M/S. HARIA APPARELS LIMITED MUMBAI.
Your Directors have pleasure in presenting their Fifth Annual Report on the businessand operation of the Company and the accounts for the Financial Year ended March 31st2016.
1. Financial Summary or Highlights/Performance of the Company (Standalone)
|Particulars || |
Financial Year ended
| ||31st March 2016 ||31st March 2015 |
|Total Income ||24401421 ||20585676 |
|Expenditure ||30496845 ||34670789 |
|Profit before Depreciation Finance Charges and Tax ||14453676 ||10363920 |
|Interest and Finance Charges ||4266153 ||3869343 |
|Depreciation ||16282947 ||20579690 |
|Profit before Tax ||(6095424) ||(14085113) |
|Taxes paid and provided ||5540345 ||1919990 |
|Profit after Tax ||(11635769) ||(16005104) |
|Transferred to Reserves ||NIL ||NIL |
|Proposed Final Dividend ||NIL ||NIL |
|Dividend distribution tax ||NIL ||NIL |
|Balance (credit/debit) to be carried to balance sheet. ||(11635769) ||(16005104) |
2. Operational Performance
Revenue from operations has increased during the year Rs.2.44 Cr as compared toprevious year Rs.2.05 Cr.
The Company has suffered a Loss which has increased byRs 1.16 Cr in the CurrentYear as Compared to Last Year's Loss of Rs. 1.60 Cr.
3. Management Discussion & Analysis
The detailed Management Discussion & Analysis Report for the year under review asstipulated under Listing Regulations is presented in a separate section forming part ofthe Annual Report.
In view of the losses incurred by the Company during the financial year under reviewyour Directors are unable to recommend any dividend for F.Y. 2015-2016.
The Company has not transferred any amount to the Reserves during the Year underReview.
6. Brief description of the Company's working during the vear/State of Company's affair
The Company is engaged in the Business of Manufacturing of Garments and trading ofGoods. The Company has earned Rent Income and Dividend Income during the Year underReview.
7. Change in the nature of business if any
No Changes have occurred in the Nature of the Business during the Year under Review.
8. Material changes and commitments if any affecting the financial position of thecompany which have occurred between the end of the financial year of the company to whichthe financial statements relate and the date of the report No Material changes andcommitments affecting the financial position of the company have occurred between the endof the financial year of the company to which the financial statements relate and the dateof the report.
9. Details of significant and material orders passed by the regulators or courts ortribunals impacting the going concern status and company's operations in future
No Significant and Material Orders have been passed by the regulators or courts ortribunals impacting the going concern status and company's operations in future during theYear under Review.
10. Details in respect of adequacy of internal financial controls with reference to theFinancial Statements.
Your Company has in place adequate internal financial controls with reference tofinancial statements. Your Company has adopted the policies and procedures for ensuringthe orderly and efficient conduct of its business including adherence to the Company'spolicies the safeguarding of its assets the prevention and detection of frauds anderrors the accuracy and completeness of the accounting records and the timely preparationof reliable financial disclosures.
11. Details of Subsidiarv/Joint Ventures/Associate Companies
No Company has become or has ceased to become a Subsidiary/Associate Company during theYear under review.
12. Performance and financial position of each of the subsidiaries associates andjoint venture companies included in the consolidated financial statement.
The Financial Position of the Associates is annexed to the Boards Report as Annexure A(AOC-1).
The Company has not accepted any Deposits within the meaning of section 73 of theCompanies Act 2013 and the Rules made there under. Hence there is nothing to Report inthis Matter. The Company has however repaid the Unsecured Loans from Inter-CorporateDeposits.
14. Statutory Auditors
M/s. Kanak Rathod & Co. the retiring Statutory Auditors of the Company vide theirletter dated 25th May 2016 express their inability to seek re-election as StatutoryAuditors of the Company for the Financial Year 2016-2017.
In response to the said letter the Board of Directors of your Company had a discussionwith M/s. Sunderji Gosar & Co. Chartered Accountants Mumbai to be appointed asStatutory Auditors for the Financial Year 2016-2017 till the conclusion of the forthcomingAGM till the conclusion of the 10 (Tenth) Annual General Meeting subject to ratificationat every subsequent Annual General Meeting held after this Annual General Meeting.
Members are requested to consider the appointment of M/s. Sunderji Gosar & Co. andauthorize the Board of Directors to fix their remuneration.
Pursuant to the provisions of Section 204 of the Act and The Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014 theBoard ofDirectors ofthe Company hadappointed CS. MilindNirkhe Practicing Company Secretary (Proprietor) Practicing underthe name & style M/S Milind Nirkhe & Associates CP No: 2312 to undertake theSecretarial Audit of the Company for the year ended 31st March 2016. The SecretarialAudit Report is annexed as Annexure. The Secretarial Audit Report for the financial yearended March 31 2016 do not contain any qualification reservation adverse remark ordisclaimers which are replied suitably.
The Company was engaged in trading of Fabrics during the Financial Year 2015-2016 &hence the Company was not required to appoint the Cost Auditor for the Financial Year2015-2016.
15. Auditors' Report
Comments made by the Statutory Auditors in the Auditors' Report are self- explanatoryand do not require any further clarification.
16. Share Capital
The paid up Equity Share Capital as on March 312016 was Rs. 152898000/- during theyear under review. The Company has not issued any shares.
A) Issue of equity shares with differential rights
The Company has not issued shares with differential voting rights during the year
B) Issue of sweat equity shares
The Company has not issued employee stock options and does not have any scheme to fundits employees to purchase the shares of the Company
C) Issue of employee stock options
The Company has not issued sweat equity shares during the year.
17. Extract of the annual return
Pursuant to Section 92 (3) of the Act and Rule 12 (1) ofThe Companies (Management andAdministration) Rules 2014 the extract of Annual Return in form MGT.9 is annexed asAnnexure I.
18. Conservation of energy technology absorption and foreign exchange earnings andoutgo
The Information Regarding Conservation of Energy & Technology Absorption isprovided for in Annexure- II.
Foreign Exchange Earnings and Outgo:
| ||Amount (Rupees |
|Total Foreign Exchange Inflow ||NIL |
|Total Foreign Exchange outflow ||NIL |
19. Corporate Social Responsibility (CSR)
As a socially responsible Company your Company has a strong sense of communityresponsibility.
The Company however does not fall within the above Criteria as laid down by the Act isnot required to constitute a CSR Committee. Further the Company has been suffering a lossfor the Last two Years; hence the Company has not formulated any Policy.
A) Changes in Directors and Key Managerial Personnel
Appointments and changes in Designation during the Year under Review.
1) There is no change in the composition of Board of Directors.
B) Declaration by an Independent Directors! and re- appointment if any
The Company has received Declaration from Independent directors Pursuant to theProvisions of Section 149 subsection (6) of the Companies Act 2013
C) Formal Annual Evaluaation;
Pursuant to the provisions of the Companies Act 2013 the Board had carried outevaluation of its own performance performance of the Directors as well as the evaluationof the working of its Committees. The Nomination and Remuneration Committee has definedthe evaluation criteria procedure and time schedule for the Performance Evaluationprocess for the Board its Committees and Directors.
The Board's functioning was evaluated on various aspects including inter alia degreeof fulfillment of key responsibilities Board structure and composition establishment anddelineation of responsibilities to various Committees effectiveness of Board processesinformation and functioning. Directors were evaluated on aspects such as attendance andcontribution at Board/Committee Meetings and guidance/ support to the management outsideBoard/Committee Meetings. In addition the Chairman was also evaluated on key aspects ofhis role including setting the strategic agenda of the Board encouraging activeengagement by all Board members and motivating and providing guidance to the ManagingDirector & CEO. Areas on which the Committees of the Board were assessed includeddegree of fulfillment of key responsibilities adequacy of Committee composition andeffectiveness of meetings.
The performance evaluation of the Independent Directors was carried out by the entireBoard excluding the Director being evaluated. The performance evaluation of the Chairmanand the Non Independent Directors was carried out by the Independent Directors who alsoreviewed the performance of the Board as a whole. The Nomination and RemunerationCommittee also reviewed the performance of the Board its Committees and of the Directors.The Chairman of the Board provided feedback to the Directors on an individual basis asappropriate. Significant highlights learning and action points with respect to theevaluation were presented to the Board.
21. Number of meetings of the Board of Directors
The Board of Directors of the Company has met 06 times during the Year under review
|Date of the meeting ||No. of Directors attended the meeting |
|27/04/2015 ||6 |
|14/05/2015 ||6 |
|30/05/2015 ||6 |
|14/08/2015 ||6 |
|06/11/2015 ||6 |
|12/02/2016 ||6 |
22. Audit Committee:
Audit Committee of the Company as constituted by the Board is headed by Mr. MohithSuddala as the Chairman with Mr. Kantilal Haria and Mr. Nitin Oza as Members. There havenot been any instances during the year when recommendations of the Audit Committee werenot accepted by the Board. All the recommendations made by the Audit Committee wereaccepted by the Board.
23. Details of establishment of vigil mechanism for directors and employees
The Company has adopted a Whistle Blower Policy to provide a formal mechanism to theDirectors and employees to report their concerns about unethical behaviour actual orsuspected fraud or violation of the Company's Code of Conduct or ethics policy. The Policyprovides for adequate safeguards against victimization of employees who avail of themechanism and also provides for direct access to the Chairman of the Audit Committee. Itis affirmed that no personnel of the Company has been denied access to the AuditCommittee.
24. Nomination and Remuneration Committee
The Nomination and Remuneration Committee has considered the following factors whileformulating the Policy:
(i) The level and composition of remuneration is reasonable and sufficient to attractretain and motivate Directors of the quality required to run the Company successfully;
(ii) Relationship of remuneration to performance is clear and meets appropriateperformance benchmarks; and
(iii) Remuneration to Directors Key Managerial Personnel and Senior Managementinvolves a balance between fixed and incentive pay reflecting short and long-termperformance objectives appropriate to the working of the Company and its goals.
25. Policy on prevention prohibition and redressal of sexual harassment at workplace:
The Company has zero tolerance for sexual harassment at workplace and has adopted aPolicy on Prevention Prohibition and Redressal of Sexual Harassment at the Workplace inline with the provisions of the Sexual Harassment of Women at Workplace (PreventionProhibition and Redressal) Act 2013 and the Rules there under.
The Company has less than 10 Employees and hence is not required to constitute theInternal Complaints Committee.
26. Particulars of loans guarantees or investments under section 186
The Company has given Loans or Guarantees to Material Related Parties as detailed inAnnexure IV.
27. Particulars of contracts or arrangements with related parties:
The Particulars of Contracts or arrangements with related Parties is provided for inAnnexure III (AOC-2).
28. Particulars of Employees
During the financial year under review none of the Company's employees was in receiptof remuneration as prescribed under Rule 5 (2) and (3) of The Companies (Appointment andRemuneration ofManagerial Personnel) Rules. Hence no particulars are required to bedisclosed in this Report.
The information required under Section 197 (12) of the Act read with Rule 5 of TheCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014 is annexed.
The ratio of remuneration of each Director to the Median Remuneration of all employeeswho were on the payroll of the Company and the percentage increase in remuneration of theDirectors during the financial year 2015-16 are given below:
|Directors ||Ratio to Median ||Percentage Increase in Remuneration |
|NIL ||NIL ||NIL |
Secretarial Audit Report
A Secretarial Audit Report given by M/s Milind Nirkhe & Associates a companysecretary in practice shall be annexed with the report.
The Following Qualifications have been observed by the secretarial Auditor during theAudit Period.
Directors Reply on the qualifications in Secretarial Audit Report are as follows:
(i) The company is in the process of re-organizing its internal records so as to haveproper disclosures at any given point i of time;
(ii) the Company is in the process of developing its web site;
(iii) the Company has been searching for the suitable candidate to be appointed as aCompany Secretary and Chief Financial Officer.
29. Corporate Governance Certificate
Your Company has implemented all the mandatory requirements pursuant to ListingRegulations. A separate report on Corporate Governance is given as a part of the AnnualReport along with the certificate received from the Practicing Company Secretary M/s.Milind Nirkhe & Associates Company Secretaries confirming the compliance
30. Risk Management Policy
A statement indicating development and implementation of a risk management policy forthe Company including identification therein of elements of risk if any which in theopinion of the Board may threaten the existence of the company.
31. Directors' Responsibility Statement
In terms of the provisions of Section 134 (3) (c) and 134 (5) of the Companies Act2013 and to the best of their knowledge and belief and according to the information andexplanations obtained by them and same as mentioned elsewhere in this Report the attachedAnnua! Accounts and the Auditors' Report thereon your Directors confirm that:
(i) in the preparation of the annual accounts the applicable accounting standards havebeen followed and that there are no material departures;
(ii) 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 fairview of the state of affairs of the Company at the end of the financial year and of theprofit of the Company for that period;
(iii) they have taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of the Act for safeguarding theassets of the Company and for preventing and detecting fraud and other irregularities;
(iv) they have prepared the annual accounts on a going concern basis;
(v) they have laid down internal financial controls to be followed by the Company andthat such internal financial controls are adequate and are operating effectively.
(vi) they have devised proper systems to ensure compliance with the provisions of allapplicable laws and that such systems are adequate and operating effectively.
An acknowledgement to all with whose help cooperation and hard work the Company isable to achieve the results.
| ||By Order of the Board of Directors |
| ||For Haria Apparels Limited |
|Date: 30/05/2016 ||KANTILAL LAKHAMSHI HARIA |
|Place: Mumbai ||Chairman |
| ||DIN No. 00585400 |