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Shree Ganesh Forgings Ltd.

BSE: 532643 Sector: Engineering
NSE: SGFL ISIN Code: INE883G01018
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OPEN 1.38
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VOLUME 1
52-Week high 2.71
52-Week low 1.38
P/E
Mkt Cap.(Rs cr) 2
Buy Price 1.38
Buy Qty 1199.00
Sell Price 0.00
Sell Qty 0.00

Shree Ganesh Forgings Ltd. (SGFL) - Director Report

Company director report

To

The Members

Your Directors are pleased to present the Forty Second Annual Report on the businessand operations of the Company and the audited accounts for the year ended on March 312015.

FINANCIAL HIGHLIGHTS:

(Rs. in lakhs)
FY 2014-15 FY 2013-14
Loss for the Year 552.60 49.21
Add: Loss brought forward 7677.05 7627.84
Loss carried forward 8229.65 7677.05

RESERVES:

The Company does not have any Reserves.

BUSINESS REVIEW:

During the period under review the turnover of the Company was Rs. 61.07 Lac incomparison to Rs. 32.56 Lac of previous year.

The company has been mainly servicing customers whose requirements matched thecompany's stock of semi-finished and finished goods entirely or partially. In severalcases semi-finished and finished goods have been re-worked to meet the current customers'requirements.

The production facility of the company is still in partial closure mode due to lack ofavailability of working capital funds and persistent labour problem.

The reworked Corporate Debt Restructuring (CDR) package although sanctioned by the CDRCell in March 2010 and sanctioned individually by all the lender bankers was notimplemented at all though it was expected to be implemented by July 2010. Further thebanks unilaterally decided to exit from the CDR scheme.

Members are aware that the company had filed a reference under section 15(1) of theSick Industrial Companies (Special Provisions) Act 1985 due to erosion of its net worth.As of 31st March 2015 the net worth remains negative in view of the accumulated loss.But the matter has been dismissed on 5th February 2015 by AAIFR and writ petition hasbeen made to honorable Delhi high court against AAIFR. The Matter is pending with theCourt.

Meanwhile our accounts with the banks were designated as Non- Performing Asset (NPA)by the bankers and in May 2011 the bankers initiated recovery action under theSecuritization and Reconstruction of Financial Assets and Enforcement of Security InterestAct 2002. The Company is taking all requisite measures to ensure that the outstandingdues to the bankers is settled and has already given its proposal for one-time settlementwith the bankers. State Bank of India which became our lead bank after the merger ofState Bank of Indore with it in August 2010 also sent us a possession notice in October2011 against which the company has already filed an application with the Debt RecoveryTribunal. The management is making constant endeavors to move on with discussions with thebankers so as to arrive at a mutually acceptable proposal.

The management is also evaluating various options with respect to raising the fundsrequired for settling the banks' dues including selling or leasing the land on which thefactory is situated and shifting the operations to an alternate site. As of date themanagement is seriously considering a couple of proposals although a structured outcomeis yet to emerge.

FUTURE PROSPECTS:

The Company is taking the requisite steps to ensure better product-mix and enhancingcapacity utilization.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS:

The Company's petition for declaring itself as sick Company has been dismissed in 5thFebruary 2015 by AAIFR and writ petition has been made to honorable Delhi High Courtagainst AAIFR. The Matter is pending with the Court.

No other significant and material orderwas passed by the regulators or courts ortribunals which would impact the going concern status and the Company's future operations.

MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY:

State Bank of Patiala had assigned their debts to Invent Asset Securitisation andReconstruction Pvt. Ltd.(ARC Company). And State Bank of Hyderabad has assigned theirdebts to ASREC India Limited(ARC Company). The Company is negotiating with them for OTSSettlement.

DIVIDEND:

The Directors do not recommend any dividend for the financial year 2014-15 in view ofthe accumulated loss.

DEPOSITS:

The Company has not invited and/ or accepted any deposits within the meaning of Section73 of the Companies Act 2013 read with the Companies (Acceptance of Deposits) Rules 2014made thereunder.

SHARE CAPITAL:

Presently the Share Capital of the Company is Rs. 125004740/- divided in to12500474 Equity Shares of Rs. 10/- each.

CORPORATE GOVERNANCE:

Your Company complies with the provisions laid down in Corporate Governance laws. Itbelieves in and practices good corporate governance. The Company maintains transparencyand also enhances corporate accountability. Pursuant to Clause 49 of the Listing Agreementwith the Stock Exchanges the following forms part of this Annual Report:

i. Declaration regarding compliance of Code of Conduct by Board Members and SeniorManagement Personnel;

ii. Management Discussion and Analysis;

iii. Report on the Corporate Governance; and

iv. Auditors' Certificate regarding compliance of conditions of Corporate Governance

CORPORATE SOCIAL RESPONSIBILITY INITIATIVES:

During this period under the review Section 135(1) is not applicable to the Company.Hence your Directors have not constituted the Corporate Social Responsibility (CSR)Committee.

SUBSIDIARY COMPANIES:

The Company has one subsidiary viz.SGFL International BV.

Pursuant to the requirements of 32 of the Listing Agreement the details of Investmentsmade in subsidiary joint venture company have been furnished in Notes forming part of theAccounts.

The statement containing the salient features of the Financial Statement of theCompany's pursuant to Section 129(3) of the Companies Act 2013 read with Rule 5 of theCompanies (Accounts) Rules 2014 has been annexed in the prescribed form AOC-1 (AnnexureI).

The subsidiary was constrained to sell off its investments in view of the fall inglobal demand and due to serious operational problems.The consolidated financialstatements of the Company and its subsidiary forms part of the Annual Report.

PARTICULARS OF LOANS. GUARANTEES OR INVESTMENTS:

Particulars of Loans guarantees or Investments under section 186 are given in theNotes forming part of Financial Statements for the year ended 31st March 2015.

CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO:

The particulars as required under the provisions of Section 134(3)(m) of the CompaniesAct2013 and Rule 8 of the Companies (Accounts) Rules 2014 in respect of conservation ofenergy technology absorption and foreign exchange earnings and outgo as required to bedisclosed under the Act and the Companies (Accounts) Rules 2014 are as under:

(a) Conservation of energy measures taken:

The Board of Directors has taken following steps to conserve the energy:

• Switching off lights A/C and computers whenever not used.

• Power utilization on all computers pantry and cabins.

• Planning to replace lights with low energy consumption units

• Controlled the energy consumption by optimizing the temperature inside theoffice premises is the major contributor for the energy conservation for the stores.

• Optimized lighting consumption by strictly controlling the operating hours asper the usage pattern.

Impact:

The board is constantly taking initiatives and steps to reduce the bills and isoptimist for a favorable output. The Board is planning to use energy saver equipment.

(b) Technology absorption measures:

(i) The efforts made towards Technology Absorption The Company is searching for the advance technology which can be used in the Company's premises.
(ii) the benefits derived like product improvement cost reduction product development or import substitution The benefits will be seen in future.
(iii) in case of imported technology (imported during the last three years reckoned from the beginning of the financial year)-
(a) the details of technology imported -
(b) the year of import; -
(c) whether the technology been fully absorbed -
(d) if not fully absorbed areas where absorption has not taken place and the reasons thereof -
(iv) the expenditure incurred on Research and Development -

A. Foreign Exchange Earnings And Outgo

There were no foreign exchange earnings and outgo during the year under review.

PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES:

The Company does not have any employees drawing remuneration in excess of the limitsspecified in Section 197(12) read with Rule 5 of (Appointment and remuneration ofmanagerial Personnel) Rules 2014.

CONTRACTS AND ARRANGEMENTS WITH RELATED PARTIES:

The details of transactions entered into with related parties are enclosed as AnnexureII to this report pursuant to Section 134 (3) (h) of the Companies Act 2013 and Rule 8 ofthe Companies (Accounts) Rules 2014.

RISK ASSSESSMENT AND MANAGEMENT POLICY:

The Company does not have any Risk Management Policy however the Board takes allnecessary steps to identify and evaluate business risks and opportunities and takecorrective steps.

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY:

The Company has an adequate system of internal controls and procedures commensuratewith the size and the limited nature of its business activities.

DIRECTOR'S RESPONSIBILITY STATEMENT:

To the best of our knowledge and belief and according to the information andexplanations obtained by us your Directors make the following statements in terms ofSection 134(3)(c) of the Companies Act 2013:

a. In the preparation of the annual accounts the applicable accounting standards havebeen followedand there are no material departures from the same;

b. 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.

c. The directors have 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 have 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 system to ensure compliance with the provisions ofall applicable laws and that such system were adequate and operating effectively.

DIRECTORS:

Changes in Board constitution

In accordance with the provisions of the Companies Act 2013 Mr. Deepak BalkrishanSekhri (DIN: 00054725) retire by rotation at the ensuing AGM and being eligible offershimself for reappointment.

The Company has received requisite notice in writing from a member proposing thecandidature of Mr. Gain Prakash Singh for appointment as an Independent Director notliable to retire by rotation.

Mr. Deepak Balkrishan Sekhri and Mr Gyan Prakash Singh are not disqualified from beingappointed as a Director as specified in terms of Section 164 of the Companies Act 2013.

Brief profile of Mr. Deepak Balkrishan Sekhri and Mr. Gyan Prakash Singh who isproposed for appointment as stipulated under Clause 49 of the Listing Agreement isfurnished in the Notice of the ensuing AGM. The Board of Directors of your Companyrecommends their re-appointment at the ensuing AGM.

MEETINGS:

Minimum four pre-scheduled Board meetings are held annually. Additional Board meetingsare convened by giving appropriate notice to address the Company's specific needs. In caseof business exigencies or urgency of matters resolutions are passed by circulation.During the yearFourBoard Meetings and FourAudit Committee Meetings were convened and heldthe details of which are given in the Corporate Governance Report. The intervening gapbetween the Meetings was within the period prescribed under the Companies Act 2013 andListing Agreement.

DECLARATION BY INDEPENDENT DIRECTORS:

The Company has received declaration by all Independent Director(s) that they meet thecriteria of independence as provided in sub-section (6) of Section 149 of the CompaniesAct 2013 and Clause 49 of the Listing Agreement.

BOARD EVALUATION

The Board of Directors has not made the formal annual evaluation of its own performanceand that of its committees and individual directors and not devised any policy.

POLICY ON APPOINTMENT AND REMUNERATION OF DIRECTORS AND KMP AND REMUNERATION POLICY-

TheCompanyhas not approved any policy for appointment and remuneration of directors andKMP The Company has not given any remuneration to any of its executive and non-executivedirectors. The Board will formulate the Policy in due course of time. However the Boardensures take due care while doing selection and appointment of Directors Key ManagerialPersonnel Senior Management Personnel and their remuneration.

NOMINATION AND REMUNERATION COMMITTEE-

During the year no such committee meeting took place.

TERMS OF APPOINTMENT & REMUNERATION CFO &MANAGING DIRECTOR

During the year the company has not paid any remuneration to any of the executive ornon-executive directors.

KEY MANAGERIAL PERSONNEL

The current Board of Directors comprises of Non-Executive and Independent Directors.The Company is in process of appointing other Key Managerial Personnel as per theprovisions of the Companies Act 2013.

VIGIL MECHANISM:

The Company has not set up vigil mechanism/ whistle blower policy. However the Companyis committed to adhere to the highest standards of ethical moral and legal conduct of itsbusiness. Your Company hereby affirms that no Director/ employee have been denied accessto the Chairman of the Audit Committee and that no complaints were received during theyear.

AUDITORS:

Statutory Auditors

At the Annual General Meeting held on 22nd December 2014 M/s.Batliboi& Purohit Chartered Accountants were appointed as statutory auditors of the Companyto hold office till the conclusion of the Annual General Meeting to be held in thefinancial year 2016. In terms of the first proviso to Section 139 of the Companies Act2013 the appointment of the auditors shall be placed for ratification at every AnnualGeneral Meeting. Accordingly the appointment of M/s. Batliboi & Purohit CharteredAccountants as statutory auditors of the Company is placed for ratification by theshareholders. In this regard the Company has received a certificate from the auditors tothe effect that if their ratification is confirmed it would be in accordance with theprovisions of Section 141 of the Companies Act 2013.

STATUTORY AUDITORS’ OBSERVATIONS:

(iv) We have not observed any major weakness in the internal control system during thecourse of our audit but the same needs to be further strengthened.

Comments : The Management will ensure to strengthen the Internal Control System.

(vii) According to the information given to us there were certain dues in respect ofIncome Tax &Cess are outstanding as at March 31st2015 for a period of more than sixmonths from the date they become payable due to financial constraints faced by thecompany.

Comments: Due to financial constraints management is unable to pay the dues.

(vii)As on 31.03.2010 the company had accumulated losses of 357639510/- whichcompletely eroded company's net worth.

Comment: The Company was registered as sick company Under the provisions of SickIndustrial and Companies (special provisions) Act 1985 with the board for Industrial andFinancial Reconstruction (BIFR) on 3rd August 2010. The Management is putting its bestefforts for its revival.

SECRETARIAL AUDITORS:

In terms of the provisions of section 204 of the Companies Act 2013 read with theCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014 the Board hasappointed M/s. Anish Gupta& Associates Company Secretaries Mumbai as SecretarialAuditor for conducting Secretarial Audit of your Company for the financial year 31.3.2015.The report of the Secretarial Auditor is annexed herewith as 'Annexure III'

SECRETARIAL AUDITORS’ OBSERVATIONS& COMMENTS FROM BOARD:

In respect of the qualification and remarks by the Secretarial Auditor the managementwould like to state that the detailed problems faced by the company is described in theBusiness Review at the beginning of the Directors Report. The management is trying itslevel best to comply with the provisions of the related Acts Laws and Statutes. Howeverdue to bad financial position and various problems faced by the it is unable to employeeprofessional staff and working its limited staff. The management ensures that it will takenecessary steps to comply with all the applicable Acts on the Company. Pointwise remark ofthe auditor and management comment is as below:

Under the Companies Act 2013

1. The Company has not complied with Rule 4 of Companies (Appointment and Qualificationof Directors) Rules 2014 with respect to appointment of 2 Independent Director:since theCompany is sick company no one is interested to be an Independent Director.

2. The company has not appointed key managerial personnel except the Managing Directoras required under personnel under section 203 of the Companies Act 2013 read with Rule 8and 8A of the Companies (Appointment and Remuneration of Managerial Personnel) Rules2014: the board will ensure the Compliance under section 203

3. The Company has given loans to directors in violation of section 185 of theCompanies Act 2013:The Company has given loan to Mr. Deepak Sekhri.

4. The Company has not set up vigil mechanism/ whistle blower policy as required underSection 177(10):the Company is committed to adhere to the highest standards of ethicalmoral and legal conduct of its business. The Company hereby affirms that no Director/employee have been denied access to the Chairman of the Audit Committee and that nocomplaints were received during the year.

5. Code of Conduct for independent director and meeting at least one meeting in a yearnot held as per under Schedule IV: The Company has only one Independent Director.

6. There is delay and non-submission in filing the forms and returns during the periodunder review including the filing of balance sheet for the financial year 31.3.2013 and31.3.2014:the Board will ensure its Compliance.

7. The Company has not complied with provisions of section 188 of companies Act 2013for selling goods more than 10% to the Related Concern without obtaining share holdersapproval Finished goods and semi-Finished goods are lying in stock which is not sellablein the local market this was made especially for completion of a special order. Since theorder could not be materialized in the appropriate time. Since sister companies havingsome orders in which those material was required by them to complete their finished goodswe have sold the same to sister concern.

8. The Company has Unpaid/ Unclaimed Dividend and Share Application Money of Rs. 183957and 154786 respectively for more than 7 years and which is required to be transferred toIEPF Account which is yet to be complied with:the Board will ensure its Compliance

9. The Company has not appointed Internal Auditor for the year 2014-15:the Board willensure its Compliance.

Under the Listing Guidelines

1. The company has not complied with Clause 49 of Listing Agreement with respect tooptimum combination of Executive and Non - Executive Directors and with respect toappointment of Independent Director and other requirement: since the Company is sickcompany no one is interested to be an Independent Director

2. The Company has not adopted the audited results for 31.3.2014 within 60 days andquarterly result for June 2014 quarter within 45 days as required under the Clause 41 ofthe Listing Guidelines: due to non-availability of professional staff the Company hasfiled quarterly result 3 days late.

3. The Company has not posted the results shareholding patterns annual report andpolicies and other information as required under the Listing Agreement: the Company is inprocess of updating it Website.

Other Laws

1. The Company has not paid statutory dues such as PF therefore violation ofIndustrial Law : The Company has a financial crunch therefore we are not in position toclear statutory dues.

EXTRACT OF ANNUAL RETURN:

In terms of the provisions of Section 92 (3) of the Act read with the Companies(Management and Administration) Rules 2014 an extract of the Annual Return of yourCompany for the financial year ended 31st March 2015 is given in 'Annexure IV'

OTHER DICLOSURES

• The material changes and commitments affecting the financial position of yourCompany between end of the financial year and the date of this report has been reportedelsewhere in the report.

• Your Company has not issued any shares with differential voting.

• There was no revision in the financial statements.

• Your Company has not issued any sweat equity shares.

• During the year your Company has not received any complaints under the SexualHarassment of Women at Workplace (Prevention Prohibition and Redressal) Act 2013.

DISCLOSURES UNDER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION. PROHIBITION& REDRESSAL) ACT. 2013:

The Company is committed to provide a safe & conducive work environment to itsemployees and the Company took proper measures to protect female staff.

PREVENTION OF INSIDER TRADING:

The Company has ensured the compliance of Prevention of Insider Trading with a view toregulate trading in securities by the Directors and designated employees of the Company.The Company is in process to adopt the Code of Conduct for prevention of Insider Trading.

APPRECIATIONS:

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 co-operation and assistance.

Place: Mumbai
Date: 25.8.2015
By Order of the Board of Directors
For Shree Ganesh Forging Limited
DEEPAK SEKHRI
CHAIRMAN
DIN NO. 00054671

ANNEXURE-1

Form AOC-1

(Pursuant to first proviso to sub-section (3) of section 129 read with rule 5 ofCompanies (Accounts) Rules 2014)

Statement containing salient features of the financial statement ofsubsidiaries/associate companies/joint ventures

Part "A": Subsidiaries

(Information in respect of each subsidiary to be presented with amounts in Euro.)

Sl. No. Particulars Details
1. Name of the subsidiary SGFL International B V
2. Reporting period for the subsidiary concerned if different from the holding company's reporting period 2014- 2015
3. Reporting currency and Exchange rate as on the last date of the relevant Financial year in the case of foreignsubsidiaries Euro
4. Share capital 18000
5. Reserves & surplus- share premium 1029227
Other Reserves -964164
6. Total assets 84113
7. Total Liabilities 7837
8. Investments 0
9. Turnover 0
10. Profit before taxation -6787
11. Provision for taxation 0
12. Profit after taxation 0
13. Proposed Dividend 0
14. % of shareholding 100%

Part "B": Associates and Joint Ventures

Statement pursuant to Section 129 (3) of the Companies Act 2013 related to AssociateCompanies and Joint Ventures. The Company has no other associate or joint venturecompanies.

Place: Mumbai
Date: 25.8.2015 By Order of the Board of Directors
For Shree Ganesh Forging Limited
DEEPAK SEKHRI
CHAIRMAN
DIN NO. 00054671

ANNEXURE-2

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 arm's length transaction under third provisothereto.

SL. No. Particulars Details
a) Name (s) of the related party & nature of relationship Namha Metal Ltd Having Common Director and relative holding more then 2%
b) Nature of contracts/arrangements/transaction Finished Stock
c) Duration of the contracts/arrangements/transaction On 15th March 2015
d) Salient terms of the contracts or arrangements or transaction including the value if any No agreement is executed
e) Justification for entering into such contracts or arrangements or transactions' The materials which lying in stock could not salable in the market
f) Date of approval by the Board 13th February 2015
g) Amount paid as advances if any -
h) Date on which the special resolution was passed in General meeting as required under first proviso to section 188 The Company has not passed Special Resolution

2. Details of contracts or arrangements or transactions at Arm's length basis. TheCompany does not have other Related Party Transaction

Place: Mumbai
Date: 25.8.2015
By Order of the Board of Directors
For Shree Ganesh Forging Limited
DEEPAK SEKHRI
CHAIRMAN
DIN NO. 00054671

ANNEXURE-3

Form No.MR-3

SECRETARIAL AUDIT REPORT FOR THE FINANCIAL YEAR ENDED 31ST March 2015

[Pursuant to section 204(1) of the Companies act 2013 and Rule No.9 of the Companies(Appointment and Remuneration Personnel) Rules 2014]

To

The Members SHREE GANESH FORGINGS LIMITED

We have conducted the secretarial audit of the compliance of applicable statutoryprovisions and the adherence to good corporate practices by Shree Ganesh Forgings Limited(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 Company's books papers minute books forms andreturns filed and other records maintained by the Company and also information provided bythe Company its officers agents and authorized representatives during the conduct ofsecretarial audit We hereby report that in our opinion the company has during the auditperiod covering the financial year ended on 31st March 2015 complied with the statutoryprovisions listed hereunder and also that the Company has proper Board-processes andcompliance-mechanism in place to the extent in the manner and subject to the reportingmade hereinafter:

We have examined the books papers minute books forms and returns filed and otherrecords maintained by Shree Ganesh Forgings Limited for the financial year ended on 31stMarch 2015 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 Regulations and Guidelines to the extent applicable prescribed under theSecurities and Exchange Board of India Act 1992 ('SEBI Act') viz.:

(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;

(c) The Securities and Exchange Board of India (Issue of Capital and DisclosureRequirements) Regulations 2009;

(d) The Securities and Exchange Board of India (Registrars to an Issue and ShareTransfer Agents) Regulations 1993 regarding the Companies Act and dealing with client;

We have also examined compliance with the applicable clauses of the Listing Agreementsentered into by the Company with the Stock Exchanges.

During the period under review the Company has generally complied with the provisionsof the Act Rules Regulations Guidelines etc. mentioned above except as mentioned below:

Under the Companies Act 2013

10. The Company has not complied with Rule 4 of Companies (Appointment andQualification of Directors) Rules 2014 with respect to appointment of 2 IndependentDirector.

11. The company has not appointed key managerial personnel except the ManagingDirector as required under personnel under section 203 of the Companies Act 2013 readwith Rule 8 and 8A of the Companies (Appointment and Remuneration of Managerial Personnel)Rules 2014

12. The Company has given loans to directors in violation of section 185 of theCompanies Act 2013.

13. The Company has not set up vigil mechanism/ whistle blower policy as required underSection 177(10).

14. Code of Conduct for independent director and meeting atleast one meeting in a yearnot held as per under Schedule IV.

15. There is delay and non-submission in filing the forms and returns during the periodunder review including the filing of balance sheet for the financial year 31.3.2013 and31.3.2014.

16. The Company has not complied with provisions of section 188 of companies Act 2013for selling goods more than 10% to the Related Concern without obtaining shareholdersapproval.

17. The Company has Unpaid/ Unclaimed Dividend and Share Application Money of Rs.183957 and 154786 respectively for more than 7 years and which is required to betransferred to IEPF Account which is yet to be complied with.

18. The Company has not appointed Internal Auditor for the year 2014-15.

Under the Listing Guidelines

4. The company has not complied with Clause 49 of Listing Agreement with respect tooptimum combination of Executive and Non

- Executive Directors and with respect to appointment of Independent Director and otherrequirement.

5. The Company has not adopted the audited results for 31.3.2014 within 60 days andquarterly result for June 2014 quarter within 45 days as required under the Clause 41 ofthe Listing Guidelines.

Other Laws

1. The Company has not paid statutory dues such as PF therefore violation ofIndustrial LawDuring the period under review provisions of the following regulations werenot applicable to the Company.

(a) The Securities and Exchange Board of India (Employee Stock Option Scheme andEmployee Stock Purchase Scheme) Guidelines 1999;

(b) The Securities and Exchange Board of India (Issue and Listing of Debt Securities)Regulations. 2008;

(c) The Securities and Exchange Board of India (Delisting of Equity Shares)Regulations 2009: and

(d) The Securities and Exchange Board of India (Buyback of Securities) Regulations1998.

(e) Secretarial Standards issued by The Institute of Company Secretaries of Indiarelated to meetings and minute (since not approved by the Central Government)

We further report that

The Board of Directors of the Company does not have the optimum combination ofExecutive and Non - Executive Directors and with respect to appointment of IndependentDirector as required under the Companies Act 2013 and Clause 49 of the ListingGuidelines. There are no changes in the composition of the Board of Directors during theperiod under review.

Adequate notice is given to all directors to schedule the Board Meetings agenda anddetailed notes on agenda were sent at least seven days in advance.

Majority decision is carried through while the dissenting members' views are capturedand recorded as part of the minutes.

We further report that the systems and processes need to be strengthened 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 no specific event /action having majorbearing on the Company's affair in pursuance to the above referred laws rulesregulations guidelines etc referred to aboveexcept as below:

The Company's petition for declaring itself as sick Company has been dismissed in 5thFebruary 2015 by AAIFR and writ petition has been made to honorable Delhi High Courtagainst AAIFR. The Matter is pending with the Court.

For Anish Gupta & Associates
Company Secretaries
Place: Mumbai Anish Gupta
Date: 25.08.2015 Proprietor
FCS 5733 / CP No. 4092

Annexures to the Board's Report.

ANNEXURE- 1

To

The Members Shree Ganesh Forgings Limited

My report of even date is to be read along with this letter.

1. It is management's responsibility to identify the Laws Rules RegulationsGuidelines and Directions which are applicable to the Company depending upon the industryin which it operates and to comply and maintain those records with same in letter and inspirit. My responsibility is to express an opinion on those records based on our audit.

2. I have followed the audit practices and process 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 process and practices I followed provide areasonable basis for our opinion.

3. I have not verified the correctness and appropriateness of financial records andBooks of Accounts of the Company.

4. Wherever required I have obtained the Management's Representation about thecompliance of Laws Rules Regulations Guidelines and Directions and happening eventsetc.

5. 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 Anish Gupta & Associates
Company Secretaries
Place: Mumbai Anish Gupta
Date: 25.08.2015 Proprietor
FCS 5733 / CP No. 4092