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Parmeshwari Silk Mills Ltd.

BSE: 540467 Sector: Industrials
NSE: N.A. ISIN Code: INE808R01012
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Parmeshwari Silk Mills Ltd. (PARMESHWARISILK) - Director Report

Company director report

Your Directors have pleasure in presenting 22nd Annual Report together with the AuditedAccounts of the Company for the Year ended March 31 2015.

1. SUMMARISED FINANCIAL HIGHLIGHTS

In Lac
PARTICULARS 2014-15 2013-14
Total Income 8157.74 7312.66
Total Expenditure 7435.57 6613.42
Profit/(Loss) before interest Depreciation and Tax 722.17 699.24
Interest and Financial Charges 458.76 350.21
Profit/(Loss) before Depreciation and Tax 263.41 349.03
Depreciation 106.03 114.42
Net Profits/(Loss) before Tax 157.38 234.61
Tax Provision 131.55 48.06
Net Profits/(Loss) 25.83 186.55

DIVIDEND

To conserve the financial resources the Company has not recommended any dividend inthe financial year 2014-15.

RESERVE

The Company has proposed to transfer Rs. 2582201.10 to reserves.

DEPOSITS

During the year under review the Company has not accepted any deposits in terms ofsection 73 of the Companies Act 2013 read with the Companies (Acceptance of Deposit)Rules 2014 and also no amount was outstanding on account of principal or interestthereon as on the date of the Balance Sheet.

SUBSIDIARY COMPANIES:

The Company does not have any subsidiary Company.

MANAGEMENT DISCUSSION & ANALYSIS REPORT

Management Discussion and Analysis Report for the year under review as stipulatedunder Clause 49 of the Listing Agreement with the Stock Exchanges in India is presentedin a separate section forming part of the Annual Report.

STATE OF COMPANY'S AFFAIRS:

Company lays emphasis on being customer-centric and further strives on a well organizedmanagement team of skilled and trained professionals to deliver quality services to itscustomers. Company is involved in manufacturing and supplying of Suiting Fabric ShirtingFabric embroidery Shirting Suiting and Clothing. We design and manufacture all ourproducts using premium raw material and latest technology to assure Perfect quality.

NUMBER OF MEETINGS OF THE BOARD

During the year Sixteen (16) Board Meetings and Four (04) Audit Committee Meetings wereconvened and held. The intervening gap between the Meetings was within the periodprescribed under the Companies Act 2013.

AUDIT COMMITTEE

The composition of the Audit Committee and the details of meetings attended by itsmembers are given below

S.No. Name of the Member Status Category
1. Simranjit Singh Chairman Non Executive Independent Director
2. Prabhpreet Kaur* Chairman Executive Director
2. Jatinder Pal Singh Member Executive Director
3. Rai Sahib Member Non Executive and Independent Director

*Ms. Prabhpreet Kaur ceased to be a Director on the Board w.e.f. 10th February 2015

NOMINATION AND REMUNERATION COMMITTEE

The details of the composition of the Nomination and Remuneration Committee are asunder:

S.No. Name of the Member Status Category
1. Simranjit Singh Chairman Non Executive Independent Director
2. Prabhpreet Kaur* Chairman Executive Director
3. Charanpreet Kaur Rajpal Member Non Executive Independent Director
4. Rai Sahib Member Non Executive and Independent Director

*Ms. Prabhpreet Kaur ceased to be a Director on the Board w.e.f. 10th February 2015

DIRECTORS

During the year Board of Directors had appointed Mr. Jatinder Pal Singh and Ms.Kuljeet Kaur as Whole Time Director at the Board Meeting held on 1st September 2014 andMr. Sukhdev Singh as Chief Financial Officer of the company at the Board Meeting held on13th February 2015.

During the year Mr. Ajinder Pal Singh a Whole Time Director ceased to be member ofthe board w.e.f February 13 2015 due to his Personal occupancy somewhere else and Ms.Prabhpreet Kaur a Whole Time Director ceased to be a member of the board w.e.f. February10 2015. The same was accepted by the Board through Board Resolution in the board meetingheld on February 13 2015 and February 10 2015 respectively. The Board hereby places onrecord its sincerest thanks and gratitude for the invaluable contribution made by Mr.Ajinder Pal Singh and Ms. Prabhpreet Kaur towards the company during his tenure asDirector.

During the Year Board of Directors in its Board Meeting held on December 18 2014 hadappointed Mr. Simranjit Singh (DIN: 07048593) as additional Director W.e.f. December 182014. Apart from this there was no change in the Directors or Key Managerial Personnelduring the year.

Mr. Jatinder Pal Singh Director retires by rotation at the ensuing Annual GeneralMeeting of the Company and being eligible offers himself for re-appointment.

EXTRACT OF ANNUAL RETURN

The details forming part of the extract of the Annual Return in form MGT-9 is annexedherewith as "Annexure A".

STATEMENT ON DECLARATION GIVEN BY INDEPENDENT DIRECTORS UNDER SECTION 149 (6) OFCOMPANIES ACT 2013

Both independent directors have given declarations that they meet the criteria ofindependence as laid down under section 149(6) of the Companies Act 2013 and clause 49 ofthe Listing Agreement.

BOARD EVALUATION

Pursuant to the provisions of companies Act 2013 and clause 49 of the ListingAgreement the Board has carried out annual performance evaluation of its own performancethe directors individually as well the evaluation of the working of its Audit Nomination& Remuneration and Stakeholder committee.

COMPANY'S POLICY ON DIRECTORS' APPOINTMENT AND REMUNERATION

Functions and Terms of Reference of the Nomination and Remuneration Committee of theCompany are as per the Companies Act 2013 and the listing agreement. Further Company'sRemuneration policy is market led and takes into account the competitive circumstance ofthe business so as to attract and retain quality talent and leverage performancesignificantly.

AUDITOR'S REPORT/ SECRETARIAL AUDIT REPORT:

a. STATUTORY AUDITOR:

The Auditors M/s Davinder Pal Singh & Co. Chartered Accountants retire at theconclusion of the ensuing Annual General Meeting and being eligible offer themselves forre-appointment. The Auditors' Report read together with relevant notes thereon are selfexplanatory and hence do not call for any further comments under Section 134 of theCompanies Act 2013.

b. SECRETARIAL AUDITOR:

Pursuant to provisions of section 204 of the Companies Act 2013 and Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 the company hasappointed Mr. P.S. Bathla Company Secretary in Practice to undertake the SecretarialAudit of the Company. The Secretarial Audit report is annexed herewith as "AnnexureB".

c. INTERNAL AUDITOR:

The Company had appointed internal auditor for the period 2014-15 to carry out theInternal Audit functions. The Internal auditor submits a quarterly report to the auditcommittee.

Secretarial Auditors observation and Management comment

Company has appointed P.S.Bathla & Associates as Secretarial Auditor of thecompany they had made an observation that the company has not appointed Company Secretaryin Whole -Time employment as required under Rule-8 of The companies "Appointment andRemuneration of Managerial Personnel " and Company Secretary is included in thedefinition of Key Managerial Personnel under Section 2(51) of the Companies act 2013.

Management has made effort to appoint a Company Secretary in Whole-Time in employmentbut number of Company Secretary are less which are available In the market then thecompanies seeking to appoint Company Secretary(ies) so there is demand and supplymismatch. Further registered office and Secretarial office of the company is situated onthe outskirt of the city Ludhiana which discourages the Company Secretary(ies) to join ourcompany .But company making sincere efforts to appoint a Company Secretary in Whole-Timeemployment and hope to materializes it at the earliest .

PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS UNDER SECTION 186 OF THE COMPANIES ACT2013

The company has not given any loans or guarantees and has not made any investmentscovered under the provisions of section 186 of the Companies Act 2013.

PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES UNDER SECTION 188 OF THECOMPANIES ACT 2013

All related party transactions that were entered into during the financial year were atarm's length basis and were in the ordinary course of the business. There are nomaterially significant related party transactions made by the company with Promoters KeyManagerial Personnel or other designated persons which may have potential conflict withinterest of the company at large.

MATERIAL CHANGES AND COMMITMENTS IF ANY

There are no material changes and commitments noticed by the Board between the end ofthe financial year of the company i.e. 31.03.2015 and the date of the report.

CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION & FOREIGN EXCHANGE EARNINGS ANDOUT-GO:

Sustainability is an integral part of the Company's business philosophy. During theyear under review approximate 5% reduction in consumption of electricity was achieved byefficiently using the Machines.

Further there were no foreign exchange earnings and outgo during the year underreview.

RISK MANAGEMENT:

Pursuant to section 134 (3) (n) of the Companies Act 2013 the Company regularlymaintains a proper check in normal course of its business regarding Risk Management. Atpresent the Company has not identified any element of risk which may threaten theexistence of the company.

CORPORATE SOCIAL RESPONSIBILITY INITIATIVES

As per Section 135 of Companies Act 2013 the Company does not fulfill the criteria ofnet worth or turnover for Corporate Social Responsibility (CSR) hence the same is notapplicable to the Company.

VIGIL MECHANISM / WHISTLE BLOWER POLICY:

The Company has a well established whistle blower policy as part of vigil mechanism forDirectors and employees to report concerns about unethical behavior actual or suspectedfraud or violation of the Company's Code of Conduct or ethics policy. This mechanism alsoprovides for adequate safeguards against victimization of Director(s)/employee(s) whoavail of the mechanism and also provides for direct access to the Chairman of the AuditCommittee.

CORPORATE GOVERNANCE REPORT

As per Clause 49 of the Listing Agreement with the Stock Exchanges a separate sectionon corporate governance practices followed by the Company together with a certificatefrom the Company's Secretarial Auditor confirming compliance forms an integral part ofthis Report.

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

The Company has an Internal Control System commensurate with the size scale andcomplexity of its operations. The scope and authority of the Internal Audit function isdefined in the Internal Audit Manual. To maintain its objectivity and independence theInternal Audit function reports to the Chairman of the Audit Committee of the Board. Themanagement monitors and evaluates the efficacy and adequacy of internal control system inthe Company its compliance with operating systems accounting procedures and policies.Based on the report of internal audit function process owners undertake corrective actionin their respective areas and thereby strengthen the controls.

HUMAN RESOURCES:

The relationship with employees continues to be cordial. The company always considersits human resources as its most valuable asset. Imparting adequate and specializedtraining to its employees is ongoing exercise in the company.

STATEMENT PURSUANT TO LISTING AGREEMENT:

Securities of company were listed at Ludhiyana Stock Exchange and Delhi Stock Exchange.Ludhiya Stock Exchange is given exit by SEBI and Delhi Stock Exchange is suspened by SEBIduring the year. The company's securities are listed with Calcutta Stock Exchange Limitedduring the year. Company has paid listing fee and initial fee for listing for the FY204-15.

CODE OF CONDUCT

The Board of Directors has approved a Code of Conduct which is applicable to theMembers of the Board and all employees in the course of day to day business operations ofthe company. The Company believes in "Zero Tolerance" against briberycorruption and unethical dealings / behaviors of any form and the Board has laid down thedirectives to counter such acts.

The Code lays down the standard procedure of business conduct which is expected to befollowed by the Directors and the designated employees in their business dealings and inparticular on matters relating to integrity in the work place in business practices andin dealing with stakeholders. All the Board Members and the Senior Management personnelhave confirmed compliance with the Code.

PARTICULARS OF EMPLOYEES

The information required pursuant to Section 197 read with Rule 5 of The Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 in respect of employeesof the Company is as follows:

The company has One Executive Director and due to financial constraints being faced bythe company they have forgone their remuneration. Further no sitting fee has been paid toany director during the year.

The particulars of the employees who are covered by the provisions contained in Rule5(2) and rule 5(3) of Companies (Appointment and Remuneration of Managerial Personnel)Rules 2014 are:

a) Employed throughout the year Nil

b) Employed for part of the year Nil

The remuneration paid to all Key management Personnel was in accordance withremuneration policy adopted by the company.

DIRECTOR'S RESPONSIBILITY STATEMENT

In terms of Section 134 (5) of the Companies Act 2013 the directors would like tostate that:

(a) In the preparation of the annual accounts the applicable accounting standards hadbeen followed along with proper explanation relating to material departures;

(b) the directors had 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 at the end of the financial year and ofthe profit and loss of the company for that period;

(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 directors had prepared the annual accounts on a going concern basis;

(e) The directors had laid down internal financial controls to be followed by thecompany and that such internal financial controls are adequate and were operatingeffectively.

(f) The directors had devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems were adequate and operating effectively.

ACKNOWLEDGEMENT

Your Company and its Directors wish to extend their sincerest thanks to the Members ofthe Company Bankers State Government Local Bodies Executives Staff and workers at alllevels for their continuous co-operation and assistance.

By Order of the Board of Directors
For Parmeshwari Silk Mills Limited
Sd/-
Date : 07th August 2015 Jatinder Pal Singh
Place : Ludhiana Chairman