E-Land Apparel Ltd.
|BSE: 532820||Sector: Industrials|
|NSE: ELAND||ISIN Code: INE311H01018|
|BSE 00:00 | 18 Jan||6.24||
|NSE 00:00 | 18 Jan||6.05||
|Mkt Cap.(Rs cr)||30|
|Mkt Cap.(Rs cr)||29.95|
E-Land Apparel Ltd. (ELAND) - Director Report
Company director report
The Members of E-Land Apparel Limited
Your Directors present the 21st Annual Report of the Company togetherwith the Audited Financial Statements for the financial year ended 31st March 2018.
The financial performance of the Company for the year ended 31st March2018 is summarized below:
OPERATIONS OF THE COMPANY / COMPANY PERFORMANCE:
The Company's total income from operations for F.Y. 2017-18 at Rs.18371.52 Lakhs was less as compared to last year by 15.78% (Rs 21814.55 Lakhs in F.Y.2016-17). The total expenses for F.Y. 2017-18 at Rs. 22811.20 Lakhs were lesser by 23.77%over last year (Rs. 29925.96 Lakhs in F.Y. 2016-17). Loss after tax for F.Y. 2017-18stood at Rs. 7842.49 Lakhs as against Rs. 8021.03 Lakhs for F.Y. 2016-17 reflectingdecrease of losses by 2.23%.
TRANSFER TO RESERVES:
As there are losses for the financial year 2017 2018 theCompany did not transfer any amount to reserves during the year.
As there are no profits the Board of Directors of the Company does notrecommend any payment of dividend on the shares for the financial year 2017 2018.
UNPAID DIVIDEND & IEPF
The Unpaid Dividend amount Rs. 137316 (One Lakh Thirty Seven ThousandThree Hundred and Sixteen) as standing in the Unpaid Dividend Account bearing no.386103000001076 maintained with IDBI Bank Limited Cash Management Services (TransactionBanking Group) 4th Floor Mafatlal Centre Nariman Point Mumbai - 400 021 which remainedunpaid or unclaimed for a period of seven years were transferred to the Investor Educationand Protection Fund established by the Central Government). Amount of Rs. 763 is lying inUnpaid Dividend A/c of the Company and shall be transferred to Investor Education andProtection Fund
MATERIAL CHANGES AND COMMITMENTS:
a) CORPORATE DEBT RESTRUCTURING (CDR):
The Company in the year 2012 had applied for the restructuring of itsdebts through Corporate Debt Restructuring (CDR) Mechanism as envisaged under the ReserveBank of India (RBI) guidelines. Pursuant to the same based on approval of the CDR cellthe Company entered into a Master Restructuring Agreement in September 2012. In 2016 theCompany had applied for One Time Settlement (OTS) with all the banks in the consortiumpursuant to which approval was received during the year from all the banks for the OTS inrespect of the borrowing.
During the quarter ended June 302018 the One Time Settlementformalities including reconciliation of balances settlement of dues final approval fromCDR receipt of No Dues Certificate' from banks etc. have been completed intimationwith respect to such settlement has been provided to the exchanges and the relevant formsfor Satisfaction of Charge is also filed
During the year under review your Company's Authorized Share Capitalis Rs. 6001 Lakhs comprising of 60010000 Equity Shares of Rs. 10/- each. The Company'spaid up capital is Rs. 4799.05 Lakhs comprising of 4 7990469 Equity Shares of Rs. 10/-each fully paid up. During the year under review the Company has not issued any shares.The Company has not issued shares with differential voting rights. It has neither issuedemployee stock options nor sweat equity shares. As on March 31 2018 none of theDirectors of the Company holds shares of the Company.
The Equity Shares of the Company are listed on BSE Limited (BSE) withscrip code no. 532820 and on National Stock Exchange of India Limited (NSE) with symbol asELAND.
The listing fee for the year 2017-18 has been paid to both the StockExchanges.
DIRECTORS & KEY MANAGERIAL PERSONNEL
The Board of the Company comprises of Seven Directors including oneManaging Director one Whole Time One Nominee Director appointed by State bank of Indiaand Four Independent Directors including One Woman Director as required under Section149(1) of the Companies Act 2013 as on 31st March 2018.
a) Mr. Jae Ho Song was appointed as the Managing Director of theCompany w.e.f. 30th May 2017
b) Mr. Supriyo Kumar Chaudhuri who was appointed as Nominee Director ofState Bank of India on the Board of the Company w.e.f. 30th May 2017
c) Ms Hemlata Gupta was appointed as Company Secretary w.e.f. 30thMay2018.
a) Mr. Jung Ho Hong (having DIN 02229634) has tendered his resignationas the Whole time Director of the Company with effect from 06th of July 2018.
b) Mr. Supriyo Kumar Chaudhuri who was appointed as Nominee Director ofState Bank of India on the Board of the Company w.e.f. 30th May 2017 has tendered hisresignation with effect from May 29 2018.
c) Ms. Sunita Kanungo resigned from the post of Company Secretaryw.e.f. 30th May2018.
RETIREMENT BY ROTATION
In terms of Section 152 of the Companies Act 2013 and the Articles ofAssociation of the Company Mr. Jae Ho Song (DIN: 07837031) retires by rotation at theensuing Annual General Meeting and being eligible offers himself for re-appointment. Hehas confirmed that he is not disqualified from being appointed as Director in terms ofSection 164 of the Companies Act 2013. A brief resume of Mr. Jae Ho Song (DIN: 07837031)nature of his expertise in specific functional areas and names of the Companies in whichhe holds directorship and / or membership / chairmanship of Committees of the Board asstipulated under the SEBI (Listing Obligations and Disclosure Requirements) 2015 with theStock Exchange/s is given in the Corporate Governance Report which may be taken asforming part of this Report.
DECLARATION BY INDEPENDENT DIRECTORS:
The independent directors have submitted the Declaration ofIndependence as required pursuant to section 149(7) of the Companies Act 2013 andRegulation 16 and 25 of SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 stating that they meet the criteria of independence as provided insub-section (6). There has been no change in the circumstances which has affected theirstatus as independent director. Non-Executive Directors of the Company had no pecuniaryrelationship other than sitting fee for attending meetings.
FORMAL ANNUAL EVALUATION OF THE PERFORMANCE OF BOARD ITS COMMITTEESAND DIRECTORS:
Pursuant to the provisions of the Companies Act 2013 and theregulation 25 of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015a separate meeting of Independent Directors was held during the year without the presenceof Executive Directors. The Board has adopted a formal mechanism for evaluating variousaspects of the Board's functioning its performance and as well as that of its committeeand individual directors. The criteria for performance evaluation of the Board includeaspects like composition of the Board and its Committees culture execution andperformance of specific duties obligations and governance experience competencies etc.The exercise was carried out through a structured evaluation process covering variousaspects of the Boards functioning such as composition of the Board and Committeesexperience and competencies performance of specific duties and obligations governanceissues etc. Separate exercise was carried out to evaluate the performance of IndividualDirectors who was evaluated on parameters such as attendance contribution at the meetingsand otherwise independent judgment safeguarding of minority shareholders interest TheBoard of Directors expressed their satisfaction with the evaluation process.
EXTRACT OF ANNUAL RETURN:
The extract of annual return as provided under sub-section (3) ofSection 92 of the Companies Act 2013 in the prescribed Form MGT 9 is attached as"Annexure A" to this Report. Further a copy of annual return filed for thefinancial year 2016-17 and a copy of Annual Return to be filed for the financial year2017-18 with the Registrar of Companies is placed on the website of the Company:
NUMBER OF MEETINGS OF THE BOARD:
Regular meeting of the Board are held during the year to reviewperformance of the Company to discuss and decide on various business strategies policiesand other issues. During the year 5 meetings of the Board of Directors were convened andheld on 30th May 2017 19th August 2017 14th September 2017 08th December 2017 14thFebruary 2018. The intervening gap between two consecutive meetings was not more than theperiod specified in the Companies Act 2013 and Listing Regulations 2015. The Detailedinformation about the same is given in the Corporate Governance Report.
The Company has complied with the applicable Secretarial Standards inrespect of all the above Board meetings.
COMMITTEES OF THE BOARD
The Board of Directors of your Company has constituted the followingcommittees in terms of the provisions of the Companies Act 2013 and the SEBI (ListingObligations and Disclosure Requirements) Regulations 2015:
l Audit Committee l Nomination and Remuneration Committee lStakeholders' Relationship Committee l Risk Management Committee
The details regarding composition and meetings of these committees heldduring the year under review as also the meetings of the Board of Directors are given inthe Corporate Governance Report which may be taken as forming part of this Report.
REMUNERATION / COMMISSION DRAWN FROM HOLDING / SUBSIDIARY COMPANY
None of the Directors of the Company have drawn any remuneration /commission from the Company's holding Company / subsidiary Companies
MANAGEMENT DISCUSSION AND ANALYSIS
The Management Discussion and Analysis Report on the operations of theCompany as required under SEBI Listing (Obligation and Disclosure Requirement)Regulations 2015 is provided in separate section and form an integral part of thisreport.
CORPORATE GOVERNANCE REPORT
As per Regulation 34 (3) and Chapter IV read with Schedule V of theSEBI Listing (Obligation and Disclosure Requirement) Regulations 2015 a separate Sectionon Corporate Governance Practices followed by the Company together with a certificatefrom the Company's Secretarial Auditors confirming compliances forms an integral part ofthis Report.
The Company has not accepted / renewed any deposits within the meaningof Section 73 and Section 74 of the Companies Act 2013 and the Rules made thereunder.
DIRECTOR'S RESPONSIBILITY STATEMENT:
Pursuant to the provisions of Section 134(3)(c) of the Companies Act2013 your Directors state that:-
(1) In the preparation of the annual accounts for the year ended 31stMarch 2018 the applicable Accounting Standards have been followed and that there are nomaterial departures;
(2) Appropriate accounting policies have been selected 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 as at 31st March 2018and of the loss of the Company for the year ended 31st March 2018;
(3) Proper and sufficient care has been taken for maintenance ofadequate accounting records in accordance with the provisions of the Companies Act 2013for safeguarding the assets of the Company and for preventing and detecting fraud andother irregularities;
(4) They have prepared the annual accounts on a "GoingConcern" basis.
(5) Proper internal financial controls were followed by the Company andthat such internal financial controls are adequate and were operating effectively.
NOMINATION AND REMUNERATION POLICY
The Board on the recommendation of the Nomination and RemunerationCommittee has framed a Remuneration Policy providing
(a) criteria for determining qualifications positive attributes andindependence of directors and (b) a policy on remuneration for directors key managerialpersonnel and other employees. The detailed Nomination and Remuneration Policy is placedon Company's website at http://elandapparel.com/policy.htm PARTICULARS OF LOANSGUARANTEES OR INVESTMENTS:
Information regarding loans guarantees and investments covered underthe provisions of Section 186 of the Companies Act 2013 are detailed in the FinancialStatements.
RELATED PARTY TRANSACTIONS:
All related party transactions that were entered into during thefinancial year were on an arm's length basis and were in the ordinary course of business.
All Related Party Transactions upto 31st March 2018 were placed beforethe Audit Committee and the Board for approval. Prior omnibus approval of the AuditCommittee was obtained for Related Party Transactions for the financial year 2017-18. Thetransactions entered into pursuant to the omnibus approval so granted were audited and astatement giving details of all related party transactions was placed before the AuditCommittee for its review on a quarterly basis.
There are related party transactions as per Section 188 of CompaniesAct 2013 the details of the same are disclosed in Form AOC-2 in that regard which isattached as "Annexure B" to this report.
The Policy on RPTs as approved by Board is uploaded on the Company'swebsite at http://elandapparel.com/policy.htm
The Company undertakes the transactions of purchase and sale of goodsand availing/rendering services with E-Land Group of Companies as mentioned in point 32 inNotes to Accounts.
None of the Directors/Key Managerial Personnel has any pecuniaryrelationships or transactions vis--vis the Company which may have potential conflictwith the interest of the Company at large.
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGEEARNINGS AND OUTGO:
Information in accordance with the provisions of Section 134(3)(m) ofthe Companies Act 2013 read with the Companies (Accounts) Rules 2014 regardingConservation of Energy Technology Absorption and Foreign Exchange Earnings and Outgo isattached as "Annexure C" to this report.
RISK MANAGEMENT POLICY:
Information on the development and implementation of a Risk ManagementPolicy for the Company including identification therein of elements of risk which in theopinion of the Board may threaten the existence of the Company is given in the CorporateGovernance Report.
VIGIL MECHANISM / WHISTLE BLOWER POLICY:
In accordance with Section 177(9) and (10) of the Companies Act 2013the Company has established a Whistle Blower Policy and Vigil Mechanism. The policy isavailable on the Company's website athttp://www.elandapparel.com/whistle-blower-policy.pdf
CORPORATE SOCIAL RESPONSIBILITY:
As the Company does not fall under any of the threshold limits givenunder the provisions of Section 135 of the Companies Act 2013 the compliances under CSRare not applicable to the Company.
PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES:
The Company does not have any employee drawing remuneration above thelimits mentioned in Section 197(12) of the Companies Act 2013 read with Rules 5(2) and5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014as amended from time to time the details of the same is attached in "AnnexureE" to this report.
INFORMATION UNDER THE SEXUAL HARRASSMENT OF WOMEN AT WORKPLACE(PREVENTION PROHIBITION AND REDRESSAL) ACT 2013:
The Company has zero tolerance for sexual harassment at workplace andhas adopted a policy against sexual harassment in line with the provisions of SexualHarassment of Women at Workplace (Prevention Prohibition and Redressal) Act 2013 and therules framed thereunder. The Company already has an Internal Complaints Committee butshall be reconstituted on account of some resignations.
During the financial year 2017 2018 the Company has notreceived any complaints on sexual harassment and hence no complaints remain pending as of31st March 2018.
REPORT ON PERFORMANCE OF SUBSIDIARIES ASSOCIATES AND JOINT VENTURECOMPANIES
During the year under review your Company did not have any subsidiaryassociate and joint venture company
SIGNIFICANT & MATERIAL ORDERS PASSED BY THE REGULATORS &COURTS.
There were no penalties orders passed during the year.
INTERNAL CONTROL SYSTEMS & THEIR ADEQUACY:
The Company has an internal control system commensurate with the sizescale and complexity of its operations. This ensures that all transactions are authorizedrecorded and reported correctly and assets are safeguarded and protected against lossfrom unauthorized use or disposition. Your Company has adequate internal controls for itsbusiness processes across departments to ensure efficient operations compliance withinternal policies applicable laws and regulations protection of resources and assets andappropriate reporting of financial transactions.
The Company has Internal Audit function which is empowered to examinethe adequacy and compliance with policies plans and statutory requirements. It comprisesof experienced professionals who conduct regular audits across the Company's operations.The Company has also appointed a firm of Chartered Accountants as Internal Auditors whoreviews the various functions of the Company thoroughly and report to the Audit Committee.During the year under review the Risk Management Committee of the Company had reviewedthe new requirement of Internal Control over Financial Reporting ("ICOFR") andfinalized the detailed analysis of key processes and these were presented for review bythe Statutory Auditors. The control mechanism and the process of testing of controls werediscussed with the Statutory Auditors. The Statutory Auditors have submitted their reporton the Internal Financial Controls which forms an integral part of this Report.
The adequacy of the same has been reported by the Statutory Auditors ofyour Company in their report as required under the Companies (Auditor's Report) Order2003.
Your Company considers its Human Resources as the key to achieve itsobjectives. Keeping this in view your Company takes utmost care to attract and retainquality employees. The employees are sufficiently empowered and such work environmentpropels them to achieve higher levels of performance. The constant commitment of theemployees is the driving force behind the Company's vision. Your Company appreciates thespirit of its dedicated employees.
In the Annual General Meeting (AGM) held on 30th September 2016Deloitte Haskins & Sells LLP Chartered Accountants Mumbai having Firm RegistrationNo.117366W/W-100018 have been appointed Statutory Auditors of the Company for a period of5 years. Ratification of appointment of Statutory Auditors is being sought from theMembers of the Company at the ensuing AGM.
They have also confirmed their compliance pursuant to Regulation 33 (1)(d) of the Listing Regulations 2015 in respect of "Peer Review Certificate"issued by the Peer Review Board of ICAI.
Further the report of the Statutory Auditors along with notes toSchedules is enclosed to this report.
There are no qualifications reservations or adverse remarks made byDeloitte Haskins & Sells LLP Chartered Accountants Mumbai Statutory Auditors of theCompany in their report for the financial year ended 31st March 2018. The StatutoryAuditors have not reported any incident of fraud to the Audit Committee or to the Board ofthe Company in the year under review.
Pursuant to the provisions of Section 204 of the Companies Act 2013and the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 theCompany has appointed M/s. Shanu Mata & Associates a firm of Company Secretaries inPractice to undertake the Secretarial Audit of the Company. The Secretarial Audit Reportis attached herewith as "Annexure D".
The Secretarial Auditors have pointed out some observations in the
Secretarial Audit Report and the Company's response to the same is asbelow:
RECONCILIATION OF SHARE CAPITAL AUDIT:
In compliance of circular no D&CC/FITTC/CIR-16/2002 dated 31stDecember 2002 further amended by Circular No. CIR/ MRD/DP/30/2010 dated 6th September2010 issued by the Securities and Exchange Board of India ("SEBI")Reconciliation of Share Capital Audit has been carried out at the specified intervals by aPracticing Company Secretary and have been submitted to the Stock Exchanges where theCompany is listed within due dates.
DISCLOSURE UNDER SECTION 43(a)(ii) OF THE COMPANIES ACT 2013:
The Company has not issued any shares with differential rights andhence no information as per provisions of Section 43(a)(ii) of the Act read with Rule 4(4)of the Companies (Share Capital and Debenture) Rules 2014 is furnished
DISCLOSURE UNDER SECTION 54(1)(d) OF THE COMPANIES ACT 2013
The Company has not issued any sweat equity shares during the yearunder review and hence no information as per provisions of Section 54(1)(d) of the Actread with Rule 8(13) of the Companies (Share Capital and Debenture) Rules 2014 isfurnished.
DISCLOSURE UNDER SECTION 62(1)(b) OF THE COMPANIES ACT 2013
The Company has not issued any equity shares under Employees StockOption Scheme during the year under review and hence no information as per provisions ofSection 62(1)(b) of the Act read with Rule 12(9) of the Companies (Share Capital andDebenture) Rules 2014 is furnished.
DISCLOSURE UNDER SECTION 67(3) OF THE COMPANIES ACT 2013
During the year under review there were no instances of non-exercisingof voting rights in respect of shares purchased directly by employees under a schemepursuant to Section 67(3) of the Act read with Rule 16(4) of Companies (Share Capital andDebentures) Rules 2014 is furnished.
APPRECIATION / ACKNOWLEDGEMENT:
Your Directors wish to place on record their appreciation and expresstheir gratitude for the contribution made by the employees at all levels but for whosehard work and support your Company's achievements would not have been possible. TheBoard takes this opportunity to express its gratitude for the valuable assistance andco-operation extended by Government Authorities Banks Corporate Debt Restructuring (CDR)Cell Financial Institutions Vendors Customers Advisors and other business partners.
Date: 10 August 2018 Place: Mumbai