OCL IRON AND STEEL LIMITED
Your Directors are pleased to present the 11th Annual Report on the businessand operations of your Company along with the Audited financial statements for thefinancial year ended 31st March 2016.
|STANDALONE FINANCIAL RESULTS || ||(Rupees in Lacs) |
|Particulars ||Year ended 31st March 2016 ||Year ended 31st March 2015 |
|Revenue from Operations ||35580.44 ||101278.29 |
|Other Income ||1184.01 ||957.96 |
|Total Revenue ||36764.45 ||102236.25 |
|Total Expenses ||35994.69 ||91759.45 |
|Profit before Finance Cost Depreciation and Tax ||769.76 ||10476.80 |
|Finance Cost ||12089.31 ||12180.06 |
|Depreciation ||8391.88 ||5479.48 |
|Profit before exceptional items and tax ||(19711.43) ||(7182.74) |
|Tax Expenses ||(6479.90) ||(2634.67) |
|Exceptional Items ||(1336.77) ||(1071.77) |
|Profit after Taxation ||(14568.30) ||(5619.84) |
|Add balance brought forward from Previous Year ||(4118.19) ||1479.04 |
|Surplus/(Deficit)Available ||(18686.49) ||(4140.80) |
|APPROPRIATION || || |
|Adjustment of MAT ||0.00 ||22.61 |
|Surplus/(Deficit) carried to Balance Sheet ||(18686.49) ||(4118.19) |
During the year under review the Company earned revenue from operations amounting toRs. 35580.44 lacs as compared to Rs. 101278.29 lacs in the previous year. Loss after Taxstood at Rs. (14568.30) lacs as against Loss after Tax of Rs. (5619.84) lacs in theprevious year.
The Board of Directors has not recommended any dividend for the financial year ended31.03.2016.
CONSOLIDATED FINANCIAL STATEMENT
In accordance with Section 129 of the Companies Act 2013 Consolidated FinancialStatements are attached and form part of the Annual Report and the same shall be laidbefore the ensuing Annual General Meeting along with the Financial Statements of theCompany.
STATE OF COMPANYS AFFAIRS
The state of affairs of the Company is presented as part of the Management Discussionand Analysis (MDA) Report forming part of the Annual Report.
Your Company has taken adequate steps to ensure compliance with Clause 49 of theListing Agreement executed with BSE Limited and National Stock Exchange of India Limitedread with Regulation 17 to 27 and schedule V of Securities Exchange Board of India(Listing Obligations and Disclosure Requirements) Regulations 2015. The report onCorporate Governance the Report on Management Discussion and Analysis and the requisiteCertificate from the Auditors of the Company confirming compliance with the conditions ofCorporate Governance are provided in a separate section which forms part of the AnnualReport.
DIRECTORS RESPONSIBILITY STATEMENT
Pursuant to the provisions contained in Section 134(5) of the Companies Act 2013 theDirectors hereby confirm that:
a) in the preparation of the annual accounts for the year ended 31st March2016 the applicable Accounting Standards have been followed and there are no materialdepartures from the same;
b) the Directors have selected such accounting policies and applied them consistentlyand made judgements and estimates that are reasonable and prudent so as to give a true andfair view of the state of affairs of the Company as at 31st March 2016 and ofthe profit/loss of the Company for that period;
c) the Directors have taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of the Companies Act 2013 forsafeguarding the assets of the Company and for preventing and detecting fraud and otherirregularities;
d) the Directors have prepared the Annual Accounts on a going concern basis;
e) the Directors have laid down internal financial controls to be followed by theCompany and that such internal financial controls are adequate and are operatingeffectively; and
f) the Directors have devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems are adequate and operating effectively.
SUBSIDIARIES AND ASSOCIATE
In accordance with proviso to sub-section (3) of Section 129 of the Companies Act 2013a statement containing salient features of the financial statements of the Companyssubsidiaries and associate and the report on their performance and financial position inForm AOC-1 is annexed to the financial statements and forms part of the Annual Reportwhich covers the financial position of subsidiaries and Associate Company. (Annexure-I)
In accordance with third proviso to Section 136(1) of the Companies Act 2013 theAnnual Report of your Company containing therein its audited standalone and theconsolidated financial statements has been placed on the website of the Company. (URL:http://www.oclsteel.in/ investors.php)
DIRECTORS AND KEY MANAGERIAL PERSONNEL
During the period under review Mr. Ajai Kumar Gupta has resigned from the post ofCompany Secretary of Company w.e.f. May 14 2016. The Board appreciates his efforts andcontribution towards the growth of the Company during the tenure of his appointment.
Further Pursuant to Section 203 of the Companies Act 2013 the Board of Directors ofthe Company appointed Ms. Yugami Arora as Company Secretary of the Company w.e.f May 272016.
Mr. Vinod Kumar Uppal (DIN: 00897121) Director of the Company retires by rotation atthe ensuing Annual General Meeting and being eligible offers himself for re-appointment.The Board of Directors recommends his appointment.
A Brief Resume of Mr. Vinod Kumar Uppal as required under Regulation 36(3) ofSecurities Exchange Board of India (Listing Obligations and Disclosure Requirements)Regulations 2015 and Companies Act 2013 forms part of the notice convening AnnualGeneral Meeting.
During the period under review the Company lost its Director Mr. Rajiv Kapur who leftfor his heavenly abode. Mr. Rajiv Kapur made an invaluable contribution to the growth anddevelopment of the Company.
Apart from that There has been no other change in the Directors and Key ManagerialPersonnel of the Company.
Details of the familiarization programme of the Independent Directors are available onthe website of the Company. (URL: http://www.oclsteel.in/investors.php)
INDEPENDENT DIRECTORS DECLARATION
The Company has received the necessary declaration from each Independent Director inaccordance with Section 149 (7) of the Companies Act 2013 that he meets the criteria ofindependence as provided in Section 149(6) of the Companies Act 2013 and as prescribed bythe Securities and Exchange Board of India (Listing Obligations and DisclosureRequirements) Regulations 2015.
The Board met 9 times during the year the details of which are provided in theCorporate Governance Report that forms part of this Annual Report. The intervening gapbetween the meetings was within the period prescribed under the Companies Act 2013 andthe Securities and Exchange Board of India (Listing Obligations and DisclosureRequirements) Regulations 2015.
The Board evaluated the effectiveness of its functioning and that of the committees andof individual Directors by seeking their inputs on various aspects of Board/Committeegovernance such as the Board composition and structure effectiveness of board processesactive participation and contribution of directors in the Board/Committee meetings and thefulfilment of Directors obligation and their fiduciary responsibilities.
Further the Independent Directors at their meeting reviewed the performance of theBoard Chairman of the Board and of Non Executive Directors. The meeting also reviewed theco-ordination between the Company management and the Board which is required for the Boardto effectively and reasonably perform their duties.
INTERNAL FINANCIAL CONTROL SYSTEMS AND THEIR ADEQUACY
The Company has an Internal Control System commensurate with the size scale andcomplexity of its operations. To maintain its objectivity and independence the internalaudit function reports to the Chairman of the Audit Committee and all significant auditobservations and corrective actions are presented to the Committee.
STATUTORY AUDITORS AND AUDITORS REPORT
M/s A.C. Gupta & Associates Chartered Accountants (Firm Regd. No: 008079N) wereappointed as Statutory Auditors of the Company for the period of five years subject to theratification of their appointment at every Annual General Meeting. M/s A.C. Gupta &Associates Chartered Accountants have confirmed their eligibility and willingness toaccept office if their appointment is ratified at the ensuing Annual General Meeting. Theproposal for the ratification of their appointment is included in the notice for AnnualGeneral Meeting sent herewith.
The Company has received a consent letter from the statutory auditors for theirappointment and a certificate from them that their appointment if ratified shall be inaccordance with the conditions as prescribed under the Companies Act 2013 and that theyare not disqualified for appointment.
The Auditors Report does not contain any qualifications reservations or adverseremarks. The Report is attached hereto and is self-explanatory requiring no furtherelucidation.
Pursuant to the provisions of Section 204 of the Companies Act 2013 and the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 the Company hasappointed M/s S. Khurana & Associates Company Secretaries to undertake theSecretarial Audit of the Company. The Report of the Secretarial Audit in Form MR 3 for theFinancial Year ended March 31 2016 is annexed as Annexure II to the Report. There are noqualifications reservations or adverse remarks by Secretarial Auditor in their report.
As per Section 148 of the Companies Act 2013 the Company is required to have theaudit of its cost records conducted by a Cost Accountant in practice. In this connectionthe Board of Directors of the Company has on the recommendation of the Audit Committeeapproved the appointment and remuneration of Mr. Yash Pal Sardana (Membership No. 17996)a Practicing Cost
Accountant as the Cost Auditors of the Company for the year ending 31 March 2017. Theremuneration of the cost auditor is subject to ratification by the members of the Company.
PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS
Disclosure on particulars relating to loans guarantees or investments under section186 of the Companies Act 2013 have been provided as part of the financial statements.
TRANSACTIONS WITH RELATED PARTIES
In accordance with Section 134(3) (h) of the Companies Act 2013 read with Rule 8(2) ofCompanies (Accounts) Rules 2014 the particulars of contracts or arrangements withrelated parties referred to in Section 188(1) of the Companies Act 2013 in theprescribed Form AOC-2 are attached as Annexure III to this Report.
EXTRACT OF ANNUAL RETURN
In terms of Section 134(3)(a) of the Companies Act 2013 read with Rule 12(1) ofCompanies (Management & Administration) Rules 2014 the extract of Annual Return ofthe Company in Form MGT-9 is attached as Annexure IV to this Report.
ENERGY CONSERVATION TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO
The details as required under Section 134(3)(m) of the Companies Act 2013 read withRule 8(3) of Companies (Accounts) Rules 2014 regarding conservation of energytechnology absorption and foreign exchange earnings and outgo are attached as Annexure Vto this Report.
COMMITTEES OF THE BOARD
The Companys Board has the following Committees:
1. Audit Committee
2. Nomination and Remuneration Committee
3. Stakeholders Relationship Committee
4. Corporate Social Responsibility Committee
The details of the membership and attendance at the meetings of the above Committees ofthe board are provided in the Corporate Governance section of the annual report.
POLICY ON APPOINTMENT AND REMUNERATION
Pursuant to Section 178(3) of the Companies Act 2013 the Nomination and RemunerationCommittee of the Board has framed a policy for selection and appointment of Directors andsenior management personnel which inter alia includes the criteria for determiningqualifications positive attributes and independence of a Director(s)/Key managerialpersonnel and their remuneration. Details of the policy on appointment and remunerationare available on the website of the Company (URL: http://www.oclsteel.in/investors.php)
CORPORATE SOCIAL RESPONSIBILITY
A brief outline of the Corporate Social Responsibility Policy of the Company and theinitiatives undertaken by the Company on CSR activities during the year are set out inAnnexure VI of this report as per the format prescribed in the Companies (Corporate SocialResponsibility Policy) Rules 2014. The composition of CSR committee and other relateddetails are provided in the Corporate Governance section forming part of this Report. Thepolicy is available on the website of the Company. (URL:http://www.oclsteel.in/investors.php)
The Audit Committee comprises Mr. Yogesh Kapur Independent Director as Chairman Mr.Sanjay Tiku and Mr. Vinod Kumar Uppal as Members. The Board of Directors have accepted allthe recommendations of the Audit Committee.
The Company has in place a vigil mechanism in the form of Whistle Blower Policy. Itaims at providing avenues for employees to raise complaints and to receive feedback on anyaction taken and seeks to reassure the employees that they will be protected againstvictimization and for any whistle blowing conducted by them in good faith. The policy isintended to encourage and enable the employees of the Company to raise serious concernswithin the organization rather than overlooking a problem or handling it externally.
The Company is committed to the highest possible standard of openness probity andaccountability. It contains safeguards to protect any person who uses the Vigil Mechanismby raising any concern in good faith. The Company protects the identity of the whistleblower if the whistle blower so desires however the whistle blower needs to attend anydisciplinary hearing or proceedings as may be required for investigation of the complaint.The mechanism provides for a detailed complaint and investigation process.
If circumstances so require the employee can make a complaint directly to the Chairmanof the Audit Committee. The Company also provides a platform to its employees for havingdirect access to the Chairman of the Audit Committee in appropriate or exceptional cases.The Company Secretary is the Compliance Officer of the Vigil Mechanism Committee. Theconfidentiality of those reporting violations is maintained and they are not subjected toany discriminatory practice.
The Company has developed and implemented a Risk Management Policy. The details ofelements of risk and mitigation measures are provided in the Management Discussion andAnalysis section of the Annual Report.
ANTI SEXUAL HARASSMENT POLICY
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 and Redressal)Act 2013. An Internal Complaints Committee has been set up to redress complaints receivedregarding sexual harassment. All women employees (permanent contractual temporarytrainees) are covered under this policy. During the year 2015-16 no complaints werereceived by the committee.
PARTICULARS OF EMPLOYEES
The details as required in terms of the provisions of Section 197 read with Rule 5(1)of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 areattached as Annexure VII to this Report.
The particulars of employees as required in terms of the provisions of Section 197 readwith Rule 5 (2) & (3) of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014 is Nil.
During the year under review the Company has not accepted any deposits from publicmembers or employees under the Companies Act 2013 and as such no amount of principal orinterest on public deposits was outstanding as on the date of balance sheet.
SIGNIFICANT AND MATERIAL ORDERS
No significant and material orders have been passed by any regulators or courts ortribunals impacting the going concern status and Companys operations in future.
DEMATERIALISATION AND LISTING
The equity shares of the Company are admitted to the depository system of NationalSecurities Depository Limited (NSDL) and Central Depository Services (India) Limited(CDSL). As on 31st March 2016 130185332 Equity Shares representing 97.05%of the Equity Share Capital of the Company are in dematerialized form. The Equity Sharesof the Company are compulsorily traded in dematerialized form as mandated by theSecurities and Exchange Board of India (SEBI). The International Securities IdentificationNumber (ISIN) allotted to the Company with respect to its Equity Shares is INE 196J01019.
The Equity Shares of the Company are listed on BSE Limited and National Stock Exchangeof India Limited and are actively traded.
MATERIAL CHANGES AND COMMITMENTS
The Company was under financial stress and had difficulty in certain payments to itslenders and in view of the same a Joint Lenders Forum (hereinafter referred as"JLF") was constituted as per the binding guidelines of Reserve Bank of India("RBI") to arrive at the Corrective Action Plan to assist the OCL Iron and SteelLimited to overcome the financial stress. These guidelines dated 26th February 2014 and asamended on 8th July 2015 and 25th February 2016 provide for restructuring andrevitalization refinance of various facilities advances by Lenders.
RECONCILIATION OF SHARE CAPITAL AUDIT
As per the directive of the Securities & Exchange Board of India M/s S. Khurana& Associates Company Secretaries New Delhi undertook the Reconciliation of ShareCapital Audit on a quarterly basis. The purpose of the audit is to reconcile the totalnumber of shares held in National Securities Depository Limited (NSDL) Central DepositoryServices (India) Limited (CDSL) and in physical form with respect to admitted issued andpaid up capital of the Company.
The reconciliation of Share Capital Audit Report as submitted by M/s S. Khurana &Associates Company Secretaries New Delhi on quarterly basis was forwarded to the BSELimited and National Stock Exchange of India Limited where the Equity Shares of theCompany are listed.
During the year under review the relations between the Management and the workmen werehighly cordial. Human resources initiatives such as skill up gradation trainingappropriate reward & recognition systems and productivity improvement were the keyfocus areas for development of the employees of the Company.
Your Company always endeavours to promptly respond to membersrequests/grievances. Each and every issue raised by the members is taken up with utmostpriority and every effort is made to resolve the same at the earliest. The StakeholdersRelationship Committee of the Board periodically reviews the status of the redressal ofinvestors grievances.
Your Directors wish to place on record the sincere and dedicated efforts of all theemployee of the Company. Your Directors also take this opportunity to offer their sincerethanks to the Financial Institutions Banks and other Government Agencies valuedcustomers investors and all the stakeholders for their continued support co-operationand assistance.
| ||BY ORDER OF THE BOARD |
| ||FOR OCL IRON AND STEEL LIMITED |
| ||Sd/- |
|Place : New Delhi ||Yogesh Kapur |
|Dated : 06.08.2016 ||(Chairman) |
| ||DIN: 00014385 |