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Charms Industries Ltd.

BSE: 531327 Sector: Financials
NSE: N.A. ISIN Code: INE442C01012
BSE 00:00 | 09 Mar Charms Industries Ltd
NSE 05:30 | 01 Jan Charms Industries Ltd
OPEN 2.35
PREVIOUS CLOSE 2.35
VOLUME 300
52-Week high 2.43
52-Week low 2.17
P/E 235.00
Mkt Cap.(Rs cr) 1
Buy Price 2.35
Buy Qty 20.00
Sell Price 2.38
Sell Qty 2525.00
OPEN 2.35
CLOSE 2.35
VOLUME 300
52-Week high 2.43
52-Week low 2.17
P/E 235.00
Mkt Cap.(Rs cr) 1
Buy Price 2.35
Buy Qty 20.00
Sell Price 2.38
Sell Qty 2525.00

Charms Industries Ltd. (CHARMSINDUSTRIE) - Director Report

Company director report

TO THE MEMBERS OF CHARMS INDUSTRIES LIMITED

The Directors are pleased to present this 27th Annual Report and the Audited Statementof Accounts for the year ended March 31 2019.

1. FINANCIAL RESULTS

Particulars For the year ended March 31 2019 (Rs in lakh) For the year ended March 31 2018 (Rs in lakh)
Total Income including exceptional items 560.21 406.18
Profit / (Loss) Before Depreciation (5.11) (4.99)
Less : Depreciation 0.33 1.31
Profit / (Loss) Before Tax (5.44) (6.30)
Less : Income Tax - -
Less : Deferred Tax (0.06) -
Profit / (Loss) After Tax (5.38) (6.30)
Other Comprehensive Income Net of Tax
Total Comprehensive Income for the year (5.38) (6.30)

The Financial Statements of the Company are prepared in accordance with IndianAccounting Standards (IND AS) including the Rules notified under the relevant provisionsof the Companies Act 2013 form part of the Annual Report and Accounts.

2. DIVIDEND

In view to conserve the resource of the Company your Directors do not recommend anydividend for the year ended 31st March 2019.

3. TRANSFER OF UNCLAIMED DIVIDEND TO INVESTOR EDUCATION AND PROTECTION FUND:

Since there was no unpaid/unclaimed Dividend declared and paid last year theprovisions of Section 125 of the Companies Act 2013 do not apply.

4. Reserves

The Company has not transferred any amount to Reserves

5. PERFORMANCE

The Company continued its strides in its core business activities of Money Changing asan RBI Registered Authorized Dealer Category- II

6. SUBSIDIARY / ASSOCIATE / JOINT VENTURE COMPANIES

The Company does not have any Subsidiary/Associate/Joint venture Companies.

7. Change in Nature of Business

The Company is engaged in the business of Money Changer. There was no change in thenature of business activities of the Company during the year under review

8. DIRECTORS AND KEY MANAGERIAL PERSONNEL

The boards consist of adequate number of directors as per the Companies act 2013 SEBIRegulations and other applicable laws.

a. Composition of Board

Name of Directors Designation Category No. of Board Meeting held No. of Board Meeting Attended
Shivkumar Chauhan Managing Director Promoter Executive 6 6
Harsad Shantilal Gandhi Chairman & Director Independent 6 6
Parth Shivkumar Chauhan Director Promoter Non Executive 6 6
Nishit Madhavbhai Rupapara Director Independent 6 6
Nehal Shivkumar Chauhan Director Promoter Non Executive 6 6

b. Retirement by rotation:

In accordance with the provisions of the Articles of Association of the Company andCompanies Act 2013 Mrs. Nehal Shivkumar Chauhan (DIN- 02901331) retires by rotation andbeing eligible have offered herself for reappointment.

c. Declaration of Independence

Mr. Harsad S. Gandhi (DIN: 01056779) and Mr. Nishit Mr. Rupapara (DIN:02859031) are theexisting Independent Directors the Company and the Company has received declarations fromall the Independent Directors confirming that they meet the criteria of independence asprescribed under the provisions of the Companies Act 2013 read with the Schedules andRules issued there under as well as Regulation 16(1)(b) of Listing Regulations (includingany Statutory modification(s) or re-enactment(s) for the time being in force).

d. Evaluation of Board's Performance

Pursuant to provisions of the Companies Act and the Listing Regulations the Board hascarried out the annual performance evaluation of its own performance performance of theChairman the Committees and independent Directors without

Participation of the relevant Director. The Nomination and Remuneration Committee ofthe Board continuously evaluates the performance of the Board and provides feedback to theChairman of the Board. The independent directors had a separate meeting without thepresence of any non independent directors and management and considered and evaluated theBoard's performance performance of the Chairman and other non independent directors andshared their views with the Chairman. The Board had also separately evaluated theperformance of the Committees and independent directors without participation of therelevant director.

e. Number of Meetings of The Board

Regular meetings of the Board are held to discuss and decide on various businesspolicies strategies financial matters and other businesses. During the year the Boardduly met Six (6) times on 25th May2018 14th August2018 16thOctober 2018 01st November2018 11thFebruary2019 and 28th March2019in respect of said meetings proper notices were given and proceedings were properlyrecorded and signed in the Minute Book maintained for the purpose.

9. EXTRACT OF ANNUAL RETURN AS PER SECTION 92(3) OF COMPANIES ACT 2013

An extract of Annual Return as at 31st March 2019 pursuant to section 92(3) of theCompanies Act 2013 and forming part of this Report is attached as "Annexure 1"to this Report.

10. DIRECTORS' RESPONSIBILITY STATEMENT

Pursuant to Section 134(3) of the Companies Act 2013 your Directors confirm:

i) that in the preparation of the annual accounts the applicable accounting standardshad been followed

along with proper explanation relating to material departures if any;

ii) That the Directors had selected such accounting policies and applied themconsistently and made judgments 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;

iii) That the Directors 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 for preventing and detecting fraud and other irregularities;

iv) That the Directors had prepared the annual accounts on a going concern basis.

v) That 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

vi) The Directors had devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems were adequate and operating effectively;

11. DISCLOSURE OF VARIOUS COMMITTEES OF BOARD OF DIRECTORS

a. AUDIT COMMITTEE:

The Audit Committee of Directors was constituted pursuant to the provisions of Section177 of the Companies Act 2013. The composition of the Audit Committee is in conformitywith the provisions of the said section.

The details of composition of Audit Committee are as follows:

NAME OF THE CATEGORY OF DIRECTORSHIP Position

NUMBER OF MEETINGS

DIRECTORS HELD ATTENDED
Mr. Harsad S. Gandhi Independent and Non Executive Chairman 4 4
Mr. Nishit M.Rupapara Independent and Non Executive Member 4 4
Mr. Shivkumar R. Chauhan Promoter and Managing Director Member 4 4

Terms of reference: The broad terms of reference of the Audit Committee are as under:

-Reviewing of the Company's financial reporting process and the disclosure of itsfinancial information to ensure that the financial statement is correct sufficient andcredible.

- Recommending the appointment remuneration and terms of appointment of externalAuditor. Review and monitor the auditor's independence and performance and effectivenessof audit process.

- Approval or any subsequent modification of transactions of the company with relatedparties

- Scrutiny of inter-corporate loans and investments

- Valuation of undertakings or assets of the Company wherever it is necessary.

- Monitoring the end use of funds raised through public offers and related matters.

- Reviewing with management the Annual financial statements and half yearly andQuarterly financial results before submission to the Board.

- Reviewing periodically the adequacy of the internal control system.- Discussions withInternal Auditor on any significant findings and follow up there on

Meetings:

During the met Five (4) times on 25th May2018 14th August2018 01st November 2018 and 11th

February 2019. The necessary quorum was present at the Meetings.

b. NOMINATION AND REMUNERATION COMMITTEE:

The Nomination and Remuneration Committee of Directors was constituted pursuant to theprovisions of Section 178 of the Companies Act 2013. The composition of the Committee isin conformity with the provisions of the said section.

The details of composition of Nomination and Remuneration Committee are as follows:

NAME OF THE DIRECTORS CATEGORY OF DIRECTORSHIP Position
Mr. Harsad S. Gandhi Independent Non Executive Chairman
Mr. Nishit M. Rupapara Independent Non Executive Member
Mrs. Nehal S. Chauhan Promoter Non Executive Member

Terms of reference:

The broad terms of reference of the Nomination and Remuneration Committee are as under:

- Formulation of the criteria for determining the qualifications positive attributesand independence of Director;

- Devising a policy on Board diversity;

- Formulation of Remuneration policy;

- Review the structure size and composition of the Board;

- Identifying and selection of candidates for appointment as Directors;

- Identifying potential individuals for appointment as Key Managerial Personnel andSenior Management;

- Formulation of criteria for evaluation of Independent Directors and the Board.

Meetings:

During the Year 1 (one) meeting of the committee was held on 11th February 2019..

The Board has on the recommendation of Nomination and Remuneration Committee framed apolicy on director's appointment and remuneration of Directors including criteria fordetermining qualification positive attributes independence of directors and remunerationfor directors Key Managerial Personnel and other employees.

c. STAKEHOLDERS RELATIONSHIP COMMITTEE:

The details of composition of Stakeholders Relationship Committee are as follows:

NAME OF THE DIRECTORS CATEGORY OF DIRECTORSHIP Position
Mr. Harsad S. Gandhi Independent Non Executive Chairman
Mr. Shivkumar R. Chauhan Promoter and Managing Director Member
Mr. Parth Shivkumar Chahun Non Executive Member

Details of Investor's grievances/ Complaints:

The Company has not received any complaints during the year. The pending complaints ofthe Shareholders/Investors registered with SEBI at the end of the current financial yearended on 31st March 2018 are NIL.

Mr. Shivkumar R. Chauhan is the Compliance Officer of the Company for the abovepurpose.

Meetings:

The Committee duly met 01 (one) times on 11th February 2019.

12. INDEPENDENT DIRECTORS MEETING:

The Independent Directors of the Company met during the year on 11th February 2019without the attendance of non-Independent Directors and members of the Board. TheIndependent Directors reviewed the performance of the non-independent Directors and Boardas whole. the performance of the Chairman taking into account the views of executiveDirectors and non-executive Directors and assessed the quality quantity and timeline offlow of information between company management and board.

13. Auditors

a. Statutory Auditors:

The present Auditors of the Company M/s. Jigar Shah &Associates CharteredAccountants Ahmedabad (FRN.:128263W) Chartered

Accountants were appointed as Auditors for a period of 5 year(s) at the 26thAnnual General Meeting held on 28th September 2018 to hold office till theconclusion of the 31st Annual General Meeting of the Company to be held in theyear 2023.

In accordance with the Companies Amendment Act 2017 enforced on 7th May 2018 by theMinistry of Corporate Affairs the appointment of Statutory Auditors is not required to beratified at every Annual General Meeting.

b. Cost Auditor:

As the cost audit is not applicable to the Company therefore the Company has notappointed the Cost Auditor pursuant to Section 148 of the Companies Act 2013 read withthe Companies (Cost Records and Audit) Amendment Rules 2014.

c. Internal Auditor

The Board of Directors has on the recommendation of Audit Committee and pursuant tothe provision of Section 138 of the Companies Act 2013 in their meeting held on 11thFebruary 2019 has appointed Mr. Praful N. Shah & Co. Chartered Accountant as anInternal Auditor of the Company for the financial year 2018-19.

d. Secretarial Auditor:

Provisions of Section 204 read with Section 134(3) of the Companies Act 2013 mandatesto obtain Secretarial Audit Report from Practicing Company Secretary. Mr. Brajesh GuptaCompany Secretaries had been appointed to issue Secretarial Audit Report for the Periodended on 31st March 2019.Secretarial Audit Report issued by Mr. Brajesh GuptaCompany

For the period ended on 31st March 2019. Secretarial Audit Report issued byMr. Brajesh Gupta Company Secretaries in Form MR-3 attached and marked as Annexure"2" for the period under review forms part of this report. The said reportcontains observation or qualification certain observation and qualification which arementioned here in under.

- The Company has not complied with provision of section 203 of Companies Act 2013 asthere was no full time Company Secretary till the 15th October 2018.

The Board of Directors of your Company would like to explain on the said observationrelating to appointment of Company Secretary that the Board of your company was unable tofind suitable candidate for such post and on finding such person the Company appointedMrs. Rohini Abhishek Chauhan as Company Secretary and Compliance Officer of the Company on16th October 2018.

- Non-Compliance of regulation 6(1) SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 which stipulates that a listed entity shall appoint aqualified company secretary as the compliance officer however the company does notappoint the same for a period of 1st April 2018 to 15th October2018 and 20th February 2019 to 31st March 2019.

As explained herein above that due to non Appointment of full time Company Secretarythe Company could not appoint Company Secretary as Compliance officer and thereafter onappointment of Mrs. Rohini Abhishek Chauhan as Company Secretary w.e.f. 16thOctober 2018 appointed her as Compliance officer and on her resignation on 20thFebruary 2019 appointed Mr. Dileep Panchal as Co m pa ny Secretary and Complianceofficer on 08th May 2019.

- Non-Compliance of regulation of 31(2) of SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 i.e. hundred percent of shareholding of promoter(s) andpromoter group should be in Dematerialized form.

The Board noted the fact about Non-Dematerialization of only 0.48 % of the promoter'sholding and accordingly intimated to the concerned promoters.

The company has received a positive confirmation from the promoters who are holdingshares in physical form to initiate the process of converting their shares in demat form.

- Non-Compliance of regulation 14 of SEBI (Listing Obligation and DisclosureRequirements) Regulations 2015 i.e. every Listed Company shall pay Listing fee asapplicable to the recognized stock exchange in the manner as specified by SEBI or therecognized stock exchange.

The Board of Directors of the Company would like to inform you that the Company is inprocess of making payment of listing fee for the F.Y.2018-19 further the Company isregular in complying the various clauses and regulations of the Listing Agreement andLODR.

- Non-Compliance of the regulation 46(1)and 46(2) of SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 which stipulates that a listed entity shallmaintain a functional website containing the basis information about listed entityhowever the Company does not maintain its website.

The Board of Directors of the Company would like to inform you that due to inadvertenterror the Company failed to renew its website therefore the website was temporarynon-functional and the Company has renewed its domain name and updated it .

- Non-compliance of regulation 47 of (Listing Obligations and Disclosure Requirements)Regulations 2015 i.e. Advertisements in Newspapers.

The Board of Directors of the Company would like to inform you that due to inadvertentthe company fails to publish advertisements in newspaper as per Regulation 47 of SEBI(LODR) Regulation2015.

14. COMPANY SECRETARY:

- MRS. ROHINI ABHISHEK CHAUHAN

The Board of Directors During the year in their meetings held on 16th October 2018 hasAppointed Mrs. Rohini Abhishek Chauhan as whole time company secretary and ComplianceOfficer of the company

Mrs. Rohini Abhishek Chauhan has resigned from the post of Company Secretary &Compliance Officer of the Company and her resignation was approved by Mr. ShivkumarRaghunandan Chauhan Managing Director (DIN-00841729) on 20th February 2019.

- MR. DILEEP PANCHAL

The Board of Directors in their meetings held on Wednesday 08th May 2019 hasAppointed Mr. Dileep Panchal as whole time company secretary and Compliance Officer of thecompany.

15. ESTABLISHMENT OF VIGIL MECHANISM

The company has in place a vigil mechanism pursuant to which a Whistle Blower Policy isalso in vogue. Whistle Blower Policy covering all stakeholders including employees anddirectors of the company is hosted on companies' website

http://www.charmsindustries.in/ .

16. DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS ORTRIBUNALS IMPACTIN THE GOING CONCERN STATUS AND COMPANY'S OPERATION IN FUTURE

There were no significant and material orders passed by the regulators or courts ortribunals impacting the going concern status and company's operation in future.

17. RISK MANAGEMENT:

The Company does not have any Risk Management Policy or any statement concerningdevelopment and i m plementation of risk management policy of the company as the elementsof risk threatening the Company's existence is very minimal.

13. COMPANY SECRETARY:

- MRS. ROHINI ABHISHEK CHAUHAN

The Board of Directors During the year in their meetings held on 16thOctober 2018 has Appointed Mrs. Rohini Abhishek Chauhan as whole time company secretaryand Compliance Officer of the company Mrs. Rohini Abhishek Chauhan has resigned from thepost of Company Secretary & Compliance Officer of the Company and her resignation wasapproved by Mr. Shivkumar Raghunandan Chauhan Managing Director (DIN-00841729) on 20thFebruary 2019.

- MR. DILEEP PANCHAL

The Board of Directors in their meetings held on Wednesday 08th May 2019has Appointed Mr. Dileep Panchal as whole time company secretary and Compliance Officer ofthe company.

14. ESTABLISHMENT OF VIGIL MECHANISM

The company has in place a vigil mechanism pursuant to which a Whistle Blower Policy isalso in vogue. Whistle Blower Policy covering all stakeholders including employees anddirectors of the company is hosted on companies' website http://www.charmsindustries.in/ .

15. DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS ORTRIBUNALS IMPACTIN THE GOING CONCERN STATUS AND COMPANY'S OPERATION IN FUTURE

There were no significant and material orders passed by the regulators or courts ortribunals impacting the going concern status and company's operation in future.

16. RISK MANAGEMENT:

The Company does not have any Risk Management Policy or any statement concerningdevelopment and implementation of risk management policy of the company as the elements ofrisk threatening the Company's existence is very minimal.

17. CORPORATE GOVERNANCE:

As per Regulation 15(2) of SEBI (Listing Obligation and Disclosures requirement)Regulation 2015 Report on Corporate Governance is not applicable on the Company as theCompany is not having the paid up share capital exceeding Rs. 10 crores and Net worth isexceeding Rs. 25 crores.

18. CORPORATE SOCIAL RESPONSIBILITY (CSR):

The provision of section 135(1) of Companies Act 2013 i.e. Corporate SocialResponsibility is not applicable on the company. Therefore the company has not constitutedCSR committee.

19. STATEMENT OF FORMAL ANNUAL EVALUATION

Nomination and Remuneration Committee annually evaluates the performance of individualDirectors Committees and of the Board as a whole in accordance with the formal systemadopted by it. Further the Board also regularly in their meetings held for variouspurposes evaluates the performance of all the Directors committees and the Board as awhole. The Board considers the recommendation made by Nomination and RemunerationCommittee in regard to the evaluation of board members and also tries to discharge itsduties more effectively. Each Board member's contribution their participation wasevaluated and the domain knowledge they bring. They also evaluated the manner in which theinformation flows between the Board and the Management and the manner in which the boardpapers and other documents are prepared and furnished.

20. INTERNAL CONTROL SYSTEMS AND THEIR

ADEQUACY

The Company has an Internal Control System commensurate with the size scale andcomplexity of its operations. The scope of the Internal Audit function is defined in theInternal Audit Manual. The Internal Audit Department monitors and evaluates the efficacyand adequacy of internal control system in the Company its compliance with operatingsystems accounting procedures and policies of the Company. The Internal Audit alsoincludes both physical as well as online transaction audit. Based on the report ofinternal audit function process owners undertake corrective action in their respectiveareas and thereby strengthen the controls. Significant audit observations andrecommendations along with corrective actions thereon are presented to the Audit Committeeof the Board.

21. MANAGEMENT DISCUSSION AND ANALYSIS REPORT:

Management Discussion and Analysis Report as required under the Listing Agreement withstock exchanges is annexed as a separate Annexure "3" forming part of thisReport.

22. LISTING

The Equity Shares of the Company are listed on Bombay Stock Exchange. The company yetto pay annual listing fees to the Stock Exchange for the year 2019-20 further the Companyis regular in compliances of various clauses and regulations of the Listing Agreementand/or LODR.

23. PARTICULARS REGARDING EMPLOYEES:

The information required under Section 197 of the Companies Act 2013 read with rule5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014is provided in the Report and marked as Annexure- "4". No employee of theCompany of the Company was in receipt of the remuneration exceeding the limits prescribedin the rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel)Rules 2014.

24. DEPOSITS

During the year under review the Company has not accepted or renewed any depositswithin the meaning of Section 73 and 76 of the Companies Act 2013 read with the Companies(Acceptance deposits Rules) 2014. There was no deposit which remained unclaimed andunpaid at the end of the year.

25. PARTICULARS OF CONTRACTS OR ARRANGEMENTS MADE WITH RELATED PARTIES PURSUANT TOSECTION 188(1) OF THE COMPANIES ACT 2013:

There were no contracts or arrangements or r transactions with any related partieswhich could be considered material in accordance with the policy of the Co m p a n y d u ri ng the year under review. Hence the Company is not required to disclose details of therelated party transactions in Form AOC-2 pursuant to clause (h) of sub-section (3) ofSection 134 of the Act and Rule 8(2) of the Companies (Accounts) Rules 2014.

26. PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS MADE UNDER SECTION 186 OF THECOMPANIES ACT 2013:

The company has not made any loans guarantees or investments covered under theprovisions of section 186 of the Companies Act 2013 during the financial period underreview.

27. CONSERVATION OF ENERGY

TECHNOLOGY ABSORPTION FOREIGN EXCHANGE EARNINGS AND OUTGO:

a. Conservation Of Energy:

i. the steps taken or impact on conservation of energy : Nil

ii. the steps taken by the company for utilizing alternate sources of energy : None

iii. the capital investment on energy conservation equipments : Nil

b. Technology Absorption:

i. the efforts made towards technology absorption : None

ii. the benefits derived like product improvement cost reduction product developmentor import substitution : None

iii. in case of imported technology (imported during the last three years reckoned fromthe beginning of the financial year)

a) The details of technology imported: None

b) The year of import: N.A.

c) Whether the technology has been fully absorbed: N.A.

d) If not fully absorbed areas where absorption has not taken place and the reasonsthereof:

N.A.

iv. the expenditure incurred on Research and Development : Nil

c. FOREIGN EXCHANGE EARNING & OUTGO:

i) Foreign Exchange Earning: NIL

ii) Foreign Exchange Outgoing: NIL

28. MATERIAL CHANGES AND COMMITMENT IF ANYAFFECTING THE FINANCIAL POSITION OFTHECOMPANY OCCURRED BETWEEN THE END OF THEFINANCIAL YEAR TO WHICH THESE FINANCIALSTATEMENTS RELATE AND THE DATE OF THE REPORT:

No material changes and commitments affecting the financial position of the Companyoccurred between the end of the financial year to which these financial statements relateon the date of this report.

29. GENERAL:

a. Your Company has not issued any equity shares with differential rights as todividend voting or otherwise; and

b. Your Company does not have any ESOP scheme for its employees/Directors

30. ACKNOWLEDGEMENT

Your Directors place on record the valuable co- operation and assistance extended byReserve Bank of India Western Union Financial services Inc. Government AuthoritiesBankers lending Institutions suppliers and Customers during the year under review. YourDirectors also place on record their appreciation for the committed services of theexecutives and staff of the Company.

For and on behalf of the Board

Sd/-

Harsad Shantilal Gandhi

Chairman & Director

(DIN: 01056779)

Place: Ahmedabad

Date: 12th August 2019