Choksi Imaging Limited
Your Directors have pleasure in presenting the 26th Annual Report of the Companytogether with the Audited
Statements of Accounts for the year ended 31st March 2018.
FINANCIAL STATEMENTS & RESULTS:
The Company's performance during the year ended 31 March 2018 as compared to theprevious financial year is summarized below:
| || ||(Rs. in Lacs) |
|Particulars ||2017-2018 ||2016-2017 |
|Total Revenue ||2432.52 ||3090.79 |
|Profit/(Loss) Before Depreciation Amortisation Exceptional & Extraordinary Items and Tax ||204.97 ||137.74 |
|Less: Depreciation and Amortisation expense ||21.84 ||38.54 |
|Profit/(Loss) Before Exceptional & Extraordinary Items And Tax ||183.13 ||99.20 |
|Net Profit/(Loss) Before Tax (NPBT) ||183.13 ||99.20 |
|Less: Tax expenses ||54.58 ||22.41 |
|Net Profit/(Loss) After Tax (NPAT) ||128.55 ||76.79 |
|Net Comprehensive Income ||(0.32) ||(0.34) |
|Add: Surplus brought forward from previous year ||1041.79 ||965.34 |
|Amount available for Appropriations ||1170.02 ||1041.79 |
Note: Difference in amount for the year 2016-2017 is due to adoption of IND-AS.
The total long term borrowings of your Company as on 31 March 2018 stood at NIL Cashand Cash Equivalent stood at Rs. 830.74 lakh and total investments is Rs. 535.70 Lakh atthe end of the year.
Your Company is engaged in the business of manufacturing & trading of X ray filmsand supply of other products for the Healthcare Industry.
During the year under the review your Company earned a total income of Rs. 2432.52 asagainst Rs. 3090.79 during the previous year.
Your Directors pleased to recommend dividend of 7.5% i.e. Rs.0.75/- (Paise Seventy FiveOnly) per share on 3900000 fully paid-up
Equity Shares of `10/- each of the Company for the year ended March 31 2018. Theproposed dividend if approved at the Annual General Meeting will absorb a sum of Rs.29.25 lakh and Dividend Tax of Rs. 6.01 lakh.
The Company has not transfer any amount to General Reserves.
The paid up Equity Share Capital as at March 31 2018 stood at Rs. 390 lakh. During theyear under review the Company has not issued shares with differential voting rights norhas granted any stock options or sweat equity. As on March 31 2018 none of the Directorsof the Company hold instruments convertible into equity shares of the Company.
REVISION OF FINANCIAL STATEMENTS:
The Company has adopted Indian Accounting Standard for the year 2017-2018.
REPORT ON PERFORMANCE OF SUBSIDIARIES ASSOCIATES AND JOINTVENTURE COMPANIES
During the year under review your Company did not have any subsidiary associate andjoint venture company.
CORPORATE GOVERNANCE REPORT & MANAGEMENT DISCUSSION AND ANALYSIS:
As per Regulation 34 (3) read with Schedule V of the SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 a separate section on corporate governancepractices followed by the Company together with a certificate from the Company's Auditorsconfirming compliance forms an integral part of this Report.
A detailed report on Industry Structure and Developments operations performanceBusiness Outlook Opportunities & Threats and Risks and Concerns is presented in aseparate section forming a part of the Annual Report.
DIRECTORS AND KEY MANAGERIAL PERSONNEL:
Director Retiring by Rotation:
As per the provisions of Section 152 of the Companies Act 2013 Mr. Gaurav Choksi andMr. Naimish Choksi retires by rotation at the ensuing Annual General Meeting and beingeligible offer himself for re-appointment. Your Directors recommend his approval.
Appointment of Managing Director &Whole time Director:
The Nomination & Remuneration Committee and the Board have approved there-appointment of Mr. Anil Choksi as Managing Directorfor period of 1 year w.e.f 1stSeptember 2018 at a remuneration of Rs.600000/- (Rupees Six Lakh only) per annum i.e.Rs.50000/- (Rupees Fifty Thousand only) per month. Approval of the shareholders is soughtfor the same in this ensuing Annual General Meeting.
The Nomination & Remuneration Committee and the Board have approved there-appointment of Mr. Samir Choksi as Whole time Director for period of 3 years w.e.f 1stSeptember 2018 at a remuneration of Rs.600000/- (Rupees Six Lakh only) per annum i.e.Rs.50000/- (Rupees Fifty Thousand only) per month. Approval of the shareholders is soughtfor the same in this ensuing Annual General Meeting.
Appointment of Independent Directors and declaration of independence:
During the year The Company has not appointed any Independent Director.
The Company has received declarations from all the Independent Directors of the Companyconfirming that they meet with the criteria of independence as prescribed undersub-section (6) of Section 149 of the Companies Act 2013.
Appointment of Key Managerial Personnel:
No Key Managerial Person has been appointed or has retired or resigned during the year.
Pursuant to the provisions of the Companies Act 2013 and Regulation 17 of the ListingRegulation and SEBI Circular dated 13 February 2018 the committee update the criteria ofBoard evaluation.
The Board has carried out performance evaluation. The manner in which the evaluationhas been carried out has been explained in Corporate Governance Report.
The Company has adopted a Remuneration Policy for the Directors Key ManagerialPersonnel and other employees pursuant to the provisions of the Act and the ListingRegulations. The policy on Nomination & Remuneration of Directors and KMP is availableon website of the Company at www.choksiworld.com.
DIRECTOR'S RESPONSIBILITY STATEMENT
In terms of Section 134(5) of the Companies Act 2013 in relation to the auditedfinancial statements of the Company for the year ended 31 March 2018 the Board ofDirectors hereby confirms that:
(a) In the preparation of the annual accounts the applicable accounting standards hadbeen followed along with proper explanation relating to material departures;
(b) the directors had selected such accounting policies and applied them consistentlyand made judgments 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 had 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 had prepared the annual accounts on a going concern basis; and
(e) The directors in the case of a listed company had laid down internal financialcontrols to be followed by the company and that such internal financial controls areadequate and were operating effectively.
(f) The directors had devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems were adequate and operating effectively.
DETAILS OF BOARD AND COMMITTEES MEETING:
Details of the Board meetings and attendance of the directors are provided in theCorporate Governance Report which forms part of this Annual Report.
Committees of the Board:
With a view to have a more focused attention on business and for better governance andaccountability the Board has constituted the mandatory committees viz. Audit CommitteeStakeholders' Relationship Committee and Nomination and Remuneration Committee
The details with respect to the compositions roles terms of reference etc. ofrelevant committees are provided in the Corporate Governance Report of the Company whichforms part of this Annual Report.
All contracts / arrangements / transactions entered by the Company during the financialyear with related parties are given in Annexure I in form AOC-2.
Further during the year the Company had not entered into any contract / arrangement/transaction with related parties which could be considered material in accordance withthe policy of the Company on materiality of related party transactions. Prior omnibusapproval of the Audit Committee is obtained for the transactions which are repetitive innature. A statement of all Related Party Transactions is placed before the Audit Committeefor its review on a quarterly basis specifying the nature value and terms and conditionsof the transactions.
The details of the related party transactions as required under Accounting Standard areset out in Noteto the financial statements forming part of this Annual Report.
The Policy on Related Party Transactions as approved by the Board has been uploaded onthe website of the Company.
Your Company has not accepted any public deposits during the financial period underreview.
Pursuant to the provisions of Section 139 of the Companies Act 2013 and the Companies(Audit and Auditors) Rules 2014 M/s. KARIA & SHAH Chartered Accountants has beenappointed by the Board of Directors as Statutory Auditors of the Company from conclusionof 25th Annual General Meeting held on 23rd September 2017 till conclusion of 30th AnnualGeneral Meeting. The Company has received a confirmation from the Auditors that they arenot disqualified to act as the Auditors and are eligible to hold the office as Auditors ofthe Company.
Provisions of Section 204 read with rules made thereunder Ms. Nikita Pedhdiya NikitaPedhdiya & Associates Practicing Company Secretaries (C.P No. 14295) had beenappointed to undertake Secretarial Audit of the Company for the year 2017-2018. The reportof the Secretarial Auditor is annexed herewith as Annexure II and forms part of thisReport.
The said report does not contain any observation or qualification requiring explanationor comments from the Board under Section 134(3) of the Companies Act 2013.
Pursuant to provisions of Section 138 read with read with rules made thereunder theBoard has appointed Ms. Sheetal Khoja Chartered Accountants as an Internal Auditors ofthe Company for the period 2017-2018 to check the internal controls and functioning of theactivities and recommend ways of improvement. The Internal Audit is carried out halfyearly basis the report is placed in the Audit Committee Meeting and the Board Meetingfor their consideration and direction.
The Internal Financial Controls with reference to financial statements as designed andimplemented by the Company are adequate. During the year under review no material orserious observation has been received from the Internal Auditors of the Company forinefficiency or inadequacy of such controls.
In the opinion of the Directors the notes to financial statements are self-explanatoryand adequately explain the matters which are dealt within the Auditors' Report.
The said report does not contain any observation or qualification requiring explanationor comments.
Provisions of Section 148 of the Companies Act 2013 read with Notifications/Circularsissued by the Ministry of Corporate
Affairs from time to time the requirement of appointment of Cost Auditor is notapplicable to your Company.
INTERNAL CONTROL & FINANCIAL REPORTING SYSTEMS
The Company has in place an adequate system of internal controls & policy onclosure of Financial Statements. It has documented policies and procedures covering allfinancial and operating functions and processes. These have been designed to provide areasonable assurance with regard to maintaining of proper accounting controls for ensuringreliability of financial reporting monitoring of operations protecting assets fromunauthorized use or losses and compliance with regulations.
Adequate internal control systems commensurate with the nature of the Company'sbusiness and size and complexity of its operations has been recognized. Internal controlsystems ensure reliability of financial reporting timely feedback on achievement ofoperational and strategic goals compliance with applicable laws and regulations and thatall assets and resources are acquired economically used efficiently and adequatelyprotected.
In accordance with Section 134 of Companies Act 2013 the Company has in place theRisk Assessment and Minimization Policy to avoid events situations or circumstances whichmay lead to negative consequences on the Company's businesses and define a structuredapproach to manage uncertainty and to make use of these in their decision makingpertaining to all business divisions and corporate functions. Key business risks and theirmitigation are considered in the business plans and in periodic management reviews.
The Constitution of Risk Management Committee is not applicable to your Company.
Some of the risks and threats that the company is exposed to are-
The company strongly believes that technological obsolescence is a practical reality.Technological obsolescence is evaluated on a continual basis. The use of technology ismainly concentrated in the area of manufacturing of Medical and Industrial X-ray films.The innovation and advancement in technology is concentrated on improving the quality ofthe films increasing the output by reducing the time-lag involved and reducing thewastages.
FLUCTUATIONS IN FOREIGN EXCHANGE
While our functional currency is the Indian rupee we transact a non-significantportion of our business in USD & Euro accordingly face foreign currency exposure fromour purchase in other countries and from our purchases from overseas suppliers in U.S.dollars and other currencies and are exposed to substantial risk on account of adversecurrency movements in global foreign exchange markets.
Legal risk is the risk in which the Company is exposed to legal action. As the Companyis governed by various laws and the Company has to do its business within four walls oflaw where the Company is exposed to legal risk exposure.
The Company regards its human resource as amongst its most valuable assets andproactively reviews policies and processes by creating a work environment that encouragesinitiative provides challenges and opportunities and recognizes the performance andpotentials of its employees.
At CIL there is consistent emphasis on each individual's sense of responsibilitywhile simultaneously as part of a team. This results in our people's ability to work inperfect harmony despite coming from different disciplines. As of 31st March 2018 thenumber of employees on our payroll was 62.
CONSERVATION OF ENERGYTECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO
(A) Conservation of energy-
(i) The steps taken or impact on conservation of energy;
The company had replaced Voltas Air Condition Plant which was having rotary compressorswith Bluestar Scroll compressor based plant. This has resulted in 25% saving in energyconsumption.
(ii) The steps taken by the company for utilising alternate sources of energy; None
(iii) The capital investment on energy conservation equipments;
During the year there is no capital investment on energy conservation equipments.
(B) Technology absorption-
(i) the efforts made towards technology absorption; The interleaving operation has beenpartially automated.
(ii) the benefits derived in product improvement cost reduction productdevelopment or import substitution;
Improvement in product quality and reduction in production cost.
(iii) in case of imported technology (imported during the last three years reckonedfrom the beginning of the financial year) -
(iv) the expenditure incurred on Research and Development.
FOREIGN EXCHANGE EARNINGS AND OUTGO
The Forex market conditions were volatile during the year gone by. The fluctuations inthe market were high due to depreciation of rupee against the dollar. But your Company wasable to manage the volatility in a prudent manner due to which losses were minimized.
|Sr. No ||Particulars ||Current Year (Rs. in lakh) ||Previous year (Rs. in lakh) |
|1 ||Foreign Exchange Earnings ||Nil ||Nil |
|2 ||Foreign Exchange Outgo ||5.39 ||24.66 |
PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES
The information required under Section 197 of the Companies Act 2013 read withCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014 in respect ofemployees of the Company is provided in Annexure III forming part of this report.
DISCLOSURES AS PER RULE 5 OF COMPANIES (APPOINTMENT & REMUNERATION) RULES 2014.
The ratio of the remuneration of each Director to the median remuneration of theemployees of the Company for the financial year under review has been marked as AnnexureIII.
WHISTLE BLOWER POLICY /VIGIL MECHANISM POLICY.
The Company has adopted a Whistle Blower Policy to provide a formal mechanism to theDirectors and employees to report their concerns about unethical behaviour actual orsuspected fraud or violation of the Company's Code of Conduct or ethics policy. The Policyprovides for adequate safeguards against victimization of employees who avail of themechanism and also provides for direct access to the Chairman of the Audit Committee. Itis affirmed that no personnel of the Company has been denied access to the AuditCommittee.
SEXUAL HARRASMENT POLICY
In accordance with the Sexual Harassment of Women at Workplace (Prevention Prohibitionand Redressal) Act 2013 and rules made thereunder the Company has framed and adopted thea policy for Prevention of Sexual Harassment at Workplace.
The Company has not received any complaint of sexual harassment during the financialyear 2017-18.
CORPORATE SOCIAL RESPONSIBILITY
The Provisions of Section 135 of Companies Act 2013 is not applicable to your Company.
EXTRACT OF ANNUAL RETURN.
Extract of the Annual Return in form MGT-9 pursuant to Section 92(3) of the CompaniesAct 2013 for the financial year ended 31 March 2018 is provided in Annexure IV formingpart of this report.
PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS BY COMPANY.
The Company has made an investment during the year of Rs.535.70 lac which includes SBISavings Fund - Balance Units 865162.344 NAV 26.9608 as on 31.03.18 Having averagepurchase cost 26.778 per unit Reliance Liquid Funds - Treasury - Balance Units 7163.175NAV 4222.2458 as on 31.03.18 Having average purchase cost 4188.086 per unit as on 31stMarch 2018.
The Company has not given any loans or provided any security during the year.
No material changes and commitments which could affect the Company's financial positionhave occurred between the end of the financial year of the Company and date of thisreport.
The Company is in receipt of order from Commissioner of Customs from the Authority forpayment of Special Additional Duty along with penalty against exemption availed by theCompany pursuant to Notification No. 45/2005 - Customs dated May 16 2005.
The Company has filed an appeal against order with Customs Excise & Service TaxAppellate Tribunal west zonal bench Mumbai on 25.06.2015. The company is awaiting forthe case to be placed before the Authority for hearing.
HEALTH AND SAFETY MEASURES
The standards of health of workers and safety measures to be taken as provided by theFactories Act 1948 and the rules framed there under have been maintained by your Company.
Statements in this Board's Report and Management Discussion and Analysis describing theCompany's objectives expectations or predictions may be forward looking within themeaning of applicable securities laws and regulations. Actual results may differmaterially from those expressed in the statement. Important factors that could influencethe Company's operations include change in government regulations tax laws economic& political developments within and outside the country and such other factors.
ACKNOWLEDGEMENTS AND APPRECIATION
Your Directors wish to thank all the employees of the Company for their dedicatedservice during the year. They would also like to place on record their appreciation forthe continued co-operation and support received by the Company during the year frombankers financial institutions business partners and other stakeholders.
Your Directors give their warm gratitude to the shareholders for their faith in theCompany. The directors also sincerely appreciate the professionalism and dedicationdisplayed by the employees of the Company.
| ||On behalf of the Board of Directors |
| ||Sd/- ||Sd/- |
|Date: 21 July 2018 ||Anil Choksi ||Gaurav Choksi |
|Place: Mumbai ||Director ||Director |
Form No. AOC-2
(Pursuant to clause (h) of sub-section (3)of section 134 of the Act and Rule 8(2) ofthe Companies Accounts) Rules 2014)
Form for disclosure of particulars of contracts/arrangements entered into by thecompany with related parties referred to in sub-section (1) of section 188 of theCompanies Act 2013 including certain arms length transactions under third proviso thereto
1. Details of contracts or arrangements or transactions not at arm's length basis
|Name(s) of the related party and nature of relationship ||Hi-tech Imaging Private Limited ||Choksi Brothers Private Limited ||M/s. Unique Imaging |
|Nature of contracts/arrangements/transactions ||Sale of Materials & Service ||Payment of Rent ||Purchase of Material |
|Duration of the contracts / arrangements/transactions ||1 year ||1 year ||1 year |
|Salient terms of the contracts or arrangements or transactions including the value if any ||N.A. ||N.A. ||N.A. |
|Justification for entering into such contracts or arrangements or transactions ||The transaction is done in regular course of Business. ||The location of property meets requirement of Company. ||The transaction is done in regular course of Business. |
|Date(s) of approval by the Board ||26.05.2018 ||26.05.2018 ||26.05.2018 |
|Amount paid as advances if any ||N.A. ||N.A. ||N.A. |
|Date on which the special resolution was passed in general meeting as required under first proviso to section 188 ||N.A. ||N.A. ||N.A. |
2. Details of material contracts or arrangement or transactions at arm's length basisThe Company does not enter into any material related party transaction.
SECRETARIAL AUDIT REPORT
Choksi Imaging Limited
My report of even date is to be read along with this letter.
(1) Maintenance of Secretarial record is the responsibility of the management of theCompany. My responsibility is to express an opinion on these secretarial records based onmy audit.
(2) I have followed the audit practices and processes as were appropriate to obtainreasonable assurance about the correctness of the contents of the secretarial records. Theverification was done on test basis to ensure that correct facts are reflected insecretarial records. I believe that the processes and practices I followed provide areasonable basis for my opinion.
(3) I have not verified the correctness and appropriate of financial records and Booksof Accounts of the company.
(4) Wherever required I have obtained the Management representation about thecompliance of laws rules and regulations and happening of events etc.
(5) The compliance of the provisions of Corporate and other applicable laws rulesregulations standard is the responsibility of management. My examination was limited tothe verification of procedures on test basis.
(6) The Secretarial Audit report is neither an assurance as to the future viability ofthe company nor the efficacy or effectiveness with which the management has conducted theaffairs of the company.
For Nikita Pedhdiya & Associates
Date: 26th May 2018
DISCLOSURE FOR RATIO OF REMUNERATION OF EACH DIRECTOR TO THE MEDIAN EMPLOYEE'SREMUNERATION AND OTHER DETAILS AS PER RULE 5 OF THE COMPANIES (APPOINTMENT &REMUNERATION) RULES 2014
(a) The ratio of the remuneration of each director to the median remuneration of theemployees of the company for the financial year:
|Executive Directors ||Ratio |
|Anil Choksi ||10:3 |
|Naimish Choksi ||10:3 |
|Samir Choksi ||10:3 |
|Gaurav Choksi ||10:3 |
Note: The calculation of Ratio is based on the latest remuneration drawn by ExecutiveDirectors. All Executive Director Including President marketing and President admin haswaive off their remuneration w.e.f 1 September 2017.
(b) The percentage increase in remuneration of each Director Chief FinancialOfficer Chief Executive Officer Company Secretary or Manager if any in the financialyear. CEO: NIL CFO: NIL CS: NIL.
(c) The percentage increase in the median remuneration of employees in the financialyear: 5.63%.
(d) The number of permanent employees on the rolls of the Company: 62 Employees ason March 31 2018.
(e) Explanation on the relationship between average increase in remuneration and theCompany's performance: The increase in remuneration depends on company's performanceand individual contribution.
(f) Comparison of the remuneration of the Key Managerial Personnel against theperformance of the Company:
The remuneration of Managing Director & Whole time Director as per cent of Revenuefrom operation and profit before tax is 0.02% & 0.32% respectively.
The remuneration of Company Secretary as per cent of Revenue from operation and profitbefore tax is 0.01% & 0.25% respectively.
(g) Variations in the market capitalization of the Company price earnings ratio asat the closing date of the current financial year and previous financial year andpercentage increase over decrease in the market quotations of the shares of the Company incomparison to the rate at which the Company came out with the last public offer in case oflisted companies and in case of unlisted companies the variations in the net worth ofthe Company as at the close of the current financial year and previous financial year:
|Particulars ||As at March 31 2018 ||As at March 31 2017 ||Variation |
|Closing rate of shares at BSE ||34 ||29 ||17.24 |
|EPS ||3.29 ||1.97 ||67.85 |
|Market Capitalisation (`Lac) ||1326 ||1131 ||17.24 |
|Price Earnings Ratio ||10.33 ||14.79 ||30.15 |
|Percentage Increase/decrease of market quotations of the shares of the Company in comparison to the rate at which the Company came out with last Public offer. ||240% ||190% ||26.31 |
(h) Average percentile increase already made in the salaries of employees other thanthe managerial personnel in the last financial year and its comparison with the percentileincrease in the managerial remuneration and justification thereof and point out if thereare any exceptional circumstances for increase in the managerial remuneration: Theaverage increase in salaries of employees other than managerial personnel in the financialyear 2017-18 was 7.2%and there was no increase in the percentage of managerialremuneration for the year 2017-18.
(I) The key parameters for variable component of remuneration availed by thedirectors are as follows:
There were no parameters for variable component of remuneration availed by thedirectors for the year 2017-18.
(j) The ratio of the remuneration of the highest paid director to that of theemployees who are not directors but receive remuneration in excess of the highest paiddirector during the year. N.A.
(k) Affirmation that the remuneration is as per the remuneration policy of theCompany: The Company affirms remuneration is as per the remuneration policy of theCompany.
STATEMENT PURSUANT TO RULE 5(2) OF COMPANIES (APPOINTMENT AND REMUNERATION OFMANAGERIAL PERSONNEL) RULES 2014
(a) List of employees of the Company employed throughout the financial year 2017-18and were paid remuneration not less than Rs.120 Lac per annum:
No employee receive remuneration more not less than Rs.120 lac per annum.
(b) Whether any such employee is a relative of any Director or Manager of theCompany and if so name of such Director or Manager: N.A.