The Directors of the Company present their 38th Annual Report andCompany's Audited Accounts for the year ended 31st March 2021.
The financial results for the year ended 31st March 2021 and thecorresponding figures for the last year are as under:
| || ||(Amount in Rs. Lakhs) |
| ||2020-21 ||2019-20 |
|Profit before Interest Depreciation and Tax ||967.99 ||481.80 |
|Less: Finance Cost ||183.13 ||238.27 |
|Depreciation & Amortization Expense ||381.08 ||460.37 |
| ||564.21 ||698.64 |
|Profit/(Loss) after Interest & Depreciation but before Tax ||403.78 ||(216.84) |
|Less: Tax Expense for Current Year ||- ||- |
|Income Tax for Earlier Years ||- ||- |
|Deferred Tax Provision/(Written Back) ||67.18 ||(77.24) |
| ||67.18 ||(77.24) |
|Profit/(Loss) from continuing operations ||336.60 ||(139.60) |
|Profit/(Loss) before Tax from Discontinued operations ||(6.51) ||22.69 |
|Less: Tax Expense of Discontinued operations ||(1.81) ||17.07 |
|Profit/(Loss) afterTax from Discontinued operations ||(4.70) ||5.62 |
|Other Comprehensive Income for the year ( net of tax) ||(35.51) ||(52.37) |
|Total Comprehensive income for the year ||296.39 ||(186.35) |
TRANSFER TO RESERVES
The Balance in Other Equity stands at ' 8796.60 Lakhs (Previous year '8500.21 Lakhs). The Company has transferred ' 100 Lakhs to General Reserve.
Your Directors are pleased to recommend payment of Dividend of ' 1.00per Equity Share on face value of ' 10/- each (Previous year ' Nil per Equity Share) forthe year ended 31st March 2021 amounting to ' 9005985 lakhs subject to the approval ofmembers at the ensuing Annual General Meeting.
Impact of COVID-19 Pandemic
COVID-19 Pandemic has caused unprecedented economic disruption globallyand in India.The onset of second wave of COVID 19 once again resulted in massive economicand human loss. The Company has been monitoring the situation closely and has takenvarious measures to comply with directions / regulations / guidelines issued by theGovernment and local bodies to ensure safety of workforce across all its factories andoffices. The Company has also taken steps for the vaccination of all employees.
The extent to which the COVID-19 pandemic will impact the Company'sresults will depend on future developments which are highly uncertain including amongother things market conditions due to lockdown situation if any prevailing in thevarious parts of the country.
During the year under review due to National lockdown all India croploss was 145 million kgs i.e. 10.5%. Production in our area have been severly affected andwas lower by 25%. however the profit have been significantly better due to substantialimprovement in average sales realistion.
Your Directors expect the current year production to be normal. Inspiteof wage rate increase from Rs. 167 to Rs. 205 we expect favorable year on account oflower cost of production due to increased production. Your Company is taking necessarysteps for manufacturing Quality teas . The tea markets have been very buoyant for qualityteas which has led to good demands from packeters in the domestic market. The outlook forthe division in the current year seemed optimistic.
The year started with the spike in covid cases. But the expectationsare there that the demand will bounce back along with the opening of the markets after thesecond wave shutdowns are over as it happened with the opening up of the markets afterfirst wave of Covid lockdown.
Year under review started with national lockdown and curfew inAhmedabad resulting in loss of production in the first half of the year. Thereafter themarkets bounced back and there was robust demand which led to improved margins of thisdivision.
Also the weaving section with 63 looms were shutdown and workers wereretrenched amicably. Sale of surplus machinery of this divison helped improve the cashflow.
In the current year we expect the favorable trend in demand from thesecond quarter onwards and company is also working out modernisation plan to improve theproduct mix and quality completion of which will augur favourably for the future of thisdivision.
Land & Building at Asarwa House
In order to strengthen the Cashflows of the Company we had entered intoa contract with M/s Simni Infracon LLP Ahmedabad for sale of company's bunglow situatedat Asarwa House Dr. Balwantrai Mehta Marg Shahibaug Ahmedabad Gujarat at a price of K.33.30 Crores on 25th September 2020. However the same was cancelled due to the uncertaineconomic situation following Corona Virus (COVID 19) pandemic and the resultant lockdownson 11th February 2021. As and when the COVID - 19 situaton in India improveswe are hoping for progress on this front.
Subsidiary of Rydak Enterprises & Investment Limited
The Company is a subsidiary of Rydak Enterprises & InvestmentLimited (CIN: U15491WB1983PLC036235) Promoter with a holding of 5060870 equity sharesi.e. 56.19% of the total Share Capital of the Company.
MATERIAL CHANGES OCCURRED BETWEEN THE END OF THE FINANCIAL YEAR UNDERREVIEW AND THE DATE OF THE REPORT
Except those disclosed in this Annual report there are no materialchanges and commitments affecting the financial position of the Company which haveoccurred between the end of the financial year to which the financial statements relateand the date of the report.
MANAGEMENT DISCUSSION AND ANALYSIS REPORT
Management Discussion and Analysis Report for the year under review asstipulated under the Listing Regulations is set out in the annexure forming part of theAnnual Report marked as Annexure - "A".
CORPORATE GOVERNANCE REPORT
The Report on Corporate Governance in accordance with the ListingRegulations approved by the Board together with a Certificate from Mrs. Swati Bajaj (CPNo. 3502 Membership No. FCS 13216) of M/s Bajaj Todi & Associates PractisingCompany Secretaries of 225D A.J.C.Bose Road 3rd Floor Kolkata 700 020 regardingcompliance with the conditions of Corporate Governance are set out in the annexure formingpart of the Annual Report marked as Annexure - "B".
Your Company has taken adequate steps for strict compliance withCorporate Governance guidelines as amended from time to time.
In terms of Section 92(3) of the Act the Annual Return for thefinancial year ended March 31 2021 is displayed on the website of the Companywww.benealtea.com and forms an integral part of this Annual Report.
During the year under review 5 (five) meetings of the Board ofDirectors were held on 23rd May 2020 31st July 2020 15th September 2020 9thNovember 2020 and 12th February 2021.
Apart from meeting of the Board of Directors different committees metseveral times during the financial year ended 31st March 2021. DIRECTORS' RESPONSIBILITYSTATEMENT PURSUANT TO SECTION 134(3)(c) OF THE COMPANIES ACT 2013
The Directors hereby confirm that -
a) in the preparation of the annual accounts for the Financial Yearended 31st March 2021 the applicable accounting standards had been followed along withproper explanation relating to material departures;
b) they had selected such accounting policies and applied themconsistently and made judgements and estimates that are reasonable and prudent so as togive a true and fair view of the state of affairs of the Company at the end of thefinancial year and of the profit of the company for that period;
c) they had taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with the provisions of this Act for safeguardingthe assets of the Company and for preventing and detecting fraud and other irregularities;
d) they had prepared the annual accounts on a going concern basis;
e) they had laid down internal financial controls relating to financialmatters to be followed by the company and that such internal financial controls areadequate and were operating effectively; and
f) they had devised proper systems to ensure compliance with theprovisions of all applicable laws and that such systems were adequate and operatingeffectively.
The Company is in compliance with the applicable Secretarial Standardsissued by the Institute of Company Secretaries of India and approved by the CentralGovernment u/s 118 (10) of the Act.
DECLARATION BY INDEPENDENT DIRECTORS
Independent Directors namely Mr. Golam Momen (DIN: 00402662) Mr.Dhirendra Kumar (DIN: 00153773) Mr. Navin Nayar (DIN: 00136057) and Mr. Ashutosh Bhagat(DIN: 00059842) have given declaration confirming that they comply with the requirementsof Section 149(6) of the Companies Act 2013 and Regulation 16(1) (b) of the ListingRegulations. In the opinion of the Board of Directors the Independent Directors fulfilthe conditions of independence specified in Section 149(6) of the Act and Regulation 16(1)(b) of the Listing Regulations. The Independent Directors have also confirmed that theyhave complied with the Company's Code of Conduct.
Mr. Abhijit Datta Independent Director of the Company had resignedfrom the Board of the Company w.e.f. 24th February 2021 due to his old age and otherpreoccupations. The Board placed on record their appreciation for his continued supportand guidance.
Mr. Kailash Prasad Khandelwal (DIN: 00914834) retires by rotation atthe ensuing Annual General Meeting and being eligible offers himself for re-appointmentin compliance with the provisions of the Companies Act 2013.
Brief resume of the Mr. Kailash Prasad Khandelwal (DIN: 00914834) nature of his expertise in specific functional areas and details of his directorship andmembership/chairmanship of Board/ Committees as stipulated under the Listing Regulationshas been provided in the Explanatory Statement and Annexure to the Notice of the 38th AGMof the Company.
KEY MANAGERIAL PERSONNELS
The following persons are the Key Managerial Personnels (KMP) of theCompany in compliance with the provisions of the Companies Act 2013:
a) Mr. Adarsh Kanoria (DIN: 00027290) Managing Director
b) Mr. Kailash Prasad Khandelwal (DIN: 00914834) Wholetime Director
c) Mr. Atul Doshi Chief Financial Officer
d) Mrs. Sunita Shah Company Secretary
Remuneration and other details of the KMP's for the year ended 31stMarch 2021 are mentioned in the Extracts of the Annual Return which forms an integralpart of this Report and is available on the Company's website viz. www.bengaltea.com.
NOMINATION & REMUNERATION POLICY
Pursuant to Section 178(3) of the Companies Act 2013 Nomination andRemuneration Committee formulated the criteria for determining qualification positiveattributes and independence of a director. The Committee has also recommended to the Boarda policy relating to the remuneration for directors key managerial personnel SeniorManagement of the Company and other employees.The Policy broadly lays down the guidingprinciples philosophy and the basis for payment of remuneration to Executive andNon-executive Directors (by way of sitting fees and commission) Key Managerial PersonnelSenior Management and other employees. The policy also provides for appointment of KeyManagerial Personnel / Senior Management and performance evaluation which are consideredby the Nomination and Remuneration Committee and the Board of Directors while makingselection of the candidate.
The details of the Nomination and Remuneration Policy is available atthe website of the company www.bengaltea.com. The weblink for the same ishttp://bengaltea.com/wp-content/uploads/2017/08/Nomination-Remuneration-Policy_6.02.2016-min.pdf
The Companies Act 2013 states that formal evaluation needs to be doneby the Board of its own performance and that of its Committees and individual directors.Schedule IV of the Companies Act 2013 states that the performance evaluation ofindependent directors shall be done by the entire Board of Directors excluding thedirector being evaluated. Listing Regulations vide Regulation 25(3) requires a meeting ofIndependent Directors to evaluate the performance of the Non Independent directors.
Accordingly a meeting of the Independent Directors was held on 11thFebruary 2021 wherein the performance of the non-independent directors including theChairman was evaluated. The annual performance evaluation of all the directors and theBoard as a whole was conducted based on the criteria and framework adopted by the Board.The Board of Directors expressed their satisfaction with the evaluation process. Theevaluation process has been explained in the Corporate Governance Report section in thisAnnual Report. The NRC has also reviewed the performance of individual directors based ontheir knowledge of preparation effective participation in meetings understanding oftheir roles as director etc.
During the year 2020-21 your Company did not accept/renew any depositsand as such no amount of principal or interest was outstanding as on 31st March 2021.
AUDITORS AND AUDITORS' REPORT
M/s Singhi & Co. (Firm Regn. No. 302049E) Chartered Accountantswere appointed as Statutory Auditors of the Company to hold office for a period of 5years from the conclusion of the 34th Annual General Meeting till the conclusion of the39th Annual General Meeting of the Company. The Company has received letter from theAuditors to the effect that their appointment is within the prescribed limits under theCompanies Act 2013 and that they are not disqualified.
The Notes on Financial Statements referred to in the Auditors' Reportare self-explanatory and do not call for any further comments. There is no qualificationadverse remarks or disclaimer made by the Statutory Auditors.
SECRETARIAL AUDIT REPORT
A report made by Mrs. Swati Bajaj (CP No. 3502 Membership No. FCS13216) of M/s Bajaj Todi & Associates Practising Company Secretaries of 225DA.J.C.Bose Road 3rd Floor Kolkata 700 020 pursuant to Section 204(1) of the CompaniesAct 2013 read with Rule 9 of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014 is attached as Annexure - "C". The report is free of anyqualification adverse remarks or disclaimer.
REPORTING OF FRAUDS BY AUDITORS
During the year under review neither the statutory auditors nor thesecretarial auditors has reported to the Audit Committee under Section 143(12) of theCompanies Act 2013 any fraud committed against the Company by its officers or employeesthe details of which need to be mentioned in the Board Report.
PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS
The Company has not given any loans or provided any guarantees underSection 186(1) of the Companies Act 2013. However the details of Investments underSection 186(1) of the Companies Act 2013 have been provided at Note No. 12 of theFinancial Statements for the year ended 31st March 2021.
PARTICULARS OF RELATED PARTY TRANSACTIONS
During the year there were no material related party transactions withpromoters the directors or the management their subsidiaries or relatives etc. by yourCompany that may have a potential conflict with the interest of the Company. Accordinglythe disclosure of related party transactions as required under Section 134(3)(h) of theCompanies Act 2013 in Form AOC 2 is not applicable to your Company. All Related PartyTransactions are placed before the Audit Committee for approval. Omnibus approval isobtained on a yearly basis for transactions which are of repetitive nature.
The Company has formulated a policy on Related Party Transactions. Thelink of the policy is http://bengaltea.com/wp-content/uploads/2019/03/Related-Party-Transaction-policy_OCR.pdf.
All related party transactions entered during the Financial Year2020-21 were in the ordinary course of the business and on arm's length basis which havebeen provided in the Notes to the Accounts.
Disclosures of transactions of the Company with any person or entitybelonging to the promoter/promoter group which hold(s) 10% or more shareholding in theCompany
The disclosures of transactions of the Company with any person orentity belonging to the promoter/ promoter group which hold(s) 10% or more shareholding inthe Company is given in Note No. 46 of the Notes to the Financial Statements.
In accordance with the provisions of Section 148 of the Companies Act2013 and the Companies (Audit and Auditors) Rules 2014 the Company is required to appointCost Auditors to audit the cost records of the applicable products of the Company relatingto the Tea and Textile Division and accordingly such accounts are made and records havebeen maintained relating to Tea and Textile Divisions every year.
PARTICULARS OF COST AUDITORS APPOINTED FOR THE FINANCIAL YEAR 2020-21
The Company has appointed the following Cost Auditors for Tea &Textile Division for the year ended 31st March 2021:
|Details of Cost Auditor ||Unit Audited |
|Name: N.D. Birla & Co. ||Textile Division- |
|Address: A-3 Nirant Apartment Opposite Town Hall Near Karnavati Hospital Ellisbridge Ahmedabad Gujarat- 380006 ||Bengal Tea & Fabrics Ltd. Asarwa Mills- Ahmedabad |
|Registration No. allotted by ICWAI: 000028 || |
|Name: D. Radhakrishnan & Co. ||Tea Division- |
|Address: 11A Dover lane Flat B1/34 Kolkata- 700029 ||Bengal Tea & Fabrics Ltd. Ananda Tea Estate- Assam |
|Registration No. allotted by ICWAI: 000018 || |
The Board of Directors on the recommendation of Audit Committee havere-appointed the Cost Auditors to audit the cost accounts relating to the Tea and TextileDivision the Company for the financial year 2021-22. As required under the Act aresolution seeking member's approval for the remuneration payable to the Cost Auditorforms part of the Notice convening the Annual General Meeting for their ratification.
PARTICULARS OF EMPLOYEES
The Company had no employee who were in receipt of more than ' 1.02Crores per annum during the year ended 31st March 2021 or of more than ' 8.5 Lakhs permonth during any part thereof. However the information required pursuant to Section 197of the Companies Act 2013 read with Rule 5(1) 5 (2) and 5 (3) of the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 has been annexed asAnnexure - "D".
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION FOREIGN EXCHANGEEARNINGS AND OUTGO
The information relating to conservation of energy technologyabsorption and foreign exchange earnings and outgo as per Section 134 (3)(m) of theCompanies Act 2013 read with Rule 8 (3) of Companies (Accounts) Rules 2014 is set outin the annexure forming part of the Annual Report marked as Annexure - "E".
RISK MANAGEMENT POLICY
Risk management is embedded in your Company's operating framework. YourCompany believes that managing risks helps in maximizing returns. The Company's approachto addressing business risks is comprehensive and includes periodic review of such risksand a framework for mitigating controls and reporting mechanism of such risks. As perrequirement of Section 134(3)(n) of the Companies Act 2013 the Board of Directors in itsmeeting held on 10th May 2014 had approved the Risk Management Policy. As of now theDirectors do not envisage any element of risk which may threaten the existence of theCompany.
INTERNAL FINANCIAL CONTROL SYSTEMS AND THEIR ADEQUACY
Your Company has an adequate system of internal control procedureswhich are constantly assessed and strengthened with new/revised standard operatingprocedures.The Company's internal control system is commensurate with the size and natureof business. The main thrust of internal audit is to test and review controls appraisalof risks and business processes besides benchmarking controls with best practices in theindustry. Detailed procedural manuals are in place to ensure that all the assets aresafeguarded protected against losses and all transactions are authorized recorded andreported correctly. The internal control systems of the Company were monitored andevaluated by the internal auditors and their audit reports were periodically reviewed bythe Audit Committee. The observations and comments of the Audit Committee are placedbefore the Board and suitable steps are taken to strengthen the controls.
CORPORATE SOCIAL RESPONSIBILITY (CSR)
Pursuant to Section 135 of the Companies Act 2013 the Company hasformed a CSR Committee and formulated a CSR Policy. The details of the same have beenannexed in the prescribed format as Annexure - "F". The average net profit forlast three years to current financial year 2020-21 was negative. Accordingly there was noCSR expenditure for the current financial year.
TRANSFER OF UNPAID DIVIDEND AND SHARES TO THE INVESTOR EDUCATION ANDPROTECTION FUND
Pursuant to the provisions of Section 124 of the Companies Act 2013the declared dividends which remain unpaid or unclaimed for a period of seven years havebeen duly transferred by the Company to the Investor Education and Protection Fund (IEPF)established by the Central Government under Section 125 of the said Act.
The Company has uploaded the details of unpaid and unclaimed amountslying with the Company as on 31st March 2021 on the Company's website (www.benealtea.com)and also on the Ministry of Corporate Affairs' website. The dividend for the undernotedyears if unclaimed for seven years will be transferred by the Company to IEPF:
|Financial Year ||Date of Declaration of Dividend ||Unclaimed Dividend as on 31.03.2021 (Rs.) |
|2013-14 ||09.08.2014 ||636308.00 |
|2014-15 ||08.08.2015 ||176341.00 |
|2015-16 ||01.08.2016 ||187946.00 |
|2016-17 ||NIL ||NIL |
|2017-18 ||NIL ||NIL |
|2018-19 ||NIL ||NIL |
|2019-20 ||NIL ||NIL |
Pursuant to the provision of Section 124 (6) read with Rule 6 ofInvestor Education and Protection Fund Authority (Accounting Audit Transfer and Refund)Rules 2016 (the "IEPF Rules") as amended all shares in respect of whichdividend has/have remained unpaid or unclaimed for consecutive seven years thecorresponding shares shall also be transferred in the name of Demat Account of IEPFAuthority.
Accordingly 26779 equity shares against 435 folios corresponding tothe dividend for the year ended on 31st March 2014 which remains unclaimed for sevenconsecutive years will be transferred to Demat Accout no. 1204720013676780 of IEPFAuthority maintained with SBI CAP Securities Limited through Central Depository Services(India) Limited under IEPF RULES 2017 on 14th September 2021. Notice to the concernedshareholders and advertisement in Newspapers has been given to all such shareholders tomake an application to the Company / Registrar & Share Transfer Agents latest by 31stAugust 2021 with a request for claiming the unpaid dividend so that the shares are nottransferred to the IEPF. The Company has uploaded the details of all shares transferred toDemat account of IEPF Authority as on 31st March 2021 on the Company's websitewww.bengaltea.com.
NAME OF COMPANIES WHICH HAVE CEASED TO BE ITS SUBSIDIARIES JOINTVENTURES OR ASSOCIATE COMPANIES DURING THE YEAR
DISCLOSURE UNDER THE SEXUAL HARRASSMENT OF WOMEN AT WORKPLACE(PREVENTION PROHIBITION AND REDRESSAL) ACT 2013
The Company has in place Internal Complaints Committee for theRegistered Office Tea Division and Textile Division. The following is the summary ofSexual Harassment complaints received and disposed off during the year 2020-21:
No. of Complaints pending as on 1st April 2020: NIL
No. of Complaints received : NIL
No. of Complaints Disposed off : NIL
The Directors place on record their sincere appreciation for theassistance and co-operation extended by Banks its employees its investors and all otherassociates and look forward to continue fruitful association with all business partners ofthe Company.