To the Members of Cals Refineries Limited
The Directors present their Thirty Second Annual Report and Audited FinancialStatements for the financial year 2015-16.
1. Financial Summary/highlights on Performance of the Company (Standalone)
(Rs. in million)
|Description ||Year Ended March 31 2016 ||Year Ended March 31 2015 |
|Revenue from Operations ||- ||- |
|Other Income ||3.02 ||0.16 |
|Total Revenue ||3.02 ||0.16 |
|Operational Expenses ||- ||- |
|Employee Benefit Expenses ||3.63 ||6.47 |
|Interest and Finance Charges ||0.00 ||0.00 |
|Depreciation and Amortizations ||0.21 ||0.38 |
|Other Expenses ||11.82 ||8.29 |
|Total Expenses ||15.66 ||15.14 |
|Profit/(Loss) before exceptional items ||(12.64) ||(14.98) |
|Exceptional Items ||- ||5587.67 |
|Profit/(Loss) for the year ||(12.64) ||(5602.65) |
As there is no operating income and consequently no profit is available fordistribution as dividend.
The Company is not having any income and therefore there is no surplus available to becarried forward to Reserves.
4. Brief description of the Company's working during the year/ State of Company'saffair
Company's operation during the year
It has been evident since long that the business operations of the Company have come toa standstill and Directors have been regularly reporting the reasons for the same.
It is reiterated that the SEBI vide its final order dated 23rd October 2013 issuedagainst the Company after the prolonged investigation of approx. two years restrictedthe Company from entering into the securities market and altering its capital structurein any manner effectively for period of eight years from the date of the order. TheCompany has already gone through approx. half of the prohibition period as imposed by theSEBi. Your Company however has challenged the aforesaid order of SEBI at SecuritiesAppellate Tribunal in December 2013. Approx. three years have elapsed since then and thematter is still ongoing before the Tribunal. The prohibition period of approx. five yearshas almost abolished any chances of survival of the Company and its project.
The shareholders would appreciate that despite adverse circumstances your Company hasalways complied with various statutory requirements under different laws rules andregulations dealings with the litigations and other day to day administrative activities.Your Company has paid all the statutory dues to various statutory authorities withoutfail despite no revenue generation at all in past years. Your Company being listed entityhaving a wide shareholder base of approx. 1.80 lakh incurs huge costs of compliances andapart from it also meets a considerable amount of litigation and legal expenses. Since inthe previous 7 to 8 years the Company has not booked any income or generated any revenueat all arranging such huge amount of funds has been a cause of concern.
Presently the single source of the funding to the Company is through one of the relatedparty and promoter Company M/s Nyra Holdings Private Limited. The Inter Corporate Loanbeing taken by your Company from Nyra Holdings to manage its day to day operationcompliances and litigation expenses cannot be Interest free as per the prevailingprovisions of the Companies Act 2013. Company has raised this issue before the regulatorsviz. Securities and Exchange Board with a copy to the Registrar of Companies andexplained them about the constrained situation of the Company with prayers that anexemption be granted to the Company from making its compliances till the SEBI prohibitionis lifted and to allow M/s Nyra Holdings Private Limited to give interest free loans tothe company without considering the same to be a default of the provisions of theCompanies Act 2013 and also to modify the SEBI order dated 23rd October 2013 and permitthe current promoters (M/s Nyra Holdings Private Limited in specific) to induct capital /funds against issue of equity. The Company has received no reply till date even aftersending several reminders.
Further to reiterate the Company's operation has come to a standstill and nodevelopment could be made towards implementation of the project of the Company. Thecontracts and the agreements which were entered by the Company w.r.t the implementation ofthe refinery project have also lapsed or expired long back. Capital advances which weremade at the implementation stage of the project are either not recoverable or specificperformance against the said advances cannot be enforced. The Board of Directors afteranalyzing the aforesaid situation and also based on the opinion received from legal firmshad decided to write off various advances land and pre-operative expenses etc. from thebalance sheet of the Company in the year 201415 to give true and fair picture of thefinancial statement. The Board further considered that carrying such advances which haveno material value or relevance to the books of accounts would be inappropriate and wouldnot give a true and fair view to the investors/shareholders of the Company.
However such writing off of aforesaid advances land and pre-operative expense hadresulted in substantial change in the profit/loss of the Company and had a huge impact onthe Net worth of the Company which is now completely eroded. The Auditors have pointedthis out in their Report of the previous year and in this year too and have qualifiedtheir opinion regarding the Going Concern issue and the Board has given their comment onthe said qualification of Auditor's in the later part of this Report.
Investigation of Serious Fraud Investigation Office (SFIO)
As reported in the previous year that the Serious Fraud Investigation Office (SFIO) hadinitiated an investigation into the affairs of the Company under section 212 of theCompanies Act 2013 the investigation is relating to the issuance of GDRs by the Companyin the year 2007 and the proposed GDR issue in the year 2011.
Your Company has provided all the requisite information and necessary support to theinvestigation team and have also provided all the documents as enquired by them from timeto time. The Investigation is still ongoing and have not yet reached to the conclusion.
Notices u/s 148 of the Income Tax for the A.Y. 2008-09 and 2009-10 for the IncomeEscaping Assessment U/s 147 of the Income Tax Act 1961
Your Company had received Notices u/s 148 of the Income Tax for the A.Y. 2008-09 and2009-10 for the Income Escaping Assessment U/s 147 of the Income Tax Act 1961.
The Notice was in respect of assessment/re-assessment recomputing of theLoss/Depreciation of the Company for the said Assessment Years. As per the requirement ofthe Section 147 and Section 148 of the Income Tax 1961 the authority has also providedthe reasons for re-opening the case for both of the Assessment years.
The Company had challenged the aforesaid reasons for re-opening of the case and foughtthis matter on all the possible ground available to the Company including filing of writpetition in the Hon'ble High Court of Delhi which was later on upon instructionswithdrawn with liberty to urge all points of the petition at appropriate forum inaccordance with law.
Later in due course of assessment for the A.Y. 2009-10 the A.O had passed an orderdated 28/03/2016 stating that the advances in subject matter given by the Company is notmade for the business purpose of the Company and therefore the Capital Work In Progressmust be reduced by Rs. 464.97 crores. A.O. has also observed that the expense has not beenbooked in P&L A/c therefore no addition is being made to income of the assesse onthis ground. This Order has been challenged by the Company at the appropriate forum underSection 246A(1)(b) of the Income Tax Act 1961.
However the assessment proceedings of A.Y. 2008-09 has been referred by the A.O. tothe Transfer Pricing officer and it is yet to attain the finality.
Status of project
As your Directors have been reporting since long that the Company's Crude OilRefinery which was proposed in 2007 at Haldia (West Bengal) with a capacity of 5 MMTPAhas become unviable due to non-availability of funds restrictive order of SEBI pendinglitigations and unrecoverable advances paid to suppliers on account of non-fulfilment offinancial obligations by company in time. As considerable time has lapsed the prospect ofthe project revival has also been bleaked. A detailed discussion in this respect was alsopresented in the previous year's report including a discusion on the allotment of landadmeasuring about 400 acres at Haldia by Haldia Development Agency (HDA) West BengalEnvironmental clearances Civil construction etc. Considering that the situation has notbeen changed much no such discussion is again included in this report.
As reported above that the Company has filed an appeal against the final order of theSEBI dated 23rd October 2013 in Securities Appellate Tribunal which has not yet attainedthe finality. The Company's future is entirely dependent on the outcome of the SATproceedings. I n the current adverse circumstances any discussion on the projectimplementation is a futile and meaningless exercise as with passage of time your Companyhas survived almost half of the restrictive order of SEBI and the chances of the revivalof the project are bleak.
The previous contracts agreements which were entered into w.r.t the implementation ofrefineries have expired long back and now not in force. At this moment the Company has nooperational project and no operational revenues accrue to the Company. Hence the future ofthe Company is completely dependent on positive or favourable orders of the SAT.
5. Change in the nature of business if any
There was no change in the nature of business of the Company during the financial year2015-16.
6. Material changes and commitments if any affecting the financial position of thecompany which have occurred between the end of the financial year of the company to whichthe financial statements relate and the date of the report
There are no changes and commitments which are affecting the financial position of theCompany from the end of the financial year i.e. 31st March 2016 till the date of thisReport. i.e. 29th July 2016.
7. Details of significant and material orders passed by the regulators or courts ortribunals impacting the going concern status and company's operations in future
Order dated 23rd October 2013 passed by Securities and Exchange Board of India:
As reported earlier SEBI Vide Interim Order dated 21st September 2011 had issueddirections to the Company not to issue equity or any other instruments convertible intoequity or alter capital structure in any manner till further directions which wasconfirmed on 30th December 2011. The SEBI further issued a final order dated 23rdOctober 2013 against the Company which operative portions are as under:
a. That the Company will not issue equity shares or any other instruments convertibleinto equity shares or any other security for a period of ten years.
b. Vide Interim Order dated September 21 2011 (later confirmed through theConfirmatory Order on December 30 2011) the Company was directed not to issue equityshares or any other instrument convertible into equity shares or alter their capitalstructure in any manner till further directions. In this context the Company has alreadyundergone the prohibition imposed vide the Interim Order for a period of approximately twoyears. In view of this factual situation it is clarified that the prohibition alreadyundergone by the Company pursuant to the aforementioned SEBI Order shall be reduced whilecomputing the period in respect of the prohibition imposed vide this order.
From the above Order it is clear that the Company is restrained from issuing anyfurther equity shares or any other instruments convertible into equity shares or anyother security effectively for a period of eight years (approx) from the date of theorder.
Hence the Company has already undergone the prohibition imposed vide the Interim Orderfor a period of approximately two years before the final order and around three years fromthe date of final order i.e. almost half of the prohibitory order of SEBI has beensurvived by the Company.
The Company's various efforts to restart the project also failed due to the embargo onissue of new equity by SEBI. The aforesaid order has also compelled the Company to standstill its project. The company finds it difficult to arrange funds for its day to dayoperations.
The aforesaid restrictive order has built such adverse circumstances wherein theCompany is not able to move ahead with its project and various contracts and agreementswhich were entered into and for which advances were paid have expired long back. TheManagement in the previous financials has written off such advances pre-operativeexpenses consultancy fee and capital work in progress to give true and fair picture ofthe financials though such writing off completely eroded the net worth of the Company.
The Auditors of the Company has taken note of the same and qualified their Reportraising their apprehension on the going concern status of the Company. The management hasgiven their detailed comments on such qualification of the Auditor's at the later part ofthis Report. Though it is pertinent to note that the ability of the Company to continue asa going concern is significantly dependent on getting a favourable order from SAT and themanagement is expecting for such favourable order.
8. Details in respect of adequacy of internal financial controls with reference to theFinancial Statements
The Company has adequately adopted the procedures to ensure the proper internalcontrol suitable policies and guidelines as required under various provisions of theCompanies Act 2013 and the Listing Agreement/Regulations are in place. These policiese.g. Vigil Mechanism Policy/Whistle Blower Policy Risk Management Policy are meant toadhere the proper guideline rules and regulations to comply with the requirement of thelaw to reduce the possible threats of fraud and to ensure the orderly and efficientconduct of the business of the Company. These policies and guidelines are adequatelymonitored by the designated Committees of the Board. The Members be further apprised thatearlier the affairs of Risk Management were being looked after by the Risk ManagementCommittee of the Company however the Board resolved to dissolve the said committee andterms of reference of the same shall be looked after by the Audit Committee of theCompany.
The Company apart from the above has in place a system of I nternal Control adequate inrespect to the size and operations of the Company. M/s Amar Jeet Singh & Associateshad been the Internal Auditor of the Company for the financial year 2015-16. He has beenconducting internal audit at regular intervals at every quarter ending. No materialdiscrepancies have been reported by him during the period of his Audit. The Companyprepared the financial information/Reporting as per the requisite requirements of theCompanies Act 2013 and the Listing Agreement and placed it to the Audit Committee andBoard for the approval once approved the said financial results are submitted to thestock exchange and also placed on the website of the Company.
9. Details of Subsidiary/ Joint Ventures/ Associate Companies
The Company neither has any Subsidiary nor any Joint Venture or Associate Company.Since the Company is not having any Subsidiary accordingly no policy has been formulatedfor determining Material Subsidiaries.
10. Performance and financial position of each of the subsidiaries associates andjoint venture companies included in the consolidated financial statement
The Company is not having any Subsidiary Joint Venture or Associate Company.
The Company has not accepted any deposits during financial year 2015-16 under theprovisions of Chapter V of Companies Act 2013.
12. Statutory Auditors
M/s VATSS & Associates Chartered Accountants (ICAI Firm Registration No.-017573N) were appointed as Statutory Auditors of the Company for a period of 5 years inthe previous Annual General meeting (AGM) of the Company held on 25th September 2015subject to ratification of their appointment by the members in every subsequent AGM. Theyhave completed the audit of the Company for the financial year 2015-16. The Board herebyrecommends appointment of M/s VATSS & Associates Chartered Accountants as thestatutory auditors of the Company for the financial year 2016-17 for ratification of themembers. Members are requested to consider and ratify the same.
13. Auditor's Report
The Auditors have qualified their Audit Report issued to the Company by stating thefollowing qualification:
"Attention of the matters is invited to note no. 27(d) of the notes to accountsregarding the financial statements of the Company having been prepared on a Going concernbasis notwithstanding that due to continuous losses incurred by the Company during thepast years and current year the accumulated losses of the Company have far exceeded itsnet worth resulting in negative net worth on balance sheet date. The Company haswritten-off a substantial part of its Fixed Asset during the previous year. This situationindicates the existence of a material uncertainty that may cast a significant doubt on theCompany's ability to continue as a Going concern."
The Board considered the aforesaid qualification and recorded its comment as below:
The board noted qualified opinion of the Auditors raising the concern on the ability ofthe Company to continue as going concern.
It is a matter of record that the Losses suffered during the previous years were onaccount of expenses incurred as preoperational expenses of the project since 2011 duringits project implementation phase. In 2011 SEBI has issued its interim order prohibitingthe Company from entering into the capital market or issuing any kind of securities andaltering its capital structure. This order hugely impacted the capacity of the Company toraise funds and thus the project implementation process got slowed. The aforesaid order ofthe SEBI was further confirmed by the final order dated 23rd October 2013. The said orderhas been challenged at Securities and Appellate Tribunal for which the proceeding isgoing on. This restrictive order has brought this Company to be in a position where noproject could be implemented and no source of income could be generated till date whichhas in turn resulted into the accumulated losses for the Company over the years.
Before taking decision of such writing off of substantial part of the Fixed Assetsduring the previous financial year the Board also took note of the Auditor's Observationwhich was made by them in the meeting of the Board held on 10th February 2015. The Boardrecorded the fact that the writing off of the Fixed Assets were required and mandated togive a true and fair picture of the financial statement.
The Board further took legal opinion on this matter from one of the leading law housesin Delhi and after considering the various aspects of the legal opinion and also afterconsidering the possibilities of recovery of the Capital advances or the enforceability ofsuch Contracts (including novation) consented to write off these advances.
However the Supreme Court Judgment of Salim Akbarali Nanji Vs Union of India (UOI) andOrs was taken note of.; In this case it was held that the concept of writing offdebts is an internal management/ accounting procedure to clean up the balance sheet of acompany. Such procedure/ decision to write off an advance/ debt can be resorted to even incases where a party has not exhausted all the avenues for recovery of dues. It has noimpact on the right of a party to proceed against the opposite party. Nor does it bar orrender non-maintainable recovery proceedings.
The board recorded that the decision of writing off is necessary to give true and fairview of the financial statement of the Company the Board decided to write off other FixedAssets and advances which is having similar nature as aforesaid and accordingly variousadvances fixed assets and Pre-operative expenses were written off by the Board. Detailsof write offs are appropriately explained in the notes to the accounts.
The management is hoping to receive a favourable order from the SAT proceedings whichCompany has initiated against the restrictive orders of the SEBI which will positivelyimpact the future of the Company. In view of the willingness to start the project once thefavourable business conditions are in the Management has taken stand to continue theaccounting of the business as Going Concern.
14. Share Capital
The Company's Capital Structure remains unchanged during Financial Year 2015-16.
15. Extract of the annual return
The extract of the annual return in Form No. MGT - 9 is annexed as Annexure -01.
16. Conservation of energy technology absorption and foreign exchange earnings andoutgo
The details of conservation of energy technology absorption foreign exchange earningsand outgo are as follows:
(A) Conservation of energy and Technology absorption
The Company has not initiated its operations till date no particulars in respect ofconservation of energy and technology absorption have been furnished as per Section134(3)(m) of the Companies Act 2013. However in use of office appliances precautions aretaken to ensure saving of energy.
(B) Foreign exchange earnings and Outgo
There were no foreign exchange earnings and outgo during the year under review.
17. Corporate Social Responsibility (CSR)
The disclosures as per Rule 9 of Companies (Corporate Social Responsibility Policy)Rules 2014 is enclosed as Annexure-02.
A) Changes in Directors and Key Managerial Personnel (KMP):
Cessation of Directors/KMP:
During the year under review Mrs. Rekha Sarda had resigned from her office ofthe Chief Financial Officer (CFO) of the Company w.e.f. 29th July 2015.
Later Ms. Monika Moorjani resigned from her office as Director of the Companyw.e.f. 23rd March 2016. Appointment of New Directors/KMP:
Pursuant to the requirements of Section 203 read with Rule 8 of Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 the office of CFO wasvacant in the Company. Considering the said requirements the Board resolved to appointMr. Raman Mallick as the new CFO of the Company w.e.f. 06th November 2015 based on hisqualifications experience and background and also considering the present scenario of theCompany. The members be further apprised that Mr. Raman Mallick had been previouslyemployed in group Company and was handling all the account/finance and banking activities.He has been employed in group companies since previous 8 years and is acquainted with thepositions of the Company.
To meet the requirements of woman Director on Board as per Companies Act 2013and the SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015management approached and requested Ms. Monika Moorjani to consider joining the Board onceagain Ms. Moorjani consented to be appointed again as a Director of the Company underIndependent - Non Executive & Woman Category w.e.f. 27th May 2016.
Reappointment of Directors:
Ms. Monika Moorjani is being taken on the Board as an Additional Director whose officeof Directorship in the Company shall continue till the date of ensuing Annual GeneralMeeting of the Company. The Company has received notices under Section 160 (1) of theCompanies Act 2013 from member(s) proposing her candidature for appointment as director.The Board of Directors has recommended her appointment and a suitable resolution is beingmoved through AGM Notice for the necessary approval of the shareholders.
Further subject to the provisions of Section 152(6) of Companies Act 2013 Mr. DeepKumar Rastogi Director of the Company is liable to retire by rotation at the ensuingAnnual General Meeting and being eligible has offered himself for re-appointment. Briefresume of directors seeking appointment and re-appointment along with other details asstipulated under Regulation 36 of SEBI (Listing Obligations & Disclosure Requirements)Regulations 2015 are provided in the AGM Notice for convening the Annual GeneralMeeting.
B) Declaration by an Independent Director(s) & Re- appointment if any
All Independent Directors have submitted declarations that they meet the criteria ofindependence as laid down under Section 149(6) of the Companies Act 2013 and Regulation16 (1) (b) of SEBI (Listing Obligations & Disclosure Requirements) Regulations 2015.
C) Details of training imparted to Independent Directors Every new Independent Directorinducted on the Board attends an orientation program in which he/she is familiarized withthe strategy operations and Status of the Company. They are further briefed with historyof the Company and also handed over a Copy of the bunch of Company's Annual Reports itsMemorandum and Articles of Association various policies and the Code of Conduct of theCompany. One familiarization program was conducted on 06th November 2016 details of thesame are placed on the website of the Company a web link thereto is given below:
Further at the time of appointment of an Independent Director the Company issues aformal letter of appointment outlining his/her role functions and duties/responsibilitiesas a Director. The Format of the letter of appointment is provided on our website a weblink thereto is given below:
D) Formal Annual Evaluation
The Companies Act 2013 and SEBI (Listing Obligations & Disclosure Requirements)Regulations 2015 states that a formal annual evaluation needs to be made by the Board ofits own performance its committees Chairman and individual Directors. Schedule IV of theCompanies Act 2013 states that the performance evaluation of Independent Directors shallbe done by the entire Board of Directors excluding the Director being evaluated.
The Independent Directors of the Company in their meeting held on February 09 2016reviewed the performance of the Non Independent Directors in case of our Company Mr.Deep Kumar Rastogi the Executive Chairman of the Company and the Board as a whole.Further the Board of Directors in their meeting held on May 27 2016 evaluated theperformance of all the Independent Directors based on set questioners circulated to theBoard. Also the Nomination and Remuneration Committee in meeting held on May 27 2016evaluated every director's performance. On the Basis of the above evaluations theperformance of the entire Board Executive Directors and Independent Directors were foundsatisfactory specially taking into consideration the existing circumstances in which theCompany is operating.
19. Number of meetings of the Board of Directors
The Board met 6 times during the year the details of which are given in CorporateGovernance Report forming part of this annual report. The intervening gap between any twomeetings was within the prescribed time limit under Companies Act 2013.
20. Audit Committee
During the year the Audit Committee was constituted with Mr. Sameer Rajpal Chairmanof the Committee Mr. Pranav Kumar and Mr. Deep Kumar Rastogi.
A detailed description about the audit Committee is given in the Corporate GovernanceReport forming part of the Director's Report.
Further all recommendations made by Audit Committee during the year were accepted bythe Board.
21. Details of establishment of vigil mechanism for directors and employees
The Company has in place a Vigil Mechanism/Whistle Blower Policy framed as per therequirements of Section 177 of Companies Act 2013 and Clause 49(II)(F) of the ErstwhileListing Agreement [Now Regulation 22 of SEBI (Listing Obligations & DisclosureRequirements) Regulations 2015]. A weblink to the policy is mentioned below:
22. Nomination and Remuneration Committee
The policy formulated by the Board relating to the remuneration for the Directors KeyManagerial Personnel and other employees and also the Criteria for determining theQualifications positive attributes and Independence of a Director pursuant to Section178(3) of Companies Act 2013 is annexed as Annexure-03 to this Report.
23. Particulars of loans guarantees or investments under section 186
The Company has not granted any Loans extended any Guarantees or made Investmentsduring the Financial year 2015-16 pursuant the provisions of Section 186 of CompaniesAct 2013.
24. Particulars of contracts or arrangements with related parties
The Company has not made any contracts with related parties pursuant to Section 188 ofCompanies Act 2013.
However your Company has been obtaining loan from Nyra Holdings Pvt. Ltd. a relatedparty as per Section 2 (76) of the Companies Act 2013 to meet its day to day financialneeds and also to meet the statutory dues necessary compliances and the legal expenses.Such arrangements of obtaining loan from related party falls into the category of materialrelated party transaction as per Regulation 22 of SEBI (Listing Obligations &Disclosure Requirements) Regulations 2015.
Further Explanation to Regulation 23(1) of SEBI (Listing Obligations & DisclosureRequirements) Regulations 2015 differentiates between a related party transaction and amaterial related party transaction it prescribes the limit of the transaction which willbe treated as the material related party transaction i.e. "transaction/s withrelated party being entered individually or taken together with previous transactionduring a financial year exceeds 10% of the annual consolidated turnover of the Company asper the last audited financial statement will be material related party transaction. SubRegulation 8 of this Regulation mandates that all existing material related partytransactions entered into prior to the date of notification of these regulations i.e.02nd September 2015 and which may continue beyond such date shall require approval of theshareholders in the first General Meeting subsequent to notification of theseregulations. This is to note that pursuant to clause 49 (VII)(B) of the erstwhile ListingAgreement which correspond to the aforesaid Regulation 23 of the Listing Regulations theCompany has already taken the requisite approval of the shareholders in this respect inthe Annual General Meeting held in the previous year on 25th September 2015 that is the1 st General Meeting held after the notification of the Listing Regulations. Hence theapproval of the shareholders to enter into such material related part transaction is inplace and Company has complied with the requirements.
As on the date of the Balance sheet of 31st March 2016 your company has borrowed asum of Rs. 80890000/- from Nyra Holdings Private Limited however in the financial year2015-16 the total borrowing from the said related party was Rs. 12630000/-.
Moreover the Company has formulated a policy on materiality of related partytransactions and also on dealing with Related Party Transactions which can be downloadedfrom the link mentioned below:
25. Managerial Remuneration
Disclosure pursuant to Section 197(12) of Companies Act 2013 and Rule 5 of Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 is provided below: i)The Ratio of the remuneration of each Director to the Median remuneration of the employeesof the Company for the year 2015-16:
|Directors ||Nature of Directorship ||Ratio |
|Mr. Deep Kumar Rastogi ||Whole time Director & Executive Chairman ||N.A.* |
|Mr. Pranav Kumar ||Non-Executive Independent Director ||1:9.948 |
|Mr. Sameer Rajpal ||Non-Executive Independent Director ||1:9.948 |
|Mrs. Monika Moorjani ||Non-Executive Independent Director ||1:19.896 |
*Mr. Deep Kumar Rastogi had opted not to withdraw any remuneration while he wasappointed as Whole Time Director.
ii) The percentage increase in remuneration of each Director CFO CEO CS or Managerin the financial year:
There was no increase in the remuneration of any of the Director during the financialyear 2015-16.
The remuneration (as per the provision of section 17 (1) of Income Tax Act 1961) ofCompany Secretary of the Company has been increased by 3.07% respectively from financialyear 2014-15 Mr. Raman Mallick was appointed as the CFO of the Company during thefinancial year hence no percentage increase in his remuneration is recorded.
iii) The percentage increase in the median remuneration of employees in the financialyear:
The median remuneration of employees has been reduced from the previous year due to thedifference in the salary being paid to the Mrs. Rekha Sarda the Ex-CFO of the Company andMr. Raman Mallick the current CFO of the Company.
iv) The number of permanent employees on the rolls of Company:
During the year 2015-16 there were 3 employees on the rolls of the Company. New CFOMr. Raman Mallick was appointed at the place of outgoing CFO of the Company in the middleof the year hence as on 31st March 2016 only 3 employees were continuing on the rollsof the Company.
v) Average percentile increase already made in the salaries of employees other thanmanagerial 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:
As reported above total 3 employees are on the rolls of the Company out of which twobeing the KMPs (CS & CFO) and one other employee in the operations department. Therehas been no increase in the remuneration of any employee other than Company Secretary ofthe Company during the reporting period. The CFO of the Company was appointed during theyear hence no such increment in his salary was made during the year however the thirdemployee works for the operations department and considering the fact that the projectcould not take off the work relating to operational activity is very limited andconfined. The management for the aforesaid reasons did not consider the increase in hisremuneration during the year.
vi) The Remuneration is as per the remuneration policy of the Company.
vii) The names of Top 10 employees in terms of remuneration are:
|Name of employee ||Designation |
|Mr. Suvindra Kumar ||Company Secretary |
|Mr. Raman Kumar ||Chief Financial |
|Mallick ||Officer |
|Mr. Debashish Bera ||Officer Commercial |
viii) There were no employees in the Company during the year who were in receipt ofremuneration in excess of Rs. 10200000/- per annum or Rs. 850000/- per month.
26. Secretarial Audit Report
A Secretarial Audit Report in Form No. MR-3 for the Financial year 2015-16 given byM/s. KBK & Co. Company Secretaries is annexed as Annexure-04 with this report.
The following disclosures have been made by the Secretarial Auditor in his reportrequiring explanation:
"Share application money for an amount of Rs 15757463/- remains pending forallotment. "
Since the situation w.r.t the circumstances in this matter has not changed hence theexplanation to the Secretarial Auditor was the same as given earlier which state asbelow:
It has been explained to the Secretarial Auditor that the above mentioned amount of Rs.15757463/- is part of FDI which was received from M/s Abboro Limited a foreign BodyCorporate. This amount is pending for allotment due to the restrictive order of SEBI dated23rd October 2013 which has restricted the Company from accessing the Capital marketsand/or issuing shares and/or any other instruments convertible into equity or altering itscapital structure. Though the Company through its letter dated 12th May 2015 and reminderletter dated 29th May and 7th December 2015 had asked for a special permission from SEBIunder intimation of Registrar of Companies NCT of Delhi and Haryana for the relaxationin its order so that the equity shares could be allotted to M/s Abboro Limited.
The same fact has been suitably recorded by the Secretarial Auditor in his Report.
27. Risk management policy
Pursuant to the requirements of Regulation 21 of SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 (Earlier Clause 49(VI) of the Listingagreement) the Board had constituted the Risk Management Committee and had also laid downthe Risk Management Plan of the Company. The Committee was responsible for the monitoringand reviewing of the Risk Management Plan. The Major element of Risk which may threatenthe existence of the Company is to be identified and laid down in the Risk Management Planof the Company.
However as per Regulation 21 (5) of the SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 the provisions of Clause 49(VI)(C) [Now Regulation 21(1)of the SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015] statesthat the risk management committee are applicable only to top 100 listed Companies basedon the market Capitalization as at the end of the immediate previous financial year.
In light to the aforesaid situation the Company was not required to maintain the saidCommittee as it do not stand in the top 100 listed Companies based on the said marketcapitalization. Hence the Board in their meeting held on 09.02.2016 dissolved the saidCommittee with immediate effect.
It was ensured that the Risk Management System/policy of the Company is now to belooked after by the Audit Committee. The system to analyse the Risk Management isimplemented in such way that it is commensurate with the Nature Size and Operations ofthe Company. The Committee shall look after the areas of Financial Risk and Controls etc.
28. Management Discussion and Analysis Report
The Management Discussion and Analysis Report as required under Regulation 21(1) of theSEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 with the stockExchange forms part of this Report.
29. Corporate Governance Report
A separate Section on Corporate Governance forming part of the Director's Report and acertificate from the Practicing Company Secretary confirming compliance of the CorporateGovernance Norms as stipulated in Regulation 34 (3) read with Schedule V of the SEBI(Listing Obligations and Disclosure Requirements) Regulations 2015 is included with thisAnnual Report.
30. Listing of Securities
The Securities of your Company are currently listed with Bombay Stock Exchange (BSE)with ISIN- INE40C01022 and scrip code 526652. The Company has paid listing fee to theBombay Stock Exchange for the financial year 2015-16. All compliances with respect to thelisting agreement/regulations is being made in regular course.
31. Director's Responsibility Statement
In terms of the provisions of Section 134(5) of the Companies Act 2013 your Directorsconfirm 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 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 in the case of a listed company had laid down internal financialcontrols to be followed by the company and that such internal financial controls areadequate and were operating effectively.
(f) The directors had devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems were adequate and operating effectively.
Your Directors wish to place on record their appreciation for the
Co-operation and Assistance received from Regulatory Bodies
Government Bankers Shareholders business associates and various other Stakeholderswho have extended their valuable sustained support and encouragement during the yearunder review.
The Directors would also like to place on record a hearty thanks to the management andthe employees of the Company who have been standing with the Company and giving theirtireless support in the adverse circumstances.
For and on behalf of the Board of Directors
|(Deep Kumar Rastogi) ||(Sameer Rajpal) |
|Executive Chairman ||Director |
|DIN :01229644 ||DIN :05184612 |
|Place : New Delhi || |
|Date : 29.07.2016 || |