Shantai Industries Limited (Formerly Known as Wheel And Axle Textiles Limited)
Your directors present Annual report on the business and operations of the companytogether with Audited Statement of Accounts of the company for the year ending 31stMarch 2017.
The particulars pursuant to sub section 3 of section 134 of the Companies Act 2013 aregiven below.
a) The extract of annual return as provided under sub-section (3) of section 92 of theCompanies Act 2013:
The extract of Annual Return is in format MGT-9 for the financial year ended 31/03/2017and is enclosed as "Annexure A" with this report.
b) Number of meetings of the Board:
During the year 2016-17 8 meetings of Board of Directors were held on 05.05.201609.06.2016 25.07.2016 20.10.2016 24.10.2016 28.11.2016 19.12.2016 25.01.2017.
c) Director's Responsibility Statements:
The director's state that:
i) In the preparation of annual accounts for the financial year ended 31stMarch 2017 the applicable accounting standards had been followed along with properexplanation relating to material departures;
ii) The directors had selected such accounting policies and applied them consistentlyand made judgments and estimates that are reasonable and prudent so as to give a true andfair view of the state of affairs of the company as at 31st March and of theprofit / loss of the company for that period;
iii) The directors had taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of the Companies Act 2013 forsafeguarding the assets of the company and for preventing and detecting fraud and otherirregularities;
iv) The director had prepared the annual accounts on a going concern basis;
v) The director had laid down internal financial controls to be followed by the companyand that such internal financial controls are adequate and were operating effectively.
vi) The director had devised proper systems to ensure compliance with the provisions ofall applicable laws and that such systems were adequate and operating effectively.
ca) Details of frauds reported by auditors under sub-section (12) of section 143 otherthan those which are reportable to the central government.
Auditor has not reported any fraud under sub-section (12) of section 143 of TheCompanies Act 2013.
d) A Statement on Declaration given by Independent Directors under sub-section (6) ofsection 149.
The independent directors have submitted declaration pursuant to Section 149(7)confirming that they meet the criteria of independence pursuant to section 149(6). Thestatement has been noted by Board of Directors.
e) If Company covered under sub-section (1) of section 178 company's policy ondirectors' appointment and remuneration including criteria for determining qualificationspositive attributes independence of director and other matter provided under sub-section(3) of section 178.
The Board has on the recommendation of the Nomination and Remuneration Committeeframed a policy for selection and appointment of director and key managerial personal andtheir remuneration. The policy is disclosed at "Annexure B" in pursuance ofprovision to section 178(3) of the companies Act 2013.
The Company does not pay any remuneration to the Non-Execu!ve/Independent Directors ofthe company other than si+ng fees for attending the meeting of the Board/Committee.Remuneration to the Managing Director is governed by the relevant provisions of theCompanies Act 2013.
f) Explanations or comments by the board on every qualification reservation or adverseremark or disclaimer made by the auditor in his report / by the company secretary inpractice in his secretarial audit report.
The statutory auditors have not made any qualifications reservations or adverseremarks or disclaimer in the report and no explanation or comments by the board isrequired.
The Secretarial Audit Report pursuant to Section 204 of the Companies Act 2013 inprescribed Form MR-3 is attached to as "Annexure C" to this report.
g) Particulars of loans guarantees or investments under section 186 of Companies act2013
Company has not during the year under review (a) given any loan to any person or otherbody corporate (b) Given any guarantee or provide security in connection with a loan toany other body corporate or person; and (c) Acquired by way of subscription purchase orotherwise the securities of any other body corporate Exceeding sixty per cent of itspaid-up share capital free reserves and securities premium account or one hundred percent of its free reserves and securities premium account whichever is more and hence theparticulars are not required to be included in this report.
h) Particulars of contracts or arrangements with related parties referred to insub-section (1) of section 188 in the prescribed form (Form AOC-2)
The company has entered into transactions referred to in section 188(1) of TheCompanies Act 2013 with related party and as such particulars in form AOC-2 are attachedto this report.
Material related party Transactions
I. Details of contract or arrangements or transactions not at arm's length basis:
There were no contracts or arrangements or transactions entered into during the yearended 31st March 2017 which were not at arm's length basis
II. Details of material contracts or arrangements or transactions at arm's lengthbasis:
The details of material contracts or arrangements or transactions at arm's length basisfor the year ended 31st March 2017 are as follows.
|Name of the Related Party & Relationship ||Nature of Transaction ||Duration ||Salient Terms ||Amount |
|01 Murlibhai F. Sawlani ||Director's Remuneration || || ||280000 |
|02 Vasudev F. Sawlani ||Director's Remuneration || || ||280000 |
|03 Harish F. Sawlani ||Director's Remuneration ||Ongoing ||On arm's length basis in ordinary course of business ||280000 |
|04 Shweta C. Shah ||Salary as CS || || ||30000 |
|05 Shailesh J Damor ||Salary as CFO || || ||120000 |
i) The state of Company's affairs
There is no Material change in the state of affairs of the company particularly natureof business being carried out.
The income for the year has increased from Rs. 63816340/-in the year 2015-16 to Rs.1080936089.95/- in the year 2016-17. The company earned profit of Rs. 73.75 Lacsagainst Profit of Rs. 5.51 Lacs in previous year.
The Company has not issued any share capital or Debentures during the year. There is nochange in the status of the company or the accoun!ng year.
j) The amount if any which it proposes to carry to any reserves
The Directors do not propose to carry any amount to reserves.
k) The amount if any which it recommends should be paid by way of dividend.
The company has already paid interim dividend during the year under review. TheDirectors do not recommend any amount by way of final dividend.
l) Material Changes and commitments if any Affec"ng the Financial Posi"onof the Company which have occurred between the Ends of the financial year of the companyto which the financial statements relate and the date of the report.
There are no material changes and / or commitments affec!ng financial posi!on of theCompany occurred a$er end of financial year !ll date of this report.
m) The Conserva"on of Energy Technology Absorp"on Foreign Exchange Earningsand Outgo in such manner as may be prescribed.
The company is engaged in trading ac!vity and the manufacturing ac!vity is beingundertaken by way of job work being outsourced from other par!es. There is very limitedscope of conserva!on of energy. Beside in absence of any foreign technology there is noques!on of absorp!on.
Informa!on and details pursuant to Rule 8(3) of the companies (Accounts) Rules 2014with respect to above is given below.
(A) CONSERVATION OF ENERGY-
i) The steps taken or impact on conserva!on of energy: NIL
ii) The steps taken by the company for u!lizing alternate sources of energy: NIL
iii) The capital investment on energy conserva!on equipments: NIL
(B) TECHNOLOGY ABSORPTION-
i) The efforts made towards technology absorp!on: Not Applicable
ii) The benefits derived like product improvement cost reduc!on product developmentor import subs!tu!on: Not Applicable
iii) In case of imported technology (imported during the last three years reckoned fromthe beginning of the financial year)-
a. The details of technology imported : Not Applicable
b. The year of import: Not Applicable
c. Whether the technology been fully absorbed: Not Applicable
d. If not fully absorbed areas where absorp!on has not taken place and the reasonsthereof: Not Applicable and
iv) The expenditure incurred on Research and Development: NIL
(C) FOREIGN EXCHANGE EARNINGS AND OUTGO-
Foreign Exchange earned (actual inflows during the year): Rs. 94.40 Crore ForeignExchange outgo (actual ou*lows): NIL
n) A statement including development and implementa"on of a Risk Management Policyfor the company including iden"fica"on therein of elements of risk if anywhich in the opinion of the board may threaten the existence of the company;
The Directors do not foresee any risk that may threaten the existence of the company innormal course. The Directors proposes to develop and implement specific Risk ManagementPolicy on iden!fica!on of any risk.
o) The details about the policy developed and implemented by the company on corporatesocial responsibility initiatives taken during the year;
Since the net worth of the company is below Five Hundred crores Turnover of thecompany is below one thousand crores Net Profit of the company is below five crores. Theprovision of Sec!on 135 of The Companies Act 2013 is not applicable to the company andhence the company is not required undertake any corporate Social Responsibility (CSR)ini!a!ves.
p) In case of a listed company and every other public company having such paid-up sharecapital as may be prescribed a statement indicating the manner in which formal annualevaluation has been made by the Board of its own performance and that of its committeesand individual directors;
Pursuant to provision of the Companies Act 2013 the board has carried out the annualperformance evalua!on of its own performance as well as the evalua!on of the AuditNomina!on & Remunera!on Commi%ee.
The chairman of Board of directors and the chairman of Nomina!on & remunera!onCommi%ee met all the directors individually to get an overview of the func!oning of theboard and its cons!tuents inter alia on the following board criteria i.e. a%endance andlevel of par!cipa!on independence of judgment exercised by independent directorsinterpersonal rela!onship etc.
Based on the valuable inputs received the directors are encouraged for effec!ve role incompany management.
q) Such other matters as may be prescribed.
(Pursuant to rule 8(5) of The Companies (Accounts) Rules 2014) i) The Financialsummary or highlights
The summary of financial Results (standalone) for the year under review is as:
|Particulars ||As on ||As on |
| ||31/03/2017 ||31/03/2016 |
|Turnover and other income ||1081068856.22 ||64135472.05 |
|Profit/Loss (-) before Financial Charges & deprecia!on ||10973865.13 ||784383.47 |
|Interest and Financial Charges ||102486.32 ||12544.34 |
|Profit/Loss(-) before deprecia!on ||10871378.81 ||796927.81 |
|Deprecia!on ||28698.04 ||0.00 |
|Profit /Loss(-) A$er Tax for the year ||7375188.77 ||550675.81 |
ii) The Change in the nature of business if any:
There is no Material change in nature of business of the company. The director howeverplans to change the object clause of memorandum of Associa!on for diversifying thebusiness in future.
iii) The Details of Directors or key managerial personnel who were appointed or haveresigned during the year:
Ms. Shweta C. Shah was appointed as company secretary cum compliance officer of thecompany with effect from 01/02/2017 apart her there is no change in directors and KeyManagerial Personnel of the company.
iv) The names of companies which have become or ceased to be its Subsidiaries jointventures or associate companies during the year;
No company has become or ceases to be subsidiary joint venture or associate company.
v) The details rela!ng to deposits covered under Chapter V of the Act-
(a) Accepted during the year: NIL
(b) Remained unpaid or unclaimed as at the end of the year: NIL
(c) Whether there has been any default in repayment of deposits or payment of interestthereon during the year and if so number of such cases and the total amount involved-
(i) At the beginning of the year: Not Applicable
(ii) Maximum during the year: Not Applicable
(iii) At the end of the year: Not Applicable
vi) The details of deposits which are not in compliance with the requirements ofChapter V of the Act: NIL
vii) The details of significant and material orders passed by the regulators or courtsor tribunals impac"ng the going concern status and company's opera"ons infuture: NIL
viii) The details in respect of adequacy of internal financial controls with referenceto the Financial Statements.
The company has in place adequate internal financial controls with reference tofinancial statements. Periodic audits are undertaken on con!nuous basis covering all majoropera!on. During the year no Reportable Material weakness in the opera!on was observed.
Disclosures under Companies (Appointment and Remunera"on of Managerial Personnel)Rules 2014.
|Requirement under Rule 5(1) ||Details |
|(i) The ra!o of the remunera!on of each director to the median remunera!on of the employees of the company for the financial year. ||1:1 |
|(ii) The percentage increase in remunera!on of each director chief financial officer Chief Execu!ve officer company secretary or manager in the financial year. ||Directors-366.67% CFO- 100% CS-100% |
|(iii) The percentage increase in the median remunera!on of employees in the financial year ||544.44% |
|(iv) Number of permanent employees on the rolls of the company as on 31st March 2017. ||8 i.e.3 MDS1 CS 1 CFO and 3 employees |
|(v) Average percen!le increase already made in the salaries of the employees other than the managerial personnel in the last financial year and its comparison || ||FY 15-16 ||FY 16-17 |
| ||No. of Months ||6 ||12 |
|with the percen!le increase in the managerial remunera!on and jus!fica!on thereof and point out if there are any excep!onal circumstances for increase in the managerial remunera!on. ||No. of Employees ||1 ||3 |
| ||Average Salary ||8000 ||40000 |
| ||Percen!le increase || ||900% |
| ||Reason for increase ||As company was operated only 6 months in FY 15-16. || |
|(vi) Affiirma!on that the remunera!on is as per the remunera!on policy of the company. ||The company affiirms remunera!on is a per the remunera!on policy of the company. |
No Employee of the company has been paid Remunera!on in excess of limits laid down inrule 5(2) of the companies (Appointment and Remunera!on of Managerial Personnel) Rules2014 and hence statement showing details thereof is not applicable.
An Audit Commi%ee is in existence in accordance with the provisions of Sec!on 177 ofthe Companies Act 2013. The Audit commi%ee comprises of 3 directors namely Shri ViralSuryakant Vora Shri Kirankumar Narharibhai Doshi and Mr.
Harishbhai Fatandas Sawlani. Shri Viral Suryakant Vora is the Chairman of the AuditCommittee. During the year there was no instance where the board had not accepted theRecommendatton of Audit Committee.
Vigil Mechanism/Whistle Blower Policy
Pursuant to section 177(9) of the Companies Act 2013 read with Rule 7 of the Companies(Meetings of Board and its Power) Rules 2014 the Board of Director has adopted vigilmechanism in the form of Whistle Blower Policy through which its Directors Employees andStakeholders can report their genuine concerns about unethical behaviors actual orsuspected fraud or violation of the Company's code of conduct or ethics policy.
It is the Company's Policy to ensure that no employee is victimised or harassed forbringing such incidents to the attention of the Company. The practice of the Whistleblower Policy is overseen by the Audit Committee of the Board and no employee has beendenied access to the Committee. The said policy provides for adequate safeguards againstvictimization and also direct access to the higher levels of supervisors.
Shri Viral Suryakant Vora the Chairman of the Audit Committee can be contacted toreport any suspected / confirmed incident of fraud/misconduct on:
Email: firstname.lastname@example.org Contact no.: 09913425000
Your Company hereby affirms that no Director/Employee has been denied access to theChairman of the Audit Committee and that no complaints were received during the year.
The Board of Directors place on records the services of all stakeholders and associateswho have co-operated in the working of the Company.
By Order of the Board of Directors
For Shantai Industries Limited
(Formerly Known As Wheel And Axle Textiles Limited)
Murlibhai F. Sawlani
Chairman and Managing Director
Date : 05/05/2017