TO THE MEMBERS OF BHALCHANDRAM CLOTHING LIMITED
Your Company's Directors the take pleasure in presenting the 14th Director's Report along with Audited Financial Statements of your Company for the Financial Year ended 31st March 2019.
The financial performance of the Company for the year ended March 31 2019 is summarized below:
|Particulars||March 31 2019||March 31 2018|
|Less: Operating and Admin. Expenses||1108259||9576121|
|Profit/Loss Before Tax||2180614||(927893)|
|Tax adjustment of earlier years||0||0|
|Profit/(Loss) after Tax||1611712||(927893)|
|Earnings per share (Rs.) : Basic||2.88||(1.66)|
STATE OF COMPANY'S AFFAIRS
|i Segment-wise position of business and its operations||No there is no Segment-wise position of business and its operations|
|ii Change in status of the company||No|
|iii Key business developments||-|
|iv Change in the financial year||No Company follows the same Financial Year|
|v Capital expenditure programmes||-|
|vi Details and status of acquisition merger expansion modernization and diversification||Company has neither plan for Acquisition/Merger nor any of the activity done during the Financial Year 2018-19|
|vii Any other material event having an impact on the affairs of the company||-|
Results of Operations
During the year under review your Company has reported a total income of Rs.32.89 lakhs as compared to previous years proceeds of Rs.86.48. The Company has seen a considerable decline in sales as the Cotton textile Industry has had a general slow down in the market.
Owing to inadequacy of profit no Dividends are recommended for the year under review.
Transfer of amounts to Investor Education and Protection Fund
Your Company did not have any funds lying unpaid or unclaimed for a period of seven years. Therefore there were no funds which were required to be transferred to Investor Education and Protection Fund (IEPF).
Transfer to Reserves
Since the there is no dividend for the year under review transfer of funds to the reserves is not required.
Nature of Business and Changes therein
The Company is engaged in the business of trading of Cotton textiles and to specialize in the export of quality Cotton Yarns and fabrics. The Company covers a wide variety of Cotton
Yarns including carded & combed ring spun yarns of coarse & fine counts ply yarns special yarns and grey fabrics.
During the year under review there has been no change in the nature of business of the Company.
Management Discussion and Analysis Report
As per the provisions of the SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 the Management Discussion and Analysis of the financial condition and results of consolidated operations of the Company under review is annexed and forms an integral part of the Annual Report.
Subsidiary Companies Joint Ventures and Associate Company
The Company does not have any subsidiary Company Joint Venture or Associate Company and no such Company ceased to exist as per the provisions of Section 2(87) of the Companies Act 2013 as on 31st March 2019.
During the year under review your Company did not accept any deposits in terms of Section 73 of the Companies Act 2013 read with the Companies (Acceptance of Deposit) Rules 2014. No amounts were outstanding which were classified as `Deposits' under the applicable provisions of Companies Act 2013 as on the date of Balance Sheet and hence the requirement for furnishing of details of deposits which are not in compliance with the Chapter V of the Companies Act 2013 is not applicable.
Particulars of Contracts or Arrangements with Related Parties
The Section 188 of the Companies Act 2013 read with the Companies (Meetings of Board and its Powers) Rules 2014 specifies the requirement for approval of the Board and/or the Members as and when applicable in related party transactions in relation to contracts/arrangements.
During the year under review the Company has not entered into related party transactions as per the provisions of Section 188 of the Companies Act 2013. Transactions with the related parties consist off only unsecured loans accepted which are outside the purview of section 188 of the Act hence disclosure in Form AOC-2 is not required.
Particulars of Loans Guarantees and Investments
The Company has not provided any Loans Guarantees during the year.
Board of Directors and Key Managerial Personnel
As on the date of this report the Company's Board consists of the following Directors:
1. Mr. Prakash R. Bang
2. Mr. Mahesh M. Bhattad
3. Ms. Meghna V. Panchal
4. Mr. Ujwal R. Lahoti
5. Mr. Umesh R. Lahoti
6. Mr. Aadhitiya U. Lahoti
1. Appointments and Resignations.
Ms. Priyam Agarwal resigned from the post of Company Secretary with effect from 19th April 2019
2. by rotation and Re-appointments
Mr. Aadhitiya Ujwal Lahoti (DIN 01501504) Director retire by rotation at the forthcoming Annual General Meeting and being eligible offers himself for reappointment.
Committees of Board
The Board has 3 Committees: Audit Committee Stakeholder's Relationship Committee and Nomination and Remuneration Committee. A detailed note on the functions of the Board and Committee are provided hereunder. The Composition of the Committees are as follows:
1. Audit Committee
The Company has constituted the Audit committee (Audit Committee) as per the provisions of Section 177 of the Companies Act 2013
The Audit Committee comprises of the following members:
|Name of the Director||Designation in the Committee|
|Mr. Prakash R Bang (Independent Director)||Chairman|
|Mr. Mahesh M Bhattad (Independent Director)||Member|
|Mr. Umesh R Lahoti (Executive Director)||Member|
All the members are financially literate and have accounting / related financial management expertise.
The Audit Committee advises the Management on the areas where internal control system can be improved. The Company has appointed Mittal & Mittal. Chartered Accountants as Internal Auditors to review and report on the internal control system. The report of the internal auditors is reviewed by the Audit Committee. The Internal Auditors submits their recommendations for the Audit Committee and provides their road map for future action.
The Role function responsibility and constitution of the Audit Committee is in accordance to the provisions of Section 177 of the Companies Act 2013 and as per SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015.
The Audit Committee functions according to its Charter that defines its composition authority responsibilities and reporting functions. The terms of reference of the Audit Committee inter alia includes the following function:
To investigate any activity within its terms of reference.
To seek information from any employee
To obtain outside legal or other professional advice
To secure attendance of outsiders with relevant expertise if it considers necessary
Oversight of the Company's financial reporting process and the disclosure of its financial information to ensure that the financial information is correct sufficient and credible.
Recommending to the Board of Directors the appointment re-appointment and if required the replacement or removal of the statutory auditor and the fixation of audit fees.
Approval of payment to statutory auditors for any other services rendered by the statutory auditors
Reviewing with the management the annual financial statements before submission to the Board of Directors for approval with particular reference to:
a. Matters required to be included in the Directors' Responsibility Statement to be included in the Director's report in terms of clause (2AA) of section 217 of the Companies Act 1956.
b. Changes if any in accounting policies and practices and reasons for the same
c. Major accounting entries involving estimates based on the exercise of judgment by management.
d. Significant adjustments arising out of audit.
e. Compliance with listing and other legal requirements relating to financial statements.
f. Disclosure of any related party transactions.
g. Qualifications in the draft audit report.
Reviewing with the management the half-yearly financial statements before submission to the Board of Directors for approval.
Reviewing with the management the statement of uses / application of funds raised through an issue.
Reviewing with the management performance of statutory and internal auditors and adequacy of the internal control systems.
Reviewing the adequacy of internal audit function if any including the structure of the internal audit department staffing and seniority of the official heading the department reporting structure coverage and frequency of internal audit.
Discussion with internal auditors any significant findings and follow up there on.
Reviewing the findings of any internal investigations by the internal auditors into matters where there is suspected fraud or irregularity or a failure of internal control systems of a material nature and reporting the matter to the Board of Directors.
Discussion with statutory auditors before the audit commences about the nature and scope of audit as well as post-audit discussion to ascertain any area of concern.
To look into the reasons for substantial defaults in the payment to the depositors debenture holders shareholders (in case of non-payment of declared dividends) and creditors.
To review the functioning of the Whistle Blower mechanism in case the same is existing.
Approval of appointment of CFO (i.e. the whole-time Finance Director or any other person heading the finance function or discharging that function) after assessing the qualifications experience & background etc. of the candidate.
Carrying out any other function as mentioned in the terms of reference of the Audit Committee.
In addition to the above carry out such other functions/powers as may be delegated by the Board of Directors to the Committee from time to time.
2. Stakeholder's Relationship Committee
The Stakeholder's Relationship Committee comprises of the following members:
|Name of the Director||Designation in the Committee|
|Mr. Mahesh M Bhattad (Independent Director)||Chairman|
|Mr. Ujwal R Lahoti (Managing Director)||Member|
|Mr. Umesh R Lahoti (Executive Director)||Member|
The terms of reference of Shareholders / Investors Grievance Committee complies with requirements of as per SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 and as per the provisions of Section 178 of the Companies Act 2013. Mr. Mahesh R. Bhattad is the Chairman of Shareholders / Investors Grievance Committee.
The terms of reference of Stakeholders Relationship Committee inter alia includes the following:
Redressal of Shareholders' debenture holders' and other security holders' investors complaints including complaints related to transfer of shares;
Allotment of shares approval of transfer or transmission of shares debentures or any other securities;
Issue of duplicate certificates and new certificates on split/consolidation/renewal;
Non-receipt of declared dividends balance sheets of the Company; and
Carrying out any other function as prescribed in the Listing Regulations.
3. Nomination and Remuneration Committee:
The Nomination and Remuneration Committee comprises of the following:
|Name of the Director||Designation in the Committee|
|Ms. Meghna V Panchal (Independent Director)||Chairperson|
|Mr. Mahesh M Bhattad (Independent Director)||Member|
|Mr. Prakash R Bang (Independent Director)||Member|
In compliance with Section 178 of Companies Act 2013 and Regulation 19 of SEBI (Listing Obligation and Disclosure Requirement) Regulations the Board Constituted the Nomination and Remuneration Committee comprising of Three Non-Executive Independent Directors of the company with the following Roles and functions:
To lay down criteria and terms and conditions with regard to identifying persons who are qualified to become Directors (Executive and Non-Executive) and persons who may be appointed in Senior Management and Key Managerial positions to determine their remuneration.
To determine their remuneration based on the Company's sizefinancial position trends and practices on remuneration prevailing in peer companies.
To formulate criteria for evaluation and carry out evaluation of performance of directors as well as Key Managerial Independent Directors and Senior Management Personnel.
To provide them reward linked directly to their effort performance dedication and achievement relating to Company's operations.
To retain motivate and promote talent and to ensure long term sustainability of talented managerial personnel and create competitive advantage.
To ensure no violation by an employee of any applicable laws in India or overseas including
: i) The Securities Exchange Board of India (Insider Trading) Regulations 1992; ame or
ii) The Securities Exchange Board of India (Prohibition of Fraudulent and Unfair Trade Practices relating to the Securities Market) Regulation1995.
To formulate detailed terms and conditions of employee stock option schemes including details pertaining to quantum of options to be granted conditions for lapsing of vested options exercise period adjustments for corporate actions and procedure for cashless exercise and such other functions as are required to be performed by the Remuneration Committee under the Securities Exchange Board of India(Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines 1999 as amended (ESOP Guidelines) in particular those stated in Clause 5 of ESOP Guidelines; as and when required.
To devise a policy on Board Diversity.
To identifying persons who are qualified to become directors and may be appointed on senior management in accordance with the criteria laid down and recommend to the board their appointment and removal.
To develop a succession plan for the Board and to regularly review the plan.
Declaration by Independent Directors
Mr. Prakash R Bang Ms. Meghna V Panchal and Mr. Mahesh M Bhattad are the Independent Directors on the Board of the Company. The Company has received the declaration from all the Independent Directors confirming that they meet the criteria as set out in the provisions of Section 149(6) of the Companies Act 2013 and SEBI (Listing Obligations And Disclosure Requirements) Regulations 2015.
Vigil Mechanism/Whistle Blower
The Vigil Mechanism as envisaged in the Companies Act 2013 and the Rules prescribed is implemented through the Whistle Blower Policy to provide for adequate safeguards against victimization of persons who use such mechanism and make provision for direct access to the Chairman of Audit Committee. This vigil mechanism has been formulated with a view to provide a mechanism for Directors/ Employees of the Company to approach the Chief Ethics Officer of the Company or Chairman of the Audit Committee of the Company or Chairman of the Company or Corporate Governance Cell.
Company has made arrangements of vigil mechanism under which Company has formed some rules regulation & Code of Conducts. All these mechanisms are for proper & fluent working of the business activities. Following are the Objectives of Vigil Mechanism:
To encourage employees to bring ethical and legal violations they are aware of to an internal authority so that action can be taken immediately to resolve the problem
To minimize the organization's exposure to the damage that can occur when employees circumvent internal mechanisms
To let employees know the organization is serious about adherence to codes of conduct.
To support this Vigil Mechanism of the Company in full measure members are requested to send their opinion Suggestions or complaints on following address:
Add.: 307 Arun Chambers Tardeo Road Mumbai - 400034 E-mail Id: firstname.lastname@example.org
Directors' Responsibility Statement
Pursuant to sub-section (5) of Section 134 of the Companies Act 2013 and to the best of their knowledge and belief and according to the information and explanations obtained /received from the operating management your Directors make the following statement and confirm that-
(a) in the preparation of the annual accounts the applicable accounting standards had been followed along with proper explanation relating to material departures;
(b) the directors had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the company at the end of the financial year and of the profit and loss of the company for that period;
(c) the directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets 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 the Company and that such internal financial controls are adequate and were operating effectively; and
(f) the directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.
Auditors and Auditors' Report
Lahoti Navneet & Company Chartered Accountants (ICAI FRN: 116870W) Statutory Auditor of the Company who are currently the Statutory Auditor of the Company have expressed their willingness to be continue to act as Statutory Auditor of the Company.
As required under the provisions of the Section 139 of the Companies Act 2013 the Company has obtained written confirmation from M/s. Lahoti Navneet & Company Chartered Accountants if made would be in conformity with the limits specified in the Section. Your Directors propose and wish the ratification of their appointment for the benefit of the Company and request the Shareholders to approve the ratification of appointment of the Statutory Auditors and fix their remuneration.
In terms of the provisions relating to statutory auditors forming part of the Companies Amendment Act 2017 notified on May 7 2018 ratification of appointment of Statutory Auditors at every AGM is no more a legal requirement. Accordingly the notice convening the ensuing AGM does not carry any resolution on Ratification of the appointment of the Statutory Auditors.
The notes on accounts referred to the Auditor's Report are self explanatory and there has been no qualification/ remark made there under and therefore the same does not call for any further comments/explanation from the Directors.
Being the Statutory Auditors for the Financial Year 2018-19 M/s Lahoti Navneet & Company Chartered Accountants have audited the Books of Accounts of the company.
The observations made in the Auditors Report read together with relevant notes thereon are self explanatory and hence do not call for any further comments under Section 134 of the Companies Act 2013.
Reporting of Frauds by Auditors
For the Financial year 2018-19 the Statutory Auditor has not reported any instances of frauds committed in the Company by its Officers or Employees.
Credit Rating of Securities
Taking of Credit Rating from credit Rating Agency is not applicable on the Company.
Corporate Insolvency Resolution Process initiated under The Insolvency and Bankruptcy Code 2016 (IBC)
No such process initiated during the period under review under the Insolvency and Bankruptcy Code 2016 (IBC)
Failure to Implement any Corporate Action
All the corporate action taken during financial year 2018-19 and reporting for the same with the concerned department has been completed within specified time limit.
Pursuant to the provisions of Section 204 of the Companies Act 2013 and The Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 the Company has appointed Atul Kulkarni and Associates a Practicing Company Secretary to undertake the Secretarial Audit of the Company. The Report of the Secretarial Audit Report forms part of this report as Annexure-1.
Equity Shares with Differential Rights.
The Company has not issued any equity shares with differential rights / sweat equity shares/ employee stock options or not made any provision of its own shares by employees or by trustees for the benefit of employees during the financial year 2018-2019
The Company has not made any purchase or provision of its own shares by employees or by trustees for the benefit of employees during the financial year 2018-2019.
Disclosure of Remuneration paid to Director and Key managerial personal
The table containing the names and other particulars of employees in accordance with the provisions of Section 197(12) of the Companies Act 2013 read with Rule 5(1) of the
Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 is appended as Annexure-2 to the Board's report.
Significant and Material Orders
There are no significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and Company's operations in future.
Extracts of Annual Return
As per the provisions of Section 134(3)(a) of the Companies Act 2013 an extract of the annual return in the prescribed format in Form MGT-9 is annexed to this Board's Report as
Number of meetings of the board and audit committee
1. Board of Directors Meetings.
During the Financial Year 2018-19 the Company held 4 board meetings of the Board of Directors as per Section 173 of Companies Act 2013 which is summarized below. The provisions of Companies Act 2013 and listing agreement were adhered to while considering the time gap between two meetings.
|S No.||Date of Meeting||Board Strength||No. of Directors Present|
2. Meeting of Audit Committee.
Audit Committee Meetings were convened and held on 30/05/2018 13/08/2018 31/10/2018 and 14/02/2019.
3.Meeting of Stakeholders Committee.
Stakeholder Relationship Committee Meetings were convened and held on 30/05/2018 13/08/2018 31/10/2018 and 14/02/2019.
4.Meeting of Nomination & Remuneration Committee.
Nomination & Remuneration Committee Meetings was held on 31/10/2018.
Annual Evaluation of the Board
As per the provisions of the Companies Act 2013 the Board has carried out an annual performance evaluation of its own performance of its individual performance as well as of the Board as whole.
The Board has on the recommendation of the Nomination & Remuneration Committee framed a policy for selection and appointment of Directors Senior Management and their remuneration. The remuneration is decided after considering various factors such as qualification experience performance responsibilities shouldered industry standards as well as financial position of the Company.
Explanation or comments by the board on qualifications reservations or adverse remarks or disclaimer made
Auditors report read with notes to Financial Statements are self explanatory and do not call for any further comments.
The particulars as prescribed under sub-section (3)(m) of Section 134 of the Companies Act 2013 read with the Companies (Accounts) Rules 2014 as amended up-to-date are set out hereunder:
Energy Conservation Measures Technology Absorption and R & D Efforts and Foreign Exchange Earnings and Outgo
Your Company is not engaged in any manufacturing activity and thus its operations are not energy intensive. However adequate measures are always taken to ensure optimum utilization and maximum possible saving of energy. The Company has installed energy conservative equipment's like LED (Light Emitting Diode) lights instead of CFL (Compact Fluorescent Lamp).
The Company has maintained a technology friendly environment for its employees to work in. Your Company uses latest technology and equipment's. However since the Company is not engaged in any manufacturing the information in connection with technology absorption is NIL.
Foreign Exchange Earnings and Outgo:
During the period under review the Company has earned Foreign Exchange of Rs. 166851/- when compared to previous year earning of Rs. 8313008 /- There has been no outgo.
Code of conduct:-
Principles Practices and Values
Your Company is committed to the principles of effective corporate governance. We believe that adherence to these principles is essential to maintaining shareholder trust and securing long-term growth. We are of the opinion that growth governance empowerment transparency compliance are all equally relevant and applicable to businesses - not just to Government.
Thus the Corporate Governance practices of the Company provide transparency in disclosures of the Company's activities business plans operating results and future strategy.
Obligation of company under the sexual harassment of women at workplace (prevention prohibition and redressal) Act 2013
In order to prevent sexual harassment of women at work place a new act The Sexual Harassment of Women at Workplace (Prevention Prohibition and Redressal) Act 2013 has been notified on 9th December 2013. Under the said Act every company is required to set up an Internal Complaints Committee to look into complaints relating to sexual harassment at work place of any women employee.
Company has adopted a policy for prevention of Sexual Harassment of Women at workplace and has set up Committee for implementation of said policy. During the year Company has not received any complaint of harassment.
Internal Financial Control
The Board has adopted the policies and procedures for ensuring the orderly and efficient conduct of its business including adherence to the Company's policies the safeguarding of its assets the prevention and detection of frauds and errors the accuracy and completeness of the accounting records and the timely preparation of reliable financial disclosures.
Risk management is the identification assessment and prioritization of risks followed by coordinated and economical application of resources to minimize monitor and control the probability and/or impact of unfortunate events or to maximize the realization of opportunities. Risk management's objective is to assure uncertainty does not deflect the endeavor from the business goals. The Company is in the process of laying down procedures to inform the members of the Board about the risk assessment and minimization procedures.
Corporate Social Responsibility
The Corporate Social Responsibility criteria is not applicable to the Company.
Details of Significant and Material orders passed by the regulators or Courts or Tribunals impacting the going concern status and Company's operations in future
No significant and Material Orders passed by the Regulatory authority or Court of Tribunals impacting the going concern Status and Company's operation in future during the financial year ended 31st March 2019.
Business Responsibility Report
Business responsibly report is applicable to top five hundred listed companies based on market capitalization as on 31st March 2019 therefore business responsibility report is not applicable for this company.
The Company has complied with all the Secretarial Standards.
Report on Corporate Governance
As per the provisions of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 the Corporate Governance requirements are not applicable to the Company whose shares are listed on SME Exchange or ITP Platform therefore report on Corporate Governance is not applicable to your Company as it is listed on ITP Emerge Platform.
Your Directors wish to express their grateful appreciation for co-operation and support received from customers financial institutions Banks regulatory authorities customers vendors and members and the society at large.
Deep sense of appreciation is also recorded for the dedicated efforts and contribution of the employees at all levels as without their focus commitment and hard work the Company's consistent growth would not have been possible despite the challenging environment.
For and on behalf of the Board of Directors
|Ujwal R. Lahoti||Umesh R. Lahoti|
|(DIN 00360785)||(DIN: 00361216)|
Date: 19th August 2019