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Gaekwar Mills Ltd.

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Gaekwar Mills Ltd. (GAEKWARMILLS) - Director Report

Company director report

To

The Members

Your Directors are pleased to present the Eighty Seventh Annual Report on the businessand operations of the Company and the audited accounts for the year ended on March312016.

FINANCIAL HIGHLIGHTS:

FY 2015-16 FY 2014-15
Loss for the Year 311.31 290.14
Add: Loss brought forward 3748.48 3458.34
Loss carried forward 4059.79 3748.48

RESERVES:

The Company does not have any Reserves.

YEAR IN REVIEW:

The Company came out of liquidation during the year by an order dated 30/06/2015 passedby the Hon. Bombay High Court. Gaekwar Mills Sangharsh Committee an one of the allegedassociation of worker have filed Notice of Motion before the Hon. Bombay High Court forrecall stroke stay of this order which has been rejected by the Hon. Bombay High Court byan order dated 28/07/2016. Nevertheless Directors were allowed to take steps to ensureimplementation of the Scheme of Compromise/Arrangement sanctioned by the Hon. Bombay HighCourt in September 2009 and subsequently modified from time to time.

The Company incurred loss of Rs. 311.306 lakhs during the year. This is essentially onaccount of interest provided on Secured Debentures of Rs. 30 crores the proceeds of whichwere used to discharge statutory and other liabilities as per the Scheme ofCompromise/Arrangement.

FUTURE PROSPECTS:

The Company is ready with its plans for developing an ultra-modern township on 60% ofthe land at Bilimora. The Company had initially submitted an application for survey of itsland to fix boundaries as per new development plan published by Government of Gujarat. Thesaid survey is completed and an application for construction of compound wall as per newboundaries has been submitted which is under consideration by Bilimora Nagarpalika. Underthe new development plan various reservations on Company’s land has been removed bythe government of Gujarat.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR ' TRIBUNALS:

Pursuant to the order dated 13/01/2015 of the Supreme Court of India passed in variousSpecial Leave Applications the pending appeal of worker has been restored by the Hon.Bombay High Court and the appeal has been admitted by the Hon. Bombay High Court on04/01/2016 without granting of any ad-interim / interim reliefs. Now the appeal is likelyto be posted for final hearing and disposal at the convenience of the Hon. Bombay HighCourt.

Other than the above matter no significant or material orders have been passed by anyregulators or courts or tribunals against the Company during the year 2015-16.

MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY:

No material changes and commitments have occurred subsequent to the close of FY 2015-16till date of this report.

DIVIDEND:

The Directors do not recommend any dividend for the financial year 2015-16 in view ofthe accumulated loss.

DEPOSITS:

Your Company has not accepted any deposits within the meaning of Section 73 of theCompanies Act 2013 and the Companies (Acceptance of Deposits) Rules 2014.

SHARE CAPITAL:

Presently the Share Capital of the Company is Rs. 20000000/- divided into 200000Equity Shares of Rs. 100/- each.

CORPORATE GOVERNANCE:

In terms of Regulation 15 of SEBI (Listing Obligations and Disclosure Requirements)Regulation 2015 compliance relating to Corporate Governance is not applicable for theListed Company having paid up equity share capital not exceeding Rs. 10 crores and networth not exceeding Rs. 25 crores on the last day of the previous financial year.

As your Company’s paid up equity share capital is not exceeding Rs. 10 crores andnet worth not exceeding Rs. 25 crores Regulation 17 to 27 and Clauses (b) to (i) ofsub-regulation (2) of regulation 46 are not applicable and do not form a part of thisAnnual Report.

MANAGEMENT DISCUSSION AND ANALYSIS:

During the year the Company has not carried any business activity hence there is norequirement to provide information.

CORPORATE SOCIAL RESPONSIBILITY INITIATIVES:

The Provision of Section 135 and Schedule VII of the Companies Act 2013 in respect toCorporate Social Responsibility (CSR) is not applicable on the Company.

SUBSIDIARY COMPANIES:

The Company does not have any subsidiary company.

PARTICULARS OF LOANS. GUARANTEES OR INVESTMENTS:

The Company has given Inter Corporate Deposit to its associate company M/s PlatinumSquare Pvt. Ltd. The details of Loans to Associate Company are provided in Note 20 of thenotes to accounts.

CONSERVATION OF ENERGY. TECHNOLOGY ABSORPTION: .

A. Conservation of Energy Technology Absorption

The particulars as required under the provisions of Section 134(3)(m) of the CompaniesAct2013 in respect of Conservation of Energy and Technology Absorption have not beenfurnished as the Company did not conduct any activities during the year under review.

B. (a) Conservation of Energy measures taken: - N.A.

(b) Technology Absorption measures: - N.A.

C. Foreign Exchange Earnings And Outgo

There were no foreign exchange earnings and outgo during the year under review.

PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES:

The Company does not have any employees drawing remuneration in excess of the limitsspecified in Section 197(12) read with Rule 5 of (Appointment and remuneration ofmanagerial Personnel) Rules 2014.

DISCLOSURES UNDER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION PROHIBITION& REDRESSAL) ACT. 2013:

The Company does not have employees more than 10 hence the declaration required underSexual Harassment of Women at Work (Prevention Prohibition and Redressal) Act does notapply.

CONTRACTS AND ARRANGEMENTS WITH RELATED PARTIES:

There were no contracts or arrangements entered into by the company in accordance withprovisions of section 188 of the Companies Act 2013.

There were no materially significant transactions with Related Parties during thefinancial year 2015-16 which were in conflict with the interest of the Company. Suitabledisclosures as required under AS-18 have been made in the Note 20 to the financialstatements.

RISK MANAGEMENT POLICY:

The Company does not have any Risk Management Policy as the elements of riskthreatening the Company's existence are very minimal and Risk Management Policy will bedeveloped as and when Company starts operations.

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY:

The Company has an adequate system of internal controls commensurate with the size andthe limited nature of its business activities.

DIRECTORS' RESPONSIBILITY STATEMENT:

To the best of our knowledge and belief and according to the information andexplanations obtained by us your Directors make the following statements in terms ofSection 134(3)(c) of the Companies Act 2013:

i. In the preparation of the annual accounts the applicable accounting standards havebeen followed.

ii. The directors have selected such accounting policies and applied them consistentlyand made judgments and estimates that were 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 or loss of the Company for the year under review.

iii. The directors have taken proper and sufficient care for 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.

iv. The directors have prepared the annual accounts on a going concern basis.

v. The directors had laid down internal financial controls to be followed by thecompany and that such internal financial controls are adequate and were operatingeffectively.

vi. The directors had devised proper system to ensure compliance with the provisions ofall applicable laws and that such system were adequate and operating effectively.

DIRECTORS:

Changes in Board Constitution-

The Directors regret to report the sad demise of Mr. Om Dutt Purohit IndependentDirector of your Company on 15.02.2016. The Board of Directors records their appreciationfor guidance received from late Mr. Om Dutt Purohit during his tenure of a Director of theCompany and Chairman of Stakeholders Relationship Committee of the Board of Directors ofthe Company since 2009.

The Company has appointed Mr. Rajen Doshi (DIN: 01558132) as an Additional Directorw.e.f 30th May 2016. The Company has received notice from a member of theCompany under Section 161 of the Companies Act 2016 in respect of his appointment asDirector alongwith the requisite deposit. Mr. Rajen Doshi is not disqualified from beingappointed as a Director as specified in terms of Section 164 of the Companies Act 2013.

In accordance with the provisions of the Companies Act 2013 Ms. Shweta Parekh (DIN:03287393) retires by rotation at the ensuing AGM and being eligible offers herself forreappointment.

Brief profile of Ms. Shweta Parekh and Mr. Rajen Doshi who are proposed forappointment as stipulated provision of SEBI (LODR) Regulation 2015 is furnished in theNotice of the ensuing AGM.

The Board of Directors of your Company recommends their re-appointment at the ensuingAGM.

MEETINGS:

Minimum four pre-scheduled Board meetings are held annually. Additional Board meetingsare convened by giving appropriate notice to address the Company's specific needs. In caseof business exigencies or urgency of matters resolutions are passed by circulation.During the year Six Board Meetings and Six Audit Committee Meetings were convened andheld. The intervening gap between the Meetings was within the period prescribed under theCompanies Act 2013.

DECLARATION BY AN INDEPENDENT DIRECTORS: '

The Company has received declaration by all Independent Director(s) that they meet thecriteria of independence as provided in sub-section (6) of Section 149 of the CompaniesAct 2013.

COMMITTEES OF BOARD ’

AUDIT COMMITTEE

The provisions of Seciton 177 of the Companies Act 2013 read with Rule 6 of theCompanies (Meetings of the Board and its Power) Rules 2014 is applicable to the Company.

The Audit Committee of the Company comprises entirely of Independent members. Thecurrent members of the committee are Mr. Ratan Karanjia Chairman Mr. Om Dutt Purohit andMr. Girish Shah. The Board has accepted all recommendations made by the Audit Committeeduring the year.

NOMINATION AND REMUNERATION COMMITTEE

The Nomination and Remuneration Committee is in existence and in accordance with theprovisions of sub section (3) of Section 178.

The Nomination and Remuneration Committee comprises of Mr. Girish Shah serves asChairman Mr. Ratan Karanjia and Ms. Shweta Parekh as other members.

STAKEHOLDERS RELATIONSHIP COMMITTEE

The provision of Section 178 of the Companies Act 2013 is applicable to the Company.The Stakeholders Relationship Committee comprises of Ms. Shweta Parekh serves as a Chairperson Mr. Ratan Karanjia and Mr. Girish Shah as other members.

BOARD EVALUATION:

The Board of Directors has made the formal annual evaluation of its own performance andthat of its committees and individual directors and found it to be satisfactory.

POLICY ON APPOINTMENT AND REMUNERATION OF DIRECTORS AND KMP AND REMUNERATION POLICY:

Policy will be developed as and when Company starts operations.

NOMINATION AND REMUNERATION COMMITTEE:

During the year no such committee meeting took place.

TERMS OF APPOINTMENT & REMUNERATION CFO &MANAGING DIRECTOR: '

During the year the company has not paid any remuneration to any of the non-executivedirectors.

KEY MANAGERIAL PERSONNEL:

The current Board of Directors comprises of Non-Executive and Independent Directorsonly. As the Company has not commenced any activity and has very limited resources it hasnot been possible to employ Managing Director Chief Financial Officer. The Board willtake steps to recruit these personnel at the time of commencement of commercial activity.

For the time being decision making is in the hands of Chairman Mr. Homi F Mehtaassisted by other directors.

In compliance with Section 203 of the Companies Act 2013 Regulation 6 of SEBI(Listing Obligations and Disclosure Requirements) Regulations 2015 The Company hasappointed Ms.

Vaishali Rathod as a Company Secretary & Compliance Officer of the Company witheffect from 9lh May 2016.

VIGIL MECHANISM:

The Company has not set up Vigil Mechanism/ Whistle Blower policy as it has notcommenced any activity and does not have any employees on its rolls.

AUDITORS:

M/s M. D. Pandya & Associates (Reg. No. 107325 W) Chartered Accountants Mumbaihold office till the conclusion of the ensuing Annual General Meeting (AGM) who wasappointed in the 85th AGM to hold office upto the conclusion of 89lhAGM.

Your company seeks ratification of appointment of the statutory auditors at the ensuingAnnual General Meeting. The Company has received letter from the statutory auditors to theeffect that the ratification of their re-appointment if made would be within theprescribed limits under Section 141(3) (g) of the Companies Act 2013 and that they arenot disqualified for appointment.

STATUTORY AUDITORS' OBSERVATIONS:

There are no qualifications reservations or adverse remarks or disclaimers made by M/sM D Pandya & Associates Statutory Auditors in their report

SECRETARIAL AUDITORS:

In terms of the provisions of section 204 of the Companies Act 2013 read with theCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014 the Board hadappointed M/s. Anish Gupta& Associates Company Secretaries Mumbai as SecretarialAuditor for conducting Secretarial Audit of your Company for the financial year 31.3.2016.The report of the Secretarial Auditor is annexed herewith as "Annexure [A]"

SECRETARIAL AUDITORS’ OBSERVATIONS& COMMENTS FROM BOARD:

REMARKS OF THE SECRETARIAL AUDITOR

(1) The company has not appointed KMP as required under section 203 of Companies Act2013 and rules made thereunder during the year 2015-16.

(2) The company has not appointed Qualified Company Secretary as compliance officer of the Company as per regulation 6 of LODR agreement. However the management hasappointed independent director as Compliance Officer of the Company which is inconsistentwith the above regulation.

(3) The company has not complied with the regulation 31(2) of LODR according to which100% shareholding of promoters shall be in Demat Form.

(4) The company has not applied for the connectivity from the CDSL/NSDL to provideDemat facilities to its shareholders as required under the regulation 31(2) of LODR.

(5) The Company is yet to approve and adopt the Policies and posting the same on thewebsite of the Company as per the various provisions of the Companies Act and ListingGuidelines.

COMMENTS FROM THE MANAGEMENT

1. As the Company has not commenced any activity and has very limited resourcesit has not been possible to employ KMP as required under section 203 of the Companies Act2013 and rules made thereunder. The Board will take steps to recruit these personnel atthe time of commencement of commercial activity.

2. In the absence of any staff the Company had no choice but to assign duties ofCompliance Officer to an Independent Director. However Company has appointed ComplianceOfficer w.e.f. 9.05.2016.

3. Directors has pursue this matter once again with the depositories and the Companyhave applied for dematerialization of 100% shareholding of Promoters and also applied toprovide Demat facilities to its shareholders with NSDL..

EXTRACT OF ANNUAL RETURN:

In terms of the provisions of Section 92 (3) of the Act read with the Companies(Management and Administration) Rules 2014 an extract of the Annual Return of yourCompany for the financial year ended 31siMarch 2016 is given in Annexure [B]

OTHER DISCLOSURES:

• There were no material changes and commitments affecting the financial positionof your Company between end of the financial year and the date of this report.

• Your Company has not issued any shares with differential voting.

• There was no revision in the financial statements.

• Your Company has not issued any sweat equity shares.

• During the year your Company has not received any complaints under the SexualHarassment of Women at Workplace (Prevention Prohibition and Redressal) Act 2013.

PREVENTION OF INSIDER TRADING:

The Company has ensured the compliance of Prevention of Insider Trading with a view toregulate trading in securities by the Directors and designated employees of the Company.The Company is in process to adopt the Code of Conduct for prevention of Insider Trading.

APPRECIATION:

Your Company and its Directors wish to extend their sincerest thanks to the Members ofthe Company and other interested parties at all levels for their continuous co-operationand assistance. -

By Order of the Board of Directors
ForGaekwar Mills Limited
Shweta Parekh RatanKaranjia
Place: Mumbai Director Director
Date: 12.8.2016 (DIN No: 03287393) (DIN No: 00033108)