SEL Manufacturing Company Ltd.
Your Directors have pleasure in presenting their 16th Annual Report on the affairs ofthe company together with Audited Financial Statements for the financial year ended 31stMarch 2016.
|FINANCIAL RESULTS || ||(Rupees in Lacs) |
| ||Current Year (2015-16) ||Previous year (2014-15) |
|Revenue from Operations ||194773.45 ||232578.47 |
|Other Income ||11043.52 ||12262.43 |
| ||205816.97 ||244840.90 |
|Less : || || |
|Expenditure ||203105.60 ||228826.98 |
|Provision for Depreciation ||28450.25 ||29327.22 |
| ||231555.85 ||258154.20 |
|Profit/(loss)before exceptional items and tax: ||(25738.88) ||(13313.30) |
|Exceptional Items ||30060.93 ||-- |
|Profit/(Loss) before tax: ||(55799.81) ||(13313.30) |
|Less : || || |
|Taxes : Deferred Tax ||(15604.21) ||(4445.50) |
|Earlier Yrs. ||(0.14) ||197.68 |
| ||(15604.35) ||(4247.82) |
|Profit/(Loss)after Tax ||(40195.46) ||(9065.48) |
|Balance brought forward ||(2381.82) ||6871.50 |
| ||(42577.28) ||(2193.98) |
|Less: Transferred from General Reserve ||23200.00 || |
|Less: Carrying amount of fixed assets debited to retained earnings where rermaining useful life of assets is Nil as on 01.04.2014 ||- ||187.84 |
|Balance Carried over to Balance Sheet ||(19377.28) ||(2381.82) |
The Company is vertically integrated multi-product textile company manufacturingvarious kinds of Knitted Garments Terry Towels Knitted & Processed Fabric andvarious kind of Yarn with production facilities located at Ludhiana and NawanSheher inPunjab Baddi in Himachal Pradesh and Sehore in Madhya Pradesh.
State of Company's affairs:
During the year under review your company has achieved Revenue from Operations of Rs.194773.45 lacs as compared to Rs. 232578.47 lacs in the previous year. After deductingExpenses and Exceptional Items there was Loss of Rs. 55799.81 lacs as compared to Loss ofRs. 13313.30 lacs during the previous year. After providing for taxes and otheradjustments the current year loss stood at Rs. 40195.46 lacs as compared to loss of Rs.9065.48 lacs during the previous year.
As at 31.03.2016 the Company has the following Subsidiary Company(ies) namely SELAviation Pvt. Ltd. SEL Textiles Corporation SEL Textiles Ltd. Silverline CorporationLtd. and also a subsidiary firm namely M/s SE Exports. The Company has its branch officeat United Arab Emirates.
The Annual Accounts of the Subsidiary companies/firms and the related detailedinformation shall be made available to shareholders of the holding and subsidiarycompanies seeking such information at any point of time.
Further the Annual Accounts of the subsidiary companies are kept for inspection by anyshareholders in the head office i.e. the Registered Office of the holding company and ofthe subsidiary companies concerned.
Your company continue to hold 99% stake in the partnership firm namely M/s SE Exports.
SEL Textiles Ltd. is the wholly owned Subsidiary of the Company. SEL Textiles Ltd. isengaged in the business of textiles and the Company has two spinning unit(s) one atNeemrana (Rajasthan) and one at Hansi Hissar (Haryana) and a terry towel unit at NawaSheher Punjab Spinning unit at Vill Punjava-Lambi Tehsil Malout Dist Sri Muktsar Sahib(Punjab). Further SEL Textiles Ltd. has a subsidiary company i.e. M/s SilverlineCorporation Ltd.. SEL Aviation Pvt. Ltd. subsidiary of the company is in the business ofAviation services. SEL Textiles Corporation is the wholly owned subsidiary of the Companyin the state of California USA. The contribution of Subsidiaries in the overallperformance is as given in Consolidated Financial Statements. Further the Report onfinancial position of subsidiaries alongwith names of companies which have ceased to beits subsidiaries associate companies etc. during the year has been duly provided as anAttachment in prescribed Form AOC1.
Consolidated Financial Statements:
The Consolidated Financial Statements of the Company and its subsidiaries prepared andpresented in accordance with Accounting Standard (AS) 21 are attached to and form part ofthe Annual Report.
Your Company is committed to adhere to the best Practices of governance. In yourCompany prime importance is given to reliable financial information integritytransparency fairness empowerment & compliances. A separate section on CorporateGovernance and a Certificate regarding compliance of conditions of Corporate Governanceforms part of the Annual Report
Due to the losses incurred in F.Y. 2015-16 and in order to conserve resources forfuture growth/needs the directors have not recommended any dividend for the Financialyear 2015-16.
SHARES WITH DIFFERENTIAL RIGHTS EMPLOYEE STOCK OPTION SWEAT EUITY SHARES:
During the year the company has not issued any Equity Shares with Differential RightsEmployee Stock Options and/or Sweat Equity Shares.
During the year your Company has not accepted any fixed deposits under the provisionsof the Companies Act 2013 and the Rules made there under.
DIRECTORS & KMP:
Mr. Joginder Kumar Gupta was appointed as a Nominee Director on the Board w.e.f18.03.2016. Further the reappointment of Mr. Vinod Kumar Goyal as Executive Director andMr. Dhiraj Saluja as Jt. Managing Director of the Company for a further period of 3 yearsis put for confirmation by the members of the Company in the ensuing Annual GeneralMeeting. Further Mr. Dhiraj Saluja Director of the
Company retires by rotation at this Annual General Meeting and being eligible offerhimself for re-appointment.
LISTING WITH EXCHANGES AND LISTING FEES:
The Equity Shares of the Company are presently listed with Bombay Stock ExchangeLimited (BSE) and The National Stock Exchange of India Ltd. (NSE). Further the Company haspaid listing fees to both the exchanges (i.e. BSE and NSE) upto financial year 2016-17.The GDRs of the company are listed on Luxembourg Stock Exchange.
M/s Dass Khanna & Co. Chartered Accountants Ludhiana the Statutory Auditors ofthe Company retire at the ensuing Annual General Meeting and are eligible forreappointment.
The report of Auditors and notes on accounts are self explanatory and do not call forany further comments as there are no adverse remarks by the Auditors.
Further regarding Auditors Emphasis of Matter in their Report the Board would like tostate as under;
a) With reference to the Auditors remarks regarding Non confirmation of debit/creditbalances the same were not confirmed by the respective parties despite the letters/mailsin this regard been sent to them. However the management does not expect any materialchanges on account of such reconciliation/non-receipt of confirmation from parties.
b) For no provision in respect of Trade Receivables outstanding for more than 180 daysthe management is of the view that the said receivables are recoverable and as such noprovision is required to be made thereof.
c) The management is of the view that the company is an operative company and will beable to meet its obligations to lenders and as such the financial statements have beenprepared on a going concern basis.
d) Deferred tax Asset and MAT Credit Entitlement have been recognized consideringvirtual certainty that sufficient taxable income will be available during specified periodagainst which such can be adjusted.
e) The recoverable amount of assets within the meaning of "Impairment ofAssets" is more than their carrying value and as such no amount needs to berecognized in the financial statement for impairment losses.
f) The level of inventories is high due to lesser demand and overall recession in theglobal market.
g) The Income Tax Authorities carried out serarch & seizure action u/s 132(1) ofthe Income Tax Act 1961 on the Company. The Consequential Assessment proceedings are inprogress. Pending these proceedings no provision has been made in the boooks foradditional liability (amount presently not ascertainable) for tax interest and penaltyif any.
h) Contingency related to "compensation payable in lieu of bank sacrifice"the outcome of which is materially uncertain and cannot be determined currently.
In terms of the Section 148 of the Companies Act 2013 read with Companies (CostRecords and Audit) Rules 2014 the Company is required to maintain cost accountingrecords and get them audited every year. The Board appointed M/s. Jatin Sharma & Co.Cost Accountants as cost auditors of the Company for the financial year 2016-17 at a feeof INR 77000 plus applicable taxes and out of pocket expenses subject to the ratificationof the said fees by the shareholders at the ensuing annual general meeting. The cost auditreport would be filed with the Central Government within prescribed timelines.
Number of Board Meetings held during the year:
The Board met 6 times during the financial year 2015-16 the details of which are givenin corporate governance section.
Annual Evaluation made by the Board of its own performance and that of its Committeesand Individual Directors
The Board of Directors has evaluated the performance of the Board its Committees andthe Individual Directors as per the Nomination and Remuneration Policy. The Independentdirectors of the Company also review the performace of Non-Independent Directors and theBoard.
Declaration by Independent Directors as required under Section 149(7) of the CompaniesAct 2013
All the Independent directors of the company have given their statement of declarationunder Section 149(7) of the Companies Act 2013 ("the Act") that they meet thecriteria of independence as provided in Section 149(6) of the Act and their Declarationshave been taken on record.
Development and implementation of a Risk Management Policy: The main objective ofRisk Management is risk reduction and avoidance as also identification of the risks facedby the business and optimize the risk management strategies. The Company has put in placea well-defined Risk Management framework for drawing up implementing monitoring andreviewing the Risk Management. It controls the risks through properly defined framework.
POLICY ON DIRECTORS' APPOINTMENT & REMUNERATION
The Company strives to maintainan appropriate combination of executive non-executiveand independent Directors including at least one woman Director. The Nomination &Remuneration Committee of the Company leads the process for Board appointments inaccordance with the requirements of Companies Act 2013 listing agreement and otherapplicable regulations or guidelines. All the Board appointments are based on meritocracy.The potential candidates for appointment to the Board are interalia evaluated on the basisof highest level of personal and professional ethics standing integrity values andcharacter; appreciation of the Company's vision mission values; prominence in businessinstitutions or professions; professional skill knowledge and expertise; financialliteracy and such other competencies and skills as may be considered necessary.
In addition to the above the candidature of an independent Director is also evaluatedin terms of the criteria for determining independence as stipulated under Companies Act2013 listing agreement and other applicable regulations or guidelines. In case ofre-appointment of Independent Directors the Board shall take into consideration theresults of the performance evaluation of the Directors and their engagement level. TheBoard of Directors of the Company has adopted a Remuneration Policy for Directors KMPsand other employees. The policy represents the overarching approach of the Company to theremuneration of Director KMPs and other employees.
LOANS GUARANTEES AND INVESTMENTS BY THE COMPANY
Details of loans guarantees and investments by the Company to other body corporates orpersons are given in Financial Statements/Notes to the financial statements.
MATERIAL AND SIGNIFICANT ORDERS PASSED BY REGULATORS & COURTS
No significant and material orders have been passed by any regulators or courts ortribunals against the Company impacting the going concern status and Company's operationsin future.
MATERIAL CHANGES &COMMITMENTS
No material changes and commitments affecting the financial position of the Companyhave occurred after the end of the financial year 2015-16 and till the date of thisreport.
THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE:
Your Company has always believed in providing a safe and harassment free workplace forevery individual working in SEL through various interventions and practices. The Companyalways endeavors to create and provide an environment that is free from discrimination andharassment including sexual harassment. The Company believes in prevention of harassmentof employees as well as contractors. During the year ended 31 March 2016 no complaintspertaining to sexual harassment were received.
RELEVANT EXTRACT OF THE ANNUAL RETURN
Relevant extract of annual return for the financial year 2015-16 under the CompaniesAct 2013 is given in Annexure V to this report
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 appointed M/s P. Sharma & Co. Company Secretaries in practice toundertake the Secretarial Audit of the Company. The report of the Secretarial Audit isannexed to this report as Annexure VI. Secretarial Auditors' report is self explanatoryand therefore does not require further comments and explanation.
RELATED PARTY TRANSACTIONS
The Board has adopted a policy to regulate the transactions of the Company with itsrelated parties. As per policy all related party transactions require approval as per theprovisions of the companies Act 2013 and listing Agreement entered into with StockExchanges. The said policy is available on the Company's website viz.www.selindia.in/policy.html
Further the Company has also formulated a policy for determining 'material'subsidiaries. The said policy is available on the Company's website viz. www.selindia.in/policy.html. Details of transactions are also given in Annexure IV to thisreport in the prescribed form.
The Company has in place a whistleblower policy to support the Code of BusinessEthics. This policy documents the Company's commitment to maintain an open workenvironment in which employees consultants and contractors are able to report instancesof unethical or undesirable conduct actual or suspected fraud or any violation ofCompany's Code of Business Ethics at a significantly senior level without fear ofintimidation or retaliation.
Individuals can also raise their concerns directly to the chairman of the AuditCommittee of the Company. Any allegations that fall within the scope of the concernsidentified are investigated and dealt with appropriately. Further during the year noindividual was denied access to the Audit Committee for reporting concerns if any. Thedetails of establishment of vigil mechanism for Directors & employees to reportgenuine concerns are available at the website of the Company viz.www.selindia.in/policy.html
INTERNAL FINANCIAL CONTROLS AND ITS ADEQUACY
SEL continuously invests in strengthening its internal control processes. The Companyhas put in place an adequate system of internal financial control commensurate with itssize and nature of business which helps in ensuring the orderly and efficient conduct ofits business. These systems provide a reasonable assurance in respect of providingfinancial and operational information complying with applicable statutes safeguarding ofassets of the Company prevention & detection of frauds accuracy & completenessof accounting records and ensuring compliance with corporate policies.
FAMILIARISATION PROGRAM FOR DIRECTORS
The Company provides an orientation and business overview to all its new Directors andIndependent directors and provides materials and briefing sessions periodically whichassists them in discharging their duties and responsibilities.
The Directors of the Company are also informed of the important developments in theCompany and Industry. Directors are fully briefed on all business related matters and newinitiatives proposed by the Company and updated on changes and developments in thedomestic & global corporate and industry scenario. The details of the familiarisationprogram for Directors is available on the website of the Company viz.www.selindia.in/policy.html
CHANGES IN CAPITAL STRUCTURE
During the year there was no change in the Capital Structure of the Company.
The Board has constituted its Audit Committee pursuant to the provisions of Section 177of the Companies Act 2013 and provisions of the SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015. The Audit Committee of the Company presently comprises ofthe following members namely Mr. Ashwani Kumar Mr. Ranjan Madaan Mr. Amit Narang and Mr.Navneet Gupta. Sh. Ashwani Kumar is the chairman of the said committee.
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO:
Information on conservation of energy technology absorption and foreign exchangeearnings and outgo is given in Annexure I to this report.
PARTICULARS OF EMPLOYEES:
In accordance with the provisions of Section 197(12) of the Companies Act 2013 andRule 5(2) of Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014the names and other particulars of employees are set out in the Annexure-II to this reportand forms part of this report.
DIRECTORS' RESPONSIBILITY STATEMENT:
The Directors would like to assure the Members that the financial statements for theyear under review conform in their entirety to the requirements of the Companies Act2013.
The Directors confirm that
? In the preparation of the annual accounts the applicable accounting standards havebeen followed along with proper explanation relating to material departures;
? Appropriate accounting policies have been selected and applied consistently and havemade judgments and estimates that are reasonable and prudent so as to give a true and fairview of the state of affairs of the Company as at 31st March 2016 and of the profit/lossof the Company for the year ended on 31st March 2016;
? Proper and sufficient care has been taken for maintenance of adequate accountingrecords in accordance with the provisions of the Companies Act 2013 for safeguarding theassets of the Company and for preventing and detecting fraud and other irregularities;
? The annual accounts have been prepared on a going concern basis.
? That Internal financial controls were laid down to be followed by the company andthat such internal financial controls are adequate and were operating effectively.
? Proper systems had been devised to ensure compliance with the provisions of allapplicable laws and that such systems were adequate and operating effectively.
CORPORATE SOCIAL RESPONSIBILITY
The Company has adopted Corporate Social Responsibility initiatives and focuses on keyareas as education healthcare etc. in accordance with the provisons of the relative Actand rules made thereunder.
The Corporate Social Responsibility Committee consists of Sh. Amit Narang (Chairman)Sh. Ram Saran Saluja and Sh. Ranjan Madaan. The Board of Directors on recommendation ofthe CSR Committee has formulated the CSR policy of the Company. The CSR activities of theCompany are implemented in accordance with the core values viz. protecting stakeholderinterests proactive engagement with the local communities and striving towards inclusivedevelopment. The CSR activities are focused on the following five broad themes with goalsto improve overall socioeconomic indicators of Company's area of operation
Promoting healthcare sanitation and making safe drinking water available;
Employment enhancement through training and vocational skill development;
Income enhancement through farm based and other livelihood opportunities;
Promoting education and sports; and
Ensuring sustainable environment.
The annual report on CSR containing particulars specified in Companies (CSR Policy)Rules 2014 is given in Annexure III. The CSR policy of the Company is also placed on thewebsite of the Company viz. www.selindia.in/policy.html
Your Directors express their gratitude to the Company's vendors customers BanksFinancial Institutions Shareholders & society at large for their understanding andsupport. Finally your Directors acknowledge the dedicated services rendered by allemployees of the company.
| ||For and on Behalf of the Board |
|For SEL MANUFACTURING COMPANY LTD. |
|PLACE : LUDHIANA ||(RAM SARAN SALUJA) |
|DATED : 13.08.2016 ||CHAIRMAN |
| ||DIN: 01145051 |
ANNEXURE-I TO THE DIRECTORS' REPORT
A. Conservation of energy
i) Steps taken or Impact on conservation of energy:
The company provides high priority to energy conservation schemes to conserve naturalresources and is regularly taking effective steps to conserve energy wherever possible.This continues to remain thrust area with studies discussions and analysis beingundertaken regularly for further improvements. Energy Conservation is an ongoing processin the Company. The Company continued its efforts to improve energy usage efficiencies.
ii) Steps taken by the company for utilizing alternate sources of energy:
SEL continues to work on reducing carbon footprint in all its areas of operationsthrough initiatives like a) green infrastructure b) green IT (data centers laptops andservers etc. c) operational energy efficiency d) Green data centers. e) Power generationthorough own captive power plants.
iii) Capital Investment on energy conservation equipments etc.:
The company has installed its own Captive Power Plant (CPP turbine). The details of itsutilisation is given as under:
|(a) Captive Power Plant (CPP Turbine) ||2015-16 ||2014-15 |
|Units (Lacs) ||1096.00 ||1190.68 |
|Husk per Unit (Kg) ||0.66 ||0.77 |
|Cost/Unit (Rs.) ||5.78 ||6.65 |
B. RESEARCH & DEVELOPMENT TECHNOLOGY ABSORPTION
Specific areas in which R & D activities/Technology Abrorption were carried out bythe company
New Technology/Product development
Better Quality; reduced wastages
Safer operations and improved competitiveness
Future Plan of Action
Management is committed to strengthen R & D activities for productdevelopment and to improve its competitive ness in the times to come.
Expenditure on R & D
|a) Capital ||- |
|b) Recurring ||15.49 |
|Total ||15.49 |
The Company has not imported any technology from abroad during the last five years.However the company has been using the imported machinery. The Company has been makingefforts for absorption of latest technology.
The Company has achieved improvement in quality and lower cost of production.
C. FOREIGN EXCHANGE EARNINGS & OUTGO EFFORTS AND INITIATIVES IN RELATION TOEXPORTS:
The Company has continued to maintain focus and avail of export opportunities based oneconomic considerations. There have been concentrated efforts to maintain and improveexports performance and to meet the need of end users.
| || ||(Rs. in Lacs) |
| ||2015-16 ||2014-15 |
|(i) Foreign Exchange earned || || |
|(a) FOB value of exports as per Balance Sheet ||103293.07 ||118935.56 |
|(b) Overseas Income ||5257.44 ||16065.44 |
|(ii) Foreign Exchange used || || |
|(a) CIF value of Imports ||652.25 ||775.55 |
|(b) Other Expenditure ||2158.89 ||1044.69 |
|(c) Overseas Expenditures ||5145.84 ||15392.55 |
ANNEXURE-II TO THE DIRECTORS' REPORT
Information pursuant to provisions of section 197(12) of the Companies Act 2013 andRule 5(2) of Companies (Appointment and remuneration of Mangerial Personnel) Rules 2014and forming part of the Directors Report for the year ended 31st March 2016:
|Name ||Age (Yrs.) ||Designation ||Gross Remn. (Rs.) ||Qualification ||Experience (Yrs.) ||Dt. of joining ||Previous Employement ||%age of Eq. Shares held as on 31.03.2016 |
|Mr. Neeraj Saluja ||49 ||Managing Director ||15400000 ||Diploma in business Administration ||24 Yrs ||30.03.2006 ||SEL Mfg. ||9871510 (2.98%) |
|Mr. Dhiraj Saluja ||44 ||Jt. Managing Director ||7200000 ||Degree in Mechanical Engineering ||20 Yrs ||28.05.2007 ||SEL Mfg. Co. Ltd. ||8371506 (2.53%) |
|Mr. Vinod Kumar Goyal ||57 ||Executive Director & CEO ||7800000 ||MBA ||35 Yrs ||13.07.2010 ||Vardhman Texgarments Ltd./ Vardhman Textiles Ltd. ||0.00 |
|Mr.Navneet Gupta ||46 ||Executive Director & CFO ||3600000 ||CA ||21 Yrs. ||08.05.2008 ||SEL Mfg. Co. Ltd. ||600 (0.00) |
|Mr. Manuj Mehta ||47 ||President (HR) ||2995004 ||MBA ||25 Yrs. ||22.11.2010 ||Malwa Industries Ltd. ||0.00 |
|Mr. Jayanta Kumar Das ||52 ||President (Operations) ||2800000 ||B.Tech. in Textile Tech. ||29 Yrs. ||08.04.2013 ||Vallabh Textile Co. Ltd. ||0.00 |
|Mr. Anchal Kumar ||49 ||President (Commercial) ||2411000 ||B.Tech. in Textile Tech. ||27 Yrs. ||30.08.2010 ||Vardhman Textiles Ltd. ||0.00 |
|Mr. Pradeep Kumar Aggarwal ||62 ||President (Engineering) ||2310004 ||B Sc Electrical ||40 Yrs. ||20.06.2011 ||Vardhman Textiles Ltd. ||0.00 |
|Mr. Rajesh Singla ||51 ||President (Raw material) ||2284000 ||MBA ||27 Yrs. ||29.11.2010 ||Vardhman Textiles Ltd. ||0.00 |
|Mr. Raj Kumar Singh ||47 ||Sr. General Manager (HR) ||2052000 ||PG/HRD ||20 Yrs. ||01.03.2012 ||Vardhman Textiles Ltd. ||0.00 |
|Mr. Raman Kumar ||41 ||Sr. General Manager (Marketing) ||2010000 ||Diploma in FD ||19 Yrs. ||04.11.2008 ||Vanasthali Textile Ind.Ltd. ||0.00 |
*Remuneration received includes basic salary allowances taxable value of perquisitesetc..
*The nature of employment i.e. the tenure of Appointment for ManagingDirector/Executive Director is for a period of 3 years.
Other employees are on Roll of the Company.
*Mr. Neeraj Saluja and Mr. Dhiraj Saluja are sons of Mr. Ram Saran Saluja all on theBoard of the Company. None of other Director/employees are related to any director on theBoard of the Company.
Nature of Duties:
Mr. Neeraj Saluja Managing Director is responsible for the overall management of theCompany and provides strategic direction in selection of technology and machineries insetting up new manufacturing facilities improvement of production processes and exploringand diversifying into new ventures etc.
Mr. Dhiraj Saluja Jt. Managing Director of the Company besides being responsible forthe overall management of the Company along with Mr. Neeraj Saluja is also incharge ofoverseeing marketing of yarn garments terry towels etc. and looks after the completefunction of marketing and delivery of our Company's products to the end customer.
Mr. Vinod Kumar Goyal Executive Director & CEO besides being responsible for theoverall management of the Company along with Mr. Neeraj Saluja and Mr. Dhiraj Saluja alsolooks after complete operations of the Company.
Mr. Navneet Gupta Executive Director & CFO is a Chartered Accountant and has avast experience in Financial Areas and other related aspects.
As per the provisions of Section 197 of the Companies Act 2013 read with Companies(Appointment and Remuneration of managerial personnel) Rules 2014 every listed companyis required to disclose following information in the Board report.
(a) ratio of the remuneration of each director to the median remuneration of theemployees of the Company for the financial year;
|NAME ||DESIGNATION ||RATIO TO MEDIAN REMUNERATION OF EMPLOYEES |
|Mr. Ram Saran Saluja ||Director ||0 |
|Mr. Neeraj Saluja ||Managing Director ||132.3 |
|Mr. Dhiraj Saluja ||Jt. Managing Director ||61.8 |
|Mr. Vinod Kumar Goyal ||Executive Director & CEO ||67.0 |
|Mr. Navneet Gupta ||Executive Director & CFO ||30.9 |
|Mr. Ashwani Kumar ||Independent Director ||0.19 |
|Mr. Amit Narang ||Independent Director ||0.82 |
|Mr. Kanwalnain Singh Kang ||Independent Director ||0.17 |
|Mr. Ranjan Madaan ||Independent Director ||0.82 |
|Mr. Prem Kumar ||Independent Director ||0.26 |
|Ms. Paramjit Kaur ||Independent Director ||0.08 |
|Mr. Joginder Kumar Gupta ||Nominee Director ||0 |
*computed based on annualized remuneration.
(b) increase in remuneration of each director Chief Financial Officer Chief ExecutiveOfficer Company Secretary or Manager if any in the financial year; During the financialyear 2015-16 there has not been any increase in the Remuneration to ManagingDirector/whole time Directors of the Company. The company has not paid any profit linkedcommission to non-executive Independent Directors of the Company. Further during the yearthere has also been no increase in remuneration during the year for Chief FinancialOfficer of the Company. The remuneration of Company Secretary has been increased. (c)percentage increase in the median remuneration of employees in the financial year;13.76%
(d) number of permanent employees on the rolls of company;7750
(e) average percentile increase already made in the salaries of employees other thanthe managerial personnel in the last financial year and its comparison with the percentileincrease in the managerial remuneration and justification thereof and point out if thereare any exceptional circumstances for increase in the managerial remuneration
The average increase in the remuneration of employees was 13.76%. During the financialyear 2015-16 there has not been any increase in the Remuneration to ManagingDirector/whole time Directors of the Company. The company has not paid any profit linkedcommission to non-executive independent Directors of the Company. Further during the yearthere has also been no increase in remuneration during the year for Chief FinancialOfficer of the Company. Accordingly there is no comparative information in this regard.
(f) We hereby affirm that the remuneration paid to the managerial and non-managerialpersonnel is as per the Remuneration Policy of the Company
ANNEXURE-III TO THE DIRECTORS' REPORT
ANNUAL REPORT ON CORPORATE SOCIAL RESPONSIBILITY (CSR)
1. A brief outline of the Company's CSR Policy including overview of projectsor programmes proposed to be undertaken and a reference to the web-link to the CSR policyand projects or programmes.
We at SEL are always committed towards sustainability. We do recognise that ourbusiness activities have wide impact on the society in which we operate and therefore aneffective practice is required with due consideration to the interests of ourstakeholders. Our strategy is to create meaningful societal value to enhance thecompetitiveness of value chains that we are part of. It is our conscious strategy todesign and implement Social Investment Programmes in our business context and enrichingvalue for the disadvantaged sections of society through economic empowerment and growth.This entails transcending business interests and quality of life for the upliftment of alland working towards making a better world for all sections of the society.
The Company's Policy including the projects/programs the company intends to undertakeincludes:
? To align and integrate Corporate Social Responsibility programmes with the businessvalue chain of the Company and make them outcome oriented and to support creation ofsustainable livelihood sources.
? To ensure environmental sustainability by adopting best ecological practices andencouraging conservation use of natural resources.
? Establishment of Primary Health Care Centres.
? Girl Child Education: focus on education of girl child and the underpriviliged byproviding appropriate infrasturcture and groom them as future value creators.
? Mother and Child care projects and preventive health through awareness programmes.
? Vocational training: Assist in skill development by providing direction and technicalexpertise to the vulnerable thereby empowering them towards a dignified life and enhancetheir means of livelihood.
? Basic Infrastructure facilities: Creating inclusive and enablinginfrastructure/environment for livable communities.
? Housing facilities: Strive to provide awareness for creating public infrastructurethat is barrier free enabling for all including the elderly and the disabled.
? Safe drinking water/Sanitation & Hygiene: To emphasize on providing basis healthcare facilities and establishing health centers for the elderly and disabled.
? Optimum use of Renewable sources of energy/maintaining quality of air water andsoil.
? Awareness programmes on anti-social issues and Espousing basic moral values/Genderequality empowering women.
? Crisis management: To respond to emergency situations & natural dissters byproviding timely help to affected victims and their families/contribution to such funds asmay be set up by the Central Government for socio-economic development.
? To strive for sustainable development in areas of strategic interest throughinitiatives designed in a manner that addresses the challenges faced by Indiansociety/promote rural development projects.
? To join with other insititutions/society etc. to contribute to the national missionof eardicating hunger and poverty and other social causes.
? To sustain and improve standards of Health Safety and Environment.
2. Composition of CSR Committee
The Corporate Social Responsibility Committee consists of Sh. Amit Narang (Chairman)Sh. Ram Saran Saluja and Sh. Ranjan Madaan
3. Average net profit of the Company for last three financial years
N.A since losses were incurred.
4. Prescribed CSR Expenditure (two percent of the amount as in item 3 above)
5. Details of CSR spent during the financial year : a. Total amount to bespent for the financial year; N.A. b. Amount unspent if any; N.A c. Manner in which theamount spent during the financial year N.A.
6. In case the Company has failed to spend the two per cent of the average netprofit of the last three financial years or any part thereof the company shall providethe reasons for not spending the amount in its Board report.
7. A responsibility statement of the CSR Committee that the implementation andmonitoring of CSR Policy is in compliance with CSR objectives and Policy of the Company.
The implementation and monitoring of CSR Policy is in compliance with CSR objectivesand Policy of the Company.
|Amit Narang ||RAM SARAN SALUJA |
|Chairman-CSR Committee ||DIRECTOR |
|DIN: 05271363 ||DIN: 01145051 |
Manner in which amount spent during the financial year is detailed below: --N.A--
ANNEXURE-IV TO THE DIRECTORS' REPORT
FORM NO. AOC -2
(Pursuant to clause (h) of sub-section (3) of section 134 of the Act and Rule 8(2) ofthe Companies (Accounts) Rules 2014.
Form for Disclosure of particulars of contracts/arrangements entered into by thecompany with related parties referred to in sub section (1) of section 188 of theCompanies Act 2013 including certain arms length transaction under third proviso thereto.
1. Details of contracts or arrangements or transactions not at Arm's lengthbasis.
2. Details of contracts or arrangements or transactions at Arm's length basis.
All related party transactions that were entered into during the financial year were onan arm's length basis and were in compliance with the applicable provisions of the Act andListing Agreement. There were no materially significant related party transactions made bythe Company with promoters Directors key managerial personnel or other designatedpersons which may have a potential conflict with the interest of the Company at large. Thedetails of the transactions with Related Parties are provided in the accompanyingfinancial statements.
RAM SARAN SALUJA
(CHAIRMAN) DIN: 01145051
SECRETARIAL AUDIT REPORT
For The Financial Year Ended 31st March 2016
Pursuant to section 204(1) of the Companies Act 2013 and Rule No. 9 of the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014
SEL Manufacturing Company Limited 274 Dhandari Khurd G.T.Road Ludhiana-141014(PUNJAB)
We have conducted the secretarial audit of the compliance of applicable statutoryprovisions and the adherence to good corporate practices by SEL Manufacturing CompanyLimited (hereinafter called the Company). Secretarial Audit was conducted in a manner thatprovided us a reasonable basis for evaluating the corporate conducts/statutory compliancesand expressing our opinion thereon.
Based on our verification of the SEL Manufacturing Company Limited books papersminute books forms and returns filed and other records maintained by the Company and alsothe information provided by the Company its officers agents and authorizedrepresentatives during the conduct of Secretarial Audit we hereby report that in ouropinion the company has during the audit period covering the financial year ended on31st March 2016 complied with the statutory provisions listed hereunder and also that theCompany has proper Board processes and compliance mechanism in place to the extent in themanner and subject to the reporting made hereinafter:
We have examined the books papers minute books forms and returns filed and otherrecords maintained by SEL Manufacturing Company Limited for the financial year ended on31st March 2016 according to the provisions of:
(i) The Companies Act 2013 (the Act) and the rules made thereunder;
(ii) The Securities Contracts (Regulation) Act 1956 ('SCRA') and the rules madethereunder;
(iii) The Depositories Act 1996 and the Regulations and Bye-laws framed thereunder;
(iv) Foreign Exchange Management Act 1999 and the rules and regulations madethereunder to the extent of Foreign Direct Investment Overseas Direct Investment andExternal Commercial Borrowings;
(v) The following Regulations and Guidelines prescribed under the Securities andExchange Board of India Act 1992 ('SEBI Act') to the extent they were applicable to theCompany:-
(a) The Securities and Exchange Board of India (Substantial Acquisition of Shares andTakeovers) Regulations 2011;
(b) The Securities and Exchange Board of India (Prohibition of Insider Trading)Regulations 1992/ The Securities and Exchange Board of India; (Prohibition of InsiderTrading) Regulations 2015
(c) The Securities and Exchange Board of India (Issue of Capital and DisclosureRequirements) Regulations 2009;
(d) The Securities and Exchange Board of India (Employee Stock Option Scheme andEmployee Stock Purchase Scheme) Guidelines 1999;
(e) The Securities and Exchange Board of India (Issue and Listing of Debt Securities)Regulations 2008;
(f) The Securities and Exchange Board of India (Registrars to an Issue and ShareTransfer Agents) Regulations 1993 regarding the Companies Act and dealing with client:
(g) The Securities and Exchange Board of India (Delisting of Equity Shares)Regulations 2009; and (h) The Securities and Exchange Board of India (Buyback ofSecurities) Regulations 1998; We have also examined compliance with the applicableclauses of the following:
i) Secretarial Standards issued by the Institute of Company Secretaries of India. ii)The Listing Agreements entered into by the Company with BSE Limited and the National StockExchange of India Limited/ SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 During the period under review the Company has complied with theprovisions of the Act Rules Regulations Guidelines standards etc. to the extentapplicable as mentioned above.
We have relied on the representation made by the Company and its Officers for systemsand mechanism formed by the Company for compliances under other applicable Acts Laws andRegulations to the Company and records in pursuant thereo on test-check basis we reportthat the Company has generally complied with the following laws applicable to the Company:
? Factories Act 1948
? Labour Laws
? Acts prescribed under prevention and control of Pollution/Environment Protection.
We further report that the Board of Directors of the Company is duly constituted withproper balance of Executive Directors Non-Executive Directors and Independent Directors.The changes in the composition of the Board of Directors that took place during the periodunder review were carried out in compliance with the provisions of the Act.
Adequate notices were given to all directors to schedule the Board Meetings; agenda anddetailed notes on agenda were sent at least seven days in advance and a system exists forseeking and obtaining further information and clarifications on the agenda items beforethe meeting for meaningful participation at the meeting. Decisions at the board meetingswere taken unanimously.
We further report that there are adequate systems and processes in the companycommensurate with the size and operations of the company to monitor and ensure compliancewith applicable laws rules regulations and guidelines.
We further report that during the audit period the Company has not made any furtherIssue of Capital or redemption/buy-back of Securities Merger Amalgamaton or ForeignTechnical Collaborations etc.
| ||For P. Sharma & Co. |
| ||Company Secretaries |
| ||Pawan Sharma |
|Place: Bhatinda ||ACS No.: 15148 |
|Date: 13.08.2016 ||CP No.: 12316 |
This report is to be read with our letter of even date which is annexd as Annexure Aand forms an integreal part of this report
SEL Manufacturing Company Limited
Our report of even date is to be read along with this letter.
a) Maintenance of Secretarial Record is the responsibility of the management of theCompany. Our responsibility is to express an opinion on these secretarial records based onour audit.
b) We have followed the audit practices and processes as were appropriate to obtainreasonable assurance about the correctness of the contents of the secretarial records. Theverification was done on test basis to ensure that correct facts are reflected insecretarial records. We believe that the processes and practices we followed provide areasonable basis for our opinion.
c) We have not verified the correctness and appropriateness of the financial statementsof the Company.
d) The compliance of the provisions of the Corporate and other applicable laws rulesregulation standards is the responsibility of the management. Our examination was limitedto the verification of procedures on test basis.
e) The Secretarial Audit report is neither an assurance as to the future viability ofthe company nor of the efficacy or effectiveness with which the management has conductedthe affairs of the Company.
| ||For P. Sharma & Co. |
| ||Company Secretaries |
| ||Pawan Sharma |
|Place: Bhatinda ||ACS No.: 15148 |
|Date: 13.08.2016 ||CP No.: 12316 |
Annexure-VII: Remuneration Policy
1. Review of the Policy
1.1 The Nomination and Remuneration Committee will review this policy periodically andrecommend revisions to the board for consideration.
The philosophy for remuneration of Directors Key Managerial Personnel("KMP") and all other employees of SEL Manufacturing Company Limited ("theCompany") is based on the commitment of fostering a culture of leadership with trust.The remuneration policy is aligned to this philosophy.
This remuneration policy has been prepared pursuant to the provisions of Section 178(3)of the Companies Act 2013 ("Act") and Clauses of the Equity Listing Agreement("Listing Agreement")/SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015. In case of any inconsistency between the provisions of law and thisremuneration policy the provisions of the law shall prevail and the company shall abideby the applicable law. While formulating this policy the Nomination and RemunerationCommittee has considered the factors laid down under Section 178(4) of the Act which areas under: (a) the level and composition of remuneration is reasonable and sufficient toattract retain and motivate directors of the quality required to run the companysuccessfully; (b) relationship of remuneration to performance is clear and meetsappropriate performance benchmarks; and (c) remuneration to directors key managerialpersonnel and senior management involves a balance between fixed and incentive payreflecting short and long-term performance objectives appropriate to the working of theCompany and its goals" Key principles governing this remuneration policy are asfollows:
Remuneration for Independent Directors and Non-Independent Non-Executive Directors:
? Independent directors ("ID") and non-independent non-executive directors("NED") may be paid sitting fees (for attending the meetings of the Board and ofcommittees of which they may be members) and commission within regulatory limits.
? Within the parameters prescribed by law the payment of sitting fees and commissionwill be recommended by the Nomination and Remuneration Committee and approved by theBoard.
? Overall remuneration (sitting fees and commission) should be reasonable andsufficient to attract retain and motivate directors aligned to the requirements of theCompany (taking into consideration the challenges faced by the Company and its futuregrowth imperatives).
? Overall remuneration should be reflective of size of the Company complexity of thesector/ industry/ company's operations and the company's capacity to pay the remuneration.
? Overall remuneration practices should be consistent with recognised best practices.
? Quantum of sitting fees may be subject to review on a periodic basis as required.
? The aggregate commission payable to all the Non executive Directors and theIndependent Directors will be recommended by the Nomination and Remuneration Committee tothe Board based on company performance profits return to investors shareholder valuecreation and any other significant qualitative parameters as may be decided by the Board.
? The Nomination and Remuneration Committee will recommend to the Board the quantum ofcommission for each director based upon the outcome of the evaluation process which isdriven by various factors including attendance and time spent in the Board and committeemeetings individual contributions at the meetings and contributions made by directorsother than in meetings.
? In addition to the sitting fees and commission the Company may pay to any directorsuch fair and reasonable expenditure as may have been incurred by the director whileperforming his/her role as a director of the Company. This could include reasonableexpenditure incurred by the director for attending Board/ Board committee meetingsgeneral meetings court convened meetings meetings with shareholders/ creditors/management site visits induction and training (organised by the company for directors)and in obtaining professional advice from independent advisors in the furtherance of his/her duties as a director.
Remuneration for Managing Director ("MD")/ Executive Directors("ED")/ KMP/ rest of the employees
The extent of overall remuneration should be sufficient to attract and retain talentedand qualified individuals suitable for every role. Hence remuneration should be:
? Market competitive (market for every role is defined as companies from which thecompany attracts talent or companies to which the company loses talent).
? Driven by the role played by the individual.
? Reflective of size of the company complexity of the sector/ industry/ company'soperations and the company's capacity to pay.
? Consistent with recognised best practices.
? Aligned to any regulatory requirements.
In terms of remuneration mix or composition:
? The remuneration mix for the MD/ EDs is as approved by the shareholders. In case ofany change the same would require the approval of the shareholders if required underthe provisions of the Companies Act 2013.
? Basic/ fixed salary is provided to all employees to ensure that there is a steadyincome in line with their skills and experience.
? In addition to the basic/ fixed salary the company provides employees with certainperquisites allowances and benefits to enable a certain level of lifestyle and to offerscope for savings and tax optimisation where possible. The company also provides allemployees with a social security net (subject to limits) by covering medical expenses andhospitalisation through re-imbursements or insurance cover and accidental death anddismemberment through personal accident insurance.
? The company provides retirement benefits as applicable.
? In addition to the basic/ fixed salary benefits perquisites and allowances asprovided above the company may provide MD/EDs such remuneration by way of commissioncalculated with reference to the net profits of the company in a particular financialyear as may be determined by the Board subject to the overall ceilings stipulated inSection 197 of the Act. The specific amount payable to the MD/ EDs would be based onperformance as evaluated by the Board or the Nomination and Remuneration Committee andapproved by the Board.
? The company may provide the rest of the employees a performance linked bonus. Theperformance linked bonus would be driven by the outcome of the performance appraisalprocess and the performance of the company.
Remuneration payable to Director for services rendered in other capacity
The remuneration payable to the Directors shall be inclusive of any remunerationpayable for services rendered by such director in any other capacity unless:
a) The services rendered are of a professional nature.
b) The Nomination and Remuneration Committee is of the opinion that the directorpossesses requisite qualification for the practice of the profession.
The Nomination and Remuneration Committee is responsible for recommending theremuneration policy to the Board. The Board is responsible for approving and overseeingimplementation of the remuneration policy.