We have pleasure in presenting the Twenty Second (22nd) Annual Report on thebusiness and operations of the Company and Financial Results for the year ended 31stMarch 2016.
The financial performance of the Company for the financial year ended 31stMarch 2016 is summarized below:-
| || || ||Rs. In Lakhs. |
|S.No ||Particulars ||Year ended 31.03.2015 ||Year ended 31.03.2014 |
|1. ||Sales ||65.76 ||77.09 |
|2. ||Other Income ||28.79 ||35.93 |
|3. ||Total Income (1+2) ||94.55 ||113.02 |
|4. ||Total Expenses other than interest ||(137.41) ||(157.34) |
|5. ||Financial Cost ||0 ||0 |
|6. ||Total Expenses other than Depreciation ||83.84 ||101.29 |
|7. ||Depreciation ||53.56 ||56.05 |
|8. ||Miscellaneous Expenditure Written off ||0.00 ||0.00 |
|9. ||Profit/ (Loss) for the before tax ||(42.86) ||(44.32) |
|10. ||Provision for tax:MAT ||0.00 ||0.00 |
|11. ||Deferred Tax(Liability)/ Asset ||95.46 ||13.70 |
|12. ||Profit/(Loss) for the year after tax ||52.60 ||(30.62) |
During the financial year ended as on 31st March 2016 the Company recordeda total revenue of Rs. 9455323 (Previous financial year Rs. 11301973) and earned NetProfit after taxes of Rs. 5260383 (Previous Year Net Loss after tax of Rs. 3062020).
EVENTS SUBSEQUENT TO THE DATE OF FINANCIAL STATEMENT:
There were no significant material changes and commitments affecting financial positionof the company between 31st March 2016 and the date of Board's Report.
CHANGE IN THE NATURE OF BUSINESS IF ANY:
There was no change in the nature of business of the Company during the financial year.
The Authorized Share Capital of the Company as on 31st March 2016 was Rs.105000000/- divided into 10500000 equity shares of Rs. 10/- each.
The Paid up Capital of the Company is Rs. 64901590 divided into 6490159 EquityShares of Rs. 10/- each.
Your Directors does not propose to carry any amount to the General Reserve Account inview of insufficient profits.
In view of insufficient profits for the year under review the Board is unable torecommend dividend. UNSECURED LOAN:
During the financial year the Company has not obtained any unsecured loan. Howeverthe Company has an outstanding unsecured loan amounting to Rs. 44994579/- obtained fromthe related parties of the Company.
Your Company has executed fresh Listing Agreement 22nd February 2016 withBSE Limited in compliance with Regulation 109 of SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015.
A separate report on Corporate Governance is enclosed as a part of this Annual Report.A certificate from the Auditors of the Company regarding compliance with CorporateGovernance norms stipulated under the SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 is annexed to the Report on Corporate Governance.(Annexurel)
MANAGEMENT DISCUSSION AND ANALYSIS REPORT:
Management's Discussion and Analysis Report for the year under review as stipulatedunder Regulation 34 of the SEBI (LODR) Regulations 2015 is presented in a separatesection forming part of the Annual Report. (Annexure II)
DIRECTORS AND KEY MANAGERIAL PERSONNEL:
A. RETIREMENT BY ROTATION:
Pursuant to provisions of the Companies Act 2013 Mr. Srikrishna Naik (DIN: 01730236)Director will retire at this Annual General Meeting and being eligible offers himself forreappointment. The Board recommends his re-appointment.
i. Mr. Ramana Naik Bhukya Peda (DIN: 01396345) was appointed as an Additional Directoron the Board on 30th September 2015 who shall hold office till the date ofthis Annual General Meeting. A member proposed his candidature for appointment at thisAnnual General Meeting.
In terms of the Companies Act 2013 Mr. Ramana Naik Bhukya Peda is proposed to beappointed as independent Director for a term of 5 years w.e.f. 30thh September 2015 notliable for retirement by rotation.
Brief resume of the Directors seeking re-appointment who is liable to retire byrotation and appointment of independent Director nature of his expertise in specificfunctional areas and names of Companies in which he hold directorships as stipulated underRegulation 36 of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015are given as Annexure to the Notice.
i. During the financial year Mr. Kotte Suresh (DIN: 01440949) has resigned from thepost of Directorship (Independent Director) of the Company with effect from 30thSeptember 2015 because of his pre-occupations. The Company took on record and appreciateshis valuable contribution towards the Company.
D. EVALUATION OF THE BOARD'S PERFORMANCE:
During the year the Board adopted a formal performance evaluation policy forevaluating its performance and as well as that of its Committees and individual Directorsincluding the Chairman of the Board. The exercise was carried out through a structuredevaluation process covering various aspects of the Board's functioning such as compositionof the Board & committees experience & competencies performance of specificduties & obligations etc. Separate exercise was carried out to evaluate theperformance of individual Directors including the Board Chairman who were evaluated onparameters such as attendance contribution at the meetings and otherwise independentjudgment etc. The evaluation of the Independent Directors and that of the Chairman wascarried out by the entire Board excluding the Director being evaluated and the evaluationof Non-Independent Directors was carried out by the Independent Directors. A separatemeeting of Independent Directors was also held during the year wherein the performance ofChairman Board and Executive Directors was evaluated.
The Directors were satisfied with the evaluation results which reflected the overallengagement of the Board and its Committees with the Company.
E. DECLARATION BY INDEPENDENT DIRECTORS:
All the Independent Directors of the Company have given declaration stating that theymeet the criteria of independence as provided under Companies Act 2013 and Regulation16(l)(b) of the SEBI (Listing Obligations and Disclosures Requirements) Regulations 2015.
F. FAMILIARIZATION PROGRAMME OF INDEPENDENT DIRECTORS:
As required under Regulation 25(7) of the SEBI (Listing Obligations and DisclosuresRequirements) Regulations 2015 each newly appointed Independent Director is takenthrough a formal induction program including the presentation from the Managing Directoron the Company's manufacturing marketing finance and other important aspects. Theinduction for Independent Directors include interactive sessions with Executive CommitteeMembers Business and Functional Heads visit to the manufacturing site etc.
A. REMUNERATION POLICY
The Board has on the recommendation of the Nomination & Remuneration Committeeframed a policy for selection and appointment of Directors Senior Management and theirremuneration as required under Sec 178 of the Companies Act 2015 and Regulation 19(4)read with schedule II of the SEBI (Listing Obligations and Disclosures Requirements)Regulations 2015. The Remuneration Policy is attached to this report (Annexure III).
B. VIGIL MECHANISM/WHISTLE BLOWER POLICY:
The Company has formulated a Whistle blower policy and has established vigil mechanismfor employees including Directors of the Company to report genuine Concerns. Theprovisions of this Policy are in line with the provisions of the Section 177(9) of theAct.
C. POLICY ON BOARD DIVERSITY:
The Board has on the recommendation of the Nomination & Remuneration Committeeframed a policy on Board Diversity as required Regulation 19(4) read with Part D ofSchedule II of the SEBI (Listing Obligations and Disclosures Requirements) Regulations2015.
D. RISK MANAGEMENT POLICY:
The Board of Directors have adopted an Enterprise Risk Management Policy framed by theCompany which identifies the risk and lays down the risk minimization procedures. Theseprocedures are periodically reviewed to ensure that executive management controls riskthrough means of a properly defined framework.
E. PRESERVATION OF DOCUMENTS AND ARCHIVAL POLICY:
The Company has formulated a Policy pursuant to Regulation 9 and 30(4) of the SEBI(Listing obligations and Disclosure Requirements) Regulations 2015 on Preservation of theDocuments to ensure safekeeping of the records and safeguard the Documents from gettingmanhandled while at the same time avoiding superfluous inventory of Documents.
F. POLICY ON DISCLOSURE OF MATERIAL EVENTS/INFORMATION:
The Policy is framed in accordance with the requirements of the Regulation 30 of SEBI(Listing Obligations and Disclosure Requirements) Regulations 2015. The objective of thePolicy is to determine materiality of events or information of the Company and to ensurethat such information is adequately disseminated in pursuance with the Regulations and toprovide an overall governance framework for such determination of materiality.
G. POLICY ON RELATED PARTY TRANSACTIONS:
The Board of Directors has adopted a Policy on materiality of and dealing with relatedparty transactions. No material contract or arrangements with related parties were enteredinto during the year under review.
Your Company's Policy on Related Party Transactions as adopted by your Board can beaccessed on the Company's website.
H. INSIDER TRADING POLICY:
The Board of Director has adopted the Insider Trading Policy in accordance with therequirement of the SEBI (Prohibition of Insider Trading) Regulations 2015. The InsiderTrading policy of the Company lays down guidelines & procedures to be followed anddisclosures to be made while dealing with the shares of the Company as well as theconsequences of the violations. The policy has been formulated to regulate monitor andensure reporting of deals by employees and to maintain highest ethical standards ofdealing in Companies shares.
The Insider Trading Policy of the company covering code of practices and procedures forfair disclosure of unpublished price sensitive information and code of conduct forpreventing of insider trading same is available on our website.
AUDITORS & AUDITORS' REPORT:
A. STATUTORY AUDITORS
The Statutory Auditors of the Company M/s. L S Reddy & Associates CharteredAccountants Hyderabad were appointed in the 21st Annual General Meeting forfive years (i.e. till the conclusion of 26th Annual General Meeting) subject toratification by the members at every Annual General meeting and has shown theirwillingness for re-appointment.
The Board recommends the re-appointment of M/s. L S Reddy & Associates. CharteredAccountants
(Firm Reg. No. 012848S) as the Statutory Auditors of the Company to hold office fromthe conclusion of the ensuing Annual General Meeting till the conclusion of Twenty SixthAnnual General Meeting subject to the ratification by the shareholders of the company ineach and every Annual General Meeting. M/s L S Reddy & Associates CharteredAccountants (Firm Reg. No. 012848S) have confirmed their eligibility under Section 141 ofthe Companies Act 2013 and the Rules framed there under for re-appointment as Auditors ofthe Company.
The Auditors' Report does not contain any reservation qualification or adverseremarks.
B. SECRETARIAL AUDITOR:
During the year the Company has appointed M/s Venkatraman Hegde Practicing CompanySecretaries as Secretarial Auditor. The Secretarial Audit report for the financial year2015-16 is annexed herewith to this Report.(Annexure IV)
Reply to the remarks of Secretarial Auditor:
Since your company operations are limited and the company is running into losses thecompany has not appointed a whole time company secretary and an Internal Auditor.
However Company has appointed R & A Associates Company Secretaries Firm asconsultants to advice on the secretarial compliances and the listing compliances.
Promoters of the Company are in the process for dematerializing their completeshareholding. DIRECTORS' RESPONSIBILITY STATEMENT:
To the best of their knowledge and belief and according to the information andexplanations obtained by them your Directors make the following statements in terms ofSection 134(3)(c) of the Companies Act 2013:
(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 this Act for safeguarding theassets of the company and for preventing and detecting fraud and other irregularities;
(d) the directors had prepared the annual accounts on a going concern basis;
(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.
NAMES OF THE SUBSIDIARIES/ASSOCIATES/JOINT VENTURES:
No companies have become or ceased to be as its Subsidiaries joint ventures orassociate companies- during the year.
CORPORATE SOCIAL RESPONSIBILITY:
The Company is not required to constitute a Corporate Social Responsibility Committeeas it does not fall within purview of Section 135(1) of the Companies Act 2013 and henceit is not required to formulate policy on Corporate Social Responsibility.
RELATED PARTY TRANSACTIONS:
Your Directors draw attention of the members to Notes to the financial statement whichsets out related party disclosures.
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION FOREIGN EXCHANGE EARNINGS AND OUTGO:
The particulars relating to conservation of energy technology absorption foreignexchange earnings and outgo is annexed and marked and forms part of this Report.(Annexure V)
INTERNAL FINANCIAL CONTROLS:
The Company has in place adequate internal financial controls with reference tofinancial statements. During the year such controls were tested and no reportablematerial weakness in the design or operation was observed.
PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS UNDER SECTION 186:
The Company has not given any loan given guarantee or provided security or made anyinvestments pursuant to the provisions of Section 186 of Companies Act 2013.
DISCLOSURE PERTAINING TO SEXUAL HARRASMENT OF WOMEN AT WORKPLACE:
Your Company has always believed in providing a safe and harassment free workplace forevery individual working in premises through various interventions and practices. TheCompany always endeavours to create and provide an environment that is free fromdiscrimination and harassment including sexual harassment.
Also there were no complaints reported under the Prevention of Sexual Harassment ofWomen at Workplace (Prevention Prohibition and Redressal) Act 2013.
A. EXTRACT OF ANNUAL RETURN:
Extract of Annual Return of the Company is annexed herewith to this Report. (AnnexureVI)
B. COMPOSITION OF AUDIT COMMITTEE:
The Audit Committee comprises of Mr. Pramod Hariharrao Puradupadhye Mr. Ramana NaikBhukya Peda and Ms. Meena Bhushan Kerur as other members.
All the recommenda tions made by the Audit Committee were accepted by the Board.
C. VIGIL MECHANISM:
The Company has implemented a vigil mechanism policy to deal with instance of fraud andmismanagement if any. It provides for the directors and employees to report genuineconcerns and provides adequate safeguards against victimization of persons who use suchmechanism. The Policy on vigil mechanism may be accessed on the Company's website at thelink: http:// www.goldencarpets.com/whistle-bIower-pohcy.html. There were no complaintsreceived during the year 2015-16.
D. NUMBER OF BOARD MEETINGS:
The Board of Directors of the Company met Seven (7) times during the financial year.For further details please refer report on Corporate Governance.
E. LISTING FEES:
The Company confirms that it has paid listing fees for the year to BSE Limited whereits shares are listed.
PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES:
The information relating to remuneration of Directors and details of the ratio of theremuneration of each Director to the median employee's remuneration and other details asrequired pursuant to section 197(12) of the Act read along with Rule 5(1) of the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 is annexed. (Annexure-VII)
Pursuant to Rule 5(2) of the Companies (Appointment and Remuneration ManagerialPersonnel) Rule 2014 there are no employees who are in receipt of remuneration of Rs.10200000/- or more per annum or Rs. 850000/- or more per month or where employed fora part of the year.
Your Directors state that no disclosure or reporting is required in respect of thefollowing items as there were no transactions on these items during the financial yearunder review:
a. Details relating to deposits covered under Chapter V of the Companies Act 2013.
b. The Company has no subsidiaries joint ventures or associate companies.
c. No significant or material orders were passed by the Regulators or Courts orTribunals which impact the going concern status and Company's operations in future.
The Board of Directors is pleased to place on record their appreciation of theco-operation and support extended by the Financial Institutions Banks and various Stateand Central Government Agencies.
The Board would also like to thank the Company's shareholders customers suppliers forthe support and the confidence which they have reposed in the management. The Board placeon record its appreciation of the contribution made by the employees at all levels fortheir hard work solidarity co-operation and support.
| ||By order of the Board of Directors |
| ||For Golden Carpets Ltd |
| ||Sd/- |
|Place: Hyderabad ||Sri Krishna Naik |
|Date: 01-09-2016 ||Chairman & Managing Director |
| ||DIN: 01730236 |
| ||Add: 8-2-596/5/B/l Road No 10 |
| ||Banjara Hills |
| ||Hyderabad 500034 Telangana |
Golden Carpets Ltd (GCL) recognizes the importance of aligning the business objectiveswith specific and measureable individual objectives and targets. The Company has thereforeformulated the remuneration policy for its Directors Key Managerial Personnel and otheremployees keeping in view the following objectives:
a) Ensuring that the level and composition of remuneration is reasonable and sufficientto attract retain and motivate to run the company successfully.
b) Ensuring that relationship of remuneration to performance is clear and meets theperformance benchmarks.
c) Ensuring that remuneration involves a balance between fixed and incentive payreflecting short and long term performance objectives appropriate to the working of thecompany and its goals.
2. SCOPE AND EXCLUSION:
This Policy sets out the guiding principles for the Nomination and RemunerationCommittee for recommending to the Board the remuneration of the directors key managerialpersonnel and other employees of the Company.
3. TERMS AND REFERENCES:
In this Policy the following terms shall have the following meanings:
"Director" means a Director appointed to the Board of the Company.
"Key Managerial Personnel" means
(i) the Chief Executive Officer or the Managing Director or the manager;
(ii) the Company secretary;
(iii) the Whole-time director;
(iv) the Chief Financial Officer; and
(v) such other officer as may be prescribed under the Companies Act 2013
"Nomination and Remuneration Committee" means the committee constituted bythe Company Board in accordance with the provisions of Section 178 of the CompaniesAct2013 and Clause 49 of the Equity Listing Agreement.
A. Criteria for Appointment of Non-Executive Directors &Independent Directors:
a) The Non-Executive Directors shall be of high integrity with relevant expertise andexperience so as to have a diverse Board with Directors having expertise in the fields ofmarketing finance taxation law governance and general management.
b) In case of appointment of Independent Directors the Nomination & Remuneration(N&R) Committee shall satisfy itself with regard to the independent nature of theDirectors vis-avis the Company so as to enable the Board to discharge its function andduties effectively.
c) The N&R committee shall ensure that the candidate identified for appointment asa director is not disqualified for appointment under section 164 of the Companies Act2013.
d) In case of re-appointment of Non-Executive Directors & Independent Directorsthe Board shall take into consideration the performance evaluation of the Director and hisengagement level.
Remuneration of Non-Executive Directors & Independent Directors
i. A Non-Executive Director & Independent Director shall be entitled to receivesitting fees for each meeting of the Board or Committee of the Board attended by him ofsuch sum as may be approved by the Board of Directors within the overall limits prescribedunder the Companies Act 2013 and the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014 including any amendment or modification thereto as may be in force;
ii. The Independent Directors of the Company shall not be entitled to participate inthe Stock Option Scheme of the Company if any introduced by the Company.
B. Criteria for Appointment of Executive Directors and Key Managerial Personnel (KMP):
For the purpose of appointment of any Executive Director and Key Managerial Personnel(KMP) the N&R Committee shall identify persons of integrity who possess relevantexpertise experience and leadership qualities required for the position. The Committeeshall also ensure that the incumbent fulfils such other criteria as laid down under theCompanies Act 2013 read with Rules made there under or other applicable laws.
Remuneration of Executive Directors & KMP:
i. The Board on the recommendation of the Nomination and Remuneration (N&R)Committee
shall review and approve the remuneration payable to the Executive Directors of theCompany within the overall limits prescribed under Companies Act 2013 including anystatutory modification or amendment thereto as may be in force subject to approval by theshareholders in General Meeting.
ii. The Board on the recommendation of the N&R Committee shall also review andapprove the remuneration payable to the Key Managerial Personnel of the Company.
iii. The remuneration of the Executive Directors and KMP may be broadly divided intofixed and variable components. The fixed component comprises salary allowancesperquisites amenities and retrial benefits. The variable component comprises performancebonus.
C. Remuneration to Other Employees:
i. Employees shall be assigned grades according to their qualifications and workexperience competencies as well as their roles and responsibilities in the organization.Individual remuneration shall be determined within the appropriate grade and shall bebased on various factors such as job profile skill sets seniority experience andprevailing remuneration levels for equivalent jobs.
ii. The remuneration maybe divided into two components viz. fixed component comprisingsalaries perquisites and retirement benefits and a variable component comprisingperformance bonus.
Particulars of Energy Conservation Technology Absorption and Foreign Exchange Earningsand Outgo
[Pursuant to Companies (Accounts) Rules 2014]
A CONSERVATION OF ENERGY
|i) The steps taken or impact on conservation of energy ||The necessary steps were undertaken by a Company to improve upon the energy conservation measures. |
|ii) The steps taken by the Company for utilizing alternate sources of energy ||Nil |
|iii) The capital investment on energy conservation equipments ||Nil |
|B. TECHNOLOGY ABSORPTION || |
|i) The efforts made towards technology absorption ||NA |
|ii) The benefits derived like product improvement cost reduction product development or import substitution ||NA |
|iii) In case of imported technology (imported during the last three years reckoned from the beginning of the financial year) ||NA |
|a. The details of technology imported ||NA |
|b. The year of import ||NA |
|c. Whether the technology been fully absorbed ||NA |
|d. If not fully absorbed areas where absorption has not taken place and the reasons thereof and ||NA |
|iv) The expenditure incurred on Research and Development ||NA |
C FOREIGN EXCHANGE EARNINGS AND OUTGO
|Foreign Exchange Earnings & Outgo: ||2015-16 ||2014-15 |
|Earnings ||Nil ||Nil |
|Outgo ||24.31 Lacs ||Nil |