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Sword & Shield Pharma Ltd.

BSE: 531637 Sector: Health care
NSE: N.A. ISIN Code: INE722B01019
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VOLUME 250
52-Week high 11.96
52-Week low 3.30
P/E
Mkt Cap.(Rs cr) 4
Buy Price 0.00
Buy Qty 0.00
Sell Price 7.86
Sell Qty 50.00
OPEN 7.86
CLOSE 7.86
VOLUME 250
52-Week high 11.96
52-Week low 3.30
P/E
Mkt Cap.(Rs cr) 4
Buy Price 0.00
Buy Qty 0.00
Sell Price 7.86
Sell Qty 50.00

Sword & Shield Pharma Ltd. (SWORDSHIELD) - Director Report

Company director report

To The Members

Sword and Shield Pharma Limited.

The Directors have the pleasure of presenting the 21st Annual Report of yourCompany with the Audited Financial Statements of the Company for the year ended March 312016.

KEY FINANCIAL HIGHLIGHTS:

(Amount in Rs.)
Particulars 2015-16 2014-15
Revenue from Operations 381.00 12254601.00
Other Income 3233189.10 398934.00
Total Revenue 3233570.00 12653535.00
Less: Total Expenses 4493964.94 11904785.00
Operating Profits before Exception item Depreciation (1260394.94) 748750.00
Interest and Tax
Less: Depreciation 1352053.00 3619876.00
Interest 65970.94 4471.00
Profit / (Loss) Before Tax (2678418.88) (2875597.00)
Less : Exceptional Items / Prior Period Items (300011.00) (202394.00)
Less: Current Tax 0.00 0.00
Less : Deferred Tax 0.00 714981.00
Profit / (Loss) after Tax from Continuing Operations (2978429.88) (2363010.00)
Profit / (Loss) from discontinuing Operations before Tax 5262783.00 0.00
Tax Expenses of Discontinuing Operations 0.00 0.00
Net Profit / (Loss) After Tax 2284353.00 (2363010.00)

REVIEW OF BUSINESS OPERATION:

The Company has discontinued its operation with respect to the Manufacturing during theyear under review. The Fixed assets of the Company have been sold off by way of Slump Saleand the Company has Nil Fixed Assets as on Date. The Company has incurred the Loss of Rs.29.78 Lakhs during the year 2015-16 against the Loss of Rs. 23.63 Lakhs of Last Year2014-15. Due to the Profit involved in the Sale of Fixed Assets the ultimate Financialsof the Company shows the Net Profit of Rs. 22.84 Lakhs in the year 2015-16.

DIVIDEND:

To conserve resources for future prospect and growth of the Company your Directorsregret to declare Dividend for the Financial Year 2015-16 (Previous year - Nil).

NET PROFIT TRANSFER TO RESERVE:

The Company has transferred the net profit of the Year 2015-16 to General Reserves.

INFORMATION OF BOARD OF DIRECTORS AND ITS MEETINGS: a. Composition and Category ofDirectors on date of this report is:

Name of Directors Categoryof Directorship No.of other Directorship* No.of Committee Membership/ Chairmanship inother Companies No. of Board Meetings attended during 2015-16 Attendance at the AGM held on 30-09-2015
Mr.Pravinbhai Patel DIN: 01877446 Managing Director - - 10 Yes
Jyotsnaben Patel Mrs. DIN : 01877469 Executive Woman Director - - 10 Yes
Mr.Probi Patel# DIN : 01954128 Executive Director - - 9 Yes
Mr.Himanshu Patel# DIN : 02026600 Non-Executive Director - - 7 No
Mr. Jayeshkumar Patel DIN : 00473443 Non-Executive Independent Director 02 - 7 Yes
Mr. Kanjibhai Chaudhary DIN : 00505694 Non-Executive Independent Director 01 - 8 Yes
Mr. Paresh Patel DIN : 02352677 Non-Executive Independent Director 01 - 8 Yes
Mr. Dilipkumar Patel DIN : 00473816 Non-Executive Independent Director 01 - 8 Yes

* Excluding Directorship held in the Company.

# Mr. Probi Patel and Mr. Himanshu Patel resigned from the Board w.e.f. March 15 2016.

The Board of Directors of the Company consists of Six (6) Directors as on March 312016 one (1) of whom is Managing Director one (1) is Executive Director and Four (4) areNon-Executive Independent Directors. Further Mrs. Jyotsnaben P. Patel an ExecutiveDirector of the Company is designated as Woman Director for the Company in terms ofsecond proviso to the Section 149 (1) of the Companies Act 2013.The Composition of Boardfulfils the regulatory requirements.

b. Board Meetings

Regular meetings of the Board are held at least once in a quarter. Additional Boardmeetings are convened to discuss and decide on various business policies strategies andother businesses. During the year under review Board of Directors of the Company met 10times viz May 30 2015 August 4 2015 August 14 2015 September 04 2015 October 12015 November 14 2015 November 18 2015 January 05 2016 February 13 2016 and March16 2016. The gap between two consecutive meetings was not more than one hundred andtwenty days as provided in section 173 of the Act. The Independent Directors of theCompany has met one time on March 16 2016 inter alia to evaluate the performance ofNon-Independent Directors Board as a whole and performance of Chairman of the Company.

INFORMATION OF COMMITTEE AND ITS MEETINGS

Your Company has formed following Committees of the Board in accordance with CompaniesAct 2013: a. Audit Committee

Meetings Composition and Attendance:

The Audit Committee comprises of three Directors and two of them are IndependentDirectors. The Audit Committee met Four times during the financial year 2015-16 on August14 2015 September 04 2015 November 14 2015 and February 13 2016. The composition ofthe Audit Committee as on March 31 2016 and Details of the attendance of the members ofthe committee at the meetings of the Committee are as under:

Name of the Director Category Designation No. of Meetings Attended
Mr. Pareshbhai Patel Independent Director Chairman 4
Mr. Jayeshkumar Patel Independent Director Member 4
Mr. Pravinbhai Patel Managing Director Member 4

The Statutory Auditors of the Company are invited in the meeting of the Committeewherever required. Company Secretary of the Company is acting as a secretary to theCommittee.

b. Stakeholders’ Grievances and Relationship Committee:

Meetings Composition and Attendance:

The Stakeholder’s Grievances & Relationship Committee comprises of threemembers being Independent Directors as on March 31 2016.

During the year under review three meetings were held on August 14 2015 November 142015 and February 13 2016. The composition of the Committee as on March 31 2016 andDetails of the attendance of the members of the committee at the meetings of the Committeeare as under:

Name of the Director Category Designation No. of Meetings Attended
Mr. Jayeshkumar Patel Independent Director Chairman 3
Mr. Dilipkumar Patel Independent Director Member 3
Mr. Kanjibhai Chaudhary Independent Director Member 3

Complaint

During the year the Company had not received any complaints from the Shareholders.There was only one Complaint pending on the SCORES portal as on March 31 2016. The Actiontaken report being Interim reply was send to the Complainant on time.

c. Nomination and Remuneration Committee:

Meetings Composition and Attendance:

The Remuneration Committee comprises of three Non-executive Independent directors as onMarch 31 2016. During the period under review three Nomination and RemunerationCommittee meetings were held respectively on August 14 2015 September 04 2015 andJanuary 05 2016. The composition of the Committee as on March 31 2016 and Details of theattendance of the members of the committee at the meetings of the Committee are as under:

Name of the Director Category Designation No. of Meetings Attended
Mr. Dilipkumar Patel Independent Director Chairman 3
Mr. Jayeshkumar Patel Independent Director Member 3
Mr. Kanjibhai Chaudhary Independent Director Member 3

APPOINTMENT RE-APPOINTMENT AND RESIGNATION OF DIRECTORS:

During the year in terms of Section 149 & 152 of the Companies Act 2013 theBoard of Directors in their Meeting held on August 4 2015 has appointed Mr. DilipkumarPatel Mr. Jayeshkumar Patel Mr. Kanjibhai Chaudhary and Mr. Pareshbhai Patel asNon-Executive Independent Directors of the Company.

Mr. Probi Patel and Mr. Himanshu Patel Directors of the Company had resigned from theBoard of the Company w.e.f. March 15 2016. The Board places on record their appreciationsfor their efforts in the success of the Company.

None of the Directors of the Company is disqualified for being appointed as Director asspecified in Section 164 (2) of the Companies Act 2013.

DECLARATION BY INDEPENDENT DIRECTORS:

The Company has received necessary declaration from each Independent Director underSection 149(7) of the Companies Act 2013 to the effect that they meet the criteria ofindependence laid down in Section 149(6) of the Companies Act 2013. The Terms andConditions for Appointment of Independent Directors and Code for Appointment ofIndependent Directors are incorporated on the website of the Company atwww.swordnshieldpharma.com.

DETAILS OF KEY MANAGERIAL PERSONNEL:

Mr. Pravinbhai Patel Managing Director is the Key Managerial Personnel("KMP") as per the provisions of the Companies Act 2013. He has been appointedas such by the members of the Company w.e.f. May 30 2016.

Further Ms. Prachi S. Shah is acting as a Company Secretary of the Company.

NOMINATION AND REMUNERATION POLICY:

In terms of the provisions of the Companies Act 2013 the Company has devised a policyon Nomination and Remuneration of Directors Key Managerial Personnel and SeniorManagement and the said policy has been incorporated on the website of the Company i.e.www.swordnshieldpharma.com.

Policy on Appointment of Directors Key Managerial Personnel and Senior ManagementPersonnel:

The policy is formulated to identify and ascertain the integrity qualificationexpertise and experience of the person for appointment as Director KMP and SeniorManagement personnel and recommend to the Board for his / her appointment.

Policy on remuneration of Director KMP and Senior Management Personnel:

The Company follows mixed of fixed pay benefits and performance based variable pay.The Company pays remuneration by way of salary. The remuneration paid by the Company iswithin the salary scale approved by the Board and Shareholders.

BOARD EVALUATION:

The board of directors has carried out an annual evaluation of its own performanceboard committees and individual directors pursuant to the provisions of the Act.

The performance of the board was evaluated by the board after seeking inputs from allthe directors on the basis of the criteria such as the board composition and structureeffectiveness of board processes information and functioning etc. The performance of thecommittees was evaluated by the board after seeking inputs from the committee members onthe basis of the criteria such as the composition of committees effectiveness ofcommittee meetings etc. The board and the nomination and remuneration committee reviewedthe performance of the individual directors on the basis of the criteria such as thecontribution of the individual director to the board and committee meetings likepreparedness on the issues to be discussed meaningful and constructive contribution andinputs in meetings etc. In addition the chairman was also evaluated on the key aspectsof his role. Separate meeting of independent directors was held to evaluate theperformance of non-independent directors performance of the board as a whole andperformance of the chairman taking into account the views of executive directors andnon-executive directors. The same was discussed in the board meeting that followed themeeting of the independent directors at which the performance of the board itscommittees and individual directors was also discussed. Performance evaluation ofindependent directors was done by the entire board excluding the independent directorbeing evaluated. The Board of Directors expressed their satisfaction with the evaluationprocess.

PUBLIC DEPOSIT:

The company has not accepted any deposits from the public. Hence the directives issuedby the Reserve Bank of India & the Provision of Section 73 to 76 of the Company Act2013 or any other relevant provisions of the Act and the Rules there under are notapplicable.

PARTICULARS OF LOANS GUARANTEES INVESTMENTS & SECURITY:

Details of Loans Guarantees Investments and Security covered under the provisions ofSection 186 of the Companies Act 2013 are given in the notes to the Financial Statement.The Company has not granted any Loan provided Guarantee or Securities during the yearunder review.

CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES:

All transactions to be entered by the Company with related parties will be in theordinary course of business and on an arm’s length basis. However the Company hasnot entered into any related party transaction as provided in Section 188 of theCompanies Act 2013 with the related party. Hence Disclosure as required under Section188 of the Companies Act 2013 is not applicable to the Company.

EXTRACT OF ANNUAL RETURN:

Pursuant to sub-section 3(a) of Section 134 and sub-section (3) of Section 92 of theCompanies Act 2013 read with Rule 12 of Companies (Management and Administration) Rules2014 the extract of the Annual Return as at March 31 2016 in Form MGT-9 forms part ofthis Annual Report as "Annexure - A."

PARTICULARS OF EMPLOYEES:

The details as required under section 197(12) of the Companies Act 2013 read withRule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) 2014 isnot applicable as there is no such employee in the Company employed throughout thefinancial year with salary above Rs. 102 Lakhs p.a. or employed part of the financial yearwith average salary above Rs. 8.5 Lakhs per month.

Further there is no employee employed throughout Financial year or part thereof wasin receipt of remuneration of in aggregate is in excess of that drawn by the ManagingDirector or Whole time Director or Manager and holds by himself or along with his spouseand dependent children not less than Two percent (2%) of the Equity Shares of theCompany.

ENERGY CONSERVATION TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO:

The details of conservation of energy technology absorption etc. as required to begiven under section 134(3)(m) of the Companies Act 2013 read with the Companies (Accounts)Rules 2014 is not given as the Company has not taken any major step to conserve theenergy etc. Further there was no foreign exchange earnings and outgo during the financialyear 2015-16. (Previous Year Nil).

MATERIAL CHANGES AND COMMITMENT AFFECTING FINANCIAL POSITION OF THE COMPANY:

There are no material changes and commitments affecting the financial position of theCompany which has occurred between the end of financial year of the Company i.e. March 312016 and the date of Director’s Report i.e. September 2 2016.

SEXUAL HARASSMENT OF WOMEN AT WORKPLACE:

There were no incidences of sexual harassment reported during the year under review interms of the provisions of the Sexual Harassment of Women at Workplace (PreventionProhibition and Redressal) Act 2013 and there are only 2 Women employees (Both areholding the position in the Top Management Level) and therefore there was no need toconstitute an Internal Complaints Committee (ICC).

CORPORATE GOVERNANCE:

Pursuant to Regulation 15(2) of SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 the Company is not required to mandatorily comply with the provisions ofcertain regulations of the SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 and therefore the Company has not provided a separate report onCorporate Governance although few of the information are provided in this report ofDirectors under relevant heading.

MANAGEMENT DISCUSSION AND ANALYSIS:

Management Discussion and Analysis for the year under review as stipulated underRegulations 27(2) of the SEBI (LODR) 2015 is presented in a separate section formingpart of this Annual Report.

AUDITORS:

Statutory Auditor & their report

M/s. B. K. Patel & Co. Chartered Accountants Ahmedabad (FRN - 112647W) who wereappointed as the statutory auditors of the Company for a period of five years from theconclusion of 20thAGM till conclusion of the 25th AGM to be held inthe year 2020 will be Continued as the Statutory Auditors of the Company. The ratificationof Appointment of M/s. B. K. Patel & Co. will be made in the ensuing 21stAnnual General Meeting of the Company. Statutory Audit Report is attached to this reportas "Annexure – C." The Auditors’ Report of the Companyfor the accounting year ended March 31 2016 does not contains any qualifications on theFinancials or working of the Company:

Secretarial Auditor & their report

Pursuant to the provisions of section 204 of the Act and The Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014 the Company has appointed Mr. AnandLavingia Practicing Company Secretary Ahmedabad to carry out the Secretarial Audit forthe financial year ended on March 31 2016. Secretarial Audit Report is attached to thisreport as "Annexure – B."

The Secretarial Auditors’ Report of the Company for the Financial Year ended March31 2016 contains following qualifications:

a. Publication of Newspaper Advertisement for fixation of book closure under section 91and of Act;

b. Appointment of Chief Financial Officer under section 203 of the Act;

c. Providing of e-voting facility for voting on the resolutions mentioned in the noticeof annual general meeting under section 108 of the Act;

d. Company has not constituted various committees as required under section 177 &178 of the Act however the Board of Directors of the Company has formed variouscommittees as required on or after August 4 2015 and

e. Filing of few Resolutions as required under section 179 of the act.

The management replies for the Audit Qualifications are as under:

Due to the unavaibility of proper Compliance mechanism and qualified official theCompany failed to comply with certain above mentioned Statutory Requirement during theyear under Review. The management assures to comply all the statutory requirementhereinafter and maintain proper records thereof.

DIRECTORS’ RESPONSIBILITY STATEMENT:

In terms of section 134(5) of the Act your Directors state that: i.) in thepreparation of the annual financial statements for the year ended on March 31 2016applicable accounting standards read with requirements set out under schedule III of theAct have been followed along with proper explanation relating to material departures ifany ii.) such accounting policies have been selected and applied consistently andjudgments and estimates made that are reasonable and prudent so as to give a true and fairview of the state of affairs of the company as at March 31 2016 and of the profit of thecompany for the year ended on that date iii.) proper and sufficient care has been takenfor maintenance of adequate accounting records in accordance with the provisions of thisAct for safeguarding the assets of the company and for prevention and detection of fraudand other irregularities iv.) the annual financial statements are prepared on a goingconcern basis v.) proper internal financial controls are in place and that the financialcontrols are adequate and are operating effectively and vi.) the systems to ensurecompliance with the provisions of all applicable laws are in place and are adequate andoperating effectively.

GENERAL DISCLOSURE:

Your Directors state that the Company has made disclosures in this report for the itemsprescribed in section 134(3) of the Act and Rule 8 of The Companies (Accounts) Rules 2014to the extent the transactions took place on those items during the year. Your Directorsfurther state that no disclosure or reporting is required in respect of the followingitems as there were no transactions on these items during the year under review:

1. Details of Annual Report on Corporate Social Responsibility as Company is notfalling within the criteria as prescribed u/s 135 of the Companies Act 2013

2. Issue of Equity Shares with differential rights as to dividend voting or otherwise.

3. Issue of shares (including sweat equity shares) to employees of the Company underany scheme save and ESOS.

4. Details of Contracts and arrangement with the related parties.

5. No significant or material orders were passed by the Regulators or Courts orTribunals which impact the going concern status and Company’s operations in future.

ACKNOWLEDGEMENT:

Your Directors take this opportunity to place on record the valuable co-operation andsupport extended by the banks government business associates and the shareholders fortheir continued confidence reposed in the Company and look forward to having the samesupport in all future endeavors.

Registered Office: For and on behalf of Board
55 World Business House For Sword and Shield Pharma Limited
Near Parimal Garden
Ambawadi
Ahmedabad 380 006. Mr. Pravin Patel Mrs. Jyotsnaben Patel
Place : Ahmedabad Managing Director Director
Date : September 2 2016 (DIN: 01877446) (DIN: 01877469)