TO THE MEMBERS OF CHARMS INDUSTRIES LIMITED
The Directors are pleased to present this 28th Annual Report and the Audited Statementof Accounts for the year ended March 31 2020.
1. FINANCIAL RESULTS
|Particulars ||For the year ended March 31 2020 (Rs in lakh) ||For the year ended March 31 2019 (Rs in lakh) |
|Total Income including exceptional items ||515.64 ||561.98 |
|Profit / (Loss) Before Depreciation ||(9.47) ||(5.11) |
|Less : Depreciation ||0.37 ||0.33 |
|Profit / (Loss) Befor Tax ||(9.80) ||(5.44) |
|Less : Income Tax ||- ||- |
|Less : Deferred Tax ||(0.04) ||(0.06) |
|Profit / (Loss) After Tax ||( 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.
Your Director feel that it is prudent to plough back the profits of the Company forfuture growth of the Company and therefore do not recommend any dividend for the yearended March 31 2020.
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.
The Company has not transferred any amount to Reserves.
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 ||No. of Board |
| || || ||Meeting held ||Meeting Attended |
|Shivkumar R. Chauhan ||Managing Director ||Promoter Executive ||5 ||5 |
|Harsad Shantilal Gandhi ||Chairman & Director ||Independent ||5 ||5 |
|Parth Shivkumar Chauhan ||Director ||Promoter Non- Executive ||5 ||5 |
|Nishit Madhavbhai Rupapara ||Director ||Independent ||5 ||5 |
|Nehal Shivkumar Chauhan ||Director ||Promoter Non- Executive ||5 ||5 |
B. Retirement by rotation:
In accordance with the provisions of the Articles of Association of the Company andCompanies Act 2013 Mr. Parth Shivkumar Chauhan (DIN- 07571829) retires by rotation andbeing eligible have offered himself for reappointment.
C. Changes in Board during the Year
There are no Changes in Board during the year.
D. 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 relevantDirector. The Nomination and Remuneration Committee of the Board continuously evaluatesthe performance of the Board and provides feedback to the Chairman of the Board. Theindependent directors had a separate meeting without the presence of any non-independentdirectors and management and considered and evaluated the Board's performance performanceof the Chairman and other non-independent directors and shared their views with theChairman. The Board had also separately evaluated the performance of the Committees andindependent directors without participation of the relevant 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 Five (5) times on 8th May 2019 28th May 2019 12thAugust2019 13th November2019 13th February2020 in respect ofsaid meetings proper notices were given and proceedings were properly recorded and signedin 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 2020 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.
|NAME OF THE DIRECTORS ||CATEGORY OF DIRECTORSHIP ||Position || |
NUMBER OF MEETINGS
| || || ||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.
During the met Four (4) times on 28th May 2019 12th August2019 13th November 2019 and 13th February 2020. The necessaryquorum 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 attributes andindependence 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.
During the Year 1 (One) meeting of the committee was held on 08th May2019.
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 THEDIRECTORS ||CATEGORY OFDIRECTORSHIP ||Position |
|Mr. Harsad S.Gandhi ||Independent Non- Executive ||Chairman |
|Mr. Shivkumar R. Chauhan ||Promoter and Managing Director ||Member |
|Mr. Parth Shivkumar Chauhan ||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 2020 are NIL. Mr. Dileep Panchal is the Company Secretary andCompliance Officer of the Company for the above purpose.
The Committee duly met 01 (one) times on 13th February 2020.
12. INDEPENDENT DIRECTORS MEETING:
The Independent Directors of the Company met during the year on 13th February 2020without the attendance of non Independent Directors and members of the Board. TheIndependent
Directors reviewed the performance of the non-independent Directors and Board as whole.the performance of the Chairman taking into account the views of executive Directors andnon-executive Directors and assessed the quality quantity and timeline of flow ofinformation between company management and board.
a. Statutory Auditors:
The present Auditors of the Company M/s. Jigar Shah &Associates CharteredAccountants Ahmedabad (FRN.:128263W) Chartered Accountants were appointed as Auditorsfor a period of 5 year(s) at the 26th Annual General Meeting held on 28th September 2018to hold office till the conclusion of the 31st Annual General Meeting of the Company to beheld in the year 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 2019-20.
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 Gupta Company Secretaries had been appointedto issue Secretarial Audit Report for the Period ended on 31st March 2020.Secretarial Audit Report issued by Mr. Brajesh Gupta Company Secretary in Practice Forthe period ended on 31st March 2020. Secretarial Audit Report issued by Mr.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.
- 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 01st April 2019 to 07th May 2019.
The Board of Directors of the Company would like to inform you that due tonon-availability of proper suitable candidate the Company could not appoint a qualifiedCompany Secretary as Compliance officer and then after on such finding Mr. Dileep Panchalappointed as Company Secretary and Compliance officer of the company w.e.f. 08thmay 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 apositive confirmation from the promoters who are holding shares in physical form toinitiate 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 due to which Company is Suspended from Stock Exchange howeverthe Company has paid the listing fee as on date.
The Board of Directors of the Company would like to inform you that the Company haspaid the listing fee as on date. Further the Company is regular in complying the variousclauses and regulations of the Listing Agreement and LODR.
- 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) Regulation 2015.
- Non-Compliance of Regulation 31 of SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 for the quarter ended September 2019 i.e. the Company hasdelayed in uploading the Shareholding Pattern within prescribed time however the Companyhas uploaded the same.
The Board of Directors of the Company would like to inform you that due to inadvertenterror Company has delayed in uploading the Shareholding Pattern within prescribed time.However then after Company uploaded the same Shareholding Pattern.
Non-Compliance of Regulation 76 of SEBI (Depositories and Participants) Regulations2018 for the quarter ended September 2019 i.e. the Company has delayed in uploading theReconciliation Report within prescribed time however the Company has uploaded the same.
The Board of Directors of the Company would like to inform you that due to inadvertentthe company has delayed in uploading the Reconciliation Report within prescribed time. Andthen after knowledge of the same the Company has uploaded the same.
Non-Compliance of Regulation 74 (5) of SEBI (Depositories and Participants)Regulations 2018 for the quarter ended March 2019 i.e. the Company has delayed inuploading the Confirmation Certificate within prescribed time however the Company hasuploaded the same.
The Board of Directors of the Company would like to inform you that due to inadvertentthe Company has delayed in uploading the Confirmation Certificate within prescribed timeand then after the company uploaded the Confirmation Certificate.
14. COMPANY SECRETARY:
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 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 was evaluated and the domain knowledgethey bring. They also evaluated the manner in which the information flows between theBoard and the Management and the manner in which the board papers and other documents areprepared 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.
The Equity Shares of the Company are listed on Bombay Stock Exchange however thetrading in shares of the company is suspended due to non-payment of listing fees to theStock Exchange for the year 2019-20 further the Company is regular in compliances ofvarious clauses and regulations of the Listing Agreement and/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.
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 transactions with any related parties whichcould be considered material in accordance with the policy of the Company during the yearunder review. Hence the Company is not required to disclose details of the related partytransactions in Form AOC-2 pursuant to clause (h) of sub-section (3) of Section 134 of theAct 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 thecompany for utilizing alternate sources of energy: None iii. The capital investment onenergy conservation equipment's: Nil
B. Technology Absorption:
i. the efforts made towards technology absorption: None ii. The benefits derived likeproduct improvement cost reduction product development or 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:
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 ANY AFFECTING THE FINANCIAL POSITION OF THECOMPANY OCCURRED BETWEEN THE END OF THE FINANCIAL YEAR TO WHICH THISE FINANCIAL STATEMENTSRELATE 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.
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
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: 27/08/2020 || |