The Members of
The Baroda Rayon Corporation Limited
Your Directors are pleased to present the 57th Annual Report and the AuditedStatement of Accounts for the year ended 31st March 2017. The Financialresults are shown as below.
| || ||(Rs In Lakhs) |
|Particulars ||31.03.2017 ||31.03.2016 |
|Income from Sales ||NIL ||NIL |
|Other Income ||NIL ||NIL |
|Total Income ||NIL ||NIL |
|Less: Expenditure ||218.99 ||86.97 |
|Profit/(Loss) before interest depreciation and tax ||(218.99) ||(86.97) |
|Less : Depreciation ||NIL ||303.94 |
|Interest ||60.05 ||25.87 |
|Provisions for Taxation ||Nil ||Nil |
|Profit/(Loss) before extraordinary item ||(279.04) ||(416.78) |
|Less: Extraordinary Item ||(257.11) ||- |
|Profit/(Loss) after Taxes ||(21.93) ||(416.78) |
|Profit/(Loss) available for appropriation ||(21.93) ||(416.78) |
|Balances as per last year's Balance sheet ||(34888.49) ||(35925.41) |
|Profit and Loss Appropriation Account ||NIL ||NIL |
|Balance carried to Balance sheet ||(34910.42) ||(34888.49) |
Overview of Company's Financial Performance
Your company's net loss is Rs 21.93 lakhs as against Rs 416.78 lakhs in the previousyear. Interest cost has increased to Rs 60.05 lakhs as against Rs 25.87 lakhs in previousyear. Total expenditure of your company has increased to Rs 218.99 lakhs as against Rs86.97 lakhs in previous year.
Your Directors regret their inability to recommend any dividend for the financialperiod under review in view of the continued losses.
The issued subscribed and paid-up equity share capital of the company as on 31st March2017 is Rs 2291.14 lakhs. During the year under review the Company has not issued shareswith differential voting rights nor granted stock options nor sweat equity. As on 31stMarch 2017 none of the Directors of the company holds equity shares in the company.
Transfer to Reserves
During the year under review no amount was transferred to General Reserve.
Change in nature of business
During the year under review there is no change in the nature of business of thecompany.
Review of Operation
During the year under review no production/manufacturing activities were carried on bythe company. Hence No information is provided regarding the performance of the company.Your company is seeking new avenues in order to restart the operations of your company.
Material changes and commitment affecting the financial position of the companyoccurred between the end of the financial year to which this financial statements relateand the date of the report
The Company is a sick unit and was registered under The Board of Industrial andFinancial Restructuring (BIFR) vide case no. 67/2004. Further in pursuant to Insolvencyand Bankruptcy Code (Removal of Difficulties) Order 2017 vide notification dated24/05/2017 issued by Ministry of Corporate Affairs relating to amendment to the SickIndustrial Companies (Special Provisions) Repeal Act 2003 provided that any schemesanctioned under sub-section (4) or any scheme under implementation under sub-section (12)of section 18 of the Sick Industrial Companies (Special Provisions) Act 1985 shall bedeemed to be an approved resolution plan under sub-section (1) of section 31 of theInsolvency and Bankruptcy Code 2016 and the same shall be dealt with in accordance withthe provisions of Part II of the said Code. The said notification will be examined inrelation to company's sanctioned scheme (SS06)/MDRS scheme and necessary action if anyrequired shall be initiated and the Board will be appraised.
Directors' Responsibility Statement
In accordance with the provisions of Section 134(5) of the Companies Act 2013 theBoard hereby submit its responsibility Statement:
a) in the preparation of the annual accounts for the year ended March 31 2017 theapplicable accounting standards read with requirements set out under Schedule III to theAct have been followed and there are no material departures from the same; b) theDirectors have selected such accounting policies and applied them consistently and madejudgements 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 March 31 2017 and of the loss of theCompany for the year ended on that date;
c) the Directors have taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of the 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 have laid down internal financial controls to be followed by theCompany and that such internal financial controls are adequate and are operatingeffectively; and
f) the Directors have devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems are adequate and operating effectively.
SUBSIDIARIES JOINT VENTURES AND ASSOCIATE COMPANIES
Your Company does not have any Subsidiaries Joint Ventures and Associate Companies.
During the financial year 2016-17 your Company has not accepted any fixed depositswithin the meaning of section 73 and 74 of the Companies Act 2013 read together with theCompanies (Acceptance of Deposits) Rules 2014.
However deposits of Rs 1.95 lakhs were outstanding as at 31st March 2017as the matter is disputed.
Directors and key managerial personnel
In accordance with the provisions of the Act and the Articles of Association of theCompany Mr. Damodarbhai Patel retires by rotation at the forthcoming Annual GeneralMeeting and being eligible offers himself for re-appointment.
The resolutions seeking approval of the members for the re-appointment of Mr.Damodarbhai Patel as Managing Director for further 5 years have been incorporated in theNotice of the Annual General Meeting of the Company along with brief details about him.
In pursuant to Government Notification S.O. No 3568(E) dated 25.11.2016 and S.O.3569(E) dated 25.11.2016 the Board for Industrial & Financial Reconstruction ( BIFR)has been wound up w.e.f. 01.12.2016 and accordingly Mr. Prashant Panda who was appointedby BIFR as Nominee Director of the company ceases to be the director of the company.
The Board has appointed Mr. Kunjal Sawan Desai (ACS-40809) as Company Secretary cumCompliance Officer of the company w.e.f. 01st June 2016.
The Key Managerial Personnel (KMP) in the Company as per Section 2(51) and Section 203of the Companies Act 2013 are as follows:
(i) Mr. Damodarbhai Patel Managing Director (ii) Mr. Kunjal Desai* Company Secretary
*Appointed w.e.f. 01st June 2016.
Disclosure relating to Remuneration and Nomination Policy
The Board of Directors has framed a policy which lays down a framework in relation toremuneration of Directors Key Managerial Personnel and Senior Management of the Company.This policy also lays down criteria for selection and appointment of Board Members. Thedetails of this policy is explained in Corporate Governance Report.
During the year under review no director was paid any remuneration.
Independent Directors' Meeting
Independent Directors of the Company had met during the year under review details ofwhich are given in the Corporate Governance Report.
Pursuant to the provisions of the Companies Act 2013 and SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 the Board has carried out an annualperformance evaluation of its own performance the directors individually as well as theevaluation of the working of its Audit Nomination & Remuneration and StakeholdersRelationship Committees. The manner in which the evaluation has been carried out has beenexplained in the Corporate Governance Report.
The details of the number of Board and other Committee meetings of your Company are setout in the Corporate Governance Report which forms part of this Report.
Declaration by independent directors
The Company has received necessary declaration from each Independent Director underSection 149(7) of the Companies Act 2013 that he meets the criteria of independence aslaid down in Section 149(6) of the Companies Act 2013 and Regulation 25 of SEBI ( ListingObligations and Disclosure Requirements) Regulations 2015. The Board relies on theirdeclaration of independence.
Committees of the Board
There are currently three Committees of the Board as follows:
1. Audit Committee
2. Nomination and Remuneration Committee 3. Stakeholders' Relationship Committee
Details of all the Committees along with their charters composition and meetings heldduring the year are provided in the "Report on Corporate Governance" a part ofthis Annual Report.
Corporate Governance Report
As per Regulation 34(3) read with Schedule V of the SEBI ( Listing Obligations andDisclosure Requirements) Regulations 2015 a separate section on corporate governancepractices followed by the Company together with a certificate from the Company's Auditorsconfirming compliance forms an integral part of this Report.
A. Statutory Auditors
M/s. AMPAC & Associates Chartered Accountants Mumbai have tendered theirresignation from the position of Statutory Auditors due to pre-occupation with otherassignments resulting into a casual vacancy in the office of Statutory Auditors of thecompany as envisaged by section 139(8) of the Companies Act 2013 ( "Act").Casual vacancy caused by the resignation of auditors can only be filled up by the Companyin general meeting. Board proposed that M/s. Kansariwala & Chevli CharteredAccountants Surat be appointed as the Statutory Auditors of the Company to fill thecasual vacancy caused by the resignation of M/s. AMPAC & Associates CharteredAccountants. M/s. Kansariwala & Chevli Chartered Accountants Surat have conveyedtheir consent to be appointed as the Statutory Auditors of the Company along with aconfirmation that their appointment if made by the members would be within the limitsprescribed under the Companies Act 2013.
B. Secretarial Auditor
Mr. Manish Patel Practicing Company Secretary Surat was appointed to conduct thesecretarial audit of the Company for the financial year 2016-17 as required under Section204 of the Companies Act 2013 and Rules thereunder. The secretarial audit report for FY2016-17 forms part of the Annual Report as "Annexure A" to the Board's report.
The Board has appointed Mr. Manish Patel Practicing Company Secretary as secretarialauditor of the Company for the financial year 2017-18.
The observations made by the Auditors are self explanatory and have also been explainedin the notes forming part of the accounts wherever required.
Related Party Transactions
During the financial year 2016-17 there were no transactions with related partieswhich qualify as material transactions under the Listing Regulations and that theprovisions of section 188 of the Companies act 2013 are not attracted. Thus disclosure inform AOC-2 is not required. Further there were not material related party transactionsduring the year under review with the Promoters Directors of Key Managerial Personnel.
Loans Guarantees and Investments
The details of loans guarantees and investments under Section 186 of the CompaniesAct 2013 read with the Companies (Meetings of Board and its Powers) Rules 2014 are asfollows:
A). Details of investments made by the Company as on 31st March 2017(including investments made in the previous years) (in equity shares):
| ||(Rs in lakhs) |
|Name of Company ||Amount as at 31st March 2017 |
|ICICI Bank Ltd. ||- |
|Hindustan Organic Chemicals Ltd. ||0.25 |
|Thai Baroda Industries Ltd. ||574.85 |
|TAIB Capital Corporation Ltd. ||24.50 |
|Zoroastrian Co-op. Bank Ltd. ||0.01 |
|Total ||599.61 |
B). There are no loans given by your Company in accordance with Section 186 of theCompanies Act 2013 read with the Rules issued thereunder.
C). There are no guarantees issued by your Company in accordance with Section 186 ofthe Companies Act 2013 read with the Rules issued thereunder.
Conservation of Energy Technology Absorption and Foreign Exchange Earnings & Outgo
The information on conservation of energy technology absorption and foreign exchangeearnings and outgo stipulated under Section 134(3)(m) of the Companies Act 2013 read withRule 8 of The Companies ( Accounts) Rules 2014 are as under-
(A) Conservation of Energy:
The production and manufacturing activities are not carried on by the Company and dueto that no usage of energy. Hence no steps are taken by the Company for conservation ofenergy.
(B) Technology Absorption:
The company has not imported any technology during the year and as such there isnothing to report.
|(C) Foreign Exchange Earnings and Outgo: || ||(Rs In Lakhs) |
| ||31.03.2017 ||31.03.2016 |
|Foreign Exchange Earnings ||NIL ||NIL |
|Foreign Exchange Outgoings ||NIL ||NIL |
A certificate from the Auditors of the company regarding compliance of conditions ofCorporate Governance as stipulated under SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 is attached to this report.
Extract of Annual Return
In accordance with Section 134(3)(a) of the Companies Act 2013 an extract of theannual return in the prescribed format is appended as "Annexure B" to theBoard's report.
Management's view on Statutory Auditors Qualification:
Your Company's applications before the Hon'ble Gujarat High Court are pending and themanagement desire to act as per the directions given by the respective authorities.
Management's view on Secretarial Auditors Qualification:
In respect of the Qualifications as stated in the Secretarial Audit Report yourmanagement is of the view that
1) Your company has not appointed Chief Financial Officer as Key Managerial Personnelspecified under section 203 of the Companies Act 2013 however company is in search ofthe rightful candidate and will do the needful at the earliest.
2) Your Company is a sick unit under the Board for Industrial & FinancialReconstruction ( BIFR) andthe entire production/manufacturing activities of the companybecame stand still since August' 2008 and due to loss of key personnel responsible for thevarious compliances the non compliances as stated in the Secretarial Report regardingCompanies Act 2013 and LODR has occurred. However your company has during the yearappointed key personnel responsible for the compliances of the same.
Cash Flow Analysis
The Cash Flow Statement for the year under reference in terms of Regulation 34 of SEBI(Listing Obligations and Disclosure Requirements) Regulations 2015 forms part of theAnnual Report.
Your Company is committed to highest standards of ethical moral and legal businessconduct. Accordingly the Board of Directors have formulated a Whistle Blower Policy whichis in compliance with the provisions of Section 177 (10) of the Companies Act 2013 andRegulation 22 of SEBI ( Listing Obligations and Disclosure Requirements) Regulations2015. The policy provides for a framework and process whereby concerns can be raised byits employees against any kind of discrimination harassment victimization or any otherunfair practice being adopted against them. More details on the vigil mechanism and theWhistle Blower Policy of your Company have been outlined in the Corporate GovernanceReport which forms part of this report.
Disclosures as per the Sexual Harassment of Women at Workplace (Prevention Prohibitionand Redressal) Act 2013.
The Company has zero tolerance for sexual harassment at workplace and has adopted aPolicy on prevention prohibition and redressal of sexual harassment at workplace in linewith the provisions of the Sexual Harassment of Women at Workplace (PreventionProhibition and Redressal) Act 2013 and the Rules thereunder for prevention and redressalof complaints of sexual harassment at workplace.
Since your company is having no operative activities it has not received any complainton sexual harassment during the financial year 2016-17.
Particulars of Employees
The statement containing particulars of employees as required under Section 197(12) ofthe Companies Act 2013 read with Rule 5(2) of the Companies (Appointment and Remunerationof Managerial Personnel) Rules 2014 forms part of this Report as "Annexure C".
Details on internal financial controls related to financial statements
Your Company has adopted accounting policies which are in line with the AccountingStandards prescribed in the Companies ( Accounting Standards) Rules 2006 that continue toapply under Section 133 and other applicable provisions if any of the Companies Act2013 read with Rule 7 of the Companies (Accounts) Rules 2014. These are in accordancewith generally accepted accounting principles in India.
Significant/Material orders passed by the regulators
During the year under review no significant/material orders were passed by anyregulator.
a) Your Company has not issued equity shares with differential rights as to dividendvoting or otherwise; and
b) Your Company does not have any ESOP scheme for its employees/Directors.
Your Directors wish to place on record their appreciation towards all associatesincluding Customers Collaborators Strategic Investors Government Agencies FinancialInstitutions Bankers Suppliers Shareholders Employees and other who have reposed theirconfidence in the company during the period under review.
|Place: Surat ||By order of the Board of Directors |
|Date: 01st September 2017 || |
| ||Damodarbhai B Patel |
| ||Chairman & Managing Director |
| ||DIN: 00056513 |