Ladies and Gentlemen
Your Directors have pleasure in presenting 40th ANNUAL REPORT of yourCompany together with the Audited Statement of Accounts and the Auditors' Report forthe Financial Year ended 31st March 2015. The summarized financial results forthe Financial Year are as under:
| ||2014-2015 ||2013-2014 |
| ||(Rs in lakh) ||(Rs in lakh) |
|Gross Profit /(Loss) ||(676.97) ||(374.67) |
|Depreciation ||(417.31) ||(386.44) |
|Profit / ( Loss ) before tax ||(1094.28) ||(761.11) |
|Provision for Income tax ||- ||(1.006) |
|Provision for Fringe Benefit Tax ||- ||- |
|Provision / Release of Deferred Tax ||(11.28) ||236.47 |
|Net profit for the year ||(1083.00) ||(525.64) |
|Balance brought forward from the earlier year ||(219.74) ||305.90 |
| ||(1302.74) ||(219.74) |
PERFORMANCE AND STATE OF COMPANY'S AFFAIRS OF THE COMPANY
During the year under review the Company has incurred net loss Rs.108300000 asagainst loss of Rs52565000 in the previous year. Even though the total revenue of theCompany has increased while comparing the previous year the rise in loss was mainly dueto increase in cost of Power & Fuel etc comparing to the previous year. No materialchanges have occurred or commitments made affecting the financial position of the companybetween the end of the financial year of the company to which the financial statementsrelate and the date of the report
The order book position is comfortable since the Company was able to tie up long termcontracts with the customers. The plant at Pondicherry and Perundurai is also performingat its rated capacity. Your Company is working at its market front since the supply ofoxygen and nitrogen has increased compared to previous year.
The power generation is normal and we expect the generation of power will improve inthe coming months
Considering the current and accumulated losses of your Company the Board of Directorsis not recommending any dividend for the year 2014-2015.
TRANSFER OF PROFITS TO RESERVES
During the year your company has met net loss of Rs . 108300783/- which has beentransferred to reserve account as Rs. Debit balance in statement of profit and loss'
MATERIAL CHANGES AND COMMITMENTS OF THE COMPANY
There were no material changes and commitments affecting the financial position of theCompany between the end of financial year ( March 31 2015 and the date of the Report06.08.2015 )
PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS U/S 186:
Details of loans guarantees and investments covered under the provision of section 186of the companies act 2013 are given below:
|Particulars ||Number ||Amount |
|Loan Given ||NIL ||NIL |
|Investment made || || |
|Unquoted || || |
|Investments in || || |
|Equity Instruments || || |
|i) Pondicherry Agro ||9000 shares ||90000.00 |
|Foods Pvt Ltd ||( Face value Rs.10/- ) || |
|ii) Beta Wind Farm Pvt Ltd ||168421 shares ||3199999.00 |
| ||( Face Value Rs.10/-) || |
|iii)Clarion Wind Farm Pvt Ltd ||231152 Shares ||2311520.00 |
| ||( Face Value Rs.10/- ) || |
|Investment in Govt.Securities || || |
|iv) National Savings Certificate || ||5000.00 |
|v) Indira vikas patra || ||500.00 |
|Guarantee Given ||Nil ||Nil |
SUBSIDIARIES ASSOCIATES AND JOINT VENTURE COMPANIES
The Company doesn't have any subsidiaries associates and joint venture companies
THE CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION FOREIGN EXCHANGE EARNINGS AND OUTGO:
The details of conservation of energy technology absorption foreign exchange earningsand outgo as required under section 134 (3) (m) of the Companies Act 2013 are attached asAnnexure -1:
DIRECTORS AND KEY MANAGERIAL PERSONNEL
|S.No ||Name of Directors ||Designation ||Date of appointment ||Date of resignation |
|1 ||Gajanand Saraf ||Managing Director ||23.12.1974 ||- |
|2 ||Rajesh Kumar Saraf ||Joint Managing Director ||30.11.1992 ||- |
|3 ||Veena Devi Saraf ||Director ||11.10.1989 ||- |
|4 ||Perumal Siva ||Independent Director ||10.01.1994 ||- |
|5 ||Anil Kumar Seth ||Independent Director ||21.08.1985 ||- |
|6 ||Devmohan Mohunta ||Independent Director ||10.11.1987 ||- |
Retirement by Rotation
In terms of Section 152 of the Companies Act 2013 Smt. Veena Devi Saraf Who retire byrotation at the forthcoming AGM and is eligible for re-appointment.
DECLARATION OF INDEPENDENT DIRECTORS
As per the Companies Act 2013 your company had appointed three independent directorsand they have declared that they meet the criteria of independence in terms of Section149(6) of the Companies Act 2013 and that there is no change in their status ofIndependence.
REMUNERATION DETAILS OF DIRECTORS:
|Details of Remuneration to ||Mr.Gajanand Saraf ||Mr.Rajesh Kumar Saraf |
|Directors ||Managing Director ||Joint Managing Director |
|Salary ||3000000/- ||3000000/- |
|PF Contribution ||360000/- ||360000/- |
|Others ||100000/- ||100000/- |
INFORMATION U/s 197 (12) OF THECOMPANIES ACT 2013
The information required under section 197 (12) of the Act and read with rule 5(1) ofthe Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 isattached herewith as Annexure-5.
As per the provisions of the Companies Act 2013 M/s Sing & Co CharteredAccountants had been appointed as the statutory auditors of the Company to hold officefrom the conclusion of the 39th Annual General Meeting held on 12.09.2014 tillthe conclusion of Annual General Meeting to be held in 2017 subject to the ratification ofshare holders in every Annual General Meeting . The company has received confirmation fromthe audit firm regarding their consent and eligibility under sections 139 and 141 of theCompanies Act 2013 read with the Companies ( Accounts ) Rules 2014 for appointment as theAuditors of the Company.
As required under clause 41 of the Listing Agreement the Auditors have also confirmedthat they hold a valid certificate issued by the Peer Review Board of the Institute ofChartered Accountants of India
The Audit committee and the Board of Directors have recommended to ratify theappointment of auditors for the financial year 2015-16. The necessary resolution is beingplaced before the shareholder for their approval.
Pursuant to the requirements of Section 204(1) of the Companies Act 2013 and Rule 9 ofthe Companies ( Appointment and Remuneration of Managerial Personnel ) Rule 2014 thecompany has appointed Mrs Lakshmmi Subramanain & Associates Practicing CompanySecretaries to conduct the secretarial audit for the financial year 2014-15.
The Secretarial Audit report as received from the secretarial auditor is annexed tothis report as Annexure-2
COMMENT ON SECRETARIAL AUDIRTOR REPORT
With reference to the remarks made by the secretarial auditor Mrs. LakshmmiSubramanian Practicing Company Secretary in her secretarial audit report the companyhas taken the corrective measures during the current financial year.
INTERNAL CONTROL AND ITS ADEQUACY
M/s Sivasubramanian & co Cost Accountants was appointed as internal auditors ofthe Company. They regularly conduct audit and submit their quarterly reports which arereviewed by the Audit Committee. The Company has an adequate Internal Control systemcommensurate with the size scale and complexity of its operations. To maintain itsobjectivity and independence the Internal Auditor reports to the Chairman of the AuditCommittee of the Board. During the year such controls were tested and no reportablematerial weaknesses in the design or operation were observed.
RELATED PARTY TRANSACTIONS U/S 188 (1)
There were no materially significant transactions with Related Parties during thefinancial year 2014-15 which were in conflict with the interest of the Company. Suitabledisclosures as required under AS-18 have been made in Note No.37 of the Notes to thefinancial statements. Details of the transactions are provided in Form AOC-2 which isattached as Annexure - 3
The Board had approved the Related Party Transactions.
EXTRACT OF THE ANNUAL RETURN:
The details forming part of the extracts of Annual Return in form MGT-9 as providedunder subsection (3) of section 92 of the Companies Act is annexed herewith as Annexure 4to this report.
RISK MANAGEMENT POLICY
Your Company has an estabilished Enterprise Risk Management function that engages withall the business verticals for risk assessment ensures that the risk mitigation plansare in place and validates the risk mitigation status regularly . Action plans areincorporated into the corporate plans of your company. The steering committee consistingof core Business vertical Heads overseas the Risk Management process including riskidentification impact assessment effective implementation of the mitigation plans andrisk reporting The Committee Chaired by the Managing Director reviews on a quarterlybasis the enterprise risks to the achievement of the business objectives. The steeringCommittee updates the Risk Management committee comprising of independent directors andnon-executive director on the enterprise risks and the action taken thereon
DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION PROHIBITIONAND REDRESSAL) ACT 2013
Your Company has always believed in providing a safe and harassment free workplace forevery individual working in the Company through various interventions and practices. TheCompany always endeavors to create and provide an environment that is free fromdiscrimination and harassment including sexual harassment.
The Company aims at prevention of harassment of employees and lays down the guidelinesfor identification reporting and prevention of undesired behavior. The Board of Directorsare responsible for redressal of complaints related to sexual harassment During the yearended 31 March 2015 the Board did not receive any complaints pertaining to sexualharassment.
DEPOSIT FROM PUBLIC
The Company has not accepted any deposits from public and as such no amount on accountof principal or interest on deposits from public was outstanding as on date of the balancesheet.
CORPORATE GOVERNANCE REPORT
Since your company's paid up capital and Net worth is less than Rs.10 Crores andRs.25 Corers respectively the provisions of revised clause 49 relating to CorporateGovernance vide SEBI circular dated CIR/CFD/POLICY CELL/7 is not applicable to theCompany.
NUMBER OF BOARD MEETINGS HELD DURING THE YEAR ALONG WITH THE DATES OF THE MEETINGS:
During the Financial Year 2014-2015 the Board met 4 times as follows:
|S No. ||Dates of meeting of the Board ||Quarter ||No of directors on the date of meeting ||Total no of directors attended |
|1. ||22.05.2014 ||First ||6 ||6 |
|2. ||28.07.2014 ||Second ||6 ||6 |
|3. ||31.10.2014 ||Third ||6 ||6 |
|4. ||12.02.2015 ||Fourth ||6 ||6 |
The meetings of the Board were held periodically and has not lapsed a period of 120days between two meetings as prescribed under section 173(1) of the Act.
ANNUAL BOARD EVALUATION
The Nomination and Remuneration Committee of the Board laid down the criteria forperformance evaluation of all Directors. The performance evaluation has been done by theentire Board of Directors except the Director concerned being evaluated. The criteria forperformance evaluation are as follows:
Role & Accountability
- Understanding the nature and role of Independent Directors' position
- Understanding of risks associated with the business
- Application of knowledge for rendering advice to management for resolution ofbusiness issues
- Offer constructive challenge to management strategies and proposals
- Active engagement with the management and attentiveness to progress of decisionstaken
- Non-partisan appraisal of issues
- Own recommendations given professionally without tending to majority or popularviews
Leadership & Initiative
- Heading Board Sub-committees
- Driving any function or identified initiative based on domain knowledge andexperience
- Commitment to role & fiduciary responsibilities as Board member
- Attendance and active participation
- Proactive strategic and lateral thinking
CODE OF CONDUCT FOR DIRECTORS AND SENIOR MANAGEMENT
The Board of Directors had adopted a Code of Conduct for the Board Members andemployees of the company. This code helps the Company to maintain the standard of businessethics and ensure compliance with the legal requirements of the company
The code is aimed at preventing any wrongdoing and promoting ethical conduct at theBoard and employees. The Compliance officer is responsible to ensure adherence to the Codeby all concerned
The code lays down the standard of conduct which is expected to be followed by theDirectors and the designated employees in their business dealings and in particular onmatters relating to integrity in the work place in business practices and in dealing withstakeholders
All the Board Members and the Senior Management personnel have confirmed compliancewith the Code
WHISTLE BLOWER POLICY/VIGIL MECHANISM
Pursuant to section 177(9) of the Companies Act 2013 read with Rule 7 of the Companies( Meetings of Board and its Powers ) Rules2014 and clause 49 of the Listing Agreementthe Board of Directors had approved the policy on vigil mechanism / whistle blower and thesame was hosted on the website of the Company. The policy inter-alia provides a directaccess to the Chairman of the Audit Committee.
Your Company hereby affirms that no Director / employee has been denied access to theChairman of the Audit Committee and that no complaints were received during the year
The Board had constituted the following committees Viz Audit Committee Nomination andRemuneration Committee and Stakeholders' Relationship Committee
The Audit Committee which acts as a link between the management external and internalauditors and the Board of Directors of the Company is responsible for overseeing theCompany's financial reporting process by providing direction to audit function andmonitoring the scope and quality of internal and statutory audits.
The Audit Committee comprises of Mr. P.Siva Independent Director as Chairman Mr.AnilKumar Seth and Mr. D.M.Mohunta Independent Directors as members.
All members of the Audit Committee are financially literate and have expertise inaccounting / financial management.
The Chairman of the Audit Committee was present at the last Annual General Meeting heldon 12th September 2014
The Audit Committee met five times during the year and the time gap between any twomeeting did not exceed more than four months
|Date of Meetings ||Total number of members ||No.of members present |
|22.05.2014 ||3 ||3 |
|28.07.2014 ||3 ||3 |
|31.10.2014 ||3 ||3 |
|12.02.2015 ||3 ||3 |
Terms of reference in brief
Review of the quarterly / half-yearly / annual financial statements withreference to changes if any in accounting policies and reasons for the same
Major accounting entries involving estimates based on exercise of judgment bymanagement adjustments if any arising out of audit findings.
Compliance with listing and legal requirements relating to financial statementsqualifications if any in the draft audit report.
Internal controls and risk management
Review of internal audit function and discussion on internal audit reports
Review of vigil mechanism and above all adequacy of internal control systems
Review of risk management policies especially enterprise level risk management
Compliance and other related aspects
Disclosure of related party transactions and subsequent modifications if any.
Scrutiny of inter-corporate loans and investments
valuation of undertakings or assets of the company
uses/application of funds raised through an issue
Review and recommendation of appointment remuneration and terms of appointmentof statutory auditors
Review of other services rendered by the statutory auditors
Review of the management discussion and analysis of the financial conditions andresults of operations significant related party transactions management letters issuedby statutory auditors internal audit reports
The audit Committee also looks into the matters as are specifically referred to it bythe Board of Directors besides looking into the mandatory requirements of the ListingAgreement and provisions of Section 177 of the Companies Act 2013.
NOMINATION AND REMUNERATION COMMITTEE:
The Nomination and Remuneration committee comprises of Mr. P.Siva Independent Directoras Chairman Mr.Anil Kumar Seth and Mr. D.M.Mohunta Independent Directors as members.
Terms of Reference
The Committee shall formulate the criteria for determining the qualificationpositive attributes and independence of a director and recommend to the Board a policyrelating to the remuneration for the directors key managerial personnel and otheremployees.
The Committee shall identify persons who are qualified to become directors andwho may be appointed in senior management positions in accordance with the criteria laiddown recommend to the Board their appointment and removal and shall carry out evaluationof every director's performance.
The Committee shall ensure that level and composition of remuneration isreasonable and sufficient relationship of remuneration to performance is clear and meetsperformance benchmarks and involves a balance between fixed and incentive pay.
Review the policy from time to time for selection and appointment of Directorsand senior management employees and their remuneration;
Review the performance of the Board of Directors and Senior Management Employeesbased on certain criteria as approved by the Board. In reviewing the overall remunerationof the Board of Directors and Senior Management the Committee ensures that theremuneration is reasonable and sufficient to attract retain and motivate the bestmanagerial talent the relationship of remuneration to performance is clear and meetsappropriate performance benchmarks and that the remuneration involves a balance betweenfixed and incentive pay reflecting short term and long term objectives of the Company.
Filling up of vacancies in the Board that might occur from time to time andappointment of additional Non-Executive Directors. In making these recommendations theCommittee shall take into account the special professional skills required for efficientdischarge of the Board's functions.
Recommendation to the board with regard to retirement of Directors liable toretire by rotation and appointment of Executive Directors.
To determine and recommend to the Board from time to time
(a) The amount of commission and fees payable to the Directors within the applicableprovisions of the Companies Act 2013.
(b) The amount of remuneration including performance or achievement bonus andperquisites payable to the Executive Directors
(c) To frame guidelines for Reward Management and recommend suitable schemes for theExecutive Directors and Senior Management.
To determine the need for key man insurance for any of the company'spersonnel
To carry out the evaluation of every director's performance
To carry out any function as is mandated by the Board from time to time and /orenforced by any statutory notification amendment or modifications as may be applicable.
Stakeholders' Relationship Committee
(C) Meetings and attendance during the year:
There is no meeting held during the year.
(D) Remuneration policy
The Board has on the recommendation of the Nomination & Remuneration Committeeapproved a policy for selection and appointment of Directors Senior Management and fordetermining their remuneration.
STAKE HOLDERS RELATIONSHIP COMMITEE
The Stakeholders Relationship Committee specifically looks into issues such asredressing of shareholders' and investors' complaints such as transfer ofshares non-receipt of shares non-receipt of declared dividends and ensuring expeditiousshare transfers and also redresses the grievances of deposit holders debenture holdersand other security holders.
(A) Composition Members its meetings and attendance
This Committee comprises of Mrs. Veena Devi Saraf as Chairman with Mr.Gajanand Sarafand Mr. P.Siva as members of the Committee.
During the yearsix meetings of Stake holders Relationship Committee were held asfollows;
|Name of Member ||Category ||Meetings held during FY 2015 ||Meetings attended |
|Mrs. Veena Devi Saraf ||Non-executive Director/ Chairman ||6 ||6 |
|Mr. Gajanand Saraf ||Managing Director ||6 ||6 |
|Mr.P.Siva ||Independent Director ||6 ||6 |
CORPORATE SOCIAL RESPONSIBILITY ( CSR )
Your company is not mandatorily required to constitute CSR committee since it has notcome within the purview of threshold limit specified in section 135 of the Companies Act2013.
DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS/ COURTS/ TRIBUNALSIMPACTING THE GOING CONCERN STATUS AND COMPANY'S OPERATIONS IN FUTURE:
During the year there were no such instances of significant and material orders passedby the regulators courts or tribunals.
DIRECTORS' RESPONSIBILITY STATEMENT:
As required under Section 134 (5) of the Companies Act 2013 the Board of Directorshereby confirm:-
(i) That in the preparation of the Annual Accounts the applicable accounting standardshad been followed along with proper explanation relating to material departures;
(ii) That the Directors had selected such accounting policies and applied themconsistently and made judgments and estimates that are reasonable and prudent so as togive a true and fair view of the state of the affairs of the Company at the end of theFinancial Year and of the profit of the Company for that period;
(iii) That the Directors had taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with the provisions of the Act for safeguardingthe assets of the Company and for preventing and detecting fraud and other irregularities;
(iv) That the Directors had prepared the Annual Accounts on a going-concern basis;
(v) That proper internal financial controls were followed by the Company and that suchinternal financial controls are adequate and were operating effectively.
(vi) That the directors had devised proper systems to ensure compliance with theprovisions of all applicable laws and that such systems were adequate and operatingeffectively.
|GENERAL INFORMATION || |
|AGM Date Time and Venue ||26th September 2015 at 9.30 a.m |
| ||Hotel Kanchi |
| ||No.28 Ethiraj Salai Egmore |
| ||Chennai-600 008 |
|Financial Calendar || |
|1st Quarter ||1st April to 30th June |
|2nd Quarter ||1st July to 30th September |
|3rd Quarter ||1st October to 31st December |
|4th Quarter ||1st January to 31st March |
|Date of Book Closure ||19.9.2015 to 26.9.2015 |
|Record Dates ||19.9.2015 |
|Dividend Payment date ||Not applicable |
|Listing with Stock Exchanges ||Bombay Stock Exchange |
|Address of the Registered office ||No.80 ( Old No.141 ) Greams Road |
| ||Opp. to Greams Road Post Office |
| ||Chennai |
| ||Tamilnadu 600006 |
|E-mail id ||firstname.lastname@example.org |
|Web Site ||wwwnolgroup.com |
Your Directors would like to express their sincere appreciation of the co-operation andassistance received from the business constituents during the year under review.
| || ||By Order of the Board |
|Place : Chennai ||Sd/- ||Sd/- |
|Date : 06.08.2015 ||Rajesh Kumar Saraf ||G.N.Saraf |
| ||Joint Managing Director ||Managing Director |
| ||DIN:-00007353 ||DIN:-00007320 |
Details relating to Conservation of Energy Technology Absorption Foreign ExchangeEarnings and Outgo:
(A) Conservation of energy
(i) Introduction of efficient lighting system and special capacitor banks forimprovement of power factor
(ii) Improvements in operating efficiency and reduction of losses at workers level
(iii) Technology for production of gases is being upgraded continuously. Alsodistribution technology for cryogenic liquid products is streamlined
(iv) Capital investment on energy conservation equipments: NIL
|(B) Technology absorption || |
|(i) The efforts made towards technology absorption: ||NIL |
|(II) Benefits derived || |
|Production improvement : ||NIL |
|Cost Reduction: ||NIL |
|Product development or Import substitution ; ||NIL |
|(III) Imported Technology ; ||NIL |
|(iv) Expenditure Incurred on Research and Development ; ||NIL |
(C) Foreign exchange earnings and outgo:
| ||2014-15 ||2013-14 |
|Earnings in Foreign Exchange : ||NIL ||NIL |
|Expenditure in Foreign Exchange ||NIL ||NIL |
|CIP Value of imports ||NIL ||Rs.11694084/- |
| || ||On behalf of the Board |
| ||Sd/- ||Sd/- |
|Chennai ||Rajesh Kumar Saraf ||G.N.Saraf |
|Date : 06.08.2015 ||Joint Managing Director ||Managing Director |
| ||DIN:-00007353 ||DIN:-00007320 |