Duncan Engineering Limited
Your Directors have pleasure in presenting the Sixtieth Annual Report of the Company onthe business and operations of the Company together with the Audited Financial Statementsfor the year ended March 312021.
The Company's performance during the financial year ended March 312021 as compared tothe previous financial year is summarized below:
(Rupees in Lacs)
|Particulars ||2020-21 ||2019-20 |
|Total Revenue ||4199.78 ||4438.98 |
|Total Expenses (incl. Exceptional item of Rs.175.58 Lacs in 2019-20) ||-3822.01 ||-4116.94 |
|Profit/(Loss) before Tax ||377.77 ||322.04 |
|Profit/(Loss) from continuing operations before Tax ||377.77 ||322.04 |
|Tax Expenses (Current Tax) - || || |
|Tax Expenses (earlier year)- Deferred Tax ||-423.80 ||4.01 |
|Profit/(Loss) from continuing operations after Tax ||801.57 ||318.03 |
|Profit/(Loss) from discontinuing operations before Tax || ||- |
|Tax Expenses (Current Tax) || ||- |
|Profit/(Loss) from discontinuing operations after Tax - || || |
|Profit/(loss) for the year ||801.57 ||318.03 |
The Board of Directors have not recommended to declare any dividend in order toconserve the fund for the growth of the Company.
Financial year 2020-21 was one of the most challenging years your company has witnessedin recent times. Most part of first quarter was lost as the plant was shut down for 44days due to nationwide lockdown declared by the Government. Even after resuming theoperations the Company faced many challenges such as scarcity of raw material highabsenteeism delay in despatch the finished products due to lack of transport local lockdowns etc.
However things started to improve from second quarter onwards as lock downrestrictions became less stringent and industrial operations slowly limped back to normal.The sales orders started to pour in as our customers/ dealers resumed their operations.Similarly our vendors also started working resulting in better inflow of raw materials.Manpower issues also started to subside as inter-state/district/city transport movementsbecame operational and travel restrictions reduced substantially.
The overall performance of your Company during the year under review is satisfactoryconsidering that it was marred by the pandemic. In spite of the pandemic and otherchallenges your company managed to achieve an annual turnover of Rs.4199.78 Lacs. withmajor contribution from Power and Cement sector. The revenue for the year have notimproved much as we got only three quarters. However things are looking positive for thenext fiscal year as India is slowly recovering from the economic slowdown. Having saidthat the second wave of COVID is seem to be alarming and may affect the growth prospect ofthe Company.
Pursuant to Section 134(3)(a) and Section 92(3) of the Companies Act 2013 read withCompanies (Amendment) Act 2017 a copy of Annual Return (eForm MGT-7) is available on thewebsite of the company www.duncanengg.com under investor dropdown.
Internal Financial Controls
Your Company has an internal control system commensurate with the size scale andcomplexity of its operations. Internal Audit is conducted throughout the organization byqualified outside Internal Auditors. Findings of the internal Audit Report are reviewed bythe top Management and by the Audit Committee of the Board and proper follow up actionsare ensured wherever required. M/s Pipalia Singhal & Associates are the InternalAuditor of the Company.
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 Statutory Auditors and the InternalAuditors of the Company on the inefficiency or inadequacy of such controls.
The Company has not accepted any fixed deposits from the public or shareholders fallingwithin the ambit of Section 73 of the Companies Act 2013 and The Companies (Acceptance ofDeposits) Rules 2014.
Particulars of loans/advances/investments outstanding during the financial year
The company has not given any loans or guarantees covered under the provisions ofsection 186 of the Companies Act 2013. The details of the Investments made and loangiven/taken by company is mentioned in the Notes to the financial statements.
Report on performance and financial position of subsidiaries associates and jointventure companies
During the year under review your Company did not have any subsidiary associate andjoint venture.
AUDITORS AND THEIR REPORTS
The matters related auditors and their reports are as under:
Statutory Auditor's appointment
At the Annual General Meeting held on July 29 2020 the members have approved theappointment of M/s SS Kothari Mehta & Co. Chartered Accountants (RegistrationNo.000756N) as a Statutory Auditor of the Company for a period of five consecutive yearsi.e. for a term up to the conclusion of 64th Annual General Meeting to be held in thecalendar year 2025.
The Company has received a certificate from the said Auditors that they are eligible tohold office as the Auditors of the Company and are not disqualified for being soappointed.
Observations of Statutory Auditors on Financial Statements for the year ended March312021
As regards the comments in the Auditors' Report if any the relevant notes in theAccounts are self-explanatory and may be treated as information/ explanation submitted bythe Board as contemplated under provisions of the Companies Act 2013.
Explanation & Comment by the Board on the qualifications or adverse remarks made bythe auditors
There were no qualifications reservations or adverse remarks or claims made by theauditors.
As required under the provisions of Section 204 of the Companies Act 2013 and theCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014 M/s ShaswatiVaishnav & Associates Company Secretary in Practice has undertaken the SecretarialAudit of the Company for the year ended 31st March 2021. The Secretarial Audit Report isannexed herewith in Form No. MR-3. There are no qualifications reservation or adverseremarks or disclaimer made by the auditor in the report save and except disclaimer made bythem in discharge for their professional obligation.
MATTERS RELATED TO DIRECTORS AND KEY MANAERGIAL PERSONNEL
Board of Directors and Key Managerial Personnel (KMP)
The following three persons were formally appointed as Key Managerial Personnel of theCompany as per the provisions of Sec 203 of the Companies Act 2013.
a) Mr. Akshat Goenka Managing Director
b) Mr. K Raghu Raman Chief Financial Officer
c) Mr. Rajib Kumar Gope Company Secretary
In accordance with the provisions of the Companies Act 2013 and in terms of theMemorandum and Articles of Association of the Company Mr Jagdish Prasad Goenka (holdingDIN 00136782) is liable to retire by rotation and being eligible for reappointment offerhimself for re-appointment. Your Directors have proposed his re-appointment as set out inthe notice of AGM.
In accordance with the Sections 196 197 203 and other applicable provisions if anyof the Companies Act 2013 ("the Act") (including any statutory modification orre-enactment thereof for the time being in force) read with Schedule V to the Act and theCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014 yourdirectors have proposed reappointment of Mr. Akshat Goenka as Managing Director of theCompany for a period of five years w.e.f. 9th February 2022.
Compliance of Code of Conduct for Directors and Senior Management Personnel.
Declaration on compliance of Code of Conduct is received from Directors and SeniorManagement Personnel.
Managing Director's Remuneration:
Mr. Akshat Goenka is the Managing Director of the Company. The remuneration detail ofMr. Akshat Goenka is disclosed in Corporate Governance Report. Mr. Akshat Goenka is alsoJt. Managing Director in Oriental Carbon Chemicals Limited Holding Company. He received aSalary of Rs.12000 and Commission Rs. 19.50 Lacs from Duncan Engineering Limited in theyear 2020-21. In addition to the remuneration from Duncan Engineering Limited he alsoreceived a remuneration of Rs 25164690 P.A. from Oriental Carbon & ChemicalsLimited in 2020-21.
The bifurcation of the remuneration drawn by Mr. Akshat Goenka from Oriental Carbon& Chemicals Limited as follows:
(Amount in Rs.)
|Name ||Salary ||Commission ||Contribution to PF ||Perq. And other allowances ||Total |
|Mr. Akshat Goenka ||7056000 ||10244000 ||823200 ||7041490 ||25164690 |
Declaration by Independent Directors
Pursuant to the provisions of sub-section (7) of Section 149 of the Companies Act2013 the Company has received individual declarations from all the Independent Directorsconfirming that they fulfil the criteria of independence as specified in Section 149(6) ofthe Companies Act 2013 and have complied with the Code for Independent Directorsprescribed in Schedule IV to the Act.
Annual Performance Evaluation
As per Section 134(3)(p) of the Companies Act 2013 read with sub-rule (4) of Rule 8 ofthe Companies (Accounts) Rules 2014 and SEBI(LODR) Regulation 2015 the Board has carriedout an annual performance evaluation of its own performance the directors individually aswell as the evaluation of the working of the other Committees.
The performance of the Board was evaluated by the Board of Directors after seekinginputs from all the Directors. The performance of the Committees was evaluated by theBoard after seeking inputs from the Committee members. The Board focused on criteria likestrategy effectiveness Board Structure and Committees Board Meetings and Procedureswhile evaluating its own performance and that its committees. The Policy on PerformanceEvaluation is also available on the website of the Company i.e. www.duncanengg.com.
For the purpose of evaluation the Directors have been classified into threecategories: Independent Directors Non-Executive Directors and Executive Directors.Independent & Non- Executive Directors were evaluated on the basis of EngagementAdherence to Code of Conduct Strategic Planning Team Spirit Consensus Buildingleadership and domain knowledge. Whereas Executive Director is evaluated on Managementqualities Team work abilities Result/Achievements Domain Knowledge Understanding &Awareness etc.
Director's Responsibility Statement
To the best of your Director's knowledge and belief and according to the informationand explanations obtained your Directors make the following statements in terms of section134 (3) (c) of the Companies Act 2013:
i) that in the preparation of the annual financial statements for the year ended March31 2021 the applicable Accounting Standard (Ind AS) have been followed along with properexplanation relating to material departures if any;
ii) the directors had 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 theprofit and loss of the Company for that period.
iii) that proper and sufficient care has been taken for the maintenance of adequateaccounting records in accordance with the provisions of the Companies Act 2013 forsafeguarding the assets of the Company and for preventing the detecting fraud and otherirregularities;
iv) that the annual financial statements have been prepared on a going concern basis;
v) that proper financial controls were in place and that the financial controls wereadequate and were operating effectively.
vi) that systems to ensure compliance with the provisions of all applicable laws werein place and were adequate and operating effectively.
DISCLOSURE RELATED TO BOARD COMMITTEES AND POLICIES
Board and Committee Meetings
The The Company holds Meetings as per Companies Act 2013 and the Listing Agreementsigned with the Stock Exchange. During the year four Board Meetings and four AuditCommittee meetings were convened and held. The details of which are given in the CorporateGovernance Report. The intervening gap between the Meetings was within the periodprescribed under the Companies Act 2013 and SEBI (Listing Obligations DisclosureRequirements) Amendment Regulations 2018. Additionally on January 27 2021 theIndependent Directors held a separate meeting in compliance with the requirements ofSchedule IV of the Companies Act 2013.
The Board of Directors met four times in FY 2020-21 on June 3 2020; July 30 2020;October 23 2020 and January 27 2021.
The Audit Committee comprises four Non-Executive-Independent Directors namely Mr. O PDubey is the Chairman and Mr. B B.Tandon Mr. Nitin Kaul and Mrs. Arti Kant are theMembers of the Committee. All the recommendations made by the Audit Committee during theyear were accepted by the Board. The Chief Financial Officer and Auditors are permanentinvitees to the committee meetings. The detail of terms of reference of Audit Committeenumber and dates of meetings held attendance of the directors and remunerations paid tothem are given separately in the Corporate Governance Report. The Audit Committee met fourtimes in FY 2020-21 i.e. on June 3 2020; July 30 2020; October 23 2020 and January 272021.
Nomination and Remuneration Committee
The Company has a Nomination & Remuneration Committee as per the requirementsprescribed under Section 178 (1) of the Companies Act 2013. The Nomination andRemuneration Committee has Mr. O P Dubey as Chairman Mr. B B Tandon Mr. Arvind Goenkaand Mr. Nitin Kaul as Members. The Company has a policy on Directors appointment &remuneration which is posted on the website of the Company. The details terms of referenceof the committee has been given in the Corporate Governance Report. The Nomination &Remuneration Committee met only once in FY 2020-21 i.e. on June 3 2020.
The Stake holder's Relationship Committee:
The Company has a Stakeholder's Relationship Committee for reviewingshareholder/investors complaints and grievances. Presently the Committee is led by Mr. O PDubey (Chairman) Mr. Akshat Goenka and Mrs. Arti Kant are the other two members of theCommittee. On 23rd October 2020 Mr. J P Goenka resigned as member and Chairman of theCommittee. Mr. O P Dubey was appointed as Chairman in place of Mr. J P Goenka. Mr. AkshatGoenka joined as a member of the Committee on 23rd October 2020. The detail terms ofreference of the committee has been given in the Corporate Governance Report. There werefour meetings of Stakeholder's Relationship Committee were held in FY 2020-21 i.e. on June3 2020; July 30 2020; October 23 2020 and January 27 2021.
Company's Policy on Directors' appointment and remuneration
The Board has on the recommendation of the Nomination and Remuneration Committeeframed a policy to ensure that Company's Directors Key Managerial Personnel and othersenior management employees are sufficiently incentivised for enhanced performance.Remuneration of executive directors are linked to iincrease in stakeholder's wealthtarget achievement in term of sales margin new initiatives taken optimum utilization ofresources people management risk mitigation qualification experience and merits etc.Remuneration should be reasonable and sufficient to attract and retain employees.Independent Directors receive remuneration by way of sitting fees for attending meetingsof Board and Committees (where they are members). The Remuneration Policy of the Companyis also available on the website of the Company which is www.duncanengg.com.
Vigil Mechanism/Whistle Blower Policy
The Company has a vigil mechanism named Whistle Blower Policy to deal with instances offraud and mismanagement if any. A vigil (Whistle Blower) mechanism provides a channel tothe employees and Directors to report to the Management concerns about unethicalbehaviour actual or suspected fraud or violation of the Codes of Conduct or Policy. Themechanism provides for adequate safeguards against victimization of employees andDirectors to avail of the mechanism and also provide for direct access to the ManagingDirector / Chairman of the Audit Committee in exceptional cases. The details of theWhistle Blower Policy are explained in the Corporate Governance Report and also posted onthe Company's website i.e. www.duncanengg.com.
The Board of Directors of the Company look into the element of risk associated with theCompany. At present the company has not identified any element of risk which in theopinion of the Board may threaten the existence of the Company. However risks like unevendemand-supply labour unrest' high employee turnover ratio pandemic etc. may adverselyaffect the performance of the Company in the upcoming financial year.
During the year under review no instances of fraud were reported by the StatutoryAuditors of the Company.
Disclosures under Sexual Harassment of Women at Workplace (Prevention Prohibition& Redressal) Act 2013
The Company has in place an Anti-Sexual Harassment Policy line with the requirements ofThe Sexual Harassment of Women at the Workplace (Prevention Prohibition & Redressal)Act 2013. An internal committee has been set up to redress complaints received regardingsexual harassment. No complaint received during the year under review.
OTHER DISCLOSURES Corporate Governance
As per Schedule V of SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 a section on Corporate Governance and Management Discussion andAnalysis is annexed to this report.
A certificate from M/s Vaishnav Associates Pune (ACS 8675 C.P. No. 11392) confirmingcompliance of Corporate Governance is also annexed.
Compliance of Secretarial Standards
The Company has complied the applicable Secretarial Standards issued by the Instituteof Company Secretaries of India.
Insider Trading Regulations
Based on the requirements under the SEBI (Prohibition of Insider Trading) Regulations2015 as amended from time to time
the Code of Conduct for prevention of Insider Trading is in force in your Company. TheBoard of Directors of the Company has adopted the revised Code of Practices and Proceduresfor Fair Disclosure of Unpublished Price Sensitive Information in compliance with ChapterIV of the said Regulations and the same has been uploaded on the Company's websitewww.duncanengg.com.
Conservation of Energy Technology Absorption Exports and Foreign Exchange Earningsand Outgo
A statement giving details of conservation of energy technology absorption exportsand foreign exchange earnings and outgo pursuant to Section 134(3) (m) read with Companies(Accounts) Rules 2014 is annexed to Board's Report.
Particulars of Employees and Remuneration
The information as required under the provisions of Section 197(12) of the CompaniesAct 2013 and Rule 5 of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014 are set out in Annexure attached herewith and which forms part ofthis report.
Investor Education & Protection Fund
The Company has last declared dividend in 2009-10 hence no amount is liable to betransferred to the Investor Education and Protection Fund (IEPF) under sub-section (2) ofsection 125 of the Act and the IEPF (Accounting Audit Transfer and Refund) Rules 2016.Similarly no shares are due for transfer to the IEPF.
The Company has appointed Mr. Rajib Kumar Gope Company Secretary as Nodal Officerunder the provisions of IEPF Rules. The details of the Nodal Officer is available in thewebsite of the Company www.duncanengg.com under Investor dropdown.
Related Party Transactions
All related party transactions that were entered into during the financial year were onarms' length basis and were in the ordinary course of business. There are no materiallysignificant related party transactions made by the Company with promoters Directors KeyManagerial Personnel or other designated persons which may have a potential conflict withthe interest of Company at large. All Related Party transactions form part to the Notes tothe Balance Sheet (Refer Note No. 36) All Related Party transactions are placed before theAudit Committee. Prior omnibus approval of the Audit Committee is obtained for thetransactions which are of foreseen and repetitive nature. The approved Policy on RelatedParty transactions is also available on the website of the company www.duncanengg.comunder investor dropdown.
The Accounts for the year have been prepared as per Indian Accounting Standards (IndAS) and all the current year and previous year figures have been re-stated accordingly. Notreatment different from that prescribed in Accounting Standards (Ind AS) has beenfollowed by the Company.
Your Company has obtained Credit Rating from ICRA Ltd. The Credit Rating was obtainedon 19.02.2021. Latest available Credit Rating was [ICRA] A-(Stable)/[ICRA]A2+.
Research and Development
Research & Development is fundamental to the Company's efforts to maintain thetechnical and quality edge. New products are continuously being developed to meetcustomers varied requirements. Research in the areas of reducing utilities cost andprocess parameters improvement is also being done.
Disclosures under Section 134(3)(l) of the Companies Act 2013
Except as disclosed elsewhere in this report no material changes and commitments whichcould affect the Company's financial position have occurred between the end of thefinancial year of the Company to which the financial statement relates and date of thisreport.
Disclosure of Orders passed by Regulators or Courts or Tribunal
No significant and material orders have been passed by any Regulator or Court orTribunal which can have impact on the going concern status and the Company's operations infuture.
Disclosure relating to equity shares with differential rights
The Company has not issued any equity shares with differential rights during the yearunder review and hence no information as per provisions of Rule 4(4) of the Companies(Share Capital and Debenture) Rules 2014 is furnished.
Your Company's Plant has the requisite consent to operate from Maharashtra PollutionControl Board and meets all the desired and statutory norms in this regard.
Statutory Compliance Strictures and Penalties
The Company has complied with rules and regulations prescribed by the Bombay StockExchange Securities Exchange Board of India and any other statutory authority relating tocapital market.
No penalties and/or strictures have been imposed on the Company by Stock Exchange orSEBI or any statutory authority during the last three years.
Your Directors would like to thank to the employees customers suppliers bankersbusiness partners other regulatory agencies and wish to acknowledge and place on recordtheir sincere appreciation for the excellent support given by them to the Company andtheir confidence in its Management. Your Directors would also like to thank the members ofthe Company for reposing their confidence and faith in the Company and its Management.
| ||On behalf of the Board of Directors |
| ||Akshat Goenka ||Arvind Goenka |
|Place: Noida ||Managing Director ||Director |
|Date: 07.05.2021 ||DIN:07131982 ||DIN:00135653 |