The Members of Balurghat Technologies Limited
The Board of Directors is pleased to present the 23rd Annual Report of the companytogether with the audited financial statement for the year ended on March 31 2017.
The financial performance of the Company for the year ended March 31 2017 aresummarized below:
| || ||(Rs. in hundreds) |
|Particulars ||2016- 2017 ||2015- 2016 |
|Profit before Depreciation & Amortization Expenses Finance Costs & Tax Expenses ||130919 ||115642 |
|Less : Finance Cost ||28247 ||21476 |
|Depreciation ||26547 ||19092 |
|Profit before Tax ||76125 ||75074 |
|Less : Current Tax ||25026 ||13918 |
|Deferred Tax Liabilities ||-3312 ||-1242 |
|Profit for the year ||54411 ||62398 |
|Add: Balance in Profit & Loss Account ||-1068260 ||-1130658 |
|Appropriation || || |
|Add:Adjustment of Provision Of IT ||-691 || |
|Add: Adjustment of fixed Assets || || |
|Closing Balance ||-1014540 ||-1068260 |
SUMMARY OF FINANCIAL RESULTS AND PERFORMANCE OF THE COMPANY
Financial Year 2016-2017 was yet another challenging year. Various constraints and thechallenging environment impacted company performance. The highlights of the performanceare as under:
Revenue from operation increased by 0.142% to 3823980 hundred for the year asagainst 3818545 hundred of the previous year.
PBDIT increased by 13.21% to 130919 hundred for the year as against 115642hundred of the previous year.
Profit before tax increased by 1.399% to76125 hundred for the year as against75074 hundred of the previous year.
Net Profit fell by 12.80% to 54411 hundred for the year as against 62398hundred of the previous year.
In view of the accumulated losses during the current year your Directors are unable torecommend any dividend for the year under reference.
The Company has transferred an amount of Rs.54411 hundreds to the General Reserve whichis current year's profits and the same is in compliance with the applicable provisionsprescribed under the Companies Act 2013.
THE COMPANY'S WORKING DURING THE YEAR/STATE OF COMPANY'S
The Company has performed well irrespective of highly competitive market. Increase inTurnover by 0.142 % in such market conditions showed company's operational excellence.
CHANGE IN THE NATURE OF BUSINESS
There has been no change in the nature of business.
MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY WHICHHAVE OCCURRED BETWEEN THE END OF THE FINANCIAL YEAR OF THE COMPANY TO WHICH THE FINANCIALSTATEMENTS RELATE AND THE DATE OF THE REPORT
There has been no such material or significant changes during the year under review.
DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS ORTRIBUNALS IMPACTING THE GOING CONCERN
STATUS AND COMPANY'S OPERATIONS IN FUTURE
There are no significant and material orders passed by the regulators or courts ortribunals impacting going concern status and company's operations in future.
INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY
The Company has an Internal Control System commensurate with the size scale andnature of its operations. The scope and authority of the Internal Audit function is welldefined and to maintain its objectivity and independence the Internal Audit functionreports to the Chairman of the Audit Committee of the Board as well as directly to theChairman & Managing Director. The Internal Audit Department monitors and evaluates theefficacy and adequacy of internal control system in the Company its compliance withoperating systems accounting procedures and policies of the Company.
Based on the report of internal audit function process owners undertake correctiveaction in their respective areas and thereby strengthen the controls. Significant auditobservations and recommendations along with corrective actions thereon are presented tothe Audit Committee of the Board.
DETAILS OF SUBSIDIARY/JOINT VENTURES/ASSOCIATE COMPANIES
The company do not have subsidiary companies or associates companies nor it has enteredinto any joint ventures agreements.
The company has not accepted any deposits during the year from the Public under section73 to 76 of the Companies Act 2013 nor did it receive the same in any of the previousyears and hence there are no overdue / outstanding Deposits or any interest payablethereon and therefore the prescribed details under the Companies Act 2013 are notrequired to be furnished.
Mr. Kalyan Ranjan Guha of M/s Guha & Sons Chartered Accountant retires as StatutoryAuditor of the Company from the conclusion of the ensuing AGM. The Audit report given bythe Auditor on the Financial Statement of your Company is part of the Annual Report. Therehas been no qualification reservation or adverse remarks given by the Auditor in hisreport.
In accordance with section 139 of the Companies Act2013Listed Companies can notappoint and reappoint an Auditor for more than five consecutive years if an Auditor is anindividual person. Existing Companies which are covered under Auditor Rotationalrequirements should comply with the requirements within three years from the commencementof the Act.Mr Kalyan Ranjan Guha Chartered Accountant(Registration No: 302159E) has beenAuditor of the Company for more than twenty years ( including three years of transitionalperiod).The Board places on record its deep appreciation of valuable contribution made byMr Kalyan Ranjan Guha as statutory auditor of the Company for more than twenty years. Itis now proposed to appoint a new Statutory Auditor in the ensuing AGM .
Pursuant to provisions of section 204 of the Companies Act 2013 and The Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 the company hasappointed Mr. Suresh Chandra Paul Company Secretary in practice to undertake theSecretarial Audit of the Company for FY 2016-17.The Secretarial Audit report is annexedherewith as
The observations made in the Auditor's Report are self explanatory and do not call forany further comments u/s 134(3)(f) of the Companies Act2013. The Auditors have not madeany qualifications in their report.
EXTRACT OF ANNUAL RETURN
The details forming part of the extract of the Annual Return in form MGT-9 is annexedherewith as "Annexure C"
MANAGEMENT'S DISCUSSION AND ANALYSIS REPORT
Management's Discussion and Analysis Report for the year under review as stipulated inSEBI(LODR)Regulations 2015 is presented in a separate section forming part of the AnnualReport.
ENERGY CONSERVATION TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO
Having regard to the nature of business undertaken by your company the disclosures onConservation of Energy and Technology are not required. However there had been foreignexchange outgo of EURO 1314 equivalent to Rs. 99808/- and USD 27767. equivalent to Rs2028976 and Pound Sterling of Great Britain 9886 equivalent to 964304 Australian Dollar17494 eqivalent to 17494/- Thailand Bahat 17116 equivalent to3371325980 Chinese Yenequivalent to71057 during the period under review.
As Per Corporate Governance Report annexed hereto.
CORPORATE SOCIAL RESPONSIBILITY POLICY
As per the criteria prescribed under section 135 of the Companies Act 2013 the CSR isnot applicable to the Company in respect of the financial year 2016-2017 .The company willhowever formulate and implement CSR policy as and when it gets applicable to the Company.
PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS
The company has not given any loans or guarantees covered under the provisions ofsection 186 of the Companies Act 2013. Details of investments made by the company aregiven in the notes to the financial statements.
RELATED PARTY TRANSACTION
The company has framed Policy on materiality of related party transactions and dealingwith related party transactions. All related party transactions that were entered intoduring the financial year were on arm's length basis and were in the ordinary course ofthe business. There are no materially significant related party transactions made by thecompany with Promoters Key Managerial Personnel or other designated persons which mayhave potential conflict with interest of the company at large.
PARTICULARS OF EMPLOYEES
The Statement of Particulars of Employees pursuant to the Provisions of Rule 5 ( 2) ofthe Companies ( Appointment and Remuneration of Managerial Personnel) Rules 2014personnel) Rules 2014 in respect of employees of the Company forms part of this reportand annexed herewith as Annexure "D".
In terms of the provisions of Section Statement of particulars of employees pursuant toRule 5 ( 2)Companies ( Appointment and Remuneration of Managerial Personnel) Rules2014the company did not have any employee who has been in receipt of the remuneration inexcess of prescribed in the above mention section during whole or any part of the yearunder review.
NUMBER OF MEETINGS OF THE BOARD
During the year Four Board Meetings were convened and held details of which areprovided in the Corporate Governance Report. The intervening gap between the Meetings wasin compliance with the Companies Act 2013
DECLARATION BY INDEPENDENT DIRECTORS
All independent directors have given declarations that they meet the criteria ofindependence as laid down under section 149(7) of the Companies Act 2013 and under theextant provisions of the SEBI(Listing Obligation and DisclosureRequirements)Regulations2015.
Pursuant to the provisions of theSec134(3) ( p)Companies Act 2013 and SEBI(ListingObligations and Disclosure Requirements)Regulations2015 the Board has carried out anevaluation of its own performance the directors individually as well as the evaluation ofthe working of its Audit Nomination & Remuneration Committees. During the year underreview the Independent Director met on 13 February 2017 inter alia to discuss theperformance evaluation of Non independent Directors and Board Of Directors as awhole and was satisfied overall .Evaluation Process is based on structured questionnairecovering various aspects of the Board's functioning Board's culture performance wascirculated to the members of the Board for the financial year 16-17.Based on the responsereceived the Board as a whole the Committees the Chairperson and individual Directorswere separately evaluated in the meeting of the Independent Directors and at the meetingof the Board of Directors. The Board has carried out the performance evaluation of allindependent Directors of the Company and is satisfied with their performance..
Sri Pawan Kumar Sethia the retiring director by rotation was reappointed as Directorof the company by the members in the Annual General Meeting held on 28thSeptember 2016.MrPawan Kumar Sethia the Managing Director of the Company was reappointed in the sameAnnual General Meeting held on 28th September 2016 for a period of five years beginningfrom 23rd February 2017 to 22 February 2022.In this connection all the requisite e-formsthat were required to be filed with ROC have been filed and duly approved by theauthority.Mr Hanraj SethiaNon-Independent Non Executive Director of the Companyretires by rotation at the ensuing AGM and being eligible offer himself forre-appointment.
NOMINATION AND REMUNERATION POLICY
The Board has on the recommendation of the Nomination & Remuneration Committeeframed a policy for selection and appointment of Directors Senior Management and theirremuneration including criteria for determining qualifications positive attributes andother matters provided under sub section (3) of section 178 of the Companies Act 2013. TheRemuneration Policy is stated in the Corporate Governance Report.
RISK MANAGEMENT POLICY
As per requirement of section 134 ( 3)(n) of the ompaniesc act 2013 and SEBI( ListingObligations and Disclosure Requirements) Regulations2015 the Board of Directors hasframed risk management policy .The Board has a risk assessment and minimization procedurewhich is reviewed by the Board periodically. There is a structure in place to identify andmitigate various identifiable risks faced by the Company from time to time. At theMeetings of the Board these risks are reviewed and new risks are identified. As of nowthe Directors do not envisage any element of risk which threaten the existence of theCompany.
VIGIL MECHANISM/WHISTLE BLOWER POLICY
The Company believes in the conduct of its affairs in a fair and transparent manner tofoster professionalism honesty integrity and ethical behaviors in all its businessactivities and has put in place a mechanism of reporting illegal or unethical behavior.The Company has adopted a Vigil Mechanism through which the employees Directors and otherstakeholders are free to report to Senior Management any unethical behavior improperpractices and wrongful conduct taking place in the Company for taking appropriate action.The confidentiality of those reporting violations is maintained and they are not subjectedto any discriminatory practice.
During the year under review there were no cases filed pursuant to the SexualHarassment of Women at Workplace ( Prevention Prohibition and Redressal) Act 2013. TheCompany has complied with the requirement of formation of a suitable committee as requiredunder the said act. The Board of Directors and/or the Management of the Company has notreceived any complaint on this account from any of the employees of the Company or fromany other person.
RELATED PARTY TRANSACTIONS
All related party transactions that were entered into during the financial year were onarm's length basis and were in the ordinary course of the business. There are nomaterially significant related party transactions made by the company with Promoters KeyManagerial Personnel or other designated persons which may have potential conflict withinterest of the company at large. The Policy on materiality of related party transactionsand dealing with related party transactions as approved by the Board of Directors .
PREVENTION OF INSIDER TRADING
The Company has adopted a Code of Conduct for Prevention of Insider Trading with a viewto regulate trading in securities by the Directors and certain designated employees of theCompany. The Code requires pre-clearance for dealing in the Company's shares and prohibitsthe purchase or sale of Company shares by the Directors and designated employees while inpossession of unpublished price sensitive information in relation to the Company andduring the period when the trading window is closed. The Board is responsible forimplementation of the Code. All Board Directors and the designated employees haveconfirmed compliance with the Code.
None of the Directors of the Company are disqualified as per provision164(2) of theCompanies Act 2013.Your Directors have made necessary disclosures as required undervarious provisions of the Companies Act 2013 and Listing Regulations.
FRAUDS REPORTED BY AUDITORS
There were no frauds reported by the Auditor under section 143(12) of the Companies Act2013
DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to the requirement under section 134(5) of the Companies Act 2013 withrespect to Directors' Responsibility Statement it is hereby confirmed that:
In terms of Section 134 (5) of the Companies Act 2013 the directors would like tostate that:
i) In the preparation of the annual accounts the applicable accounting standards havebeen followed.
ii) The directors have selected such accounting policies and applied them consistentlyand made judgments and estimates that were 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 or loss of the Company for the year under review .
iii) The directors have taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with the provisions of this Act for safeguardingthe assets of the Company and for preventing and detecting fraud and other irregularities.
iv) The directors have prepared the annual accounts on a going concern basis.
v) The directors had laid down internal financial controls to be followed by thecompany and that such internal financial controls are adequate and were operatingeffectively.
vi) The directors had devised proper systems to ensure compliance with the provisionsof all applicable laws and that such system were adequate and operating effectively.
Your Company complies with all the mandatory requirements as stipulated SEBI DisclosureRegulations2015 . The Report on Corporate Governance as stipulated under SEBI(LODR)Regulations 2015 forms part of the Annual Report. The requisite certificate from theAuditors of the company confirming compliance with the conditions of Corporate Governanceas stipulated under the aforesaid SEBI(LODR)Regulations2015 is attached to this Report.
Your Directors would like to express their appreciation for the assistance andco-operation received from the Banks Government Authorities Customers Vendors andMembers during the year under review. Your Director also wishes to place on record theirdeep sense of appreciation for the committed services by the Executives Staff and Workersof the company.
| ||For and on behalf of the Board of Directors || |
|Dated: 30th May 2017 || || |
|Place: Kolkata || || |
| ||Pawan Kumar Sethia ||Sushil Kumar Sancheti |
| ||Managing Director ||Chairman |
| ||DIN 00482462 ||DIN 03281792 |
M/s. Balurghat Technologies Limited
170/2C A.J.C.Bose Road Kolkata-700014
Our report of even date is to be read along with this letter.
1. Maintenance of Secretarial records is the responsibility of the management of theCompany. Our responsibility is to express an opinion on these secretarial records based onour audit.
2. We have followed the audit practices and processes as were appropriate to obtainreasonable assurance about the correctness of the contents of the Secretarial records. Theverification was done on the test basis to ensure that correct facts are reflected inSecretarial records. We believe that the processes and practices we followed provide areasonable basis for our opinion.
3. We have not verified the correctness and appropriateness of financial records andbooks of accounts of the Company.
4. Where ever required we have obtained the Management representation about complianceof laws rules and regulations and happenings of events etc.
5. The compliance of provisions of Corporate and other applicable laws rulesregulations standards is the responsibility of the management. Our examination waslimited to the verification of procedures on test basis.
6. The Secretarial Audit Report is neither an assurance as to the future viabilityof the Company nor of efficacy or effectiveness with which the management has conductedthe affairs of the Company.
| ||Suresh Chandra Pal |
| ||(Practicing Company Secretary) |
|Place: Kolkata ||ACS No.32198 |
|Date: 30/06/2017 ||C P No. 11952 |
"ANNEXURE D' "
Statement of Particulars of Employees pursuant to the Provisions of Rule 5 (2) of theCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014
1. The ratio of the remuneration of each Director to the median remuneration of theemployee for the financial year 2016-17
|Sl. No ||Name ||Designation ||Ratio of remuneration |
|1 ||Sri Pawan Kumar ||Managing Director ||6.25:1 |
| ||Sethia || || |
|2 ||Sri Arun Kumar ||Whole time Director ||6.00:1 |
| ||Sethia || || |
None of the other directors are paid any remuneration.Sitting fees have been waived byDirectors. As such their names are not included in the above table
2. The percentage increase in remuneration of each Director CFO CS in the financialyear
|Sl. No ||Name ||Designation ||% increase |
|1 ||Sri Pawan Kumar Sethia ||Managing Director ||Nil |
|2 ||Sri Arun Kumar Sethia ||Whole time Director ||20% |
|3 ||Mr. Apurv Sethia ||Chief Financial Officer ||33.33% |
|4 ||Mr Saibal Chowdhury ||Company Secretary ||Nil |
3. The percentageincrease in the median remuneration of employees in thefinancial year.
The median remuneration of the employees in the financial year fall by 1.51%Thecalculation of % fall in Median Remuneration is done based on overall employee cost.
4. The number of permanent employees on the rolls of the Company.
Considering the industry the company operates basically work through contractors.There were 38 employees as on March 31 2017.
5. The explanation on the relationship between average increase in remuneration andCompany performance : fall in average the remuneration is due to resignation of someemployees.
6. Comparison of the remuneration of the Key Managerial Personnel against theperformance of the Company :Due to their performence
7. Variations in the market capitalization of the Company price earnings ratio as atthe closing date of the current financial year and previous financial year and percentageincrease over decrease in the market quotations of the shares of the Company in comparisonto the rate at which the Company came out with the last public offer in case of listedCompanies and in case of unlisted
Companies the variations in the net worth of the Company as at the close of thecurrent financial year and previous financial year .
The net worth of the Company rise from Rs.672558 hundreds to Rs.726278 hundredsregistering an increase of Rs53720 hundreds. The net worth thereby depicted an increase of7.98%. This is the effect of transfer of net profits to the reserves during the year.
8. Average percentile increase already made in the salaries of employees other than theManagerial personnel in the Last financial year and its comparison with the percentileincrease in the managerial remuneration and justification thereof and point out if thereare any exceptional circumstances for increase in the managerial remuneration
The increase in the managerial remuneration is due to their performance.
9. Comparison of each remuneration of the Key Managerial Personnel against theperformance of the Company
The total revenues of the Company increase by 0.142%. The net profit of the Companyfell from Rs.62398 lakhs to Rs.54411 lakhs leading to fall of 12.80 %. The remunerationpaid to the Key Managerial Personnel and the increase therein during the year is nil.. Thetable below depicts the details of the employee remuneration as against the performance ofthe Company
|Sl. No ||Name ||Designation ||% to the net profits |
|1 ||Sri Pawan Kumar Sethia ||Managing Director ||28% |
|2 ||Sri Arun Kumar Sethia ||Wholetime Director ||26.47% |
|3 ||Sri .ApurvSethia ||Chief Financial Officer ||17..64% |
|4 ||Mr Saibal Chowdhury ||Company Secretary ||3.75% |
10. The key parameters for any variable component of remuneration availed by theDirectors
There is No variable component paid to any of the Directors of the Company.
11. The ratio of the remuneration of the highest paid director to that of the employeeswho are not directors but receive remuneration in excess of the highest paid Directorduring the year.
12. Affirmation that the remuneration is as per the remuneration policy of the Company
The remuneration paid is in accordance with the remuneration policy of the Company.