The Directors have pleasure in presenting the 27th Annual Report of theCompany together with the financial statements for the year ended 2016.
|Financial Results || ||(Rs. in Lakhs) |
|PARTICULARS ||2015-16 ||2014-15 |
|Sales ||168.44 ||173.04 |
|Other Income ||4.56 ||12.41 |
|Total Income ||173.00 ||185.45 |
|Total expenses ||205.86 ||182.35 |
|Profit before Depreciation ||(32.86) ||(3.10) |
|Less: Depreciation ||10.36 ||13.71 |
|Deffered Tax ||3.45 ||4.05 |
|Profit (loss) for the year ||(39.76) ||(6.55) |
|Add : Profit/(Loss) b/f from earlier years ||(171.31) ||(164.77) |
|Profit/( Loss) carried to Balance sheet ||(211.07) ||(171.31) |
Company Performance Dividend
Keeping in view the future expansion plans and capital requirements of the company theBoard of Directors believe it is necessary to conserve cash flow and thereby do notrecommend any dividend for the year.
Fixed Deposits '
Your Company has not accepted any deposits within the meaning of Section 73 of theCompanies Act 2013 and the Companies (Acceptance of Deposits) Rules 2014. IDirectors Responsibility Statement
In terms of Section 134 (5) of the Companies Act 2013 the directors would like tostate that:
i) In the preparation of the annual accounts the applicable accounting standards havebeen followed.
ii) The directors have selected such accounting policies and applied them consistentlyand made judgments and estimates that were 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 or loss of the Company for the year under review.
iii) The directors have 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) The directors have prepared the annual accounts on a going concern basis.
v) The directors had laid down internal financial controls to be followed by thecompany and that such internal financial controls are adequate and were operatingeffectively.
vi) The directors had devised proper system to ensure compliance with the provisions ofall applicable laws and that such system were adequate and operating effectively.
Directors and Key Managerial Personnel
Mrs. Seema Jain will retire by rotation at the ensuing Annual General Meeting andbeing eligible offers herseif for re-appointment in accordance with the provisions of theCompanies Act 2013.Mr SubhashLalwani Executive director submitted his resignation tothe Board on 17th May 2016 due to his personal preoccupations. The same wasaccepted by the Board in its meeting held on 27th May 2016. The Board herebyplaces on record its sincerest thanks and gratitude for the invaluable contribution madeby Mr. Subhash Lalwani towards the growth and development of the company during his tenureas a director.
Policy for selection of Directors and determining Directors Independence
This policy sets out the guiding principles for the Nomination & RemunerationCommittee for identifying persons who are qualified to become Directors and to determinethe independence of Directors in case of their appointment as independent Directors ofthe Company.
Qualifications and criteria
i. The Nomination and Remuneration Committee and the Board shall review on annualbasis appropriate skills knowledge and experience required of the Board as a whole andits individual members. The objective is to have a board - with diverse background andexperience that are relevant for the Companys operations.
ii. In evaluating the suitability of individual Board member the NR Committee may takeinto account factors such as:
General understanding of the companys business dynamics global businessand social perspective;
Educational and professional background
Standing in the profession;
Personal and professional ethics integrity and values;
Willingness to devote sufficient time and energy in carrying out their dutiesand responsibilities effectively.
iii. The Nomination & Remuneration Committee shall evaluate each individual withthe objective of having a group that best enables the success of the companysbusiness.
3. Criteria of Independence
i. The Nomination & Remuneration Committee shall assess the independence ofDirectors at time of appointment/ re-appointment and the Board shall assess the sameannually.The Board shall re-assess determinations of independence when any new interest orrelationships are disclosed by a Director.
ii. The criteria of independence shall be in accordance with guidelines as laid down inCompanies and the Equity Listing Agreement.
iii. The Independent Director shall abide by the Code for Independent Directorsas specified.
4. Other Directorships/ Committee Memberships
i. The Board members are expected to have adequate time and expertise and experience tocontribute to effective Board performance Accordingly members should voluntarily limittheir directorships in other listed public limited companies in such a way that it doesnot interfere with their role as Director of the company.
The NR Committee shall take into account the nature of and the time involved in aDirector service on other Boards in evaluating the suitability of the individual Directorand making its recommendations to the Board.
ii. A Director shall not serve as director in more than 20 companies of which not morethan 10 shall be public limited companies.
iii. A Director shall not serve as an independent Director in more than 7 listedcompanies and not more than 3 listed companies in case he is serving as a whole-timeDirector in any listed company.
iv. A Director shall not be a member in more than 10 committee or act as chairman ofmore than 5 committee across all companies in which he holds directorships.
For the purpose of considering the limit of the committee Audit committee andstakeholders relationship committee of all public limited companies whether listed ror not shall be included and all other companies including private limitedcompanies foreign companies and companies under section 8 of th% Companies Act 2013shall be excluded.
Remuneration policy for Directors key managerial personnel and other employees
This policy sets out the guiding principles for the Nomination and Remunerationcommittee for recommending to the Board the remuneration of the directors key managerialpersonnel and other employees of the company.
i. Remuneration to Executive Director and Key Managerial Personnel
ii. The Board on the recommendation of the Nomination and Remuneration (NR) committeeshall review and approve the remuneration payable to the Executive Director of the companywithin the overall approved by the shareholders.
iii. The Board on the recommendation of the NR committee shall also review and approvethe remuneration payable to the key managerial personnel of the company.
iv. The Remuneration structure to the Executive Director and key managerial personnelshall include the following components:
(i) Basic pay
(ii) Perquisites and Allowances
(iii) Stock Options
(iv) Commission (Applicable in case of Executive Directors)
(v) Retrial benefits
(vi) Annual performance Bonus
v. The Annual plan and Objectives for Executive committee shall be reviewed by the NRcommittee and Annual performance Bonus will be approved by the committee based on theachievement against the Annual plan and Objectives.
2. Remuneration to Non - Executive Directors
i. The Board on the recommendation of the NR Committee shall review and approve theremuneration payable to the Non - Executive Directors of the Company within the overalllimits approved by the shareholders as per provisions of the companies act.
ii. Non-Executive Directors shall be entitled to sitting fees attending the meetings ofthe Board and the Committees thereof. The Non- Executive Directors shall also be entitledto profit related commission in addition to the sitting fees.
3. Remuneration to other employees
Employees shall be assigned grades according to their qualifications and workexperience competencies as well as their roles and responsibilities in the organization.Individual remuneration shall be determined within the appropriate grade and shall bebased on various factors such as job profile skill sets seniority experience andprevailing remuneration levels for equivalent jobs.
Declaration from Independent Directors on Annual Basis
The Company has received a declaration from Mr. Mahendra K Ranka and Mr. MSudheerAnand Independent directors of the company to the effect that they are meeting thecriteria of independence as provided in Sub-section (6) of Section 149 of the CompaniesAct 2013.
Nature of business
There has been no change in the nature of business of the Company.
M/s.Rakesh S Jain & Associates were appointed as Statutory Auditors of our Companyat the Annual General Meeting held on 29"' September 2014 for a term of threeconsecutive years. As per the provisions of Section 139 of the Companies Act 2013 theappointment of Auditors is required to be ratified by Members at every Annual GeneralMeeting.
The auditors report and secretarial auditors' report does not contain anyqualifications reservations or adverse remarks.
Conservation of Energy Technology Absorption Foreign Exchange Earnings and Outgo
Pursuant to provisions of Section 134 of the Companies Act 2013 read with Rule 8(3) ofthe Companies (Accounts) Rules 2014 the details of Conservation of Energy TechnologyAbsorption is attached herewith as Annexure A.
Foreign Exchange Earnings and Outgo: During the period under review there was noforeign exchange earnings or out flow.
Pursuant to provisions of section 204 of the Companies Act 2013 and The Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 the company hasappointed Ajay Kishen Company Secretary in practice to undertake the Secretarial Audit ofthe Company. The Secretarial Audit report is annexed herewith as Annexure B"
Secretarial Audit Report
Certain observations made in the report with regard to non-filing of some forms weremainly due to ambiguity and uncertainty of the applicability of the same for the relevantperiod. However the company would ensure in future that all the provisions are compiledto the fullest extent.
Extract of Annual Return
The extract of Annual Return as on 31st March 2016 in the prescribed FormNo. MGT- 9 pursuant to Section 92(3) of the Companies Act 2013 and Rule 12 (1) of theCompanies (Management and Administration) Rules 2014 is attached herewith asAnnexure - C and forms part of this Report.
Number of Meetings of the Board
During the year ended 31st March 2016 Four Board Meetings were held on29/05/ 2015 14/08/2015 14/11/2015 15/02/2016.
Directors attendance record:
|Name of the Director ||No. Board Meetings held during the year ||No. Board Meetings attended during the year |
|Dr. Ghisulal Jain ||4 ||4 |
|Mahendra Kumar Ranka ||4 ||4 |
|M. SudheerAnand ||4 ||4 |
|Seema Jain ||4 ||4 |
|G Uday Kumar (1) ||4 ||0 |
|SubhashLalwani (2) ||4 ||3 |
(1) G Uday Kumar vacated the office with effect from 14/11/2015.
(2) Subhashtalwani resigned with effect from 17/05/2016.
Particulars of Loans Guarantees or Investments under Section 186 of the Companies Act2013
The Company has not given any loans provided guarantee of made any investments duringthe year 2015-2016
Contracts or arrangements with Related Parties under Section 188(1) of the CompaniesAct 2013
With reference to Section 134(3)(h) of the Companies Act 2013 all contracts andarrangements with related parties under Section 188(1) of the Act entered by the Companyduring the financial year were in the ordinary course of business and on an armslength basis.
During the year the Company had not entered into any contract or arrangement withrelated parties which could be considered material according to the policy ofthe Company on Materiality of Related Party Transactions.
Significant and material orders passed by the regulators or courts or tribunalsimpacting the going concerns status and company's operations in future
The Company has not received any significant or material orders passed by anyRegulatory Authority Court or Tribunal which shall impact the going concern status - andCompany's operations in future.
Subsidiary Companies Associates and Joint Venture Companies
The Company does not have any subsidiary Associate and Joint Venture Company.
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 &to the Chairman & Managing Director.
The Internal Audit Department monitors and evaluates the efficacy and adequacy ofinternal control system in the Company its compliance with operating systems accountingprocedures and policies at all locations of the Company.
Based on the report of internal audit function process owners undertake correctiveaction in their respective areas and thereby strengthen the controls. Significant auditobservations and recommendations along with corrective actions thereon are presented tothe Audit Committee of the Board Industrial Relations
During the year under review your Company enjoyed cordial relationship with workersand employees at all levels.
Business Risk Management
Business Risk Evaluation and Management is an ongoing process within the Organization.The Company has a robust risk management framework to identify monitor and minimize risksas also identify business opportunities.
At present the company has not identified any element of risk which may threaten theexistence of the company.
Material changes and commitments affecting the financial position of the Company whichhave occurred between 31 March 2016 and 13-08-2016 (date of the Report)
There were no material changes and commitments affecting the financial position of theCompany between the end of financial year (31 March 2016) and the date of theReport (13-08-2016).
I. The audit committee of the Company is constituted in line with the provisions ofClause 49 of the Listing Agreements entered into with the stock exchanges read withSection 177 of the Act.
II. The Audit Committee of the Company is entrusted with the responsibility to
supervise the Companys internal controls and financial reporting process andinter alia performs the following functions: -
overseeing the Companys financial reporting process and disclosure offinancial information to ensure that the financial statements are correct sufficient andcredible;
reviewing and examination with management the quarterly financial results beforesubmission to the Board;
reviewing and examination with management the annual financial statements beforesubmission to the Board and the auditors report thereon;
review management discussion and analysis of financial condition and results ofoperations;
scrutiny of inter-corporate loans and investments made by the Company;
reviewing with management the annual financial statements as well as investmentsmade by the unlisted subsidiary companies;
reviewing approving or subsequently modifying any Related Party Transactions inaccordance with the Related Party Transaction Policy of the Company;
approving the appointment of Chief Financial Officer after assessing thequalifications experience and background etc. of the candidate;
recommending the appointment remuneration and terms of appointment of StatutoryAuditors of the Company and approval for payment of any other services;
reviewing and monitoring the auditors independence and performance andeffectiveness of audit process;
reviewing management letters / letters of internal control weaknesses issued bythe Statutory Auditors;
discussing with Statutory Auditors before the audit commences on the natureand scope of audit as well as having post-audit discussion to ascertain area of concernif any;
reviewing with management Statutory Auditors and Internal Auditor the adequacyof internal control systems;
recommending appointment remuneration and terms of appointment of InternalAuditor of the Company;
reviewing the adequacy of internal audit function and discussing with InternalAuditor any significant finding and reviewing the progress of corrective actions on suchissues;
evaluating internal financial controls and risk management systems;
valuating undertaking or assets of the Company wherever it is necessary;
reviewing the functioning of the Whistle Blowing mechanism;
III. The previous annual general meeting (AGM) of the Company was held on 29-9-2015 andwas attended by Mr. Mahendra K Ranka Chairman of the audit committee
IV. The composition of the audit committee and the details of meetings attended by itsmembers are given below:
|Name ||Category ||No. of Meetings held ||No. of Meetings attended |
|Mahendra K Ranka ||Independent Non-Executive ||4 ||4 |
|M SudheerAnand ||Independent Non-Executive ||4 ||4 |
|G Uday Kumar (1) ||Independent Non-Executive ||4 ||0 |
|Seema Jain ||Non - Independent and Non - Executive ||4 ||4 |
(1) G. Uday Kumar vacated the office with effect from 14/11/2015.
V. Four audit committee meetings were held during the year and the gap between twomeetings did not exceed four months. The dates on which the said meetings were held are asfollows: 29-05-2015 4-08-2015 14-11-2015 15-02-2016
Nomination and Remuneration Committee
I. The broad terms of reference of the nomination and Remuneration Committee are asunder:
Recommend to the board the set up and composition of the board and itscommittees including the formulation of the criteria for determiningqualifications positive attributes and independence of a director. Thecommittee will consider periodically reviewing the composition of the board with theobjective of achieving an optimum balance of size skills independence knowledge agegender and experience.
Recommend to the board the appointment or reappointment of directors.
Devise a policy on board diversity.
Recommend to the board appointment of key managerial personnel (KMP"as defined by the Act) and executive team members of the Company (as defined by thiscommittee).
Carry out evaluation of every directors performance and support the boardand independent directors in evaluation of the performance of the board its committeesand individual directors. This shall include formulation of criteria forevaluation of independent directors and the boarcT.
Recommend to the board the remuneration policy for directors executiveteam or key managerial personnel as well as the rest of the employees.
On an annual basis recommend to the board the remuneration payable to thedirectors and oversee the remuneration to executive team or key managerial personnel ofthe Company
Oversee familiarization programs for directors.
Oversee the human resource philosophy human resource and people strategy andhuman resource practices including those for leadership development rewards andrecognition talent management and succession planning (specifically for the board keymanagerial personnel and executive team).
Provide guidelines for remuneration of directors on material subsidiaries.
Recommend to the board on voting pattern for appointment and remuneration ofQi'rectors on the boards of its material subsidiary companies.
Performing such other duties and responsibilities as may be consistent with theprovisions of the committee charter.
II. The composition of the nomination and remuneration committee and the details ofmeetings attended by its members are given below:
|Name ||Category |
|Mahendra K Ranka ||Independent Non Executive |
|M SudheerAnand ||Independent Non-Executive |
|G Uday Kumar (1) ||Independent Non-Executive |
|Seema Jain ||Non - Independent and Non - Executive Women |
(1) G. Uday Kumar vacated the office with effect from 14/11/2015.
During the year no meeting of the nomination and remuneration committee was held.
III. The Company does not have any employee stock option scheme.
IV. Remuneration Policy
The Nomination and Remuneration Committee shall ensure that -
a) The level and composition of remuneration is reasonable and sufficient to attractretain and motivate directors of the quality required to run the company successfully;
b) The relationship of remuneration to performance is clear and meets appropriateperformance benchmarks; and
c) Remuneration to Directors KMPs and Senior Management involves a balance betweenfixed and incentive pay reflecting short and long-term performance objectives appropriateto the working of the company and its goals.
V. Details of Remuneration paid to Directors
The details of remuneration paid to the Executive and Non Executive Directors for thefinancial given below:
SubhashLalwani (Whole time director) has drawn a remuneration of Rs. 72000/- for theyear ended 31.03.2016 and Dr. Ghisulal Jain (Managing Director) has drawn a . remunerationof Rs. 150000/- for the year ended 31.03.2016.
Stakeholders Relationship Committee
i. The Committee is responsible inter alia to specifically look into the redressal ofgrievances of shareholders debenture holders and other security holders includingcomplaints related to transfer of shares non-receipt of balance sheet non-receipt ofdeclared dividends etc.
ii. One meeting of the stakeholders relationship committee was held during theyear on 23rd March 2016.
iii. The composition of the Stakeholders Relationship Committee and the detailsof meetings attended by its members are given below:
|Name ||Category ||No. of Meetings held ||No. of Meetings attended |
|Mahendra Kumar Ranka ||Independent Non-Executive ||1 ||1 |
|SubhashLalwani ||Non - Independent Executive ||1 ||1 |
|M SudheerAnand ||Independent Non-Executive ||1 ||1 |
iv. Name designation and address of Compliance Officer: R. Mani Bhavani - AccountsOfficer Reg: # 4-4-211/212/31st Floor InderbaghSultan Bazar Hyd-95.
v. Details of Complaints/ Requests received resolved and pending during the FinancialYear 2015-16.
|During the Quarter ||Received ||Resolved ||Pending |
|June Qtr ||Nil ||Nil ||Nil |
|Sep. Qtr ||Nil ||Nil ||Nil |
|Dec. Qtr ||Nil ||Nil ||Nil |
|March Qtr ||Nil ||Nil ||Nil |
Vigil Mechanism Policy has been established by the Company for directors and employeesto report genuine concerns pursuant to the provisions of section 177(9) & (10) of theCompanies Act 2013. The same has been placed on the website of the Company.
Formal Annual Evaluation
As per section 149 of the Companies Act 2013 read with clause VII (1) of the scheduleIV and rules made thereunder the independent directors of the company had a meeting on23-3-2016 without attendance of non-independent directors and members of management. Inthe meeting the following issues were taken up:
(a) Review of the performance of non-independent directors and the Board as a whole;
(b) Review of the performance of the Chairperson of the company taking into accountthe views of executive directors and non-executive directors;
(c) Assessing the quality quantity and timeliness of flow of information between thecompany management and the Board that is necessary for the Board to effectively andreasonably perform their duties.
The meeting also reviewed and evaluated the performance of non-independent directors.
The company has 2 (two) non-independent directors namely: Mr. Mahendra Kumar Ranka andMr. M SudheerAnand
The meeting alsoreviewed and evaluated the performance the Board as whole in terms ofthe following aspects:
Preparedness for Board/Committee meetings
Attendance at the Board/Committee meetings
Guidance on corporate strategy risk policy corporate performance andoverseeing acquisitions and disinvestments.
Monitoring the effectiveness of the companys governance practices
Ensuring a transparent board nomination process with the diversity ofexperience knowledge perspective in the Board.
Ensuring the integrity of the companys accounting and financial reportingsystems including the independent audit and that appropriate systems of control are inplace in particular systems for financial and operational control and compliance withthe law and relevant standards.
Corporate Governance and Shareholders Information
Since the paid up capital of the Company is less than Rs. 10 Crores and Net worth ofthe Company is iess than Rs. 25 Crores Corporate Governance is Not Applicable.
Ratio of Remuneration to each Director
Under section 197(12) of the Companies Act 2013 and Rule 5(1 )(2) & (3) of theCompanies(Appointment & Remuneration) Rules 2014 a remuneration of Rs. 72000/ - isbeing paid to Mr. SubhashLalwani whole time director of the Company and a remuneration ofRs. 150000/ - is being paid to Dr. Ghisulal Jain Managing Director of the Company.
Particulars of Employees related disclosures and Human Resources:
The Provisions of Section 197 (12) read with the relevant rules are not applicable tothe Company during the year under review.
The Company continues its focus on retention through employee engagement initiativesand provides a holistic environment where employees get opportunities to realize theirpotential.
The Equity shares of the Company are listed on Bombay Stock Exchange Ltd. (B S E). Thelisting fees for the year 2015-16 has been paid to the Exchange.
Corporate Social Responsibility
The provisions relating to Corporate Social Responsibility are not applicable to ourcompany.
Your Company and its Directors wish to extend their sincerest thanks to the Members ofthe Company Bankers State Government Local Bodies Customers Suppliers ExecutivesStaff and workers at all levels for their continuous cooperation and assistance.
| ||By Order of the Board of Directors |
| ||Sd/- Dr. Ghisulal Jain |
| ||Din: 00404983 |
| ||Chairman and Managing Director |
|Place: Hyderabad Date: 13-8-2016 ||Sd/- Seema Jain Director & CEO DIN No.718351 |