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Asian Fertilizers Ltd.

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Asian Fertilizers Ltd. (ASIANFERTILIZER) - Director Report

Company director report

Dear Members

Your Directors are pleased to present the 31st Annual Report and theCompany’s Audited financial statement for the financial year ended March 31 2016.

1. FINANCIAL HIGHLIGHTS:

The Company’s financial performance for the year ended March 31 2016 issummarized below:

(Rs in Lacs)

PARTICULARS 2015-2016 2014-2015
Revenue from Operation 5449.05 6137.06
Other Income 36.70 38.42
Total Expenditure 5159.92 5786.36
Profit before Interest Depreciation Prior
Period Items and Tax (PBIDT) 325.83 389.12
Less : Finance Costs 243.02 197.24
Less: Depreciation and Amortization 32.34 29.28
Profit Before Exceptional/Prior Period
Items and Tax 50.47 162.59
Less: Exceptional/Prior Period Items (Net) 0 0
Profit Before Taxes (PBT) 50.47 162.59
Less: Tax Expense (Net) 17.77 57.55
Profit for the year (PAT) 32.70 105.04
Add: Balance of Profit brought forward

MANAGEMENT DISCUSSION & ANALYSIS REPORT

a) RESULTS OF OPERATION & STATEMENT OF COMPANY AFFAIRS:

The highlights of the company’s performance for the year ended March 31 2016 areas under

- Revenue from operation decreased by 11.21% to Rs. 5779.05 Lakhs.

- PBDIT decresed by 16.29% to Rs. 325.83 Lakhs.

- Profit before tax decreased by 68.96% to Rs. 50.47 Lakhs.

- Net profit decresed by 68.86% to Rs. 32.70 Lakhs.

b) PLANT OPERATIONS:

The turnover of the company has decreased as compared to the previous year due to poormarket conditions. In quantum vise production of SSP has decreased 4.60% whereasproduction of Sulphuric Acid has increased 1.98% Net Profit has also been decreased duringthe year 2015-16.

Pursuant to the purchase agreement entered into with Shriram Fertilizers &Chemicals (A division of DCM Shriram consolidated Ltd.) on 22.10.02. Your company is ableto achieve production of 44677 MT of SSP during the year 2015-16 against the targetedproduction of 55000 MT which is 81.23% of the production target and 67.69% of theinstalled capacity and dispatched 44543 MT which is 67.49% of the installed capacity ofSSP during the year. The sale of Sulphuric Acid was 16442 MT and 14439 MT of SulphuricAcid has been consumed for production of SSP & Micronutrient. We wish to inform youthat your company has entered a fresh purchase agreement with Shriram Fertilizers &Chemical(A division of Shriram Consolidated Ltd.) from 01.04.2011 in which the totalproduction target is fixed 65000 MT & Shriram Fertilizers & Chemicals has agreedto purchase total production of SSP. Your company has agreed to pay only commission onsales and interest on deployed advances @ 1%-SBI PLR to Shriram Fertilizers &Chemicals to maintain the production schedule.

c) INDUSRIAL RELATIONS:

The company has generally maintained cordial relations with the employees.

d) INDUSTRY STRUCTUREU:

Nitrogen phosphors potassium are three major constituents of fertilizers. India hasgood reserves of phosphate rocks which can be processed to give water soluble phosphaticfertilizers. Single Super Phosphate is a cheap fertilizer and also known as commonfarmer’s fertilizer.

e) DEVELOPMENT IN GOVERNMENT POLICY:

Investment required for setting up a SSP unit is modest compared to Nitrogenousfertilizers. The setup with indigenous technology does not depend in any imported materialbecause of availability of good quality of rock phosphate with Rajasthan State Mines &Minerals Limited a State Govt. Undertaking. The demand of fertilizers is likely toincrease with the emphasis by the Govt. on augmenting agriculture produce. The Govt. ofIndia has also notified that Imported Rock Phosphate from some countries to use inproduction of SSP for competitive Production cost.

f) OPPORTUNITIES:

Since agriculture sector has its own importance in Indian economy it is bound to growand our product SSP has also its own importance in Agriculture sector.

Govt. of India has emphasized to promote SSP to fulfill the demand of phosphaticfertilizers

g) RISK AND CONCERN:

(a) Government Policy:

The Govt. of India has opened the MRP of SSP from 01/04/2011 and manufacturers are freeto decide their rates.

(b) Availability of Raw Material:

Rajasthan State Mines & Mineral Ltd. a State Govt. undertaking is the solesupplier of our basic raw material i.e. Rock Phosphate. After notifying imported Rock Phosphate from some countries by Govt. of India there is no problem in availability of RawMaterial.

(c) Subsidy on SSP:

The Govt. of India has introduced nutrient based subsidy policy for all types offertilizers including SSP. The Govt. of India fixed subsidy for whole year.

(d) Total production of the company (except Sulphuric Acid) is dependent on therain falls and weather conditions.

DIVIDEND:

In order to conserve the resources of the company the Board of directors has decidednot to declare any dividend for the financial year 2015-16.

AMOUNTS TRANSFERRED TO RESERVESU:

During the year under review the board do not propose to transfer any amount to anyreserves.

EXTRACT OF ANNUAL RETURN:

The extract of Annual Return in format MGT-9 for the financial year 2015-2016 hasbeen enclosed with this report as "ANNEXURE -I".

NUMBER OF BOARD MEETING:

Five meetings of the Board of Directors were held during the year as on 29/05/201513/08/2015 14/ 11/2015 20/12/2015 and 13/02/2016.

S.No. Name of Director Designation No. of meeting held No. of meeting attended
1 Gyanendra Nath Gupta Chairman / Indepen- dent Director 5 3
2 Ashok Kumar Matanhelia Managing Director 5 5
3 Somil Matanhelia Whole Time Diretor 5 5
4 Shobhit Matanhelia Whole Time Diretor 5 5
5 Kailash Chandra Madan Independent Director 5 5
6 Anurag Tulsyan Independent Director 5 5
7 Usha Matanhelia Women Director 5 5
8 Pramod Kumar Matanhelia# Non Executive Diretor 3 3

# Mr. Pramod Kumar Matanhelia has resigned from the office of Director w.e.f.20/12/2015 The gap between any of the two Board Meetings did not exceed more than fourmonths. Leave of absence was granted to the non-attending directors on their request andnoted in the attendance register as well as in the minutes of the meetings.

ANNUAL GENERAL MEETING:

The Annual general meeting of the company for the financial year 2014-15 was held on26/09/2015.

RELATED PARTY CONTRACT AND ARRANGEMENT OF THE COMPANY: All the related partytransactions that were entered during the financial year 2015-16 were in the ordinarycourse of business of the Company and were on an arm’s length basis. There were nomaterially significant related party transactions entered by the Company with PromotersDirectors Key Managerial Personnel or other persons which may have a potential conflictwith the interest of the Company.

All such Related Party Transactions are placed before the Audit Committee for approvalwherever applicable. Prior omnibus approval is obtained for the transactions which areforeseen and repetitive in nature. A statement of all related party transactions ispresented before the Audit Committee on a quarterly basis specifying the nature valueand terms and conditions of the transactions.

The policy on dealing with Related Party Transactions has framed by the Board ofDirectors with the prior approval of the Audit Committee.

All related party transactions entered by the Company were in the ordinary course ofbusiness and were on an arm’s length basis form AOC-2 is "ANNEXURE–II" to the Director’s Report.

The details of the transactions with Related Party are provided in the accompanyingfinancial statements.

AUDITORS & AUDITORS’ REPORT:

(a) StatutoryAuditors &Audit Report:

M/s. Kapoor Tandon & Company Chartered Accountants Kanpur the present Auditorsof the Company are retiring at the conclusion of the ensuing Annual General Meeting andhave consented to continue in office if appointed from the conclusion of ensuing AnnualGeneral Meeting till the conclusion of Annual General Meeting of the company for thefinancial year ended on 31st of March 2017. They have submitted the necessaryeligibility certificate in terms of second and third proviso to Section 139(1) of theCompanies Act 2013 read with Rule 4 of the Companies (Audit and Auditors) Rules 2014.

The observations of the auditors are explained wherever necessary in appropriate notesto the accounts. Also there is no adverse comment in the Auditor’s Report.

(b) Secretarial Audit & Secretarial Audit Report:

The Board has appointed M/s Adesh Tandon & Associates Practicing CompanySecretary to conduct Secretarial Audit for the FY 2015-16. The Secretarial Audit Reportfor the financial year ended March 31 2016 is annexed herewith marked as

ANNEXURE III" to this Report. The Secretarial Audit Report containsqualification reservation adverse remark or disclaimer.

The replies of qualification of secretarial Auditor by Board of Directors are givenbelow:

The company is in process to comply with the observations containing in SectearialAudit Report at the earliest however the office being located in the remote area isincapable to hire capable company secretary.

(c) Cost Auditor:

The Board has appointed M/s K. S. Bhatnagar & Associates Cost Accountant NewDelhi as a cost auditor of the Company for conducting the audit of the cost records ofthe company for various segments for the financial year 2015-16:

(a) Mineral or chemical Fertilizers Phosphatic

(b) Inorganic Chemicals and their derivatives

Audit Committe has recomend to appoint M/s K. S. Bhatnagar & Associates CostAccountant New Delhi as a cost auditor of the Company for conducting the audit of thecost records of the company for various segments for the financial year 2016-17 for theapproval of Board of Directors:

(a) Mineral or chemical Fertilizers Phosphatic

(b) Inorganic Chemicals and their derivatives

MATERIAL CHANGES AND COMMITMENTS IF ANY AFFECTING THE FINANCIAL POSITION :

The company would like to inform that no material changes and commitments affecting thefinancial position of the company have occurred during the period from the end offinancial Year till the date of this report.

CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGEEARNINGSAND OUTGO:

a) Conservation of Energy

Since the operations of the company are not energy intensive therefore it does notcall for any steps to be taken.

Therefore clause (i) (ii) & (iii) of Rule 8 are not applicable

b) Technology Absorption

The Company has not imported any specific technology for its operations which are notupdated in India.

c) Foreign Exchange Earnings and Outgo

During the period under review there was no Foreign Exchange Earnings or out flow inthe company

RISK MANAGEMENT POLICY AND IDENTIFICATION OF KEY RISKSU:

The Company would like to inform that the risks which threaten the existence of theCompany have been identified and accordingly a risk management framework has been createdand adopted by the company. Further the internal auditor of the Company has been castedwith the responsibility of monitoring this framework and reports to the management the keyrisks affecting the business.

DETAILS OF DIRECTORS AND KMP ARE APPOINTED AND RESIGNED DURING THE YEAR:

Appointment/ Resignation of Directors:

The Shareholders in 30th Annual General Meeting held on 26thSeptember 2015 has appointed Mr. Shobhit Matanhelia as the executive director of theCompany who was appointed as an additional director of the company by the board ofdirectors w.e.f. 14/02/2015.

Further Mr. P.K. Matanhelia director of the company has resigned from the Companyw.e.f. 20/12/ 2015 during the year 2015-16.

Further Mr. Shobhit Matanhelia was appointed as Whole Time Director of the Companyw.e.f. 01.01.2016 for a period of 3 years.

Key Managerial Personnel:

Ms. Ritika Tandon Company Secretary of the company has resigned from the position ofCompany Secretary from the date of 31st March 2016.

No other director/s or KMP/s have been appointed or retired or resigned during thefinancial year 2015-16.

Retirement by Rotation:

Mr. Ashok Kumar Matanhelia is director liable to retire by rotation and being eligibleoffer himself for re-appointment in the ensuing AGM.

The brief resume of Mr. Ashok Kumar Matanhelia Managing Director of the companyretiring by rotation but seeking re-appointment at the ensuing Annual General Meeting hisexperience in specific functional areas and the companies on which he hold directorshipand / or membership / chairmanship of the committees of the Board his shareholdings areas follows:

(a) Date of Birth 13/01/1956

(b) Date of Appointment 06/01/1986

(c) Qualifications Graduate

(d) Experience in Specific Function Area- Mr. A.K .Matanhelia is an industrialisthaving vast experience in the phosphatic fertilizers industry and is associated with thecompany since the very beginning and is also promoter of the company.

(e) Directorship held in other companies– One.

(f) Committee position held in other companies- Nil.

(g) Share holding position in the company: 110010 shares containing (1.39%)

INTERNAL FINANCIAL CONTROLS:

The existing internal financial control system is adequate and commensurate with thenature and size of the business of the company. The internal auditors of the company keepa follow up on the internal financial reporting and information dissemination of thecompany between the departments. The Audit committee of the company interacts from time totime with the internal auditors of the company regarding the adequacy of internalfinancial control system placed in the company.

DECLARATION BY INDEPENDENT DIRECTOR:

All Independent Directors have given declaration under section 149(7) of the CompaniesAct 2013 that they meet the criteria of independence as laid down under Section 149(6) ofthe Companies Act 2013.

CSR ACTIVITIES:

CSR Activities are not applicable to the company. Since the Company does not meet thecriteria as defined under section 135 of Companies Act 2013 read with schedule.

FORMAL ANNUAL EVALUATION OF BOARD OF DIRECTORS AND ITS COMMITTEES AND INDIVIDUALDIRECTORS:

Performance evaluation of the Board of Directors of the Company

As per the evaluation criteria formulated by the Nomination and Remuneration Committeeof the Board has evaluated its own performance in context of company’s performancestatus of compliance carried out efforts made towards risk management internal controlcode of conduct followed and maintained by them ethical standards met. Below are some ofthe criteria on the basis of which

Board has made its evaluation at specific intervals:

1) Size and composition of the Board of Directors of the company as per Companies Act2013

2) Diversity of thought experience knowledge perspective and gender in the Board ofDirectors of the company.

3) Maintaining transparency in the entire board processes.

4) Any deviations if any from the set goals of the Board and steps taken to controlsuch deviations.

5) Efficiency and effectiveness of the Board of Directors of the Company in carryingout its functions.

6) Timely flow of information among the Board of Directors.

7) Updation of knowledge of governing laws rules and regulations.

8) Independent judgement of each matter placed before the Board of Directors.

After evaluating its own performance Board is of the view that the performance of theBoard of Directors as a whole was satisfactory during the financial year 2015-2016.

Performance evaluation of the Committees of Board of Directors of the Company:

The Board of Directors of the company evaluated the performance of each of itscommittees on the basis of various criteria such as composition of committee quantum andquality of information received by the committee members time spent for discussing thematter and reaching out the final decision efficiency and effectiveness of the decisionmaking of the committee members level of active participation of committee Membersnumber of meetings attended by the members presence of the Chairman of the committee.

On the basis of the above criteria and the working procedure established by the Boardof Directors of the company the Board is of unanimous consent that all the committees ofthe company are working satisfactorily.

Performance evaluation of the Independent Directors of the Company:

As per the criteria formulated by Nomination and Remuneration Committee for theperformance evaluation of Independent directors the performance of each Independentdirector was evaluated by the entire Board of Directors but excluding the director beingevaluated. While evaluation the following things were taken into consideration:

1) Application of Independent judgment while taking decision as part of the Board ofDirectors of the company.

2) Exercise of the responsibility in a bona fide manner in the interest of the company.

3) Attendance in the meeting of Board of Directors and meetings of committees whereindependent director is a member.

4) Active participation in the familiarization programme conducted for the IndependentDirector.

Performance evaluation of the each individual director of the Company:

Further the Board evaluated during the year the performance of each Director takingeach of them as a separate individual in order to judge the contribution and efforts madeby them individually and the initiatives taken by them during the year. This helped theBoard of Directors in deciding whether to extend the tenure of director being evaluated.

COMIITTEES TO THE BOARD:

The Company has several Committees which have been established in Compliance with therequirements of the relevant provisions of applicable laws and statutes.

The Company has following Committees of the Board:

• Audit Committee

• Nomination & Remuneration Committee

• Stakeholders Relationship Committee

The details with respect to the composition of the committees No. and dates of themeeting of the committees and No. of meeting attended by each director of relevantCommittee are given in details below.

(A) AUDIT COMMITTEE:

In compliance and as per the requirements of Section 177of the Companies Act 2013 anAudit Committee has been constituted and re-constituted. The Audit Committee consists ofthree directors out of which two are independents. Four meetings of Audit Committee wereheld during the year on 29.05.2015 13.08.2015 14.11.2015 and 13.02.2016. During theyear all the recommendations made by the Audit Committee were accepted by the BoardComposition and attendance in Committee meeting during the year:

Name of Committee Members Positions Meeting held Meeting attend
Mr. K.C. Madan Chairman/Independent 4 4
Mr.Anurag Tulsyan Member / Independent 4 4
* Mr. P.K. Matanhelia Member / Non-Executive non Independent 3 3
#Mr. Somil Matanhelia Member / Executive non independent 1 1

* Mr. P.K. Matanhelia has resigned from the office with effect from 20/12/2015. # Mr.Somil Matanhelia has inducted a member of the committee w.e.f. 14/11/2015.

The Chairman of the Committee was present at the last Annual General Meeting held on26th September 2015.

Ms. Ritika Tandon is Secretary of the Committee.

The Chief Financial Officer Mr. S.S. Pandey is regular invitees to the said meeting.

The primary objective of the Audit Committee is to monitor and supervise theCompany’s financial reporting process with a view to provide accurate timely andproper disclosures and financial reporting.

(B) ESTABLISHMENT OF VIGIL / WHISTLE BLOWER MECHANISM:-

The Company has established a vigil mechanism for directors and employees in compliancewith the provisions of Sub section 9 of Section 117 read with Rule 7 of Chapter XII of theCompanies (Meetings of Board and its Powers) Rules 2014 to report genuine concerns. Vigilmechanism shall provide for adequate safeguards against victimization of persons who usesuch mechanism and make provision for direct access to the chairperson of the AuditCommittee in appropriate or exceptional case.

The Company promotes ethical behavior in all its business activities and in line withthe best practices for corporate governance. It has established a system through whichdirectors & employees may report breach of code of conduct or suspected fraudunethical business practices illegality fraud and corruption etc at work place withoutfear of reprisal. The Board designated and authorized Mr. Shiv Sahay Pandey CFO of theCompany as Vigilance and Ethics Officer and Mr. K.C. Madan Chairman of the AuditCommittee to oversee the vigil mechanism. The functioning of the Vigil mechanism isreviewed by the Audit Committee from time to time. It may be noted that if any of themembers of the Committee do have a conflict of interest in any given case he/she torecues themselves and the others on the committee would deal with the matter on hand.

The Vigil mechanism shall provide for adequate safeguards against victimization ofemployees and directors who avail of the vigil mechanism and also to provide for directaccess to the Chairman of the Audit Committee and in case of repeated frivolous complaintsbeing filed by a Director or an employee the Chairman of the Audit Committee may takesuitable action against the concerned Director or employee including reprimand.

During the Financial Year 2015-2016 there was no complaint reported by any Director oremployee of the company under this mechanism.

(C) NOMINATION & REMUNERATION COMMITTEE:

In compliance with the provisions of section 178 of the Companies Act 2013 theNomination &Remuneration Committee of the Board has been constituted. The Nomination&Remuneration Committee consists of three Non-Executive Directors. Two meetings of thecommittee were held during the year on 20.12.2015 and 13/02/2016.

Composition and attendance in Committee meeting during the year:

Name of Committee Members Positions Meeting held Meeting attended
Mr. K.C. Madan Chairman / Non Executive Independent Director 2 2
Mr. G. N. Gupta Member / Non-Executive Independent Director 2 2
Mr.Anurag Tulsyan Member / Non-Executive Independent Director 2 2

NOMINATION AND REMUNERATION POLICY OF THE COMPANY:

In compliance with the provisions of Section 178 of the Companies Act 2013 theNomination and Remuneration Committee of the Board of Directors have formulated a policycomprising the criteria for determining qualifications positive attributes andindependence of a director and remuneration for the directors key managerial personneland other employees which have been approved and adopted by the Board. The criteriaformulated by the Nomination and Remuneration Committee is duly followed by the Board ofDirectors of the Company while appointing the directors Key Managerial Personnel andsenior management personnel in the company.

a) Criteria for appointment of Directors in the Company:

1) Person of integrity with high ethical standards.

2) Person with knowledge skill and innovative ideas that can be beneficial to thecompany.

3) Interested in learning new things and updating the knowledge and skills possessed.

4) Person who can act objectively while exercising his duties.

5) Who believes in team spirit

6) Who is responsible towards the work and can devote sufficient time and attention tothe professional obligations for informed and balanced decision making.

In respect of Managing Director Whole-time director and Independent director besidesthe general criteria laid down by Nomination and Remuneration Committee for all directorsthe criteria as mentioned in Companies Act 2013 have also been included.

b) Criteria for appointment of Key Managerial Personal and Senior Management Employee:

1) Person should be having the required educational qualification skills knowledgeand experience as required and necessary for the concerned post.

2) Person should be hardworking self-motivated and highly enthusiastic.

3) Person should be having positive thinking leadership qualities sincerity goodsoft skills and power of taking initiatives.

Remuneration policy of the Company:

The Remuneration policy of the company has been framed by the Nomination andRemuneration Committee in such manner that it can attract and motivate the directors keymanagerial personnel and employees of the company to work in the interest of the companyand to retain them.

1) Company has a policy to pay remuneration in such manner that the relationship ofremuneration to performance is clear and meets appropriate performance benchmarks.

2) It has been ensured while formulating the policy that remuneration to directors keymanagerial personnel and senior management should involve a balance between fixed andincentive pay reflecting short and long term performance objectives appropriate to theworking of the company.

3) Remuneration to be paid to Managing Director/Whole-time Director shall be within thelimits specified under Companies Act 2013.

4) Increments to the existing remuneration may be recommended by the committee to theBoard of Directors.

(D) STAKEHOLDERS RELATIONSHIP COMMITTEE:

In compliance with the provisions of the Companies Act 2013 the StakeholdersRelationship Committee has been constituted by the Board for a speedy disposal ofgrievances / complaints relating to shareholders/investors. The Committee consists ofthree non-executive directors. Four meetings of the Committee were held during the year on29.05.2015 13.08.2015 14.11.2015 and 13.02.2016.

Composition and attendance in Committee meeting during the year:

Name of Committee Members Category Meeting held Meeting attend
Mr. K.C. Madan Chairman/Independent Director 4 4
Mr. A. K. Matanhelia Member/Executive Director 4 4
Mr.Anurag Tulsyan Member/Independent Director 4 4
Mr. Somil Matanhelia Member/Executive Director 4 4

Compliance Officer:

Mr. S. S. Pandey Chief financial officer designated as the Compliance Officer forcomplying with the requirements of the Securities Law and the Listing Agreements with theStock Exchanges in India.

INVESTOR GRIEVANCE REDRESSAL:

The Committee specifically looks into the shareholder redressal and investor complaintson matters relating to refund orders transfer of shares sub-division consolidation ofshare certificates issue of duplicate share certificates non-receipt of annual reportnon-receipt of declared dividends etc. In addition the Committee advises on matters whichcan facilitate better investor services and relations.

Types of Complaint Number of Complaints
No. of share holders’ complaints received so far 0
No. not solved to the satisfaction of shareholder 0
No. of pending complaints 0

POLICY ON INSIDER TRADING:

The company follows a strict code on prohibition of Insider Trading and the same hasbeen detailed to all the directors senior management and employees of the Company.

For ensuring the same the company has formulated & adopted a code of practice& procedure for fair disclosure of Unpublished Price Sensitive Information as per SEBI(Prohibition of Insider Trading) Regulation 2015.

CORPORATE GOVERNANCE:

The Provisions relating to Corporate Governance as enumerated in the clause 49 of theListing Agreement and Regulation 27 of SEBI (Listing obligation & disclosurerequirements) Regulation 2015 are not applicable on the company.

Thus the report on Corporate Governance need not to file with Stock Exchange.

DISCLOSURE RELATED TO EMPLOYEES:

1. The ratio of the remuneration of each director to the median employee(s) remuneration and other details in terms of sub-section 12 of Section 197 of the Companies Act2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014 are open for inspection at the Administrative Office of the companyin terms of the first proviso of Section 136 (1) of the Companies Act 2013 during thebusiness hours. Members who are interested in obtaining such particulars may right to thecompany and same will be furnished on request.

2. The provisions of Section 197 (12) and section 197(14) of the Companies Act2013 read with Rule 5 (2) and (3) of the Companies (Appointment and Remuneration) Rules2014 as amended are not applicable to the company.

LEGAL FRAMEWORK AND REPORTING STRUCTURE:

The Company would like to inform that a legal compliance tool has been installedvertically within the organization for monitoring and complying all laws applicable to theCompany. This tool is being overseen and supervised by the office of the CompanySecretary. Further the Company secretary has also been cast the responsibility ofproviding a compliance certificate at every Board meeting including the keynon-compliances during the quarter.

DIRECTORS’ RESPONSIBILITY STATEMENT:

In accordance with the requirements of Section 134(5) of the Companies Act 2013 it ishereby confirmed that:-

a) in the preparation of the annual accounts the applicable accounting standards hadbeen followed along with proper explanation relating 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 at the end of the financial year and ofthe profit and 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 this Act for safeguarding theassets of the companyand for preventing and detecting fraud and other irregularities;

d) the directors had prepared the annual accounts on a going concern basis;

e) the directors had laid down internal financial controls to be followed by thecompany and that such internal financial controls are adequate and were operatingeffectively; and

f) the directors had devised proper systems to ensure compliance with the provisions ofall applicable laws and that such systems were adequate and operating effectively.

GENERAL

Your Directors state that no disclosure or reporting is required in respect of thefollowing items as there were no transactions on these items during the year under review:

1. Details relating to deposits covered under Chapter V of the Act.

2. Issue of equity shares with differential rights as to dividend voting or otherwise.

3. Issue of shares (including sweat equity shares) to employees of the Company underany scheme.

4. Change in share capital of the company.

5. Change in the nature of the business of the company.

6. Details of subsidiary joint venture or Associates Company.

7. Voluntary Revision of Financial Statements or Board’s Report.

8. Amount transfer to investor education and protection fund.

9. The Company does not have any scheme of provision of money for the purchase of itsown shares by employees or by trustees for the benefit of employees.

10. Particulars of Loans Guarantees & Investments Under Section 186.

11. Neither the Managing Director nor the Whole-time Directors of the Company receiveany remuneration or commission from any of its subsidiaries.

12. No significant or material orders were passed by the Regulators or Courts orTribunals which impact the going concern status and Company’s operations in future.

13. No fraud has been reported by the Auditors to the Audit Committee or the Board.

ACKNOWLEDGMENTS:

The Directors would like to express their sincere appreciation of the cooperation andassistance received from the Authorities Readers Bankers Credit Rating AgenciesDepositories Stock Exchanges Registrar and Share Transfer Agents Associates as well asour Shareholders at large during the year under review.

The Directors also wish to place on record their deep sense of appreciation for thecommitment abilities and hard work of all executives officers and staff who enabledCompany to consistently deliver satisfactory and rewarding performance even in thechallenging economic conditions.

For and on behalf of the Board of Directors
Asian fertilizers limited
Sd./-
Place: New Delhi Ashok Kumar Matanhelia
Date: 30/05/2016 (Managing Director)
DIN: 01763776
Address: 789 Ajay Khand
Patrakarpuram
Rapti Nagar Gorakhpur

FORM NO. AOC -2

(Pursuant to clause (h) of sub-section (3) of section 134 of the Act and Rule 8(2) ofthe Companies (Accounts) Rules 2014

Form for Disclosure of particulars of contracts/arrangements entered into by thecompany with related parties referred to in sub section (1) of section 188 of theCompanies Act 2013 including certain arms length transaction under third proviso thereto.

1. Details of contracts or arrangements or transactions not at Arm’s length basis.

SL. No. Particulars Details
a. Name (s) of the related party & nature of relationship NIL
b. Nature of contracts/arrangements/transaction NIL
c. Duration of the contracts/arrangements/transaction NIL
d. Salient terms of the contracts or arrangements or transaction including the value if any NIL
e. Justification for entering into such contracts or arrangements or transactions’ NIL
f. Date of approval by the Board NIL
g. Amount paid as advances if any NIL
h. Date on which the special resolution was passed in General meeting as required under first proviso to section 188

2 . Details of contracts or arrangements or transactions at Arm’s length basis.

SL. No. Particulars Details
a. Name (s) of the related party & nature of relationship M/S Pashupati Enterprises
b. Nature of contracts/arrangements/transaction Leasing of Property
c. Duration of the contracts/arrangements/transaction Perpetual Deed
d. Salient terms of the contracts or arrangements or 300000/- P.M.
transaction including the value if any
e. Date of approval by the Board 13/02/2016
f. Amount paid as advances if any No

 

For and on behalf of the Board of Directors
Place: New Delhi Asian Fertilizers Limited
Date: 30/05/2016 Sd/-
Ashok Kumar Matanhelia
(Managing Director)
DIN: 01763776
Address: 789 Ajay Khand
Patrakar Puram
Rapti Nagar Gorakhpur