Your Directors present herewith the 31st Annual Report of the Company forthe year ended 31st March 2016.
| || ||(Amt. in Lakhs) |
|PARTICULARS ||For the Year Ended 31.03.2016 ||For the Year Ended 31.03.2015 |
|Sales ||326.40 ||503.44 |
|Other Income ||12.49 ||6.94 |
|Total Income ||338.89 ||510.38 |
|Total Expenditure ||335.11 ||502.35 |
|Profit/(Loss) before tax ||3.78 ||8.03 |
|Provision for Tax ||1.24 ||2.68 |
|Net Profit/(Loss) ||2.74 ||5.35 |
|Paid Up Share Capital ||445.70 ||445.70 |
REVIEW OF OPERATION
During the year under review your Companys performance satisfactory under thechallenging market circumstances. The turnover and the net profit of the company hasdecreased by 35.11% and by 63.73% respectively in comparison to the turnover and netprofit of the previous year. The Company has earned the total revenue of Rs. 326.40 Lakhand other income of Rs. 12.49 Lakh as compared to Rs. 503.44 Lakh of Sale and Rs. 6.94Lakh of other incomes in previous Financial Year. The profit margin of the company hascontracted.
The issued subscribed and paid up capital of the Company is Rs 44570040 (Rupees FourCrore Forty Five Lacs seventy Thousands Forty) divided into 44 57004 (Forty four lacsfifty seven thousands four) equity shares of Rs 10 each. There has been no change in theshare capital of the Company during the year.
The Board of Directors of your Company is of the opinion that keeping in view thefuture fund requirements of the Company and average financial performance your Directorshave not recommended any dividend on equity shares for the year under review. The Boardassures you to present a much strong financial statements in coming years.
The net movement in major reserves of the Company for Financial Year 2015-16 and theprevious year as follows:
|Particulars ||31/03/2016 ||31/03/2015 |
|Surplus in Statement of Profit and Loss || || |
|Opening balance ||2635680 ||2131174 |
|Net Profit / (Loss) for the year ||274206 ||534752 |
|Excess / (Short) of Previous Years ||- ||(30246) |
|Sub Total ||2909886 ||2635680 |
|(-) Utilized for issue of Bonus Shares ||- ||- |
|(-) Tax on Dividend ||- ||- |
| ||2909886 ||2635680 |
DETAIL OF BOARD MEETING
The Board met Six times during the financial year. The gap between any two meetings waswithin the period prescribed by the Companies Act 2013
STATEMENT OF DECLARATION GIVEN BY INDEPENDENT DIRECTOR
The Board of Directors of the Company has received declaration of Independence fromeach Independent Director in pursuance of section 149(7) of the Companies Act 2013.
POLICY REGARDING THE APPOINTMENT OF BOARD OF DIRECTORS
The Board of Directors adopted uniform policy for the appointment of Director inpursuance of various provisions of Companies Act and Listing Agreement.
Detail of Board of Directors
|Sr. No. Name of Director ||Designation ||Date of Appointment ||Date of Cessation |
|1. Gagan Anand ||Managing Director ||30.05.2016 ||- |
|2. Arvind Agarwal ||Director ||01.03.2013 ||- |
|3. Kuldip Singh ||Director ||14.06.2013 ||- |
|4. Preeti Srivastava ||Director ||31.03.2015 ||- |
|5. Rajesh Agarwal ||Director ||01.03.2013 ||19.10.2015 |
CRITERIA FOR DETERMINING QUALIFICATIONS POSITIVE ATTRIBUTES AND INDEPENDENCE OF ADIRECTOR
The Nomination and Remuneration Committee has formulated the criteria for determiningqualifications positive attributes and independence of Directors in terms of provisionsof Section 178 (3) of the Act is annexed as Annexure 1 to this Report.
ANNUAL EVALUATION OF PERFORMANCE OF BOARD OF DIRECTORS AND ITS COMMITTEES
Pursuant to the provisions of the Act the Board has carried out an annual evaluationof its own performance performance of the Directors individually as well as theevaluation of the working of its Committees. The following process was adopted for BoardEvaluation:
Feedback was sought from each Director about their views on the performance of theBoard covering various criteria such as degree of fulfillment of key responsibilitiesBoard structure and composition establishment and delineation of responsibilities tovarious Committees effectiveness of Board processes information and functioning Boardculture and dynamics quality of relationship between the Board and the Management andefficacy of communication with external stakeholders. Feedback was also taken from everydirector on his assessment of the performance of each of the other Directors.
Every statutorily mandated committee of the Board conducted a self-assessment of itsperformance and these assessments were presented to the Board for consideration. Areas onwhich the Committees of the Board were assessed included degree of fulfillment of keyresponsibilities adequacy of Committee composition and effectiveness of meetings.
Feedback was provided to the Directors as appropriate. Significant highlightslearning and action points arising out of the evaluation were presented to the Board.
In accordance with the requirements of the Companies Act 2013 and the CompanysArticles of Association there is no such Director who is eligible for retire by Rotation.The Company has received declarations from all the Independent Directors of the Companyconfirming that they meet the criteria of independence as prescribed under Section 149(6)of the Companies Act 2013
During the year Company has appointed Mr. Gagan Anand as Managing Director and ChiefFinancial Officer of the Company with effect from 30th May 2016. Also Mr.Rajesh Agarwal Managing Director has resigned from the post with effect from 19thOctober 2015.
REMUNERATION POLICY FOR THE BOARD OF DIRECTORS KEY MANAGERIAL PERSONNEL AND OTHEREMPLOYEES
In terms of the provisions of Section 178(3) of the Act and as per the ListingAgreement the Nomination and Remuneration Committee is responsible for formulating thecriteria for determining qualification positive attributes and independence of aDirector. The Nomination and Remuneration Committee is also responsible for recommendingto the Board a policy relating to the remuneration of the Directors Key ManagerialPersonnel and other employees. In line with this requirement the Board has adopted thePolicy on Board Diversity and Director Attributes and Remuneration Policy for DirectorsKey Managerial Personnel and other employees of the Company. The Remuneration Policy isannexed as Annexure 2 to this report.
COMMITTEES OF THE BOARD
The Committees of the Board focus on certain specific areas and make informed decisionsin line with the delegated authority. The following substantive Committees constituted bythe Board function according to their respective roles and defined scope:
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION
The information on conservation of energy and technology absorption stipulated underSection 134 (3) (m) of the Act read with Rule 8 of The Companies (Accounts) Rules 2014:
The Company did not use any energy during the year under review. Your Company isconscious about its responsibility to conserve energy power and other energy sourceswherever possible.
Further your company has not imported any technology. However we believe and useinformation technology in all spheres of our activities to improve efficiency levels.
FOREIGN EXCHANGE EARNINGS AND OUTGO
Detail of Foreign exchange earnings and outgo of your Company is below mentioned:
|Particulars ||FY 2016 ||FY 2015 |
|Foreign Exchange earning ||0.0 ||0.0 |
|Foreign Exchange outflow ||0.0 ||0.0 |
LISTING ON THE STOCK EXCHANGE
The Company's shares are listed with BSE Limited and the Company has paid the necessarylisting fees for the Financial Year 2016-17
CORPORATE GOVERNANCE REPORT
In pursuance of SEBI Circular CIR/CFD/POLICY CELL/7/2014 dated September 15 2014Regulation 27(2) of SEBI (Listing Obligations and Disclosure Requirements) Regulations2015 shall be applicable on those companies having paid up equity share capital exceedingRs.10 crore and Net Worth exceeding Rs.25 crore as on the last day of the previousfinancial year. The paid up share capital and net worth of your company do not qualify forapplicability of Regulations of SEBI disclosure requirement. Therefore separate Report ofCorporate Governance is not attached herewith.
In spite of above said SEBI circular Your Company adopts best practices for corporategovernance disclosure standard and enhanced shareholder value while protecting theinterest of all other stakeholders including clients its employee. This has enabled yourCompany to earn the trust and goodwill of its investors business partners employees andthe communities in which it operates. Your directors believe that Company profitabilitymust go hand in hand with a sense of responsibility towards all stakeholders employee andcommunities.
RELATED PARTY TRANSACTION
There were no contracts or arrangements entered into by the Company in accordance withthe Section 188 of the Companies Act 2013.
The Company has not accepted any deposits during the under review.
DIRECTORS RESPONSIBILITY STATEMENT IN PURSUANCE OF SECTION 134(3)(C) OF THECOMPANIES ACT 2013
The financial statements are prepared in accordance with the Accounting standard asprescribed under Section 133 of the Companies Act 2013 (the Act) read withRule 7 of the Companies (Accounts) Rules 2014 the provisions of the Act (to the extentnotified) and guidelines issued by the Securities and Exchange Board of India (SEBI).There are no material departures from prescribed accounting standards in the adoption ofthese standards. The directors confirm that:
In preparation of the annual accounts for the financial year ended March 312016 the applicable accounting standards have been followed.
The directors have 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.
The directors have taken proper and sufficient care towards 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.
The directors have prepared the annual accounts on a going concern basis.
The directors have laid down internal financial controls which are adequate andare operating effectively.
The directors have devised proper systems to ensure compliance with theprovisions of all applicable laws and such systems are adequate and operating effectively.
EXTRACT OF ANNUAL RETURN
In accordance with Section 134(3)(a) of the Companies Act 2013 an extract of theannual return in the prescribed format is appended as Annexure 3 to the Board's report.
At the Annual General Meeting held on 29th September 2014 Sudhir Agarwal &Associates Chartered Accountants were appointed as statutory auditors of the Company tohold office till the conclusion of the Annual General Meeting to be held in the calendaryear 2019. In terms of the first proviso to Section 139 of the Companies Act 2013 theappointment of the auditors shall be placed for ratification at every Annual GeneralMeeting. Accordingly the appointment of Sudhir Agarwal & Associates CharteredAccountants as statutory auditors of the Company is placed for ratification by theshareholders. In this regard the Company has received a certificate from the auditors tothe effect that if they are reappointed it would be in accordance with the provisions ofSection 141 of the Companies Act 2013. The Auditor Report for the FY 2014-15 forms partof the Annual Report as Annexure 4 to the Boards Report. Auditors Report in respectof the Financial Statement for the current Financial Year given by M/s. Sudhir Agarwal& Associates Chartered Accountant is self Explanatory and the Statutory Audit Reportdoes not contain any qualification reservation or adverse remark.
RANJEET VERMA & ASSOCIATES Practicing Company Secretary was appointed to conductthe secretarial audit of the Company for the financial year 2015-16 as required underSection 204 of the Companies Act 2013 and Rules thereunder. The secretarial audit reportfor FY 2015-16 forms part of the Annual Report as Annexure 5 to the Board's report.
In the opinion and to the best of the information and according to the records andexplanation provided to Secretarial Auditor Auditor has found the following observations:
1. NON COMPLIANCE IN APPOINTMENT OF COMPANY SECRETARY OF THE COMPANY
As per the provisions of the section 203 of the Companies Act 2013 & otherapplicable laws a listed company has whole time company secretary in employment.
As per the records provided to us and examined by us the Company has not appointed awhole time Company Secretary
2. NON COMPLIANCE IN APPOINTMENT OF CHIEF FINANCIAL OFFICER OF THE COMPANY
As per the provisions of the Companies Act 2013 & other applicable laws a listedcompany must have Chief Financial Officer of the Company.
As per the records provided to us and examined by us the Company has not appointedChief Financial Officer.
3. NON COMPLIANCES OF SS-1 & SS-2 (MINUTES OF BOARD MEETING & GENERAL MEETING)
As per the requirement of the Companies Act 2013 Secretarial Standards issued by ICSIand other applicable laws.
Every listed company and other specified companies have to maintain minutes of theirall meetings as per the SS-1 & SS-2.
As per the records provided to us and examined by us The Company has not prepared theminutes & notices of Board Meeting General Meeting and other Meeting as applicableto the Company as per the requirement of SS-1 & SS-2 and other applicable provisionsof the Companies Act 2013.
4. STATUTORY RECORDS NOT MAINTAINED AS PER THE REQUIREMENT OF COMPANIES ACT 2013 &OTHER APPLICABLE LAWS
- The maximum Statutory Records of the Company are maintained as soft copy.
- The Various Registers of the Company are not properly maintained.
5. NON COMPLIANCE OF FORM MBP-1(DISCLOSURE OF INTEREST OF DIRECTOR)
As per the requirement of Section 184 of companies Act 2013 every Director of thecompany has to disclose his interest by giving a notice in writing in form MBP-1.
The Form MBP-1 was not prepared as per the requirement of the Section 184 of theCompanies Act 2013. The Directors of the Company have not disclosed their interest inwriting as per the applicable provisions.
6. NON UPDATION OF THE COMPANYS WEBSITE
The Website of the company is under the process for updation .
Management assure you that effective stapes will be taken in the coming years to havecompliance with all observation provided by the auditors.
LOANS GUARANTEES SECURITIES AND INVESTMENTS
The Company has given short term loan & Advances of Rs 34352761 in currentfinancial year the details of which is mentioned in the balance sheet attached to thisreport.
SIGNIFICANT AND MATERIAL ORDERS
During the year under Review Trading of Shares was suspended on BSE Limited vide NoticeNo. 20151221-2 dated 21st December 2015. It is also hereby informed thatpursuant to order No. 20160530-13 passed by Honble Delhi High Court dated May 112016 trading in equity shares of the company shall resume wi th effect from Tuesday May31 2016.
INTERNAL FINANCIAL CONTROL
Internal financial control systems of the Company are commensurate with its size andthe nature of its operations. These have been designed to provide reasonable assurancewith regard to recording and providing reliable financial and operational informationcomplying with applicable accounting standards and relevant statutes safeguarding assetsfrom unauthorized use executing transactions with proper authorization and ensuringcompliance of corporate policies. The Company has a well defined delegation of authoritylimits for approving revenue as well as expenditures. Processes for formulating andreviewing annual and long term business plans have been laid down.
The Audit Committee deliberated with the members of the management considered thesystems as laid down and met the statutory auditors to ascertain inter alia their viewson the internal financial control systems. The Audit Committee satisfied itself on theadequacy and effectiveness of the internal financial control system as laid down and keptthe Board of Directors informed.
MATERIAL CHANGES AND COMMITMENT
In the year your Company not entered as such contract agreement or arrangement whichaffects the material position and financial position of the Company.
RISK MANAGEMENT POLICY
The Board of Directors of the Company has formulated a Risk Management Policy whichaims at enhancing shareholders value and providing an optimum risk reward tradeoff.The risk management approach is based on a clear understanding of the variety of risksthat the organization faces disciplined risk monitoring and measurement and continuousrisk assessment and mitigation measures.
PREVENTION OF SEXUAL HARASSMENT
The Company has zero tolerance for sexual harassment at workplace and has adopted apolicy on prevention prohibition and redressal of sexual harassment at workplace in linewith the provisions of the Sexual Harassment of Women at Workplace (PreventionProhibition and Redressal) Act 2013 (POSH Act) and the Rules framed thereunder.
SUBSIDIARIES AND ASSOCIATES
Company does not have any subsidiary or associates Company.
PARTICULARS OF EMPLOYEES
During the year under review no employee is covered as per rules 5(2) & (3) of theCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014 therefore nostatement is required be given showing the names and other particulars of the employeesdrawing remuneration in excess of the limits set out in the said rules are not applicable.
PARTICULARS OF REMUNERATION
The information required under Section 197(12) of the Companies Act 2013 read withRule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules2014
i) The ratio of the remuneration of each Director to the median remuneration of theemployees of the Company for the financial year 2015-16:
No Director has drawn any remuneration from the Company therefore ratio ofremuneration of each director the median remuneration of the employees of the Company is1.9.
ii) The percentage increase in remuneration of each Director Chief Financial OfficerChief Executive Officer Company Secretary or Manager if any in the financial year2015-16:
No Director has drawn any remuneration from the Company during the financial year2014-15 therefore the percentage increase in remuneration is nil.
iii) The percentage increase in the median remuneration of employees in the financialyear 2015-16: During the financial year 2015-16 Company has not paid any remuneration tothe employees. So the percentage increase in median remuneration is not ascertainable.
iv) The number of permanent employees on the rolls of company: 0
v) Average percentile increase already made in the salaries of employees other than themanagerial personnel in the last financial year and its comparison with the percentileincrease in the managerial remuneration and justification thereof and point out if thereare any exceptional circumstances for increase in the managerial remuneration:
No Director has drawn any remuneration from the Company during the financial year2014-15 therefore the Average percentile increase in remuneration is nil.
vi) the key parameters for any variable component of remuneration availed by theDirectors:
The key parameters for the variable component of remuneration if any availed by theDirectors are considered by the Board of Directors based on the recommendations of theNomination and Remuneration Committee as per the Nomination & Remuneration Policy forDirectors.
No Director has drawn any remuneration from the Company during the financial year2015-16.
vii) Affirmation that the remuneration is as per the remuneration policy of theCompany:
It is hereby affirmed that the remuneration paid is as per the Nomination andRemuneration Policy of the Company.
The Company believes in the conduct of the affairs of its constituents in a fair andtransparent manner by adopting highest standards of professionalism honesty integrityand ethical behavior. In line with the Code of Conduct any actual or potential violationhowsoever insignificant or perceived as such would be a matter of serious concern for theCompany. The role of the employees in pointing out such violations of the Code of Conductcannot be undermined.
Pursuant to Section 177(9) of the Act a vigil mechanism was established for directorsand employees to report to the management instances of unethical behavior actual orsuspected fraud or violation of the Companys code of Conduct or ethics policy. TheVigil Mechanism provides a mechanism for employees of the Company to approach the Chairmanof the Audit Committee of the Company.
Directors wish to place on record their deep thanks and gratitude to;
a) The Central and the State Government as well as their respective Departments andDevelopment Authorities connected with the business of the Company the Bankers of theCompany as well as other Institutions for their co-operation and continued support.
b) The Shareholders Suppliers and the Contractors for the trust and confidence reposedand to the Customers for their valued patronage.
c) The Board also takes this opportunity to express its sincere appreciation for theefforts put in by the officers and employees at all levels in achieving the results andhopes that they would continue their sincere and dedicated endeavour towards attainment ofbetter working results during the current year.
| ||By the order of Board of Director of Divinus Fabrics Limited |
| ||(Formerly known as Avishkar Finance Company Limited) |
|Regd. Office: || || |
|Plot No. 15 B-2 D Block Market || || |
|Vivek Vihar Delhi 110095 || || |
| ||Sd/- ||Sd/- |
|Date: 03.08.2016 ||Gagan Anand ||Arvind Agrawal |
|Place: New Delhi ||Managing Director ||Director |
| ||DIN: 06957651 ||DIN: 03035484 |