Naraingarh Sugar Mills Ltd.
|BSE: 531457||Sector: Agri and agri inputs|
|NSE: N.A.||ISIN Code: INE491E01015|
|BSE LIVE 05:30 | 01 Jan||Stock Is Not Traded.|
|NSE 05:30 | 01 Jan||Stock Is Not Traded.|
|BSE: 531457||Sector: Agri and agri inputs|
|NSE: N.A.||ISIN Code: INE491E01015|
|BSE LIVE 05:30 | 01 Jan||Stock Is Not Traded.|
|NSE 05:30 | 01 Jan||Stock Is Not Traded.|
The Shareholders of
Naraingarh Sugar Mills Limited Naraingarh
Your Directors are pleased to present the 23rd Annual report of your company alongwithaudited annual accounts of the company for the period ended 31st March 2016.
OPERATIONS & FINANCIAL RESULTS
It is informed that during the current nancial year the company achieved a total incomeof Rs. 16898.08 Lacs which is approximately 47.25% higher than the previous year gure ofRs 11475.80 Lacs. The company suffered a net loss after tax of Rs. 492.46 Lacs compared tonet loss after tax and recovery of Rs. 2000.51 lacs during last nancial year mainly due toimprovement in the market price of sugar during the year. The comparative gures of Canecrushed and recovery during the current year and last year are given hereunder:-
Your company had been in turbulent time during the last few years due to worseningdomestic and international market condition of sugar prices which led to losses in thelast few nancial years. However the management is taking keen interest in upgrading thetechnology and performance of the sugar manufacturing unit. As a part of the modernizationand expansion plan the company increased its installed capacity from 3500 TCD to 4000 TCDin the last nancial year itself.
The company's 25MW capacity Bagasse based cogeneration power plant is at nal stages ofcompletion and is expected to be operational in the current crushing season. Besides thecompany is also in the process to enhance the crushing capacity to 5500 TCD from theexisting 4000 TCD before the start of 2017-18 crushing season.
The proposed integrated project shall improve the quality of sugar for meeting thenational and international standards while operating at optimum levels thereby reducingthe manufacturing costs and shall also provide raw material for the upcoming co-gen powerplant in the form of Bagasse. In other words this expansion and modernization programshall lend a new lease of life to the sugar factory.
Your Board hopes to improve in the years to come in the way of above mentionedmodernization cum expansion project.
THE BOARD DIRECTORS
Change in Directorship & KMP
Mr. Sandeep Singh was appointed as the additional director on 14th August 2015 andregularized in the Annual General Meeting further he was promoted as the whole timeDirector of the company w.e.f 17thOctober 2015 and seeks regularization in this AnnualGeneral Meeting.
Mr. Jitendra Anand Executive Director of the company had resigned from the said postw.e.f 22nd July 2015
Mr. Baldev Singh Kang and Mrs. Ravinder Kaur Kang did not attend any board meetingduring the Financial Year and thus their of ce stands vacated by the virtue of Section 167of Companies Act 2013 on 13th August 2015
Mr.AmanHanda Independent Director of the company had resigned from the said post w.e.f25th August 2016.
Mr. Yogesh Jain was appointed as the Additional Director of the company w.e.f3rdSeptember 2016 and seeks regularization in this Annual General Meeting.
Mrs.Diksha Dhamija resigned as the Company secretary on 1st October 2015 and Mr VijayKumar was appointed wef 1st October 2015.
Pursuant to the provisions of the Companies Act 2013 and SEBI (Listing Obligations andDisclosure Requirements) Regulations2015 a system has been put in place to carry outperformance evaluation of the Board its Committees and individual Directors.Criteria forperformance evaluation is covered in the Corporate Governance Report
Directors to retire by rotation
In terms of Articles of association of the company Mr. Sandeep Singh shall retire byrotation and being eligible offers himself for re-appointment at the ensuing annualgeneral meeting.
DIRECTORS' RESPONSIBILITY STATEMENT
Following is the Directors' Responsibility Statement as required under section 134(4)of the Companies Act 2013 in respect of the Financial Statements the directors con rmthat : a) in the preparation of Annual Accounts for the nancial year ended 31st March2016 the applicable accounting standards have been followed; b) in the selection ofaccounting policies consulted the Statutory Auditors and applied them 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 as at 31st March 2016 and of the pro t of theCompany for the year ended on that date; c) proper and suf cient care has been taken formaintenance of adequate accounting records in acordance with the provisions of theCompanies Act 2013 for safeguarding the assets of the Company and for preventing anddetecting fraud and irregularities; d) the Annual Accounts have been prepared on a goingconcern basis; e) internal nancial controls to be followed by the Company have been laiddown which are adequate and operating effectively; f) proper systems have been devised toensure compliance with the provisions of all applicable laws and such systems are adequateand operating effectively.The directors had devised proper systems to ensure compliancewith the provisions of all applicable laws and that such systems were adequate andoperating effectively
DECLARATION BY INDEPENDENT DIRECTORS
The Company has received declarations from all the Independent Directors of the Companycon rming that they meet the criteria of independence as prescribed both under theCompanies Act 2013 and Regulation 16 of SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015.
Remuneration to Executive Directors:
The remuneration paid to Executive Directors is recommended by the Nomination andRemuneration Committee and approved by the Board in Board meeting subject to thesubsequent approval of the shareholders at the General Meeting and such other authoritiesas may be required. The remuneration is decided after considering various factors such asquali cation experience performance responsibilities shouldered industry standards aswell as nancial position of the Company.
This Nomination Remuneration and Evaluation Policy (the "Policy") applies tothe Board of Directors (the "Board") of
NARAINGARH SUGAR MILLS LIMITED (the "Company").
This Policy is in compliance with Section 178 of the Companies Act 2013 read alongwith the applicable rules thereto .The primary objective of the Policy is to provide aframework and set standards for the nomination remuneration and evaluation of theDirectors and of cials as may be prescribed. The Company aims to achieve a balance ofmerit experience and skills amongst its Directors and Senior Management.
1.1 The Board is ultimately responsible for the appointment of Directors and KeyManagerial Personnel.
1.2 The Board has delegated responsibility for assessing and selecting the candidatesfor the role of Directors to the Nomination and Remuneration Committee which makesrecommendations & nominations to the Board.
2. Nomination and Remuneration Committee
The Nomination and Remuneration Committee is responsible for:
2.1. reviewing the structure size and composition (including the skills knowledge andexperience) of the Board at least annually and making recommendations on any proposedchanges to the Board to complement the Company's corporate strategy with the objective todiversify the Board; 2.2. recommending to the Board on the selection of individualsnominated for directorship; 2.3. making recommendations to the Board on the remunerationpayable to the Directors so appointed/reappointed; 2.4. assessing the independence ofindependent directors; 2.5 such other key issues/matters as may be referred by the Boardor as may be necessary in view of the provision of the Companies Act 2013 and Rules thereunder.
2.6 to make recommendations to the Board concerning any matters relating to thecontinuation in of ce of any Director at any time including the suspension or terminationof service of an Executive Director as an employee of the Company subject to the provisionof the law and their service contract 2.7 ensure that level and composition ofremuneration is reasonable and suf cient relationship of remuneration to performance isclear and meets appropriate performance benchmarks;
The Nomination and Remuneration Committee comprises of the following:
a) The Committee shall consist of a minimum 3 non-executive directors majority of thembeing independent.
b) Minimum two (2) members shall constitute a quorum for the Committee meeting.
c) Membership of the Committee shall be disclosed in the Annual Report.
d) Term of the Committee shall be continued unless terminated by the Board ofDirectors.
a) Chairman of the Committee shall be an Independent Director.
b) In the absence of the Chairman the members of the Committee present at the meetingshall choose one amongst them to act as Chairman.
c) Chairman of the Nomination and Remuneration Committee meeting could be present atthe Annual General Meeting or may nominate some other member to answer the shareholders'queries.
COMMITTEE MEMBERS' INTERESTS
a) A member of the Committee is not entitled to be present when his or her ownremuneration is discussed at a meeting or when his or her performance is being evaluated.
b) The Committee may invite such executives as it considers appropriate to be presentat the meetings of the Committee.
a) Matters arising for determination at Committee meetings shall be decided by amajority of votes of Members present and voting and any such decision shall for allpurposes be deemed a decision of the Committee.
b) In the case of equality of votes the Chairman of the meeting will have a castingvote.
4. Appointment of Directors
4.1 Enhancing the competencies of the Board and attracting as well as retainingtalented employees for role of directors and at other senior positions in management arethe basis for the Nomination and Remuneration Committee to select a candidate forappointment to the Board. When recommending a candidate for appointment the Nominationand Remuneration Committee has regard to: assessing the appointee against a range ofcriteria which includes but not be limited to quali cations skills regional and industryexperience background and other qualities required to operate successfully in theposition with due regard for the bene ts from diversifying the Board; the extent to whichthe appointee is likely to contribute to the overall effectiveness of the Board workconstructively with the existing directors and enhance the ef ciencies of the Company; theskills and experience that the appointee brings to the role of a director and how anappointee will enhance the skill sets and experience of the Board as a whole; the natureof existing positions held by the appointee including directorships or other relationshipsand the impact they may have on the appointee's ability to exercise independent judgment;
4.2 Personal speci cations:
Degree holder in relevant disciplines;
Experience of management in a diverse organization;
Excellent interpersonal communication and representational skills;
Demonstrable leadership skills;
Commitment to high standards of ethics personal integrity and probity;
Commitment to the promotion of equal opportunities community cohesion andhealth and safety in the workplace;
Having continuous professional development to refresh knowledge and skills.
5.Remuneration of Directors
The guiding principle is that the level and composition of remuneration shall bereasonable and suf cient to attract retain and motivate Directors. The Directors' salaryshall be based & determined on the individual person's responsibilities andperformance and in accordance with the limits as prescribed statutorily if any.
The Nominations & Remuneration Committee determines individual remunerationpackages for Directors of the Company taking into account factors it deems relevantincluding but not limited to market business performance and practices in comparablecompanies having due regard to nancial and commercial health of the Company as well asprevailing laws and government/other guidelines.
The Committee consults with the Chairman of the Board as it deems appropriate.
a) Base Compensation ( xed salaries) Must be competitive and re ective of theindividual's role responsibility and experience in relation to performance of day-to-dayactivities usually reviewed on an annual basis; (includes salary allowances and otherstatutory/non-statutory bene ts which are normal part of remuneration package in line withmarket practices
b) Variable salary: The Nomination and Remuneration Committee may in its discretionstructure any portion of remuneration to link rewards to corporate and individualperformance ful llment of speci ed improvement targets or the attainment of certainnancial or other objectives set by the Board. The amount payable is determined by theCommittee based on performance against pre-determined nancial and non- nancial metrics.
ii) Statutory Requirements:
Section 197(5) provides for remuneration by way of a fee to a director for attendingmeetings of the Board of Directors and Committee meetings or for any other purpose as maybe decided by the Board.
Section 197(1) of the Companies Act 2013 provides for the total managerialremuneration payable by the Company to its directors including managing director andwhole time director and its manager in respect of any nancial year shall not exceedeleven percent of the net pro ts of the Company computed in the manner laid down inSection 198 in the manner as prescribed under the Act. The Company with the approval ofthe Shareholders and Central Government may authorise the payment of remunerationexceeding eleven percent of the net pro ts of the company subject to the provisions ofSchedule V. The Company may with the approval of the shareholders authorise the payment ofremuneration upto ve percent of the net pro ts of the Company to its anyone ManagingDirector/Whole Time Director/Manager and ten percent in case of more than one such ofcial. The Company may pay remuneration to its directors other than Managing Director andWhole Time Director upto one percent of the net pro ts of the Company if there is amanaging director or whole time director or manager and three percent of the net pro ts inany other case. The net pro ts for the purpose of the above remuneration shall be computedin the manner referred to in Section 198 of the Companies Act 2013
6. Independent Directors
6.1. The Independent Directors shall not be entitled to any stock option and mayreceive remuneration by way of fee for attending meetings of the Board or Committeethereof or for any other purpose as may be decided by the Board and pro t relatedcommission as may be approved by the members.
The sitting fee to the Independent Directors shall not be less than the sitting feepayable to other directors.
6.2. The remuneration payable to the Directors shall be as per the Company's policy andshall be valued as per the Income Tax Rules.
7. Evaluation/ Assessment of Directors of the Company
The evaluation/assessment of the Directors of the Company is to be conducted usually onan annual basis.The following criteria may assist in determining how effective theperformances of the Directors have been:
Leadership & stewardship abilities
contributing to clearly de ne corporate objectives & plans
Communication of expectations & concerns clearly with subordinates
obtain adequate relevant & timely information from external sources.
regular monitoring of corporate results against projections
identify monitor & mitigate signi cant corporate risks
assess policies structures & procedures
direct monitor & evaluate senior of cials
review management's succession plan
Evaluation on the aforesaid parameters will be conducted by the Independent Directorsfor each of the Executive/Non-Independent Directors in a separate meeting of theIndependent Directors. The Executive Director/Non-Independent Directors along with theIndependent Directors will evaluate/assess each of the Independent Directors on theaforesaid parameters. Only the Independent Director being evaluated will not participatein the said evaluation discussion.
Personal Speci cation for Directors
1. Quali cation - Degree holder in relevant disciplines (e.g. management accountancylegal); or - Recognized specialist
2. Experience - Experience of management in a diverse organisation - Experience inaccounting and nance administration corporate and strategic planning or fund management- Demonstrable ability to work effectively with a Board of Directors
3. Skills - Excellent interpersonal communication and representational skills -Demonstrable leadership skills - Extensive team building and management skills - Strong inuencing and negotiating skills - Having continuous professional development to refreshknowledge and skill.
4. Abilities and Attributes - Commitment to high standards of ethics personalintegrity and probity - Commitment to the promotion of equal opportunities communitycohesion and health and safety in the workplace
5. Political inclinations and opinions.
M/s Vasudeva& Associates Chartered Accountants (ICAI Registration No. 022239N)were re-appointed as the Statutory Auditors of the Company to hold of ce from theconclusion of the 21stAnnual General Meeting (AGM) held on 30th September 2014 until theconclusion of the third consecutive AGM of the Company to be held in the year 2017(subject to rati cation of their appointment by the Members at every AGM held after theAGM held on 30th September 2014).
As required under the provisions of section 139(1) of the Companies Act 2013 theCompany has received a written consent from M/s Vasudeva& Associates CharteredAccountants to their appointment and a Certi cate to the effect that their appointmentif made would be in accordance with the Companies Act 2013 and the Rules framedthereunder and that they satisfy the criteria provided in section 141 of the CompaniesAct 2013.
The Members are requested to ratify the appointment of the Statutory Auditors asaforesaid and x their remuneration. The Auditors' Report does not contain any qualication reservation or adverse remark.
M/s Khushwinder Kumar & Co. Cost Accountants Jalandhar were appointed as CostAuditors for the nancial year ended 31st March 2016. Their report shall be submitted tothe Department of Company Affairs Government of India in accordance with the requirementsof law.
Pursuant to the provisions of section 204 of the Companies Act2013 and the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 the Company hasappointed M/s A. Arora & Co Company Secretary (Certi cate of Practice Number: 993) toundertake the Secretarial Audit of the Company.
In terms of provisions of sub-section 1 of section 204 of the Companies Act 2013 theCompany has annexed to this Board Report as Annexure A a Secretarial Audit Report givenby the Secretarial Auditor.
There are certain quali cations in the secretarial Audit Report explained as follows:
1. The company is suspended since more than 7 years now and hence the trading is closedtherefore no insider trading regulations were adopted.
2. As per the sanction letter the charge had to be created after clearance from specied authorities. As the company has not yet receceived the required clearances the companycould not create charge in ROC. The returns shall be led in due course of time
3. Although the company is following majority of the regulations of SEBI (ListingObligation and Disclosure Requirements) Regulations 2015 and in process of takingcorrective measures for the irregularities quali ed by the auditors.
4. the company is in the process of taking corrective measures.
TRANSFER TO RESERVES IN TERMS OF SECTION 134 (3) (J) OF THE COMPANIES ACT 2013
For the nancial year ended 31st March 2016 the Company did not transfer any sum tothe General Reserve Account due to heavy loss suffered during the period.
Keeping in view the nancial constraints of the company your directors have decided notto recommend any dividend for the year under review.
LOANS GUARANTEES AND INVESTMENTS
The Company has following Loans Guarantee given and Investments made under section 186of the Companies Act 2013 for the nancial year ended 31st March 2016:
RELATED PARTY TRANSACTIONS
All related party transactions entered during the year were in Ordinary course ofbusiness and on Arm's Length basis. Further all the necessary details of transactionsentered with the related parties are attached herewith in form no. AOC-2 for your kindperusal and information.(Annexure: B).
The company has not invited any public deposits under section 58A 58AA of theCompanies Act 1956 during the nancial year under review.
The Directors wish to place on record their appreciation of the earnest efforts andcontributions made by employees at all level for the smooth operation of the company.
IINTERNAL FINANCIAL CONTROLS
Your Company has in place adequate internal nancialcontrols with reference to nancialstatements commensuratewith the size scale and complexity of its operations. During theyear such controls were tested and no reportable material weaknesses in the design oroperation were observed.
Your Company has a rich legacy of ethical governance practicesmany of which wereimplemented by the Company even before they were mandated by law. Your Company iscommitted totransparency in all its dealings and places high emphasis on business ethics.A Report on Corporate Governance alongwith a Certi cate from the Statutory Auditors of theCompany regarding compliance with the conditions of Corporate Governance as stipulatedunder Clause 49 of the Listing Agreement form part of this Annual Report.
The Vigil Mechanism as envisaged in the Companies Act 2013 the rules prescribedthereunder and the Listing Agreement is implemented through the Company's Whistle BlowerPolicyto enable the Directors and employees of the Company to report genuine concerns toprovide for adequate safeguards against victimisation of persons who use such mechanismandmake provision for direct access to the Chairman of the AuditCommittee.
DETAILS ABOUT THE POLICY DEVELOPED AND IMPLEMENTED BY THE COMPANY ON CORPORATE SOCIALRESPONSIBILITY INITIATIVES TAKEN DURING THE YEAR
The provisions of section 135 of the Companies Act 2013 regarding CorporateResponsibility Policy are not applicable to the company.
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION
The particulars as required under section 134(3)(m) of the Companies Act 2013 theinformation relating to conservation of energy and technology absorption and ForeignExchange earning and Outgo forms an integral part of this report and is annexed asAnnexure C.
We take this opportunity to acknowledge our deep senses of gratitude to all bankscentral/state government departments and other local authorities for unstinted andcontinued guidance and support. Our gratitude is also due to the shareholders for the condence and faith they have reposed in us.