Your Directors are pleased to present the 37th Annual Reportstogether with the Audited Accounts of the Company for the year ended on 31stMarch 2017.
| ||2016-2017 ||2015-2016 |
| ||(Rs. in lacs) ||(Rs. in lacs) |
|Revenue from Operations ||2732.46 ||2474.28 |
|Net Profit Before Taxation ||281.06 ||625.82 |
|Net Profit after taxation ||166.89 ||431.54 |
|Balance of Profit & Loss Account B/F ||1166.99 ||950.98 |
|APPROPRIATIONS: || || |
|Transfer to General Reserve ||15.00 ||15.00 |
|Dividend Payable (@ 1.0 per Share) Previous Year @Rs. 2.5 per share. ||66.36 ||165.91 |
|Tax on Dividend ||13.51 ||33.98 |
|Taxes of earlier Years ||22.82 ||0.64 |
|Balance of Profit & Loss Account C/F ||1216.19 ||1166.99 |
DIRECTORS RESPONSIBILITY STATEMENT:
Pursuant to provisions of Section 134(5) of the Companies Act 2013 the Directorshereby state and confirm -
(a) in the preparation of the annual accounts the applicable accountingstandards had been followed along with proper explanation relating to material departures;
(b) the directors had selected such accounting policies and applied themconsistently and made judgments and estimates that are reasonable and prudent so as togive a true and fair view of the state of affairs of the company at the end of thefinancial year and of the profit and loss of the company for that period;
(c) the directors had 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;
(d) the directors had prepared the annual accounts on a going concern basis; and
(e) the directors had laid down internal financial controls to be followed bythe company and that such internal financial controls are adequate and were operatingeffectively.
(f) the directors had devised proper systems to ensure compliance with theprovisions of all applicable laws and that such systems were adequate and operatingeffectively.
Based on the framework of internal financial controls and compliance systemsestablished and maintained by the Company work performed by the internal statutory andsecretarial auditors and external consultants including audit of internal financialcontrols over financial reporting by the statutory auditors and the reviews performed bymanagement and the relevant board committees including the audit committee the board isof the opinion that the Companys internal financial controls were adequate andeffective during FY 2016-17.
During the year turnover of your Company slightly increased in the comparison ofprevious year.
Based on the Companys performance during the year 2016-17 the Board of Directorsdecided to recommend dividend of Rs.1/- (i.e. 10%) per share amounting to Rs. 7987201(inclusive of tax of Rs. 1350979). The dividend payout is subject to approval of membersat the ensuing Annual General Meeting.
TRANSFER TO RESERVES:
The Board of the directors has proposed to transfer Rs. 15.00 Lakhs to the GeneralReserve out of the amount available for appropriations and an amount of Rs 49.20 lakhs isproposed to be retained in the Profit and Loss Account after provision of proposeddividend and taxes there on and taxes of earlier year.
SETTLEMENT OF MANAGEMENT DISPUTES:
As already reported that the Special Leave Petition vide no. 25165-25166/2007 filed byShri Ajit Kumar Gupta and others against Honble CLB order in the matter of C.P. No.14/99 is still pending before Honble Supreme Court for appropriate order. Howeverone of the Respondent Mr. Prashant Gupta had filed an application before HonbleSupreme Court against Respondent No.1 (Company) Respondent No. 2 (Mr. Ashok Kumar Gupta)to transfer of 472540 shares in his favour by deleting joint holders name of whichMr. Ashok Kumar Gupta is joint holder and release payment of all due dividend for F.Y.2014-15 and 2015-16 to him. The matter was heard by Honble Court on 08.05.2017 andHonble Court directed to make payment of accrued dividend to Mr. Prashant Gupta andCourt also stated to take this SLP on number for hearing. As matter of facts the companyhad paid said dividend to Mr. Prashant Gupta by demand draft during the F.Y. 2014-15 and2016-17 but due to mismatch/closing of bank account by Mr. Prashant Gupta the same werenot encased. The Company is in process to comply order of Honble Supreme Court.
However in view of Honble Supreme Court order Mr. Raj Kumar Gupta illegallystating himself as Executive Director and CEO of the Company using letter head of Companyand sending fake and baseless letters to the Company. The Board has rejected all suchillegal and baseless letters of Mr. Raj Kumar Gupta.
MANAGEMENTS DISCUSSION AND ANALYSIS REPORT:
Managements Discussion and Analysis Report for the year under review asstipulated under Regulation 34 of the Securities and Exchange Board of India (ListingObligations and Disclosure Requirements) Regulations 2015 (SEBI LODR) is presented in aseparate section forming part of the Annual Report.
DIRECTORS AND KEY MANAGERIAL PERSONNEL:
Pursuant to the provisions of section 149 of the Act Mr. Ashok Kumar Kapoor Mr.Praveen Anand Singh and Mr. Tanmay Deva were appointed as independent directors at theannual general meeting of the Company held on August 13 2015. They have submitted adeclaration that each of them meets the criteria of independence as provided in section149(6) of the Act and there has been no change in the circumstances which may affect theirstatus as independent director during the year.
Smt. Shalini Chandra retires by rotation and being eligible has offered herself forre-appointment. If re-appointed she will continue as Executive Director of the companytill 28th February 2020.
During the year the non-executive directors of the Company had no pecuniaryrelationship or transactions with the Company other than the sitting fees commission andreimbursement of expenses incurred by them for the purpose of attending meetings of theCompany.
Pursuant to the provisions of section 203 of the Act the key managerial personnel ofthe Company are Mr. Ashok Kumar Gupta Chairman & Managing Director Mr. SiddharthGupta Chief Executive Officer and Managing Director Smt. Shalini Chandra ExecutiveDirector Mr. Jai Singh Chief Financial Officer and Mr. R.K. Singh Company Secretary.There has been no change in the key managerial personnel during the year.
The board of directors has carried out an annual evaluation of its own performanceboard committees and individual directors pursuant to the provisions of the Act and thecorporate governance requirements as prescribed by Securities and Exchange Board of India(Listing Obligations and Disclosure Requirements) Regulations 2015 ("SEBI ListingRegulations").
The performance of the committees was evaluated by the board after seeking inputs fromthe committee members on the basis of the criteria such as the composition of committeeseffectiveness of committee meetings etc.
The board and the nomination and remuneration committee reviewed the performance of theindividual directors on the basis of the criteria such as the contribution of theindividual director to the board and committee meetings like preparedness on the issues tobe discussed meaningful and constructive contribution and inputs in meetings etc. Inaddition the chairman was also evaluated on the key aspects of his role.
In a separate meeting of independent directors performance of non-independentdirectors performance of the board as a whole and performance of the chairman wasevaluated taking into account the views of executive directors and non-executivedirectors. The same was discussed in the board meeting that followed the meeting of theindependent directors at which the performance of the board its committees andindividual directors was also discussed. Performance evaluation of independent directorswas done by the entire board excluding the independent director being evaluated.
POLICY ON DIRECTORS APPOINTMENT AND REMUNERATION AND OTHER DETAILS
The Companys policy on directors appointment and remuneration and othermatters provided in section 178(3) of the Act has been disclosed in the corporategovernance report which forms part of this report.
INTERNAL FINANCIAL CONTROL SYSTEMS AND THEIR ADEQUACY
The details in respect of internal financial control and their adequacy are included inthe management discussion & analysis which forms part of this report.
The details pertaining to composition of audit committee are included in the CorporateGovernance Report which forms part of this report.
APPOINTMENT OF AUDITORS AND AUDITOR REPORT:
M/s Kamal Kishore & Company Chartered Accountants the statutory auditors of theCompany hold office till the conclusion of the 37th Annual General Meeting ofthe Company. The Board has recommended the appointment of M/s G D Dubey & AssociatesChartered Accountants as the statutory auditors of the Company in their place for a termof five consecutive years from the conclusion of the 37th Annual GeneralMeeting of the Company scheduled to be held in the year 2017 till the conclusion of the 42ndAnnual General Meeting to be held in the year 2022 subject to ratification every year inAnnual General Meeting for approval of shareholders of the Company based on therecommendation of the Audit Committee.
The Notes on financial statement referred to in the Auditors Report areself-explanatory and do not call for any further comments. The Auditors Report doesnot contain any disqualification reservation or adverse remark.
The Board has appointed Mr. P. N. Gupta Practicing Company Secretary to conductSecretarial Audit for the financial year 2016-17. The Secretarial Audit Report for thefinancial year ended 31st March 2017 is annexed herewith marked as Annexure I tothis report. The Secretarial Audit Report does not contain any qualification reservationor adverse remark.
The board of directors of the Company has formed a risk management committee to frameimplement and monitor the risk management plan for the Company. The committee isresponsible for reviewing the risk management plan and ensuring its effectiveness. Theaudit committee has additional oversight in the area of financial risks and controls.Major risks identified by the businesses and functions are systematically addressedthrough mitigating actions on a continuing basis. The development and implementation ofrisk management policy has been covered in the management discussion and analysis whichforms part of this report.
EXTRACT OF ANNUAL RETURN
The extract of Annual Returns [Pursuant to section 92(3) of the Companies Act2013 and rule 12(1) of the Companies (Management and Administration) Rules 2014] ason the financial year ended on 31.03.2017 is attached as Annexure- II with thisReport.
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNING AND OUTGO:
Information as per Section 134 (3) (m) of the Companies Act 2013 read with Companies(Accounts) Rules 2014 are furnished as under:
a) Conservation of Energy :
The operations of the Company involve low energy consumption. The solar power plant of150 KVA is properly working and saving grid electricity. Other adequate measures are beingtaken to conserve the energy.
b) Technological Absorption:
The Company has imported machines from China and Czech Republic to upgrades itstechnological inputs for its products. However presently company has no collaborationarrangement with any foreign organization.
c) Foreign Exchange Earning and Outgo:
The actual foreign exchange earnings (inflow) of the Company during the financial yearhas been Rs 1974.95 lakhs from Exports of Glass Beads Hand knotted Carpets Handicraftsand other items. The actual foreign Exchange Outflow during the year has been Rs. 169.79lakhs for the import of materials foreign traveling expenses and other sales promotionalactivities.
Corporate Governance Report Management Discussion and Analysis statement and BusinessResponsibility Report and a certificate from the Auditors confirming compliance areannexed herewith to this report.
MATERIAL CHANGES AND COMMITMENT IF ANY AFFECTING THE FINANCIAL POSITION OF THE COMPANYOCCURRED BETWEEN THE END OF THE FINANCIAL YEAR TO WHICH THIS FINANCIAL STATEMENTS RELATEAND THE DATE OF THE REPORT
No material changes and commitments affecting the financial position of the Companyoccurred between the end of the financial year to which this financial statements relateon the date of this report.
SUBSIDIARIES JOINT VENTURES AND ASSOCIATE COMPANIES
The Company does not have any Subsidiary Joint venture or Associate Company.
NUMBER OF MEETING OF BOARD
Four Board Meetings were held during the F.Y. on 26th May 2016 28thJuly 2016 27th October 2016 24th January 2017.
STATEMENT OF DECLARATION GIVEN BY INDEPENDENT DIRECTORS U/S 149 (6).
All the Independent Directors have given their declaration as per Section 149(7) thatthey meet the criteria of independence as provided in section 149(6) of the Companies Act2013.
POLICY ON DIRECTORS APPOINTMENT AND REMUNERATION-
The current policy is to have an appropriate mix of executive and independent directorsto maintain the independence of the Board and separate its functions of governance andmanagement. As on 31.03.2017 the board consists of 6 members three of whom are executiveor whole-time directors including one woman and three are independent directors.
The policy of the company on directors appointment and remuneration including criteriafor determining qualifications positive attributes independence of a director and othermatters provided under Sub-section (3) of section 178 of the Companies Act 2013. Weaffirm that the remuneration paid to the directors is as per the terms laid out in thenomination and remuneration policy of the Company.
FIXED DEPOSITS FROM PUBLIC:
The Company have not accepted any fixed deposits and as such no amount of principalinterest was outstanding as of the balance sheet date.
PARTICULARS OF EMPLOYEES AS PER RULE 5(2) OF CHAPTER XIII THE COMPANIES (APPOINTMENTAND REMUNERATION OF MANAGERIAL PERSONNEL) RULES 2014
The company did not have any employee covered by the provisions of Rule 5(2) of ChapterXIII the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014.
The Company has taken limit from Yes Bank of Rs. 1500.00 lakhs and the amount of loanoutstanding as on 31.3.2017 was Rs.109.61 lakhs.
DETAILS OF LOANS GIVEN INVESTMENTS MADE AND GUARANTEE GIVEN COVERED U/S 186 (4) OF THECOMPANIES ACT 2013.
Loans given and Investments made are given under the respective heads of the BalanceSheet.
No Corporate Guarantees given by the Company in respect of loans as at 31st March2017.
As per SEBI Listing Regulations the Corporate Governance Report with theAuditors Certificate thereon and the Management Discussion and Analysis areattached which form part of this report.
As per Regulation 34 of the SEBI Listing Regulations a Business Responsibility Reportis attached and is a part of this annual report.
As per Regulation 43A of the SEBI Listing Regulations the Dividend Distribution Policyis disclosed in the Corporate Governance Report and on the website of the Company.
TRANSACTIONS WITH RELATED PARTIES.
None of the transactions with related parties falls under the scope of section 188(1)of the Act. Information on transactions with related parties pursuant to section 134(3)(h) of the Act read with rule 8(2) of the Companies (Accounts) Rules 2014 are given in AnnexureIII in Form AOC-2 and the same forms part of this report.
Particulars of contract U/s 188
Transactions i.e. the Companys transactions that are of material nature withits Promoters Directors and the management their relatives or subsidiaries among othersthat may have potential conflict with the Companys interests at large.
During the period under review the Company had not entered into any materialtransaction with any of its related parties that may have potential conflict withthe Companys interests at large. None of the transactions with any of relatedparties were in conflict with the Companys interest. Attention of members is drawnto the disclosure of transactions with related parties set out in Note No. 27 of FinancialStatements forming part of the Annual Report.
All related party transactions are negotiated on an arms length basis and areintended to further the Companys interests.
CORPORATE SOCIAL RESPONSIBILITY.
The Provision of Section 135 of Companies Act 2013 concerning with Corporate SocialResponsibility is applicable during the F.Y. 2016-17. The Company has constitutedCorporate Social Responsibility Committee of following members to make CSR policy andadvising expenditure for CSR.
|1. ||Shri Ashok Kumar Kapoor ||- Chairman (Independent Director) |
|2. ||Shri Ashok Kumar Gupta ||- Member |
|3. ||Smt. Shalini Chandra ||- Member |
|4. ||Shri Tanmay Deva ||- Member (Independent Director) |
|5. ||Shri Praveen Anand Singh ||- Member (Independent Director) |
EVALUATION REPORT ON CAPITAL
The Provision of Evaluation on Capital is not applicable to the Company. Besides thatthe Board met time to time and appraised performance of the Company. The ways and meanswere made to increase the business and growth of the Company.
INCREASE IN PAID-UP CAPITAL-
During the year one shareholders calls in arrears amount Rs.500 have been realised.After giving effect of said receipt the paid-up capital changed/ increased to Rs.66138220 from Rs. 66137720. The balance calls in arrears are @ Rs. 5 per share on 44800shares amounting Rs. 224000/-
MATERIAL CHANGES :
No material changes were made during the year which affects the financial andcommitments of the Company.
INTERNAL FINANCIAL CONTROLS:
The Company has in place adequate internal financial controls with reference tofinancial statements. During the year such controls were tested and no reportablematerial weakness in the design or operation were observed.
The company had been recognized/rated as "ICRA SME 3" by ICRA Ltd.will be expired on 10.08.2017 and the same is under renewal process.
TRADING OF SHARES UNDER "B" GROUP:
The shares of your Company are presently being traded with BSE and NSE Stock Exchangesunder "B" Group.
The Directors wish to place on record their sincere appreciation of the devoted andefficient services rendered by all officers employees and others associated with theCompany.
| ||By order of the Board of Directors |
| ||For BANARAS BEADS LTD. |
| ||Sd/- |
|Place : VARANASI ||(Ashok Kumar Gupta) |
|Date : 25 05. 2017 ||Chairman & Managing Director |