Your Directors have pleasure in presenting the Forty Seventh Annual Report of theCompany together with the Audited Statement of Accounts for the Financial Year ended March31 2017.
FINANCIAL HIGHLIGHTS (Standalone):
|Particulars ||Financial Year ended |
| ||31st March 2017 ||31st March 2016 |
|Total Income ||2044423 ||1309145 |
|Expenditure ||2476169 ||2344751 |
|Profit before Depreciation Finance Charges and Tax ||(431746) ||(1035606) |
|Interest and Finance Charges ||NIL ||NIL |
|Depreciation ||NIL ||NIL |
|Profit before Tax ||(431746) ||(1035606) |
|Taxes paid and provided ||2210 ||NIL |
|Profit after Tax ||(433956) ||(1035606) |
|Transferred to Reserves ||NIL ||NIL |
|Proposed Final Dividend ||NIL ||NIL |
|Dividend distribution tax ||NIL ||NIL |
|Balance (credit/debit) to be carried to balance sheet ||(433956) ||(1035606) |
Revenue from operations during the year is Rs.0.20 Cr as compared to previous yearRs.0.13 Cr. The Company has suffered a Loss during the year is Rs.0.04 Cr as Compared toLast Year s Loss of Rs.0.10 Cr.
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. 2016-2017.
TRANSFER TO RESERVES:
The Company has not transferred any amount to the Reserves during the Year underReview.
The Company has not issued non-convertible debt securities it is not applicable tothem.
The paid up Equity Share Capital as on March 31 2017 was 115500000/- During theyear under review the Company has not issued any shares. The Company has not issuedshares with differential voting rights. It has neither issued employee stock options norsweat equity shares and does not have any scheme to fund its employees to purchase theshares of the Company.
RELATED PARTY TRANSACTIONS:
All Related Party Transactions that were entered into during the financial year were onan arm s length basis in the ordinary course of business and were in compliance with theapplicable provisions of the Companies Act 2013 ( the Act ) and the Securities AndExchange Board Of India (Listing Obligations And Disclosure Requirements) Regulations2015. There were no materially significant Related Party Transactions made by the Companyduring the year.
All Related Party Transactions are placed before the Audit Committee for approval. Astatement of all Related Party Transactions is placed before the Audit Committee for itsreview on a quarterly basis specifying the nature value and terms and conditions of thetransactions
Your Company has adopted a Risk Management Policy/ Plan in accordance with theprovisions of the Companies Act 2013 and Listing Regulations. It establishes variouslevels of accountability and overview within the Company while vesting identifiedmanagers with responsibility for each significant risk.
The Company has laid down procedures to inform the Audit Committee as well as the Boardof Directors about risk assessment and management procedures and status.
This risk management process covers risk identification assessment analysis andmitigation. Incorporating sustainability in the process also helps to align potentialexposures with the risk appetite and highlights risks associated with chosen strategies.
Your Company s Board comprises of 5 Directors with considerable experience in theirrespective fields. Of these 2 are Executive Directors and 3 Non Executive (Independent)Directors. The Chairman of the Board is an Executive Director.
APPOINTMENT OF DIRECTORS:
In accordance with the provisions of the Companies Act 2013 and the Company s Articlesof Association Mr. Kantilal Lakhamshi Haria Managing Director DIN NO: 00585400 retiresby rotation and being eligible offer himself for reappointment. Directors recommend hisre-appointment.
At the Annual General Meeting of the Company to be held on September 28 2017 theapproval of the Members is sought for appointment of Mr. Utsav Jaisukh Maru DIN No:07752233 as Joint Managing Director designated as Chief Financial
Officer & Ms. Nehaben Joy Kothari DIN NO: 07543569 as Independent Directors for aterm of five years w.e.f. 1st April 2017 & 30th March 2017 respectively.
The Company has received declarations from all the Independent Directors of the Companyconfirming that they meet with the criteria of Independence as prescribed both undersub-section (6) of Section 149 of the Companies Act 2013 and Regulation 16 (1) (b) of theListing Regulations.
In the opinion of the Board they fulfil the conditions of independence as specified inthe Act and the Rules made there under and are independent of the management.
In terms of the provisions of Section 149 of the Companies Act 2013 and Regulation 17of the Listing Regulations a company shall have at least one Woman Director on the Boardof the Company. Your Company has appointed Ms. Nehaben Joy Kothari DIN NO: 07543569 as anAdditional Director on the Board w.e.f March 30 2017 who holds office till the date ofthis AGMin respect of whom the Company has received a notice in writing under Section 160of the Companies Act 2013 from a member proposing her candidature for the office ofDirector. Accordingly the approval of shareholders is being sought for her appointment asan Independent Director of the Company.
APPOINTMENTS/RESIGNATIONS OF THE KEY MANAGERIAL PERSONNEL:
The Board had approved the appointment of Mr. Utsav Jaisukh Maru DIN No: 07752233 asJoint Managing Director designated as Chief Financial Officer of the Company for a periodof 5 (five) years with effect from 1st April 2017 and appointment of Ms. Nehaben JoyKothari DIN NO: 07543569 as an Independent Director of the Company w.e.f. 30th March2017.
Mr. Manish Kantilal Haria Din NO 0585234 has tender his resignation as ManagingDirector designated as Chief Financial Officer of the Company w.e.f March 31st 2017 andMrs. Kamala Kantilal Haria Din No 07543569 has tendered her resignation as women andindependent Director w.e.f. 31st March2017.
BOARD AND COMMITTEE MEETINGS:
Your Company s Board of Directors met Seven times during the financial year underreview. A calendar of Meetings is prepared and circulated in advance to your Directors.
Audit Committee of the Company as constituted by the Board is headed by Mr. NitinVasudev OzaMr. Mohith Ramamurthy Suddala and Mr. Manish Kantilal Haria as Members till29th March2017 and thereafter the new Audit committee is formed consequent to change inthe composition of the Board which is headed by Mr. Nitin Vasudev OzaMr. MohithRamamurthy Suddala and Mr. Utsav Jaisukh Maru as Members. There have not been anyinstances during the year when recommendations of the Audit Committee were not accepted bythe Board. All the recommendations made by the Audit Committee were accepted by the Board.
Details of the composition of the Board and its Committees and of the Meetings held andattendance of the Directors at such Meetings are provided in the Corporate GovernanceReport. The intervening gap between the Meetings was within the period prescribed underthe Act and the Listing Regulations.
PROCEDURE FOR NOMINATION AND APPOINTMENT OF DIRECTORS:
The Nomination and Remuneration Committee is responsible for developing competencyrequirements for the Board based on the industry and strategy of the Company. Boardcomposition analysis reflects in-depth understanding of the Company including itsstrategies environment operations and financial condition and compliance requirements.
The Nomination and Remuneration Committee conducts a gap analysis to refresh the Boardon a periodic basis including each time a Director s appointment or re-appointment isrequired. The Committee is also responsible for reviewing and vetting the resume ofpotential candidate s vis--vis the required competencies and meeting potentialcandidates prior to making recommendations of their nomination to the Board. At the timeof appointment specific requirements for the position including expert knowledgeexpected is communicated to the appointee.
CRITERIA FOR DETERMINING QUALIFICATIONS POSITIVE ATTRIBUTES AND INDEPENDENCE OF ADIRECTOR:
The Nomination and Remuneration Committee has formulated the criteria for determiningqualifications positive attributes and independence of Directors in terms of provisionsof Section 178 (3) of the Act and Regulation 19 read with Part D of Schedule II of theListing Regulations.
Independence: In accordance with the above criteria a Director will be considered asan Independent Director if he/ she meets with the criteria for Independent Director aslaid down in the Companies Act 2013 and Regulation 16 (1) (b) of the Listing Regulations.
Qualifications: A transparent Board nomination process is in place that encouragesdiversity of thought experience knowledge perspective and gender. It is also ensuredthat the Board has an appropriate blend of functional and industry expertise. Whilerecommending the appointment of a Director the Nomination and Remuneration Committeeconsiders the manner in which the function and domain expertise of the individual willcontribute to the overall skill-domain mix of the Board.
Positive Attributes: In addition to the duties as prescribed under the Companies Act2013 the Directors on the Board of the Company are also expected to demonstrate highstandards of ethical behaviour strong interpersonal skills and soundness of judgment.Independent Directors are also expected to abide by the Code for Independent Directors asoutlined in Schedule IV to the Act.
ANNUAL EVALUATION OF BOARD PERFORMANCE AND PERFORMANCE OF ITS COMMITTEES AND OFDIRECTORS:
Pursuant to the provisions of the Companies Act 2013 and Listing Regulations theBoard had carried out evaluation of its own performance performance of the Directors aswell as the evaluation of the working of its Committees.
The Nomination and Remuneration Committee has defined the evaluation criteriaprocedure and time schedule for the Performance Evaluation process for the Board itsCommittees and Directors.
The Board s functioning was evaluated on various aspects including inter aliastructure of the Board including qualifications experience and competency of Directorsdiversity in Board and process of appointment; Meetings of the Board including regularityand frequency agenda discussion and dissemination of information; functions of theBoard including strategy and performance evaluation corporate culture and valuesgovernance and compliance evaluation of risks grievance
Redressal for investors stakeholder value and responsibility conflict of interestreview of Board evaluation and facilitating Independent Directors to perform their roleeffectively; evaluation of management s performance and feedback independence ofmanagement from the Board access of Board and management to each other succession planand professional development; degree of fulfilment of key responsibilities establishmentand delineation of responsibilities to Committees effectiveness of Board processesinformation and functioning and quality of relationship between the Board and management.
Directors were evaluated on aspects such as attendance and contribution at Board/Committee Meetings and guidance/ support to the management outside Board/ CommitteeMeetings. In addition the Chairman was also evaluated on key aspects of his roleincluding setting the strategic agenda of the Board encouraging active engagement by allBoard members and motivating and providing guidance to the Managing Director & CEO.
Areas on which the Committees of the Board were assessed included degree of fulfilmentof key responsibilities adequacy of Committee composition and effectiveness 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.
Your Company has adopted a Remuneration Policy for the Directors Key ManagerialPersonnel and Senior Management pursuant to the provisions of the Act and ListingRegulations.
The philosophy for remuneration of Directors Key Managerial Personnel of the Companyis based on the commitment of fostering a culture of leadership with trust. TheRemuneration Policy of the Company is aligned to this philosophy.
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 Management involvesa balance between fixed and incentive pay reflecting short and long-term performanceobjectives appropriate to the working of the Company and its goals.
Details of the Remuneration Policy are given in the Corporate Governance Report.
LISTING OF SHARES:
Your Company s shares are listed on the BSE Limited. The Company has paid the listingfees for the year 2016 2017.
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.
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.
INTERNAL FINANCIAL CONTROLS:
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.
CORPORATE SOCIAL RESPONSIBILITY:
As a socially responsible Company your Company has a strong sense of communityresponsibility. The Company however does not fall within the Criteria as laid down by theAct is not required to constitute a CSR Committee. Further the Company has been sufferinga loss for the Last two Years; hence the Company has not formulated any Policy.
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 Policy aims to provideprotection to employees at the workplace and prevent and redress complaints of sexualharassment and for matters connected or incidental thereto with the objective ofproviding a safe working environment where employees feel secure. The Company has alsoconstituted an Internal Complaints Committee to inquire into complaints of sexualharassment and recommend appropriate action. The Company has not received any complaint ofsexual harassment during the financial year 2017-18.
VIGIL MECHANISM/ WHISTLE BLOWER POLICY:
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.
SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS:
No significant material orders have been passed by the Regulators or Courts orTribunals which would impact the going concern status of the Company and its futureoperations.
KANAK RATHOD & CO Statutory Auditors of the Company hold office until theconclusion of the ensuing Annual General Meeting and being eligible to offer themselvesfor re-appointment.
M/s KANAK RATHOD & CO have furnished a certificate confirming that ifre-appointed their re-appointment will be in accordance with Section 139 read withSection 141 of the Act. Pursuant to the provisions of the Act and the Rules made thereunder it is proposed to appoint M/s KANAK RATHOD & CO; as the statutory auditors ofthe Company from the conclusion of the forthcoming AGM till the conclusion of the 51stAnnual General Meeting to be held in 2021 subject to ratification at every subsequentAnnual General Meeting held after this Annual General Meeting.
Members are requested to consider the re-appointment of M/s KANAK RATHOD & 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 the Board of Directors of the Companyhad appointed CS. Milind Nirkhe Practicing Company Secretary (Proprietor) Practicingunder the name & style M/S Milind Nirkhe & Associates CP No: 2312 to undertakethe Secretarial Audit of the Company for the year ended 31st March 2017. The SecretarialAudit Report is annexed as Annexure. The Secretarial Audit Report for the Financial Yearended March 31 2017 contain certain qualification reservation adverse remark ordisclaimer & which are suitably replied by the Board in their Report.
The Company is engaged in the business of trading of Engineering of Goods the followingfalls under table C under the CETA Heading 7323. However Since the Overall turnover ofthe Company is neither rupees 100 crores nor more and nor is the Turnover rupees 35 crorefrom individual products during the Year thus it was not required to appoint a CostAuditor during the Year.
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION FOREIGN EXCHANGE EARNINGS AND OUTGO:
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 |
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 of Managerial 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 2016-17 are given below:
|Directors ||Ratio to Median ||Percentage Increase in Remuneration |
|NIL ||NIL ||NIL |
EXTRACT OF ANNUAL RETURN:
Pursuant to Section 92 (3) of the Act and Rule 12 (1) of The Companies (Management andAdministration) Rules 2014 the extract of Annual Return in form MGT.9 is annexed asAnnexure I.
Comments made by the Statutory Auditors in the Auditors Report are self- explanatoryand do not require any further clarification.
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 attachedAnnual 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 forthe maintenance of adequate accounting records in accordance with the provisions of theAct for safeguarding the assets of the Company and for preventing and detecting fraud andother 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. theyhave devised proper systems to ensure compliance with the provisions of all applicablelaws 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 EXPORT LIMITED |
|Place : MUMBAI ||KANTILAL LAKHAMSHI HARIA |
|Date : 30/05/2017 ||CHAIRMAN |
| ||DIN No. 00585400 |