TO THE MEMBERS
The Directors are pleased to present their 70th Annual Report on thebusiness and operations of the Company together with the Audited Accounts for thefinancial year ended March 31 2017.
GENERAL OUTLOOK OF INDUSTRY AND ECONOMY:
The waiting game continues for the capital goods recovery in the domestic market. Whilethere have been signs of recovery in the past few months these are still early days toinfer whether this is a sustainable recovery or just a post-demonetization adjustment. Inany case the margins still elude us to make a meaningful and profitable businessrecovery.
During the year under review we have focused on building our order book and ensuringthat our customer reach is not impacted despite the poor market conditions. We continue toenhance our design capabilities and supply chain efficiencies.
| || ||(Rs. in Lakhs) |
| ||Year Ended March 31 2017 ||Year Ended March 31 2016 |
|Sales and Services (Gross) ||73480.92 ||71381.14 |
|Less: Excise Duty ||7223.02 ||7429.82 |
| ||66257.90 ||63951.32 |
|Other Income ||2785.62 ||2092.70 |
| ||69043.52 ||66044.02 |
|Profit/(Loss) before Interest & Financial Charges Depreciation Exceptional items and Tax ||4596.45 ||3818.86 |
|Less: Interest and Financial Charges ||1594.82 ||2056.05 |
|Less: Depreciation ||987.42 ||1027.44 |
|Profit/(Loss) before Tax ||2014.21 ||735.37 |
|Less: Provision for Taxation ||45.45 ||52.41 |
|Profit/(Loss) for the year ||1968.76 ||682.96 |
|Short/(Excess) provision of Tax for earlier years ||7.99 ||(36.23) |
|Profit/(Loss) after Taxation ||1960.77 ||719.19 |
|Add: Profit/(Loss) Brought Forward ||2217.76 ||1498.57 |
|Less: Depreciation Adjustment || || |
|Net Surplus available for Appropriation ||4178.53 ||2217.76 |
Previous year's figures have been regrouped for comparison purposes with current year'spresentation wherever necessary.
The capital goods industry continues to remain stagnated and investment recovery isstill some way away for the Indian market.
It is in this background that the Company's operations need to be seen.
Income from Sales and Services for the Company increased from ' 71381.14 lakhs in theprevious year to ' 73480.92 lakhs a rise of 3%. The concentrated efforts to reach deeperinto the markets do cherry picking while accepting the orders and the value engineeringhelped the Company to make a profit before exceptional items and tax of ' 2014.21 lakhsas against ' 735.37 lakhs in the previous year.
Tighter working capital management positive cash flow from operations and lowerinterest rates negotiated with the banks enabled the Company to reduce the finance cost by' 461 lakhs compared to the previous year. The Free Reserves of the Company as on March312017 increased by ' 1960.77 lakhs to ' 28649.90 lakhs.
During the year ' 11.22 lakhs was transferred to the Investor Education and ProtectionFund.
HUMAN RESOURCES AND EMPLOYEE RELATIONS:
There is an ongoing emphasis on building a progressive Human Resources culture withinthe Organisation. Structured initiatives to nurture talent and create a workingenvironment that fosters motivation team-work and result orientation continue to beaddressed. Productivity level continued to be subject to continuous monitoring.
Employee strength as on March 31 2017 was 1540 as compared to 1412 in the previousyear.
SUBSIDIARY/JOINT VENTURE/ASSOCIATE COMPANIES:
The Company has no Subsidiary/Joint Venture/ Associate Companies during the Financialyear ending March 31 2017.
The Company has not accepted/renewed any fixed deposits from the public or the Memberswithin the meaning of Section 73 of the Companies Act 2013 read with Chapter V of theCompanies Act 2013 and the Companies (Acceptance of Deposits) Rules 2014 during thefinancial year 2016-2017 and as such no amount of principal or interest on depositsfrom public or the Members was outstanding as of the Balance Sheet date.
MATERIAL CHANGES AND COMMITMENTS IF ANY AFFECTING FINANCIAL POSITION OF THE COMPANYFROM THE END OF THE FINANCIAL YEAR AND TILL THE DATE OF THIS REPORT:
Except as disclosed elsewhere in this Board's Report no material changes andcommitments which could affect the Company's financial position have occurred since theclose of the financial year i.e. March 31 2017 till the date of this Board's Report.Further it is hereby confirmed that there has been no change in the nature of business ofthe Company.
DISCLOSURE OF INTERNAL FINANCIAL CONTROLS:
The Internal Financial Controls with reference to financial statements as designed andimplemented by the Company are adequate and commensurate with the size scale andcomplexity of its operation. The internal controls are tested for adequacy efficiency andeffectiveness through audits by the in-house internal audit department and theobservations corrective and preventive actions are reviewed by the management and AuditCommittee of the Board of Directors.
During the financial year under review no material or serious observation has beenreceived from the Internal Auditors of the Company for inadequacy or ineffectiveness ofsuch controls.
INDIAN ACCOUNTING STANDARDS:
Your Company shall adopt Indian Accounting Standards (Ind AS') with effect fromApril 1 2017 pursuant to Ministry of Corporate Affairs notification dated February 162015 notifying the Companies (Indian Accounting Standards) Rules 2015. Theimplementation of IND AS in 2017 will be a major change process and the Company is wellpositioned to ensure a smooth transition.
SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNAL:
There are no significant and/or material orders passed by the Regulator(s) or Court(s)or Tribunal(s) impacting the going concern status of the Company and its businessoperations in future.
PARTICULARS OF CONTRACT OR ARRANGEMENT WITH RELATED PARTIES:
All contracts/arrangements/transactions entered by the Company during the financialyear 2016-2017 with related parties as defined under Section 188 of the Companies Act2013 and the Rules made there under and as per the applicable provisions of Securities andExchange Board of India (Listing Obligations & Disclosure Requirements) Regulations2015 (hereinafter referred as "the Listing Regulations") were in the ordinarycourse of business and on arm's length basis. Further no material related partytransactions were entered during the Financial Year under review by your Company.Accordingly disclosure of related party transactions as required under Section 134(3) (h)of the Companies Act 2013 read with the Companies (Accounts) Rules 2014 in Form AOC -2is not applicable to your Company.
Further all such contracts/arrangements/transactions were placed before the AuditCommittee and Board for their approval. Prior omnibus approval of the Audit Committee/Board is obtained on an annual basis which is reviewed and updated on quarterly basis.
Your Company has formulated a policy on Related Party Transactions which is alsoavailable on the website of the Company http://www.bharatbijlee.com.
Your Directors draw attention of the Members to Note No. 39 of Financial Statementswhich sets out disclosures on related parties and transactions entered into with themduring the financial year under review.
PARTICULARS OF LOANS GUARANTEE INVESTMENTS AND SECURITIES:
Particulars of loans guarantees investments and securities provided during thefinancial year under review covered under the provisions of Section 186 of the CompaniesAct 2013 have been provided in the Financial Statements which forms part of this AnnualReport. (Please refer Note No. 13 14 and 16 to the Financial Statements).
PARTICULARS OF LOANS/ADVANCES/INVESTMENTS AS REQUIRED UNDER THE LISTING REGULATIONS:
The details of related party disclosures with respect to loans/advances/investments atthe year end and maximum outstanding amount thereof during the year as required underPart A of Schedule V of the Listing Regulations have been provided in the notes to theFinancial Statements of the Company. (Please refer Note No. 13 14 and 16 to the FinancialStatements).
DISCLOSURE UNDER SECTION 43(a)(ii) OF THE COMPANIES ACT 2013:
The Company has not issued any shares with differential rights and hence no informationas per provisions of Section 43(a)(ii) of the Act read with Rule 4(4) of the Companies(Share Capital and Debenture) Rules 2014 has been furnished.
DISCLOSURE UNDER SECTION 54(1)(d) OF THE COMPANIES ACT 2013:
The Company has not issued any sweat equity shares during the financial year underreview and hence no information as per provisions of Section 54(1)(d) of the Act read withRule 8(13) of the Companies (Share Capital and Debenture) Rules 2014 has been furnished.
DISCLOSURE UNDER SECTION 62(1)(b) OF THE COMPANIES ACT 2013:
The Company has not issued any equity shares under Employees Stock Option Scheme duringthe financial year under review and hence no information as per provisions of Section62(1)(b) of the Act read with Rule 12(9) of the Companies (Share Capital and Debenture)Rules 2014 has been furnished.
DISCLOSURE UNDER SECTION 67(3) OF THE COMPANIES ACT 2013:
During the financial year under review there were no instances of non-exercising ofvoting rights in respect of shares purchased directly by employees under a scheme pursuantto Section 67(3) of the Act read with Rule 16(4) of Companies (Share Capital andDebentures) Rules 2014 and hence no information has been furnished.
BOARD OF DIRECTORS & KEY MANAGERIAL PERSONNEL:
In accordance with the provisions of Section 152 of the Companies Act 2013 and theArticles of Association of the Company Mrs. Mahnaz Amir Curmally (DIN 06907271)Non-Executive Director being longest in the office shall retire by rotation at theensuing 70th Annual General Meeting and being eligible offers herself forre-appointment.
The term of office of Mr. Shome N. Danani (DIN 00217787) as Whole-time Directordesignated as "Executive Director" of the Company expired on January 27 2017.The Board of Directors on the recommendation of the Nomination and Remuneration Committeeat their respective meeting held on January 24 2017 have accorded their approval tore-appoint Mr. Shome N. Danani as Whole-time Director designated as "ExecutiveDirector" of the Company for a further period of three (3) years w.e.f. January 282017 subject to the approval of Members of the Company. His re-appointment andremuneration is in terms of Section 196 197 198 200 and 203 read with Section II PartII of Schedule V of the Companies Act 2013 and other applicable provisions of theCompanies Act 2013. The detailed terms and conditions including remuneration have beenmentioned in the Notice convening 70th Annual General Meeting. The details ofMr. Shome N. Danani (DIN 00217787) as required under Listing Regulations and SS-2 areprovided in the Corporate Governance Report and Notice of 70th Annual GeneralMeeting.
During the period under review Mr. Nikhil J. Danani (DIN: 00056514) and Mr. Nakul PIMehta (DIN: 00056561) were re-appointed as Managing Directors for a period of three (3)years w.e.f. June 20 2016 at the 69th Annual General Meeting of Members heldon September 20 2016. Their re-appointment and remuneration is in terms of Section 196197 198 200 and 203 read with Section II Part II of Schedule V of the Companies Act2013 and other applicable provisions of the Companies Act 2013.
Except as explained hereinabove there were no changes in Directorship of the Companyas well as in Key Managerial Personnel category during the period under review. As onMarch 312017 your Company has Nine (9) Directors consisting of four (4) IndependentDirectors Three (3) Executive Directors and Two (2) Non-Executive Directors includingone (1) Woman Director.
None of the Directors of your Company is disqualified under the provisions of Section164(2)(a) and (b) of the Companies Act 2013.
During the period under review no Non-Executive Director of the Company had anypecuniary relationship or transactions with the Company.
Further necessary resolutions relating to Directors who are seekingappointment/re-appointment as required under Regulation 36 of the ListingRegulations/SS-2 is disclosed as part of the Notice dated May 19 2017 of the ensuing 70thAnnual General Meeting.
As for the requirement under the provisions of Section 203 of the Companies Act 2013the Board of Directors noted that Mr. Nikhil J. Danani (DIN: 00056514) Managing DirectorMr. Nakul P. Mehta (DIN: 00056561) Managing Director Mr. Shome N. Danani (DIN:00217787) Executive Director Mr. Durgesh N. Nagarkar Company Secretary and Mr. SandeepM. Tilak Chief Financial Officer are the Key Managerial Personnel of the Company as onthe date of this Board's Report.
DECLARATIONS BY INDEPENDENT DIRECTORS:
Pursuant to the provisions of Section 149(7) of the Companies Act 2013 and Regulation16 (1) (b) of the Listing Regulations the Company has received individual declarationsfrom all the Independent Directors whose names are appended herein below confirming thatthey fulfill the criteria of independence as prescribed under Section 149(6) of theCompanies Act 2013 and the rules made there under to hold the office of IndependentDirector of the Company for the financial year ended March 31 2017.
1. Mr. Prakash V. Mehta;
2. Mr. Sanjiv N. Shah;
3. Mr. Jairaj C. Thacker; and
4. Mr. Rajeshwar R. Bajaaj.
There has been no change in the circumstances which may affect their status asIndependent director during the financial year under review.
NUMBER OF MEETINGS OF THE BOARD:
A notice of the Board Meeting is circulated well in advance with the Agenda includingdetailed explanation to be discussed to enable the Board to take an informed decision.The Board met five (5) times during the financial year ended March 31 2017 viz. on May12 2016 July 18 2016 September 20 2016 October 25 2016 and January 24 2017 inaccordance with the provisions of the Companies Act 2013 and rules made there under andListing Regulations. Detailed information on the Board Meetings with regard to their datesand attendance of each of the Directors thereat have been included in the CorporateGovernance Report which forms part of this Board's Report.
Additionally during the financial year ended March 31 2017 a separate meeting of theIndependent Directors was convened on January 24 2017 in compliance with therequirements of Schedule IV of the Companies Act 2013 and Regulation 25(3) and 25(4) ofthe Listing Regulations. Post the Independent Directors Meeting the collective feedbackof each of the Independent Director was discussed covering performance of the Board as awhole performance of the Non-Independent Directors and performance of the Chairman.
An Audit Committee as constituted by the Board of Directors of the Company inaccordance with the provisions of Section 177 of the Companies Act 2013 comprisesIndependent Directors namely :
1. Mr. Sanjiv N. Shah (Chairman) (DIN: 00007211);
2. Mr. Prakash V. Mehta (Member) (DIN: 00001366); and
3. Mr. Jairaj C. Thacker (Member) (DIN: 00108552).
All the recommendations made by the Audit Committee during the financial year underreview were accepted by the Board. The terms of reference of Audit Committee and otherdetails are included in the Corporate Governance Report.
NOMINATION AND REMUNERATION COMMITTEE:
The Nomination and Remuneration Committee (NRC') as constituted by the Board ofDirectors of the Company in accordance with the provisions of Section 178(3) of theCompanies Act 2013 comprises:
1. Mr. Sanjiv N. Shah (Chairman) (DIN: 00007211);
2. Mr. Prakash V. Mehta (Member) (DIN: 00001366); and
3. Mr. Jairaj C. Thacker (Member) (DIN: 00108552).
Further the NRC has formulated necessary policy on appointment and remunerationincluding criteria for determining qualifications positive attributes independence of aDirector. The details of "Nominations and Remuneration Policy" are explained inthe Report on Corporate Governance along with the other details which forms part of thisBoard's Report and are also available on the website of the Company :http://www.bharatbijlee.com.
STAKEHOLDERS RELATIONSHIP COMMITTEE:
The Stakeholder Relationship Committee (SRC') as constituted by the Board ofDirectors of the Company in accordance with the provisions of Section 178 of theCompanies Act 2013 comprises:
1. Mr. Prakash V. Mehta (Chairman) (DIN: 00001366);
2. Mr. Sanjiv N. Shah (Member) (DIN: 00007211);
3. Mr. Nikhil J. Danani (Member) (DIN: 00056514); and
4. Mr. Nakul P Mehta (Member) (DIN: 00056561).
The detailed terms of reference and other information about the Committee has beenprovided in the Corporate Governance Report.
CORPORATE SOCIAL RESPONSIBILITY COMMITTEE:
The Corporate Social Responsibility (CSR) Committee comprises of
1. Mr. Nakul P Mehta (Chairman) (DIN: 00056514);
2. Mr. Shome N. Danani (Member) (DIN: 00217787); and
3. Mr. Jairaj C. Thacker (Member) (DIN: 00108552).
The CSR Policy of your Company as approved by the Board of Directors' is hosted on theCompany's website www.bharatbijlee.com.
The frequency of CSR Committee meetings is decided by the Chairman and Members of thecommittee with a minimum frequency of once a year. Over the last financial year underreview the CSR Committee has met once i.e. on January 24 2017 wherein all the three(3) Members were present.
The Annual Report on CSR activities as required under Section 134 of the Companies Act2013 read with the Companies (Corporate Social Responsibility) Rules 2014 including abrief outline of the Company's CSR Policy total amount to be spent under CSR Policy forthe financial year 2016-2017 amount unspent and the reason for the unspent amount is setout at Annexure I forming part of this Board's Report.
EVALUATION OF DIRECTORS COMMITTEE AND BOARD:
Pursuant to the provisions of the Companies Act 2013 and the Listing Regulations theBoard of Directors has carried out evaluation of its own performance its Committees andindividual Directors. The evaluation process has been explained in the Report on CorporateGovernance which forms part of this Board's Report.
Also the Independent Directors at their meeting reviewed the performance of theBoard its Chairman and Non-Executive Directors of the Company.
RISK MANAGEMENT POLICY:
The Board of Directors of the Company has approved Risk Management Policy andGuidelines wherein all material risks faced by the Company are identified and assessed.Moreover in the said Risk Management Policy the Board has defined a structured approach tomanage uncertainty cultivating the same in their decision making pertaining to allbusiness divisions and corporate functions. For each of the risks identifiedcorresponding controls are assessed and policies and procedures are put in place formonitoring mitigating and reporting on periodic basis.
VIGIL MECHANISM POLICY:
Pursuant to the provisions of Section 178(9) of the Companies Act 2013 read with Rule7 of the Companies (Meetings of Board and its Powers) Rules 2014 a "Vigil MechanismPolicy" for Directors and employees of the Company is in place to report theirgenuine concern of any violations of legal or regulatory requirements incorrect ormisrepresentation of any financial statements and reports etc. During the financial yearunder review no employee has been denied access to the Chairman of the Audit Committee.Also Whistle blower complaints if any and their redressal are discussed at the meetingof Audit Committee of the Board. During the financial year under review no suchcomplaints were received.
The details of "Vigil Mechanism Policy" are available on the website of theCompany (http://www.bharatbijlee.com)
PREVENTION OF SEXUAL HARASSMENT AT WORKPLACE
Your Company has zero tolerance policy in case of sexual harassment at workplace and iscommitted to provide a healthy environment to each and every employee of the Company. TheCompany has in place Policy for Prevention and Redressal of Sexual Harassment' inline with the requirements of Sexual Harassment of Women at Workplace (PreventionProhibition & Redressal) Act 2013 (hereinafter referred as "the said Act")and Rules made there under. As per the provisions of Section 4 of the said Act the Boardof Directors has constituted the Internal Complaints Committee (ICC') at theRegistered Office Works and at all the Regional Offices of the Company to deal with thecomplaints received by the Company pertaining to gender discrimination and sexualharassment at workplace.
The ICC has been constituted covering the offices at Mumbai/Navi Mumbai consisting ofthe following Members:
|Name of Officer ||Designation ||Position in Committee |
|1. Ms. Aarti Madhankar ||General Manager Human Resources ||Presiding Officer |
|2. Mr. Durgesh N. Nagarkar ||Company Secretary & Senior General Manager: Legal ||Member |
|3. Mr. Nitin R. Rathod ||General Manager Employee Relations ||Member |
|4. Ms. Anjali Ranade ||Senior Manager Design ||Member |
|5. Ms. Renu Rao ||General Manager- Business Solutions (Information Technology) ||Member |
Also each branch of the Company has its own ICC consisting of officers from SerialNo. 1 3 and 4 as mentioned herein above along with two more members employed at thebranches one of them consisting of a woman employed in those respective branches.
As per the provisions of Section 21 & 22 of the said Act the Report on the detailsof the number of cases filed under Sexual Harassment and their disposal for the financialyear under review is as under:
|No. of cases pending as on the beginning of the financial year under review ||No. of complaints filed during the financial year under review ||No. of cases pending as on the end on the financial year under review |
|1. Nil ||Nil ||Nil |
DIRECTORS' RESPONSIBILITY STATEMENT:
In terms of Section 134(3)(c) read with Section 134(5) of the Companies Act 2013 theBoard of Directors hereby confirms that:
a. in the preparation of the annual accounts the applicable accounting standards havebeen followed along with proper explanation relating to material departures;
b. such accounting policies have been selected and applied consistently and theDirectors have made judgments and estimates that are reasonable and prudent so as to givea true and fair view of the state of affairs of the Company as at March 31 2017 and ofthe Profit and Loss of the Company for the year ended on that date;
c. proper and sufficient care has been taken for the maintenance of adequate accountingrecords in accordance with the provisions of this Act for safeguarding the assets of theCompany and for preventing and detecting fraud and other irregularities;
d. the annual accounts of the Company have been prepared on a going concern basis;
e. internal financial controls have been laid down to be followed by the Company andthat such internal financial controls are adequate and were operating effectively;
f. proper systems have been devised to ensure compliance with the provisions of allapplicable laws and that such systems were adequate and operating effectively.
TRANSFER OF UNCLAIMED EQUITY SHARES TO INVESTOR EDUCATION AND PROTECTION FUND (IEPF)SUSPENSE ACCOUNT:
The Ministry of Corporate Affairs (MCA') has vide Notification No. S.O. 2866(E)dated September 5 2016 notified the provisions of Sections 124 and 125 (except for thesub-sections already notified earlier vide notification dated January 13 2016) of theCompanies Act 2013. Further MCA vide Notification dated September 5 2016 brought theInvestor Education and Protection Fund Authority (Accounting Audit Transfer and Refund)Rules 2016 (IEPF Rules') w.e.f. September 7 2016.
Pursuant to the provisions of Section 124 and 125 of the Companies Act 2013 and theInvestor Education and Protection Fund Authority (Accounting Audit Transfer and Refund)Rules 2016 all shares on which dividend has not been paid or claimed for seven (7)consecutive years or more shall be transferred to an Investor Education and ProtectionFund (IEPF') suspense account (in the name of the Company) with one of theDepository Participants as may be identified by the IEPF Authority within thirty (30)days of such shares becoming due to be transferred to the IEPF.
The process of transfer of the shares to the said Suspense Account could not becompleted due to lack of clarity in the said Rules upto April 26 2017. However theCompany has initiated the process and issued individual notices to the 144 shareholdersholding 16878 equity shares who have not claimed their dividends for the last seven (7)consecutive years.
The Statement containing details of Name Address Folio No. Demat Account No. and No.of shares due for transfer to IEPF Suspense Account is made available onwww.bharatbijlee.com.
Both the unclaimed dividends and the shares transferred to the IEPF can be claimed backby the concerned shareholders from IEPF Authority after complying with the procedureprescribed under the "Rules".
As per the latest development the MCA on April 27 2017 via General Circular No.03/2017 came up with clarification on "Transfer of Shares to IEPF Authority"the key highlights of which are:
- The IEPF Authority shall open a special demat account with National SecuritiesDepository Limited (NSDL');
- NSDL to prescribe the file formats and operational procedures for transfer of sharesto special demat account of the IEPF Authority by April 30 2017 and May 31 2017respectively;
- The due date for transfer of such shares by your Company is May 31 2017.
However MCA via General Circular No. 05/2017 dated May 16 2017 notified that theaforementioned Circular No. 03/2017 stands withdrawn with immediate effect and furtherstated that fresh instructions on the matter to be issued in due course of time.
PARTICULARS OF EMPLOYEES AND REMUNERATION:
Information as required under the provisions of Section 197(12) of the Companies Act2013 and Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel)Rules 2014 (including any statutory modification(s)/amendment(s)/re-enactment thereoffor the time being in force) is set out in Annexure II hereto which forms part ofthis Board's Report.
As stipulated under the provisions of Regulation 34(3) read with Schedule V (C) of theListing Regulations a separate Report on Corporate Governance enclosed as Annexure Vforms integral part of this Board's Report. The requisite Compliance Certificate asrequired under Part E of Schedule V of the Listing Regulations issued by Messrs Dalal andShah LLP Chartered Accountants pertaining to the compliance of conditions of CorporateGovernance is annexed thereto.
MANAGEMENT DISCUSSION AND ANALYSIS (MDA) REPORT:
Pursuant to Regulation 34(3) read with Schedule V (B) of the Listing Regulations aseparate report on Management Discussion and Analysis (MDA') forms part of thisAnnual Report.
STATUTORY AUDITOR AND THEIR REPORT:
In terms of Section 139(1) of the Companies Act 2013 no listed Company can appoint orre-appoint an audit firm (including its affiliate firm) as auditor for more than two (2)terms of five (5) consecutive years. The Act also provided for additional transitionperiod of three (3) years from the commencement of the Act i.e. from April 1 2014.
The Members are informed that Messrs Dalal & Shah Chartered Accountants havingRegistration No. 102021W are Statutory Auditors of the Company since 1952. At the 67thAnnual General Meeting of the Company held on September 11 2014 Messrs Dalal & Shahwere appointed as Statutory Auditors for a period of period of 3 (three) years(transitional period) to hold office as such from the conclusion of 67thAnnual General Meeting until the conclusion of the 70th Annual General Meetingof the Company subject to ratification of such appointment by the Members of the Companyat every Annual General Meeting in line with the provisions of Section 139 of the Act.
Accordingly Messrs Dalal & Shah have completed period of ten (10) years and willalso be completing the additional transition period of three (3) years at the conclusionof ensuing 70th Annual General Meeting and the Company therefore need toappoint a new auditor in their place.
Pursuant to and in light of the above the Company has identified Messrs DeloitteHaskins & Sells LLP Chartered Accountants (ICAI Firm Registration Number : 117366W/W-100018) Mumbai as the new Statutory Auditors of the Company and subsequently the Boardof Directors on the recommendation of Audit Committee at their respective Meeting held onMay 19 2017 has appointed Messrs Deloitte Haskins & Sells LLP Chartered Accountantsas Statutory Auditors of the Company for a period of five (5) years from the conclusionof 70th Annual General Meeting till the conclusion of the 75thAnnual General Meeting of the Company subject to the ratification at the Annual GeneralMeeting in each of the subsequent years during the aforementioned term of theirappointment.
Messrs Deloitte Haskins & Sells LLP Chartered Accountants have confirmed thattheir appointment if made shall be in accordance with the limits specified under Section141 (3) (g) of the Act and that they are not disqualified to be appointed as statutoryauditors in terms of the provisions of the proviso to Section 139(1) Section 141(2) andSection 141(3) of the Act and the provisions of the Companies (Audit and Auditors) Rules.
The Audit Committee and the Board of Directors wishes to place on record their deepappreciation for the professional services rendered by Messrs Dalal & Shah duringtheir long association with the Company while maintaining the ethical standards andzenithal level of governance.
OBSERVATIONS OF STATUTORY AUDITORS ON THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH31 2017:
The Auditor's report given by Messrs Dalal & Shah Statutory Auditors on theFinancial Statements of the Company for the year ended March 31 2017 forms part of theAnnual Report. There has been no qualification reservation or adverse remark or anyDisclaimer in their Report.
REPORTING OF FRAUDS:
There have been no frauds reported by the Auditors under sub section (12) of Section143 of the Companies Act 2013 (including amendments) during the financial year underreview to the Audit Committee or the Board of Directors and hence as such there isnothing to report by the Board under Section 134 (3)(ca) of the Companies Act 2013.
SECRETARIAL AUDITORS AND THEIR REPORT:
Pursuant to the provisions of Section 204 of the Companies Act 2013 and the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 your Company hadappointed Messrs N. L. Bhatia & Associates Practicing Company Secretaries Mumbai(Firm Registration No.: P1996MH055800) as its Secretarial Auditor to conduct thesecretarial audit of the Company for the financial year 2016-2017.
The Report on Secretarial Audit for the financial year 2016- 2017 in Form MR-3 as AnnexureVI forms integral part of this Board's Report. There has been no qualificationreservation or adverse remark or any Disclaimer in their Report.
In terms of Section 204 of the Companies Act 2013 on the recommendation of the AuditCommittee the Board of Directors appointed Messrs N. L. Bhatia & AssociatesPracticing Company Secretaries Mumbai (Firm Registration No.: P1996MH 055800) as theSecretarial Auditors of the Company for the financial year 2017- 2018. The Company hasreceived their consent for the said appointment.
COST AUDITORS AND THEIR REPORT:
Pursuant to the provisions of Section 148 of the Companies Act 2013 read with theCompanies (Cost Records and Audit) Amendment Rules 2014 (including any amendment(s)modification(s) variation or re-enactment thereof for the time being in force) and asper the recommendation of the Audit Committee the Board of Directors at their meetingdated May 19 2017 have appointed Messrs P M. Nanabhoy & Co. Cost Accountants (FirmRegistration No.: 000012) as the Cost Auditors of the Company for the financial year2017-2018 to audit the cost records of Electric Motors Power Transformers Drives andElevator System Products. A resolution for ratification of the payment to be made for suchappointment is included in the Notice of the ensuing 70th Annual GeneralMeeting.
A Certificate from Messrs P M. Nanabhoy & Co. has been received to the effect thattheir appointment as Cost Auditors of the Company if made would be in accordance withthe limits specified under Section 141 of the Companies Act 2013 and the Rules framedthere under.
For the financial year ending March 31 2016 the due date of filing the Cost AuditReport submitted by Messrs. P. M. Nanabhoy & Co. Cost Accountants Mumbai wasSeptember 30 2016 and the same was filed with the MCA on August 12 2016.
EXTRACT OF ANNUAL RETURN:
Pursuant to the provisions of Section 134(3)(a) of the Companies Act 2013 the Extractof the Annual Return for the financial year ended March 31 2017 made under the provisionsof Section 92(3) of the Companies Act 2013 read with Rule 12 of the Companies (Managementand Administration) Rules 2014 is attached as Annexure III which forms part ofthis Board's Report.
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO:
The particulars as required under the provisions of Section 134(3) (m) of the CompaniesAct 2013 read with Rule 8 of the Companies (Accounts) Rules 2014 in respect ofconservation of energy technology absorption foreign exchange earnings and outgo etc.are furnished in Annexure IV which forms part of this Board's Report.
Your Company takes pride in all of its highly motivated officers employees andworkers who have been wholeheartedly supporting and sincerely contributing their best forthe sustained success and growth of your Company as well as maintaining harmoniousrelations throughout the Company.
Your Directors also place on record their sincere thanks and appreciation for thecontinuing support and assistance received from the financial institutions banksGovernment as well as non-government authorities customers vendors stock exchange andmembers during the period under review.
For and on behalf of the Board of Directors
Prakash V. Mehta
Place : Mumbai
Date : May 19 2017
Electric Mansion 6th Floor
Appasaheb Marathe Marg
Prabhadevi Mumbai 400 025.