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Noble Explochem Ltd.

BSE: 506991 Sector: Industrials
NSE: N.A. ISIN Code: INE875D01011
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VOLUME 1700
52-Week high 12.88
52-Week low 2.94
P/E
Mkt Cap.(Rs cr) 10
Buy Price 0.00
Buy Qty 0.00
Sell Price 5.28
Sell Qty 400.00
OPEN 5.28
CLOSE 5.28
VOLUME 1700
52-Week high 12.88
52-Week low 2.94
P/E
Mkt Cap.(Rs cr) 10
Buy Price 0.00
Buy Qty 0.00
Sell Price 5.28
Sell Qty 400.00

Noble Explochem Ltd. (NOBLEEXPLOCHEM) - Director Report

Company director report

To

The Members

The Directors present herewith the Thirty Third Annual Report together with theStatement of Accounts for the year ended 31st March 2015

Financial Performance and Review:

(Rs. in lakhs)

PARTICULARS 2013 - 2014 2014 - 2015
Income:
Other Income 8.70 0.06
Less: Expenses 83.68 81.54
Gross Profit/(Loss) before depreciation/ Interest and Tax (74.98) (81.48)
Less : Interest and Finance Charges 24.97 1.08
Profit/ (loss) before Tax (99.95) (82.56)
Add/Less: prior period adjustment 0 0
Less : Extra Ordinary Items 0 0
Less: Provision for Income tax /Def. Tax release/Wealth Tax 0.09 0.12
Net Profit/(Loss) for the year (100.04) (82.68)
Add: Balance brought forward from previous year (7351.59) (7451.64)
Profit/(loss) carried to Balance sheet (7451.64) (7534.32)

During the year under review there was no turnover as there was no production activityundertaken by the Company. The Company is already declared as Sick Industrial Unit by theBoard of Industrial and Financial Reconstruction New Delhi. The Draft RehabilitationScheme (DRS) is submitted to BIFR and said scheme is expected to be finalised in thefinancial year 2015-16.

Dividend

In view of continuous incurring of losses no dividend is proposed for the year underreport.

Pursuant to the provisions of Investor Education and Protection Fund (Uploading ofinformation regarding unpaid and unclaimed amounts lying with companies) Rules 2012 theCompany had transferred the unpaid and unclaimed amounts of dividend (Rs. 3.89 Lacs) lyingwith the Company to the Investors Education Fund Account established by CentralGovernment.

Transfer to General Reserves:

The Company’s production is held up this financial year also. There was noturnover hence company is incurring losses. Therefore it is not proposed to transfer anyamount to General Reserves.

Material Changes during the period of Financial Statements and Board’s ReportDate:

There is no any material change in the financial position of the Company during theperiod from the date of financial Statement and date of this Directors’ Report.

Directors

During the year under review Smt. Vinda Warhadpande was appointed with effect from 1stOctober 2014 as a woman Director and whole time Director on the Board with the designationas Director - HR and Systems

Shri Rajesh Joshi Director retires by rotation at the General Body Meeting and beingeligible offers himself for reappointment. The Directors recommends re-appointment of ShriRajesh Joshi. Brief resume of the appointee Director is given in the section on CorporateGovernance in the Annual Report.

Declaration By Independent Directors:

The Independent Directors have submitted their disclosure to the Board that they fulfilall requirements as to qualify for their appointment as an Independent Director under theprovisions of the Companies Act 2013 and Clause 49 of the Listing Agreement.

Board Meetings:

During the year under review the Board meets four times the details of which are givenin the Corporate Governance Report which forms part of this report.

Policy On Appointment And Remuneration To Directors

The current policy of the Company on appointment and remuneration of Directors is tohave an appropriate mix of Executives non-executives and Independent Directors on theBoard of the Company. As on 31st March 2015 the Company has 7 members on theBoard of Directors of which 3 are executive Directors two non-executive non independentDirectors and two Independent Directors. More details are given in the CorporateGovernance Report which is part of this Report.

Directors’ Responsibility Statement

Pursuant to the provisions of Section 134 (5) of the Companies Act 2013 the Boardconfirm and submit-

(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 affairs of the Company at the end of thefinancial year and of the loss 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 this 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 being the listed Company the directors had laid down the internal financialcontrols to be followed by the Company and that such Internal Financial Controls areadequate and were operating efficiently.

(vi) That the Directors had devised proper systems to ensure compliance with theprovisions of all applicable laws and that such systems were adequate and operatingefficiently.

Listing:

The Equity Shares of the Company are listed on the Bombay Stock Exchange Limited (BSE).

Corporate Governance

Pursuant to clause 49 of the Listing Agreement with the Stock Exchange Reports onManagement Discussion & Analysis and on Corporate Governance along with a certificatefrom the Auditors and CEO / CFO are attached hereto and form part of this report.

Statutory Auditors:

M/s Amar Bafna & Associates Mumbai were appointed as Statutory Auditors of theCompany in the last Annual General Meeting of the Company for the period of two years i.e. for the financial year 2014-15 and 2015-16. The appointment of Statutory Auditors is tobe ratified by the members in Annual General Meeting. The Company has received the consentletter from the Auditors in this behalf. You are requested to appoint Auditors and to fixtheir remuneration.

Auditor’s Report

The Auditor’s Report is self explanatory except the following qualificationsmentioned in the report:

1. As explained in Note No. 21 of Notes to Accounts the expenses / liabilitiesaggregating Rs. 154.74 lacs for the year 2014-2015 have not been provided due to whichcurrent year loss and accumulated losses are under stated by Rs. 131.32 Lacs.

2. As explained in Note No. 24 of Notes to Accounts calls in arrears is unreconciledto the extent of Rs. 2.25 Lacs.

3. As explained in Note No. 26 of Notes to Accounts no provision has been madefor loans and advances amounting to Rs. 109.94 lacs which are prima facie doubtful ofrecovery and in our opinion current year’s loss and accumulated losses of the companyare under stated by provision of such doubtful advances

4. Depreciation on tangible and intangible assets (as per Schedule II of Companies Act2013) has not been provided. (Refer Note NO. 22)

5. As explained in Note No 25 the liability on account of non-fulfillment ofexport obligation has not been considered since not ascertainable.

6. Attention is also invited in respect of share application money received by theCompany which is pending for allotment in terms of Section 73 of the Companies Act 2013read with Companies (Acceptance of Deposits) Amendment Rules 2015

On these points the Board submit the following explanation:

1. The Company’s operations have been suspended due to shortage of Raw MaterialLabour Unrest shortage of working Capital finance etc. But the administrative operationsof the Company are continued up to date. Due to stoppage of production the requiredfinancial resource could not generate and Company is incurring losses mainly due toadministrative Expenses. The Company has been declared a Sick Industrial Unit by the Boardfor Industrial and Financial Reconstruction (BIFR) and the draft rehabilitation scheme hasbeen submitted to BIFR through IDBI Bank - the Operating Agency and on sanction of thesame it will be possible to restart the activities.

2. The Call in arrears for Rs. 2.25 Lacs remains to be un-reconciled for want of non-availability of requisite data from Registrar and Share T ransfer Agents.

3. No provision has been made for loans and advances amounting to Rs. 109.94 Lacsrepresenting advances given to suppliers deposit with statutory authorities. TDS paymentsas the same are considered to be good and either receivable or adjustable in near future

4. No provision for Depreciation on fixed assets has been made after discontinuingoperation of the company since December 2006 as the relevant assets are not in use.

5. In respect of non-fulfilment of export obligation the Management 0f the Company hadmade an application to the Export Department for the extension of time of 5 years fromthe date of sanction of Rehabilitation Scheme by the BIFR for fulfilment of exportObligation promised.

6. The Company was declared as Sick Industrial Unit by the BIFR in the year 2011 and asper the Draft rehabilitation Scheme submitted to the Hon’ble BIFR the company isreceiving the Share Application money from one or two parties as a part of RehabilitationScheme. The Company will allot the shares to these parties on the finalisation ofRehabilitation Scheme and as per the direction of the BIFR.

Secretarial Audit:

The Company has appointed M/s P. S. Channe & Associated Company SecretariesNagpur to hold the office of the Secretarial Auditors and to conduct the SecretarialAudit Report and the said Report is being attached with this Directors’ Report whichis self explanatory except the following qualifications mentioned in the report:

1. That the Company had not given facility of Ballot Paper to the Shareholders of theCompany.

2. That the Company used old format of proxy

3. That the Composition of Board is proper as per Companies Act 1956.

4. That the Company has transferred the amount of Unpaid Dividend to Investor Educationand Protection Fund on 14/08/2014 after getting notice by RoC. Company did not replied toRoc’s Notice and filed e-form INV 1 and INV-5. We observed that there is differencebetween the amount lying with the unpaid amount and the amount transferred to IEPF.

5. That the Company in few cases has not mentioned Din no. of the Director who signedthe documents on behalf of the Company.

6. That the Company has not appointed Internal Auditor for the year under review.

7. That the Company did not established the Vigil Mechanism

8. That the Company had taken loan from Directors

9. That the Company has not appointed Company Secretary in full time employment and noone is appointed as CFO.

10. That the amount of Rs. 1 Lac (Rupees One Lac Only) towards deposit has not receivedwhile filing representation for appointment as Director.

11. There was opening Balance of Share Application money as on 01st April2014 and Company also received some more share application money against which shares arenot allotted till the end of Financial year i.e. up to 31st March 2015.

12. That the pollution related licenses are not renewed.

13. That the Factory License under Factories Act has not been issued by the concernedauthority.

The management review/explanation to above observations are given below:

1. The Company had opted and provided the facility of E-voting to all the members ofthe Company. In view of cost control and green governance (less paper work) the ballotpaper was not provided to the members.

2. While printing the Annual Report mistakenly old format was printed. But thecontents of the proxy form were as nearly as same with the new format of the proxy form.

3. As per the old Companies Act 1956 there were four independent Directors asrecognised by the Board and same was intimated to Stock Exchange also. But as per the newCompanies Act 2013 Company recognised two Directors as Independent Directors and fileform MGT 14 in respect of these two Directors. The other two Directors are stillIndependent Directors and they are not have any pecuniary interest in the management ofthe Company. The Company has taken steps to recognise remaining two Directors asIndependent Directors and will receive the declaration of their independence andaccordingly necessary form will be filed with RoC. The Company’s management/ Boardhave not taken any such major decision during this tenure that will affect theCompany’s state of affairs.

4. The RoC issued one notice in respect of transfer of Unpaid/unclaimed dividend toInvestor Protection and Education Fund. Accordingly the company has transferred thebalance of unpaid dividend to IEPF. The Unpaid/unclaimed dividend amount was deposited inseparate Bank Account and list of members was given to said Bank. The amount ofunpaid/unclaimed Dividend was transferred as per the list provided by the Bank and theremaining amount was withdrawn. The amount deposited in the said account was more than thedividend payable.

5. DIN of the Directors was not printed inadvertently on some of the documents. Thesedocuments were also not so much important.

6. In respect of appointment of Internal Auditor and not having Vigil Mechanism theCompany’s production activity has been fully stopped from the year 2006-07. There isno sale or purchase activity since then. Only administrative activity is continued atRegistered Office of the Company. The present size of the working is limited only up toadministrative work and necessary staff is maintained by the Company. Hence no InternalAuditor nor Vigil Mechanism was enforced. But the Company is having sufficient capacityand work force to handle the work properly.

7. In respect of point Nos. 6 7 8 9 Management explained that the Company has notappointed Company Secretary in full time employment nor appointed Chief Financial Officerbecause the Company is sick Company as declared by the Hon’ble BIFR and theproduction activity is also stopped since the financial year 2006-07. The scope offinancial transactions is very limited and small in size. The Company has appointed oneperson as Manager to look after the financial transactions of the Company. Also theCompany has made necessary arrangement to look after the secretarial compliance work onregular basis.

8. The Company has taken unsecured loans from Directors for the purpose of meeting theday to day and administrative expenses.

9. The Company’s production has been stopped since financial year 2006-07 andmanufacturing activity or related work is also discontinued. Hence there is no as suchcompliance relating to pollution control.

10. The Company has completed the procedure of renewal of Factory and other relatedlicenses. But the concerned department has not renewed the license stating there is noproduction activity and will be renewed as soon as the production activity will commence.

11. The Company was declared as Sick Industrial Unit by the BIFR in the year 2011 andas per the Draft rehabilitation Scheme submitted to the Hon’ble BIFR the company isreceiving the Share Application money from one or two parties as a part of RehabilitationScheme. The Company will allot the shares to these parties on the finalisation ofRehabilitation Scheme and as per the direction of the BIFR.

Corporate Social Responsibility

The provisions of Corporate Social Responsibility is not applicable to the Company.

Particulars Of Employees:

The Company does not have any employee whose particulars are required to be givenpursuant to the provisions of Section 217 (2A) of the Companies Act 1956 read with theCompanies (Particulars of Employees) Rules 1975.

Conservation Of Energy Technology Absorption And Foreign Exchange Earnings &Outgo:

As required under Section 217(1)(e) of the Companies Act 1956 read with the Companies(Disclosure of Particulars in the Report of the Board of Directors) Rules 1988conservation of energy technology absorption and foreign exchange earnings and outgo arenil as there were no operation during the year under review.

Acknowledgements:

The Board expresses its sincere gratitude to the shareholders bankers Statutory andSecretarial Auditors and their staff Statutory Authorities and clients for theircontinued support. The Board also wholeheartedly acknowledges the dedicated efforts of allthe staff and employees of the Company.

FOR AND ON BEHALF OF
THE BOARD OF DIRECTORS
Sd/-
Place: Nagpur T C KOTHARI
Date: 10th August 2015 CHAIRMAN AND EXECUTIVE DIRECTOR