The Directors have pleasure in submitting 22nd Annual Report of the Company together with Audited

Statements of Accounts for the Financial Year ended 30th June, 2015.

1. FINANCIAL RESULTS

The Company's financial performance for the financial year under review along with previous year figures is given hereunder:

                                                       (Amount in lacs)

Particulars                           For the Year        For the Year
                                         ended               ended
                                       30.06.2015         30.06.2014

Net Sales /Income from Business          2687.49            8366.77
Operations

Less: Excise Duty                        1137.51            3955.80

Net Sales                                1549.98            4410.97

Add: Other Income                        1253.94              38.50

(Increase) / Decrease in stock           (41.20)             338.24

Total                                    2845.12            4111.23

Less: Total Expenditure                  2480.75             5060.00

Operating Profit                         364.87             (948.77)

Less: Interest                           696.10              440.06

Less Depreciation                        303.65              269.55

Less: Exceptional Item                   (0.21)               2.61

Profit beforelax                        (635.09)           (1655.77)

Less: Provision for taxes                   -                  -

Current Tax                                 -                   -

Deferred Tax                            (215.19)           (512.87)

Earlier Year: Deferred Tax                  -                  -

Earlier Year: Income Tax                    -                   -

Profit / (Loss) after tax               (419.90)          (1142.90)

In view of accumulated losses of the Company, your Directors have not recommended any dividend this year also.

3. TRANSFER OF UNCLAIMED DIVIDEND TO INVESTOR EDUCATION AND PROTECTION FUND.

In terms of Section 125 of the Companies Act, 2013, the Company has transferred Unpaid/ unclaimed dividend of F. Y. 2006-07 of Rs. 3,74,380./- on 07.11.2014 to Investor Education and Protection Fund. Unclaimed / unpaid Dividend related to the financial year 2007-08 and 2008-09 is due for transfer to the Investor Education and Protection Fund established by the Central Government.

4. REVIEW OF BUSINESS OPERATIONS AND FUTURE PROSPECTS

During the period under review, the Company has achieved net sales of Rs. 2,687.49 Lacs in the Financial Year 2014-15 as compared to Rs. 8,366.77 Lacs in the last Financial Year. The sales of Company outside the State of Rajasthan were affected due to increase in import fee by Jharkhand Government and increase of Export fee by Rajasthan Government and franchisee agreement entered with a brewery in Patna for Bihar State.

Operating profit for the year was Rs. 359.75 Lacs against operating loss of Rs. 948.77 lacs during the preceding year mainly due to other income. The Company's operating results continue to be adversely affected by various factors, mainly the state regulated pricing having direct impact on revenues and the costs being accelerated by inflationary conditions.

In the meanwhile steps taken by, the management to address the controllable issues, including operational efficiency and cost & expense reduction; and other appropriate measures as price increase, fresh investments and contract bottling for others are expected to result in sustainable cash flows and profitability. The management is of the opinion that subsequent to these effective remedial significant steps (including upward renegotiation of prices with the buyers being the State Governments) reversal of the trend would arise that shall result in positive and sustainable cash inflows.

The Company's Restaurant at Amber Fort, Jaipur and Hanwant Mahal, Jodhpur on lease basis. Net sales of the Company's Restaurant Business have improved during the year from Rs. 3.47 Crores to Rs. 4.20 Crores. The Company is making efforts to improve sales in current financial year. Note No. 41 of the financial Statements for the period ended June 30th, 2015 shows the segment reporting of Brewery and Hospitality Business of the Company.

5. MATERIAL CHANGES AND COMMITMENT IF ANY AFFECTING THE FINANCIAL POSITION OF THE COMPANY OCCURRED BETWEEN THE END OF THE FINANCIAL YEAR TO WHICH THIS FINANCIAL STATEMENTS RELATE AND THE DATE OF THE REPORT

No material changes and commitments affecting the financial position of the Company occurred at the end of the financial year to which this financial statement relate on the date of this report

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

The information pertaining to conservation of energy, technology absorption, Foreign exchange Earnings and outgo as required under Section 134 (3)(m) of the Companies Act, 2013 read with Rule 8(3) of the Companies (Accounts) Rules, 2014 is furnished in "Annexure-I" and is attached to this report.

7. RESEARCH AND DEVELOPMENT

Particulars regarding Research & Development as required under Section 134 (3)(m) of the Companies Act, 2013 read with Rule 8(3) of the Companies (Accounts) Rules, 2014 is furnished in "Annexure-I" and is attached to this report.

8. STATEMENT CONCERNING DEVELOPMENT AND IMPLEMENTATION OF RISK MANAGEMENT POLICY OF THE COMPANY.

The development and implementation of a Risk Management Policy after identifying the following elements of risks which in the opinion of the Board may threaten the very existence of the Company itself.

a) Operational, business and market risks.

b) Decrease in product prices

c) Customer defaults

d) Interest rates risk and inventory carrying risk.

9. DETAILS OF POLICY DEVELOPED AND IMPLEMENTED BY THE COMPANY ON ITS CORPORATE SOCIAL RESPONSIBILITY INITIATIVES

Since the Company doesn't fall under the companies required to constitute the Corporate Social Responsibility Committee as per Section 135 of the Companies Act, 2013. Therefore, the Company has not developed and implemented any Policy on Corporate Social Responsibility as the said provisions are not applicable.

10. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS MADE UNDER SECTION 186 OF THE COMPANIES ACT, 2013.

There were no loans, guarantees or investments made by the Company as specified under Section 186 of the Companies Act, 2013 during the year under review and Particulars of loans given, investments made, guarantees given and securities provided along with the purpose for which the loan or guarantee or security is proposed to be utilized by the recipient are provided in the standalone financial statement (Please refer to Note No. 17 to the standalone financial statement).

11. PARTICULARS OF CONTRACTS OR ARRANGEMENTS MADE WITH RELATED PARTIES.

All related party transactions are in the ordinary course of business and at arms length basis, which are not material in nature too, hence, outside the scope of Section 188 (1) of the Act. None of the transaction is without approval of the Audit Committee and every such transaction is being placed before for review periodically.

12. EXPLANATION OR COMMENTS ON QUALIFICATIONS, RESERVATIONS OR ADVERSE REMARKS OR DISCLAIMERS MADE BY THE AUDITORS AND THE PRACTICING COMPANY SECRETARY IN THEIR REPORTS.

Statutory Auditors

M/s R. K. RELAN & CO., Chartered Accountants, FRN 002267N, the Statutory Auditors of the Company, were appointed as Statutory Auditors for a period of 5 years in the Extra Ordinary General Meeting held on 07th April, 2014 and are eligible for reappointment, at ensuing Annual General Meeting of the Company. They have confirmed their eligibility to the effect that their re-appointment, if made, would be within the prescribed limits under the Act and that they are not disqualified for re-appointment.

The Notes on financial statement referred to in the Auditors' Report are self-explanatory and do not call for any further comments. The Auditors' Report does not contain any qualification, reservation or adverse remark except point no. VII (b) of the Annexure to the Auditors' Report regarding Statutory Dues.

Board's Response:-

In point no. VII (b) of the Annexure to the Auditors' Report regarding Statutory Dues, in respect of demand of sales tax of Rs. 84.66 Crores the Actual position has been explained in note no. 31 of the Financial Statemants and the Company has obtained stay order from the Rajasthan High Court for the same till the disposal of Appeal.

Secretarial Auditor

The Board has appointed M/s. B. Chakraborty & Co., Company Secretaries Firm, to conduct Secretarial Audit for the financial year 2014-15. The Secretarial Audit Report for the financial year ended June 30, 2015 is annexed herewith marked as "Annexure-M" to this Report. The Secretarial Audit Report does not contain any qualification, reservation or adverse remark except delay in filing of some forms and returns to the RoC.

Board Response:-

The delay in filing of some forms and returns accrued due to resignation of authorized person i.e. Company Secretary of the Company for the time being. However Company has appointed a Company Secretary for compliances of applicable laws and regulations.

13. COMPANY'S POLICY RELATING TO DIRECTORS APPOINTMENT, PAYMENT OF REMUNERATION AND DISCHARGE OF THEIR DUTIES.

The Company's Policy relating to appointment of Directors, payment of Managerial remuneration, Directors' qualifications, positive attributes, independence of Directors and other related matters as provided under Section 178(3) of the Companies Act, 2013 is being dealt in the Corporate Governance Report under Nomination and Remuneration Committee section.

14. EXTRACT OF ANNUAL RETURN

The extracts of Annual Return in MGT- 9 pursuant to the provisions of Section 92 read with Rule 12 of the Companies (Management and Administration) Rules, 2014 is furnished in "Annexure-III" and is attached to this Report.

15. NUMBER OF BOARD MEETINGS CONDUCTED DURING THE YEAR UNDER REVIEW

The Company had Eight (8) Board Meetings during the financial year under review.

16. DIRECTORS' RESPONSIBILITY STATEMENT

Pursuant to the provisions of Section 134(5) of the Companies Act, 2013 with respect to the Directors' Responsibility Statement, it is hereby confirmed that:

a. in preparation of the annual accounts for the financial year 2014-15, the applicable accounting standards have been followed along with proper explanation relating to material departures;

b. the accounting policies selected and applied are consistent and judgments and estimates made are reasonable and prudent so as to give a true and fair view of the state of affairs of the company as at 30 th June, 2015 and of the profit / (loss) of the company for year ended on that date;

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

d. the annual accounts have been prepared on a going concern basis;

e. the directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

17. SUBSIDIARIES, JOINT VENTURES AND ASSOCIATE COMPANIES The Company has no Subsidiary, Joint Venture or Associate Company.

18. DEPOSITS

The Company has neither accepted nor renewed any deposits during the year under review.

19. DIRECTORS

* Smt. Kavita Bali, who was appointed as Additional Director in the category of Non-Executive on 08.06.2015 and holds the said office till the conclusion of next Annual General Meeting of the Company. A Notice has been received from a member proposing her candidature for re-appointment.

* Shri Sanjiv Bali, Managing Director of the Company was reappointed by the Board on 30.07.2015 subject to approval of the members at the ensuing Annual General Meeting.

* Shri K. C. Garg, Whole Time Director of the Company was reappointed by the Board on 30.09.2015, subject to the approval of the members at the ensuing Annual General Meeting.

* Shri Rajiv Bali and Shri Kamal Dutt, Non-Executive Director, who are liable to retire by rotation, retires at this Annual General Meeting and being eligible offer himself for re-appointment.

20. DECLARATION OF INDEPENDENT DIRECTORS.

The Independent Directors have submitted their disclosures to the Board that they fulfill all the requirements as stipulated in Section 149(6) of the Companies Act, 2013 so as to qualify themselves to be appointed as Independent Directors under the provisions of the Companies Act, 2013 and the relevant rules.

21. STATUTORY AUDITORS.

M/s R. K. RELAN & CO., Chartered Accountants, FRN 002267N, the Statutory Auditors of the Company, were appointed as Statutory Auditors for a period of 5 years in the Extra Ordinary General Meeting held on 07th April, 2014. Their continuance of appointment and payment of remuneration are to be confirmed and approved in the ensuing Annual General Meeting. The Company has received a certificate from the above Auditors to the effect that if they are reappointed, it would be in accordance with the provisions of Section 141 of the Companies Act, 2013.

22. RISK MANAGEMENT POLICY

The risk management includes identifying types of risks and its assessment, risk handling and monitoring and reporting. The implementation of risk management policy has also been covered in the Management Discussion and Analysis which forms part of this report.

Risk evaluation and management is an ongoing process within the Organization. Your Company has comprehensive risk management policy which is periodically reviewed by the Committee and Board of the Company.

23. DISCLOSURE OF COMPOSITION OF AUDIT COMMITTEE AND PROVIDING VIGIL MECHANISM

The Audit Committee consists of the following members:

1) Shri J. M. Malhotra, Chairman

2) Shri Rajiv Bali, Member

3) Shri S. K. Chhibber, Member

The above composition of the Audit Committee consists of all non executive directors with majority of independent directors.

The Company has established a vigil mechanism and overseas through the committee, the genuine concerns expressed by the employees and other Directors. The Company has also provided adequate safeguards against victimization of employees and Directors who express their concerns. The Company has also provided direct access to the Chairman of the Audit Committee on reporting issues concerning the interests of Company employees and the Company.

24. DISCLOSURE UNDER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013 AND PROVIDING VIGIL MECHANISM.

The Company has no women employees, so the requirements of The Sexual Harassment of Women at the Workplace (Prevention, Prohibition & Redressal) Act, 2013 are not applicable on the Company.

25. SHARES

LISTING OF SECURITIES OF COMPANY

The Equity Shares of the Company continue to be listed at Bombay Stock Exchange Ltd. (BSE).

DEMATERIALISATION

Trading of Equity Shares of the Company in dematerialized form is compulsory for all shareholders in terms of the Notification issued by the Securities and Exchange Board of India (SEBI). Your Company has achieved higher level of dematerialization with 87.09% of the total number of Equity Shares being held in the electronic mode with the two depositories.

26. PARTICULARS OF EMPLOYEES

The information required under Section 197 of the Act read with rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are given in the "Annexure-IV".

27. CORPORATE GOVERNANCE REPORT AND MANAGEMENT DISCUSSION ANALYSIS

A separate report of the Board of Directors on Corporate Governance is included in the Annual Report as "Annexure-VI" and the certificate from M/s. B. Chakraborty & Co., Practicing Company Secretary (CoP No. 9519) confirming compliance with requirements of Corporate Governance as stipulated in Clause 49 of Listing Agreement is annexed as "Annexure-V".

28. MANAGEMENT DISCUSSION ANALYSIS

Management Discussion and Analysis Report as required by Clause 49 of Listing Agreement with Stock Exchanges is given in "Annexure-VII" forming part of this report.

29. INTERNAL FINANCIAL CONTROL

Company has a proper and adequate system of internal control to oversee the Company's financial reporting process, disclosure of financial information, reviewing the performance of statutory and internal auditors with management, adequacy of internal audit function and internal control system, related party transactions etc., and for this purpose the Company has a well constituted Audit Committee headed by a Non-Executive independent Director. Further, the Company's Internal Auditors verify the information concerning the reliability of the financial statements as well as the compliance with your Company policies so as to maintain accountability of all its assets and correctness of recorded transactions.

30. EVALUATION OF BOARD AND INDIVIDUAL DIRECTORS

Pursuant to the Section 134(3)(p) of the Companies Act, 2013 and Clause 49 of Listing Agreement a formal evaluation has been made by the Board of its own performance and that of its committees and individual Directors.

31. ACKNOWLEDGEMENTS

Your Directors place on record their sincere thanks to bankers, business associates, consultants, various Government Authorities and Stakeholders of the Company for their continued support extended to your Company's activities during the year under review. Your Directors also acknowledges gratefully the shareholders for their support and confidence reposed on your Company.

                          For and on behalf of the Board of Directors
                                       Mount Shivalik Industries Ltd.

                          (B. D. Bali)                 (Sanjiv Bali)
          Chairman & Managing Director             Managing Director
                          DIN:00226629                  DIN:00226806