TO THE MEMBERS
The Directors present their 44th Report together with Audited FinancialStatements of the Company for the financial year ended 31st March 2017.
1. FINANCIAL RESULTS
| ||(Rs./Lacs) ||(Rs./Lacs) |
| ||2016-17 ||2015-16 |
|Profit/(Loss) after charging all expenses before depreciation and amortisation ||505 ||1079 |
|Deduct: Depreciation and amortisation ||709 ||926 |
|Profit/(Loss) for the year ||(204) ||153 |
|Current Tax ||0 ||30 |
|Deferred Tax ||(390) ||30 |
|Profit/(Loss) after tax before discontinuing operation ||186 ||93 |
|Profit/ (Loss) from discontinuing operation ||- ||- |
|Transferred to General Reserve ||186 ||93 |
During the period under Report the Company's sales and other income are Rs.38932 lacsand cash profit is Rs.505 lacs as compared to last year's figures of Rs.37497 lacs andcash profit of Rs.1079 lacs respectively. After depreciation and amortisation the profitfor the year is Rs.186 lacs as compared to the profit of Rs. 93 lacs in the previous year.
The Board of Directors of your Company proposes to retain the profits for use in thebusiness expansion programs. Accordingly no dividend is recommended by the Directors.
4. FIXED DEPOSITS
The details relating to Deposits covered under Chapter V of the Act: (a) Acceptedduring the year - Nil;
(b) There were 15 unpaid/unclaimed fixed deposits with the Company amounting to Rs.6.03Lacs as at the end of the year; (c) There has not been any default in repayment ofdeposits or payment of interest thereon during the year.
5. SUBSIDIARY COMPANY AND CONSOLIDATED FINANCIAL STATEMENTS
In compliance with provisions of Section 129(3) of the Companies Act 2013 read withCompanies (Accounts) Rules 2014 the Company has prepared consolidated financialstatements as per the Accounting Standards on Consolidated Financial Statements issued bythe Institute of Chartered Accountants of India. The audited consolidated financialstatements along with the Auditors' Report thereon forms part of this Annual Report.
During the year the Board of Directors (the Board) have reviewed the affairs of theSubsidiary. Further a statement containing the salient features of the financialstatements of subsidiary in the prescribed format AOC-1 is appended as "Annexure1" to the Board's Report.
In accordance with Section 136 of the Companies Act 2013 the audited financialstatements including the consolidated financial statements and related information of theCompany and audited financial statements of its subsidiary are available on the Company'swebsite at www.milkfoodltd.com.
The Company has no material subsidiary company but in order to comply with the ListingRegulations the Company has adopted a Policy on Material Subsidiary Companies and hasuploaded on the Company's website at www.milkfoodltd.com.
6. PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS
The Company has not given any loans or made investments covered under the provisions ofSection 186 of the Companies Act 2013.
The details of the guarantee given by the Company are given in the Notes to thefinancial statements.
7. MATERIAL CHANGES AND COMMITMENTS IF ANY AFFECTING THE FINANCIAL POSITION OFTHE COMPANY
No material changes and commitments affecting the financial position of the Companyhave occurred between the end of the financial year to which these financial statementsrelate and the date of this Report.
There is no change in the nature of the Company's business during the year underreview.
Mr. Amarjeet Kapoor Director (DIN: 00122843) retires by rotation and being eligibleoffers himself for re-appointment as the Director of the Company. The Board recommends hisre-appointment.
Brief resume of Mr. Amarjeet Kapoor as stipulated under Regulation 36 of SEBI (ListingObligations and Disclosure Requirement) Regulations 2015 is annexed in the CorporateGovernance Report.
Mrs. Gita Bawa was appointed as the Additional Director of the Company in the Boardmeeting held on 30th May 2016 in the category of Independent Director. Herappointment was regularised by the members in the AGM held on 29th September2016.
Mrs. Sushma Sagar was appointed as the Additional Director of the Company in the Boardmeeting held on 30th May 2016 in the category of Non Executive Non IndependentDirector. Her appointment was regularised by the members in the AGM held on 29thSeptember 2016. However She has resigned from the Board of Directors w.e.f. 15thMay 2017.
Further Mr. Anil Girotra and Mr. K.K. Kohli have resigned from the directorship of theCompany w.e.f. 12th August 2016. The Board places on record its sincereappreciation for the useful services rendered by Mr. Anil Girotra Mr. K.K. Kohli and Mrs.Sushma Sagar during their tenure of services with the Company.
Mrs. Asha Gadi and Mrs. Gita Bawa continue to hold the office as the Independent Directorsof the Company.
9. DECLARATION OF INDEPENDENCE
All the Independent Directors have given declarations that they meet the criteria ofindependence as laid down under Section 149(6) of the Companies Act 2013 and Regulation16(b) of the Securities and Exchange Board of India (Listing Obligations and DisclosureRequirements) Regulations 2015.
10. FORMAL LETTER OF APPOINTMENT TO INDEPENDENT DIRECTORS
The Company has issued the formal letter of appointment to all the independentdirectors in the manner as provided under the Companies Act 2013 and the terms andconditions of their appointment have been disclosed on the website of the Company at www.milkfoodltd.com.
11. MEETINGS OF THE BOARD OF DIRECTORS
During the year under review eight Board meetings and one separate meeting of theIndependent Directors were convened and held. The details of which are given in theCorporate Governance Report. The intervening gap between the meetings was within theperiod prescribed under the Companies Act 2013.
12. FAMILIARIZATION PROGRAMMES FOR INDEPENDENT DIRECTORS
The Company has a policy of conducting familiarization programmes for IndependentDirectors in order to familiarize them with the Company their roles rightsresponsibilities in the Company and nature of the industry in which the Company operatesetc. The details of such Policy has been given on the website of the Company at www.milkfoodltd.com.
As per the provisions of Section 177 and 178 of the Companies Act 2013 and the SEBI(Listing Obligations and Disclosure Requirements) Regulations 2015 the Company hasconstituted an Audit Committee Nomination & Remuneration Committee and StakeholdersRelationship Committee. The Composition of these Committees and details of their meetingsare given in the Corporate Governance Report.
14. KEY MANAGERIAL PERSONNEL
Pursuant to the provisions of Section 203 of the Companies Act 2013 Mr. SudhirAvasthi Chief Executive Officer Mr. Sanjeev Kothiala Chief Financial Officer and Mr.Rakesh Kumar Thakur Company Secretary are the Key Managerial Personnel of the Company.
15. DIRECTORS' RESPONSIBILITY STATEMENT
As stipulated in Section 134(3)(c) of the Companies Act 2013 your Directors confirm:
a) that in the preparation of the annual financial statements for the year ended March31 2017 the applicable Accounting Standards have been followed along with properexplanation relating to material departures if any;
b) that such accounting policies as mentioned in Notes to the financial statements havebeen selected and applied consistently and judgments and estimates have been made that arereasonable and prudent so as to give a true and fair view of the state of affairs of theCompany as at March 31 2017 and of the profit of the Company for the year ended on thatdate;
c) that proper and sufficient care has been taken for the maintenance of adequateaccounting records in accordance with the provisions of the Companies Act 2013 forsafeguarding the assets of the Company and for preventing and detecting fraud and otherirregularities;
d) that the annual financial statements have been prepared on a going concern basis;
e) that proper internal financial controls were in place and that the financialcontrols were adequate and were operating effectively.
f) that the systems to ensure compliance with the provisions of all applicable lawswere in place and were adequate and operating effectively.
16.1 STATUTORY AUDITORS
Pursuant to the provisions of Section 139 of the Companies Act 2013 and Rules madethereunder the term of office of M/s Madan & Associates Chartered Accountants as theStatutory Auditors of the Company will conclude from the close of ensuing Annual GeneralMeeting of the Company (AGM).
The Board of Directors places on record its appreciation to the services rendered byM/s Madan & Associates Chartered Accountants as the Statutory Auditors of theCompany.
Subject to the approval of the Members the Board of Directors of the Company hasrecommended the appointment of M/s V. P. Jain & Associates Chartered Accountants(ICAI Firm Registration Number 015260N) as the Statutory Auditors of the Company pursuantto Section 139 of the Companies Act 2013.
Accordingly the Board recommends the resolution in relation to appointment ofStatutory Auditors for the approval by the shareholders at the ensuing AGM. They havegiven their eligibility certificate & consent for the proposed appointment.
16.2 AUDITORS' REPORT
The Auditors' Report does not contain any qualifications/reservation or adverseremarks. Notes to accounts are self explanatory and form an integral part of FinancialStatements.
16.3 SECRETARIAL AUDITORS
Pursuant to the provisions of Section 204 of the Companies Act 2013 and the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 the Secretarial AuditReport submitted by the Company Secretary in Practice is annexed herewith as "Annexure2".
16.4 INTERNAL AUDITORS
M/s Lalit Kumar & Co. Chartered Accountants continues to be the Internal Auditorsof the Company to perform the functions of internal audit.
16.5 COST AUDITORS
On the recommendations of Audit Committee M/s R. J. Goel & Co. Cost Accountants(Firm Registration No.000026) have been appointed as the Cost Auditors to audit the costaccounts of the Company relating to Milk Powder for the financial years 2016-17 and2017-18.
As required under the Companies Act 2013 resolutions seeking members' approval forthe ratification of remuneration payable to the Cost Auditors forms part of the Noticeconvening the ensuing Annual General Meeting.
17. REMUNERATION POLICY
The Board on the recommendations of the Nomination & Remuneration Committee hasframed a Policy for the selection and appointment of directors key managerial personneland also for determining the criteria of their remuneration. The Remuneration Policy hasbeen stated in the Corporate Governance Report and is uploaded on the Company's website atwww.milkfoodltd.com.
18. RISK MANAGEMENT POLICY
Pursuant to Section 134(3)(n) of the Companies Act 2013 the Company has formulated aRisk Management Policy. The Company is aware of the risks associated with the business ofthe Company. It regularly analyses and takes corrective actions for managing / mitigatingthe risks.
At present the Company has not identified any element of risks which may threaten theexistence of the Company.
19. PERFORMANCE EVALUATION
In terms of the requirements of the Act and Listing Regulations a separate exercisewas carried out to evaluate the performance of all the individual Directors on the Boardwho were evaluated on parameters such as level of engagement contribution andindependence of judgment thereby safeguarding the interest of the Company. The performanceevaluation of the Independent Directors was carried out by the entire Board (excluding theDirectors being evaluated). The performance evaluation of the Non Independent Directorswas carried out by the Independent Directors. The Board also carried out annualperformance evaluation of the working of its Audit Committee Nomination and RemunerationCommittee as well as the Stakeholders Relationship Committee. The Directors expressedtheir satisfaction with the evaluation process.
Some of the key criteria for the performance evaluation are as follows
Performance evaluation of Directors:
1. Attendance at the Board/Committee meetings.
2. Contribution at the Board/Committee meetings.
3. Guidance/support to management outside Board/Committee meetings.
Performance evaluation of Board and Committees:
1. Degree of fulfillment of key responsibilities.
2. Board Structure and Composition.
3. Quality of relationship between Board and Management.
4. Efficacy of communication with external shareholders.
5. Effectiveness of Board process information and functioning.
20. DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTIONPROHIBITION
AND REDRESSAL) ACT 2013
The Company has in place an Anti Sexual Harassment Policy in line in accordance withthe requirements of the Sexual Harassment of Women at Workplace (Prevention Prohibition& 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. No complaint has been received duringthe year under review.
21. CORPORATE SOCIAL RESPONSIBILITY
The provisions of the Companies Act 2013 relating to the Corporate SocialResponsibility are not applicable to the Company.
22. CORPORATE GOVERNANCE REPORT
A detailed Report on Corporate Governance forms an integral part of Annual Report andis set out as a separate section therein. A certificate from the Practicing CompanySecretary regarding the compliance with the conditions of corporate governance asstipulated in the Securities and Exchange Board of India (Listing Obligations andDisclosure Requirements) Regulations 2015 is annexed to the Directors' Report.
23. MANAGEMENT DISCUSSION AND ANALYSIS REPORT
In terms of provisions of Regulation 34 of Securities and Exchange Board of India(Listing Obligations and Disclosure Requirements) Regulations 2015 Management Discussionand Analysis Report has been given separately and forms part of this Report.
24. INFORMATION UNDER THE SECURITIES AND EXCHANGE BOARD OF INDIA (LISTING OBLIGATIONSAND
DISCLOSURE REQUIREMENTS) REGULATIONS 2015
The shares of your Company are listed at the BSE Ltd. vide Stock Code: 507621.Thelisting fee for the financial year 2017-18 has been paid.
25. ENERGY CONSERVATION TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO
The information on conservation of energy technology absorption and foreign exchangeearnings and outgo as stipulated under Section 134(3)(m) of the Companies Act 2013read with Rule 8 of the Companies (Accounts) Rules 2014 are annexed herewith as "Annexure3".
26. EXTRACT OF ANNUAL RETURN
In accordance with Section 134(3)(a) of the Companies Act 2013 the details formingpart of the extract of the Annual Return in form MGT-9 is annexed herewith as "Annexure4".
27. PARTICULARS OF EMPLOYEES
The information required pursuant to Section 197(12) read with Rule 5(2) of theCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014 in respect ofemployees of the Company will be provided upon request. In terms of Section 136 of theAct the Report is being sent to all members and others entitled thereto excluding theaforesaid information and the said particulars are available for inspection by the membersat the Registered Office of the Company during the business hours on all the working daysof the Company. The members interested in obtaining such particulars may write to theCompany Secretary.
Disclosures pertaining to remuneration and other details as required u/s 197(12) of theAct read with Rule 5(1) of the Companies (Appointment and Remuneration of the ManagerialPersonnel) Rules 2014 are provided as per "Annexure 5".
28. RELATED PARTY TRANSACTIONS
All related party transactions which were entered into during the financial year wereon arm's length basis and were in the ordinary course of the business. There are nomaterially significant related party transactions made by the Company with Promoters KeyManagerial Personnel or other designated persons which may have potential conflict withthe interest of the Company at large. A disclosure in form AOC-2 is annexed with thisReport as Annexure-6.
None of the Directors have any pecuniary relationships or transactions vis--vis theCompany. All related party transactions have been disclosed in Note 1B (vii) to theAccounts.
All Related Party Transactions are placed before the Audit Committee and also the Boardfor approval.
The policy on Related Party Transactions as approved by the Board is uploaded on theCompany's website at www.milkfoodltd.com.
29. GREEN INITIATIVES
Electronic copies of the Annual Report 2017 and Notice of the 44th AGM arebeing sent to all members whose email addresses are registered with the Company /RTA/Depository Participant(s). For members who have not registered their email addressesphysical copies of the Annual Report 2017 and the Notice of the AGM are being sent by thepermitted mode. Members requiring physical copies can send a request to the CompanySecretary.
The Annual Report 2017 is also available on our website www.milkfoodltd.com.
30. PREVENTION OF INSIDER TRADING
Pursuant to SEBI (Prohibition of Insider Trading) Regulations 2015 the Company hasadopted a Code of Conduct for the prevention of insider trading with a view to regulatethe trading in the securities of Company by the Directors and Designated Employees of theCompany on the basis of unpublished price sensitive information available to them byvirtue of their position in the Company.
The Code under SEBI (Prohibition of Insider Trading) Regulations 2015 is available onthe website of the Company at www.milkfoodltd.com.
31. VIGIL MECHANISM
In pursuant to the provisions of Section 177(9) & (10) of the Companies Act 2013Vigil Mechanism for directors and employees to report their genuine concerns such asunethical behavior actual or suspected fraud violation of the Company's Code of Conducthas been adopted. The Vigil Mechanism Policy has been uploaded on the website of theCompany at www.milkfoodltd.com.
32. INTERNAL CONTROL SYSTEM AND ITS ADEQUACY
The Company has an adequate system of internal control to safeguard and protect fromlosses unauthorized use or disposition of its assets. All the transactions are properlyauthorized recorded and reported to the Management. The Company is following all theapplicable Accounting Standards for properly maintaining the books of accounts andreporting the financial statements. The Internal Auditor of the Company checks andverifies the internal control and monitors them in accordance with the policy adopted bythe Company.
33. COMPLIANCE WITH SECURITIES AND EXCHANGE BOARD OF INDIA (LISTING OBLIGATIONS ANDDISCLOSURE
REQUIREMENTS) REGULATIONS 2015
The Company is fully compliant with the applicable mandatory requirements under theSecurities and Exchange Board of India (Listing Obligations and Disclosure Requirements)Regulations 2015.
We thank our customers vendors investors and bankers for their continued supportduring the year. We place on record our appreciation for the contribution made by ouremployees at all levels. Our consistent growth was made possible by their hard worksolidarity cooperation and support.
| ||For and on behalf of the Board || |
| ||Sd/- ||Sd/- |
|Place : New Delhi ||Amarjeet Kapoor ||Asha Gadi |
|Date : 30th May 2017 ||Director ||Director |
| ||DIN:00122843 ||DIN:00110734 |