The Members of
Garg Furnace Limited
The Directors of your company have pleasure in presenting the 42nd Annual Report on theaffair of the company together with the Audited Accounts for the year ending 31st March2015.
| ||(Rupees in Lacs) |
| ||2014-15 ||2013-14 |
|Operating Income ||15994.92 ||16483.36 |
|Profit before depreciation Interest & tax ||912.64 ||1023.09 |
|Interest & Financial Expenses ||767.73 ||758.58 |
|Profit before depreciation & tax ||144.92 ||264.51 |
|Depreciation ||114.73 ||132.27 |
|Profit before tax ||30.19 ||132.24 |
|Provision for tax -Current Tax ||5.94 ||25.31 |
|-Deferred Tax Asset ||23.53 ||13.24 |
|Less : Mat Credit Entitlement ||5.75 || |
|Profit after Tax ||53.53 ||93.69 |
|Prior year Tax adjustments/ ||-56.57 ||0 |
|Depreciation to Reverse as per Schedule II || || |
|Balance brought forward ||229.93 ||156.24 |
| ||226.89 ||249.93 |
|APPROPRIATIONS || || |
|Transfer to General Reserve ||0 ||20 |
|Balance carried over to Balance Sheet ||226.89 ||229.93 |
| ||226.89 ||249.93 |
The Board of Directors do not recommend payment of dividend for the year under review.
There was no public issue rights issue bonus issue or preferential issue etc. duringthe year. The Company has not issued shares with differential voting rights sweat equityshares nor has it granted any stock options.
Detailed information on the operations of the different business lines of the Companyand details on the state of affairs of the Company are covered in the ManagementDiscussion and Analysis Report
EXTRACT OF ANNUAL RETURN
The extract of annual return as provided under sub-section (3) of section 92 of theCompanies Act 2013 in the prescribed Form MGT-9 is annexed to this Report.
NUMBER OF MEETINGS OF THE BOARD
There were 5 meetings of the Board held during the year. Detailed information is givenin the Corporate Governance Report.
DIRECTORS RESPONSIBILITY STATEMENT
As required under clause (c) of sub-section (3) of section 134 of Companies Act 2013directors to the best of their knowledge and belief state 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 Companies Act 2013 forsafeguarding the assets of the Company and for preventing and detecting fraud and otherirregularities;
(d) the directors had prepared the annual accounts on a going concern basis; and
(e) the directors had laid down internal financial controls to be followed by theCompany and that such internal financial controls are adequate and were operatingeffectively; and
(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.
DECLARATION BY INDEPENDENT DIRECTORS
The independent directors have submitted the Declaration of Independence as requiredpursuant to section 149(7) of the Companies Act 2013 stating that they meet the criteriaof independence as provided in sub-section (6).
DIRECTORS REMUNERATION POLICY AND CRITERIA FOR MATTERS UNDER SECTION 178
Information regarding Directors Remuneration Policy and criteria for determiningqualifications positive attributes independence of a director and other matters providedunder sub-section (3) of section 178 are provided in the Corporate Governance Report.
PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS
Information regarding loans guarantees and investments covered under the provisions ofsection 186 of the Companies Act 2013 are detailed in the Financial Statements.
RELATED PARTY TRANSACTIONS
There were no related party transactions (RPTs) entered into by the Company during thefinancial year which attracted the provisions of section 188 of Companies Act 2013.There being no material related party transactions as defined under clause 49of the Listing Agreement there are no details to be disclosed in Form AOC-2 in thatregard.
During the year 2014-15 pursuant to section 177 of the Companies Act 2013 and clause49 of the Listing Agreement all RPTs were placed before Audit Committee for itsprior/omnibus approval.
MATERIAL CHANGES AND COMMITMENTS
There have been no material changes and commitments affecting the financial positionof the Company which have occurred between the end of the financial year of the Companyand the date of this Report.
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO.
The information relating to Conservation of Energy Technology Absorption and ForeignExchange Earning and Outgo as required under Section 134 (3)(m) of The Companies Act 2013read with Rule 5 of Companies (Accounts) Rules 2014 is annexed and forms part of thisreport.
RISK MANAGEMENT POLICY
Information on the development and implementation of a Risk Management Policy for theCompany including identification therein of elements of risk which in the opinion of theBoard may threaten the existence of the Company is given in the Corporate GovernanceReport.
CORPORATE SOCIAL RESPONSIBILITY
Provision of section 135 of the Companies Act 2013 are not applicable to Company
FORMAL ANNUAL EVALUATION OF THE RFORMANCE OF BOARD ITS COMMITTEES AND DIRECTORS
Information on the manner in which formal annual evaluation has been made by the Boardof its own performance and that of its Committees and individual directors is given in theCorporate Governance Report.
SUBSIDIARIES AND JOINT VENTURE
Company has no subsidiary associate and Company in Joint Venture
DIRECTORS AND KEY MANAGERIAL PERSONNEL
a) In light of the provisions of the Companies Act 2013 Mrs. Vaneera Garg WomanDirector retires from the Board by rotation this year and being eligible offers herselffor re-appointment. The information as required to be disclosed under clause 49 of theListing Agreement in case of re-appointment of the director is provided in the Notice ofthe ensuing annual general meeting.
b). Sh. Amit Gupta was appointed as an additional director in the category ofnon-executive independent director of the Company in the meeting of the Board held on 15November 2014. Pursuant to Section 149 and other applicable provisions of the CompaniesAct 2013 your Directors are seeking appointment of). Sh. Amit Gupta as regular &Independent Directors for the terms given in the Notice of the 42nd Annual GeneralMeeting. Details of the proposal for the appointment of above Independent Directors arementioned in the Explanatory Statement under Section 102 of the Companies Act 2013 of theNotice of the 42nd Annual General Meeting.
c) Pursuant to section 203 of the Companies Act 2013 the Company has appointed Sh.Daksh Garg as Chief Financial Officer (CFO) of the Company with effect from 1st September2014
d) The Company already has Toshak Garg Managing Director as the Key ManagerialPersonnel of the Company. Ms. Gursimran Kaur Sethi Company Secretary Key ManagerialPersonnel of the Company has resigned from her post as Company Secretary of the Company.Management in process to fill the vacancy by a suitable Candidate.
e). Mr. Yogi Raj Aggarwal and Mr. Vivek Kaushal the directors of company and member ofcommittees thereof has resigned from the board w.e.f 16th OCT 2014 & 28th OCT 2014respectively due to their preoccupancy in their business . The Directors would like toplace on record their sincere appreciation for there commitment and contribution made byhim during his tenure on the Board.
SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS
During the year under review there were no significant and material orders passed bythe regulators or courts or tribunals which may impact the going concern status of theCompany and its operations in future.
ADEQUACY OF INTERNAL FINANCIAL CONTROLS
Internal financial controls with reference to the financial statements were adequateand Operating effectively.
PRESENTATION OF FINANCIAL RESULTS
The financial results of the Company for the year ended 31 March 2015 have beendisclosed as per Schedule III to the Companies Act 2013.
As Company has no subsidiaries and joint ventures Company the summary of the keyfinancials of the Companys (Form AOC-1) is not applicable to comply.
Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 theprescribed particulars are set out in an annexure to the Directors Report. As perprovisions of section 136(1) of the said Act these particulars will be made available toshareholder on request.
A Cash Flow Statement for the year 2014-15 is attached to the Balance Sheet.
Pursuant to the legislation 'Prevention Prohibition and Redressal of Sexual Harassmentof Women at Workplace Act 2013' introduced by the Government of India which came intoeffect from 9 December 2013 the Company has framed a Policy on Prevention of SexualHarassment at Workplace. There was no case reported during the year under review under thesaid Policy.
The company has put in place a system of Corporate Governance. A Separate report onCorporate Governance forming part of the Annual Report is annexed hereto. A Certificatefrom the Auditors of the company regarding compliance of conditions of CorporateGovernance as stipulated under The Corporate Governance clause of the Listing Agreement isannexed to the report on Corporate Governance.
PARTICULARS OF EMPLOYEES
Information as per Section 197 of the Companies Act 2013 (the Act) readwith the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014forms part of this Report is NIL .However salary being paid to wholetime directors ismentioned in Corporate Governance Report.
ANNUAL PERFORMANCE EVALUATION BY BOARD
Pursuant to the provisions of the Companies Act 2013 and Clause 49 to the ListingAgreement the Board has carried out an Annual Performance Evaluation of its ownperformance the Directors individually as well as the evaluation of the working of theCommittees. The manner in which the evaluation was carried out has been explained in theCorporate Governance Report.
The Board of Directors of your Company has on recommendation of the Risk ManagementCommittee framed and adopted a policy on Risk Management of the Company. The broad termsof reference of the Committee are stated in the Corporate Governance Report.
Your Company has an effective Vigil Mechanism system which is embedded in its Code ofConduct. The Code of Conduct of your Company serves as a guide for daily businessinteractions reflecting your Companys standard for appropriate behavior and livingCorporate Values. The Code of Conduct applies to all Colgate People including DirectorsOfficers and all employees of the Company. Even your Company vendors and suppliers arealso subject to these requirements as adherence to the Code is a prerequisite forconducting business with your Company.
NOMINATION & REMUNERATION POLICY
The Board of Directors of your Company has on recommendation of the Nomination &Remuneration Committee framed and adopted a policy for selection and appointment ofDirectors Senior Management and their remuneration. The contents of the policy are statedin the Corporate Governance Report.
Pursuant to the provisions of section 139 of the Companies Act 2013 and the Rules madethereunder the current auditors of the Company M/s Dass Khanna & Co. CharteredAccountants Ludhiana (registration number: 000402N) were appointed by the shareholders atthe 41st annual general meeting to hold office until the conclusion of the 44th annualgeneral meeting to be held on 2017 subject to ratification by shareholders at each annualgeneral meeting.
The members are requested to ratify the appointment of M/s Dass Khanna & Co.Chartered Accountants Ludhiana (registration number: 000402N) as statutory auditors ofthe Company and to fix their remuneration for the year 2015-16.
The statutory audit report does not contain any qualification reservation or adverseremark or disclaimer made by statutory auditor.
Auditors Comments on Corporate Governance Report are reply below in para pertainsto Secretarial Auditor.
Pursuant to the provisions of section 204 of the Companies Act 2013 and Rules madethereunder the Company has appointed Baldev Arora & Associates (membership number:4283) Company Secretaries in Practice to undertake the secretarial audit of the Company.Secretarial Audit Report for the year 2014-15 given by Baldev Arora & Associates inthe prescribed form MR-3 is annexed to this Report. The Secretarial Audit Report for theyear under review does contain some observations Para wise reply as same is given hereunder:-
- Company has filed all the forms with additional fee
- Company is in process to pay fee to all authorities / agencies as mentioned inreport.
- Management is looking for a competent person to appoint him as an independentDirector and members of committee.
- The management has decided to publish the notice of intimation of date of boardmeeting again under clause 41(II) b of Listing agreement it was stopped as company givesnotice to stock exchanges in advance regarding intimation of Date of Board meetings bymail as well as by post and ever publish the financial results in required news papersnon publication of intimation was only to save funds of company.
- Management is in process to update website as per the requirement of law.
Pursuant to section 148 of the Companies Act 2013 and Rules made thereunder Board ofDirectors had on the recommendation of the Audit Committee appointed M/s Meenu &Associates (firm registration number: 100729) Cost Accountants to audit the costaccounts of the Company for the financial year 2015-16 at a remuneration of Rs. 45000.00plus service tax out-of pocket and travel and living expenses subject to ratification bythe shareholders at annual general meeting. Accordingly a resolution seekingmembers ratification for the remuneration payable to cost auditor is included in theNotice convening the annual general meeting.
The Industrial relations remained cordial through out the year and have resulted insustained growth of the company.
The Directors wish to extend their sincere thanks to the Punjab & Sind Bank PunjabState Power Corporation Limited Container Corporation of India other State & CentralGovernment Agencies Suppliers and Customers for their continued support and co-operation.
The Directors also wish to place on record their deep appreciation for the servicesrendered by the workers & staff at all levels.
| ||For and on behalf of the Board |
| ||SD/- |
|Place: LUDHIANA. ||(DEVINDER GARG) |
|Date: 01/09/2015 ||CHAIRMAN |
| ||(DIN : 01665456) |
ANNEXURE TO BOARD REPORT
Information pursuant to Section 134 (3)(m) of The Companies Act 2013 read with Rule 5of Companies (Accounts) Rules 2014 and forming part of the Director's Report for the yearended 31st March 2015
I. CONSERVATION OF ENERGY
|a) Energy conservation measures ||: ||The company has always been conscious of the need to conserve energy and has always attempted various measures for the same wherever possible to achieve reduction in cost of production. The company has taken various measures on suggestions of experts in the areas where energy reduction and fuel & oil conservation is possible. The Company has installed LED lamps in place of failed Tube lights and CFL thereby reducing energy consumption in lighting during the year |
|b) Additional Investment and proposals if any being implemented for reduction of energy consumption. ||: ||No. |
|c) Impact of Measures taken at (a) above for reduction of energy consumption and consequent impact on the cost of production of goods. ||: ||5% Saving in Energy consumption. |
|d) Total energy consumption per unit of production as per form A of the annexure to the rules in respect of industries specified in schedule thereto. || || |
A. POWER & FUEL CONSUMPTION
|1. Electricity ||Current Year ||Previous Year |
|a) Purchased || || |
|Units(KWH) (in Units) ||14680250 ||11564443 |
|Total amount ||Rs.102100380.00 ||Rs.82338834.00 |
|Rate per unit ||Rs. 6.95 ||Rs. 7.12 |
|b) Own Generation ||Current Year ||Previous Year |
|i) Through Diesel Generator Units (KWH) ||25850 ||26800 |
|Units per litre of diesel ||3.90 ||3.90 |
|Oil Cost/unit ||Rs. 12.59 ||Rs. 13.25 |
|ii) Through steam Turbine ||Nil ||Nil |
|2. Coal || || |
|Quantity (Kgs) ||712430 ||743129 |
|Total Amount ||Rs. 7781007.00 ||Rs. 8869515.00 |
|Average Rate per Kg ||Rs. 10.92 ||Rs. 11.93 |
|B. CONSUMPTION PER UNIT OF PRODUCTION || || |
|Products ||Current Year ||Previous Year |
|Electricity (KWH) Steel Ingots Rounds ||404 Units (*) ||413 Units (*) |
|Castings/Wire Rod/Mig wire || || |
|Coal Rounds/Castings/Wire Rod ||40 Kgs ||41 Kgs |
(*) Consumption for separate products is not feasible.
II. TECHNOLOGY ABSORPTION
|Efforts made in technology absorption are as under: || |
|A. Research and Development (R&D) ||Nil |
|B. Technology absorption adoption and innovation ||Nil |
The manufacturing process is based on the indigenous know-how. We are adopting watercooling system with heat exchanger and colloid-A-Tran equipment for improvement in theworking of the plant.
III. FOREIGN EXCHANGE EARNING AND OUT GO
| ||2014-15 ||2013-2014 |
|Total Foreign Exchange earned ||NIL ||NIL |
|Used (CIF Value of Imports) ||Rs. 216577733.00 ||Rs. 210206528.00 |