To the Members
The Directors are pleased to present their 37th Report along with the audited financialstatements of the Company for the year ended 31st March 2017.
The Company's financial performance for the year ended 31st March 2017 is summarizedbelow:
|Particulars ||2016-17 ||2015-16 |
|Operational Income ||- ||- |
|Other Income ||195400 ||1783674 |
|Total Revenue ||195400 ||1783674 |
|Profit / (Loss) before Tax ||(3920386) ||(7792966) |
|Profit / (Loss) after Tax ||(3920386) ||(7792966) |
|General Reserves ||(574694858) ||(570774472) |
During the year under review there were no operations. The lead Institution i.e. IDBILtd. and IFCI have filed a suit before the Debt Recovery Tribunal (DRT) madras and ICICIhave also filed a suit before the Debt Recovery Tribunal (DRT) Mumbai for recovery oftheir dues.
ICICI had also sued the company before the Mumbai high court and an official receiveras appointed by the court took over the possession of the suit securities on 14.08.1998.Mumbai high court transferred this case to DRT Mumbai. On request of ICICI DRT Mumbai hasappointed a private receiver in place of court receiver. As per direction of DRT MumbaiICICI /Receiver made an advertisement in the newspaper on 27.11.2002 for sale / disposalof assets of the company Viz. floating dry docks Machineries furniture and fixturesvehicles stores and spares etc. on as is where is basis and as is what is basis. Theseassets as intimated by DRT receiver have since been disposed off. The company had filed acounter claim on ICICI (Lead Bank) amounting to Rs. 210 cr.
Further pending decision in the matter of company's claim on ICICI (Lead Bank)amounting to Rs.210 crores on account of the institution company has suffered loss whichresulted in a total loss of company's most valuable assets which had a
value more than sufficient to meet the claims of all secured and/or unsecuredcreditors. By failing to carry out timely maintenance despite reminders from the CourtReceiver High Court Mumbai and others the financial institutions allowed dissipation andultimate destruction of the two dry docks and other imported & indigenous machineries.Therefore the cost of fixed assets (net of relevant revaluation reserve) less depreciationprovided till the date of disposal and value of inventories aggregating to Rs.48.81 croresas intimated by DRT Receiver has been deducted from secured loans. In view of above themanagement is of the considered opinion that no amount whatsoever is due and payable tothe Financial Institutions.
However in the financial year 2015-16 on 30th June 2015 Debt Recovery TribunalMumbai has allowed a claim of Rs. 188115054/- to ICICI Bank Ltd. with subsequent simpleinterest @12% per annum from 1.04.1997 till realization. The Counter Claim of the companyamounting to Rs. 210 Crores has been rejected by the DRT. Your Company has filed an appealagainst this order before Debt Recovery Appellate Tribunal Mumbai.
Further during the financial year 2016-17 DRT Chennai vide its order dated 03/01/2017allowed the claim of IDBI and IFCI amounting to Rs. 310348000/- and Rs. 216083000/-respectively totaling Rs. 526431000/- against which the company has filed a reviewpetition and the matter is sub-judice.
During the year under review there has been no change in the nature of business of theCompany. Further no material changes and commitments have occurred between the end of thefinancial year and the date of the report affecting the financial position of the Company.
Subsidiaries and Associates
Company doesn't have any Subsidiaries or Associates Company.
Pursuant to Regulation 24 of Securities and Exchange Board of India (ListingObligations and Disclosure Requirements) Regulations 2015 the Company is require toformulate a policy for determining material subsidiaries but the same Clause is notapplicable on Company as Company doesn't have any Subsidiary Company.
Management Discussion and Analysis
A separate chapter on Management Discussion and Analysis is given in this AnnualReport.
There is no operation in the company since long thus your directors are not able torecommend any dividend for the financial year 2016-17.
In the above disclosure General reserves are negative and equity has been eroded.
During the F.Y. 2016-17 your Company has not accepted any deposits within the meaningof Section 73 and 76 Companies Act 2013 read with the Companies (Acceptance of Deposits)Rules 2014 and as such no amount of principal or interest was outstanding as on date ofthe Balance Sheet.
Corporate Governance A separate report on Corporate Governance along with theGeneral Shareholders Information as prescribed under the Securities and Exchange Board ofIndia (Listing Obligations and Disclosure Requirements) Regulations 2015 is annexed as apart of the Annual Report along with the Auditor's Certificate on Corporate Governance.
Extract of Annual Return
The details forming part of the extract of the Annual Return in the Form MGT-9 inaccordance with Section 92(3) of the Companies Act 2013 read with the Companies(Management and Administration) Rules 2014 are set out herewith as "AnnexureA" to this report.
Particulars of loans guarantees or investments
The Net Worth of the Company is negative and company had not given any loans orguarantee or investment during the year under review under the provision of section 186 ofthe Companies Act 2013.
Meetings of the Board and Committees
The details in respect to the number of Board and Committees meetings of your Companyare set out in the Corporate Governance Report which forms part of this Report.
Pursuant to the provisions of section 177 of
Companies Act 2013 the Audit Committee of the Company consisting of two Directors -Mr. Aditya Tulshan as Chairman and Mr. Jagdish Prasad Chokhani as members. Mrs. LakshmiDevi Chokhani has been resigned and your company is looking for suitable candidate for theposition of Directorship.
Board of Directors of the Company has duly accepted the recommendations of AuditCommittee during financial year 2016-17.
The Company has established a Vigil Mechanism/ Whistle Blower Policy. The purpose ofthis mechanism is to provide a framework to report concerns about unethical behavioractual or suspected fraud or violation of the Company's code of conduct or ethics policyand provide adequate safeguards against victimization of the person availing thismechanism. This Policy has been appropriately communicated within the organization and iseffectively operational. The policy provides mechanism whereby whistle blower may sendprotected disclosures directly to the Chairman of Audit Committee or Ethics Officer.
Risk Management - As per the requirement of Regulation 17 of Securities andExchange Board of India (Listing Obligations and Disclosure Requirements) Regulations2015 the company laid down the procedures to inform Board members about the riskassessment and minimization procedures and the Board was responsible for framingimplementing and monitoring the risk management plan for the company. The Company hasdeveloped and implemented a Risk Management Policy to identify and mitigate key risks thatmay threaten the existence of the Company.
However it is to be noted that company's ship repairing business has been suspendedsince June 1998 and it has pending litigation with govt./ autonomous bodies and financialinstitution
Internal Financial Controls
Your Company has put in place adequate internal financial controls with reference tofinancial statements. Such system has been designed to provide for:
Adoption of accounting policies in line with applicable accounting standards.
Proper recording of transactions with internal checks and reporting mechanism.
Compliance with applicable statutes policies management policies andprocedures.
The management of your Company periodically reviews the financial performance againstthe approved plans across various parameters and takes necessary action wherevernecessary. However trading of the Company has been suspended since 1998 but the Companyhas to incur continuous expenses in the form of litigation and other miscellaneousexpenses.
FRAUD REPORTED BY AUDITOR
There was no fraud by the Company during the financial year 2016-17 which has beennoticed (or) reported during the course of our Audit by the Auditors under section 12 ofsection 143 of Companies Act 2013.
Declaration of Independence
Your Company has received declaration from all the Independent Directors confirmingthat they meet the criteria of Independence as prescribed under the provisions ofCompanies Act 2013 read with the Schedules and Rules made there under as well asRegulation 25 & 26 of the Securities and Exchange Board of India (Listing Obligationsand Disclosure Requirements) Regulations 2015
The details of the familiarization programme for the Independent Directors have beenuploaded on the website of the Company and may be accessed through the link: http://www.cilsd.in/
Details of Significant and material orders passed by the Regulators or Courts orTribunals impacting going concern status and Company's operation in future.
No significant and material order was passed by Regulators or Courts or Tribunalsduring the year under review impacting the going concern status of your Company.
Directors and Key Managerial Personnel Appointments
During the financial year 2016-17 no Directors were appointed in the Company.
In accordance with the provisions of Sections 149 152 and other applicable provisionsif any of the Companies Act 2013 read with Companies (Appointment and Qualification ofDirectors) Rules
2014 Mrs. Rekha Suresh Goenka Director is liable to retire by rotation at theforthcoming Annual General Meeting.
In terms of provisions of Section 203 of the Companies Act 2013 read with Companies(Appointment & Remuneration of Managerial Personnel) Rules 2014 the Board ofDirectors of the Company has in its meeting held on 28th June 2016 appointed Mr.Chellappa Sriniwasan as Chief Financial Officer and appointed Mr. Priyanshu Kandhway asCompany Secretary and Priyanshu Kandhway Company Secretary as Chief Financial Officer ofthe Company on 14th November 2016 and 16th May 2017 respectively.
During the financial year 2016-17 Ms. Himanshi Zaira Company Secretary who wasappointed on 1st March 2016 has resigned on 3rd September 2016 and Mr. Ram KumarTiwari Chief Financial Officer has resigned on 30th June 2016 and Mr. ChellappaSriniwasan who was appointed as Chief Financial Officer resigned on 3rd September 2016.
The Board places on record its appreciation for their valuable contribution duringtheir association with your Company
Directors' Responsibility Statement
Pursuant to Section 134(3)(c) the Directors hereby state and confirm that :
(a) in the preparation of the annual accounts the applicable accounting standards havebeen followed along with proper explanation relating to material departures;
(b) the Directors have selected such accounting policies and applied them consistentlyand made judgements and estimates that are reasonable and prudent so as to give a true andfair view of the state of affairs of the company at the end of the financial year and ofthe profit and loss of the company for that period;
(c) the Directors have taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of this Act for safeguarding theassets of the company and for preventing and detecting fraud and other irregularities;
(d) the Directors have prepared the annual accounts on a going concern basis; and
(e) the Directors have laid down internal financial controls to be followed by thecompany and that such internal financial controls are adequate and were operatingeffectively.
(f) the Directors have devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems were adequate and operating effectively.
Statement indicating the manner in which formal annual evaluation has been done
In terms of provisions of Companies Act 2013 and Regulation 17 Securities and ExchangeBoard of India (Listing Obligations and Disclosure Requirements) Regulations 2015 theBoard has carried out the annual evaluation of its own performance and that of itsDirectors individually. The evaluation criteria as laid down by the Nomination &Remuneration Committee included various aspects of the functioning of Board such ascomposition process & procedures including adequate & timely informationattendance delegation of responsibilities decision-making; roles & responsibilitiesincluding monitoring benchmarking feedback; stakeholder relationship and committees.
The performance of individual Directors including the Chairman was evaluated on variousparameters such as knowledge & experience interest of stakeholders time devoted etc.The evaluation process has been explained in the Corporate Governance Report of the AnnualReport. The evaluation of Independent Directors was based on aspects like participation in& contribution to the Board decisions knowledge & experience and judgment.
COMPANIES CEASED OR BECOME SUBSIDIARIES JOINT VENTURES OR ASSOCIATE DURING THE YEAR
No Company is either ceased or become subsidiaries joint ventures or associate Companyduring the financial year 2016-17.
PARTICULARS OF REMUNERATION
The information as required in accordance with Section 197(12) of the Companies Act2013 read with the Companies (Appointment & Remuneration of Managerial Personnel)Rules 2014. However as per the provision of Section 136 of the Companies Act 2013 theReport and the Accounts are being sent to all members of the Company.
No remuneration paid to any Director or Managing director of the company except by wayof sitting fees for the financial year 2016-17 due to the prevailing condition of theCompany. There are Key managerial Personnel (KMP) appointed in the Company during thefinancial year 2016-17 but only Company Secretary cum Chief Financial Officer is gettingremuneration who was appointed on 14th November 2016. Thus there is no relevance todisclose remuneration for making any comparison as per the requirement of the provision ofthe Act and Rules made there under.
Nomination and Remuneration Policy
The Nomination & Remuneration Policy as approved by the Board on the recommendationof the Nomination & Remuneration Committee is annexed with this Report as Annexure"B".
Corporate Social Responsibility
Since Company's Business not operating its business since June 1998 thus corporatesocial responsibility (CSR) provision is not applicable to the company.
Internal Complaints Committee (Anti-Sexual H arassment Policy)
During the period under review no complaints were received by the Internal ComplaintsCommittee established under the Policy for Prohibition Prevention and Redressal of SexualHarassment of Women at Workplace.
Related party transactions
There is no related party transaction in the company with any related party. TheCompany has formulated a policy on Related Party Transactions which is available on thewebsite of the Company and can be accessed through the mentioned link http://www . cilsd.in/CIL/Policy/Related%20Party%20Policy.pdf.
Conservation of Energy Technology Absorption and Foreign Exchange Earnings and Outgo
Information as required by Section 134 (3) (m) read with relevant rules of theCompanies Act 2013 is set out as under:
Conservation of Energy -
Pursuant to the direction of DRT Mumbai all the ship repairing assets of the Companysold off. There are no more ship repair operations. Therefore no measures to conserve theenergy are required to be undertaken.
Technology absorption adoption & innovation
N.A. (in view of above)
Foreign Exchange Earnings & outgo
|Particulars ||Current Year ||Previous Year |
| ||(2016-17) ||(2015-16) |
|Earnings ||Nil ||Nil |
|Outgo ||Nil ||Nil |
Auditor and Auditor's Report Statutory Auditors
M/s B.K. Shroff & Co. Chartered Accountants appointed as Statutory Auditors ofthe Company in the 36th Annual General Meeting of the Company to hold office tillconclusion of 39th AGM. As required under Regulation 33 of SEBI (LODR) 2015 the Auditorsalso confirmed that they hold a valid certificate issued by the Peer Review of theInstitute of Chartered Accountants of India.
However the Board discussed the qualifications raised by the Auditors in their Reportsand noted the same along with the explanations provided by the Management as annexed tothis Report. Board confirm that certain debit and credit balances are not confirmed andreconciled which may affect certain financial disclosure which is unavoidable due topending litigation with Govt./autonomous bodies and financial Institutions.
In accordance with the provisions of Section 204 of the Companies Act 2013 read withthe Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 Companyappointed Ms. Sapna Garg ACS Company Secretary in Practice and proprietor of M/S SapnaGarg & Associates. Company Secretaries to conduct the Secretarial Audit of yourCompany. The Secretarial Audit Report is annexed herewith as Annexure C' tothis Report. The Secretarial Audit Report does not contain any qualificationsreservations or adverse remark.
The Board hereby places on record its sincere appreciation for the continued assistanceand support extended to the Company by its collaborators customers bankers vendorsGovernment authorities and employees.
Your Directors acknowledge with gratitude the encouragement and support extended by ourvalued Shareholders.
On behalf of the Board Directors
Jagdish Prasad Chokhani
Place : New Delhi
Date : 26/08/2017