We have pleasure in presenting the 6th Director Report on the business and operationsof Company and Financial Results for the year ended 31st March 2019.
1. FINANCIAL RESULTS
| ||2018-2019 ||2017-2018 |
|Turnover Revenue ||323.50 ||62.32 |
|Gross Profit before financial charges & depreciation ||(47.71) ||(154.16) |
|Less: Depreciation ||127.34 ||130.01 |
|Financial charges ||65.24 ||70.83 |
|Exceptional items ||- ||81.37 |
|Profit / (Loss) before taxation ||(240.29) ||(436.37) |
|Profit / (Loss) after taxation ||(240.29) ||(436.37) |
During the year under review the company achieved total turnover of Rs.323.50 Lakhswhich is higher than that of the previous year. The operations in the year have ended in aloss of Rs.240.29 Lakhs as against loss of Rs. 436.37 Lakhs in previous year.
The Company's has started Job Work operations partially during end of the yeartherefore higher turnover is recorded in the current year a compared to last year.
3. CHANGE IN SHARE CAPITAL
There is no change in Share Capital of the company during the year under review.
Your Directors do not propose to carry any amount to General Reserve Account as theCompany has incurred losses during the financial year.
In view of losses incurred by the Company during the year under review the Board isunable to recommend dividend.
6. FUTURE OUTLOOK
Company's future outlook is expected to be challenging in view of global economicsituation.
7. CORPORATE GOVERNANCE
The report on Corporate Governance is not being enclosed to this report in view of therelaxation under regulation 15(2) of SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015.
8. MANAGEMENT DISCUSSION AND ANALYSIS REPORT
Management's Discussion and Analysis Report for the year under review as stipulatedunder Regulation 34 read with Schedule V of SEBI (Listing Obligations and DisclosureRequirements) 2015 is presented in a separate section forming part of the Annual Reportas Annexure - IV.
9. ENVIRONMENT AND POLLUTION CONTROL
The manufacturing facility has obtained environmental clearance from the PollutionControl Board concerned and is in compliance with all current environmental legislation.As an integral part of its environment protection drive the Company ensures the veryminimum quantity of generation of waste low emission levels and low noise pollutionlevels during operations of its manufacturing facility.
10. DIRECTORS AND KEY MANAGERIAL PERSONNEL
A. APPOINTMENT OF KEY MANAGERIAL PERSONNEL AFTER THE CLOSURE OF FINANCIAL YEAR AND TILLTHE DATE OF THE REPORT
Board of Directors appointed Ms. Rozie Sushant Mukharjee as a Company Secretary &Compliance Officer of the Company w.e.f 30th May 2019.
B. RETIREMENT BY ROTATION
Pursuant provision of Section 152 of the Companies Act 2013 Sri Devender KumarAgarwal (DIN 00042156.) Director will retire at the ensuing Annual General Meeting andbeing eligible offers himself for re-appointment. The Board recommends his re-appointment
C. EVALUATION OF THE BOARD'S PERFORMANCE
In compliance with the Companies Act 2013 and as per the Listing Regulations theperformance evaluation of the Board and of its Committee was carried out during the yearunder review.
The Directors evaluation was broadly based on the parameters such as understanding ofthe Company's vision and objective skills knowledge and experience participation andattendance in Board/ Committee meetings; governance and contribution to strategy;interpersonal skills etc.
The Board has carried out the annual performance evaluation of its own performance theDirectors individually as well as evaluation of the working of its Board Committees. Astructured questionnaire was prepared covering various aspects of the Board's functioningsuch as adequacy of the composition of the Board and its Committees Board Cultureexecution and performance of specific duties obligations and governance.
A meeting of the Independent Directors was also held which reviewed performance ofnon-independent directors performance of the board as a whole and performance of thechairman after taking in to account the views of executive directors and non-executivedirectors. The same was discussed in the board meeting that followed the meeting of theindependent directors at which the performance of the board its committees andindividual directors was also discussed. Performance evaluation of independent directorswas done by the entire board excluding the independent director being evaluated.
D. DECLARATION BY INDEPENDENT DIRECTORS
All the Independent Directors of the Company have given declaration stating that theymeet the criteria of independence as provided under Companies Act 2013.
E. FAMILIARIZATION PROGRAMME FOR INDEPENDENT DIRECTORS
The Company has formulated a familiarization program for Independent Directors toprovide insights into the Company's manufacturing marketing finance and other importantaspects to enable the Independent Directors to understand its business in depth andcontribute significantly to the Company. The details of such program are available on theCompany's website (www.aanandalakshmi.com)
11. BOARD AND THEIR COMMITTEES
1. BOARD OF DIRECTORS
a) Composition and Number of Board Meetings:
As on 31stMarch 2019 the Company's Board of Directors comprises 5 (Five) Directors.Of these 2 (two) are Promoter Directors and 3 (three) are Independent Directors.
The Chairman is being appointed on each Board Meeting and Annual General Meeting.
The Board of Directors of the Company met Four (4) times during the year i.e on30.05.2018 14.08.2018 14.11.2018 and 05.02.2019.
b) Disclosure of relationships between directors inter-se:
Except for Sri Devender Kumar Agarwal and Sir Jeetender Kumar Agarwal being brothersthere is no inter-se relationship between other Board Members.
2. AUDIT COMMITTEE
The Audit Committee comprises of Sri Surender Kumar Agarwal (Chairman) Sri ManishGupta and Sri Devender Kumar Agarwal as other members. All the recommendations made by theAudit Committee were accepted by the Board.
During the financial year ended March 312019 - Four (4) Audit Committee Meetings wereheld on 30.05.2018 14.08.2018 14.11.2018 and 05.02.2019.
3. STAKEHOLDERS' RELATIONSHIP COMMITTEE
Your company has constituted a Stakeholders' Relationship Committee to specificallylook into the mechanism of redressal of grievances of shareholders and other securityholders.
The Stakeholders Relationship Committee comprises of Sri Manish Gupta and Sri DevenderKumar Agarwal.
Sri Manish Gupta (Chairman) is the Non-Executive Director heading the Committee.
Details of the complaint received and redressed during the year under review are asfollows:
|1 ||No. of Complaints received for the 4th Quarter ||NIL |
|2 ||No. of Complaints received for the Yfear ended 31st March 2019 ||NIL |
|3 ||Number not solved to the satisfaction of shareholders ||NIL |
|4 ||Number of pending complaints ||NIL |
12. AUDITORS & AUDITORS' REPORT
A. STATUTORY AUDITORS
M/s K.S.Rao & Co. Chartered Accountants Hyderabad (ICAI Firm Regn. No.003109S)were appointed as Statutory Auditors in the AGM held on 29th September 2017 for a periodof 5 years until the conclusion of 9th AGM.
Ministry of Corporate Affairs vide its notification dated May 7 2018 has done awaywith the requirement of seeking ratification of appointment of statutory auditors bymembers at each AGM. Accordingly no such item has been considered in notice of the 6thAGM.
Following are the replies/clarifications in respect of the observations made by thestatutory auditors in their audit report.
The management is of the considered opinion based on the discussed with the banks/financial institutions that the liabilities with the banks would be settled in view ofthe One Time Settlement (OTS)sanction letters issued by them to the Company. Company plansto generate the funds by sale of assets to meet the OTS liability. Company also plans todiversify the operations and generate future cash flows. Thus the Company is confident ofsettling the statutory liabilities.
For the reasons stated above company's accounts have been prepared on going concernbasis.
Interest on bank loans was not provided in view of One Time Settlement Sanction lettersissued by them to the company for settlement of liabilities at a percentage of principalliability only. There fore recognizing interest liability in the books did not arise.
With reference to the observation made under the head Evaluation of uncertain taxpositions the note No. 40 disclosing the contingent liabilities is self explanatory.
With reference to the Auditors' observations on Note Nos. 4243444546 to thefinancial statements the Board considers the respective notes themselves are selfexplanatory.
B. SECRETARIAL AUDITOR
During the year the Company has appointed M/s NVSS Suryanarayana Rao PracticingCompany Secretaries as Secretarial Auditor in compliance with the provision of Section 204of the Companies Act 2013.The Secretarial Audit report in form MR-3 for the financialyear ended 31st March 2019 is annexed herewith as Annexure I to this Report.
The secretarial audit report does not contain any qualifications or adverse remark.
13. DIRECTORS' RESPONSIBILITY STATEMENT:
To the best of their knowledge and belief and according to the information andexplanations obtained by them 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 hadbeen followed along with proper explanation relating to material departures;
(b) 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 at the end of the financial year and ofthe profit and loss of the company for that period;
(c) the directors had 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 had 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; and
(f) the directors had devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems were adequate and operating effectively.
14. RELATED PARTY TRANSACTIONS
All related party transactions that were entered into during the financial year were onarm's length basis and were in the ordinary course of business. There are no materiallysignificant related party transactions made by the Company with Promoters Directors KeyManagerial Personnel or other designated persons which may have a potential conflict withthe interest of the Company at large. Thus disclosure in Form AOC-2 is not required.
All Related Party transaction are presented to the Audit Committee and the board.Omnibus approval is obtained for the transactions which are foreseeable and repetitive innature. A Statement of all related party transactions is presented before the AuditCommittee and the Board on a quarterly basis specifying the nature value and terms andconditions of the transactions. The Policy on materiality of related party transactions asapproved by the Board may be accessed on the Company's website at http://www.aanandalakshmi.com/policy-policy.html
Your Directors draw attention of the members to Note 35 to the financial statementwhich sets out related party disclosures.
15. CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION FOREIGN EXCHANGE EARNINGS AND OUTGO:
The particulars relating to conservation of energy technology absorption foreignexchange earnings and outgo required to be given pursuant to the provision of Section 134of the Companies Act 2013 read with the Companies (Account) Rules 2014 is annexed heretoand marked Annexure II and forms part of this Report.
16. INDIAN ACCOUNTING STANDARDS (IND AS)
The Ministry of Corporate Affairs vide its notification dated 16.02.2015 has notifiedthe Companies (Indian Accounting Standard) Rules 2015. In pursuance of this notificationthe company has adopted IND AS with effect from 1st April 2017
17. INTERNAL FINANCIAL CONTROLS
The Company has in place adequate internal financial controls with reference tofinancial statements. During the year such controls were tested and no reportablematerial weakness in the design or operation was observed.
18. PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES:
The information required pursuant to Section 197(12) of Companies Act 2013 read withRule 5(1) and Rule 5(2) of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014 in respect of the employees of the Company will be provided uponrequest. In terms of Section 136 of the Act the Report and Accounts are being sent to themembers and others entitled thereto excluding the information on employees' particularswhich is available for inspection by the members at the Registered Office of the Companyduring business hours on working days of the Company upto the date of the ensuing AnnualGeneral Meeting. If any member is interested in obtaining a copy thereof such member maywrite to the Company Secretary in this regard.
19. POLICY ON SEXUAL HARASSMENT:
The Company has in place a policy on Prevention of Sexual Harassment of Employees atworkplace in accordance with The Sexual harassment of Women at Workplace (PreventionProhibition and Redressal) Act 2013. Internal Compliant Committee has been set to redresscomplaints received regarding sexual harassment.
During the year under review the Company has not received any complaints pertaining tosexual harassment.
20. PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS UNDER SECTION 186:
The Company has not made any loan given guarantee or provided security pursuant to theprovisions of Section 186 of Companies Act 2013.
A. EXTRACT OF ANNUAL RETURN
Extract of Annual Return of the Company is annexed herewith as Annexure III to thisReport.
B. WHISTLE BLOWER POLICY
The Company has in place a Whistle Blower Policy for vigil mechanism for the directorsand employees to report genuine concerns to the management about unethical behaviorfraud violation of Company's code of conduct and provides adequate safeguards againstvictimization of persons who use such mechanism. The Policy on vigil mechanism may beaccessed on the Company's website at the link: www.aanandalakshmi.com. There were nocomplaints received during the year 2018-19.
Your Directors state that no disclosure or reporting is required in respect of thefollowing items as there were no transactions on these items during the year under review:
a. Details relating to deposits covered under Chapter V of the Act.
b. The Company has no subsidiaries joint ventures or associate companies.
c. The Company is not required to maintain cost records under Section 148(1) of theCompanies Act 2013.
d. 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.
The Board of Directors are pleased to place on record their appreciation of theco-operation and support extended by All Financial Institutions Banks and various Stateand Central Government Agencies.
The Board would also like to thank the Company's shareholders customers suppliers forthe support and the confidence which they have reposed in the management. The Board placeon record its appreciation of the contribution made by the employees at all levels fortheir hard work solidarity co-operation and support.
By order of the Board For Aananda Lakshmi Spinning Mills Limited
| ||Devender Kumar Agarwal |
| ||Managing Director |
| ||DIN:00042156 |
| ||Surender Kumar Agarwal |
|Place: Secunderabad ||Director |
|Date: 14.08.2019 ||DIN:00281576 |