You are here » Home » Companies » Company Overview » Kanco Enterprises Ltd

Kanco Enterprises Ltd.

BSE: 590084 Sector: Industrials
NSE: N.A. ISIN Code: INE248D01011
BSE LIVE 12:22 | 16 Aug 0.55 -0.02
(-3.51%)
OPEN

0.55

HIGH

0.55

LOW

0.55

NSE 05:30 | 01 Jan Stock Is Not Traded.
OPEN 0.55
PREVIOUS CLOSE 0.57
VOLUME 1261
52-Week high 1.64
52-Week low 0.55
P/E
Mkt Cap.(Rs cr) 1
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.55
Sell Qty 713.00
OPEN 0.55
CLOSE 0.57
VOLUME 1261
52-Week high 1.64
52-Week low 0.55
P/E
Mkt Cap.(Rs cr) 1
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.55
Sell Qty 713.00

Kanco Enterprises Ltd. (KANCOENTERP) - Director Report

Company director report

Dear Shareholders

Your Directors present their Twenty Fifth Annual Report and Audited Accounts for theperiod ended 31st March 2016.

FINANCIALS

Your Company’s financial performance was as follows :

Rs/lacs

Particulars 31.03.2016 30.09.2014
Profit before Interest Depreciation and Tax (74.07) 318.61
Less : Interest 1426.50 930.81
Gross (Loss) for the Year (1500.57) (612.20)
Less : Depreciation 431.69 373.32
(Loss) Before Tax (1932.26) (985.52)
Less : Provision for Tax - -
(Loss) After Taxation (1932.26) (985.52)
Depreciation transferred on account of change in useful life of Property Plant and Equipment (113.40)

-

Balance Brought Forward from last Account (7631.01) (6645.49)
Balance Carried to Balance Sheet (9676.67) (7631.01)

RESULTS OF OPERATIONS AND THE STATE OF THE COMPANY’S AFFAIRS

Yarn prices were under pressure throughout the year in view of supply exceeding demandlargely due to capacity addition in cotton spinning sector. Yarn prices moved downwardsfrom an average of Rs 192/- per Kg. in October 2014 to an average of Rs 170/- per Kg. inSeptember 2015. Raw material prices moved up from an average of Rs 33500/- per candy inOctober 2014 to Rs 35000/- per candy in September 2015.

The addition in capacity was a result of incentives given by various state governments.The cost advantage to new units and lacklustre international demand put tremendouspressure on margins with older units struggling to survive the competition.

The Company was forced to suspend manufacturing operations from September 30 2015 inview of large scale resignations of staff and workmen at the Company's factory situated at"Kanco Overseas" Village: Walthera Taluka: Dholka Ahmedabad 387810 and hasdecided to continue the same in view of overall negative outlook of the Textile Industry.The management is watching the developments and will take appropriate decision as and whenthe markets improve and the supply / demand mis-match is bridged.

The current period operations have resulted in a net loss of Rs 1932.26 lacs.

FINANCE

During the year under review the long term borrowings and short term borrowings of theCompany stands at Rs 434.35 Lakhs and Rs 1937.88 Lakhs respectively as on 31st March 2016.

CHANGE IN FINANCIAL YEAR

In compliance with the provisions of Section 2(41) of the Companies Act 2013 withregard to Financial Year which has been notified w.e.f. 01/04/2014 the Board of Directorsdecided to change the current Financial Year of the Company from 1st October 2014 to 30thSeptember 2015 to 1st October 2014 to 31st March 2016 so as to align it with therequirements of the Act. The Registrar of Companies Kolkata has approved theCompany’s request for extension of Annual General Meeting by 3 months. The subsequentfinancial years of the Company shall be from 1st day of April to 31st March.

DIVIDEND

The Directors of your Company do not recommend any dividend for the period underreview.

EXTRACT OF ANNUAL RETURN

The details forming part of the extract of the Annual Return in Form No. MGT-9 asrequired under Section 92 of the Companies Act 2013 is annexed herewith marked asAnnexure A to this report.

REFERENCE TO THE BOARD OF INDUSTRIAL AND FINANCIAL RECONSTRUCTION

The accumulated losses of the Company for the period ended March 312016 have resultedin erosion of 100% of its peak net worth in the current year. The Company’s referencebearing no.06/2013filed with Board for Industrial and Financial Reconstruction underSection 15(1) of the Sick Industrial Companies (Special Provisions) Act 1985 for the yearended 30th September 2012 is still pending and therefore the Board has decided not tofile any fresh reference under Section 15(1) of the Sick Industrial Companies (SpecialProvisions) Act 1985 in the current year.

The Company’s appeal under section 25(1) of the Sick Industrial Companies (SpecialProvisions) Act1985 against the order passed by the BIFR for reference no.3/2012 filedu/s 15(1) of the SICA1985 on 13/01/2012 is also pending.

DIRECTORS

Mr. Susanta Banerjee (DIN:01173116) Director of the Company retires by rotation atthe ensuing Annual General Meeting and being eligible offers himself for re-appointment.

The Central Government has approved the reappointment of Mr. Umang Kanoria (DIN:00081108) as the Managing Director of the Company for a period of three years with effectfrom 1st January 2015 to 31st December 2017.

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 read with the Companies(Appointment and Qualification of Directors) Rules 2014 and the Securities and ExchangeBoard of India (Listing Obligations and Disclosure Requirements) Regulations 2015.

The Company has devised a Policy for Performance evaluation of Independent DirectorsBoard Committees and other Individual Directors which includes criteria for performanceevaluation of the non-executive directors and executive directors and is annexed herewithmarked as Annexure B to this report.

The performance evaluation of the Chairman and the non-independent Directors wascarried out by the Independent Directors. On the basis of the Policy the PerformanceEvaluation of Independent Directors Board Committees and other individual Directors werecarried. The Board of Directors expressed their satisfaction with the evaluation process.Mr. Atul Doshi has tendered his resignation from the directorship of the Company witheffect from 27th November 2014 due to his preoccupation and inability to devote time todischarge his responsibilities. The Board of Directors in their meeting took note of thesame and placed their appreciation of the valuable contribution made by him.

POLICY ON DIRECTORS’APPOINTMENT REMUNERATION ETC

Pursuant to Section 178(3) of the Companies Act 2013 Nomination and RemunerationCommittee has formulated the criteria for identification and selection of the suitablecandidates for various positions in senior management and also candidates who arequalified to be appointed as director on the Board of the Company. The Committee alsorecommended a policy relating to the remuneration for the directors key managerialpersonnel and other senior management personnel and a process by which the performance ofthe directors could be evaluated and the same is annexed herewith marked as Annexure B tothis report.

KEY MANAGERIAL PERSONNEL

The following persons are the Key Managerial Personnel (KMP) of the Company incompliance with the provisions of Section 203 of the Companies Act 2013:

a) Mr. U. Kanoria (DIN:00081108) Managing Director

b) Ms. Charulata Kabra Company Secretary (resigned w.e.f. 16/11/2015)

c) Ms. Anupama Goel Company Secretary (w.e.f. 14/05/2016)

d) Mr. S. V Tewary Chief Financial Officer

NUMBER OF MEETINGS OF THE BOARD

Six meeting of the Board of Directors were held during the year.

AUDIT COMMITTEE

The Audit Committee comprises of Independent Directors namely Ms. Puja Borar(Chairperson) and Mr. Krishna Kumar Gupta and Mr. Susanta Banerjee Non-ExecutiveDirector. All the recommendations made by the Audit Committee were accepted by the Board.

DIRECTORS' RESPONSIBILITY STATEMENT

The Directors hereby confirms that:

a) in the preparation of the annual accounts the applicable accounting standards readwith requirements set out under Schedule III to the Act have been followed and there areno material departures from the same;

b) they had selected such accounting policies and applied them consistently and madejudgements and estimates that are reasonable and prudent so as to give a true and fairview of the state of affairs of the Company as at 31st March 2016 and of the loss of theCompany for the period ended on that date;

c) they had taken proper and sufficient care for the maintenance of adequate accountingrecords in accordance with the provisions of the Act for safeguarding the assets of theCompany and for preventing and detecting fraud and other irregularities;

d) they had not prepared the annual accounts on a going concern basis;

e) they had laid down internal financial control to be followed by the Company and thatsuch internal financial controls are adequate and were operating effectively; and

f) they had devised proper systems to ensure compliance with the provisions of allapplicable laws and that such systems were adequate and operating effectively.

STATUTORY AUDITORS

Messrs B. R. Shah & Associates Chartered Accountants(Registration No.129053W)Statutory Auditors of the Company hold office till the conclusion of the ensuing AnnualGeneral Meeting and are eligible for re-appointment. They have expressed their willingnessto continue as Statutory Auditors of the Company if so appointed by the members. YourCompany has received the consent and certificate from Messrs. B. R. Shah & AssociatesChartered Accountants to the effect that their re-appointment if made would be within thelimits prescribed under Section 141 of the Companies Act 2013 read with rules and thatthey are not disqualified for reappointment within the meaning of Section 141 of theCompanies Act 2013. They have also confirmed that they hold a valid peer reviewcertificate as prescribed under regulation 33(1)(d) of the Securities and Exchange Boardof India (Listing Obligations and Disclosure Requirements) Regulations 2015.

STATUTORY AUDITORS’ REPORT

The Auditors’ have qualified their Report and the explanation in this regard formspart of the Directors’ Report. Qualified Opinion

(a) As referred to in note no. 24(2) (a) (i) (b) of financial statements during theyear ended September 30 2012 the Company has not accounted for Foreign Exchange loss ofRs 117881338/- arising out of Cancellation of Forward Contract and disclosed the sameas contingent liability. On account of this accumulated loss as at March 31 2016 islower by the said amount. The loss above does not include interest if any.

During the year ended September 30 2012 State Bank of India (SBI) has unilaterallycancelled the forward contracts and debited Rs 117881338/- being the losses on accountof foreign exchange difference excluding interest if any into our cash credit accountwithout any authorization from us. The Company is not in agreement

with the action taken by the SBI and has lodged its objection with SBI. The Companyfiled a suit in Hon'ble Court at Calcutta on 6th day of August 2013 against State Bank ofIndia and therefore disputes the forex losses. The said suit has been transferred to theCity Civil Court in Ahmedabad pursuant to the order dated 18th day of August 2014 ofCalcutta High Court. The Company therefore has not recognized the said forex loss in itsbooks of accounts. The dispute is sub-judice.

(b) As referred in note no. 7 (iii) & (iv) Company has stopped repaying Securedloan and interest thereon to State Bank of India and IDBI Bank since 2011-2012. Interestcharged on borrowing from State Bank of India has been accounted as per last agreed rateof2011-2012. We have been explained that the Company has no information about any changein the rate of interest so impact if any of the same in statement of profit and lossand Reserve and Surplus is not determinable. The said loans have been recalled by therespective lenders and matter is sub- judice.

Company has stopped repaying Secured loan and interest thereon to State Bank of Indiaand IDBI Bank since 2011-2012. Interest charged on borrowing from State Bank of India hasbeen accounted as per last agreed rate of 2011-2012. We have been explained that theCompany has no information about any change in the rate of interest so impact if any ofthe same in Statement of Profit and Loss and Reserve and Surplus is not determinable. Thesaid loans have been recalled by the respective lenders and matter is sub-judice.

(c) As referred in note no. 5(ii) balance of secured loan and Interest thereon fromState Bank of India and IDBI Bank are as per books of accounts and subject to confirmationby lenders.

Both SBI and IDBI have neither sent any statement of account nor issued any balanceconfirmation and therefore the management is unable to get the confirmation.

(d) As referred in note no. 6 (2) the Company has not made provision for interest fordelayed in payment to vendors during the period as per agreed terms with vendors. AlsoTrade Payables are subject to confirmations. Consequently we were unable to determinewhether any adjustments to these amounts were necessary.

As per the understanding reached with vendors the Company has decided not to provideany interest on delayed payment due to financial constraints and closure of operation andduring the year no such bill for interest has been raised by the vendors. Further nolegal action has also been taken by the vendors for not providing interest on delayedpayment. The trade payable has been reduced from ^^73817338/- in September 2014 to Rs9629234/- in March 2016.

(e) As referred in note no. 13 (2) the Company has valued stores and spares at cost.Impact if any for net realisable being lower than the cost could not be determined.

The Stores & Spares as on 31st March 2016 is Rs 6564410/- and Company has valuedit at cost as it’s difficult to ascertain the realisable value of such a large numberof store items and difference if any between realizable value and cost value won’tbe material.

(f) As referred in note no. 24 (2) (j) the company has not provided interest for theperiod from April 12015 to March 312016 on unsecured intercorporate loan of Rs43434766/- from related party and unsecured loan of Rs 15000000/- received fromnon-related party. Amount of the Interest for the said period on the said loan as per lastagreed rate with the parties is Rs 5725768/-.

The Company has shut down its operation in September 2015 and lenders have recalledthe loan and the loan accounts have been declared NPA. The Company is facing acuteliquidity crunch and therefore unable to make any payment to its lenders at the moment andtherefore no interest has been provided on unsecured loans.

SECRETARIAL AUDIT REPORT

Pursuant to the provisions of Section 204 of the Companies Act 2013 and The Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 the Company hasappointed A. K. Labh & Co. a firm of Company Secretaries in Practice to undertake theSecretarial Audit of the Company. The Report of the Secretarial Auditor is annexedherewith marked as Annexure C to this report.

The Secretarial Auditor has submitted his report with observations the explanations towhich are as under:

a) The Company could not comply with the requirement pertaining to publication ofUnaudited Financial Results for the quarter ended 30th September 2015 and 31st December2015 pursuant to Regulation 33 of the Securities and Exchange Board of India (ListingObligations and Disclosure Requirements) Regulations 2015 because large scale resignationtook place during September 2015 and all but 10 employees tendered resignation. TheCompany Secretary also submitted her resignation w.e.f. 16th November 2015. The resultscould not be published due to shortage of manpower and the same had been published on 30thMay 2016.

b) The Company has defaulted in repayment of the outstanding secured loans as it hassuffered huge losses due to external factors and overall depression in the industry overlast few years. The Company reference is pending before the Board for Industrial andFinancial Reconstruction (BIFR) and it is negotiating with bankers to reach an amicablesettlement.

PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS BY COMPANY

The Company has not made any investments.

The Company has neither given any loan & guarantee nor provided any securittyduring the period under review. CONTRACTS AND ARRANGEMENTS WITH RELATED PARTIES

The Company has not entered into any contracts / arrangements with related parties asdefined under Section 188 of the Companies Act 2013during the period under review.

MATERIAL CHANGES AND COMMITMENTS OCCURRED BETWEEN THE END OF THE FINANCIAL YEAR UNDERREVIEW AND THE DATE OF THIS REPORT

No material changes and commitments have occurred between the end of the financial yearunder review and the date of this report.

CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION FOREIGN EXCHANGE EARNINGS AND OUTGO

A statement pursuant to Section 134(3) (m) of the Companies Act 2013 read with Rule8(3) of the Companies (Accounts) Rules 2014 on conservation of energy technologyabsorption foreign exchange earnings and outgo is annexed herewith marked as Annexure Dto this report.

RISK MANAGEMENT

As per requirement of Section 134(3) (n) of the Companies Act 2013 the Board ofDirectors in its meeting held on 9th May 2014 has approved the Risk Management Policy.The Board envisaged the following elements of risks which may threaten the existence ofthe Company-

MARKET RELATED RISK

The price of raw material and finished goods of KEL are volatile in nature and goesthrough many ups and downs. KEL has decided that: -

a) The inventory level of raw material i.e. cotton stock will always be maintained at amaximum level of three months and minimum level of ten days. The exception for keepingstock at minimum level of ten days is during month of October and November during whichnew cotton crop comes in.

b) KEL cannot enter into more than three months forward sale without permission ofBoard of Directors.

c) Board of Directors has to be intimated if finished goods inventory touches two monthproduction figure.

d) The senior management of KEL gathers information from research report conducted byvarious agencies report published by Chambers/Association representing the IndustryStatistics published by Ministry of Textiles Government Policies and regulationsaffecting the Industry to arrive at appropriate decision to mitigate the risks on accountof volatility in prices of raw materials and finished goods.

RISK DUE TO FRAUD

KEL has installed adequate internal control measures to minimise the occurrence offraud and internal audit is also conducted at regular intervals by an external agency.

RISK OF DOUBTFUL AND BAD DEBT

The credit worthiness of sundry debtors is checked by the senior management to fix thecredit period if any to be given. The background check of new party is also carried outbefore deciding on the credit period.

DEPOSITS

During the period under review the Company has not accepted any deposits within themeaning of Section 73 of the Companies Act 2013 read with the Companies (Acceptance ofDeposits) Rules 2014.

MATERIAL ORDERS PASSED BY THE REGULATORS /COURTS/ TRIBUNALS

There are no significant and material orders passed by the regulators or courts ortribunals impacting the going concern status and Company’s operations in future.

INTERNAL CONTROLS

The Company has an effective Internal Control system with reference to FinancialStatements. The Audit Committee of the Board of Directors reviews the adequacy andeffectiveness of the Internal Control System. The Company’s Internal Control Systemis commensurate with its size scale and complexities of its operations.

VIGIL MECHANISM

The Company has a Vigil Mechanism / Whistle Blower policy to report genuine concernsand grievances. Protected disclosures can be made by a whistle blower through an email ordedicated telephone line or a letter to the Chairman of the Audit Committee. The policycan be viewed at : http://kanco.in/pdf/VIGIL%20MECHANISM_WHISTLE%20BLOWER.PDF

STOCK EXCHANGE

The Company’s equity shares are listed at the Calcutta Stock Exchange Limited(Scrip Code-10021381). The Company’s equity shares are traded at the Bombay StockExchange Limited (Scrip Code- 590084) as per MOU signed between CSE and BSE. Listing Feesfor the financial year 2016-2017 has been paid.

CORPORATE GOVERNANCE

The Corporate Governance provisions as stipulated under the Securities and ExchangeBoard of India (Listing Obligations and Disclosure Requirements) Regulations 2015 is notapplicable to the Company.

MANAGEMENT DISCUSSION AND ANALYSIS

Management Discussion and Analysis Report for the period under review as stipulatedunder Regulation 34(3) read with Schedule V of Securities and Exchange Board of India(Listing Obligations and Disclosure Requirements) Regulations 2015 is annexed herewithmarked as Annexure E to this report.

DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION PROHIBITIONANDREDRESSAL) ACT2013

No complaints have been received during the period under review by the respectiveInternal Complaints Committee.

Details pertaining to remuneration as required under Section 197(12) of the CompaniesAct 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014

(i) The percentage increase in remuneration of each Director Chief Financial Officerand Company Secretary during the financial year October 2014 - March 2016 ratio of theremuneration of each Director to the median remuneration of the employees of the Companyfor the financial year October 2014 - March 2016 and the comparison of remuneration ofeach Key Managerial Personnel (KMP) against the performance of the Company are as under:

Sl. No. Name of Director/ KMP and Designation Remuneration of Director/ KMP for F.Y October 2014- March 2016 (Rs In Lacs) % increase in Remuneration in the F.Y October 2014- March 2016 Ratio of remuneration of each Director to median remuneration of employees Comparison of the Remuneration of the KMP against the performance of the Company
1. Mr. Umang Kanoria Managing Director (refer note) 30.12 67.36% 35.29 The Loss before tax increased by 196% compared to previous year mainly due to extra ordinary circumstances prevailing in the industry wherein domestic and international demand was subdued and there was pressure on margin due to addition of huge capacity by new units which enjoys advantage due to various incentive and subsidy schemes of central and state government. The Company has paid fixed part of salary as per approval of Central Government.
2. Mr. Susanta Banerjee Non-Executive Director 0.50 25.00% 0.59 N.A.
3. Mr. Krishna Kumar Gupta Independent Director

0.40

Nil

0.47

N.A.

4. Ms. Puja Borar Independent Director 0.30 # 0.35 N.A.
5. Mr. S. V. Tewary Chief Financial Officer (refer note) 28.88 77.21% 33.83

The Loss before tax increased by 196% compared to previous year mainly due to extra ordinary circumstances prevailing in the industry wherein domestic and international demand was subdued and there was pressure on margin due to addition of huge capacity by new units which enjoys advantage due to various incentive and subsidy schemes of central and state government. The increase in salary is as per experience qualification market trends and industry bench mark.

6. Ms. Charulata Kabra Company Secretary (resigned w.e.f. 16.11.2015) (refer note) 9.07 36.93% 10.62

ii) The median remuneration of employees of the Company during the financial year wasRs 85356/-

iii) the percentage increase in median remuneration of the employees of the Company-18.51%

iv) Number of permanent employees on the rolls of the Company - 9

v) Explanation on the relationship between average increase in remuneration and companyperformance - The average increase in remuneration is 13.54%. The dip in profit isattributable to extra ordinary circumstances prevailing in the industry wherein domesticand international demand was subdued and there was pressure on margin due to addition ofhuge capacity by new units which enjoys advantage due to various incentive and subsidyschemes of central and state government. The increase in salary is as per agreement withworkers approval of central government markettrend and Industry bench mark.

vi) Comparison of the remuneration of the Key Managerial Personnel Against theperformance of the Company - The average increase in remuneration is 68.35%. Forexplanations please refer point v) above.

vii) Variations

a) In the market capitalisation of the Company - The market capitalisation as on March312016 was Rs 303.02 Lacs (f 485.91 as on September 30 2014)

b) The Price Earning Ratio of the Company is not reported as EPS is negative.

c) Percentage increase over decrease in the market quotations of the shares of theCompany in comparison to the rate at which the company came out with the last public offerin the year- Not Applicable.

viii) Average percentile increase already made in the last financial year

a) In the salaries of employees other than the managerial personnel -11.36%

b) Percentile increase in the managerial remuneration - 68.35%

c) Justification for such increase in remuneration & exceptional circumstances forincrease in the managerial remuneration - (Please refer point-v)

ix) Key parameters for any variable component of remuneration availed by the directors- Rs Nil for period under review.

x) Ratio of remuneration of the highest paid director to that of the employees who arenot directors but receive remuneration in excess of the highest paid director during theyear - Not applicable as there are no employees receiving higher remuneration than thehighest paid director.

xi) It is hereby affirmed that the remuneration paid to the directors key managerialpersonnel and other employees is as per the remuneration policy of the Company.

# Details not given as Ms.Puja Borar was not paid any sitting fees in previous period.

Note : The previous period figures are for twelve months whereas current period figureis for eighteen months. Large scale resignation took place in September 2015 and all butnine employees tendered resignation. On account of these factors the median presents adistorted picture and the figures are not comparable.

B. Rules 5(2) and 5(3) of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014 are not applicable.

Acknowledgement

Your Directors place on record their appreciation for the cooperation and supportextended by the Employees Banks/ Financial Institutions and all other business partners.

For and on behalf of the Board
Kolkata U. KANORIA
May 30 2016 Chairman & Mg. Director

Annexure A Form No. MGT-9

EXTRACT OF ANNUAL RETURN

As on the financial year ended on 31.03.2016

[Pursuant to Section 92(3) of the Companies Act 2013 and Rule 12(1) of the Companies(Management and Administration) Rules 2014]

I. REGISTRATION AND OTHER DETAILS:

(i) CIN : L51909WB1991PLC053283
(ii) Registration Date : 04.10.1991
(iii) Name of the Company : Kanco Enterprises Limited
(iv) Category / sub-category of the Company : Company limited by shares/ Non-Government Company
(v) Address of the Registered office and Contact details : Jasmine Tower 3rd Floor 31 Shakespeare Sarani
Kolkata 700 017 Telefax : 033-22815217
E mail Id: compliance@kanco.in/contact@kanco.in
(vi) Whether listed company Yes
(vii) Name Address and Contact details of Registrar and Transfer Agent if any : C. B. Management Services (P) Ltd.
P-22 Bondel Road Kolkata 700 019
Phone: 033 4011 6700; 2280 6692-94/2486
Fax : 033 2287 0263 Email id: rta@cbmsl.com

II. PRINCIPAL BUSINESS ACTIVITIES OF THE COMPANY

All the business activities contributing 10% or more of the total turnover of theCompany shall be stated:-

Sl.No. Name and Description of the main products / services NIC Code of the Product / service % of total turnover of the Company
1. Cotton Yarn 13111 99.49

III. PARTICULARS OF HOLDING SUBSIDIARY AND ASSOCIATE COMPANIES

Name& Address of the Company CIN Holding / Subsidiary/ Associate % of shares held* Applicable

Section

NOT APPLICABLE

IV. SHARE HOLDING PATTERN (Equity Share Capital Breakup as percentage of Total Equity)i'i) Category-wise Share Holding

Category of Shareholders

No. of Shares held at the beginning of the year (as on 01.10.2014)

No. of Shares held at the end of the year (as on 31.03.2016)

% Change during the year
Demat Physical Total % of Total Shares Demat Physical Total % of Total Shares
A. Promoters
1. Indian
(a) Individual /HUF 4008929 4008929 22.36 4008929 4008929 22.36
(b) Central Government
(c) State Government(s)
(d) Bodies Corporate 7186210 - 7186210 40.08 7191345 - 7191345 40.11 0.03
(e) Banks/Financial Institutions
(f) Any Other (specify) Sub-Total(A)(1) 11195139 - 11195139 62.44 11200274 - 11200274 62.47 0.03
2. Foreign
(a) NRIs - Individuals - - - - - - - - -
(b) Other-Individuals - - - - - - - - -
(c) Bodies Corporate - - - - - - - - -
(d) Banks/Financial Institutions
(e) Any Other (specify) - - - - - - - - -
Sub-Total(A)(2) - - - - - - - - -
Total Shareholding of Promoter and PromoterGroup (A)=(A)(1)+(A)(2) 11195139 11195139 62.44 11200274 11200274 62.47 0.03
B. Public Shareholding
(1) Institutions
(a) Mutual funds 52685 1498 54183 0.30 52685 1498 54183 0.30 -
(b) Banks/FI - 1300 1300 0.01 - 1300 1300 0.01 -
(c) Central Govt / State Govt(s) 14976 14976 0.08 14976 14976 0.08
(d) Venture Capital Funds
(e) Insurance Companies 102450 102450 0.57 100450 100450 0.56 (0.01)
(f) FIIs - - - - - - - -
(g) Foreign Venture Capital Funds
(h) Others (specify) - - - - - - - - -
Sub-Total (B)(1) 155135 17774 172909 0.96 153135 17774 170909 0.95 (0.01)

 

No. of Shares held at the beginning of the year (as on 01.10.2014)

No. of Shares held at the end oftheyear (as on 31.03.2016)

Category of Shareholders Demat Physical Total % of Total Shares Demat Physical Total % of Total Shares % Change during the year
(2) Non- Institutions
(a) Bodies Corporate
(i) Indian 2932016 14250 2946266 16.43 2938388 14250 2952638 16.47 (0.04)
(ii) Overseas - - - - - - - - -
(b) Individuals
(i) Individual shareholders holding nominal share capital upto K1 lakh 1129853 1017696 2147549 11.98 1144964 998365 2143329 11.95 (0.03)
(ii) Individual shareholders holding nominal share capital in excess of K1 lakh 1449182 1449182 8.08 1442806 1442806 8.05 (0.03)
(c) Others (specify) NRIs/OCBs 9988 5616 15604 0.09 769 5616 6385 0.03 (0.06)
Clearing Member 3725 - 3725 0.02 14033 - 14033 0.08 0.06
Sub-Total (B)(2) 5524764 1037562 6562326 36.60 5540960 1018231 6559191 36.58 (0.02)
Total Public Shareholding (B)=(B)(1)+(B)(2) 5679899 1055336 6735235 37.56 5694095 1036005 6730100 37.53 (0.03)
C. Shares held by Custodians for GDRs & ADRs
GRAND TOTAL (A)+(B)+(C) 16875038 1055336 17930374 100.00 16894369 1036005 17930374 100.00 -

(ii) Shareholding of Promoters

Shares holding at the beginning of the year

Shares holding at the end of the year

% Change in Shareholding during the year
SI. No. Name of the Shareholder No. of Shares % of total Shares of the Company % of Shares pledged/ encumbered to total Shares No. of Shares % of total Shares of the Company % of Shares pledged/ encumbered to total Shares
1 Umang Kanoria 4008929 22.36 - 4008929 22.36 - -
2 KancoTea & Industries Limited 3314291 18.48 - 3314291 18.48 17.21 -
3 B.T. Investments Private Limited 1528150 8.52 - 1528150 8.52 8.52 -
4. Cosmos Resources Private Limited 1326429 7.40 - 1326429 7.40 4.39 -
5. E.T. Resources Private Limited 422895 2.36 - 422895 2.36 - -
6. Nidhi Private Limited 310000 1.73 - 385075 2.15 - 0.42
7. Innova Properties Private Limited 120000 0.67 - 120000 0.67 - -
8. Facitcon Investments Private Limited 94505 0.53 - 94505 0.53 - -
9. OCL Investments & Leasing Limited 69940 0.39 - - - - (0.39)
TOTAL 11195139 62.44 - 11200274 62.47 30.12 0.03

i iii) Change in Promoters' Shareholding (Please specify if there is no change)

Sl No. Name of the Shareholder

Shareholding at the beginning of the year

Cumulative Shareholding during theyear

No. of Shares % of total Shares of the Company No. of Shares % of total Shares of the Company
1 Umang Kanoria
At the beginning of the year 4008929 22.36 4008929 22.36
Increase/Decrease - - - -
At the end of the year 4008929 22.36
2 Kanco Tea & Industries Limited
At the beginning of the year 3314291 18.48 3314291 18.48
Increase/Decrease - - - -
At the end of the year 3314291 18.48
3 B.T. Investments Private Limited
At the beginning of the year 1528150 8.52 1528150 8.52
Increase/Decrease - - - -
At the end of the year 1528150 8.52
4 Cosmos Resources Private Limited
At the beginning of the year 1326429 7.40 1326429 7.40
Increase/Decrease - - - -
At the end of the year 1326429 7.40
5 E.T. Resources Private Limited
At the beginning of the year 422895 2.36 422895 02.36
Increase/Decrease - - - -
At the end of the year 422895 02.36
6 Nidhi Private Limited
At the beginning of the year 310000 1.73 310000 1.73
Purchase of shares on 26.12.2014 69940 0.39 379940 2.12
Purchase of shares on 27.03.2015 5135 0.03 385075 2.15
At the end of the year 385075 2.15
7 Innova Properties Private Limited
At the beginning of the year 120000 0.67 120000 0.67
Increase/Decrease - - - -
At the end of the year 120000 0.67
8 Facitcon Investments Private Limited
At the beginning of the year 94505 0.53 94505 0.53
Increase/Decrease - - - -
At the end of the year 94505 0.53
9 OCL Investments & Leasing Limited
At the beginning of the year 69940 0.39 69940 0.39
Sale of shares on 19.12.2014 (69940) (0.39) - -
At the end of the year - -

(iv) Shareholding Pattern of Top Ten Shareholders (other than Directors Promoters andHolders of GDRs and ADRs):

Sl No. Particulars

Shareholding at the beginning of the year

Cumulative Shareholding during the year

Name of the Shareholder No. of Shares % of total Shares of the Company No. of Shares % of total Shares of the Company
1. Castle Fincon Private Limited
At the beginning of the year 850000 4.74 850000 4.74
Sale of shares as on 20.03.2015 (850000) (4.74) - -
At the end of the year - -
2. Southern Lease Finance Limited
At the beginning of the year 850000 4.74 850000 4.74
Purchase of shares as on 27.03.2015 1650000 9.20 2500000 13.94
At the end of the year

2500000

13.94

3. Ranisati Merchandise Private Limited
At the beginning of the year 800000 4.46 800000 4.46
Sale of shares as on 20.03.2015 (800000) (4.46) - -
At the end of the year - -
4. Deepa Bagla
At the beginning of the year 319404 1.78 319404 1.78
Purchase/Sale - - - -
At the end of the year 319404 1.78
5. Dheeraj Kumar Lohia
At the beginning of the year 261570 1.46 261570 1.46
Purchase/Sale - - - -
At the end of the year 261570 1.46
6. Raj Kumar Lohia
At the beginning of the year 237087 1.32 237087 1.32
Purchase/Sale - - - -
At the end of the year 237087 1.32
7. Wind Power Vinimay Private Limited
At the beginning of the year 208951 1.17 208951 1.17
Sale of shares as on 04.12.2015 (620) (0.00) 208331 1.16
Purchase of shares as on 25.12.2015 250 0.00 208581 1.16
Sale of shares as on 04.03.2016 (208581) (1.16) - -
At the end of the year - -
8. Sevanti Lal Anoopchand Shah
At the beginning of the year 95001 0.53 95001 0.53
Purchase/Sale - - - -
At the end of the year 95001 0.53
9. Apurva Consulants Private Limited
At the beginning of the year 60000 0.33 60000 0.33
Purchase/ Sale - - - -
At the end of the year 60000 0.33
10. Kailash Chandra Dhanuka
At the beginning of the year 59257 0.33 59257 0.33
Purchase of shares as on 12.12.2014 760 0.00 60017 0.33
Sale of shares as on 29.05.2015 (10600) (0.06) 49417 0.28
Sale of shares as on 05.06.2015 (33417) (0.19) 16000 0.09
Sale of shares as on 05.06.2015 (16000) (0.09) - -
At the end of the year

-

-

(v) Shareholding of Directors and Key Managerial Personnel:

SI No. Particulars

Shareholding at the beginning of the year

Cumulative Shareholding during theyear

Name of the Directors/Key Managerial Personnel No. of Shares

% of total Shares of the Company

No. of Shares % of total Shares of the Company
DIRECTORS
1. Susanta Baneriee
At the Beginning of the year 65 0.00 65 0.00
Purchase/Sale - - - -
At the end of the year 65 0.00
2. Krishna Kumar Gupta
At the Beginning of the year - - - -
Purchase/Sale - - - -
At the end of the year - -
3. Puia Borar
At the Beginning of the year - - - -
Purchase/Sale - - - -
At the end of the year - -
KEY MANAGERIAL PERSONNEL
1. Umang Kanoria
At the Beginning of the year 4008929 22.36 4008929 22.36
Purchase/Sale - - - -
At the end of the year 4008929 22.36
2. Sushil VishwakantTewary
At the Beginning of the year 600 0.00 600 0.00
Purchase/Sale - - - -
At the end of the year 600 0.00
3. Charulata Kabra
At the Beginning of the year - - - -
Purchase/Sale - - - -
Uptothe 16.11.2015 - -- -

V. INDEBTEDNESS

Indebtedness of the Company including interest outstanding/accrued but not due forpayment

Secured Loans excluding deposits Secured Loans excluding deposits Unsecured Loans Total Indebtedness
Indebtedness at the beginning of the financial year
(i) Principal Amount 373892836 121434766 495327602
(ii) Interest due but not paid 179070999 4379955 183450954
Total (i+ii) 552963835 125814721 678778556
Change in Indebtedness during the financial year
Addition - (14000000) (14000000)
Reduction 124162660 4222825 128385485
Net Change 124162660 (9777175) 114385485
Indebtedness at the end of the financial year
(i) Principal Amount 373892836 107434766 481327302
(ii) Interest due but not paid 303233659 8602780 311834439
Total (i+ii) 677126195 116037546 793164041

VI. REMUNERATION OF DIRECTORS AND KEY MANAGERIAL PERSONNEL A. Remuneration to Wholetime Director :

SI. No. Particulars of Remuneration Name of Managing Director Umang Kanoria Total Amount^)
1. Gross Salary
(a) Salary as per provisions contained in Section 17(1) of the Income-tax Act 1961 2775000
(b) Value of perquisites u/s 17(2) of the Income-tax Act 1961 237500
(c) Profits in lieu of salary under Section 17(3) ofthe Income-taxAct 1961 -
2. Stock Option -
3. Sweat Equity -
4. Commission
- as % of profit -
- others specify -
5. Others please specify -
Total (A) (This includes Rs 312500/- which is excluded under Schedule V to the Companies Act 2013 for calculation of ceiling. The remuneration as per Schedule V to the Companies Act 2013 is Rs 2700000/-) 3012500
Ceiling as per the Act 3000000

B. Remuneration of other Directors :

Sl. Particulars of Remuneration

Name of Directors

Total Amount
No. Puja Borar Krishna Kumar Gupta
1. Independent Directors
Fee for attending Board/ Committee meetings 30000 40000 70000
Commission - - -
Others (please specify) - - -
Total(1) 30000 40000 70000
2. Other Non-Executive Directors

Susanta Banerjee

Fee for attending Board/ Committee meetings 50000 50000
Commission - -
Others (please specify) - -
Total(2) 50000 50000
Total (B)= (1+2) 120000
Total Managerial Remuneration 3132500
Overall Ceiling as per the Act 3000000

C. Remuneration to Key Managerial Personnel other than WTD

Key Managerial Personnel

SI. No. Particulars of Remuneration Company Secretary Charulata Kabra (resigned w.e.f 16.11.2015) CFO Total
1. Gross Salary
(a) Salary as per provisions contained in Section 17(1) of the Income-taxAct 1961 686139 2232969 2919108
(b) Value of perquisites u/s 17(2) of the Income-taxAct 1961 - 639927 639927
(c) Profits in lieu of salary u/s 17(3)of the Income-tax Act 1961 - - -
2. Stock Option - - -
3. Sweat Equity - - -
4. Commission
- as % of profit - - -
- others specify - - -
5. Others please specify - - -
Total 686139 2872896 3559035

VII. Penalties/punishment/compounding of offences:

Type Sections of The Companies Act Brief

Description

Details of Pentalty/ Punishment Compounding Fees imposed Authority

[RD/NCLT/

COURT]

Appeal made if any (give details)
A. COMPANY
Penalty
Punishment Nil
Compounding
B. DIRECTORS
Penalty
Punishment Nil
Compounding
C. OTHER OFFICERS IN DEFAULT
Penalty
Punishment Nil
Compounding

 

For and on behalf of the Board
Kolkata U. KANORIA
May 30 2016 Chairman & Mg. Director

Annexure B

NOMINATION & REMUNERATION POLICY & PERFORMANCE EVALUATION OF DIRECTORS

Introduction

The Board of Directors (herein after referred as ‘Board’) of the Company atits meeting held on May 9 2014 have reconstituted the existing Remuneration Committee bychanging its nomenclature as Nomination & Remuneration Committee (herein afterreferred as ‘Committee’) of the Board of Directors in accordance with theprovision of Section 178 of the Companies Act 2013 and also stipulated additional termsof reference in line with the Companies Act 2013.

The Committee in their meeting held on May 12 2014 has formulated the criteria foridentification and selection of the suitable candidates for various positions in seniormanagement and also candidates who are qualified to be appointed as director on the Boardof the Company. The Committee also recommended a policy relating to the remuneration forthe directors key managerial personnel and other senior management personnel and aprocess by which the performance of the directors could be evaluated.

I. Criteria for selection of members on the Board of Directors and Senior Management

The Committee has adopted the following criteria for selection of members on the Boardof the Company and also candidates eligible to be appointed in the senior management ofthe Company.

A) Criteria for Selection of Directors

Before making any recommendation to the Board for appointment of any director theCommittee shall ensure that the candidate:

a) possess positive attributes/qualities such as leadership accumenship andexperience in running industrial units entrepreneurship or such other attributes which inthe opinion of the Committee the candidate possess and are in the interest of theCompany.

b) is not disqualified under Sections 164 and 167 of the Companies Act 2013

c) complies with the conditions of being independent as stipulated under the CompaniesAct 2013 and Listing Agreement entered into with Stock Exchanges in case of appointmentas an independent director.

d) possesses appropriate skills experience and knowledge in one or more fields offinance law management sales marketing administration corporate governancetechnical operations infrastructure or such other areas or disciplines which are relevantfor the Company’s business.

B) Criteria for selection of Senior Management Personnel

The term Senior Management shall have the same meaning as provided under theexplanation to Section 178 of the Companies Act 2013. The Committee shall before makingany recommendation to the Board for appointment should ensure that the candidate has thefollowing attributes:

a) rich experience in any of the areas viz. banking financial management legalsales marketing administration corporate governance technical operations or suchother areas or disciplines which in the opinion of the management and committee arerelevant for the Company’s business.

b) possesses qualities that demonstrate leadership skills decision making skillseffective communication hard work commitment and such other attributes which in theopinion of the Committee the candidate possess and are in the interest of the Company.

If the Committee after due deliberation finds that the candidate meets the abovecriteria for appointment (as director on the Board or in senior management) hence itshall make its recommendation to the Board.

Any amendment to the above criteria for directors and senior management shall besubject to the prior approval of the Committee and any such amendment shall be informed tothe Board of Directors.

II. Remuneration Policy for Directors Senior Management and Key Managerial Personnel

A) Remuneration of Managing Director Whole Time Director and Manager:

The Committee while considering the remuneration of the Managing Director the WholeTime Director and Manager (wherein there is no Managing Director) may take intoconsideration the performance the experience of the person his/her backgroundjob-profile and suitability his/her past remuneration the comparative remunerationprofile in the industry size of the company responsibilities shouldered by the ManagingDirector / Whole Time Director etc. provided that any remuneration considered by theCommittee shall be in accordance and within the limits stipulated under the Companies Act2013.

B) Remuneration of Non-Executive Director (NED)

a) The remuneration to the NEDs may be restricted to the sitting fees being paid forattendance of the meeting of the Board of the Directors

b) The Independent Directors of the Company shall be entitled to remunerationrestricted to the sitting fees being paid for attendance of the meeting of the Board ofthe Directors provided that any sitting fees paid to the Independent Director shall not beless than the sitting fees paid to non-executive directors.

c) Independent Directors shall not be eligible for stock options of the Company ifany.

C) Remuneration of Senior Management Personnel and KMPs

The Remuneration of the Senior Management Personnel and KMPs shall be in accordancewith the policy of the Company which is applicable to the employees. The Committee mayconsider the remuneration of a Senior Management Personnel keeping in view of theachieving yearly targets Performance of Business/Functions under his controlcontribution for long term & strategic growth of the Company.

III. Evaluation of performance of Directors

A) Evaluation of the performance of Managing Director/ Whole Time Director

The performance of the Managing Director/Whole Time Director of the Company may becarried out taking into consideration the performance of the Company vis-a-vis the budgetsas well as performance of its competitors emphasis on achieving top line and bottom linetargets influencing the executives to achieve specific and predetermined goals during thefinancial year looking after the interest of Shareholders and ensuring sustainedlong-term goals.

B) Evaluation of the performance of Non-Executive Directors and Independent Directors(NEDs and IDs)

The Committee while evaluating the performance of the NEDs and IDs may take intoconsideration various factors as mentioned below:

a) Attendance at Meetings - attendance at Board Meetings AGMs Committee Meetings

b) Other Directorships held by the NED - in listed or unlisted companies

c) Other companies in which NED is a Chairperson

d) Participation at Board/Committee Meetings

e) Input in strategy decisions

f) Review of Financial Statements risks and business performance

g) Time devoted towards discussion with Management

h) Review of Minutes - Board Minutes Committee Meeting Minutes and AGM Minutes

For and on behalf of the Board
Kolkata U. KANORIA
May 30 2016 Chairman & Mg. Director

Annexure C

SECRETARIAL AUDITOR REPORT for the Financial Year/Period Ended 31.03.2016(01.10.2014-31.03.2016)

[Pursuant to Section 204(1) of the Companies Act 2013 and Rule No. 9 of the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014]

To

The Members

Kanco Enterprises Limited Jasmine Tower 3rd Floor 31 Shakespeare SaraniKolkata-700017

We have conducted the secretarial audit of the compliance of applicable statutoryprovisions and the adherence to good corporate practices by Kanco Enterprises Limited havingits Registered Office at Jasmine Tower 3rd Floor 31 Shakespeare Sarani Kolkata -700017 (hereinafter called the Company). Secretarial Audit was conducted in a manner thatprovided us a reasonable basis for evaluating the corporate conducts/statutory compliancesand expressing our opinion thereon.

Based on our verification of the books papers minute books forms and returns filedand other records maintained by the Company and also the information provided by theCompany its officers agents and authorized representatives during the conduct ofsecretarial audit we hereby report that in our opinion the Company has during the auditperiod covering the financial year/period ended 31.03.2016 complied with the statutoryprovisions listed hereunder and also that the Company has proper Board-processes andcompliance-mechanism in place to the extent in the manner and subject to the reportingmade hereinafter.

Auditors’ Responsibility

Maintenance of Secretarial Records is the responsibility of the management of theCompany. Our responsibility is to express an opinion on existence of adequate Boardprocess and compliance management system commensurate to the size of the Company basedon these secretarial records as shown to us during the said audit and also based on theinformation furnished to us by the officers’ and the agents of the Company during thesaid audit.

We have followed the audit practices and processes as were appropriate to the best ofour understanding to obtain reasonable assurance about the correctness of the contents ofthe secretarial records. The verification was done on test basis to ensure that correctfacts are reflected in secretarial records. We believe that the processes and practiceswe followed provide a reasonable basis for our opinion.

We have not verified the correctness appropriateness and bases of financial recordsbooks of accounts and decisions taken by the Board and by various committees of theCompany during the period under scrutiny. We have checked the Board process and compliancemanagement system to understand and to form an opinion as to whether there is an adequatesystem of seeking approval of respective committees of the Board of the Board of themembers of the Company and of other authorities as per the provisions of various statuesas mentioned hereinafter.

Wherever required we have obtained the management representation about the complianceof the laws rules and regulations and happening of events etc.

The Compliance of the provisions of Corporate and other applicable laws rulesregulations and standards is the responsibility of the management. Our examination waslimited to the verification of compliance procedures on test basis.

Our report is neither an assurance as to the future viability of the Company nor of theefficacy or effectiveness or accuracy with which the management has conducted the affairsof the Company.

We report that we have examined the books papers minute books forms and returnsfiled and other records maintained by the Company for the financial year / period ended31.03.2016 according to the provisions of:

(i) The Companies Act 2013 (the Act) and the rules made there under;

(ii) Secretarial Standards (SS - land SS-2) as issued by The Institute of CompanySecretaries of India and which became effective from 01.07.2015.

(iii) Listing Agreement with the Stock Exchanges.

(iv) The Securities Contracts (Regulation) Act 1956 and the rules made there under;

(v) The Depositories Act 1996 and the Regulations and Bye-laws framed there under;

(vi) Foreign Exchange Management Act 1999 and the rules and regulation made thereunder to the extent of Foreign Direct Investment Overseas Direct Investment and ExternalCommercial Borrowings;

(vii) The following Regulations and Guidelines prescribed under the Securities andExchange Board of India Act 1992 :

(a) The Securities and Exchange Board of India (Substantial Acquisition of Shares andTakeovers) Regulations 2011;

(b) The Securities and Exchange Board of India (Prohibition of InsiderTrading)Regulations 2015;

(c) The Securities and Exchange Board of India (Registrars to an Issue and ShareTransfer Agents) Regulations 1993 regarding the Companies Act and dealing with client;

(d) The Securities and Exchange Board of India (Listing Obligations and DisclosureRequirements) Regulations 2015.

We further report that having regard to the compliance system prevailing in theCompany our examination and reporting is based on the documents records and files asproduced and shown to and the information and explanations as provided to us by theCompany and its management and to the best of our judgment and understanding of theapplicability of the different enactments upon the Company. Further to the best of ourknowledge and understanding there are adequate systems and processes in the Companycommensurate with its size and operation to monitor and ensure compliances with applicablelaws including general laws labour laws competition law environments laws etc.

During the period under review the Company has complied with the provisions of the ActRules Regulations Guidelines Standards etc. as mentioned above.

During the period under review provisions of the followingregulations/guidelines/standards were not applicable to the Company:

(i) The Securities and Exchange Board of India (Buyback of Securities) Regulations1998;

(ii) SEBI (Share Based Employee Benefits) Regulations 2014

(iii) The Securities and Exchange Board of India (Issue and Listing of Debt Securities)Regulations 2008;

(iv) The Securities and Exchange Board of India (Issue of Capital and DisclosureRequirements) Regulations 2009;

(v) The Securities and Exchange Board of India (Delisting of Equity Shares)Regulations 2009.

We further report that:

(a) The Board of Directors of the Company is duly constituted with proper balance ofExecutive Director NonExecutive Directors and Independent Directors. The changes in thecomposition of the Board of Directors that took place if any during the period underreview were carried out in compliance with the provisions of the Act.

(b) Adequate notice is given to all directors to schedule the Board Meetings agendaand detailed notes on agenda were sent at least seven days in advance and a system existsfor seeking and obtaining further information and clarifications on the agenda itemsbefore the meeting and for meaningful participation at the meeting.

(c) Majority decision is carried through while the dissenting members’ views ifany are captured and recorded as part of the minutes.

(d) There are adequate systems and processes in the company commensurate with the sizeand operations of the company to monitor and ensure compliance with applicable lawsrules regulations and guidelines.

We further report that:

(i) We have been informed that due to complete erosion of net worth the Company hadapplied to Board for Industrial and Financial Reconstruction (BIFR) under Section 15(1) ofthe Sick Industrial Companies (Special Provisions) Act 1985 (SICA) for the year ended30th September 2012 which is still pending hence no fresh application has been made bythe Company for the financial year ended 31st March 2016. The Company’s appeal underSection 25(1) of the SICA against the order passed by the BIFR for reference no. 3/2012filed under Section 15(1) of the SICA on 13.01.2012 is also pending.

(ii) The Company has not made the requisite compliances pertaining to publication ofunaudited financial results for the quarter ended 30th September 2015 and 31st December2015 in terms of erstwhile Clause 41 of the listing agreement and Regulation 33 of TheSecurities and Exchange Board of India (Listing Obligations and Disclosure Requirements)Regulations 2015 respectively.

(iii) The Company in general is defaulter in repayment of the outstandingloans/borrowings.

For A. K. LABH & Co.
CompanySecretaries
(A. K. LABH)
Place : Kolkata Practicing Company Secretary
Dated : 30.05.2016 FCS - 4848 / CP No.- 3238

Annexure D

A statement pursuant to Section 134(3)(m) of the Companies Act 2013 read with Rule8(3) of the Companies (Accounts) Rules 2014 on Conservation of EnergyTechnologyAbsorption Foreign Exchange Earning & Outgoings

a. Conservation of Energy

(i) the steps taken for conservation of energy : -

The Company is aware of the importance of energy conservation in decreasing theinimical effects of global warming and climate change. The Company has optimized theutilization of machineries and reduced the energy consumption from 3.90 units per kg ofyarn produced to 3.83 units per kg of yarn produced.

(ii) the steps taken by the Company for utilising alternate sources of energy - Nil

(iii) the capital investment on energy conservation equipment - Nil

b. Technology Absorption

(i) the efforts made towards technology absorption - Not Applicable

(ii) the benefits derived like product improvement cost reduction product developmentor import substitution - Not Applicable

(iii) in case of imported technology (imported during the last three years reckonedfrom the beginning of the financial year) - Not Applicable

(iv) the expenditure incurred on Research and Development - Nil

c. Foreign Exchange Earnings and Outgo

The Company has not made any direct export but its product are sold to merchantexporters.

Particulars Rs in Lakhs
1. Foreign Exchange earned in terms of actual Inflows Nil
2. Foreign Exchange Outgo 41.24

 

Kolkata For and on behalf of the Board U. KANORIA
May 30 2016 Chairman & Mg. Director