Monnet Industries Ltd.
|BSE: 532078||Sector: Metals & Mining|
|NSE: N.A.||ISIN Code: INE407E01029|
|BSE 15:15 | 16 Mar||10.70||
|NSE 05:30 | 01 Jan||Monnet Industries Ltd|
Monnet Industries Ltd. (MONNETINDS) - Director Report
Company director report
TO THE MEMBERS
Your Directors have pleasure in presenting the 34th (Thirty Fourth ) AnnualReport together with the Audited Statement of Accounts of Monnet Industries Limited("the Company") for the year ended 31st March 2017.
1. FINANCIAL SUMMARY
2. FINANCIAL AND OPERATIONAL PERFORMANCE
During the year under review your Company's plant was closed. Therefore operatingincome was Nil as compared to Rs. 1257.52 Lacs during the previous year. The Company hasincurred a loss of Rs. 2190.25/- Lacs as compared to Rs. 3932.41 Lacs during the previousyear.
Further there has been no change in the nature of the business during the period underreview.
In view of loss during the year under review your directors do not recommend anydividend to the shareholders.
In view of loss during the year under review Company has not transferred any amount tothe reserve during the year under review.
5. MATERIAL CHANGES AND COMMITMENTS
No material changes and commitments have taken place between the end of financial yearof the Company to which balance sheet relates and date of
report which affects the financial position of the Company.
6. PUBLIC DEPOSITS
Your Company has not accepted any deposits within the meaning of Chapter V of theCompanies Act 2013 and Companies (Acceptance of Deposits) Rules 2014.
7. SHARE CAPITAL
There was no change in the Company's share capital during the year under review.
The Company's paid up share capital is Rs. 186812620/- (Rupees Eighteen Crore SixtyEight Lac Twelve Thousand Six Hundred Twenty Only) comprising of 3681262 (Thirty SixLacs Eighty One Thousand Two Hundred Sixty) equity shares of Rs. 10/- (Rupees Ten Only)each and 1500000 (Fifteen Lac) 10% Non-Cumulative Non-Convertible Redeemable Preferenceshares of par value of Rs. 100 /- (Rupees Hundred Only) each.
In terms of Section 47(2) of the Companies Act 2013 the shareholders holding abovereferred 10% NonCumulative Non- Convertible Redeemable Preference shares shall have aright to vote on all the resolutions placed before the general meeting.
8. SUBSIDIARIES JOINT VENTURES OR ASSOCIATE COMPANIES
Your Company has no Subsidiary Joint venture or Associate Company and disclosurerequirements in relation to Subsidiaries Joint Ventures or Associate Companies is notapplicable on the Company. Hence it is not required to attach Form AOC-1 pursuant toSection 129(3) of the Companies Act 2013.
9. DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS ORTRIBUNALS IMPACTING THE GOING CONCERN STATUS AND COMPANY'S OPERATIONS IN FUTURE
The Board of Directors of the Company in their meeting held on 07th May2016 formed an opinion that the Company has become a Sick Industrial Company as per SickIndustrial Companies Act 1985 (SICA 1985) and made an Application to Board forIndustrial & Financial Reconstruction (BIFR) for revival and rehabilitation under SICA1985 as company falls under scheduled industry category.
The same was admitted and BIFR asked for further information from the Company. But upondissolution of BIFR vide notification dated 25th November 2016 issued byMinistry of Finance with effect from 01st December 2016 the Company decidednot to transfer such proceeding to National Company Law Tribunal.
Further there are no significant material orders passed by the Regulators / Courtswhich would impact the going concern status of the Company and its future operations.
10. BOARD OF DIRECTORS AND KEY MANAGERIAL PERSONNEL
As per requirements of provisions of Companies Act 2013 and SEBI (Listing Obligationand Disclosure Requirement) Regulations 2015 during the Financial Year under reviewCompany has a proper board composition including Independent Directors Women Directorand other Key Managerial Personnel in terms of Section 203 of Companies Act 2013.
During the period under review Mr. Sourabh Khandelwal resigned as Whole-time Directorof the Company w.e.f. 07th May 2016
Mr. Mahesh Kumar Sharma was appointed as Additional Director of the Company anddesignated as Whole-time Director in the Board Meeting held on 07th
May 2016 for a period of five years w.e.f 07th May 2016. The appointmentof Mr. Mahesh Kumar Sharma was also regularized and approved as Whole-time Director andKMP by the shareholders in the Annual General Meeting held on 30th September2016.
Mr. Rajiv Poddar Independent Director of the company resigned w.e.f. 30thMay 2017.
Further Mr. Sourav Kumar Pradhan resigned as CFO of the Company w.e.f 27thMay 2016 and Mr. Mahesh Kumar Sharma appointed as CFO of the company w.e.f. 25thNovember 2016.
Ms. Khushboo Sharma is the Compliance Officer and Company Secretary of the Company.
In accordance with the provisions of the Section 152 of the Companies Act 2013 and thecompany's articles of association Mr.J. P. Lath Director retires by rotation at theforthcoming Annual General Meeting and being eligible offer himself for reappointment. Thedetails of the directors seeking appointment/ reappointment are given in the Notice of theaforesaid AGM of the Company.
11. STATEMENT ON INDEPENDENCE OF DIRECTORS
All independent directors have given declarations that they meet the eligible criteriaof independence as provided in sub-section (6) of section 149 of the Companies Act 2013and Regulation 16(b) of the SEBI (Listing Obligations and Disclosures Requirements)Regulations 2015. There are two Independent Directors on the Board of the Company namelyMr. R.K. Sachdev and Ms. Babika Goel.
Further Mr. Rajiv Poddar Independent Director of the company resigned w.e.f. 30thMay 2017.
Directors of the Company are not related to each other in accordance with section 2(77)of the Companies Act 2013 and Rule 4 of the Companies (Specification of DefinitionsDetails) Rules 2014
As required under Regulation 26 of SEBI (Listing Obligations and DisclosuresRequirements) Regulations 2015 the required details of directors appointed/reappointed inthe 34th Annual General Meeting (AGM) of the Company is annexed with the Notice of saidAGM.
12. DIRECTOR'S RESPONSIBILITY STATEMENT
The Company has taken utmost care in its operations compliance transparencyfinancial disclosures and financial statements have been made to give a true and fair viewof Company. As required under Section 134(5) and Section 134 (3) and based upon thedetailed representation due diligence and inquiry thereof and your Board of Directorsassures and confirm as under:
a) In preparation of Annual Accounts for the financial year ended 31stMarch 2017 the applicable Accounting Standards and schedule III of Companies Act 2013had been followed and there are no material departures from the same;
b) The directors had selected such accounting policies and applied consistently andmade judgments and estimates that are reasonable and prudent so as to give a true and fairview of the state of affairs of the Company at 31st March 2017 and of theprofit and loss of the Company for the Financial Year ended 31st March 2017;
c) The directors had taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of this Act for safeguarding theassets of the Company and for preventing and detecting fraud and other irregularities;
d) The annual accounts have been prepared on going concern basis;
e) The directors had laid down internal financial controls and same were followed bythe Company and that such financial controls were adequate and were operating effectively;and
f) The directors had devised proper systems to ensure compliance with the provisions ofthe all applicable laws and that such systems were adequate and operating effectively.
13. INTERNAL CONTROLS & INTERNAL FINANCIAL CONTROLS
Your Company has an effective internal control and risk-mitigation system which areconstantly assessed and strengthened with new/revised standard operating procedures. TheCompany's internal control system is commensurate with its size scale and complexities ofits operations. The internal and operational audit is entrusted to M/s Krishan Rakesh& Co. Chartered Accountants. The main thrust of internal audit is to test and reviewcontrols appraisal of risks and business processes besides bench marking controls withbest practices in the industry.
The Audit Committee of the Board of Directors actively reviews the adequacy andeffectiveness of the internal Control systems and suggests improvements to strengthen thesame. The Company has a robust Management information System which is an integral part ofthe control mechanism.
The Audit Committee of the Board of Directors and the Statutory Auditors areperiodically apprised of the internal audit findings and corrective actions taken.Significant audit observations and corrective actions taken by the management arepresented to the Audit Committee of the Board. To maintain its objectivity andindependence the Internal Audit function reports to the Chairman of the Audit Committee.
14. LISTING OF SHARES
The Company's Equity Shares are presently listed at BSE Limited (Phiroze JeejeebhoyTowers Mumbai-400 001). The Listing Fees for the financial year 2017-18 has been paid toBSE Limited.
The Company has made application to The Calcutta Stock Exchange Ltd.(7 Lyons RangeKolkata-700001) for delisting of its equity shares. Pending this application the StockExchange suspended listing of securities of the Company and asked the Company to updatethe compliance status before acceptance of delisting application.
Further as per letter no ASEL/376 dated 19/01/2017 received by the Company fromAhmedabad Stock Exchange (ASE) it is undergoing exit under SEBI Circular No.CIR/MRD/DSA/14/2012 dated May 30 2012 and accordingly no further compliance with respectto ASE is required
The Further details in relation to listing of shares are given the Corporate GovernanceReport attached with the Board Report.
15. BOARD EVALUATION
The board of directors has carried out an annual evaluation of its own performanceboard committees and individual directors pursuant to the provisions of the Act and thecorporate governance requirements as prescribed by Securities and Exchange Board of India(Listing Obligations and Disclosure Requirements)Regulations 2015 ("SEBI ListingRegulations").
The performance of the board was evaluated by the board after seeking inputs from allthe directors on the basis of the criteria such as the board composition and structureeffectiveness of board processes information and functioning etc. The performanceevaluation of the Executive Directors and NonExecutive Directors was carried out by theIndependent Directors. The Board of Directors expressed their satisfaction with theevaluation process.
16. NUMBER OF MEETING OF THE BOARD
During the year Six (6) Board Meetings were convened and held the details of whichare given in the Corporate Governance Report. The intervening gap between the Meetings waswithin the period prescribed under the Companies Act 2013.
17. COMMITTEES OF THE BOARD
The Board of Directors has the following Committees:
1. Audit Committee
2. Nomination and Remuneration Committee
3. Stakeholders' Relationship Committee
4. Executive Committee
5. Delisting Committee
The details of the Committees along with their composition number of meetings termsof reference and attendance of members at the meetings are provided in the CorporateGovernance Report which forms part of this Annual Report. Further during the year underreview the board has accepted all the recommendations of the Audit Committee.
18. CORPORATE SOCIAL RESPONSIBILITY
The Company at present does not fall in any of the criteria(s) as provided undersection 135 of the Companies Act 2013 and Rules made there under. Hence the provisions ofCorporate Social Responsibility are not applicable on the Company.
19. RELATED PARTY TRANSACTIONS
All related party transactions that were entered into during the financial year were onan arm's length basis. Further there have been no materially significant related partytransactions between the Company and the Directors the management the subsidiaries orthe relatives.
In this regard disclosure in Form AOC-2 in terms of Section 134 of the Companies Act2013 form part of the report as Annexure-1.
As required under Regulation 23(1) of the Listing Regulation the Company hasformulated a policy on dealing with Related Party Transactions. The Policy is available onthe website of the Company viz. http://www.monnetgroup.comand at the Weblink:http://www.monnetgroup.com/pdfs/mil/policy/Policy_on_Related_Party_Transactions.pdf.
i) Statutory Auditor
The Auditors report is without any qualifications and notes to the accounts as referredin the Auditors Report are self-explanatory and therefore do not call for any furthercomments or explanations.
At the Annual General Meeting held on September 27 2014 M/s. O.P. Bagla & Co.Chartered Accountants (Firm Registration No. 000018N) were appointed as the StatutoryAuditors of the Company to hold the office till the conclusion of Annual General Meetingto be held in the calendar year 2017 subject to the ratification of shareholders at everyAnnual General Meeting.
Further pursuant to the provisions of section 139 and other applicable provisions ifany of the Companies Act 2013 and rules thereunder as amended time to time the term ofM/s O.P. Bagla & Co. expires at the ensuing AGM. Pursuant to recommendation of AuditCommittee of the Board of Directors M/s APAS & Co. Chartered Accountants(Registration No.000340C) be and hereby proposed to be appointed as Auditors of theCompany to hold such office from conclusion of ensuing Annual General Meeting untilconclusion of 39th Annual General Meeting (subject to ratification of theappointment by the members at every AGM held after this AGM) to conduct audit.
Comments/Qualificationsof the Statutory Auditors in their report and the notes formingpart of the Accounts are self-explanatory and needs no further explanation/ comments.
ii) Secretarial Auditor
Pursuant to Section 204 of the Companies Act 2013 the Company had appointed M/sSanjay Grover& Associates Practicing Company Secretaries New Delhi as theSecretarial Auditor of the Company to conduct the Secretarial Audit of the Company for FY2016-2017. The Report of Secretarial Auditor (Form MR-3) for the FY 2016-2017 is annexedto the report as Annexure -2.
The Secretarial Audit Report for the financial year ended March 31 2017 does notcontain any adverse remark and it is self-explanatory
iii) Internal Auditor
Pursuant to Section 138 of the Companies Act 2013 the Company has appointed M/s.Krishan Rakesh & Co. (Firm Registration No. 009088N) as internal auditor of theCompany in its Board Meeting held on 08th August 2016 for the financial year2016-17
21. MANAGEMENT DISCUSSION & ANALYSIS REPORT
A detailed analysis of your Company's performance is discussed in the ManagementDiscussion and Analysis Report which forms part of this Annual Report and annexed to thereport as Annexure-3.
22. RISK MANAGEMENT
Your Company's Risk Management Policy is backed by strong internal control systems. Therisk management framework consists of policies and procedures framed at management leveland strictly adhered to and monitored at all levels. The framework also defines the riskmanagement approach across the enterprise at various levels. Risk management is embeddedin our critical business activities functions and processes. The risks are reviewed forchange in the nature and extent of the major risks identified since the last assessment.It also provides control measures for risk and future action plans.
The internal audit team periodically visits the divisions and carries out audit. Thefindings are periodically reviewed by the Board and Audit Committee with emphasis onmaintaining its effectiveness in dynamic business environment.
23. DISCLOSURES-EXTRACT OF ANNUAL RETURN
In accordance with the provisions of Section 134(3)(a) of the Companies Act 2013 theextract of the annual return in Form No. MGT - 9 is annexed as Annexure-4 hereto and forms a part of this report.
PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS
In accordance with the provisions of Section 186 of the Companies Act 2013 details ofLoans Guarantees and Investments covered under the provisions of Section 186 of theCompanies Act 2013 for the year are given in the notes to the financial statements.
NOMINATION AND REMUNERATION POLICY
The Board has on the recommendation of the Nomination and Remuneration Committeeframed a policy for selection and appointment of Directors Key Managerial Personnel andtheir remuneration as well as policy on other employees remuneration. The Brief terms ofpolicy is stated on the website http://www.monnetgroup.com/pdfs/others/mil/Policy_Nomination_Remuneration_and_Board_Diversity.pdf.
The details pertaining to composition of audit committee are included in the CorporateGovernance Report which forms part of this report.
VIGIL MECHANISM / WHISTLE BLOWER POLICY
The Company has a vigil mechanism named Vigil Mechanism / Whistle Blower Policy to dealwith instances of fraud and mismanagement if any. Details of the same are given in theCorporate Governance Report. The same has also been displayed on the website of theCompany and the link for the same ishttp://www.monnetgroup.com/pdfs/mil/policy/plicy_no_Vigil_Mechanism_and_whistle_blower.pdf.
DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORK PLACE (PREVENTION PROHIBITIONAND REDRESSAL) ACT 2013
The Company has in place a policy on Gender Equality Gender Protection Prevention ofSexual Harassment and Redressal System in line with the requirements of the SexualHarassment of Women at Workplace (Prevention Prohibition and Redressal) Act 2013. AnInternal Complaints Committee (ICC) has been set up to redress complaints receivedregarding sexual harassment. All employees (permanent contractual temporary trainees)are covered under this policy.
No complaints pertaining to sexual harassment were received during FY 2016-17.
PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES
Disclosures pertaining to remuneration and other details as required under Section197(12) of the Act read with Rule 5(1)/(2)/(3) of the Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014 are annexed to this report as Annexure-5.
CORPORATE GOVERNANCE REPORT
Your Company has complied with requirements of Regulation 34 of SEBI (ListingObligations and Disclosure Requirements) Regulations 2015. A report on the CorporateGovernance practices followed by the Company together with a certificate from theCompany's Auditors confirming compliance forms part of this report and annexed as Annexure-6.
24. CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION FOREIGN EXCHANGE EARNING AND OUTGO
Information under Section 134(3)(m) of the Companies Act 2013 read with rule 8(3) ofthe Companies (Accounts) Rules 2014 is given below:
A. Conservation of Energy-The Company has taken a number of steps to improve theconservation of energy by increasing the efficiency of raw material inputs in ferro alloysgeneration and by reducing/eliminating consumption wastages. Conservation of energy andimproving the efficiency of existing resources are continuing processes and form anintegral part of responsibilities of departmental heads and the Company had not made anymajor capital investment on energy conservation equipments.
B. Technology Absorption-
i. Efforts in brief made towards technology absorption
As technologies change rapidly your Company recognizes the need to invest in newemerging technologies to leverage them for improving productivity quality and reach tonew customers. It is essential to have a technology infrastructure that is at par with thebest in the world. Your Company thus follows a practice of upgrading computing equipmenton an ongoing basis.
ii. Benefits derived like product improvement cost reduction product development orimport substitution: NIL
iii. In case of imported technology (imported during the last three financial yearreckoned from the beginning of the financial year)
(a) Technology Imported: NIL
(b) Year of Import: NIL
(c) Whether the technology has fully been absorbed: NIL
(d) If not fully absorbed area where absorption has not taken place and reasonthereof: NIL
iv. Expenditure incurred on Research and Development: NIL
C. Foreign Exchange Earnings And Outgo- Not Applicable
Your Directors take this opportunity to offer their sincere thanks to the variousDepartments of the Central and State Government Financial Institutions Bankers to theCompany all Customers Suppliers and contractors for their continued valued assistanceand support. Your Directors also wish to place on record their appreciation for dedicatedservices rendered by all officers staff and workers of the Company at all levels.