To the Members
Your Directors are pleased to present the 35th Annual Report of your Company along withAudited Financial Statement for the financial year ended 31st March 2017.
The financial performance of the Company for the year ended 31st March 2017is summarised below:
| || ||(Rs. in Lacs) |
|Particulars ||2016-17 ||2015-16 |
|Sales (Gross) ||36434.54 ||39777.24 |
|Net Sales ||36202.58 ||39404.56 |
|Surplus before interest depreciation exceptional items and Tax ||4148.61 ||4165.11 |
|Less: Financial Cost ||3114.59 ||2966.23 |
|Cash Profit before tax ||1033.68 ||1198.88 |
|Less: Depreciation ||820.27 ||863.61 |
|Exceptional Items ||- ||- |
|Profit /(Loss) before taxation ||213.41 ||335.27 |
|Provision for current tax ||97.66 ||75.94 |
|MAT Credit Entitlement ||(76.36) ||- |
|Income Tax of earlier year ||1.91 ||- |
|Deferred tax ||11.03 ||93.66 |
|Profit /(Loss) after taxation ||179.17 ||165.67 |
|Transfer to General Reserve ||- ||- |
|Earning Per Share (face value of Re. 1/! each) ||0.18 ||0.17 |
REVIEW OF OPERATIONS
FERTILIZERS & CHEMICALS DIVISION
The year 2016-17 continued to be a challenging period with weak economic environmentdue to previous two years of drought and consequently high channel stocks and low incomewith the farmers. Also the country faced a consecutive drought (in some of the regions)for the second year in 2016-17 which is a rare phenomenon. As a result the agriculturerelated businesses; especially fertilizers trade was very poor. On top of that there was amajor shortage of one of the raw materials due to running out of zinc ore deposits withHindustan Zinc ltd. a major supplier of Sulphuric Acid to western India. That too in thepeak Kharif season. The depreciating Indian currency during major part of the yearcompounded the situation since the Company's major raw material is imported.
Further the demonetization had a major impact by way of slowdown in Indian agriculturesector. Keeping in mind the huge dependence of the agriculture sector on cash thefarmers especially small and marginal among them were adversely affected offsetting thebenefits of a good monsoon season after two years of drought. The agricultural sector isstill not fully recovered from the adverse impact of demonetization. We are keeping an eyeon the market and continuing with all our schemes and promotions for rewarding non-cashpayments.
During the year even though the turnover of your Company has decreased from Rs.39404.56 lacs for the year 2015-16 to Rs. 36202.58 lacs for the year 2016-17 by about 8%the operating income has decreased only marginally from Rs 4165.11 lacs in 2015-16 to Rs4148.27 lacs in 2016-17 and the cash profit has decreased from Rs 1198.88 lacs to Rs1033.68 in the respective periods while the net profit after tax has increased from Rs.165.67 lacs to Rs. 179.17 lacs. The increase in net profit after tax is mainly due to theprovision of MAT Credit Entitlement Rs 76.36 lacs in 2016-17 against Rs. NILlacs in2015-16. The Company has produced 415452 MT (previous year 337329 MT) Single SuperPhosphate and sold 385574 MT including export of 500 MT (previous year 404646 MT).
The Company is trying to diversify its portfolio and has initiated import of NPKfertilizers in a small way. The Company has imported 6417 MT NPK fertilizers (previousyear NIL) and sold 2898 MT during the year (previous year NIL).
The Company is continuing its efforts for optimizing its current assets to leveragesales on the one hand and diversifying into new geographical markets on the other. Morefocus is being laid on producing value added fortified fertilizers to improve the productportfolio. Further with the long range forecast of normal monsoons in the current year2017-18 we expect to perform better in this year.
The Government has also removed the statutory requirement of minimum productioneffective from the financial year 2016-17 onwards. This would further benefit the SSPIndustry as an unnecessary burden to produce material compulsorily has been done awaywith. Now the Industry can produce only the desired quantity as per the requirement ofthe markets. The Government has reduced the Nutrient Based Subsidy rates from Rs.2343/-per MT to Rs. 2166/- per MT w.e.f. 01.04.2017 and this revision in subsidy would impactthe realizations in the short term however we expect the impact would be neutralized overa period with gradual increase in prices of the products.
Raw material prices now seem to have stabilized. Further with the expected long termpolicy of the Government of India for direct subsidy to farmers it shall help the growthof SSP Industry in a free but competitive environment.
The Soya Industry is passing through a tough phase with widespread activities ofspeculation by Industry players.
The Company has reduced its activities in this segment to a large extent along withtotal control on fixed expenses.
GOODSAND SERVICE TAX (GST)
The passage of the GST bill in the Parliament is a positive for the economy and willbring in more transparency in the tax administration. GST will create a common Indianmarket improve tax compliance and governance. The transition to GST is complex from anadministrative as well as a technological perspective. What will be critical is theefficiency in relation to its implementation.
The Board of Directors is pleased to recommend final dividend of Re. 0.05 per equityshare (face value of Re. 1/- per share) for the financial year 2016-17 previous yearRe.0.05 per equity share.
The paid up Equity Share Capital as on 31st March 2017 was Rs. 969.89 Lacs dividedinto 96989200 shares of Re. 1/- each. During the year under review the Company has notissued shares with differential voting rights nor granted stock options nor sweat equity.
The Company has not transferred any amount to General Reserves for the financial year2016-17.
INVESTORS EDUCATIONAND PROTECTION FUND
Dividend which was declared by the Company for the year ended March 31 2010 at theAnnual General Meeting held on July 30 2010 and remained unclaimed will be transferred tothe Investor Education and Protection Fund of the Central Government on August 27 2017pursuant to the provisions of Companies Act 2013. Thereafter no claim shall lie ondividend for the year ended March 2010 from the shareholders.
PROJECTS & FINANCE
The Company has availed loans of Rs. 11.85 Crores from State Bank of India and AxisBank for modernization of acid plants and purchase of vehicles.
The Company has not accepted any deposits from the public during the year under reviewpursuant to the provisions of Section 73 of the Companies Act 2013 & the DepositRules made thereunder.
MATERIAL CHANGES EFFECTING FINANCIAL POSITION OF THE COMPANY
No material changes have occurred and commitments made affecting the financialposition of the Company between the end of the financial year of the Company and the dateof this report. There is no order passed by any regulator or court or tribunal against thecompany impacting the going concern concept or future operations of the Company.
CONSERVATION OF ENERGYAND TECHNOLOGYABSORPTION
Information required under section 134(3)(m) of the Companies Act 2013 read with theCompanies (Disclosure of Particulars in the Report of Board of Directors) Rules 1988 isannexed in Form-A of Annexure A' and forms part of the report.
Your Directors are of the opinion that the Company has already opted for latesttechnology for producing Single Super Phosphate Sulphuric Acid and Seed Processing &Oil Refinery. Hence information specified to be given in Form-B of Annexure A' isnot applicable.
MANAGEMENT DISCUSSIONANDANALYSIS REPORT
In accordance with Schedule V (B) of the SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 the Management Discussion and Analysis Report forms partof this Report (Annexure - B)
FOREIGN EXCHANGE EARNINGAND OUTGO
The Company has earned Rs. 55.41 lacs on export of goods (Previous year Rs. NIL) andincurred Rs. 12653.73 lacs (Previous year Rs. 6937.79 lacs) on import of Raw MaterialsNPK Fertilizers Fees & Subscription and Interest on Foreign Currency Loan.
In accordance with the provisions of Section 152 (6) (c) of the Companies Act 2013 andthe Articles of Association of the Company Shri Utsav Khaitan ( DIN : 03021454) WholeTime Director of the Company is due to retire at forthcoming Annual General Meeting andbeing eligible has offered himself for re-appointment. Directors recommend hisreappointment for the consideration of members of the Company at the ensuing AnnualGeneral Meeting.
Particulars of the directors seeking appointment/re-appointment are provided in thenotes forming part of the notice for the ensuing Annual General Meeting as required underRegulation 36(3) of the SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015.
The Company has received disclosures from all the directors and none of the directorshas been disqualified as stipulated under Section 164 of the Companies Act 2013 and rulesmade thereunder.
During the year the Board of Directors met 5 (Five) times. The details of the BoardMeetings and the attendance of the Directors are provided in the Corporate GovernanceReport (Annexure - C).
KEY MANAGERIAL PERSONNEL
The following employees were designated as whole-time Key Managerial Personnel asrequired under section 203 of the Companies Act 2013 by the Board of Directors during theyear under review: (a) Shri Shailesh Khaitan Chairman & Managing Director; (b) ShriHarsh Vardhan Agnihotri President & Chief Financial Officer and (c) Shri KamleshJoshi Company Secretary & General Manager
INDEPENDENT DIRECTORS DECLARATION
The Independent Directors have confirmed and declared that they are not disqualified toact as an Independent Director in compliance with the provisions of Section 149 of theCompanies Act 2013 read with Regulation 16 (B) of the SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 and the Board is also of the opinion that theIndependent Directors fulfill all the conditions specified in the Companies Act 2013making them eligible to act as Independent Directors.
Your Company has always strived to maintain appropriate standards of good corporategovernance. The report on corporate governance as stipulated under Schedule V (C) of theSEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 forms part ofthis Report. The requisite certificate confirming compliance with the conditions ofcorporate governance as stipulated under the said clause is attached to this report.(Annexure C).
DETAILS OF SUBSIDIARY / JOINT VENTURES / ASSOCIATE COMPANIES
The Company has no Subsidiary/Joint Venture/Associate Company.
PARTICULARS OF LOAN GUARANTEES INVESTMENTS
During the year under review the Company has not made any investments or given loan orprovided security or guarantees falling under the provisions of Section 186 of the"the Act".
VIGIL MECHANISM / WHISTLE BLOWER POLICY
As per the requirement of Section 177 (9) of the Companies Act 2013 and Regulation 22of the SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 theCompany has established a Vigil Mechanism called the Whistle Blower Policy' forDirectors and Employees to report concern of unethical behavior actual or suspected fraudor violation of the Company's Code of Conduct or ethics policy and the details of theWhistle Blower Policy has been uploaded on the Company's website Web-link:http://khaitanchemfert.com/wp-content/uploads/2016/04/KCFL-Vigil-Mechanism-PolicyNOMINATIONAND REMUNERATION POLICY
Pursuant to Section 178 of the Companies Act 2013 the rules made there under andRegulation 19 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations2015 the Nomination and Remuneration Committee comprises of Shri Balmukund DakheraChairman Shri Vijay Gupta and Ms. Veena Chadha as its members.
The Nomination and Remuneration Committee framed a policy for selection andappointment re-appointment removal appraisals of Directors and Senior Management andthe same is stated in the Corporate Governance Report (Annexure C).
AUDITORS &AUDIT REPORT
Pursuant to provisions of section 139 of the Companies Act 2013 and rules madethereunder the term of Office of M/s. S. S. Kothari Mehta & Co. CharteredAccountants New Delhi as Statutory Auditors of the Company will conclude from the closeof ensuing Annual General Meeting of the Company.
The Board of Directors places on record its appreciation to the services rendered byM/s. S. S. Kothari Mehta & Co. Chartered Accountants New Delhi as the StatutoryAuditors of the Company.
The Company has received proposal from M/s. NSBP & Co. Chartered Accountants NewDelhi regarding appointment of Statutory Auditors of the Company and they have alsoconsented for carrying out the Statutory Audit of the Company.
The Board has recommended appointment of M/s. NSBP & Co. Chartered AccountantsNew Delhi as Statutory Auditors of the Company for carrying out the Statutory Audit of theCompany for the Term of 5 years commencing from the conclusion of 35th Annual Generalmeeting to the conclusion of 40th Annual General Meeting of the Company (from FinancialYear 2017-2018 to 2021-2022) which will be subject to ratification by shareholders inensuing Annual General Meeting. The Company has received a certificate from them to theeffect that their appointment as Statutory Auditors of the Company if made would bewithin the limit prescribed u/s 139 & 141 of the Companies Act 2013 & alsoreceived a peer review certificate issued by the ICAI Peer Review Board' asrequired under the provisions of the SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015.
There have been no instances of fraud reported by the Statutory Auditors under Section143(12) of the Act and Rules framed thereunder either to the Company or to the CentralGovernment.
The notes on accounts referred to and the Auditors' Report are self-explanatory andtherefore do not call for any explanatory note.
The Board of Directors in pursuance of an order under section 148 of the CompaniesAct 2013 read with Rule 14 of the Companies (Audit & Auditors) Rules 2014 issuedby the Central Government has appointed on the recommendation of Audit Committee M/s.M.P. Turakhia & Associates Cost Accountants Indore as Cost Auditors to conduct auditof the cost accounts maintained by the Company in respect of Fertilizer Sulphuric Acidand Soya products for the financial year 2017-18.
As required under Companies Act 2013 a resolution seeking members approval for theremuneration payable to cost Auditor forms part of the notice conveying the Annual GeneralMeeting for their ratification.
M/s. APAS & Company Chartered Accountants New Delhi is appointed as an InternalAuditor of the Company to conduct the internal audit of the Company for the Financial Year2017-18 as required under Section 138 of the Companies Act 2013 and the Companies(Accounts) Rules 2014. The Company has an Internal Control System commensurate with thesize scale and complexity of its operations. The scope and authority of the InternalAudit function is defined. The Audit Committee of the Board of Directors actively reviewsthe adequacy and effectiveness of the Internal Control System and suggest improvements tostrengthen the same. To maintain its objectivity and independence the Internal Auditorreports to the Chairman of the Audit Committee of the Board. Based on the report ofinternal audit function Company undertakes corrective action in their respective areasand thereby strengthen the controls. Recommendations along with corrective actions thereonare presented to the Audit Committee of the Board and accordingly implementation has beencarried out by the Company.
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 M/s Ritesh Gupta & Co. Company Secretaries Indore to undertake theSecretarial Audit of the Company for the financial year 2017-18.
The Secretarial Audit Report is self-explanatory and therefore do not call for anyexplanatory note and the same is annexed herewith as (Annexure-D).
The Company has complied with the Secretarial Standards issued by The Institute ofCompany Secretaries of India (ICSI).
CORPORATE SOCIAL RESPONSIBILITY (CSR) INITIATIVES
Pursuant to Section 135 of Companies Act 2013 and the relevant rules the CorporateSocial Responsibility Committee comprises of Shri Jagdish Lal Jajoo as the Chairman andShri Utsav Khaitan Shri Balmukund Dakhera Shri Vijay Gupta & Ms. Veena Chadha as itsmembers. The detailed CSR Policy has been uploaded on Company's WebsiteWeb-link:http://khaitanchemfert.com/wp-content/uploads/2016/04/ KCFL-CSR-Policy
The Company is not required to spend any amount towards CSR Expenditure as none of thethresholds as specified in Section 135 (1) of the Companies Act 2013 is crossed.(Annexure - E)
Pursuant to the provisions of section 134 (3) (p) of the Companies Act 2013 andapplicable Regulations of the SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 the Board adopted a formal mechanism for evaluating its performance andas well as that of its Committees and Individual Directors including the Chairman of theBoard. The exercise was carried out through a structured evaluation process coveringvarious aspects of the Boards functioning such as composition of the Board &committees experience & competencies performance of specific duties &obligations governance issues etc. The evaluation of the Independent Directors wascarried out by the entire Board and that of the Chairman and the Non-Independent Directorswere carried out by the Independent Directors.
The Directors were satisfied with the evaluation results which reflected the overallengagement and effectiveness of the Board and its Committees with the Company.
EXTRACT OFANNUAL RETURN
The details forming part of the extract of the Annual Return for the year ended March31 2017 in Form MGT-9 is annexed (Annexure F).
In terms of Section 134(5) of the Companies Act 2013 your Directors confirm that:
1. in the preparation of the annual accounts the applicable accounting standards havebeen followed along with proper explanation relating to material departures;
2. 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 fair viewof the state of affairs of the Company as at 31st March 2017 and of the profit & lossof the Company for that period;
3. they have taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of the Companies Act 1956/2013 forsafeguarding the assets of the Company and for preventing and detecting fraud and otherirregularities;
4. they have prepared the annual accounts on a going concern basis.
5. they have laid down internal financial controls to be followed by the Company andsuch internal financial controls are adequate and were operating effectively.
6. they have devised proper systems to ensure compliance with the provisions of allapplicable laws and such systems were adequate and operating effectively.
PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTY
As per the requirement of Regulation 23 of the SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 the Company has formulated the Policy on Materiality ofRelated Party Transactions. All such transactions that were entered into during thefinancial year were on an arm's length basis and in the ordinary course of business. Thereare no materially significant related party transactions made by the Company withPromoters Directors Key Managerial Personnel or other designated persons which may havea potential conflict with the interest of the Company at large.
All Related Party Transactions are placed before theAudit Committee and the same hasbeen approved by the Board. Prior omnibus approval of the Audit Committee is obtained forthe transactions which are of a foreseen and repetitive nature and the same is beenreviewed by the Audit Committee on quarterly basis. The company has framed Policy onMateriality of Related Party Transactions and on Dealing with Related Party Transactionsand is placed on the Company's website and the web link for the same ishttp://khaitanchemfert.com/wp-content/uploads/2016/04/Policy-on-materiality-of-RPT-KCFL.pdf. The Company has also formed Related PartyTransactions Policy and the weblink for same ishttp://khaitanchemfert.com/wp-content/uploads/2016/04/Related-Party-Transactions-Policy.pdf.
Pursuant to the provisions of Section 134 (3) (h) of the Companies Act 2013 theparticulars of contracts or arrangements with related parties referred to in Section188(1) of the Companies Act 2013 and prescribed in Form AOC-2 of Companies (Accounts)Rules 2014 are appended as Annexure-G to this report. Related Party Transactions duringthe year have been disclosed as a part of Financial Statements as required underAccounting Standard 18 issued by the Institute of Chartered Accountants of India.
LISTING OF SHARES
Shares of the Company are listed on The Bombay Stock Exchange Limited (BSE) Mumbaiwhich provides a wider access to the investors nationwide.
The Company has made all the compliances of the SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 including payment of annual listing fees up to31st March 2018 to the BSE.
DEMATERIALISATION OF SHARES
The shares of your Company are being traded in electronic form and the Company hasestablished connectivity with both the depositories i.e. National Securities DepositoryLimited (NSDL) and Central Depository Services (India) Limited (CDSL). In view of thenumerous advantages offered by the Depository system Members are requested to avail thefacility of dematerialization of shares with either of the Depositories as aforesaid. Ason March 31 2017 97.02% of the share capital stands dematerialized.
The Company has in place Risk Management Policy as per requirement of the SEBI (ListingObligations and Disclosure Requirements) Regulations 2015 and Section 134(3)(n) of theCompanies Act 2013 which requires the Company to lay down procedure for risk assessmentand risk minimization. The Board of Directors Audit committee and the Senior Managementof the Company should periodically review the policy and monitor its implementation toensure the optimization of business performance to promote confidence amongst stakeholders in the business processes plan and meet strategic objectives and evaluate tackleand resolve various risks associated with the Company. The business of the Company isexposed to various risks arising out of internal and external factors i.e. IndustryCompetition Input Geography Financial Regulatory Other Operational InformationTechnology related other risks.
Implementation of the Scheme
The functional managers at all locations will be responsible for identifying andassessing the risks within their areas of responsibilities and actions agreed beforehandto resolve such risks. They will report for any new risk or changes in the existing riskto the President/Managing Director. The Board and the senior executives of the Companywill oversee the implementation of the policy and review the same periodically; the Boardwill be updated on key risks faced by the Company and the mitigating actions taken toresolve them.
DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION PROHIBITIONAND REDRESSAL) ACT 2013
"The Company has in place an Anti Sexual Harassment Policy in line with therequirements of The Sexual Harassment of Women at the Workplace (Prevention Prohibitionand Redressal) Act 2013. Internal Complaints Committee (ICC) has been set up to redresscomplaints received regarding sexual harassment. All employees (permanent contractualtemporary trainees) are covered under this policy. The following is a summary of sexualharassment complaints received and disposed off during the year 2016-17.
No of complaints received: NIL
No of complaints disposed off: Not Applicable"
PARTICULARS OF EMPLOYEES
In terms of provisions of Section 197 (12) of the Companies Act 2013 read with Rule5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014and the rules there under as amended from time to time forms part of this report(Annexure-H).
There are no instances of employees who was in receipt of remuneration in excess of thelimit prescribed in provisions of Section 197 (12) of the Companies Act 2013 read withRule 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel)Rules 2014 and the rules made thereunder.
In accordance with the provisions of Section 136 of the Act the Annual Report andAccounts are being sent to all the Members of the Company excluding the aforesaidinformation and the said particulars will be made available on request and also madeavailable for inspection at the Registered Office of the Company. Any Member interested inobtaining such particulars may write to the Company Secretary of the Company. None of theemployees listed in the said Annexure is a relative of any Director of the Company. Noneof the employees hold (by himself or along with his spouse and dependent children) morethan two percent of the equity shares of the Company.
The Board of Directors wish to place on record its sincere appreciation for thesupport and co-operation received from all its stakeholders including customerspromoters shareholders bankers suppliers auditors various departments/ agencies ofCentral/State Government and other business associates of the Company.
Your Board recognizes and appreciates the contributions made by all employees at alllevel that ensure sustained performance in a challenging environment.
| ||for and on behalf of the Board |
| ||(SHAILESH KHAITAN) |
|Place: Gurugram ||CHAIRMAN & MANAGING DIRECTOR |
|Date: May 29 2017 ||DIN: 00041247 |
Annexure - 'A'
I - Form `A' for disclosure of particulars with respect to conservation of energy andforming part of Directors' Report:
A) Power & Fuel Consumption:
|Item ||Current Year ||Previous Year |
|1. Electricity: || || |
|a) Purchased Units (KWH) ||14195788 ||11278655 |
|Total amount (Rs. in Lacs) ||1124.72 ||922.29 |
|Rate/Unit (Rs.) ||7.92 ||8.18 |
|b) Own generation: || || |
|i. Through diesel generator Units (KWH) ||25793 ||18967 |
|Total amount (Rs. in Lacs) ||7.03 ||4.60 |
|Rate/Unit (Rs.) ||27.25 ||24.24 |
|ii. Through steam turbine Units * (KWH) ||6616619 ||4608791 |
|Total amount ||- ||- |
|(*Net of Self Consumption in TG) || || |
|2. Coal: || || |
|Quantity (In MT) ||4142 ||3183 |
|Total Cost (Rs. in Lacs) ||259.63 ||217.78 |
|Rate/Unit (MT) (Rs.) ||6268.96 ||6842.30 |
|3. Furnace oil: || || |
|Quantity (K. Lts.) ||54 ||152 |
|Total Amount (Rs. in lacs) ||16.31 ||51.61 |
|Average Rate /Lt. ||30.38 ||33.99 |
B. Consumption per Unit of Production:
|Item ||Product ||Current Year ||Previous Year |
|Electricity (KWH/MT) ||S.S.P./G.S.S.P ||32.47 ||29.88 |
| ||S.A./Oleum/Liquid So3 ||66.18 ||64.23 |
| ||Labsa ||N.A. ||N.A. |
| ||Soya Oil/Doc ||N.A. ||N.A. |
|Coal (KG/MT) ||Soya Oil/Doc/Power ||N.A. ||N.A. |
| ||G.S.S.P. ||35.27 ||35.36 |
Annexure - 'G'
Form No. AOC-2
(As per "the Act" and rule made thereunder)
(Pursuant to clause (h) of sub-section (3)of section 134 of the Act and Rule 8(2) ofthe Companies (Accounts) Rules 2014)
Form for disclosure of particulars of contracts/arrangements entered into by thecompany with related parties referred to in sub-section (1) of section 188 of theCompanies Act 2013 "the Act" including certain arms length transactions underthird proviso thereto
1. DETAILS OF CONTRACTS ORARRANGEMENTS OR TRANSACTIONS NOTATARM'S LENGTH BASIS:
(a) Name(s) of the related party and nature of relationship - NA
(b) Nature of contracts/arrangements/transactions - NA
(c) Duration of the contracts / arrangements/transactions- NA
(d) Salient terms of the contracts or arrangements or transactions including the valueif any: - NA
(e) Date(s) of approval by the Board if any: - NA
(f) Amount paid as advances if any: - NA
2. DETAILS OF MATERIAL CONTRACTS ORARRANGEMENT OR TRANSACTIONSATARM'S LENGTH BASIS:
(a) Name(s) of the related party and nature of relationship
(b) Nature of contracts/arrangements/transactions:
|S.No. ||Name of Related Parties ||Nature of Relationship ||Nature of Transaction |
|1 ||Shradha Projects Limited ||A public Company in which Shri Shailesh Khaitan is a Director. ||Immovable property has been taken on rent by the Company 01.04.2015 to 31.03.2020 and Unsecured Loan has been also taken by the Company. |
|2 ||Tri-bhuvan Properties Limited ||A public Company in which Shri Shailesh Khaitan is a Director. ||Immovable property has been taken on rent by the Company 01.04.2015 to 31.03.2020 and Unsecured Loan has been alsotaken by the Company. |
|3 ||B.O. Construction Private Limited ||A Private Company in which Shri Shailesh Khaitan is a Director. ||Immovable property has been taken on rent by the Company 01.04.2015 to 31.03.2018 |
|4. ||Arati Marketing Private Limited ||A Private Company in which Shri Shailesh Khaitan is Shareholder ||Unsecured Loan has been taken by the Company. |
Note: The detailed information forms part of Notes to Financial Statements in Note No.25 (AS-18).
(c) Salient terms of the contracts or arrangements or transactions including the valueif any : Terms of the contract confirm to the prevailing marketratesandallthecarehasbeentakentoensurereasonabilityofpricesascomparedtotheprevailingratesinthemarketbetterqualityproductsandtimelysupplies.
(d) Justification for entering into such contracts or arrangements or transactions : Itis ensured that the contract with the Contracting party is advantageous to the Company andits shareholders. The Company intends to ensure following aspects by dealing withcontracting parties.
(e) date(s) of approval by the Board: all the quarterly meetings held during theFinancial Year 2016-17. (f) Amount paid as advances if any: NIL
(g) Date on which the special resolution was passed in general meeting as requiredunder first proviso to section 188: N.A.
3. THE DETAILS OF ALL RELATED PARTY TRANSACTIONS AS PER ACCOUNTING STANDARD 18 HAVEBEEN DISCLOSED IN NOTES TO ACCOUNTS OF FINANCIALSTATEMENT.
| ||for Khaitan Chemicals and Fertilizers Limited |
| ||Shailesh Khaitan |
|Place: Gurugram ||(Chairman & Managing Director) |
|Date: May 29 2017 ||DIN : 00041247 |
Statement of Disclosure of Remuneration under Section 197 of the Companies Act 2013and Annexure - 'H' Rule 5(1) of Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014.
|Name of Director ||Designation ||Ratio to Median Remuneration of the Employees |
|Shri Shailesh Khaitan ||Chairman & Managing Director ||37.46% |
|Shri Utsav Khaitan ||Whole Time Director ||15.74% |
|Shri Jagdish Lal Jajoo ||Whole Time Director ||7.84% |
|Name of Managerial Personnel ||Designation ||% increase in remuneration |
|Shri Shailesh Khaitan ||Chairman & Managing Director ||0.10% |
|Shri Utsav Khaitan ||Whole Time Director ||47.15% |
|Shri Jagdish Lal Jajoo ||Whole Time Director ||- |
|Shri H.V. Agnihotri ||President & Chief Financial Officer ||43.77% |
|Shri Kamlesh Joshi ||Company Secretary & General Manager ||28.15% |
|iii. The % increase in the median remuneration of employees in the financial year ||13.65 |
|iv. The number of permanent employees on the rolls of the Company ||511 |
v. Average percentile increase already made in the salaries of employees other than themanagerial personnel in the last financial year and its comparison with the percentileincrease in the managerial remuneration and justification thereof and point out if thereare any exceptional circumstances for increase in the managerial remuneration:
|S. No. ||Other Employee ||Managerial Personnel |
|1 ||13.88%* ||(20.15%)** |
* These increases are a function of the Company's market competitiveness within itscomparator group as ascertained through the detailed salary benchmarking survey theCompany undertakes annually. The increase during the year reflects the Company's rewardphilosophy as well as the results of the benchmarking exercise.
** The decrease in the managerial percentile is due to retirement of Shri R.S.Vijayvargiya President & CFO w.e.f. 05.08.2015 which includes all the retirementbenefits due to him.
iv. It is hereby affirmed that the remuneration is as per the Remuneration Policy ofthe Company.