The Members Minaxi Textiles Ltd
Your directors have pleasure in presenting herewith their 22nd Annual Reporttogether with the Audited Statements of Accounts for the period ended on 31stMarch 2017.
FINANCIAL HIGHLIGHTS :
|Particulars ||Current year Ended on 31/03/2017 ||Previous year Ended on 31/03/2016 |
| || || |
|Revenue from Operations ||551687397 ||541655727 |
|Other Income ||3161832 ||1578378 |
|Income related to earlier years ||2545918 ||NIL |
|Total Expenditure ||540888208 ||525574248 |
|Profit Before Tax ||22526592 ||23568823 |
|Less : Provision for Current Tax ||8700000 ||7685000 |
|: Deferred Tax ||(552837) ||278282 |
|: Income Tax pertaining to earlier years ||233425 ||203947 |
|Profit after Tax (Transfer to General Reserve) ||14146004 ||15401595 |
|Add : Balance Brought Forward ||74518861 ||59117267 |
|Balance of Reserves and Surplus ||88664865 ||74518861 |
Your directors do not recommend any dividend for the financial year ended on 31stMarch 2017 and decided to plug in the profit for ongoing projects.
OPERATING AND FINANCIAL PERFORMANCE INTERNAL CONTROL :
In the face of overall subdued market conditions our company has performed well. Thisyear the company's total revenue from operations increased by Rs. 100.32 Lacs. During theyear under report the company has achieved a gross turnover of Rs.5516.87 Lacs as compareto Rs. 5416.55 Lacs during the previous year and the operations for the year under reviewhas resulted in the net profit of Rs. 141.46 Lacs. Your company could achieve stablegrowth in business due to continued pursuit of strategy to work with innovative ideasdeveloping areas of its activities and reducing cost of production through processinnovation. Directors hope even better performance during the current year.
The company has in place an established internal control system designed to ensureproper recording of financial and operational information and compliance of variousinternal controls.
CHANGE IN NATURE OF BUSINESS IF ANY :
There is no change in the nature of the business of the company during the year underreview.
ORDER OF COURTS ETC. IF ANY :
There were no significant and material orders passed by regulators or courts ortribunals impacting the going concern status and company's operations in future.
MATERIAL CHANGES AND COMMITMENTS IF ANY :
There were no material changes and commitments affecting the financial position of thecompany occurring between March 31 2017 and the date of this report of the directors.
INFORMATION ABOUT SUBSIDIARY/JOINT VENTURE/ASSOCIATE COMPANY :
The company has no subsidiaries or associate companies therefore disclosures in thisregards are not provided in this report.
TRANSFER TO RESERVES :
The amount of Rs. 141.46 Lacs proposes to transfer to the reserves.
TRANSFER OF UNCLAIMED DIVIDEND TO INVESTOR EDUCATION AND PROTECTION FUND
Since there was no unclaimed Dividend the provisions of Section 125 of the CompaniesAct 2013 do not apply.
CORPORATE SOCIAL RESPONSIBILITY (CSR) :
(Criteria prescribed under section 135 is not attracted)
Every Company is required to constitute / formulate CSR Committee if it gets attractedin one of the criteria prescribed in Section 135.
According to Section 135 of the Companies Act 2013 Every Company having Net Worth ofRs.500 Crore or More or Turnover of Rs.100 Crore or more or Net Profit of Rs.5 crore ormore during any financial year shall constitute a Corporate Social ResponsibilityCommittee and should undertake Corporate Social Responsibility as prescribed in ScheduleVII.
None of the above criteria was applicable to the company for the financial year2016-2017 and hence the company was not required to constitute CSR Committee.
The Company is at present enjoying secured financial assistance in the form of workingcapital facilities and term loan from Bank of India Main Branch Bhadra Ahmedabad.During the year under review the company regularly paid the principal and interest to theBank.
PUBLIC DEPOSIT :
The Company has neither accepted nor invited any deposit from the public falling withinthe ambit of Section 73 of the Companies Act 2013 and the Companies (Acceptance ofDeposits) Rules 2014 during the year under review.
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION FOREIGN EXCHANGE EARNINGS /OUTGO:
The information relating to conservation of Energy Technology Absorption and ForeignExchange Earning / Outgo as required under section 134(3)(m) of the Companies Act 2013read with the Rule 8 of the Companies (Accounts) Rules 2014 is given by way of annexureattached hereto which forms part of this report. (Annexure - I)
PARTICULARS OF EMPLOYEES :
The prescribed particulars of Employees required under section 197(12) read with Rule5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014is attached hereto which forms part of this report. (Annexure - II)
During the year under review none of the top ten employees of the company was inreceipt of remuneration in excess of Rupees One Crore and Two Lac Rupees if employedthrough out the year or in receipt of remuneration exceeding Rupees Eight Lac FiftyThousand p.m. if employed for part of the financial year and hence the disclosure undersection 197(12) read with Rule 5(2) of the Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014 is not applicable.
BOARD OF DIRECTORS :
In accordance with provisions of Section 152(6)(a) of the Companies Act 2013 ShriBharatbhai P. Patel and Shri Nirmal B. Patel retires by rotation and being eligible offersthemselves for re-appointment. According to Section 149(13) of the Act the independentdirectors are the directors who are not liable to retire by rotation. Shri Jinal A. PatelIndependent Director resign during the year w.e.f. 26.10.2016 due to his personal reasons.Shri Kanubhai S. Patel Non Executive Director cessed to be the director due to his deathon 22.06.2016.
Board Evaluation and Criteria :
Pursuant to the provisions of the Companies Act 2013 and Regulation 17 of the SEBI(Listing Obligations and Disclosure Requirements) Regulations 2015 a structuredquestionnaire was prepared after taking into consideration the various aspects of theBoard's functioning composition of the Board and its committees. The Board has carriedout an annual performance evaluation of its own performance of the directors individuallyas well as the evaluation of the working of its Audit Nomination and Remuneration andStake holder Relationship Committees. The Board of Directors expressed their satisfactionwith the evaluation process.
Remuneration Policy :
The Board has on the recommendation of the Nomination and Remuneration Committeeframed a policy for selection and appointment of Directors Senior Management and theirremuneration. The Remuneration Policy is stated in the Corporate Governance Report.
Regular meetings of the Board are held inter-alia to review the quarterly results ofthe Company. Additional Board meetings are convened to discuss and decide on variousbusiness policies strategies and other businesses.
During the FY 2016-17 the Board met Ten (10) times i.e. on 30th April2016 09th May 2016 27th May 2016 07th July 2016 13thAugust 2016 12th November 2016 02nd January 2017 25thJanuary 2017 11th February 2017 and 06th March 2017. Detailedinformation on the meetings of the Board is included in the report on CorporateGovernance which forms part of this Annual Report.
Independent Director's Meeting
A Separate meeting of Independent Directors held on 11th February 2017without the attendance of Non-Independent Directors and members of the Management. In thesaid meeting Independent Directors reviewed the followings :
Performance evaluation of Non Independent Directors and Board of Directors as awhole;
Performance evaluation of the Chairperson of the Company taking into account theviews of executive directors and nonexecutive directors;
Evaluation of the quality quantity and timelines of flow of information betweenthe Management and Board of Directors for effective and reasonable performance of theirduties.
The Board of Directors expressed their satisfaction with the evaluation process.
Statement On Declaration Given By Independent Directors :
The Independent Directors have submitted the declaration of their Independence asrequired pursuant to Section 149(7) of the Companies Act 2013 stating that they meet thecriteria of independence as provided in sub-section (6) of that section.
Your Company has several Committees which have been established as part of the bestCorporate Governance practices and are in compliance with the requirements of the relevantprovisions of applicable laws and statutes.
The Company has following Committees of the Board :
1. Audit Committee
2. Nomination and Remuneration committee
3. Stakeholders and Relationship Committee and
4. Internal Complaints Committee.
Reconstitution Of Audit Committee :
The Board of directors of the company at its meeting held on 12th August2015 has reconstituted an Audit Committee in line with Section 177 of the Companies Act2013 comprising four Directors viz. Shri. Jashwantkumar K. Patel Chairman (havingfinancial and accounting knowledge) Shri. Vasudevbhai L. Patel Shri. Ghanshyambhai C.Patel and Shri. Bharatbhai P. Patel. The constitution of
Audit Committee meets with the requirements under Regulation 18 of the SEBI (ListingObligations and Disclosure Requirements) Regulations 2015 as well.
The Committee periodically discussed the Financial Reporting process reviewed theFinancial Statements and discussed the quality of the applied accounting principles andsignificant judgment that affected the Company's Financial Statements. Before presentingthe audited accounts to the members of the Board the Audit Committee recommended theappointment of the statutory auditors secretarial auditor and internal auditor subjectto the Board's approval. The audit Committee reviewed with adequacy of internal controlsystems with the management statutory and internal auditors.
Re-Constitution Of Nomination And Remuneration Committee (NRC) :
Pursuant to the provisions of Section 178 of the Companies Act 2013 read withCompanies (Meetings of Board and its Powers) Rules 2014 every listed company andprescribed class of companies shall constitute Nomination and Remuneration Committee(NRC) of the Board consisting of 3 or more nonexecutive directors out of which not lessthan / shall be independent director. The composition of the NRC also meets with thecriteria laid down in the Regulation 19 of the SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015.
In view of the above provision of law the Board of Directors at its meeting held on 30thMay 2014 has constituted NRC committee and Re-constituted the same vide its meeting heldon 12th August 2015 which was further reconstituted on 12thNovember 2016 consisting of Shri Dharmendra N. Patel Chairman of the Committee/Independent Director Shri. Bhavikkumar Patel Shri Jashwantkumar Patel IndependentDirector and Shri Dineshbhai P. Patel Chairperson and Whole Time Director of the companyas member of the committee.
Composition of Stakeholders Relationship Committee i.e. Shareholders And InvestorsGrievance Committee :
The Board has re-constituted the Shareholders and Investors Grievance Committee videresolution passed in its Meeting held on 29/07/2011.
According to Section 177 the company is required to constitute a StakeholdersRelationship Committee consisting of a Chairman who shall be a non executive director andsuch other members as may be decided by the Board.
In view of the above provision the company has altered the nomenclature of theShareholders and Investors Grievance Committee to Stakeholders Relationship Committee.Further the membership of the company has also changed in light of the above provisions.
The Stake holders Relationship committee consists of Shri. Dharmendrabhai N. PatelChairman of the Committee/ Independent Director Shri Bharatbhai P. Patel Shri DineshbhaiP. Patel and Shri Nirmal B. Patel as members of the committee.
Disclosure Under The Sexual Harrassment of Women At Workplace (Prevention ProhibitionAnd Redressal) Act 2013 :
The Company has in place an Anti Sexual Harassment Policy in line with the requirementsof the Sexual Harassment of Women at the Workplace (Prevention Prohibition &Redressal) Act 2013. The company has constituted Internal Complaints Committee (ICC) videits Board Meeting held on 11th February 2015 under the chairmanship of ShriBharatbhai Patel Managing Director to redress complaints
received regarding sexual harassment. Shri Nirmal Patel and Smt. Manjulaben Patel arethe other members of the committee. All employees (permanent contractual temporarytrainees) are covered under this policy.
The following is a summary of sexual harassment complaints received and disposed offduring the year.
> No. of complaints received. - NIL
> No. of complaints disposed off- Not Applicable.
VIGIL MECHANISM / WHISTLE BLOWER POLICY :
The Company has adopted a Whistle Blower Policy pursuant to the requirements of theCompanies Act 2013 and the SEBI (LODR) Regulations 2015 to deal with unethicalbehaviour actual or suspected fraud or violation of the Codes of conduct or policy. Themechanism provides for adequate safeguards against victimization of employees andDirectors to avail of the mechanism and also provide for direct access to the Chairpersonof the Audit Committee in exceptional cases. The details of the Policy is also posted onthe website of the Company.
STATEMENT ON DEVELOPMENT AND IMPLEMENTATION OF RISK MANAGEMENT POLICY
There is a continuous process for identifying evaluating and managing significantrisks as faced through a risk management process designed to identify the key risks facingeach business. The role of insurance and other measures used in managing risks is alsoreviewed. Risks would include significant weakening in demand from core-end markets endmarket cyclicality inflation certainties energy cost and shortage of raw materialsmaintenance and protection of leading technologies and adverse regulatory developments.During the year under review no major risks where noticed.
ACCOUNTING STANDARDS AND FINANCIAL REPORTING :
The Company incorporates the accounting standards as and when issued by the Instituteof Chartered Accountants of India. The Company complied with the Stock Exchange and legalrequirement concerning the Financial Statements at the time of preparing them for theAnnual Report.
MANAGEMENT'S DISCUSSION AND ANALYSIS REPORT :
Management's Discussion and Analysis Report for the year under review as stipulatedunder Regulation 34(2)(e) read with Schedule V(B) of the SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 is presented in a separate section formingpart of the Annual Report. (Annexure - III)
The compliance with the Corporate Governance provisions as specified in the Regulations17 to 27 and clauses (b) to (i) of sub-regulation(2) of Regulation 46 and paras CD and Eof Schedule V of SEBI (Listing Regulations) 2015 are not applicable to the companieshaving Paid up Share Capital not exceeding Rs.10 Crores and Net Worth not exceeding Rs.25Crore as on the last day of previous year. According to these regulations your company isnot mandatorily required to comply with the provisions of these regulations for the timebeing as the Paid up Share Capital of the company is not exceeding Rs. 10 Crores and theNet Worth is not exceeding Rs.25 Crores as on the last day of the previous year howeverthe company has made all possible efforts to comply with the provisions of theseregulations of the SEBI (Listing Obligations and Disclosure Requirements) Regulations2015 and the provisions of the Companies Act 2013 during the year under review.
A separate section on Corporate Governance as specified in Schedule V of Regulation34(3) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 isincluded in the Annual Report (Annexure IV) and Certificate from Company's Auditorsand from Practicing Company Secretary confirming the compliance with the code of CorporateGovernance as enumerated in SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 is annexed hereto. (Annexure -V)
Statutory Auditor :
M/s. R.R.S & Associates Chartered Accountants Ahmedabad retire at the conclusionof this ensuing Annual General Meeting. Pursuant to the provisions of Section 139(2) ofthe Act they cannot be further reappointed as the Statutory Auditor of the company. Thecompany has sent proposal to Ms/. Kewlani & Associates Chartered AccountantAhmedabad for their Appointment as Statutory Auditor from the conclusion of forthcoming 22ndAnnual General Meeting till the conclusion of 27th Annual General meetingsubject to ratification in every annual general meeting till the 27th suchmeeting by way of passing of an ordinary resolution. The company has received the writtenconsent of the auditors for its appointment certificate under Section 139(1) read withSection 141 of the Companies Act 2013 to the effect that their appointment if made willbe in accordance to the specified limit.
Auditors Report :
The comments in the Auditors Report with Notes on Accounts referred to the Auditor'sReport are self explanatory and therefore do not call for any further explanation.
Secretarial Auditor :
The Board has considered the recommendation of Audit Committee regarding appointmentand necessity of Secretarial Audit Report as mandate for every listed company in Section204 of the Act and has appointed M/s. Ashok P. Pathak & Co. Company SecretariesAhmedabad as Secretarial Auditor for the financial year 2017 -2018.
Secretarial Audit Report :
The Secretarial Audit Report for the financial year 2016-2017 is annexed herein andforming part of the Board Report (Annexure VI).
The explanation on comments / observation(s) in the Secretarial Audit Report -
The company had appointed qualified Company Secretary as a part of Key ManagerialPersonnel and Compliance Officer w.e.f. 07.07.2016 who have resigned due to his personalreason w.e.f. 08.04.2017. According to Section 203(4) the vacancy created due to theresignation can be filled within a period of six months from the date of such vacancy. Thecompany had put all efforts to appoint a qualified company secretary and ensure to makethe appointment during the current year in compliance with section 203 of the CompaniesAct 2013 read with Rule 8 of the Companies (Appointment of Managerial Personnel) Rules2014.
Internal Auditor :
The Board has considered the recommendation of Audit Committee regarding appointmentand necessity of Internal Auditor as mandate for every listed company in Section 138 ofthe Act and has appointed M/s. Archit B. Shah & Associates Cost AccountantsAhmedabad as Internal Auditor for the financial year 2017 -2018. The Internal Auditor'sreports and their findings on the internal audit has been reviewed by the Audit Committeeon a quarterly basis. The scope of internal audit is also reviewed and approved by theAudit Committee.
EXTRACT OF ANNUAL RETURN :
The extracts of Annual Return pursuant to the provisions of sub-section 3(a) of Section134 and subsection (3) of Section 92 of the Companies Act 2013 read with Rule 12 of theCompanies (Management and administration) Rules 2014 is annexed herewith as (AnnexureVII) to this Report.
PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS
The company has not made any Loans and investments and have not given any guaranteesor provided any securities covered under section 186 of the Companies Act 2013.
The equity shares of the company are listed in the Bombay Stock Exchange Limited whichhas the connectivity in most of the cities across the country.
DEMATERIALISATION OF EQUITY SHARES :
As per direction of the SEBI and the Bombay Stock Exchange Limited the shares of theCompany are under compulsory demat form. The Company has established connectivity withboth the Depositories i.e. National Securities Depository Limited[NSDL] and Central Depository Services India Limited [CDSL]and the demat activation number allotted to the Company is ISIN : INE52C01010. Consequentto sub-division of equity shares of ' 10 each into the equity shares of ' 1 each the newISIN allotted to the Company is ISIN : INE952C01028. Presently shares are held inelectronic and physical mode (96.77% of shares in demat 3.23% in physical mode.)
The company has made necessary arrangements for adequately insuring its insurableinterests.
INDUSTRIAL RELATIONS :
The directors are happy to note that the industrial relations continued to remaincordial during the year. The directors express their appreciation towards the workersstaffs and executive staffs for their coordination and hope for a continued harmoniousrelations.
DIRECTORS' RESPONSIBILITY STATEMENT :
Pursuant to the requirement under Section 134(3)(C) read with Section 134(5) of theCompanies Act 2013 with respect to Director's Responsibilities Statement it is herebyconfirmed :
(i) that in the preparation of the Annual Financial Statement for the Financial Yearended 31st March 2017 the applicable accounting standards had been followedalong with proper explanation relating to material departures; if any;
(ii) that the Director had selected such accounting policies and applied themconsistently and made judgments and estimates that were reasonable and prudent so as togive a true and fair view of the state of affairs of the Company at the Financial Year andof the Profit or Loss of the Company for the year under review;
(iii) that the Directors had taken proper and sufficient care for the maintenance ofAdequate accounting records in accordance with the provisions of the Companies Act 2013for safeguarding the assets of the Company and for preventing and detecting fraud andother irregularities;
(iv) that the Directors had prepared the accounts for the Financial Year ended 31stMarch 2017 on a going concern basis.
(v) that the internal financial controls laid down by the company are adequate and wereoperating effectively.
(vi) that the directors had devised proper systems to ensure compliances with theprovisions of all applicable laws and that such system were adequate and operatingeffectively.
CODE OF INDEPENDENT DIRECTORS - SCHEDULE IV :
The Board has considered Code of Independent Directors as prescribed in Schedule IV ofthe Companies Act 2013. The code is a guide to professional conduct for independentdirectors adherence to these standards by independent directors and fulfillment of theirresponsibility in a professional and faithful manner will promote confidence of theinvestment community and regulators.
The broad items for code for independent directors are :
(i) Guidelines for Professional conduct.
(ii) Role and Functions.
(iv) Manner and process of appointment.
(v) Re-appointment on the basis of report of performance evaluation.
(vi) Resignation or Removal.
(vii) Atleast one Separate meeting of Independent Directors in a year withoutattendance of non independent directors or members of management.
(viii) Evaluation mechanism of Independent Directors by entire Board of Directors.
RELATED PARTY TRANSACTIONS :
The company has not entered into any contract / agreement with Related Parties and haveno transactions with Related Parties during the year under review.
There are no materially significant related party transactions i.e. transactions ofmaterial nature with promoters the directors or the management their subsidiaries orrelatives etc. that may have potential conflicts with the interests of the company atlarge in the financial year 2016-2017.
However the Board has taken note of the provisions of Section 188 of the CompaniesAct 2013 read with Rule 15 of the Companies (Meetings of Board & its Powers) Rules2014 and Regulation 23 of the SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 relating to the Related Party Transactions. The company has formulatedthe policy on Material Related Party Transaction(s).
i) Issue of Equity Shares with differential rights as to dividend voting or otherwise.
During the year 2016-2017 the Company has not issue any of Equity Shares withdifferential rights as to dividend voting or otherwise.
ii) Issue of shares (including sweat equity shares) to employees of the Company underany scheme save and ESOS.
During the year the Company has not issued any shares under Employee Stock OptionScheme.
iii) No significant or material orders were passed by the Regulators or Courts orTribunals which impact the going concern status and Company's operations in future.
There are no significant and material orders passed by the Regulators or Courts orTribunals which could impact the going concern status and the Company's future operations.
We thanks our customers vendors investors and the bankers for their continued supportduring the year. We place on record our appreciation of the contribution made by ouremployees at all levels. Our consistent growth was made possible by their hard worksolidarity cooperation and support.