Your Directors have pleasure in presenting 32nd Annual Report for the nine monthsperiod ended on March 31 2016. The Accounting year of the Company has been changed fromJuly June to April-March in line with the provisions of Section 2(41) of theCompanies Act 2013 which prescribe a uniform financial year. Accordingly current year'sAnnual Accounts and Report of the Company are for a period of nine months from July 12015 to March 31 2016. These figures therefore are not comparable with those of theprevious financial year ended on June 30 2015.
FINANCIAL RESULTS FOR THE NINE MONTHS ENDED ON MARCH 31 2016
|Particulars ||9 Months ended on March 31 2016 ||Financial year ended on June 30 2015 |
|Operating Loss ||(3.13) ||(12.75) |
|Interest || || |
|Gross loss ||(3.13) ||(12.75) |
|Depreciation ||9.65 ||21.77 |
|Profit/(Loss) Before tax ||(12.78) ||(34.52) |
|Provision for Tax || || |
|Net Profit/(Loss) after Tax ||(12.78) ||(152.08) |
|Transfer to General Reserve || || |
|Balance carried to Balance Sheet ||(12.78) ||(152.08) |
The total income of the Company in the current year has been Rs. 23.66 Lacs and in theprevious year it was Rs. 32.65 Lacs. Your Company has incurred loss of Rs. 12.78 Lacs inthe current year and in the previous year it was Rs. 152.08 Lacs.
DIVIDEND & TRANSFER TO RESERVE
In view of the loss for the nine months period ended on March 31 2016 no amount isproposed to be transferred to the reserve(s) and your Directors have not recommendedpayment of any dividend for the year under review.
During the aforesaid period there was no change in the paid up Equity Share in theFinancial Year for the
nine months ended on March 31 2016.
NUMBER OF BOARD MEETINGS
During the period of nine months ended on March 31 2016 the Board of Directors met 3(three) times viz. on August 27 2015 November 5 2015 and February 10 2016. Themaximum interval between any two meetings did not exceed 120 days. Details of the meetingsof the Board along with the attendance of the Directors therein have been disclosed aspart of the Corporate Governance Report.
COMMITTEE OF THE BOARD OF DIRECTORS
The Board has constituted following committees of Directors to deal with matters andmonitor the activities falling within the respective terms of reference:-
Nomination and Remuneration Committee
Stakeholders Relationship Committee
Corporate Social Responsibility Committee
The details of the membership terms of reference and attendance at the meetings of theabove Committees of the Board are provided in the Corporate Governance Report forming apart of this Annual Report. There has been no instance where the Board has not acceptedthe recommendations of the Audit Committee.
Appointment / Re-appointments:
Retirement by Rotation:
Pursuant to the provisions of the Section 152 of the Companies Act 2013 and theArticles of Association of the Company Mr. Rajnikant Sandesara Non-Executive Directorretires by rotation at the ensuring Annual General Meeting and being eligible offershimself for re-appointment.
Appointment of Independent Director:
The Board of Directors has on the recommendation of the Nomination & Remunerationcommittee appointed Mr. Neeraj Sharma who was appointed as an Additional Director in thecategory of Independent Directors with effect from August 30 2016 and his appointment asan independent Director of the Company for term of five years from September 28 2016 toSeptember 27 2021 is proposed for approval of shareholders at the ensuing 32 AnnualGeneral Meeting. The particulars of Mr.Neeraj Sharma is given in the Notice of theEnsuring 32 Annual General Meeting of the Company
Mr. Tirthesh Thakkar and Mr. Sanjay Chohan Independent Director's stepped down fromthe Board with effect from August 30 2016. The Board wishes to place on record itsappreciation for the valuable contributions made by them to the Board and the Companyduring their tenure.
Mr. Rajbhusan Dixit will continue as Non-Executive Director of the Company.
Your Directors express their profound grief and sorrow on the sad demise of ShreeJayantilal Sandesara. Board of Directors place on record their deep sense of appreciationfor the valuable services rendered by him during his association as a Director of theCompany prior to his sad demise.
DECLARATION OF INDEPENDENCE BY DIRECTOR
Pursuant to the provisions under Section 134(3)(d) of the Companies Act 2013 withrespect to statement on declaration given by Independent Directors under Section 149(6) ofthe Companies Act 2013 the Board hereby confirm that all the Independent Directors ofthe Company have given a declaration and have confirmed that they meet the criteria ofindependence as provided in the said Section 149(6) read with Regulation 16 of Securitiesand Exchange Board of India (Listing Obligations & Disclosure Requirements)Regulations 2015.
SUBSIDIARY ASSOCIATE AND JOINT VENTURE COMPANIES
The Company does not have any subsidiary Joint Venture and associate Company for theperiod of nine months ended on March 31 2016. The Board has approved a policy fordetermining material subsidiaries and same is uploaded on the website of the company. Theweb link for the same is www.ensasteel.com.
During the period of nine months ended on March 31 2016 your Company has not acceptedany fixed deposits from the public falling under Section 73 of the Companies Act 2013read with the Companies (Acceptance of Deposits) Rules 2014. As as on March 31 2016there were no deposits which remained remained unpaid or unclaimed and were due forrepayment.
The Statutory Auditors M/s. H. S. Hathi & Co. Chartered Accountants Mumbai (FirmRegistration
No:103596W) who will retire at the conclusion of 32 Annual General Meeting to be heldon September 28 2016 and being eligible offer themselves for re-appointment. Acertificate from them has been received to the effect that their re-appointment if madewould be within the limits prescribed under Section 141(3)(g) of the Companies Act 2013and that they are not disqualified for such appointment within the meaning of Section 141of the Act.
The observations and comments given by Auditors in their report read together withnotes to Accounts are self explanatory and hence do not call for any further commentsunder Section 134 of the Act. The Auditors' Report does not contain any qualificationreservation or adverse remark.
A Secretarial Audit was conducted during the period of nine months ended on March 312016 by the Secretarial Auditor M/s. S Bhattbhatt & Co a Company Secretary inPractice. There are no qualifications or observations or remarks made by the SecretarialAuditor in their Report. The Report of Secretarial Audit in form of MR-3 for period ofnine months ended on March 31 2016 is attached as Annexure-2.
RELATED PARTY TRANSACTIONS
All contract(s) / arrangement(s) / transaction(s) entered into by your Company with itsrelated parties during the year under review were:
in "ordinary course of business" of the Company;
on "an arm's length basis"; and
As per the provisions of Section 188(1) of the Act read with Companies (Meetings ofBoard and its Powers) Rules 2014. Accordingly Form AOC-2 prescribed under theprovisions of Section 134(3)(h) of the Act and Rule 8 of the Companies (Accounts) Rules2014 for disclosure of details of Related Party Transactions which are "not atarm's length basis" and also which are "material & at arm's lengthbasis" is not provided as an annexure of the Directors' Report.
Further pursuant to the provisions of the Act and the SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 Board has approved and adopted a Policy onRelated Party Transactions. The said policy is available on your Company's website viz.www.ensasteel.com.
TRANSFER OF UNCLAIMED DIVIDEND TO INVESTOR EDUCATION AND PROTECTION FUND
The provisions of Section 125(2) of the Companies Act 2013 do not apply as there wasno dividend declared and paid by the Company.
PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS
The Company has not granted any loan or guarantee and does not have any investments asprescribed under section 186 of the Companies Act 2013 for the period of nine monthsended on March 31 2016.
SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALSIMPACTING THE GOING CONCERN STATUS AND COMPANY'S OPERATIONS IN FUTURE
During the period of nine months ended on March 31 2016 there were no such orderspassed by the regulators or courts or tribunals impacting the going concern status andcompany's operations in future.
ADEQUACY OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THE FINANCIAL STATEMENTS
The Company has adequate internal control procedures commensurate with its size andnature of business. The business control procedures ensure efficient use and protection ofCompany's resources and compliance with policies procedures and statutory requirements.
MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY
There have been no material changes and commitments affecting the financial positionof the Company which occurred between the end of period of nine months ended on March 312016 to which the financial statements relate and the date of this report.
NOMINATION AND REMUNERATION POLICY
The Company follows a policy on nomination and remuneration of Directors and SeniorManagement Employees. The Policy is approved by the Nomination and Remuneration Committee.The Policy of the above is attached in Annexure-3
CORPORATE SOCIAL RESPONSIBILITY
Corporate Social Responsibility (CSR) is a company's sense of responsibility towardsthe community and environment in which it operates. It is the continuing commitment bybusiness to behave ethically and contribute to economic development of the society atlarge and building capacity for sustainable livelihoods. The Company believes inconducting its business responsibly fairly and in a most transparent manner. Itcontinually seeks ways to bring about an overall positive impact on the society andenvironment where it operates and as a part of its social objectives.
This policy has been formally formulated and adopted in terms of Section 135 of theCompanies Act 2013 and Rules framed there under to undertake CSR activities.
The responsibilities of the CSR Committee include:
1. Formulating and recommending to the Board of Directors the CSR Policy and indicatingactivities to be undertaken.
2. Recommending the amount of expenditure for the CSR activities.
3. Monitoring CSR activities from time to time.
In view of the losses for the year under review your Company was not required to spendany amount towards the CSR activities as per the applicable provisions of Section 135 ofthe Companies.Act 2013. Accordingly the details of the CSR activities during the yearunder review are not provided in this Report.
The board of directors has carried out an annual evaluation of its own performanceboard committees and individual directors pursuant to the provisions of the Act and thecorporate governance requirements as prescribed by Securities and Exchange Board of India(Listing Obligations and Disclosure Requirements) Regulations 2015 ("SEBI ListingRegulations").
The performance of the committees was evaluated by the board after seeking inputs fromthe committee members on the basis of the criteria such as the composition of committeeseffectiveness of committee meetings etc.
The board and the nomination and remuneration committee reviewed the performance of theindividual directors on the basis of the criteria such as the contribution of theindividual director to the board and committee meetings like preparedness on the issues tobe discussed meaningful and constructive contribution and inputs in meetings etc. Inaddition the chairman was also evaluated on the key aspects of his role.
In a separate meeting of independent directors performance of non-independentdirectors performance of the board as a whole and performance of the chairman wasevaluated taking into account the views of non-executive directors. The same wasdiscussed in the board meeting that followed the meeting of the independent directors atwhich the performance of the board its committees and individual directors was alsodiscussed.
Corporate governance requirements under the Companies Act 2013 and as stipulatedunder the Securities and Exchange Board of India (Listing Obligations and DisclosureRequirements) Regulations 2015. A separate section on corporate governance under the SEBI(Listing Obligations and Disclosure Requirements) Regulations 2015 along with thecertificate from the Statutory Auditor confirming the compliance is in Annexed-4.
MANAGEMENT DISCUSSION & ANALYSIS
Management Discussion and Analysis for the year under review as stipulated underSecurities and Exchange Board of India (Listing Obligations and Disclosure Requirements)Regulations 2015 Regulation 34(3) read with Schedule V of the Listing Regulations ispresented in Annexure-1.
EXTRACT OF ANNUAL RETURN
The details forming part of the extract of the Annual Return in form MGT-9 is annexedherewith as Annexure-5.
PARTICULARS OF EMPLOYEES:
No employee of the Company is covered under the provisions of Section 197(12) of theCompanies Act 2013 read with rule 5(2) of the Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014 and disclosures pertaining to remuneration and otherdetails as required under Section 197(12) of the Companies Act 2013 read with Rule 5(1)of Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 is notapplicable to the Company.
Your Company has a well-defined 'Whistle Blower Policy' and established Vigil Mechanismto provide for adequate safeguard against victimisation of Directors and employees whofollow such mechanism and also make provisions for direct access to the chairperson ofAudit Committee in appropriate cases. Details of the Vigil Mechanism policy are madeavailable on the Company's website at www.ensasteel.com.
FAMILIARISATION PROGRAMME FOR INDEPENDENT DIRECTORS
All new Independent Directors (IDs) inducted into the Board are given an orientation.Presentations are made by other Directors and Senior Management giving an overview of theCompany's operations to familiarize the new IDs with the Company's business operations.The new IDs are given an orientation on our products Board constitution and proceduresmatters reserved for the Board and the Company's major risks and risk managementstrategy. The Policy on the Company's Familiarisation Programme for IDs can be accessed atwww.ensasteel.com.
DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION PROHIBITIONAND REDRESSAL) ACT 2013
The Company has in place a Policy against Sexual Harassment at work place in line withthe requirement of Sexual Harassment of Women at Workplace (Prevention Prohibition andRedressal) Act 2013. Internal Complaints Committee (ICC) has been set-up to redresscomplaints received regarding sexual harassment. All employees (permanent contractualtemporary and trainees) are covered under this Policy. No complaint received by theCommittee during the year.
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION FOREIGN EXCHANGE EARNINGS AND OUTGO
In accordance with the provisions of Section 134 (3) (m) of the Companies Act 2013 therequired information relating to conservation of energy technology absorption is notrequired to be given as Company do not have any manufacturing activities. There is noforeign exchange earnings or outgo during the year.
DIRECTORS' RESPONSIBILITY STATEMENT
Pursuance to the requirement under Section 134(3)(c) of the Companies Act 2013 yourdirectors hereby states that :
a) In the preparation of the annual accounts the applicable accounting standards havebeen followed and there are no material departures from the same;
b) The accounting policies have been selected and these have been applied consistentlyand judgments and estimates made thereon are reasonable and prudent so as to give a trueand fair view of the state of affairs of the Company for the nine months period ended onMarch 31 2016 and of the loss of the Company for the aforesaid period;
c) Proper and sufficient care has been taken for the maintenance of adequate accountingrecords in accordance with the provisions of the Companies Act 2013 for safeguarding theassets of the Company and for preventing and detecting fraud and other irregularities;
d) Annual accounts of the Company have been prepared on a 'going concern' basis;
e) Internal financial controls have been laid down and being followed by the Companyand that such internal financial controls are adequate and were operating effectively; and
f) Proper systems to ensure compliance with the provisions of all applicable laws havebeen devised.
Your Directors would like to express their sincere appreciation for the cooperation andassistance received from shareholders bankers financial institutions regulatory bodiesand other business constituents during the year under review. Your Directors also wish toplace on record their deep sense of appreciation for the commitment displayed by allexecutives officers and staff of the Company during the financial year.
| ||By Order of the Board |
| ||For ENSA Steel Industries Limited |
| ||Rajnikant Sandesara ||Jayshree Sonawala |
| ||Director ||Director |
|Mumbai : August 30 2016 ||(DIN: 01671907) ||(DIN: 01539942) |