Your Directors have pleasure in presenting herewith the 34th Annual Reporton the business of the Company together with the Financial Statements for the financialyear ended March 31 2019.
1. FINANCIAL HIGHLIGHTS
| || ||(Amount in Rs.) |
|PARTICULARS ||STANDALONE |
| ||31.03.2019 ||31.03.2018 |
|Total Revenue ||49402732 ||25310185 |
|Total Expenses ||50070494 ||24840025 |
|Profit/loss before Tax ||(667762) ||470160 |
|Tax Expense ||0 ||114383 |
|Deferred Tax ||(36059) ||130118 |
|Profit/loss after Tax ||(631703) ||225659 |
Despite putting the best of the efforts Board of Directors of the Company the Companycould not generate the distributable profits for the FY 2018-19 and hence no dividend isproposed.
3. CHANGES IN SHARE CAPITAL
There was no change in the share capital of the Company during the year under review.
No equity shares with differential rights as to dividend voting or otherwise wereissued during the year under review.
No shares (including sweat equity shares) were issued to the employees of the Companyunder any scheme.
4. CHANGE IN THE NATURE OF BUSINESS:
There is no change in the nature of business during the FY 2018-19.
5. MATERIAL CHANGES AND COMMITMENTS
There were no material changes and commitments affecting the financial position of theCompany occurred between the end of the financial year of the Company to which thefinancial statements relate and the date of the report.
6. TRANSFER TO RESERVES
No amount has been transferred to the general reserves during the year under review.Details of reserves and surplus are disclosed in Note No 13 of the financial statements.
The Company has neither accepted nor renewed any deposits from public as defined underthe provisions of Companies Act 2013 and Companies (Acceptance of Deposits) Rules 2014.
Your Company does not have any subsidiary as on 31.03.2019.
9. DETAILS OF COMPANIES WHICH HAVE BECOME OR CEASED TO BE ITS SUBSIDIARIES JOINTVENTURES OR ASSOCIATE COMPANIES DURING THE YEAR
During the Financial Year 2018-19 MIENT Hospitality LLC USA ceased to be thesubsidiary of the Company as it was dissolved on 20th March 2019. Your company does nothave any associates or joint ventures.
10.DETAILS OF DIRECTORS & KEY
In accordance with the provisions of Section 152 of the Companies Act 2013 Mr. RLVNKishore Siram (DIN: 08208141) Director of the Company is liable to retire by rotationbeing eligible offers himself for reappointment.
The following changes took place on the Board of the Company during the year underreview:
|S. No ||Name of the Director/KMP ||Type of Change ||Date |
|1. ||Mr. Vivek Kalyan (DIN:01719658) ||Resigned as Director ||22.08.2018 |
|2. ||Mr. R L V N Kishore Siram (DIN 08208141) ||Resigned as CFO ||23.08.2018 |
|3. || ||Appointed as CFO ||24.08.2018 |
| ||Mr. Srinivasa Rao Kakkera || || |
|4. ||Mr. R L V N Kishore Siram (DIN 08208141) ||Appointed as Additional Director ||27.08.2018 |
|5. ||Mr. Yerra Srinivas (DIN 07834798) ||Resigned as Director ||29.08.2018 |
|6. ||Mr. R L V N Kishore Siram (DIN 08208141) ||Appointed as Director ||24.09.2018 |
Subsequently the following changes took place on the Board of the Company:
|S. No ||Name of the Director/ KMP ||Type of Change ||Date of Change |
| || || || |
|1. ||Monica Shrikant Gehlot ||Resigned as Company Secretary ||15.06.2019 |
|2. ||Mandava Swathi ||Appointed as Company Secretary ||15.06.2019 |
|3. ||Maruthi Rao Badheay ||Appointed as CEO ||15.06.2019 |
11.DECLARATION BY INDEPENDENT DIRECTORS
The Company has received declarations from all the Independent Directors of the Companyconfirming that they meet the criteria of independence as prescribed under sub-section (6)of Section 149 of the Companies Act 2013 and the Securities and Exchange Board of India(Listing Obligations and Disclosure Requirements) Regulations 2015.
12.MEETING OF INDEPENDENT DIRECTORS
During the year under review the Independent Directors met on 14.02.2019 inter aliato discuss:
Evaluation of the performance of Non-Independent Directors and the Board of Directorsas a whole; Evaluation of the performance of the Chairman of the Company taking intoaccount the views of the Executive and Non-Executive Directors. Evaluation of the qualitycontent and timelines of flow of information between the Management and the Board that isnecessary for the Board to effectively and reasonably perform its duties.
All the Independent Directors were present at the Meeting.
During the year 7 (Seven) meetings of the Board of Directors were held as moreparticularly disclosed in the attached Report on Corporate Governance. The intervening gapbetween any two meetings was within the prescribed period. The number and dates ofmeetings held by the Board and its Committees attendance of Directors and details ofremuneration paid to them is given separately in Corporate Governance Report in terms ofSection 134(3)(b) of the Companies Act 2013.
The Board evaluated the effectiveness of its functioning and that of the Committees andof individual directors by seeking their inputs on various aspects of Board/CommitteeGovernance.
The aspects covered in the evaluation included the contribution to and monitoring ofcorporate governance practices participation in the long-term strategic planning and thefulfillment of Directors' obligations and fiduciary responsibilities including but notlimited to active participation at the Board and Committee meetings. The Chairman of theBoard had one-on-one meetings with the Independent Directors. These meetings were intendedto obtain Directors' inputs on effectiveness of Board/Committee processes. Further theIndependent Directors at their meeting reviewed the performance of Board Chairman of theBoard and of Non-Executive Directors.
15.COMMITTEES OF THE BOARD
The number of committees of the Board its compositions meetings etc. forms part ofthe Corporate Governance Report accompanied to this Annual Report.
M/s. S N Murthy & Co. Chartered Accountants (FRN: 002217S). Hydera-bad thestatutory auditors of the Company were originally appointed in the 27th annualgeneral meeting of the Company for a term of 1 year followed by another year in 28thannual general meeting of the Company. Thereafter M/s. S N Murthy & Co. CharteredAccountants (FRN: 002217S) were appointed as statutory auditors of the Company the 29thAGM for a period of 5 years commencing from the conclusion of 29th AnnualGeneral Meeting till the conclusion of 34th Annual General Meeting of theCompany in accordance with the provisions of section 139 of the Companies Act 2013 andtheir term as the Statutory Auditors are expiring in the ensuing AGM.
Further pursuant to Section 139 of the Companies Act 2013 read with the Companies(Audit and Auditors) Rules 2014 M/s. S N Murthy & Co. Chartered Accountants beingeligible offer themselves for re-appointment for a term of 3 (three) years in accordancewith the provisions of Sec. 139 of the Companies Act 2013 and the rules made there under.The Company has also received written consent from the Auditors and a confirmation to theeffect that their reappointment if made would be within the limits prescribed under theSection 141 of the Companies Act 2013 and the rules made there under. Accordingly theappointment of M/s. S N Murthy & Co. Chartered Accountants as the statutory auditorsof the Company is hereby placed before the shareholders for their approval.
The Auditors' Report for the FY 2018-19 does not contain any disqualifications. Notesto Accounts and Auditors remarks in their report are self-explanatory and do not call forany further comments. There were no frauds reported by the auditor in the Audit Report.
18.SECRETARIAL AUDIT REPORT
Sarada Putcha Practicing Company Secretary (C.P. No. 8735) has conducted thesecretarial audit of the Company for the financial year 2018-19 as required under Section204 of the Companies Act 2013 and rules made thereunder. The secretarial audit report forFY 2018-19 forms part of this Annual Report as Annexure I. The report does not contain anyqualifications/observations except for not giling of the Form IEPF with the Registrar ofCompanies.
Management response to sole observation made by the Secretarial Auditors:
The Company is in the process of obtaining the data from the HDFC Bank for filing therelevant IEPF form with the Registrar.
M/s P K Rao & Co. Chartered Accountants (FRN: 014554S) were appointed as InternalAuditors of the Company for the financial year 18-19.
Dissolution of MIENT Hospitality LLC (WOS): MIENT Hospitality LLC USA been dissolvedas on 20th March 2019.
21.CORPORATE SOCIAL RESPONSIBILITY
The provisions of Section 135 of the Companies Act 2013 in connection with corporatesocial responsibility are not applicable to the Company for the financial year underreview.
22.INTERNAL FINANCIAL CONTROLS
The Company has adequate internal financial controls which commensurate with the sizeof the business of the Company.
23.DIRECTORS RESPONSIBILITY STATEMENT
Pursuant to Section 134 (5) of the Companies Act 2013 Your Directors' confirm that:
i. in preparation of annual accounts for the financial year ended 31stMarch 2019 the applicable accounting standards have been followed along with properexplanation relating to material departures;
ii. the Directors have selected such accounting policies and applied them consistentlyand made judgments and estimates that are reasonable and prudent so as to give true andfair view of the state of affairs of the Company at the end of the financial year endedMarch 31 2019 and of the profit and loss of the Company for the year;
iii. the Directors have taken proper and sufficient care for their maintenance ofadequate accounting records in accordance with the provisions of the Companies Act forsafeguarding the assets of the Company and for preventing and detecting fraud and otherirregularities;
iv. the Directors had prepared the annual accounts on a going concern basis;.
v. the Directors had laid down internal financial controls to be followed by theCompany and that such internal financial controls are adequate and were operatingeffectively.
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.
The Board has on the recommendation of the Nomination and Remuneration Committeeframed a policy for selection and appointment of Directors and Senior Management personneland fix their remuneration. The Remuneration Policy is posted on the website of theCompany.
25.VIGIL MECHANISM / WHISTLE
A vigil mechanism for directors and employees to report genuine concerns has beenestablished. The vigil mechanism policy has been uploaded on the website of the Company.
26.RISK MANAGEMENT POLICY
The Risk Management is overseen by the Audit Committee of the Company on a continuousbasis. The Committee oversees Company's process and policies for determining risktolerance and review management's measurement and comparison of overall risk tolerance toestablished levels. There are no material risks which threaten the very existence of thecompany.
27.CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION FOREIGN EXCHANGE OUTGO
Information required under section 134(3)(m) of the Companies Act 2013 read with Rule8 of the Companies (Accounts) Rules 2014 is enclosed herewith as Annexure-II.
28.EXTRACT OF ANNUAL RETURN
The details forming part of the extract of the Annual Return in Form MGT-9 is annexedherewith as Annexure III.
The Boards Report along with annual return and other annexures are also uploaded at theinvestor section of the Company's website - www.colorchipsindia.com.
29.PARTICULARS OF EMPLOYEES
Pursuant to Rule 5(2) of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014 during the financial year no employee was in receipt ofremuneration of Rs. 1.02 Crore or more or where employed for part of the year was inreceipt of Rs. 8.5 Lakh or more a month.
Disclosure under Rule 5 of the Companies (Appointment & Remuneration of ManagerialPersonnel) Rules 2014 is enclosed as Annexure IV.
30.MANAGEMENT DISCUSSION AND ANALYSIS
Management Discussion and Analysis Report is enclosed as Annexure - V to this report.
31.PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS
Details of investment made by the Company are given in the Notes to the FinancialStatements.
During the year under review the Company has not granted any Loans or given guaranteescovered under Section 186 of the Companies Act 2013.
A separate report on Corporate Governance is provided together with a Certificate fromthe Statutory Auditors of the Company regarding compliance with the conditions ofCorporate Governance as stipulated in Regulations 17 to 27 clauses (b) to (i) of subregulation (2) of Regulation 46 and paragraphs C D and E of Schedule V of the Securitiesand Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations2015 is annexed to this Report.
33.RELATED PARTY TRANSACTIONS
There were no materially significant related party transactions with the Company'sPromoters Directors Management or their relatives which could have had a potentialconflict with the interests of the Company.
34.DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS ORTRIBUNALS IMPACTING THE GOING CONCERN STATUS AND THE COMPANY'S OPERATIONS IN FUTURE
No significant or material orders were passed by the Regulators or Courts or Tribunalswhich impact the going concern status and Company's operations in future.
Maintenance of cost records as specified by the Central Government under sub-section(1) of section 148 of the Companies Act 2013 is not applicable to the Company.
The Company has complied with all the applicable provisions of the secretarialstandards as applicable to the Company.
Your Company's shares are listed on the BSE Limited and the listing fees for FinancialYear 2019-20 is paid.
38.DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTIONPROHIBITION AND REDRESSAL) ACT 2013
The Company has in place an An-Sexual Harassment Policy in line with the requirementsof the Sexual Harassment of Women at the Workplace (Prevention Prohibition &Redressal) Act 2013. Internal Complaints Committee (ICC) has been set up to redresscomplaints received regarding sexual harassment. All employees (permanent contractualtemporary trainees) are covered under this policy.
The following is a summary of sexual harassment complaints received and disposed ofduring the year:
No. of complaints received: Nil No. of complaints disposed off: Nil
Your Company considers its Human Resources as the key to achieve its objectives.Keeping this in view your Company takes utmost care to attract and retain qualityemployees. The employees are sufficiently empowered and such work environment propels themto achieve higher levels of performance. The unflinching commitment of the employees isthe driving force behind the Company's vision. Your Company appreciates the spirit of itsdedicated employees.
40.INSIDER TRADING REGULATIONS
The Company has adopted a 'Code of Conduct to Regulate Monitor and Report Trading byInsiders' ("the Code") in accordance with the SEBI (Prohibition of InsiderTrading) Regulations 2015 (The PIT Regulations). The Code is applicable to PromotersMember of Promoter's Group all Directors and such Designated Employees who are expectedto have access to unpublished price sensitive information relating to the Company. TheCompany Secretary is the Compliance Officer for monitoring adherence to the SEBI(Prohibition of Insider Trading) Regulations 2015. The Company has also formulated 'TheCode of Practices and Procedures for Fair Disclosure of Unpublished Price SensitiveInformation (UPSI)' in compliance with the SEBI (PIT) Amendment Regulations 2018. ThisCode is displayed on the Company's website.
Your Directors place on record their appreciation of the continued patronage extendedto the Company by bankers dealers customers suppliers employees and shareholders. Thetrust reposed in your Company by its esteemed customers helped stabilized growth duringthe year review.
FOR AND ON BEHALF OF THE BOARD
SD/- RAMABHOTLA SRINIVASA SUDHISH
CHAIRMAN &MANAGING DIRECTOR
September 4 2019 Hyderabad