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Euro Ceramics Ltd.

BSE: 532823 Sector: Consumer
NSE: EUROCERA ISIN Code: INE649H01011
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VOLUME 17500
52-Week high 15.08
52-Week low 5.52
P/E 11.86
Mkt Cap.(Rs cr) 24
Buy Price 0.00
Buy Qty 0.00
Sell Price 7.00
Sell Qty 200.00
OPEN 7.20
CLOSE 6.98
VOLUME 17500
52-Week high 15.08
52-Week low 5.52
P/E 11.86
Mkt Cap.(Rs cr) 24
Buy Price 0.00
Buy Qty 0.00
Sell Price 7.00
Sell Qty 200.00

Euro Ceramics Ltd. (EUROCERA) - Director Report

Company director report

To

The Members

Euro Ceramics Limited

Your Directors hereby presents the Fourteenth Annual Report together with the AuditedFinancial Statements of the Company for the financial year ended March 31 2016.

1. FINANCIAL HIGHLIGHTS:

(Rs. in Lakhs)

Particulars Year Ended March 31 2016 Year Ended March 31 2015
Revenue from operations 5597.66 4971.09
Other Income 168.56 271.09
Total Income 5766.22 5242.18
Less: Total Expenditure 5745.01 4940.93
Earnings Before Interest 21.21 301.25
Depreciation and Tax
Less : Interest and other finance 76.30 69.95
Less: Depreciation 2696.12 2882.80
Profit/(Loss) Before Tax and Extraordinary Item (2751.22) (2651.50)
Less: Extraordinary Item - 3552.17
Profit/(Loss) Before Tax (2751.22) (6203.67)
Less: Deferred Tax (1523.92) -
Net Profit/(Loss) After (1227.30) (6203.67)
Tax
Add: Balance Brought forward from the previous year (25110.66) (18906.99)
Balance Carried forward to Balance Sheet (26337.96) (25110.66)

2. FINANCIAL REVIEW:

Turnover of the Company during the year is increased by Rs. 626.57 Lakhs compared toprevious year achieving a growth of 12.60%.

The Loss before tax for the year is increased by Rs. 99.71 Lakhs compared to previousyear due to fixed cost burden and low margins in the business.

The brief financial highlights are given above and discussed in detail in ManagementDiscussion and Analysis as part of this report.

3. OPERATIONAL REVIEW:

a. Tiles Division Aluminium Extruded Section and Realty Division:

The Company’s vitrified tiles plant wall tiles plant and Aluminium ExtrudedSections plants were continued to be in-operative during the year under review due toworking capital shortages and did not generated any revenue except for sale of old stockin hand.

There was no business in the Realty Division during the year.

b. Calcareous Tiles/Marble Division :

Marble division contributed around 43% in the total revenue. The operating capacityutilisation was around 11%. Due to working capital shortages utilisation in this divisionwas low.

c. Sanitaryware Divisions:

Sanitaryware Division has performed better compared to previous year contributingturnover of Rs. 3081.12 Lakhs during the year higher by 25.34%. The capacity utilisationwas around 53% recording an improvement of around 5% over previous year.

4. SHARE CAPITAL:

There was no change in share capital of the Company during the year 2015-16.

5. DIVIDEND:

In view of losses during the year under review your Directors do not recommend anydividend for the financial year 2015-16.

6. PUBLIC DEPOSITS:

During the year under review the Company has not accepted any deposits within themeaning of Section 73 and 76 of the Companies Act 2013 read with Companies (Acceptance ofDeposits) Rules 2014.

7. LISTING OF SHARES:

The Equity shares of the Company are listed on National Stock Exchange of India Limited(NSE) and BSE Limited (BSE). The Listing fees for the year 2015-16 have already been paidto BSE and NSE. During the year under review the Company received Listing approval of5159705 Equity Shares of Rs. 10/- each arising on conversion of Compulsorily ConvertibleDebentures issued on Preferential basis pursuant to CDR scheme approved by the CDR Cell.

8. REFERENCE TO BIFR:

The Company on the basis of the audited accounts for the financial year ended as onMarch 31 2013 and being mandatory filed the reference U/s 15(1) of Sick IndustrialCompanies (Special Provisions) Act 1985 before the Hon’ble Board for Industrial& Financial Reconstruction (BIFR). The above reference has duly been registered by theRegistrar of Hon’ble BIFR and hearings of which are in the process for determinationof sickness of the Company

9. ACTION AGAINST THE COMPANY BY THE BANKS UNDER SECURITIZATION AND RECONSTRUCTION OFFINANCIAL ASSETS AND ENFORCEMENT OF SECURITY INTEREST ACT 2002 (SARFAESI) AND THERECOVERY OF DEBTS DUE TO THE BANKS AND FINANCIAL INSTITUTION ACT 1993.

The Company has been incurring losses since F.Y.2011-12 which has resulted in erosionof its net worth and depletion in its working capital. Eventually there were defaults inthe repayment of obligations to banks and the relevant loan accounts

- Term Loans Cash Credits and other Non-Fund Based Credits have been classified asNon Performing Assets by the Lenders. Consequently the Lenders have called-off theiradvances and issued notice to the Company for recovery of their dues under Section 19 ofRecovery of Debts (DRT) and under Section 13(2) of the Securitization & Reconstructionof Financial Assets & Enforcement of Security (Second) Interest (SARFAESI) Act 2002.Some of the lenders have taken symbolic possession of the secured assets of the Companyunder Section 13(4) of the SARFAESI Act 2002 and rules thereunder. However no order hasbeen passed against the Company in the said matters.

Your Company is in the process of challenging the legality and validity of thesenotices and action of lenders and is in consultation with its legal advisors to takeappropriate steps as may be advised by the legal advisors to protect your Company’sinterests.

10. EXTRACT OF ANNUAL RETURN:

An extract of Annual Return in Form MGT 9 is appended to this Report as Annexure I.

11. HOLDING SUBSIDIARY JOINT VENTURE & ASSOCIATE COMPANY:

Euro Merchandise (India) Limited is a Wholly-owned Subsidiary of the Company. TheCompany does not have any Holding Jont Venture or Associate Company. Pursuant toprovisions of Section 129(3) of the Companies Act 2013 a statement containing salientfeatures of the financial statements of the Wholly-owned subsidiary in Form AOC-1 isenclosed as Annexure to the Financial Statements provided in this Annual Report.

12. DIRECTORS AND KEY MANAGERIAL PERSONNEL:

Mr. Mahendra Vrajlal Modi Independent Director expired on January 31 2016 andaccordingly ceased to be a Director of the Company. The Board expresses its appreciationfor his valuable guidance as an Independent Director of the Company.

The tenure of Mr. Nenshi L Shah as Managing Director of the Company expired on November30 2015 and is not eligible for being re-appointed as such under Section 164(2)(b) of theCompanies Act 2013. However he continued as Non-Executive Director of the Company. Mr.Nenshi L Shah Chairman and Non-Executive Director of the Company resigned from theDirectorship with effect from February 12 2016 and was appointed as Chief ExecutiveOfficer (CEO) of the Company with effect from February 22 2016 pursuant to the provisionsof Section 203 of the Companies Act 2013.

Mr. Pratik Kumar Shah Whole-time Director of the Company was appointed as the Chairmanof the Company with effect from February 12 2016.

The Company has received declaration from all the Independent Directors of the Companyconfirming that they meet the criteria of independence as prescribed both under Section149(6) of the Companies Act 2013 and Clause 49 of erstwhile Listing Agreement read withRegulation 16(1) (b) of SEBI (Listing Obligations & Disclousre Requirements)Regulations 2015 (herein after referred as "Listing Regulations")

13. DIRECTORS’ RESPONSIBILITY STATEMENT:

Pursuant to the provisions of Section 134(3)(c) of the Companies Act 2013 yourDirectors confirm that:

a. in the preparation of the annual accounts the applicable accounting standards havebeen followed along with proper explanation relating to material departures if any;

b. they have selected such accounting policies and applied them consistently and madejudgments and estimates that are reasonable and prudent so as to give a true and fair viewof the state of affairs of the company at the end of the financial year March 31 2016 andof the loss of the company for that period;

c. they have 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. they have prepared the annual accounts on a going concern basis;

e. they have laid down internal financial controls to be followed by the company andthat such internal financial controls are adequate and were operating effectively; and

f. they have devised proper systems to ensure compliance with the provisions of allapplicable laws and that such systems were adequate and operating effectively.

14. MEETINGS OF THE BOARD:

During the year under review the Board met 4 (four) times details of which are givenin the Report on Corporate Governance. The intervening gap between the two consecutivemeetings was within the period prescribed under the Companies Act 2013.

15. PERFORMANCE EVALUATION:

Pursuant to the provisions of the Companies Act 2013 and Regulation 17 of the ListingRegulations a formal annual evaluation needs to be made by the Board of its ownperformance and that of its Committees and individual Directors. Schedule IV of theCompanies Act 2013 states that the performance evaluation of the independent directorsshall be done by the entire Board of Directors excluding the Director being evaluated. TheBoard works with the Nomination and Remuneration Committee to lay down the evaluationcriteria. The evaluation framework for assessing the performance of Directors comprises ofthe following key areas:

i. Attendance at the Meetings of the Board and Committee;

ii. Quality of contribution to Board deliberations;

iii. Strategic perspectives or inputs regarding future growth of Company and itsperformance;

iv. Providing perspectives and feedback going beyond information provided by themanagement.

v. Ability to contribute to and monitor corporate governance practices

During the year under review the Nomination and Remuneration Committee reviewed theperformance of all the executive and non-executive directors. The Board has carried out anevaluation of its own performance the directors individually as well as the evaluation ofthe working of its Audit Committee Nomination and Remuneration Committee andStakeholders’ Relationship Committee of the Company. The Board has devisedquestionnaire to evaluate the performances of each of Executive Non-Executive andIndependent Directors. Such questions are prepared considering the business of the Companyand the expectations that the Board have from each of the Directors.

A separate meeting of the Independent Directors was held for evaluation of performanceof non-independent Directors performance of the Board as a whole and performance of theChairman of the Company.

16. COMMITTEES OF THE BOARD:

Subsequent to the changes in the Board of Directors during the year under review theBoard re-constituted some of its Committees in accordance with the Companies Act 2013 andListing Regulations. There are currently three Committees of the Board as follows:

a. Audit Committee

b. Stakeholders’ Relationship Committee

c. Nomination and Remuneration Committee

Details of all the Committees along with their charters composition and meetings heldduring the year are provided in the "Report on Corporate Governance" whichforms part of this Annual Report.

17. AUDIT COMMITTEE AND ITS COMPOSITION:

The Audit Committee of the Company reviews the reports to be submitted with the Boardof Directors with respect to auditing and accounting matters. It also supervises theCompany’s internal control and financial reporting process.

The Audit Committee is duly constituted as per the provisions of Section 177 of theCompanies Act 2013 and Regulation 18 of the Listing Regulations. As on March 31 2016the Audit Committee comprised of Mr. Karan Rajput Mr. Amit Nandu and Mrs. Usha KotianIndependent Directors and Mr. Pratik Shah Chairman and Whole Time Director of theCompany.

Mr. Karan Rajput Independent Director is the Chairman of Audit Committee of theCompany.

The Compliance Officer of the Company act as Secretary to the Committee.

18. STATUTORY AUDITORS:

M/s. Deepak Maru & Co. Chartered Accountants Mumbai (FRN: 115678W) the StatutoryAuditors of the Company holds office as such upto the conclusion of the ensuing AnnualGeneral Meeting and are eligible for re-appointment. The Company has received a letterfrom them regarding their willingness to continue as Statutory Auditors of the Company.The Company has also received a certificate from them to the effect that theirreappointment if made would be in compliance with the conditions as prescribed underSection 139 of the Companies Act 2013 and they satisfy the criteria as provided underSection 141 of the Act.

Your Directors recommend the re-appointment of M/s. Deepak Maru & Co. CharteredAccountants Mumbai as the Statutory Auditors of the Company to hold office from theconclusion of the ensuing

Annual General Meeting until the conclusion of next Annual General Meeting to auditfinancial statements of the Company for the financial year 2016-17.

19. AUDITORS’ REMARKS:

With reference to the observations made by the Statutory Auditors in their Standaloneand Consolidated Report on the Audited Financial Statements for the year ended March 312016 your Directors hereby reply as under:

I. The financial statement have been prepared on a "going concern" basisinspite the fact that the Company’s financial facilities/ arrangements have expiredand the same are overdue for repayment and the networth of the Company fully eroded andthe lenders and creditors have initiated legal proceedings against the Company forrecovery.

Your Directors hereby state that the Company is operational and Manufacturing Marbleand Sanitaryware Products and employed more than 200 manpower. The Company is also makingserious efforts in negotiating with the banks and resolving the issues with banks. Themanagement has taken and been taking all diligent steps under legal advice to defend theCompany in all the litigation. Considering the ample opportunities in the market andgrowth drivers for the industry per say your Directors are optimistic about theturnaround of the Company with the infusion of the long term funds and with support of thelenders. The Company can derive a comprehensive package under BIFR for the secured andunsecured lenders with potential future earning plans for resolution of its debts.

II. The Company has not provided for interest on financing facilities amounting to Rs.10250.96 Lakhs (as per audited standalone accounts) and Rs. 10674.15 Lakhs (as peraudited consolidated accounts) for the year ending March 31 2016. Had the same beenprovided the loss for the year ending March 31 2016 would have increased by Rs.10250.96 Lakhs (as per audited standalone accounts) and Rs. 10674.15 Lakhs (as peraudited consolidated accounts). The corresponding liabilities would also have increased byRs. 10250.96 Lakhs (as per audited standalone accounts) and Rs. 10674.15 Lakhs (as peraudited consolidated accounts) as at March 31 2016.

The Company on the basis of registration filed u/s. 15(1) of the Sick IndustrialCompanies (Special Provisions) Act 1985 before the Hon’ble Board for Industrial& Financial Reconstruction and the hearings for which are in process fordetermination of sickness of the Company and on the basis of negotiation with the lendersfor reduction in interest rephasement in terms of borrowings etc. has not provided forinterest to the tune of Rs. 10250.96 Lakhs (as per audited standalone accounts) and Rs.10674.15 Lakhs (as per audited consolidated accounts) (calculated based on last sanctionletters in hand) on financing facilities for the year ending March 31 2016.

III. The Company has not provided for impairment or diminishing value of itsassets/investment as per ‘Accounting Standard 28 – Accounting for Impairment ofAssets’ as notified under the Companies (Accounting Standards) Rules 2006 read withthe General Circular 15/2013 dated September 13 2013 of the Ministry of Corporate Affairsin respect of Section 133 of the Companies Act 2013. The effect of such Impairment ordiminishing value has not been quantified by the management and hence the same is notascertainable.

The Company has made the provisions for diminution in the value of its investments/assets wherever required. Management has a policy to maintain the assets and keep them inworking condition so that its value does not get affected in long run. The management isoptimistic about realizing the value of its Assets / Investments nearest to its carryingvalue and there is no further diminution in the value of its assets/investment other thandepreciation / amortization and provided for.

IV. That financial statement are subject to receipt of confirmation of balances fromall of the debtors loans & advances investments banks sundry creditors and otherliabilities.

Pending receipt of confirmation of these balances and consequential reconciliations /adjustments if any the resultant impact on the financial statements is notascertainable.

Your management hereby state that the Company is in the process of obtaining theconfirmations from debtors creditors lenders and loans advances in routine course ofbusiness and have obtained from some of them. The reconciliations are made and the effectshave been given in the books of accounts wherever required.

V. The non-ascertainment of complete particulars of dues to Micro Small and Mediumenterprises if any under MSMED Act 2006 and provisions towards interest if any is notascertained at this stage which is not in conformity with para14 of Accounting Standard29-‘Provision Contingent Liabilities and Contingent Assets’.

The Company is in the process of identifying the creditors which are Micro Small andMedium Enterprises under MSMED Act.

VI. There has been delay in transferring unclaimed dividend amounting to Rs. 0.37 Lakhspertaining to financial year 2007-08 into the Investor Education and Protection Fund bythe Company during the year ended March 31 2016.

Your management would like to state that the delay in transferring the amounts to theInvestor Education and Protection Fund was unintentional and due to some technical error.

VII. In respect of loans secured or unsecured granted by the Company to Companiesfirms or other parties covered in the register maintained under Section 189 of the Actthere are no stipulations made regarding repayment of principal amount and interest. Hencewe are unable to comment as to regularity of repayments of principal and interest amount.

Your directors hereby state that the Loans and Advances are given in the normal courseof business to a firm where your Company is a partner with majority share.

VIII. The Company has not appropriated within the prescribed period of 365 days fromthe date of receipt the amount received by it for the supply of goods / provision ofservices that were received in normal course of and for the purpose of its businessamounting to Rs. 135.06 Lakhs (as per audited standalone accounts) and Rs. 167.81 Lakhs(as per audited consolidated accounts). The said amount tantamount to acceptance ofdeposit within the meaning of Sec 73 to sec.76 of the Companies Act 2013 and the rulesframed there under. The Company has not complied with Company’s Acceptance ofDeposits Rule as provided in sec.73 to 76 of the Companies Act 2013 to that extent.

The management hereby state that the advances are received in the normal course ofbusiness and the appropriation will be done in the next financial year.

IX. The Company has given the guarantee for loans taken by its subsidiary from bank.The terms and conditions of the same are not prejudicial to the interest of the Company.The said subsidiary has been continuously incurring losses and its net worth has beenfully eroded and there is substantial doubt whether the said subsidiary would be able torepay its liabilities or realize its assets.

Your directors hereby state that the management of the subsidiary Company is hopeful ofreviving its business with the changing economic scenario and is negotiating with thelender for amicable settlement of its dues.

20. INTERNAL AUDIT:

The Company has appointed M/s. J H Ghumara & Co. Chartered Accountants Mumbai asits Internal Auditor for the financial year 2015-16. The Internal Auditors have giventheir report on quarterly basis to the Audit Committee.

Based on the report of internal audit function the Board takes corrective action inthe specific areas observed and thereby strengthen the controls.

21. SECRETARIAL AUDIT REPORT:

Pursuant to the provisions of Section 204 of the Companies Act 2013read with Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 the Board hadappointed M/s. Manish Ghia & Associates Company Secretaries Mumbai as theSecretarial Auditors to conduct the Secretarial Audit of the Company for the FinancialYear 2015-16. The Report of the Secretarial Auditor is enclosed as Annexure II which formspart of this Report.

With regard to observations made by the Secretarial Auditors’ in their Reportyour Directors hereby state that:

a) as required under section 203 of the Act the company is yet to appoint a CompanySecretary;

The Company is in process of appointment of Whole time Company Secretary.

b) although the loans/ advances extended by the company under Section 186 of the Actpertains to the previous financial years but which are still continuing in the periodunder review are interest free in nature and there are no stipulation as to itsrepayment;

Your directors hereby state that the Loans and Advances are given in the normal courseof business to a firm where your Company is a partner with majority share.

c) the company has not complied with the provisions of Section 133 of the Actpertaining to Accounting Standards (AS-28) w.r.t Accounting for Impairment of Assets andAccounting Standards (AS-29) Provisions Contingent Liabilities and Contingent Assets thebrief particulars of which are stated in the Statutory Auditor’s Report in"point no 3 & 5" under the heading

Basis for Qualified opinion;

The Company has made the provisions for diminution in the value of its investments/assets wherever required in compliance of AS-28. Management has a policy to maintain theassets and keep them in working condition so that its value does not get affected in longrun. The management is optimistic about realizing the value of its Assets / Investmentsnearest to its carrying value and there is no further diminution in the value of itsassets/investment other than depreciation / amortization and provided for.

The Company is in the process of identifying the creditors which are Micro Small andMedium Enterprises under MSMED Act. The provision for interest to such creditors is notascertainable at this stage.

d) the company has not complied with the provisions of Sections 73 to 76 of the Actread with Companies (Acceptance of Deposits) Rules 2014 as the amount received by it forthe supply of goods/ provision of services that were received in the normal course of andfor the purpose of it’s business amounting to Rs. 135.06 Lakhs were not appropriatedwithin the prescribed period of 365 days from the date of such receipt and accordingly thesame qualifies as a deposit and the company has not complied with the necessaryrequirements for such acceptance;

Your management hereby state that the advances are received in the normal course ofbusiness and the appropriation will be done in the next financial year.

e) in respect of outstanding deposits as at March 31 2015 the company was required tofile Form DPT-3 latest by June 30 2015 which has not been filed;

f) in respect of unpaid/unclaimed amount of dividend/interest/matured deposits/application money etc. the company is yet to file Form 5INV relevant to the financialyear ended March 31 2015 and also to upload the same on its website; the said Form 5INVis required to be filed within 90 days from the date of Annual General Meeting which washeld on September 29 2015;

g) there has been a delay of 10 days in transferring the unclaimed dividend amount ofRs. 0.37 Lakh pertaining to financial year 2007-08 into Investor Education and ProtectionFund;

Your management would like to state that the delay in transferring the amounts to theInvestor Education and Protection Fund was unintentional and due to some technical error.

h) non filing of form DIR-9 in respect of default in payment of interest/repayment ofdeposit relating to financial year 2014-15; on account of the said default the directorsof the company at the time of default and continuing on the board on date have incurreddisqualification in terms of the provisions of Sec 164(2) of the Act;

The Company is a Sick Company within the meaning of Sick Industrial Companies (SpecialProvisions) Act 1985 and has filed a reference under Section 15 (1) of the said Actbefore the Hon’ble Board for Industrial and Financial Construction based on itsAudited Financials for the year ended March 31 2013. The Company’s financialposition was under stress and consequently defaulted on its obligation to secured lendersand all the lenders have classified the Company’s account as Non Performing Assets(NPA). Thus the Company was not in a position to repay the unsecured deposits as requiredunder the provision of Companies Act 2013 and hence the Company has filed an applicationwith the Company Law Board on March 31 2015 for granting extension of time for repayment.The said application is pending before the Company Law Board.

Further the hearings with the BIFR are under process for determination of sickness ofthe Company and final scheme of arrangement is yet to be prepared.

In the view of the above the management is of the opinion that the default inrepayment of the deposits are regularised and none of the Directors are disqualified underSection 164 (2) (b) of the Companies Act 2013. Hence filing of Form DIR 9 is notapplicable.

i) form DIR-12 filed beyond the stipulated time limit of 30 days specified undersection 170 of the Act in respect of following:

- cessation of Mr. Mahendra Modi from the directorship on account of demise; and

- change in designation of Mr. Nenshi Shah to Director on determination of his tenureas Managing Director;

j) Mr. Pratik Shah Whole Time Director of the company who retired by rotation at theAnnual General Meeting held on September 29 2015 was ineligible to seek reappointment byvirtue of section 164(2) of the Act and accordingly should have ceased to be director fromthe date of the Annual General Meeting and such cessation would also entail filing of FormDIR-12;

k) the company is yet to file the Annual Return on Foreign Liabilities and Assets asrequired under Foreign Exchange Management Act1999 for the Financial year 2014-15 whichwas to be filed latest by July 15 2015

l) company has not complied with the following clauses/Regulation of Listing Agreementand LODR:

i) due to the observation mentioned in the sub-para "j" above the Companywas not able to comply with Regulation 17(1) of LODR of having at least one executivedirector on the Board;

ii) due to the observation mentioned in the sub-para "j" above the CorporateGovernance Report submitted to the Stock Exchanges for the Quarter ended December 2015does not reflect the correct position of the composition of the board w.r.t. executivedirector.

With regard to paras(j) and (l) your management is of the view that as explained inresponse to para (h) above the default in repayment of the deposits are regularised andnone of the Directors are disqualified and can continue as a Whole-time Director and hencefiling of Form DIR 12 is not applicable. Accordingly the non-compliance as mentionedunder para (l) shall also be not applicable.

Further the Company is in process of obtaining a legal opinion to confirm whether theDirectors are disqualified under Section 164(2)(b) of the Companies Act 2013.

Your management would like to state that non-compliance in regards to para no. (e)(f) (i) and (k) are unintentional and in the absence of Whole time Company Secretary thecompliances were missed out inadvertently.

22. VIGIL MECHANISM POLICY:

The Company has adopted a Vigil Mechanism / Whistle Blower Policy to deal with instanceof fraud and mismanagement if any in accordance with Section 177 of the Companies Act2013. The mechanism also provides for adequate safeguards against victimization ofdirectors and employees who avail of the mechanism and also provide for direct access tothe Chairman of the Audit Committee in the exceptional cases. The details of the VigilMechanism Policy is explained in the Report on Corporate Governance and also posted on thewebsite of the Company i.e. www.eurovitrified.com. We affirm that during thefinancial year 2015-16 no employee or Director was denied access to the Audit Committee.

23. REMUNERATION POLICY:

The Board has on the recommendation of the Nomination and Remuneration Committeeframed a policy for selection and appointment of Directors Senior Management anddetermination of salary of Directors Senior Management Personnel and any other employeesof the Company. The Remuneration Policy is stated in the Report on Corporate Governance.

24. PARTICULARS OF REMUNERATION:

Disclosure with respect to the ratio of remuneration of each Director to the medianemployees’ remuneration as required under Section 197 of the Companies Act 2013 readwith Rule 5(1) of Companies (Appointment and Remuneration of Managerial Personnel) Rules2014 is appended to this Report as Annexure III.

During the year under review no employee was in receipt of remuneration exceeding thelimits as prescribed under provisions of Section 197 of the Companies Act 2013 and Rule5(2) and 5(3) of Companies (Appointment and Remuneration of Managerial Personnel) Rules2014.

25. INTERNAL FINANCIAL CONTROL:

The Company has adopted a formal Internal Financial Control policy during the financialyear under review. The Board evaluates the efficancy and adequacy of the financial controlsystem in the Company its compliance with the operation system accounting procedures atall level and strives to maintain the standard in Internal Financial Control.

26. RISKS AND AREAS OF CONCERN:

The Company has laid down a well-defined Risk Management Policy covering the riskmapping risk analysis risk exposure potential impact and risk mitigation process. Adetailed exercise is being carried out to identify evaluate manage and monitor bothbusiness and non-business risk. The Board periodically reviews the risk and suggest stepsto be taken to control and mitigate the same through a properly defined framework.regarding

27. PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES:

All Related Party Transactions entered during the year were in the ordinary course ofbusiness and on arm’s length basis. No material related party transactions wereentered during the year by your Company. The policy on Related Party Transactions asapproved by the Board is uploaded on the Company’s website at www.eurovitrified.com.Accordingly the disclosure of related party transactions as required under Section 134(3)of the Companies Act 2013 in Form AOC-2 is not applicable.

28. PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS:

The details of loans guarantees or investments made by your Company under Section 186of the Companies Act 2013 during the financial year 2015-16 are given in the Notes toFinancial Statements provided in this Annual Report.

29. DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS ORTRIBUNALS IMPACTING THE GOING CONCERN STATUS AND COMPANY’S OPERATIONS IN FUTURE:

There was no significant by any regulator or court or tribunal which impacts the goingconcern status of the Company or will have bearing on company’s operations in future.

30. REPORT ON CORPORATE GOVERNANCE:

Pursuant to the provisions of Regulation 34 read with Schedule V of the ListingRegulations the following have been made a part of the Annual Report:

a. Management Discussion and Analysis

b. Report on Corporate Governance.

c. Certificate regarding compliance of conditions of Corporate Governance

31. INFORMATION UNDER THE SEXUAL HARRASSMENT OF WOMEN AT WORKPLACE (PREVENTIONPROHIBITION AND REDRESSAL) ACT 2013:

The Company has zero tolerance for sexual harassment at workplace and adopted a Policyon prevention prohibition and redressal of sexual harassment at workplace in line withthe provisions of the Sexual Harassment of Women at Workplace (Prevention Prohibition andRedressal) Act 2013 and the Rules thereunder. There was no complaint on sexual harassmentreported during the year under review.

32. PARTICULARS OF CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION FOREIGN EXCHANGEEARNINGS AND OUTGO:

Details regarding Conservation of Energy

Technology Absorption Foreign Exchange Earnings and Outgo are given in Annexure IV.

33. APPRECIATION:

Your Directors acknowledges with gratitude and wish to place on record their deepappreciation of continued support and co-operation received by the Company from thevarious Government authorities Shareholders Bankers Lenders Business AssociatesDealers Customers Financial Institutions and Investors during the year.

Your Directors place on record their deep appreciation of the dedication and commitmentof your Company’s employees at all levels and look forward to their continued supportin the future as well.

By Order of the Board of Directors
Pratik K. Shah Usha Kotian
Chairman & Whole time Director Director
DIN 01049516 DIN 07140529
Place: Mumbai
Date: August 16 2016