit entitlement – 10.80

Tax for Earlier Years (0.27) (273.59) 0.27 15.29

Profit/(Loss) after Tax for the year (VII - VIII) (560.81) 30.98

Earnings per Equity & "B" Equity Share (In Rs.)

(Face Value of Rs.10 per Share)

Basic (8.95) 0.52

Diluted (8.95) 0.52

Refer Notes forming part of the Abridged Accounts

Compiled from the Audited Accounts of the Company referred to in our Report dated 25th May, 2014.




35

Notes to Abridged Financial Statements

1 All amounts in the financial statements are presented in Rupees Crores, unless otherwise stated. The note numbers appeared in the "[ ]"are as they appear in the complete set of Financial Statements. These abridged financial statements have been prepared in accordancewith the requirement of Rule 7 A of Companies (Central Government's) General Rules & Forms,1956 and clause 32 of the ListingAgreement. These abridged financial statements have been prepared on the basis of the complete set of financial statements of the yearended March31,2014

2 [25] Segment Informations:

Segment wise Revenue, Results and Capital Employed for the Year ended 31st March,2014.

The Company has two reporting segments i.e. "Coal & Coke" and " Steel" as primary segments.

i Primary Segment Reporting (by Business Segment): (Rs. in Crores)

Particulars 2013-14 2012-13

Coal & Coke Steel Total Coal & Coke Steel Total

Segment Revenue

(Net Sales/Income from segment)

External Sales 832.75 99.63 932.38 1495.74 217.30 1713.04

Inter-Segment Revenue 0.05 0.05 0.33 0.33

832.75 99.68 932.43 1495.74 217.63 1713.37

Less: Inter Segment Revenue 0.05 0.05 0.33 0.33

Total Segment Revenue 832.75 99.63 932.38 1495.74 217.30 1713.04

Segment Results

Profit / (Loss) before Tax & Interest (755.31) (30.56) (785.87) 317.12 (16.68) 300.44

Add:- Other Un-allocable Income Net of Expenditure 282.86 8.85

Less:- Interest Expense 331.39 263.02

Less:- Provision for Tax (273.60) 15.29

Net Profit / (Loss) (560.80) 30.98

Assets

Segment Assets* 2,463.28 449.88 2913.16 3,461.01 484.41 3945.42

Un-allocable Assets 1390.22 1083.16

Total Assets 4303.38 5028.58

Liablities

Segment Liablities 354.74 31.67 386.41 922.49 44.91 967.40

Un-allocable Liablities 94.91 50.62

Total Liablities 481.32 1018.02

*including captive windmills 5.65 318.12 6.54 343.30

Capital Expenditure 44.52 7.33 64.23 1.83

Non Cash Expenses

Depreciation & Amortisation 30.87 29.98 28.17 29.72

ii Secondary Segment Reporting (by Geographical demarcation): (Rs. in Crores)


India Rest Total India Rest Totalof the of the World World

Segment Revenue 932.38 – 932.38 1,548.10 164.94 1,713.04

Segment Assets 2,913.16 – 2,913.16 3,945.42 – 3,945.42

Capital Expenditure 51.85 – 51.85 66.06 – 66.06


36

3. [27] a) Debt Restructuring:

During the year, the Company was referred to the Corporate Debt Restructuring (CDR) Cell, a non statutory voluntary mechanism set up under the aegis of Reserve Bank of India. Pursuant to that a Corporate Debt Restructuring (CDR) Package as recommended by State Bank of India, the lead banker has been approved by the CDR empowered Group (CDR EG) at its meeting held on 14th March 2014 and communicated vide Letter of Approval dated 22nd March 2014 as amended/modified vide letter dated 7th April 2014.

The key features of the approved CDR Package are as follows:

a) The Cutoff date under the CDR package is 01st August 2013.

b) The tenure of existing NCDs and Term Loans aggregating to Rs. 1020.69 Crores has been revised to 10 years from the cut - off date with a moratorium of 2 years. The repayment shall be in 32 quarterly installments from 1st August 2015. The revised applicable interest rate shall be initially 10.75% p.a. and gradually being stepped upto 11.65% p.a.

c) Conversion of various irregular/devolved portion of working capital facilities into Working Capital Term Loan (WCTL) of 10 years repayable after a moratorium of 2 years from the cut off date in 32 quarterly installments from 1st August 2015. The applicable interest rate shall be initially 10.75% p.a. and gradually being stepped upto 15.00% p.a.

d) Interest on existing Term Loan, NCDs and WCTL for the period from 1st August 2013 to 31st July 2015 and Interest on Working Capital outstanding for the period from 1st August 2013 to 31st March 2014 will be funded and converted into Funded Interest Term Loan (FITL) of 10 years repayable after a moratorium of 2 years from the cut off date in 32 quarterly installments from 1st August 2015. The applicable interest rate shall be initially 11.00% p.a. gradually being stepped upto 15.00% p.a.

e) Additional Term Loan I of Rs. 450 Crores for meeting long term working capital needs of the company to be provided by 3 working capital CDR lenders and 2 working capital Non CDR lenders. The repayment shall be in 32 quarterly installments from 1st August 2015. The applicable interest rate shall be initially 11.00% p.a. and gradually being stepped upto 11.50% p.a.

f) Additional Term Loan II of Rs. 50 Crores to part finance the capital expenditure for completing the Waste HeatRecovery Based Power plant (Phase I & II) at Dharwad, Karnataka. The repayment shall be in 32 quarterly installments from 1st August 2015. The applicable interest rate shall be initially 10.75% p.a. and gradually being stepped upto 11.65% p.a.

g) Need based working capital requirement assessed for FY 2014-15 of Rs. 650 Crores(Fund Based) and Non fund based limit of Rs. 425 Crore (LC/LOU of Rs. 400 Crores and Bank Guarantee of Rs. 25 Crores). The rate of interest on fund based limits shall be @ 11% p.a.

h) Waiver of penal interest and all other charges from the cut - off date.

i) Non levy/waiver/refund of liquidated damages/penal interest/penal charges for delay/ irregularities due to lenders/creation of security from the cut off date.

j) Right of Recompense to CDR lenders for the relief and sacrifice extended, subject to provisions of CDR guidelines.

k) Contribution of Rs. 51.50 Crores in the company by promoters towards lenders' sacrifice. In addition, Promoters will also bring in Rs. 20 Crores as their margin/ Contribution for the Waste Heat Recovery Based Power Plant.

b) Status of Implementation of CDR Package:

Sanctions under the CDR package have been received from 13 out of 15 CDR lenders. The CDR package has partially been implemented by 12 CDR lenders. However, as the CDR package has been approved by super majority of the CDR lenders as per RBI guidelines, debt owing to all the CDR lenders have been reclassified and interest has been recalculated in accordance with the CDR package. The above reclassifications and interest calculations are subject to reconciliation and approval by these lenders.

In terms of the provisions of the CDR package, ICICI Bank Limited on 31/03/2014 has converted its existing Term Loan facilities of Rs. 95.67 crores to FCNRB loan of US$ 15.94 million at the interest rate of 3 months LIBOR+5.00% p.a..

In terms of the provisions of the CDR package, ICICI Bank Limited has requested to convert a sum of Rs. 13.39 crores (part of FITL interest) into fully paid up equity shares of Rs.10/- each. The price based on the terms of SEBI (Issue of Capital and Disclosures requirements) Regulations 2009 has been taken at Rs. 11.01 per share. The said amount has been adjusted with the FITL account of ICICI Bank Ltd and transferred to Advance against Share application money Account. The Bank shall be issued 121.61 lacs equity shares of Rs. 10 each at a premium of Rs. 1.01 per share.

The aggregate present value of the outstanding sacrifice made/to be made by CDR lenders as per the approved CDR package is estimated at Rs. 342.39 Crores.

37


Notes to Abridged Financial Statements

Notes to Abridged Financial Statements (contd.)

4 [28.1] Contingent liabilities not provided for in respect of: (Rs. in Crores)

As on As on31st March 31st March

2014 2013

i Letter of Credits outstanding for purchase of materials. – 1.16

ii Outstanding Bank Guarantees and Counter / Corporate Guarantees given on behalf of subsidiary companies. 2,893.29 2,667.05

iii Capital commitments 58.08 59.17

iv Bills discounted under letter of credit with banks 13.36 41.89

v Duty on account of Advance Authorisation against Export obligation. 4.87 4.87

vi On Balance Sheet date, the disputed amount involved in four income-tax demands(Previous Year four) under appeal. The management is of view that the outcome ofthe appeal would be favourable to the company, hence no provision has been made against these income-tax demands). 9.02 6.77

vii A demand raised by the Service tax department, against which company has filed an appeal to the jurisdiction authorities. 3.39 0.06

viii A demand raised by the Custom department, against which company has filed an appeal to the jurisdiction authorities. 12.50 1.11

[28.2] Greenearth Resources & Projects Limited (formerly known as Austral Coke & Projects Limited) had filed a defamation suit in Hon'ble Bombay High Court against the Company for Rs.600 Crores. The Company had also filed Civil Suit in Hon'ble Calcutta High Court against Austral Coke & Projects Limited, all its Directors, its merchant bankers and Auditors and others claiming for loss of damages worth Rs.4761 crores. Management is confident that outcome of the defamation suit filed by the Austral Coke & Projects Limitedwould be in favour of the company.

[28.3] In the year 2007, the company and Armada Singapore Pte Ltd (“Armada”) entered into five year charter party agreement which provided, inter alia, for Armada to provide vessels to ship the company's tonnage, namely coal from various destinations worldwide. During the year 2009 Armada entered into Judicial Management, a Singaporean insolvency regime. As a result of Armada's insolvency, the Company did not make further nominations since there was no assurance or security for Armada's performance for the balance period under the agreement.In the year 2010 Armada filed its claim submission in an arbitration proceeding against the company in London for the year 2009 and 2010 and after all the repetitive challenges by the company w.r.t the defect in constitution of the Tribunal, the Tribunal passed an award in favour of Armada assessing the liability of the company as equivalent to Rs. 46 Crores (including interest of Rs. 3.7 Crores).Aggrieved by the aforesaid order the company has filed a civil suit against Armada with the Hon'ble High Court at Calcutta claiming fordamages for an amount of Rs 144 Crores and cancellation of the aforesaid award being void and restraining Armada from giving any effectto the award passed by the Tribunal. An order was passed by the Hon'ble High Court at Calcutta restraining Armada to take any furthersteps to enforce the award passed by the Tribunal in India. The matter is presently sub judice before the Hon'ble High Court at Calcutta.Meanwhile Armada executed an enforcement proceeding before the Federal Court of Australia, New South Wales which passed a freezing order of the assets held by the company in Australia. The company had challenged such enforcement proceedings before the same court and the final judgment is reserved by the court and is pending till date.Armada later on filed its claim submission against the company for the non-performance of contract for the year 2011 before the same arbitral tribunal in London which passed a further award in favour of Armada assessing the liability of the company as equivalent to Rs.25.4 Crores (including interest of Rs. 1.2 Crores). An appeal was filed by the company against said order before High Court of Justice, Queen's Bench Division, Commercial Court in England which is pending before the said court. Thereafter, a petition was filed in High Court at Calcutta against the said award of the arbitral tribunal for its cancellation. Affidavit in oppositions were filed by both the parties and the matter is presently sub judice before the Hon'ble High Court at Calcutta.During the year 2012, the company sought performance under the agreement from Armada, who failed to perform as per the terms of the agreement, which event was taken as repudiation of the agreement and the agreement was terminated. On the contrary, Armada filed another claim in March 2013 for non-performance for the year 2012 for an amount equivalent to Rs. 27 Crores and interest thereupon. The company has filed a counter claim for an amount equivalent to Rs 60 Crores and strongly opposed the claim of Armada before a newly constituted Arbitral Tribunal. The Arbitration hearing was held in London in the month of December 2013 and the order was published in January 2014 wherein the argument of Armada in regard to five vessels out of six vessels nominated by Armada in 2012 was turned down by the Tribunal. As per the order the precise quantum of the claim in regard to one vessel which Armada succeeded will be determined jointly by the expert of both parties. The determination of such quantum is pending.

[28.4] In September 2011 the company and Coeclerici Asia (Pte) Ltd (“Coeclerici”) entered into an agreement of sale and purchase of met cokeas per which the company had to supply the cargo to Ceoclerici at a mutually agreed price by 31st March 2012. As per the terms of theagreement Coeclerici made an advance of USD 10 million to the company in Sept 2011. Owing to the sluggish market conditions, theparties could not arrive at a mutually agreed price, as such no cargo was supplied by 31.03.2012 and the entire advance of USD 10 millionwas required to be refunded by the company to Coeclerici. The company has already refunded USD 3.2 million till Sept'13 to Coeclerici.The company does not dispute the repayment of the balance amount to Coeclerici and have been trying to make the balance payment. However, to secure its payment position, Coeclerici proceeded with the arbitration in London by filing its claim against the company. After all the arbitration proceedings, the Tribunal finally passed its order against the company for an amount equivalent to Rs. 46.2 Crores and interest thereupon.Thereafter an application was filed by Coeclerici in Australia to enforce the English Award and the Australian Court made ordersrecognizing and enforcing the Award, including the appointment of receiver to the shares held by the company in Gujarat NRE CokingCoal Ltd. (GNCCL) and Gujarat NRE Ltd (GNL) and the shares held by Mr. Arun Kumar Jagatramka in GNCCL. The company thereafterfiled an appeal against such order. However, the appeal was ultimately dismissed. Presently, receivers have control over the shares heldby the company in GNCCL and GNL and Mr. Arun Kumar Jagatramka in GNCCL for the purpose of sale to recover the judgment debt.


38

[28.5] The company had filed proceedings before the High Court, Calcutta against Gregarious Estates Incorporated (“Gregarious” or “Owners”),Gabriel Petridis (President / Director of Gregarious), Tapas Kumar Mukhopadhay (Director of Gregarious), Arun Dua (Director ofGregarious) and Bhatia International Pte. Limited in relation to the Time Charter Agreement dated January 29, 2008 entered into betweenGNCL and Gregarious whereby Gregarious agreed to give on hire and GNCL agreed to hire a vessel for a period of 82 to 86 months.In view of the fact that there was a change in management of Gregarious without the consent of the company, it was contended that as per the terms of the agreement the company has the right to terminate the said Agreement. Further the Agreement never cameinto effect as per the terms of the agreement Gregarious had failed to provide the calculations for ascertaining super profits (as described therein) to the company. The company had filed a suit in Calcutta High Court for a decree of Rs. 56.25 Crores and prayed for declaration that the arbitration agreement between the company and Gregarious be rendered illegal, null and void.During pendency of above proceedings, Gregarious initiated arbitration proceedings against the company and served a claim submission for an amount equivalent to Rs 212 Crores and interest thereupon.The matter was never heard on merits at all and only the matter of jurisdiction of English Courts/ Arbitral Tribunal in London was decided by the Indian Courts. The matter after being discharged by the Indian Court was referred to Arbitration Tribunal. The Arbitration hearing was held in London in the month of January 2014 and the order is presently reserved by the Tribunal. The management is confident of the outcome of case in favour of the company.

[28.6] On 8.1.14 Wollongong Coal Ltd. (“WCL”) (Formerly Gujarat NRE Coking Coal Ltd.) issued a demand notice to the company and its other group companies claiming over AUD 63 million being amount claimed due to WCL by the company.On 14.2.14 the company issued a counter demand for payment of USD 23.71 million being amount due by WCL and its subsidiary Wongawilli Coal Pty Ltd. (WCPL) to the company as on 31.1.14 on account of corporate guarantee commission for the corporate guarantees given by the company to the lender of WCL for the loans / facilities taken by WCL and on account quality claims. The said demand was refuted by WCL vide its letter dated 21.2.14. The management is taking necessary proactive steps in the matter and is confident of a favourable outcome.

5 [32]. i The company uses forward contracts to hedge its risks associated with foreign currencies relating to foreign currency liabilities. The company does not use forward contracts for speculative purpose.

(Rs. in Crores)


2014 2013

a Forward Contracts outstanding for hedging currency risks

- Loans – –

- Payable – 145.89

b Foreign Currency Exposures that have not been hedged

- Loans including accrued interest 214.96 211.84

- Payable 160.93 564.96

- Receivable 128.42 –

ii Exchange difference Gain/ (Loss) of Rs. Nil (Previous Year Rs. (1.34) Crores) in respect of unexpired period of forward cover contracts will be recognised in the Statement of Profit & Loss in subsequent year.

6 [33] Related Party Disclosures as required by Accounting Standard (AS-18) issued by the Institute of Chartered Accountants of India (ICAI), are given below:

A. Particulars of the Related Parties:

Subsidiary Companies

Wholly Owned

i Gujarat NRE Limited (Ceases to be subsidiary of the Company during the year)ii Hunter Valley Coal (P) Ltd.iii Manor Dealcom (P) Ltd.

Sub-Subsidiary Companies ( All Sub-Subsidiaries ceases to be Sub-subsidiaries of the Company during the year)

i Gujarat NRE Coking Coal Ltd.ii Gujarat NRE Wonga Pty. Ltd.iii Wonga Coal Pty. Ltd.iv Gujarat NRE Resources NLv Gujarat NRE Coal (NSW) Pty. Ltd.vi South Bulli Holdings Pty. Ltd.vii Gujarat NRE Properties Pty. Ltd.viii Gujarat NRE India Pty. Ltd.

Associates

i Bharat NRE Coke Ltd. (Ceases to be Associate of the Company during the year)ii NRE Metcoke Ltd.iii Surajbari Traders Pvt. Ltd.iv Dharwad Traders Pvt. Ltd.v Mandvi Traders Pvt. Ltd.vi Lunva Traders Pvt. Ltd.vii Critical Mass Multilink Ltd.viii Gujarat NRE Limited (Part of the year)



39



40

Enterprises in which key management personnel have significant Influence

i Bajrangbali Coke Industries Ltd.ii Bhachau Traders Pvt. Ltd.iii Bharat NRE Coke Ltd.(Part of the Year)iv Gujarat NRE Mineral Resources Ltd.v Khambhalia Traders Pvt. Ltd.vi Mahanidhi Vyapaar Pvt. Ltd.vii Mangal Crystal Coke Pvt. Ltd.viii Russel Vale Traders Pvt. Ltd.ix Wonga Traders Pvt. Ltd.

Enterprise in which key management person is a trustee

i Girdharilal Arun Kumar Family TrustB. Key Management Personnel & Relatives thereof

i Mr. A. K. Jagatramka – Chairman & Managing Directorii. Mrs. Mona Jagatramka – Directorii Mr. P. R. Kannan – Chief Financial OfficerC Transaction with Related Parties

(Rs. in Crores)

S.N Particulars of Transactions Current PreviousYear Year

i Sale/(Sales Return) of Goods/Services

– Associates – 46.99

– Sub-Subsidiaries 93.67 27.33

– Enterprises in which key management personnel has significant influence – 0.01

ii Purchase of Goods /Services

– Associates 13.97 5.19

– Sub-Subsidiaries (32.55) 516.42

– Enterprises in which key management personnel has significant influence 22.55 2.13

iii. Remuneration

– Key Management personnel 0.76 2.51

iv Investments

– Subsidiaries 101.64 75.09

v Shares Alloted


vi Share Warrant Deposit

Received


Forfeited

– Enterprises in which key management personnel has significant influence – 93.75

vii Advance against Share Warrant Deposit

Received

– Enterprises in which key management personnel has significant influence 65.26 –

viii Rent Paid

– Enterprises in which key management personnel is a trustee 0.76 0.25

ix Security Deposit Given/(Refunded)

– Associates (35.00) –

– Enterprises in which key management personnel is a trustee (9.35) –

x Loans / Advance Given/(Refunded)

– Associates 2.16 5.06

– Subsidiaries – (0.02)

– Sub-Subsidiaries – (74.50)

– Enterprises in which key management personnel has significant influence 14.34 –



41


xi Guarantees/Collateral Securities Outstanding as at the Year end

– Given on behalf of Sub-Subsidiaries – 2,453.63

– Given on behalf of Subsidiaries – 190.36

– Given on behalf of Associates 215.88 –

– Given on behalf of Enterprises in which Key Management Personnel has

significant influence 89.85 –

– Given by Enterprises in which key management personnel has significant influence.

(By pledge of Shares) 10.00 –

– Given by Associates on behalf of the Company 155.00

– Given by Key Management Personnel on behalf of the Company 2,777.17# 2,298.20

– Given by Enterprises in which key management personnel has significant influence 346.78

# As per CDR Package, Associates of the Company, Key Management Personnel, Relatives of Key Management personnel & some of the Enterprises in which Key Management personnel has significant influence has given Guarantee on behalf of the Company to the extent of Loan Outstanding.

D The Company has the following amounts due from/ to related parties:

(Rs. in Crores)


2014 2013

Due from Related Parties

(included in loans & advances and sundry debtors)

Subsidiaries

– included in Loans & Advances – 89.13

Associates

– included in Sundry Debtors – 52.38

– included in Loans & Advances 31.10 101.05

Enterprises in which key managerial personnel has significant influence

– included in Sundry Debtors 15.08 –

– included in Loans & Advances 80.00 39.35

Due to Related Parties

(included in current liabilities)

– Sub-Subsidiaries – 541.40

Enterprises in which key management personnel has significant influence 0.50 1.95

6 [35]

7 [37] Exceptional items for the year ended 31st March'2014 represents net foreign exchange loss of Rs.73.32 Crores , including Rs. 25.85 Crores included in Finance Cost,(Previous Year 60.11 Crores including Rs. 12.15 Crores included in Finance Cost) has been incurred due to unusual diminution in the value of Rupee as against the US Dollar during the year.

8 [40] Previous year's figure have been regrouped/reclassified wherever necessary to correspond with the current year's classification / disclosure.

The Shareholders of Gujarat NRE Coke Ltd.(GNCL) & Bharat NRE Coke Ltd.(BNCL) at their respective Shareholder's meeting held on 28.01.13 approved and adopted the scheme of amalgamation of BNCL with GNCL. However in view of subsequent development of reference of GNCL to CDR EG for its debt restructuring the said merger was not allowed by Hon'ble High Court of Calcutta.

}

Cash Flow Statement for the year ended 31st March, 2014

(Rs. in Crores)

For the Year ended For the Year ended31-Mar-14 31-Mar-13

A CASH FLOW FROM OPERATING ACTIVITIES

Net Profit / (Loss) before Tax (834.40) 46.27

Adjustments for:

Depreciation / Other non cash items 61.30 58.33

Interest Paid / Payable 331.40 263.02

Other Income (311.88) (27.61)

Loss/(Profit) on Sale / Discard of Fixed Assets 0.70 (0.02)

Employee Stock Option - Compensation (0.06) 0.67

Interest Received / Receivable (6.39) (11.26)

Operating Profit before Working Capital Changes (759.33) 329.40

Adjustments for:

Trade & Other Receivables 110.64 (273.91)

Inventories 753.95 (142.18)

Trade Payables (581.58) (69.81)

Cash Generated/(Used) from Operations (476.32) (156.50)

Direct Taxes Paid / Refunds (6.53) 7.27

Cash Generated/(Used) from Operating Activities (482.85) (149.23)

B CASH FLOW FROM INVESTING ACTIVITIES

Addition to Fixed Assets (52.70) (66.59)

Sale of Fixed Assets 19.78 0.02

Addition to Investments (101.64) (75.09)

Interest Received 6.39 11.27

Dividend / Misc Income 183.46 27.61

Net Cash Generated/(Used) in Investing Activities 55.29 (102.78)

C CASH FLOW FROM FINANCING ACTIVITIES

Net Proceeds to Share Capital / Reserves 7.91 94.86

Deposit against Share Warrant – 2.64

Advance against Share Warrant/ Share Application Money 78.65 –

Increase in Long / Short term borrowing 607.91 456.18

Interest Paid (332.34) (262.16)

Dividend & Dividend Tax Paid (0.07) (9.63)

Net Cash Generated/(Used) from Financing Activities 362.06 281.89

Net Increase / (Decrease) in Cash & Cash Equivalents (65.50) 29.88

Cash & Cash Equivalents (Opening Balance) 98.68 68.80

Cash & Cash Equivalents (Closing Balance)* 33.18 98.68

* Includes Dividend accounts of Rs. 1.85 crores (Previous Year Rs. 1.92 Crores)

In terms of our report of even date annexed hereto




42

43

STATEMENT PURSUANT TO SECTION 212 OF THE COMPANIES ACT, 1956 RELATING TO SUBSIDIARY COMPANIES


Name of the Subsidiary Company Huntervalley ManorCoal Pvt. Ltd. Dealcom Pvt Ltd

1. Country of Incorporation India India

2. Financial Year of the subsidiary ended on 31.03.14 31.03.14

3. Holding Company's Interest

i) Equity Shares

a) Number of Shares 25,115,850 23,628,150

b) % of Share held by Gujarat NRE Coke Ltd and its Subsidiaries 100.00% 100.00%

ii) Preference Shares

a) Number of Shares – –

b) % Share held by Gujarat NRE Coke Ltd and its Subsidiaries – –

4. Net aggregate amount of Profit/(Losses) of the Subsidiary, so far as they concern members of Gujarat NRE Coke Ltd

i) For the Financial Year of Subsidiary

a) Dealt with in the accounts of the Holding company – –

b) Not dealt with in the accounts of the Holding company 0.00 0.00

ii) For the previous Financial Years of the Subsidiary since it became the holding Company's Subsidiary

a) Dealt with in the accounts of the Holding company – –

b) Not dealt with in the accounts of the Holding company 0.01 0.00

5. Changes in the interest of Gujarat NRE Coke Ltd between the end of the subsidiary's financial year and 31st March, 2014

Number of shares acquired – –

Material changes between the end of the subsidiary's financial year and 31st March, 2014

a) Fixed assets (net additions) – –

b) Investments (Net) – –

c) Moneys lent by the subsidiary – –

d) Moneys borrowed by the subsidiary company other than for meeting current liabilities – –

Notes:

The Ministry of Corporate Affairs vide its circular no.2/2011 dated 8th February 2011 has granted a general exemption under section 212(8) of the Companies Act 1956, from attaching the Balance Sheet, Profit & Loss Account and other documents of the subsidiary companies to the balance sheet of any company upon compliance of certain conditions, the Balance Sheet, Profit & Loss Account and other documents of the subsidiaries are not attached to the Annual Reports & Accounts. The Annual Accounts of the Subsidiaries Companies are available for inspection by any investor at the Registered Office of the Company & the concerned subsidiary of the Company.

44


Particulars of Subsidiary Companies issued under section 212 (8) of the Companies Act, 1956 for the financial year 2013-14 are as follows :-

(Rs. in crores)

Name of the Subsidiary Company Huntervalley ManorCoal Pvt Ltd Dealcom Pvt Ltd

(a) Share Capital (Equity and Preference) 2.51 2.36

(b) Reserve & Surplus (net of debit balance of profit & loss account) 245.82 232.05

(c) Total Assets 248.33 234.42

(d) Total Liabilities 0.00 0.00

(e) Details of Investment (excluding investments in the subsidiary companies)

– Equity / Preference Shares 248.28 234.37

– Government Securities – –

– Bonds/ Mutual Funds Units – –

(f) Turnover 0.00 0.01

(g) Profit/(Loss) Before Taxation 0.00 0.00

(h) Provision for Taxation 0.00 0.00

(i) Profit/ (Loss) after Taxation 0.00 0.00

(j) Proposed Dividend (including Corporate Dividend Tax) – –

To the Members of Gujarat NRE Coke limited

The accompanying abridged consolidated financial statements, which comprise the abridged consolidated balance sheet as at 31 March, 2014, the abridged consolidated statement of profit & loss, and abridged consolidated cash flow statement for the year then ended, and related notes, are derived from the audited consolidated financial statements of Gujarat NRE Coke limited ('the Company') for the year ended 31 March, 2014.

The abridged consolidated financial statements do not contain all the disclosures required by the Accounting Standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956 (“the Act”) applied in the preparation of the audited consolidated financial statements of the Company. Reading the abridged consolidated financial statements, therefore, is not a substitute for reading the audited consolidated financial statements of the Company.

Management's Responsibility for the Abridged Consolidated Financial Statements

Management is responsible for the preparation of a summary of the audited consolidated financial statements in accordance with Rule 7A of the Companies (Central Government's) General Rules and Forms, 1956 read with Companies (Central Government's) General Rules and Forms (Amendment) Rules, 2012 and are based on the audited consolidated financial statements for the year ended 31 March, 2014, prepared in accordance with Accounting Standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956 (“the Act”) and accounting principles generally accepted in India.

Auditors' Responsibility

Our responsibility is to express an opinion on the abridged consolidated financial statements based on our procedures, which were conducted in accordance with Standard on Auditing (SA) 810, “Engagements to Report on Summary Financial Statements” issued by the Institute of Chartered Accountants of India.

Opinion

In our opinion, the abridged consolidated financial statements, prepared in accordance with Rule 7A of the Companies (Central Government's) General Rules and Forms, 1956 read with Companies (Central Government's) General Rules and Forms (Amendment) Rules, 2012 are derived from the audited consolidated financial statements of the Company for the year ended 31 March, 2014 and are a fair summary of those consolidated financial statements.

Basis of Qualified Opinion

We draw attention to Note 30(b) of the accompanying financial statements in considering Financial Statements of erstwhile five Australian Subsidiaries, which were more than six months old on the date on which these five companies ceased to be subsidiaries of the company, which is not in conformity with Accounting Standard 21 issued by ICAI and in respect of remaining four Australian Subsidiaries, the Management Approved Accounts as on the date on cessation of Subsidiaries has been considered.In absence of audited statement of these nine subsidiaries companies as on the dates of their cessation of status of subsidiaries of the company, the impact of the same as compared to the amounts taken in consolidated financial statements could not be known.

Emphasis of Matter

We also draw the attention to Note 30(c) of the accompanying financial statements regarding the use of Unaudited Management Approved Financial Statements of Gujarat NRE Ltd., an Australian Associate of the Company for the preparation of Consolidated Financial Statements. This is information and shall not be construed as audit opinion.


(Firm's Registration No. : 302081E)

A PaulPlace : Kolkata (Partner)Dated : 25th May, 2014 Membership No. 06490

Independent Auditors' Report on Abridged Consolidated Financial Statements

Independent Auditors’ Report on Consolidated Financial Statements


To the members of Gujarat NRE Coke Limited

Report on the Consolidated Financial Statements

We have audited the accompanying consolidated financial statements of Gujarat NRE Coke Limited (“the Company”), its subsidiaries and jointly controlled entities (together referred to as 'the Group') as at March 31, 2014, which comprise the Consolidated Balance Sheet as at March 31, 2014, the Consolidated Statement of Profit & Loss and Consolidated Cash Flow Statement for the year then ended, and a summary of significant accounting policies and other explanatory information.

Management's Responsibility for the Consolidated Financial Statements

The Company's Management is responsible for the preparation of these consolidated financial statements that give a true and fair view of the consolidated financial position, consolidated financial performance and consolidated cash flows of the Group in accordance with the accounting principles generally accepted in India. This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and presentation of the consolidated financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditor's Responsibility

Our responsibility is to express an opinion on these consolidated financial statements based on our audit. We conducted our audit in accordance with the Standards on Auditing issued by the Institute of Chartered Accountants of India. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the consolidated financial statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the consolidated financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the Company's preparation and presentation of the consolidated financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by Management, as well as evaluating the overall presentation of the consolidated financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our qualified audit opinion.

Basis of Qualified Opinion

We draw attention to Note 30(b) of the accompanying financial statements in considering Financial Statements of erstwhile five Australian Subsidiaries, which were more than six months old on the date on which these five companies ceased to be subsidiaries of the company, which is not in conformity with Accounting Standard 21 issued by ICAI and in respect of remaining four Australian Subsidiaries, the Management Approved Accounts as on the date on cessation of Subsidiaries has been considered.

In absence of audited statement of these nine subsidiaries companies as on the dates of their cessation of status of subsidiaries of the company, the impact of the same as compared to the amounts taken in consolidated financial statements could not be known.

Qualified Opinion

In our opinion and to the best of our knowledge and according to the information and explanations given to us, except for the effects of the matter described in paragraph above, the consolidated financial statement give a true and fair view in conformity with the accounting principles generally accepted in India:

a) in the case of the consolidated Balance Sheet, of the state of affairs of the Company as at March 31, 2014;

b) in the case of the consolidated Statement of Profit and Loss, of the loss for the year ended on that date; and

c) in the case of the consolidated Cash Flow Statement, of the cash flows for the year ended on that date.

Emphasis of Matter

We also draw the attention to Note 30(c) of the accompanying financial statements regarding the use of Unaudited Management Approved Financial Statements of Gujarat NRE Ltd., an Australian Associate of the Company for the preparation of Consolidated Financial Statements. This is an information and shall not be construed as audit opinion.


(Firm's Registration No. : 302081E)

A PaulPlace: Kolkata (Partner)Dated: 25th May, 2014 Membership No. 06490

45

Abridged Consolidated Balance Sheet as at 31st March, 2014


(Statement containing salient features of Balance Sheet as per Section 219(1)(b)(iv) of Companies Act,1956)(Rs. in Crores)

PARTICULARS As at As at 31.03.2014 31.03.2013

i. EQUITY AND LIABILITIES

(1) Shareholders' Funds

(a) Paid up Share Capital

(i) Equity & “B” Equity Share Capital 627.37 622.37(b) Reserves & Surplus

(i) Capital Reserve 144.87 144.87(ii) Surplus (581.08) (76.23)(iii) Securities Premium Reserve 501.27 495.73(iv) General Reserve 251.25 249.13(v) Foreign Currency Translation Reserve – 3.37(vi) Debenture Redemption Reserve 196.57 196.58(vii) Employee Stock Option Outstanding 6.31 71.31(viii) Equity Conversion Bond Reserve – 8.51(ix) Restoration Guarantee Reserve – 519.19 56.07 1,149.33(c) Deposit against Share Warrants 10.40 13.04

(2) Minority Interest – 1,379.59(3) Non- Current Liabilities

(i) Long-term borrowings 1,963.91 2,663.30(ii) Long-term provisions 8.30 1,972.21 9.08 2,672.38

(4) Current Liabilities

(i) Short-term borrowings 749.47 1,095.45(ii) Trade Payables 209.64 1,133.11(iii) Other Current Liabilities 278.19 1,232.77(iv) Short-term provisions 9.65 1,246.95 128.06 3,589.39

Total of (1) to (4) 4,376.12 9,426.10

ii. ASSETS :

(5) Non- Current Assets

(a) FIXED ASSETS

(i) Tangible Assets (Original cost less depreciation) 898.80 4,829.28(ii) In Tangible Assets (Original cost less depreciation) 310.86 339.94(iii) Capital Work-in-Progress 183.26 1,392.92 439.39 5,608.61(b) Non-Current Investments

(i) Quoted (Market Value-Rs.43.08 Cr. P.Y-Rs.97.45 Cr.) 55.66 37.23(ii) Unquoted 510.35 566.01 350.47 387.70(c) Long-term loans & advances 72.80 255.61 (d) Deferred Tax Assets/(Liabilities) (net) 112.34 27.73

(6) Current Assets

(a) Inventories 977.52 1,826.06 (b) Trade Receivables 476.62 701.87 (c) Cash & Cash Equivalents

Balances with Bank 33.08 114.88Cash in hand 0.20 33.28 0.32 115.20

(d) Short term loans & advances 744.63 503.31 Total of (5) to (6) 4,376.12 9,426.10

Refer Notes forming part of the Abridged Consolidated Accounts

The complete set of consolidated balance sheet, statement of consolidated profit & loss, other statements and notes thereto prepared as per the requirements of Schedule VI of the Companies Act, 1956 are available at the Company’s Website at www.gujaratnre.comCompiled from the Audited Accounts of the Company referred to in our Report dated 25th May, 2014.



46


Abridged Consolidated Statement of Profit & Loss for the year ended 31st March, 2014

(Statement containing salient features of Statement of Profit & Loss as per Section 219(1)(b)(iv) of Companies Act,1956 )

(Rs.in Crores)

PARTICULARS For the year ended For the year ended31.03.2014 31.03.2013

I INCOME

Sales 970.21 2,094.56

Less: Excise Duty 37.83 932.38 65.16 2,029.40

II Other Income 404.71 135.33

III Total Income (I+II) 1,337.09 2,164.73

IV EXPENDITURE

(a) Cost of material Consumed 851.71 419.66

(b) Purchse of Stock in Trade 409.49 139.88

(c) Changes in Inventories of Finished Goods,

Stock-in-Process and Stock in Trade 211.47 (116.36)

(d) Employees Benefits Expenses 44.08 174.13

(e) Finance Cost 349.24 390.59

(f) Depreciation 61.30 321.40

(g) Other Expenses 126.16 853.74

Total Expenditure (a to g) 2,053.45 2,183.05

V Profit/(Loss) before Exceptional Items, Extraordinary Items & Tax (III-IV) (716.36) (18.34)

VI Exceptional Items 47.60 46.89

VII Extra Ordinary Items – 30.81

VIII Profit/(Loss) Before Tax (V-VI-VII) (763.96) (96.02)

IX Tax Expenses

– Current Tax – (53.97)

– Deferred Tax (273.32) (152.20)

– MAT Credit Entitlement – 7.87

– Tax for Earlier Years (0.27) (273.59) 0.27 (198.03)

Profit/(Loss) after Tax for the year (VIII - IX) (490.37) 102.01

Less: Minority Interest – (10.98)

Add: Share in Profit/(Loss) of Associates (37.23) (0.17)

Profit/(Loss) after Tax for the year, minority interest &

share of profit of Associates (527.60) 112.82

Earnings per Equity & "B" Equity Share (In Rs.)

(Face Value of Rs.10 per Share)

Basic (8.42) 1.90

Diluted (8.42) 1.89

Refer Notes forming part of the Abridged Consolidated Accounts

Compiled from the Audited Accounts of the Company referred to in our Report dated 25th May, 2014.



47

Notes to Abridged Consolidated Financial Statements


1. All amounts in the Abridged Consolidated financial statements are presented in Rupees Crores, unless otherwise stated. The note numbers appeared in the "[ ]" are as they appear in the complete set of Financial Statements. These abridged consolidated financial statements have been prepared in accordance with the requirement of Rule 7 A of Companies(Central Government's) General Rules & Forms,1956 and clause 32 of the Listing Agreement. These abridgedconsolidated financial statements have been prepared on thebasis of the complete set of financial statements of the year ended March 31, 2014

2. SIGNIFICANT ACCOUNTING POLICIES

i. Accounting Conventions

The consolidated financial statements are prepared under historical cost conventions and as a going concern basis following the accrual basis of accounting and in accordance with the generally accepted accounting principles (GAAP) in India.

ii. Principles of Consolidation

The accounts of subsidiaries including foreign subsidiaries have been consolidated with the parent companies accountsin accordance with Accounting Standard-21 on “Consolidated Financial Statements” and investments in Associates have been accounted for using the equity method as perAccounting Standard-23 on “Accounting for Associates in Consolidated Financial Statements” as specified in the Companies (Accounting Standard) Rules, 2006.

Consolidated Financial Statements have been made by adding together like items of assets, liabilities, income and expenses. The inter-company transactions and unrealized profits/(losses) thereon have been eliminated in full.

Goodwill/Capital Reserves represent the difference between the cost of control in the subsidiaries/associates, over the book value of net assets at the time of acquisition of control in the subsidiaries/associates.

Foreign subsidiaries/ Associates are considered as non-integral foreign operation as per Accounting Standard-11, on “The effect of Changes in Foreign Exchange Rates”. The financial statements of the same have been converted using the following methods:

Components of Statement of Profit & Loss except opening & closing stock have been converted using monthly average rate of the reported year.

Components of Balance Sheet have been converted using the rates at the balance sheet date, except balance of Statement of Profit & Loss. Resultant foreign exchange translation difference has been recognized as “Foreign Currency Translation Reserve”.

iii. Use of estimates

The preparation of the consolidated financial statements in conformity with the generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities for the year under review and disclosure of contingent liabilities on the date of the consolidated financial statements. Actual results could differ from these estimates. Any revision to accounting estimates is recognized prospectively in the current and future periods.

iv) Revenue Recognition

Revenue is recognised to the extent that it is probable that the economic benefits will flow to the company and revenue can be reliably measured

a. In respect of Sales : When the significant risksand rewards of ownership of goods have been passed on to the buyer, which generally coincides with delivery / shipment of goods to custo-mers.

b. In respect of Interest : On time proportion basis takingIncome into account the amount

outstanding and the rate applicable.

c. In respect of Service : When the services areIncome performed as per contract.

d. In respect of Dividend : When right to receive paymentIncome is established.

e. In respect of Insurance : On Settlement of ClaimsClaims

f In respect of Guarantee : When right to receiveCommission payments is established

Revenue from product sales is recognised inclusive of Excise duty but exclusive of Sales Tax / Value added Tax (VAT) and net of returns, Sales Discount etc. Sales Returns are accounted for when goods are returned.

v. Fixed Assets

Fixed assets are stated at historical cost, which comprises cost of purchase/construction cost, cost of borrowing and other cost directly attributable to bring the assets at its working condition and location for its intended use. Expenditures during construction period are allocated to the relevant assets in the ratio of costs of respective assets.

vi. Depreciation on Fixed Assets

Depreciation on Fixed Assets is provided on Straight Line Method (SLM) at the rates and in the manner prescribed in Schedule XIV of the Companies Act, 1956.

In case of foreign subsidiaries, depreciation is provided on Straight Line Method (SLM) over the useful life of assets.

Mining lease is amortised over the life of the asset. Amortisation is calculated in proportion of actual production when measured against the resources available in the mine.

Mine Development is activities undertaken to gain access to mineral reserves. Typically this includes sinking shafts, permanent excavations, building transport infrastructure and roadways. All costs relating to mine development are capitalised and are amortised over the estimated reserve in that developed area of the mine. Amortisation is calculated in proportion to actual production when measured against mineable resources in the mine area developed on which the expenses were incurred. The carrying value of mine development is reviewed by directors to ensure it is not in excess of its recoverable amount.

Pre-production costs All costs relating to the pre-production of coal were capitalised and are amortised over the estimated life of reserves in the mine. Amortisation is calculated in proportion to actual production when measured against mineable resources in the mine seam for which the expenses were incurred. The carrying value of pre-production is reviewed by directors to ensure it is not in excess of its recoverable amount.

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vii. Inventories

1. Inventories are valued as under:

a. Raw Materials : At Cost or Net Realisable Value whichever is lower

b. Finished Products : At Cost or Net Realisable Value whichever is lower

c. Stores, Spares and : At Cost or Net Realisable Value Components whichever is lower

d. Stock in process : At Raw material Cost plus estimated cost of conversion up to the stage of completion or Net Realisable Value whichever is lower.

Cost includes all direct cost and applicable manufacturing and administrative overheads.

2. Inventories are valued on FIFO basis.

3. Variation, if any, between books and physical stocks detected on physical verification, obsolete & slow moving stocks are adjusted in accounts as found appropriate.

viii. Investments

Long term investments are stated at cost. Provision is made when diminution in the value of investments is considered permanent in nature.

Current investments are stated at lower of cost and market value.

ix. Foreign Exchange Transactions

a. Initial Recognition

Foreign Exchange transactions are recorded normally at the exchange rates prevailing on the date of the transactions.

b. Conversion

Foreign currency monetary items are reported using the closing rate. Non-monetary items which are carried in terms of historical cost denominated in a foreign currency are reported using the exchange rate at the date of transaction and non-monetary items which are carried at the fair value or other similar denominated in a foreign currency are reported using the exchange rates that existed when the values were determined.

c. Exchange differences

Exchange differences arising on settlement of transactions or on reporting monetary items of the Company at the rate different from those at which they were initially recorded during the year, or reported in previous financial statement, are recognised as income or expenses in the year in which they arise except in case where they relate to acquisition of fixed assets.

d. Forward Exchange Contract not intended for

trading or speculative purposes

The premium or discount arising at the inception of forward exchange contract is amortized as expenses or income over the life of the respective contract. Exchange differences on such contracts are recognised in the statement of Profit or Loss in the year in which exchange rate changes. Any profit or loss arising on cancellation or renewal of forward exchange contract is recognised as income or as expenses for the year.

x. Provisions, Contingent Liabilities and Contingent

Assets

The Company makes a provision when there is present obligation as a result of past event that probably requires an outflow of resources and a reliable estimate can be made of the amount of the obligation. A disclosure for contingent liabilities is made when there is a possible obligation or a present obligation that may, but probably will not, require an outflow of resources. Contingent Assets are disclosed when an inflow of economic benefit is probable and/or certain.

xi. Borrowing Costs

Borrowing Costs that are attributable to the acquisition and construction of qualifying assets are capitalised as a part of the cost of such assets. A qualifying asset is one that necessarily takes substantial period of time to get ready for its intended use. Other borrowing costs of the year are charged to revenue in the period in which they are incurred.

xii. Taxation

Current Tax is determined as the amount of tax payable in respect of taxable income for the period.

Deferred Tax Liability is recognized for all timing difference between taxable income and accounting income that originate in one period and are capable of reversal in one or more subsequent periods.

Deferred Tax Assets are recognized only if there is reasonable certainty that the same will be realized and are reviewed for the appropriateness of its respective carrying values at each Balance Sheet date.

Tax on Distributed Profit Payable is in accordance with the provision of Section 155O of the Income Tax Act, 1961 and in accordance with guidance note on Accounting for Corporate Dividend Tax.

Wealth Tax is determined on taxable value of assets on the balance sheet date.

Foreign Companies recognize tax liabilities and assets as per their local regulations & laws.

xiii. Employee benefits

a) Short Term & Post Employment Benefits

Employee benefits of short-term nature are recognized as expense as and when those accrue. Post employments benefits are recognized as expenses based on actuarial valuation at year end which takes into account actuarial gains and losses.

b) Employee Stock Option Scheme (ESOS)

Aggregate quantum of options granted under the schemes in monetary term net of consideration of issue, to be paid in cash, are shown in the Balance Sheet as Employees Stock Option outstanding under Reserves & Surplus and as Deferred Employees Compensation (ESOS) under Miscellaneous Expenditure as per guidelines of SEBI in this respect. With the exercise of options and consequent issue of equity shares corresponding ESOS outstanding is transferred to Securities Premium Account.

Notes to Abridged Consolidated Financial Statements (contd.)

49


In case of foreign subsidiaries the fair value of options granted is recognised as an employee benefit expense with a corresponding increase in equity. The fair value is measured at grant date and recognized over the period during which the employee become unconditionally entitled to the options. Fair value at grant date is independently determined using Binomial method for option pricing.

xiv. Indirect Taxes

Excise Duty on Finished Goods Stock is accounted for at the point of manufacture of goods and is accordingly considered for valuation of finished goods stock as on Balance sheet date. Customs duty on imported raw materials is accounted for on the clearance of goods from the Customs Authorities.

In Foreign Subsidiaries

Revenues, expenses and assets are recognised net of the amount of GST, except where the amount of GST incurred is not recoverable from the Australian Taxation Office. In these circumstances the GST is recognised as part of the cost of acquisition of the asset or as part of an item of the expense. Receivables and payables in the balance sheet are shown inclusive of GST.

xv. Un Amortised Expenditure

Unamortised expenditure, stated at cost, is amortized over period of time as under:

(i) Deferred Revenue Expenses - 5 years

(ii) Deferred Employees Compensation under ESOS -

Amortised on straight line basis over vesting period.

The restoration liability calculated as discounted present value in relation to restoration guarantee at the end of the lease is correspondingly represented by a Unamortised Expenditures as Deferred restoration Guarantee.

The deferred restoration guarantee, after deducting the change in liability, is amortised on a straight line basis over the life of the mine lease.

xvi. Impairment of Assets

The Company assesses at each Balance Sheet date whether there is any indication of an asset being impaired. An asset is treated as impaired when the carrying cost of assets exceeds its recoverable value, in which case the impairment loss is charged to the Statement of Profit and Loss of the

year. The impairment loss recognised in prior accounting periods is reversed if there has been a change in the estimate of recoverable amount.

xvii. Research and development

Revenue expenditure on research and development is expensed as incurred. Capital expenditures incurred on research and development having alternate uses are capitalised as fixed assets and depreciated in accordance with the depreciation policy of the Company.

xviii.Earning per share (EPS)

The basic earning per share (“EPS”) is computed by dividing the net profit after tax for the year by the weighted average number of equity shares outstanding during the year. For the purpose of calculating diluted earnings per share, net profit after tax for the year and the weighted average number of shares outstanding during the year are adjusted with the effects of all dilutive potential equity shares. The dilutive potential equity shares are deemed converted as at the beginning of the period, unless they have been issued at a later date.

xix. Prior Period Adjustments, Extra-ordinary Items and

Changes in Accounting Policies

Prior period adjustments, extraordinary items and changes in accounting policies having material impact on the financial affairs of the Company are disclosed.

xx Minority Interest

Minority Interest as shown in the consolidated balance sheet comprises of share in equity and reserves and surplus/losses of the subsidiaries.

xxi. Segment Reporting

i. Identification of Segments :

The Group's Operating Businesses are organized and managed separately according to the nature of products and services provided, with each segment representing a strategic business unit that offers different products and serves different markets.

ii. Allocation of Common Costs :

Common allocable costs are allocated to each segment according to sales of each segment to total sales of the Group.


50


3 [26] [a] Debt Restructuring:

During the year, the Company was referred to the Corporate Debt Restructuring (CDR) Cell, a non statutory voluntary mechanism set up under the aegis of Reserve Bank of India. Pursuant to that a Corporate Debt Restructuring (CDR) Package as recommended by State Bank of India, the lead banker has been approved by the CDR empowered Group (CDR EG) at its meeting held on 14th March 2014 and communicated vide Letter of Approval dated 22nd March 2014 as amended/modified vide letter dated 7th April 2014.

The key features of the approved CDR Package are as follows:

a) The Cutoff date under the CDR package is 01st August 2013.

b) The tenure of existing NCDs and Term Loans aggregating to Rs. 1020.69 Crores has been revised to 10 years from the cut - off date with a moratorium of 2 years. The repayment shall be in 32 quarterly installments from 1st August 2015. The revised applicable interest rate shall be initially 10.75% p.a. and gradually being stepped upto 11.65% p.a.

c) Conversion of various irregular/devolved portion of working capital facilities into Working Capital Term Loan (WCTL) of 10 years repayable after a moratorium of 2 years from the cut off date in 32 quarterly installments from 1st August 2015. The applicable interest rate shall be initially 10.75% p.a. and gradually being stepped upto 15.00% p.a.

d) Interest on existing Term Loan, NCDs and WCTL for the period from 1st August 2013 to 31st July 2015 and Interest on Working Capital outstanding for the period from 1st August 2013 to 31st March 2014 will be funded and converted into Funded Interest Term Loan (FITL) of 10 years repayable after a moratorium of 2 years from the cut off date in 32 quarterly installments from 1st August 2015. The applicable interest rate shall be initially 11.00% p.a. gradually being stepped upto 15.00% p.a.

e) Additional Term Loan - I of Rs. 450 Crores for meeting long term working capital needs of the company to be provided by 3 working capital CDR lenders and 2 working capital Non CDR lenders. The repayment shall be in 32 quarterly installments from 1st August 2015. The applicable interest rate shall be initially 11.00% p.a. and gradually being stepped upto 11.50% p.a.

f) Additional Term Loan - II of Rs. 50 Crores to part finance the capital expenditure for completing the Waste Heat Recovery Based Power plant (Phase I & II) at Dharwad, Karnataka. The repayment shall be in


51

32 quarterly installments from 1st August 2015. The applicable interest rate shall be initially 10.75% p.a. and gradually being stepped upto 11.65% p.a.

g) Need based working capital requirement assessed for FY 2014 - 15 of Rs. 650 Crores(Fund Based) and Non fund based limit of Rs. 425 Crore (LC/LOU of Rs. 400 Crores and Bank Guarantee of Rs. 25 Crores). The rate of interest on fund based limits shall be @ 11% p.a.

h) Waiver of penal interest and all other charges from the cut - off date.

i) Non levy/waiver/refund of liquidated damages/penal interest/penal charges for delay/ irregularities due to lenders/creation of security from the cut off date.

j) Right of Recompense to CDR lenders for the relief and sacrifice extended, subject to provisions of CDR guidelines.

k) Contribution of Rs. 51.50 Crores in the company by promoters towards lenders' sacrifice. In addition Promoters will also bring in Rs. 20 Crores as their margin/ Contribution for the Waste Heat Recovery Based Power Plant.

[b] Status of Implementation of CDR Package:

Sanctions under the CDR package have been received from 13 out of 15 CDR lenders. The CDR package has partially been implemented by 12 CDR lenders. However, as the CDR package has been approved by super majority of the CDR lenders as per RBI guidelines, debt owing to all the CDR lenders have been reclassified and interest has been recalculated in accordance with the CDR package. The above reclassifications and interest calculations are subject to reconciliation and approval by these lenders.

In terms of the provisions of the CDR package, ICICI Bank Limited on 31/03/2014 has converted its existing Term Loan facilities of Rs. 95.67 crores to FCNRB loan of US$ 15.94 million at the interest rate of 3 months LIBOR+5.00% p.a.

In terms of the provisions of the CDR package, ICICI Bank Limited has requested to convert a sum of Rs. 13.39 crores (part of FITL interest) into fully paid up equity shares of Rs.10/- each. The price based on the terms of SEBI (Issue of Capital and Disclosures requirements) Regulations 2009 has been taken at Rs. 11.01 per share. The said amount has been adjusted with the FITL account of ICICI Bank Ltd and transferred to Advance against Share application money Account. The Bank shall be issued 121.61 lacs equity shares of Rs. 10 each at a premium of Rs. 1.01 per share.

The aggregate present value of the outstanding sacrifice made/to be made by CDR lenders as per the approved CDR package is estimated at Rs. 342.39 Crores.


(Rs. in Crores)4 [27] Contingent liabilities not provided for in respect of:

[27.1] For Parent Company (Gujarat NRE Coke Ltd.) As on 31st As on 31st

March 2014 March 2013

i Letter of Credits outstanding for purchase of materials. – 1.16

ii Outstanding Bank Guarantees 2,893.29 23.06

iii Capital commitments 58.80 59.17

iv Bills discounted under letter of credit with banks 13.36 41.89

v Duty on account of Advance Authorisation against Export obligation. 4.87 4.87

vi On Balance Sheet date, the disputed amount involved in four (Previous Year four) income-tax demands under appeal. The management is of view that the outcome of the appeal would be favourable to the company, hence no provision has been made against these income-tax demands. 9.02 6.77

vii A demand raised by the Service tax department, against which company has filed an appeal to the jurisdiction authorities. 3.39 0.06

viii A demand raised by the Custom department, against which company has filed an appeal to the jurisdiction authorities. 12.50 1.11

27.2 Greenearth Resources & Projects Limited (formerly known as Austral Coke & Projects Limited) had filed a defamation suit in Hon'ble Bombay High Court against the Company for Rs.600 Crores. The Company had also filed Civil Suit in Hon'ble Calcutta High Court against Austral Coke & Projects Limited, all its Directors, its merchant bankers and Auditors and others claiming for loss of damages worth Rs.4761 crores. Management is confident that outcome of the defamation suit filed by the Austral Coke & Projects Limited would be in favour of the company.

27.3 In the year 2007, the company and Armada Singapore Pte Ltd (“Armada”) entered into five year charter party agreement which provided, inter alia, for Armada to provide vessels to ship the company's tonnage, namely coal from various destinations worldwide. During the year 2009 Armada entered into Judicial Management, a Singaporean insolvency regime. As a result of Armada's insolvency, the Company did not made further nominations since there was no assurance or security for Armada's performance for the balance period under the agreement.

In the year 2010 Armada filed its claim submission in an arbitration proceeding against the company in London for the year 2009 and 2010 and after all the repetitive challenges by the company w.r.t the defect in constitution of the Tribunal, the Tribunal passed an order in favour of Armada assessing the liability of the company as equivalent to Rs. 46 cr (including interest of Rs. 3.7 cr).

Aggrieved by the aforesaid order the company has filed a civil suit against Armada with the Hon'ble High Court at Calcutta claiming for damages for an amount of Rs 144 crores and cancellation of the aforesaid order being void and restraining Armada from giving any effect to the order passed by the Tribunal. An order was passed by the Hon'ble High Court at Calcutta restraining Armada to take any further steps to enforce the award passed by the Tribunal in India. The matter is presently sub judice before the Hon'ble High Court at Calcutta.

Meanwhile Armada executed an enforcement proceeding before the Federal Court of Australia, New South Wales which passed a freezing order of the assets held by the company in Australia. The company had challenged such enforcement proceedings before the same court and the final judgment is reserved by the court and is pending till date.

Armada later on filed its claim submission against the company for the non-performance of contract for the year 2011 before the same arbitral tribunal in London which passed a further award in favour of Armada assessing the liability of the company as equivalent to Rs.25.4 Crores (including interest of Rs. 1.2 Crores). An appeal was filed by the company against said order before High Court of Justice, Queen's Bench Division, Commercial Court in England which is pending before the said court. Thereafter, a petition was filed in High Court at Calcutta against the said award of the arbitral tribunal for its cancellation. Affidavit in oppositions were filed by both the parties and the matter is presently sub judice before the Hon'ble High Court at Calcutta.

During the year 2012, the company sought performance under the agreement from Armada, who failed to perform as per the terms of the agreement, which event was taken as repudiation of the agreement and the agreement was terminated. On the contrary, Armada filed another claim in March 2013 for non-performance for the year 2012 for an amount equivalent to Rs. 27 Crores and interest thereupon. The company has filed a counter claim for an amount equivalent to Rs 60 Crores and strongly opposed the claim of Armada before a newly constituted Arbitral Tribunal.


52


The Arbitration hearing was held in London in the month of December 2013 and the order was published in January 2014 wherein the argument of Armada in regard to five vessels out of six vessels nominated by Armada in 2012 was turned down by the Tribunal. As per the order the precise quantum of the claim in regard to one vessel which Armada succeeded will be determined jointly by the expert of both parties. The determination of such quantum is pending.

27.4 In September 2011 the company and Coeclerici Asia (Pte) Ltd (“Coeclerici”) entered into an agreement of sale and purchase of met coke as per which the company had to supply the cargo to Ceoclerici at a mutually agreed price by 31st Mar 2012. As per the terms of the agreement Coeclerici made an advance of USD 10 million to the company in Sept 2011. Owing to the sluggish market conditions, the parties could not arrive at a mutually agreed price, as such no cargo was supplied by 31.03.2012 and the entire advance of USD 10 million was required to be refunded by the company to Coeclerici.The company has already refunded USD 2 million till Sept'12 to Coeclerici and for the balance refund of USD 8 million, the company is awaiting the approval from Reserve Bank of India (“RBI”).

The company does not dispute the repayment of the balance amount to Coeclerici but has been unable to make any further payment until RBI approval. However, to secure its payment position, Coeclerici proceeded with the arbitration in London by filing its claim against the company. After all the arbitration proceedings, the Tribunal finally passed its order on against the company for an amount equivalent to Rs. 46.2 cr and interest thereupon.

The Amount of advance received is already accounted for under Advance received from Customers.

27.5 The company had filed proceedings before the High Court, Calcutta against Gregarious Estates Incorporated (“Gregarious” or “Owners”), Gabriel Petridis (President / Director of Gregarious), Tapas Kumar Mukhopadhay (Director of Gregarious), Arun Dua (Director of Gregarious) and Bhatia International Pte. Limited in relation to the Time Charter Agreement dated January 29, 2008 entered into between GNCL and Gregarious whereby Gregarious agreed to give on hire and GNCL agreed to hire a vessel for a period of 82 to 86 months.

In view of the fact that there was a change in management of Gregarious without the consent of the company, it was contended that as per the terms of the agreement the company has the right to terminate the said Agreement. Further the Agreement never came into effect as per the terms of the agreement Gregarious had failed to provide the calculations for ascertaining super profits (as described therein) to the company. The company had filed a suit in Calcutta High Court for a decree of Rs. 56.25 Crores and prayed for declaration that the arbitration agreement between the company and Gregarious be rendered illegal, null and void.

During pendency of above proceedings, Gregarious initiated arbitration proceedings against the company and served a claim submission for an amount equivalent to Rs 212 Crores and interest thereupon.

The matter was never heard on merits at all and only the matter of jurisdiction of English Courts/ Arbitral Tribunal in London was decided by the Indian Courts. The matter after being discharged by the Indian Court was referred to Arbitration Tribunal. The Arbitration hearing was held in London in the month of January 2014 and the order is presently reserved by the Tribunal. The management is confident of the outcome of case in favour of the company.

5 [28] Related Party Disclosures as required by Accounting Standard (AS-18) issued by the Institute of Chartered Accountants of India (ICAI), are given below:

A. Particulars of the Related Parties:

Associates

1 Gujarat NRE Limited (for Part of the Year)2 NRE Metcoke Ltd.3 Surajbari Traders Pvt. Ltd.4 Dharwad Traders Pvt. Ltd.5 Mandvi Traders Pvt. Ltd.6 Lunva Traders Pvt. Ltd.7 Critical Mass Multilink Ltd.8. Bharat NRE Coke Limited (Ceases to be Associate of the Company during the year)

Enterprises in which key management personnel have significant Influence

1 Gujarat NRE Mineral Resources Ltd.2 Gujarat NRE Energy Resources Ltd.3 Russel Vale Traders Pvt. Ltd.4 Bulli Coke Ltd.5 Bajrangbali Coke Industries Ltd.6 Mangal Crystal Coke Pvt. Ltd.7 Bharat NRE Coke Ltd. (for Part of the Year)

Enterprise in which key management person is a trustee

1 Girdharilal Arun Kumar Family Trust


53


B. Key Management Personnel & Relatives of Key Management Personell

1 Mr. A. K. Jagatramka – Chairman & Managing Director

2 Mr. P. R. Kannan – Chief Financial Officer

3 Mrs. Mona Jagatramka – Director

C. Transaction with Related Parties (Rs. in Crores)


i Sale/(Sales Return) of Goods/Services

- Associates – 46.99

- Enterprises in which key management personnel has significant influence – 0.01

ii Purchase of Goods /Services

- Associates 13.97 5.19

- Enterprises in which key management personnel has significant influence 22.55 2.13

iii. Remuneration

- Key Management personnel 0.76 8.74

- Relatives of Key Management Personnel – 1.22

iv Shares Allotted


v Share Warrant Deposit

Received


Forfeited

- Enterprises in which key management personnel has significant influence – 93.75

vi Advance against Share Warrant Deposit

Share Warrant Deposit

- Enterprises in which key management personnel has significant influence 65.26 –

vii Rent Paid

- Enterprises in which key management personnel is a trustee 0.76 0.25

viii Security Deposit Given

- Enterprises in which key management personnel has significant influence (35.00) –

- Enterprises in which key management personnel is a trustee (9.35) –

ix Loans / Advance Given/(Refunded)

- Associates 2.16 5.06

- Enterprises in which key management personnel has significant influence 14.34 –

x Guarantees/Collateral Securities Outstanding as at the Year end

- Given on behalf of Associates 215.88 –

- Given on behalf of Enterprises in which Key Management Personnel has

significant influence 89.85 –

- Given by Enterprises in which key management personnel has significant influence.

(By pledge of Shares) 10.00 –

- Given by Associates on behalf of the Company 155.00

- Given by Key Management Personnel on behalf of the Company 2777.17# 2298.2

- Given by Enterprises in which key management personnel has significant influence 346.78

# As per CDR Package, Associates of the Company, Key Management Personnel, Relatives of Key Management personnel & some of the Enterprises in which Key Management personnel has significant influence has given Guarantee on behalf of the Company to the extent of Loan Outstanding.


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6 [29]Segment Informations:

Segment wise Revenue, Results and Capital Employed for the Year ended 31st March,2014.The Company has three reportable segment i.e. " Coal & Coke" , " Steel" & " Mining" as primary business segments :i Primary Segment Reporting (by Business Segment): (Rs. in Crores)


Coal & Steel Mining Total Coal & Steel Mining TotalCoke Coke

Segment Revenue

(Net Sales/Income from segment)

External Sales 832.75 99.63 – 932.38 1495.73 217.30 316.37 2029.40

Inter-Segment Revenue 0.05 – 0.05 0.33 617.26 617.59

832.75 99.68 – 932.43 1495.73 217.63 933.63 2646.99

Less: Inter Segment Revenue 0.05 – 0.05 0.33 617.26 617.59

Total Segment Revenue 832.75 99.63 – 932.38 1495.73 217.30 316.37 2029.40

Segment Expenses

External Expenses 1595.12 130.24 – 1725.36 1153.66 234.31 1019.06 2407.03

Less: Inter Segment Expenses – 0.05 – 0.05 0.33 673.74 674.07

Total Segment Expenses 1595.12 130.19 – 1725.31 1153.66 233.98 345.32 1732.96

Segment Results

Profit/(Loss) before Tax & Interest (762.37) (30.56) – (792.93) 342.39 (17.01) (28.62) 296.76

Add:- Other Un-allocable Income Net of Expenditure – 340.98 8.62

Less:- Interest Expense 349.24 390.59

Less:- Provision for Tax (273.59) (198.03)

Net Profit / (Loss) (527.60) 112.82

Assets

Segment Assets* 2,463.29 449.86 – 2913.15 3,461.01 484.41 4,866.32 8811.74

Un-allocable Assets 1350.62 641.96

Total Assets 4263.77 9453.70

Liablities

Segment Liablities 354.75 31.67 – 386.42 924.93 44.93 649.44 1619.30

Un-allocable Liablities 94.99 57.07

Total Liablities 481.41 – – – 1676.37

*including captive windmills 5.65 318.12 6.54 343.30

Capital Expenditure 44.52 7.33 – 64.23 1.83 838.15

Non Cash Expenses

Depreciation & Amortisation 30.87 29.98 – 28.17 29.72 260.55

ii Secondary Segment Reporting ( by Geographical demarcation): (Rs. in Crores)


India Rest of Total India Rest of Totalthe World the World

Segment Revenue 932.38 – 932.38 1,548.09 481.31 2,029.40

Segment Assets 2,913.15 – 2,913.15 3,945.42 4,866.32 8,811.74

Capital Expenditure 51.85 – 51.85 66.06 838.15 904.21


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7 [30](a) On account of dilution in the Company's share holding in the nine Australian Subsidiaries, i.e Gujarat NRE Limited, Gujarat NRE India Pty Limited, Wonga Coal Pty Limited ,Gujarat NRE Coal (NSW)Pty Limited, Gujarat NRE Coking Coal Limited, Gujarat NRE Wonga Pty Limited, Gujarat NRE Resources NL, South Bulli Holdings Pty Limited & Gujarat NRE Properties Pty Limited, all of the Australian Subsidiaries ceases to be a subsidiary/ sub subsidiary of Gujarat NRE Coke Limited during the year. Gujarat NRE Limited continues as an associate of the company as on the reporting date.

[30](b)For the purpose of giving effect of deconsolidation, the Consolidated Audited Financial Statements of Gujarat NRE Coking Coal Limited as on 31.03.2013 (consolidated Account for five Australian Subsidiary namely Gujarat NRE Coking Coal Limited, Gujarat NRE Wonga Pty Limited, Gujarat NRE Resources NL, South Bulli Holdings Pty Limited & Gujarat NRE Properties Pty Limited), which were lodged with ASX on 15th August, 2013 have been used, instead of the standalone financials for the relevant date on which these sub subsidiary ceased to be a sub subsubsidiary of the company as these financials were not made available to us. As far as the remaning four Australian Subsidiary Companies are concerned, i.e. Gujarat NRE Limited, Gujarat NRE India Pty Limited, Wonga Coal Pty Limited ,Gujarat NRE Coal (NSW)Pty Limited, the management approved accounts for the relevant dates have been considered.

[30](c) For the purpose of Accounting of Associates as per AS-23, the management approved financials of Gujarat NRE Limited has been incorporated.

8 [31] The Shareholders of Gujarat NRE Coke Ltd.(GNCL) & Bharat NRE Coke Ltd.(BNCL) at their respective Shareholder's meeting held on 28.01.13 approved and adopted the scheme of amalgamation of BNCL with GNCL. However in view of subsequent development of reference of GNCL to CDR EG for its debt restructuring the said merger was not allowed byHon’ble High Court of Calcutta.

9 [32] The indicators of impairment listed in paragraph 8 to 10 of Accounting Standard (AS)- 28 “Impairment of assets” issued by ICAI have been examined by the management and on such examination, it has been found that none of the indicators are present in the case of the Company's assets except in the case as discussed above . A formal estimate of the recoverable amount has not been made, as there is no indication of a potential impairment loss.

10 [33] Exceptional items for the year ended 31st March'2014 represents net foreign exchange loss of Rs. 73.45 Crores (including Rs.25.85 Crores included in finance cost) ((Previous year Rs. 65.55 crores (including Rs. 18.66 crores included in finance cost)) due to unusual diminution in the value of Rupee as against the US Dollar during the year.

11 [35] The Consolidated Balance Sheet & Statement of Profit & Loss Account & Cash Flow Statement of Current Year & Previous Year are as such not comparable as all Australian Subsidiaries & Sub Subsidiary of the Company during previous year viz. Gujarat NRE Ltd., Wonga Coal Pty Limited,Gujarat NRE Coal (NSW)Pty Limited,Gujarat NRE Coking Coal Limited ,Gujarat NRE Wonga Pty Limited, Gujarat NRE Resources NL, South Bulli Holdings Pty Limited & Gujarat NRE Properties Pty Limited has ceased to be a Subsidiary of the Company

12 [36] Consolidated Financial Result for the 31st March' 2013 has been re-casted incorporating Audited Financial Statements of Gujarat NRE Ltd., Wonga Coal Pty Limited,Gujarat NRE Coal (NSW)Pty Limited and Consolidated Audited Financial Statements of Gujarat NRE Coking Coal Limited (i.e. consolidated for Gujarat NRE Coking Coal Limited ,Gujarat NRE Wonga Pty Limited, Gujarat NRE Resources NL, South Bulli Holdings Pty Limited & Gujarat NRE Properties Pty Limited, which were lodged with Australian Securities Exchage (ASX) on 15th August, 2013 ).

Consolidated Cash Flow Statement for the year ended 31st March, 2014

(Rs. in Crores)

For the Year ended For the Year ended31-Mar-14 31-Mar-13

A CASH FLOW FROM OPERATING ACTIVITIES

Net Profit / (Loss) before Tax (763.96) (96.02)

Adjustments for:

Depreciation / Other non cash items 61.30 322.81Net Loss/(Profit) on Sale/ Revaluation of Investment (16.69) 63.62Interest Paid / Payable 323.39 371.93Net Other Income (311.90) (0.67)Net Loss/(Profit) on Sale / Discard of Fixed Assets 0.70 (0.02)Employee Stock Option - Compensation (0.07) 0.67Interest Received / Receivable (6.39) (11.83)Extra Ordinary Items – 30.82Operating Profit before working Capital Changes (713.61) 681.31

Adjustments for:

Trade & Other Receivables 158.50 (287.10)Inventories 848.54 (197.27)Trade Payables (1,169.82) 52.78Cash Generated/(Used) from Operations (876.39) 249.72

Direct Taxes Paid / Refunds 189.57 6.36Cash Generated/(Used) from Operating Activities (686.82) 256.08

B CASH FLOW FROM INVESTING ACTIVITIES

Addition to Fixed Assets 182.26 (954.58)Sale of Fixed Assets 3,978.32 0.02Addition to Investments (198.85) –Sale of Investments – 0.74Interest Received 6.39 11.83Dividend / Misc Income 311.90 0.67Net Cash Generated/(Used) from Investing Activities 4,280.02 (941.32)

C CASH FLOW FROM FINANCING ACTIVITIES

Net Proceeds to Share Capital / Reserves (1,512.59) 330.28Deposit against Share Warrant – 2.64Advance against Share Warrant/ Share Application Money 78.65 –Increase in Long / Short term borrowing (1,914.93) 753.57Interest Paid (326.23) (363.18)Dividend & Dividend Tax Paid (0.07) (9.63)Miscellaneous Expenditure 0.05 (4.19)Net Cash Generated/(Used) from Financing Activities (3,675.12) 709.49

Net Increase / (Decrease) in Cash & Cash Equivalents (81.92) 24.25

Cash & Cash Equivalents (Opening Balance) 115.20 90.95Cash & Cash Equivalents (Closing Balance)* 33.28 115.20

* Includes Dividend accounts of Rs. 1.85 crores( Previous Year 1.92 Crores)

In terms of our report of even date annexed hereto




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58

Notes


GUJARAT NRE COKE LIMITEDCIN:L51909WB1986PLC040098

Registered Office:22, Camac Street, Block-C,5th Floor, Kolkata-700016Phone: +91-33-2289-1471; Fax: 91-33-2289-1470; Email: [email protected]; web: www.gujaratnre.com

ATTENDANCE SLIP

Shareholder's Folio Number/ Name of the Shareholder Number of Shares held

DP Id No. & Client Id No. (in block letters) Equity “B” Equity Total

Email :

I hereby record my presence at the 27th Annual General Meeting of the Company to be held at Vidya Mandir, 1, Moira Street, Kolkata-700017 on Tuesday, September 30, 2014 at 10.30 a.m.

Name of the Proxy*………………………………………………………………….................................................(IN BLOCK LETTERS)(To be filled if the Proxy attends instead of Shareholder)

Signature of the Shareholder/Proxy(Please complete this Attendance Slip and hand it over at the entrance of the Meeting Hall)

Note: Please bring the copy of the Annual Report 2013-14 to the Meeting Hall

ELECTRONIC VOTING PARTICULARS

Type of Share EVSN (E-voting Sequence Number) User ID PasswordEquity Share 140818043

Please refer to Note no. 11-III of the Notice“B” Equity Share 140818045

Please refer to the AGM Notice for e-voting instructions.

GUJARAT NRE COKE LIMITEDCIN:L51909WB1986PLC040098

Registered Office:22, Camac Street, Block-C,5th Floor, Kolkata-700016Phone: +91-33-2289-1471; Fax: 91-33-2289-1470; Email: [email protected]; web: www.gujaratnre.com

PROXY FORM

Pursuant to Section 105(6) of the Companies Act, 2013 and Rule 19(3) of the Companies(Management and Administration) Rules,2014

Name of the Shareholder(s): .................................................................................................................................................Registered Address: .............................................................................................................................................................E-mail id : ..............................................................................................................................................................................Folio No./ Dp Id &Client Id No. : ..............................................................................................................................................I/We, being the member(s),holding……………………………………..shares of Gujarat NRE Coke Limited hereby appoint:(1) Name ………………………………………………………..........................................................................................…

Address …………………………………………………....................................................................................................E-mail id ……………………………………………… Signature……………………...……… or failing him/her

(2) Name ………………………………………………………..........................................................................................…Address …………………………………………………....................................................................................................E-mail id ……………………………………………… Signature……………………...……… or failing him/her

(3) Name ………………………………………………………..........................................................................................…Address …………………………………………………....................................................................................................E-mail id ……………………………………………… Signature……………………...……… ...........................

✂

✂

P.T.O

as my/ our proxy to attend and vote (on a poll) for me/us and on my/our behalf at the 27th Annual General Meeting (AGM) of the Company, to be held on Tuesday, September 30,2014 at 10.30 a.m. at Vidya Mandir, 1 Moira Street, Kolkata-700017 and at any adjournment thereof in respect of such resolutions as are indicated below:

Resolution ResolutionsNo.

1. Adoption of Audited Statement of Profit & Loss and Balance Sheet for the year ended March 31, 2014 and Reports of Directors' and Auditors' thereon.

2. Non filling up of the vacancy caused by retirement of Dr. Mahendra Kumar Loyalka, who retires by rotation and does not seek re-appointment.

3. Re-Appointment of M/s N.C. Banerjee & Co. Chartered Accountants as Statutory Auditors.

4. Appointment of Mr. Sisir Kumar Mukherjee (DIN - 03054675) as an Independent Director.

5. Appointment of Mr. Sananguly Murari (DIN - 00573083) as an Independent Director.

6. Appointment of Mr. Gopal Prasad Dokania (DIN - 03267986) as an Independent Director.

7. Ratification of Cost Auditors' remuneration.

8. Approval of Minimum Remuneration payable to Mr. Arun Kumar Jagatramka in case of loss/ inadequate profit.

9. Authority to make investment(s) in excess of limits under section 186 of the Companies Act,2013.

10. Issue of 2,90,00,000 convertible warrants to promoter/ non promoter entity(ies) on preferential basis.

11. Reset of conversion price of Foreign Currency Convertible Bonds (FCCBs).

Signed this……………………………day of …………………………….2014

Member's Folio/ DP ID- Client ID No………………………….. Signature of Shareholder(s)……….........……………………

Signature of Proxy holder(s)………………………....................………………………………

Note: 1. This form of proxy in order to be effective should be duly completed and deposited at the Registered Office of the Company, not less than 48 hours before the commencement of AGM.

2. For the text of the Resolution, Statement & Notes, please refer to the Notice convening the 27th Annual General Meeting dated 14th August, 2014.

Affix RupeeOne

RevenueStamp

✂

If undelivered, please return to :

Niche Technologies Pvt. Ltd.D-511, Bagri Market, 5th Floor,71, B. R. B. Basu RoadKolkata - 700 001

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