Your Directors present herewith the 32nd Annual Report of the Company forthe year ended 31st March 2017.
| || ||(Amt. in Lakhs) |
|Particulars ||For the Year Ended 31.03.2017 ||For the Year Ended 31.03.2016 |
|Sales ||381.66 ||326.40 |
|Other Income ||17.23 ||12.49 |
|Total Income ||398.89 ||338.89 |
|Total Expenditure ||394.00 ||335.11 |
|Profit/(Loss) before tax ||4.89 ||3.78 |
|Provision for Tax ||1.51 ||1.24 |
|Net Profit/(Loss) ||3.38 ||2.74 |
|Paid Up Share Capital ||445.70 ||445.70 |
REVIEW OF OPERATION
During the year under review your Company's performance satisfactory under thechallenging market circumstances. The turnover and the net profit of the company haveincreased by 17.70% and by 23.26% respectively in comparison to the turnover and netprofit of the previous year. The Company has earned the total revenue of Rs. 381.66 Lakhand other income of Rs. 17.23 Lakh as compared to Rs. 326.40 Lakh of Sale and Rs. 12.49Lakh of other incomes in previous Financial Year. The profit margin of the company hascontracted.
The issued subscribed and paid up capital of the Company is Rs 44570040 (Rupees FourCrore Forty Five Lacs seventy Thousands Forty) divided into 44 57004 (Forty four lacsfifty seven thousands four) equity shares of Rs 10 each. There has been no change in theshare capital of the Company during the year.
The Board of Directors of your Company is of the opinion that keeping in view thefuture fund requirements of the Company and average financial performance your Directorshave not recommended any dividend on equity shares for the year under review. The Boardassures you to present a much strong financial statements in coming years.
The net movement in major reserves of the Company for Financial Year 2016-17 and theprevious year as follows:
|Particulars ||31/03/2017 ||31/03/2016 |
|Surplus in Statement of Profit and Loss || || |
|Opening balance ||2909886 ||2635680 |
|Net Profit/(Loss) for the year ||337978 ||274206 |
|Excess/(Short) of Previous Years ||- ||- |
|Sub Total ||3247864 ||2909886 |
|(-) Utilized for issue of Bonus Shares ||- ||- |
|(-) Tax on Dividend ||- ||- |
|Total ||3247864 ||2909886 |
DETAIL OF BOARD MEETING
During the financial year ended March 31 2017 12 meetings of the Board of Directorswere held as against the statutory minimum requirement of 4 times. None of the two BoardMeetings have a gap of more than 120 days between them. The dates of meetings arementioned below:
|Sr. No. ||Date |
|1. ||11.04.2016 |
|2. ||28.05.2016 |
|3. ||30.05.2016 |
|4. ||03.08.2016 |
|5. ||12.08.2016 |
|6. ||03.09.2016 |
|7. ||25.10.2016 |
|8. ||07.11.2016 |
|9. ||14.11.2016 |
|10. ||16.01.2017 |
|11. ||14.02.2017 |
|12. ||07.03.2017 |
STATEMENT OF DECLARATION GIVEN BY INDEPENDENT DIRECTOR
The Board of Directors of the Company has received declaration of Independence fromeach Independent Director in pursuance of section 149(7) of the Companies Act 2013.
POLICY REGARDING THE APPOINTMENT OF BOARD OF DIRECTORS
The Board of Directors adopted uniform policy for the appointment of Director inpursuance of various provisions of Companies Act and Listing Agreement.
Detail of Board of Directors
|Sr. No. ||Name of Director ||Designation ||Date of Appointment ||Date of Cessation |
|1. ||Gagan Anand ||Managing Director ||30.05.2016 ||- |
|2. ||Arvind Agarwal ||Director ||01.03.2013 ||- |
|3. ||Kuldip Singh ||Director ||14.06.2013 ||- |
|4. ||Seema ||Additional Director ||31.12.2016 ||- |
|5. ||Preeti Srivastava ||Director ||31.03.2015 ||07.11.2016 |
CRITERIA FOR DETERMINING QUALIFICATIONS POSITIVE ATTRIBUTES AND INDEPENDENCE OF ADIRECTOR
The Nomination and Remuneration Committee has formulated the criteria for determiningqualifications positive attributes and independence of Directors in terms of provisionsof Section 178 (3) of the Act is annexed as Annexure 1 to this Report.
ANNUAL EVALUATION OF PERFORMANCE OF BOARD OF DIRECTORS AND ITS COMMITTEES
Pursuant to the provisions of the Act the Board has carried out an annual evaluationof its own performance performance of the Directors individually as well as theevaluation of the working of its Committees. The following process was adopted for BoardEvaluation:
Feedback was sought from each Director about their views on the performance of theBoard covering various criteria such as degree of fulfillment of key responsibilitiesBoard structure and composition establishment and delineation of responsibilities tovarious Committees effectiveness of Board processes information and functioning Boardculture and dynamics quality of relationship between the Board and the Management andefficacy of communication with external stakeholders. Feedback was also taken from everydirector on his assessment of the performance of each of the other Directors.
Every statutorily mandated committee of the Board conducted a self-assessment of itsperformance and these assessments were presented to the Board for consideration. Areas onwhich the Committees of the Board were assessed included degree of fulfillment of keyresponsibilities adequacy of Committee composition and effectiveness of meetings.
Feedback was provided to the Directors as appropriate. Significant highlightslearning and action points arising out of the evaluation were presented to the Board.
In accordance with the requirements of the Companies Act 2013 and the Company'sArticles of Association there is no such Director who is eligible for retire by Rotation.The Company has received declarations from all the Independent Directors of the Companyconfirming that they meet the criteria of independence as prescribed under Section 149(6)of the Companies Act 2013.
REMUNERATION POLICY FOR THE BOARD OF DIRECTORS KEY MANAGERIAL PERSONNEL AND OTHEREMPLOYEES
In terms of the provisions of Section 178(3) of the Act and as per the ListingAgreement the Nomination and Remuneration Committee is responsible for formulating thecriteria for determining qualification positive attributes and independence of aDirector. The Nomination and Remuneration Committee is also responsible for recommendingto the Board a policy relating to the remuneration of the Directors Key ManagerialPersonnel and other employees. In line with this requirement the Board has adopted thePolicy on Board Diversity and Director Attributes and Remuneration Policy for DirectorsKey Managerial Personnel and other employees of the Company. The Remuneration Policy isannexed as Annexure 2 to this report.
COMMITTEES OF THE BOARD
The Committees of the Board focus on certain specific areas and make informed decisionsin line with the delegated authority. The following substantive Committees constituted bythe Board function according to their respective roles and defined scope:
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION
The information on conservation of energy and technology absorption stipulated underSection 134 (3) (m) of the Act read with Rule 8 of The Companies (Accounts) Rules 2014:
The Company did not use any energy during the year under review. Your Company isconscious about its responsibility to conserve energy power and other energy sourceswherever possible.
Further your company has not imported any technology. However we believe and useinformation technology in all spheres of our activities to improve efficiency levels.
FOREIGN EXCHANGE EARNINGS AND OUTGO
Detail of Foreign exchange earnings and outgo of your Company is below mentioned:
| || ||(Amt. in Rs.) |
|Particulars ||FY 2017 ||FY 2016 |
|Foreign Exchange earning ||0.0 ||0.0 |
|Foreign Exchange outflow ||0.0 ||0.0 |
LISTING ON THE STOCK EXCHANGE
The Company's shares are listed with BSE Limited and the Company has paid the necessarylisting fees for the Financial Year 2017-18.
CORPORATE GOVERNANCE REPORT
In pursuance of SEBI Circular CIR/CFD/POLICY CELL/7/2014 dated September 15 2014Regulation 27(2) of SEBI (Listing Obligations and Disclosure Requirements) Regulations2015 shall be applicable on those companies having paid up equity share capital exceedingRs.10 crore and Net Worth exceeding Rs.25 crore as on the last day of the previousfinancial year. The paid up share capital and net worth of your company do not qualify forapplicability of Regulations of SEBI disclosure requirement. Therefore separate Report ofCorporate Governance is not attached herewith.
In spite of above said SEBI circular Your Company adopts best practices for corporategovernance disclosure standard and enhanced shareholder value while protecting theinterest of all other stakeholders including clients its employee. This has enabled yourCompany to earn the trust and goodwill of its investors business partners employees andthe communities in which it operates. Your directors believe that Company profitabilitymust go hand in hand with a sense of responsibility towards all stakeholders employee andcommunities.
RELATED PARTY TRANSACTION
There were no contracts or arrangements entered into by the Company in accordance withthe Section 188 of the Companies Act 2013.
The Company has not accepted any deposits during the under review.
DIRECTOR'S RESPONSIBILITY STATEMENT IN PURSUANCE OF SECTION 134(3)(C) OF THECOMPANIES ACT 2013
The financial statements are prepared in accordance with the Accounting standard asprescribed under Section 133 of the Companies Act 2013 (the Act') read with Rule 7of the Companies (Accounts) Rules 2014 the provisions of the Act (to the extentnotified) and guidelines issued by the Securities and Exchange Board of India (SEBI).There are no material departures from prescribed accounting standards in the adoption ofthese standards.
The directors confirm that:
In preparation of the annual accounts for the financial year ended March 312017 the applicable accounting standards have been followed.
The directors have 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 and loss of the Company for that period.
The directors have taken proper and sufficient care towards the maintenance ofadequate accounting records in accordance with the provisions of this Act for safeguardingthe assets of the Company and for preventing and detecting fraud and other irregularities.
The directors have prepared the annual accounts on a going concern basis.
The directors have laid down internal financial controls which are adequate andare operating effectively.
The directors have devised proper systems to ensure compliance with theprovisions of all applicable laws and such systems are adequate and operating effectively.
EXTRACT OF ANNUAL RETURN
In accordance with Section 134(3) (a) of the Companies Act 2013 an extract of theannual return in the prescribed format is appended as Annexure 3 to the Board'sreport.
The audit committee in its meeting after discussion have recommended Board appointmentof M/s Amit Manoj & Co. Chartered Accountants as the Statutory Auditors of theCompany from 07.08.2017 till the conclusion of Annual General Meeting to be held in theyear 2022 due to the casual vacancy caused consequent to the resignation of M/s. SudhirAgarwal & Associates Chartered Accountants Delhi (Registration no. 509930N) dated07.08.2017 be and is hereby approved and that they shall hold the said office till theconclusion of this Annual General Meeting. In terms of the first proviso to Section 139 ofthe Companies Act 2013 the appointment of the auditors shall be placed for ratificationat every Annual General Meeting. Accordingly the appointment of Amit Manoj & Co.Chartered Accountants as statutory auditors of the Company is placed for ratification bythe shareholders. In this regard the Company has received a certificate from the auditorsto the effect that if they are reappointed it would be in accordance with the provisionsof Section 141 of the Companies Act 2013.
N S & ASSOCIATES Practicing Company Secretary was appointed to conduct thesecretarial audit of the Company for the financial year 2016-17 as required under Section204 of the Companies Act 2013 and Rules thereunder. The secretarial audit report for FY2016-17 forms part of the Annual Report as Annexure 5 to the Board's report.
In the opinion and to the best of the information and according to the records andexplanation provided to Secretarial Auditor Auditor has found the following observations:
1. NON COMPLIANCE IN APPOINTMENT OF COMPANY SECRETARY OF THE COMPANY
As per the provisions of the section 203 of the Companies Act 2013 & otherapplicable laws a listed company has whole time company secretary in employment.
As per the records provided to us and examined by us the Company has not appointed awhole time Company Secretary
Management assure you that effective step will be taken in the coming year to appoint aCompany Secretary.
LOANS GUARANTEES SECURITIES AND INVESTMENTS
The Company has given short term loan & Advances of Rs 48192770 in currentfinancial year the details of which is mentioned in the balance sheet attached to thisreport.
SIGNIFICANT AND MATERIAL ORDERS
No Significant and Material orders during the year.
INTERNAL FINANCIAL CONTROL
Internal financial control systems of the Company are commensurate with its size andthe nature of its operations. These have been designed to provide reasonable assurancewith regard to recording and providing reliable financial and operational informationcomplying with applicable accounting standards and relevant statutes safeguarding assetsfrom unauthorized use executing transactions with proper authorization and ensuringcompliance of corporate policies. The Company has a well defined delegation of authoritylimits for approving revenue as well as expenditures. Processes for formulating andreviewing annual and long term business plans have been laid down.
The Audit Committee deliberated with the members of the management considered thesystems as laid down and met the statutory auditors to ascertain inter alia their viewson the internal financial control systems. The Audit
Committee satisfied itself on the adequacy and effectiveness of the internal financialcontrol system as laid down and kept the Board of Directors informed.
MATERIAL CHANGES AND COMMITMENT
In the year your Company not entered as such contract agreement or arrangement whichaffects the material position and financial position of the Company.
RISK MANAGEMENT POLICY
The Board of Directors of the Company has formulated a Risk Management Policy whichaims at enhancing shareholders' value and providing an optimum risk reward tradeoff. Therisk management approach is based on a clear understanding of the variety of risks thatthe organization faces disciplined risk monitoring and measurement and continuous riskassessment and mitigation measures.
PREVENTION OF SEXUAL HARASSMENT
The Company has zero tolerance for sexual harassment at workplace and has adopted apolicy on prevention prohibition and redressal of sexual harassment at workplace in linewith the provisions of the Sexual Harassment of Women at Workplace (PreventionProhibition and Redressal) Act 2013 (POSH Act) and the Rules framed thereunder.
SUBSIDIARIES AND ASSOCIATES
Company does not have any subsidiary or associates Company.
PARTICULARS OF EMPLOYEES
During the year under review no employee is covered as per rules 5(2) & (3) of theCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014 therefore nostatement is required be given showing the names and other particulars of the employeesdrawing remuneration in excess of the limits set out in the said rules are not applicable.
PARTICULARS OF REMUNERATION
The information required under Section 197(12) of the Companies Act 2013 read withRule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules2014
i) The ratio of the remuneration of each Director to the median remuneration of theemployees of the Company for the financial year 2016-17:
Gagan Anand Director of the company has drawn remuneration of Rs. 180000/- from theCompany therefore ratio of remuneration of each director the median remuneration of theemployees of the Company is 0.12:0.88.
ii) The percentage increase in remuneration of each Director Chief Financial OfficerChief Executive Officer Company Secretary or Manager if any in the financial year2016-17:No remuneration was paid in the previous year therefore the percentage increase inremuneration can not be calculated.
iii) The percentage increase in the median remuneration of employees in the financialyear 2016-17:7.18
iv) The number of permanent employees on the rolls of company: 5
v) Average percentile increase already made in the salaries of employees other than themanagerial 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:
Gagan Anand Director of the company has drawn remuneration of Rs. 180000 from theCompany during the financial year 2016-17 therefore the Average percentile increase inremuneration is : previous year non of the director getting any remuneration from thecompany so increase in remuneration cannot be determined for current year.
vi) The key parameters for any variable component of remuneration availed by theDirectors:
The key parameters for the variable component of remuneration if any availed by theDirectors are considered by the Board of Directors based on the recommendations of theNomination and Remuneration Committee as per the Nomination & Remuneration Policy forDirectors.
Director has drawn any remuneration from the Company during the financial year 2016-17.
vii) Affirmation that the remuneration is as per the remuneration policy of theCompany:
It is hereby affirmed that the remuneration paid is as per the Nomination andRemuneration Policy of the Company.
The Company believes in the conduct of the affairs of its constituents in a fair andtransparent manner by adopting highest standards of professionalism honesty integrityand ethical behavior. In line with the Code of Conduct any actual or potential violationhowsoever insignificant or perceived as such would be a matter of serious concern for theCompany. The role of the employees in pointing out such violations of the Code of Conductcannot be undermined.
Pursuant to Section 177(9) of the Act a vigil mechanism was established for directorsand employees to report to the management instances of unethical behavior actual orsuspected fraud or violation of the Company's code of Conduct or ethics policy. The VigilMechanism provides a mechanism for employees of the Company to approach the Chairman ofthe Audit Committee of the Company.
Directors wish to place on record their deep thanks and gratitude to;
a) The Central and the State Government as well as their respective Departments andDevelopment Authorities connected with the business of the Company the Bankers of theCompany as well as other Institutions for their co-operation and continued support.
b) The Shareholders Suppliers and the Contractors for the trust and confidence reposedand to the Customers for their valued patronage.
c) The Board also takes this opportunity to express its sincere appreciation for theefforts put in by the officers and employees at all levels in achieving the results andhopes that they would continue their sincere and dedicated endeavour towards attainment ofbetter working results during the current year.
| || |
By the order of Board of Director of Divinus Fabrics Limited
| || |
(Formerly known as Avishkar Finance Company Limited)
|Regd. Office: || || |
|Plot No. 15 B-2 D Block Market || || |
|Vivek Vihar Delhi - 110095 || || |
| ||Sd/- ||Sd/- |
|Date: 04.09.2017 ||Gagan Anand ||Arvind Agrawal |
|Place: New Delhi ||Managing Director ||Director |
| ||DIN:06957651 ||DIN:03035484 |