FOR THE FINANCIAL YEAR 2015-16
Ahmedabad Steelcraft Limited
Your Directors have pleasure in presenting their 44thAnnual Report on thebusiness and operations of the company together with the Audited Statement of Accounts forthe year ended 31st March 2016.
The Financial Performance for the year ended March 2016 is summarized as under and theDirectors recommend appropriation of Profit as under:
| || ||(Rupees in Lakhs) |
|Particular ||Year ended 31st March 2016 ||Year ended 31st March 2015 |
|Turnover ||319.41 ||250.56 |
|Profit/(Loss) before taxation ||81.26 ||(227.06) |
|Less: Tax Expense || || |
|a) Current Tax || ||0.20 |
|b) Deferred tax expenses ||(2.92) ||(4.33) |
|c) Provision for wealth tax || ||0.27 |
|Profit/(Loss) after tax ||84.18 ||(223.20) |
|Less: Appropriation || || |
|a) Transferred to General Reserve || || |
|b) Proposed Dividend on Equity Shares ||30.69 || |
|c) Tax on Dividend ||6.42 ||0.32 |
|Add: Balance B/F from the previous year ||1609.90 ||1833.42 |
|Balance Profit / (Loss) C/F to the next year ||1665.97 ||1609.90 |
State of Companys Affairs and Future Outlook:
The income of the company during the year was Rs. 3.19 Crores in comparison of Rs. 2.50Crore in the previous year. The Company continues to be partner of LLPs. The operationalactivity has commenced and the management is confident in achieving higher amount ofprofits in current and upcoming years.
The Company has earned profit of Rs. 84.18 Lacs during the year.
The Company has also put on trial new products that is toilets registered under SwachBharat Abhiyaan and the management is hopeful of positive outcome in the said project.However the said project is dependent upon the Government policies and other RegulatoryBodies which may have an adverse effect on its working.
The information on conservation of energy technology absorption and foreign exchangeearnings and outgo pursuant to Section 134(3) (m) of the Companies Act 2013 read withthe Rule 8(3) of the Companies (Accounts) Rules 2014 is given in the ManagementDiscussion and Analysis Report. The details pursuant to remuneration of Directors andemployees in terms of Section 197(12) of the Companies Act 2013 read with Rule 5(1) ofthe Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 aregiven at Annexure-I.
The trading activities of the Company mostly comprises of export of Mild steel section(Non-Alloy) which are subject to Government policies and other Global factor which hasdirect effect on the operational activities of trading. However the Company substantiatedpresence in global market and has enough capacity to face the uneven situation in thecourse of its operation which is within its control.
Further to initiate the programme of Government in respect of Swatch Bharat theCompany has initiated a project of toilets and has put same in the market on trial basis.The long term vision of this project would enhance and appreciate the value of itsstakeholders. However the competition in this field will intensify due to present of manyplayers in the same business. The Company will need to make sure that they have rightcapabilities and qualities for achieving its targets.
The Company has also made capital contribution in Limited Liability Partnership engagedin real estate and may independently start this activities considering the fact that thedemand for private capital for real estate investment and supporting infrastructure hasincreased enormously. This is due to great migration to the cities growing population andswelling middle class creating the urge for more urban real estate. Real Estate as anasset class is changing fast. Mega real estate manager are emerging which are buildingand investing in real estate on an epic scale yet small specialist manager are alsoplaying significant part. The landscape is becoming more wide spread and complex with thewider range of risk and return then ever plus new drivers of value. However GovernmentRegulations may impact and disturb the real estate economy but future is far better asgradually the real estate sector will grow steadily.
Considering the overall improvement in performance as well as the need to conservecapital for continued growth the Directors recommend Dividend of Re. 0.75/- per EquityShare of Rs. 10/- each for the year ended March 31 2016.
AMOUNTS TRANSFERRED TO RESERVES:
No amount has been transferred to General Reserve out of Profit.
EXTRACT OF ANNUAL RETURN:
The extract of Annual Return in format MGT -9 for the Financial Year 2015-16 has beenenclosed with this report as
DETAILS OF SUBSIDIARIES COMPANIES ASSOCIATE COMPANY & LLP/PARTNERSHIP
|Sr. No. Name of Company ||Nature of Relationship ||No. of Share hold/ Capital Contribution |
|1. Light Works LLC ||Associate Company ||50% |
|2. Endor Properties LLP ||Partner ||6.22% |
|3. Tesla Properties LLP ||Partner ||11.72% |
|4. View Port Properties LLP ||Partner ||2.92% |
|5. Aavkar Projects ||Partner ||11.10% |
|6. Aavkar Realty ||Partner ||46% |
|7. Farpoint Properties LLP ||Partner ||2.885% |
*There is no Subsidiary of Company hence no such information is provided. Theperformance of Associate Comapny has been given in Note No. 10 of Schedule Y which is selfexplaintory.
The Board comprises of Nine Directors as on March 31 2016 viz. Shri AshokGandhi(Chairman and Independent Director) Shri Anand V Shah(Managing Director) ShriDarshan Jhaveri(Managing Director) Shri Shashank Shah(Executive Director) Shri AnandJhaveri(Executive Director) Shri Viral Jhaveri(Executive Director) Shri KanishkaKaji(Director) Smt. Nita G. Shah(Whole time Director) and Shri Shrujal Patel(Director).
(a) Independent Non executive Directors
(i) Shri Ashok Gandhi
(ii) Shri Kanishka Kaji
(iii) Shri Shrujal Patel
(b) Woman Director
In terms of the provisions of Section 149 of the Companies Act 2013 and the ListingRegulations specified Companies are required to have at least one Woman Director in theirBoard. Smt Nita G Shah was appointed as on 22nd January 2015 as Whole TimeDirector on Board.
(c) Chairman of the Board
Shri Ashok C Gandhi DIN 00022507 has been Chairman and Independent Director since 10thJune 1994.
(d) Managing Director & CEO
Shri Anand Shah DIN 00017452 has been the Managing Director since 17thOctober 1998 and CEO from 30th July 2015.
Shri Darshan Jhaveri DIN 00489773 has been the Managing Director since 29thJune 1995.
Shri Anand Jhaveri has been the CFO of the Company since 30th July2015.
(e) Appointment/ Re-appointment/ Resignation/ Retirement of Directors
In order to ensure compliance with Section 152 (6) of the Act the Board has consideredShri Anand V. Shah Managing Director and Shri Viral Jhaveri Executive Director as liableto retire by rotation and being eligible offer themselves for reappointment.
NUMBER OF BOARD MEETINGS:
During the Financial Year 2015-16 the following meetings of the Board of Directors ofthe company were held.
|Sr. No. Date of Board Meeting ||No. of Director Present in the Meeting |
|1. 28-05-2015 ||Seven Directors were Present out of Nine Directors. |
|2. 30-07-2015 ||All Nine Director were Present |
|3. 27-10-2015 ||All Nine Director were Present |
|4. 20-01-2016 ||All Nine Director were Present |
|5. 31-03-2016 ||Eight Directors were Present out of Nine Directors. |
System for Internal Financial Controls and its adequacy
The Financial Statements are prepared based on Computer system outputs. Responsibilityof preparation of Financial Statements is entrusted to a dedicated unit which iscompletely independent of business risk audit or other functions. This unit does notoriginate accounting entries except for limited matters such as Share Capital Taxes andTransfers to Reserves. The Company has implemented adequate procedures and internalcontrols which provide reasonable assurance regarding reliability of financial reportingand preparation of Financial Statements and that such internal financial controls wereadequate and were operating effectively during the year.
PARTICULARS OF LOAN GUARANTEES AND INVESTMENTS UNDER SECTION 186:.
The loans and advances given to Light Work LLC has been provided to meet the workingcapital requirement of the company in the financial year 2015-16. The company is regularlyreceiving the Interest on loan.
During the financial year 2015-16 the Company has not given any loan to any otherCompany including Associate Concern.
The investment in other securities is within the authority given to the Board by theshareholders under Section 372A of the Companies Act1956 /Section 186 of the CompaniesAct 2013.
PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES:
All the transactions entered by Company with the Related Parties were in ordinarycourse of business and are at Arms length. Remuneration paid to the WorkingDirectors i.e. Managing Directors& Executive Directors is in respect of their timeinvolvement in development of Company. Other transactions are in the form of capitalcontribution. The dividend/Profit earned from this associate is tax free in the hands ofCompany. All the Compliances under the Companies Act 1956/2013 have been done.
EXPLANATION TO AUDITORS REMARKS
The remarks made by the Auditors in their Report have been suitably dealt with in theschedules and notes and therefore do not call for any further clarification.
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION FOREIGN EXCHANGE EARNINGS AND OUTGO:
The details of Energy Technology Absorption Foreign Exchange Earnings and Outgo areas under:
A. Conservation of Energy: Particulars with respect to Conversation of Energy are notapplicable as the Company has not done any manufacturing activities.
|B. (1) Research and Development ||: Not Applicable |
|(2) Technology absorption ||: Not Applicable |
C. Foreign Exchange earnings and outgo:
|(1) Activities relating the export ||: Company exports Mild steel related items. |
|(2) Foreign Exchange earned ||: Rs. 28280739 |
|(3) Foreign Exchange used ||: Nil |
RISK MANAGEMENT POLICY:
The Company has developed a very comprehensive risk management policy and the same isreviewed by the Audit Committee at periodical intervals which in turn informs the Boardabout the risk assessment and minimization procedures adopted by the management.Suggestions or guidance given by the audit committee members are immediately implemented.At the corporate level major risks are reviewed by the Managing Directors and directionsin this regard are issued accordingly.
DETAILS OF DIRECTORS AND KEY MANAGERIAL PERSONNEL:
|NAME OF DIRECTOR ||DIN ||DESIGNATION ||DATE OF APPOINTMENT ||RESIDENTIAL ADDRESS |
|ASHOK C.GANDHI ||00022507 ||INDEPENDENT DIRECTOR ||10/06/1994 ||2 PRABHAT SOCIETY PALDI AHMEDABAD-7. |
|ANAND V. SHAH ||00017452 ||MANAGING DIRECTOR ||17/10/1998 ||VRUNDAVAN 53 VIJAY PARK C. G. ROAD AHMEDABAD-09. |
|DARSHAN A. JHAVERI ||00489773 ||MANAGING DIRECTOR ||29/06/1995 ||FAGUN DR. V.S. MARG P.O. POLYTECHNIC AHMEDABAD-15 |
|SHASHANK I. SHAH ||00545449 ||WHOLE TIME DIRECTOR ||20/03/1995 ||MADHUBAN DR. V.S. ROAD NR. APANG MANAV MANDAL AHMEDABAD-15 |
|ANAND N. JHAVERI ||00489833 ||WHOLE TIME DIRECTOR ||20/03/1995 ||ANAND BUNGLOW CHANDRA VIHAR SOCIETY AHMEDABAD-15 |
|VIRAL A. JHAVERI ||00489644 ||WHOLE TIME DIRECTOR ||25/06/2002 ||SHAGUN NR. BANK OF INDIA SOCIETY AMBAWADI AHMEDABAD-15 |
|NITA GIRISH SHAH ||03225876 ||WHOLE TIME DIRECTOR ||22/01/2015 ||KAJAL VIJAYPARK OPP MUNICIPAL MARKET NAVRANGPURA AHMEDABAD-09 |
|KANISHKA H. KAJI ||02329312 ||INDEPENDENT DIRECTOR ||10/06/1994 ||503 SAMRUDHI SATTARTALUKA SOCIETY OPP. HIGH COURT LANE AHMEDABAD-14 |
|SHRUJAL. S. PATEL ||02087840 ||DIRECTOR ||23/01/2014 ||625/8 VASANT BAUG OPP. GULBAI TEKRA PUMPING STATION ELLISBRIDGE AHMEDABAD-06. |
COMPARISON OF REMUNERATION TO DIRECTORS AND EMPLOYEES:
There is no increase in the remuneration payable to Directors in Comparison to increasein the salary of employee. The Salary rise is based on the inflation data. The previousyear increase in salary of Director is after two years. As such the rise in the salary isat par with other employee of the Company. The Performance of the Company has beenaffected by Global recession and economic slowdown in the Indian economy.
In comparison to the Remuneration of Directors and other employees is as under:
1) Median of Directors remuneration:- Rs. 900000/- per annum.
2) Median of employees remuneration:- Rs. 303625/- per annum.
DETAILS OF SIGNIFICANT & MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS ORTRIBUNAL:
No order has been passed by the Court/Tribunal during the financial year 2015-2016.
Deposits (As per the Definition Section 2(31) of the Companies Act 2013)
The following details of deposits covered under Chapter V of the act:
I. Deposits Accepted during the year: Nil
II. Remained unpaid or unclaimed as at the end of the year: Nil
III. Whether there has been any default in repayment of deposits or payment of interestthereon during the year and if so number of such cases and the total amount involved-N.A.
a. At the beginning of the year: Nil
b. Maximum during the year: Nil
c. At the end of the year: Nil
IV. The details of deposits which are not in compliance with the requirements ofChapter: There is no such Deposit held by the Company.
RECEIPT OF ANY COMMISSION BY MANAGING DIRECTOR / WHOLE TIME DIRECTOR FROM A COMPANY ORFOR RECEIPT OF COMMISSION / REMUNERATION FROM IT HOLDING OR SUBSIDIARY:
Company is not paying any commission to its Director
DECLARATION BY INDEPENDENT DIRECTOR:
The Company has received declaration from all the Independent Directors under theCompanies Act 2013 and rules made there under.
SECRETARIAL AUDIT REPORT:
In terms of Section 204 of the Companies Act 2013 and the Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014 the Company has appointed M/s D. N.Motwani & Co. to undertake Secretarial Audit. The Secretarial Audit Report submittedby M/s. D. N. Motwani & Co. is furnished as Annexure II.
The explanation pertaining to Para 3(i) of the Secretarial Audit Report followingexplanation is furnished:-
The Company is in the process of appointing Company Secretary undersection 203 of the Companies Act 2013.
Corporate Social Responsibility (CSR) Policy:
The Company is not falling within the criteria of Section 135 of the Companies Act2013 and hence the Company is not required to form CSR committee.
The Audit Committee comprises of Shri Kanishaka Kaji Shri Ashok C. Gandhi Shri AnandV. Shah and Shri Darshan A. Jhaveri. All the recommendations made by the Audit Committeewere accepted by the Board.
The Vigil Mechanism of the Company incorporates Whistle Blower Policy in terms of theListing Agreement. Protected disclosures can be made by a Whistle Blower through a mail ora letter to the Chairman of the Company. The Policy on Vigil Mechanism and Whistle BlowerPolicy may be accessed on Companys Website.
Statement Indicating the Manner in which Formal Annual Evaluation has been made by theBoard of its own Performance its Directors and that of its Committees:
During the year the Board adopted a formal mechanism for evaluating its performanceand as well as that of its Committees and individual Directors including the Chairman ofthe Board. The exercise was carried out through a structured evaluation process coveringvarious aspects of the Boards functioning such as composition of the Board &committees experience & competencies performance of specific duties &obligations governance issues etc. Separate exercise was carried out to evaluate theperformance of individual Directors including the Board Chairman who were evaluated onparameters such as attendance contribution at the meetings and otherwise independentjudgement safeguarding of minority shareholders interest etc.
The evaluation of the Independent Directors was carried out by the entire Board andthat of the Chairman and the Non-Independent Directors were carried out by the IndependentDirectors. The Directors were satisfied with the evaluation results which reflected theoverall engagement of the Board and its Committees with the Company.
NOMINATION & REMUNERATION COMMITTEE POLICY:
The sitting fee paid to the Non-Executive Directors commission to IndependentDirector and remuneration paid to the whole- time director is approved by theremuneration committee. Remuneration Committee consists of Shri Ashok C. Gandhi (DIN:00022507) Shri Shrujal S. Patel (DIN: 02087840) are Independent Directors and Shri AnandN. Jhaveri (DIN: 00489833) is Executive Director.
A half yearly/Quarterly Declaration of financial performance including summaryof significant events in the last six months is currently not being send to each householdof shareholders. However the Company publishes its results in national and state levelnewspapers having wide circulation. The results are also posted on the website of theCompany i.e. www.steelcraft.co.in.
|Sr. No. Name of Director ||Remuneration for F.Y 2015-2016 ||Remuneration for F.Y 2014-2015 |
| ||(Amount In Rs.) ||(Amount In Rs.) |
|1. ANAND V. SHAH (Managing Director) ||900000 ||900000 |
|2. DARSHAN A. JHAVERI (Managing Director) ||900000 ||900000 |
|3. ANAND N. JHAVERI (Whole-time Director) ||900000 ||900000 |
|4. SHASHANK I. SHAH (Whole-time Director) ||900000 ||900000 |
|5. VIRAL A. JHAVERI (Whole-time Director) ||900000 ||900000 |
|6. GIRISH D. SHAH (Whole-time Director Resigned on 22/01/2015) ||NIL ||725806 |
|7. NITA G. SHAH (Whole time Director Appointed on 22/01/2015) ||900000 ||174194 |
*Remuneration is not required to be paid to independent director as per Section 149read with Schedule IV of Companies Act 2013.
M/s Dhiren Shah & Co. Chartered Accountants who have audited the accounts of theyear 2015-16 shall retire at the conclusion of the ensuing General Meeting and areeligible for Re appointment.
Members are requested to consider the re appointment of M/s Dhiren Shah & Co.Chartered Accountants as the Statutory Auditors of the Company from the conclusion ofthis Annual General Meeting at the remuneration to be decided by the Board based on therecommendations of the Audit Committee. A Certificate has been received from M/s DhirenShah & Co. Chartered Accountants to the effect that their appointment if made would bewithin the prescribed limits under Section 141 of the Companies Act 2013.
Company does not fall within the purview of Section 148 of the Companies Act 2013andhence there is no requirement for the Company to appoint Cost Auditor for the F.Y 2015-16.
DIRECTORS RESPONSIBILITY STATEMENT
In accordance with the provisions of Section 134(5) of the Companies Act 2013 yourdirectors confirm that:
a) In the preparation of the annual accounts for the financial year ended 31st March2016 the applicable accounting standards had been followed along with proper explanationrelating to material departures;
b) The directors had selected such accounting policies and applied them consistentlyand made judgments and estimates that are reasonable and prudent so as to give a true andfair view of the state of affairs of the Company as at 31st March 2016 and of the profit/loss of the Company for that period;
c) The directors had taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of the Companies Act 2013 forsafeguarding the assets of the company and for preventing and detecting fraud and otherirregularities;
d) The directors had prepared the annual accounts on a going concern basis;
e) The directors had devised proper systems to ensure compliance with the provisions ofall applicable laws and that such systems were adequate and operating effectively.
f) The directors had laid down internal financial controls to be followed by thecompany and that such internal financial controls are adequate and were operatingeffectively.
MATERIAL EVENTS THAT HAVE HAPPENED AFTER THE BALANCE SHEET DATE
No material changes and commitments affecting the financial position of the Companyhave occurred between the end of the financial year to which the Financial Statementsrelate and the date of the Report.
POLICY ON PREVENTION PROHIBITION AND REDRESSAL OF SEXUAL HARASSMENT OF WOMEN AT WORKPLACE
The Company has zero tolerance for sexual harassment at the Workplace and has adopted aPolicy on Prevention Prohibition and Redressal of Sexual Harassment of Women atWork Place in line with the provisions of the Sexual Harassment of Women atWorkplace (Prevention Prohibition and Redressal) Act 2013 and the Rules made thereunder.
The Policy aims to provide protection to women employees at the workplace and preventand redress complaints of sexual harassment and for matters connected or incidentalthereto with the objective of providing a safe working environment. However no complaintwas registered with regard to the same.
During fiscal 2011 we started a sustainability initiative with the aim of going greenand minimizing our impact on the environment. Like the previous years this year too weare publishing only the statutory disclosures in the print version of the Annual Report.Additional information is available on our website www.steelcraft.co.in.
Electronic copies will be the Annual Report 2015-16 and Notice of the 44thAnnual General Meeting are sent to all members whose email addresses are registered withthe Company / Depository Participant(s). For members who have not registered their emailaddresses physical copies of the Annual Report 2015-16 and the Notice will be the 44thAnnual General Meeting are sent in the permitted mode. Members requiring physical copiescan send a request to the Company.
The Company provides e-voting facility to all its members to enable them to cast theirvotes electronically on all resolutions set forth in the Notice. This is pursuant toSection 108 of the Companies Act 2013 and Rule 20 of the Companies (Management andAdministration) Amendment Rules 2015. The instructions for e-voting are provided in theNotice.
The Directors express their sincere appreciation to the valued shareholders bankersand clients for their support.
| ||For and on behalf of the Board of Directors || |
|Place: Ahmedabad ||Anand V. Shah ||Darshan A. Jhaveri |
|Date: 26th May 2016. ||(DIN: 00017452) ||(DIN: 00489773) |
| ||Managing Director ||Managing Director |