FOR THE FINANCIAL YEAR ENDED 31ST MARCH 2019
TO THE SHAREHOLDERS
Your Directors have pleasure in presenting the Thirty Seventh (37th)Directors' Report of your Company along with the financial statements for the financialyear ended 31st March 2019.
1. Certain key aspects of your Company's performance during the financial year ended 31stMarch 2019 as compared to the previous financial year are summarized below:
(Rs. in Lakhs)
|Particulars ||Standalone ||Consolidated |
| ||Year ended ||Year ended ||Year ended ||Year ended |
| ||31.03.2019 ||31.03.2018 ||31.03.2019 ||31.03.2018 |
|Income for the year ||6811.61 ||34436.21 ||8265.17 ||35557.16 |
|Expense for the year ||10719.23 ||33456.42 ||12152.43 ||34600.03 |
|Profit before Tax and Interest ||(3834.33) ||979.79 ||(3842.66) ||957.13 |
|Current Tax ||- ||213.89 ||- ||213.89 |
|Provisions for Taxation/ Deferred Tax ||0.5521 ||(1.17) ||2.03 ||9.78 |
|Net Profit / (Loss) for the Current Year ||(3858.29) ||1166.27 ||(3868.09) ||1132.65 |
|Minority Interest & Profit from Associate Company ||- ||- ||(3.39) ||9.98 |
|Net Profit After Tax ||(3858.29) ||1166.27 ||(3864.70) ||1142.63 |
|Transfer to General Reserves ||- ||- ||- ||- |
|Balance carried to Balance Sheet ||(3858.29) ||1166.27 ||(3864.70) ||1142.63 |
2. DIVIDEND AND RESERVES:
Your Directors has not recommend any dividend for the financial year ended 31stMarch 2019 as the Company has suffered loss these financial year.
No amount was transferred to General Reserve during the year
INVESTOR EDUCATION AND PROTECTION FUND (IEPF)
In accordance with the applicable provisions of Companies Act 2013 read with InvestorEducation and Protection Fund (Accounting Audit Transfer and Refund ) Rules 2016("IEPF Rules") all unclaimed dividends are required to be transferred by theCompany to the IEPF after completion of seven (7) years. Further according to IEPFRules the shares on which dividend has not been claimed by the shareholders for seven (7)consecutive years or more shall be transferred to the demat account of the IEPF Authority.The details relating to amount of dividend transferred to the IEPF and correspondingshares on which dividends were unclaimed for seven (7) consecutive years are provided onthe website of the Company www.garnetint.com.
3. SHARE CAPITAL
During the year under review there was no change in the Authorized or Paid up Capitalof the Company.
Hence the Paid up Capital of the Company which was stood at Rs. 195286560 consistingof 19528656 fully paid equity shares of the Company on 31st March 2019.
4. OVERVIEW OF OPERATIONS:
During the year under review on Standalone basis your Company recorded a total incomeof Rs. 6811.61 lakhs as compared to last year's total Income of Rs. 34436.21 lakhs andNet Loss of Rs. 3858.29 lakhs as compared to last year's net profit of Rs. Rs. 1166.27Lakhs.
Management Discussion and Analysis (MDA) as stipulated under the Listing Regulations ispresented in a separate section forming part of this Annual Report. It provides detailsabout the overall industry structure global and domestic economic scenarios developmentsin business operations/ performance of the Company's various businesses viz. decorativebusiness international operations industrial and home improvement business internalcontrols and their adequacy risk management systems and other material developmentsduring the financial year 2018-19.
5. EXTRACT OF ANNUAL RETURN
The Extract of Annual Return as provided under Section 92(3) of the Companies Act 2013("the Act") and as prescribed in Form No. MGT-9 of the Companies (Management andAdministration) Rules 2014 is appended as Annexure I to the Annual Report.
6. NUMBER OF MEETINGS OF THE BOARD
The Board met 7 (Seven) times in Financial Year 2018-19 (FY 2018-19) viz. on 30thMay 2018 28th June 2018 13th August 2018 14thNovember 2018 11th January 2019 12th February 2019 29thMarch 2019.
The details of attendance of Director with respect to above meetings are as follows:
|Name of Director ||No. of Meeting eligible to Attend ||No. of Meeting Attended |
|Mr. Suresh Gaggar ||7 ||7 |
|Mr. Ramakant Gaggar ||7 ||7 |
|*Mrs. Manju Maheshwari ||3 ||3 |
|*Dr. Jaswantsingh Patil ||6 ||6 |
|Mrs. Sandhya Lotlikar ||3 ||3 |
|Mr. Sharad Rathi ||7 ||7 |
* Dr. Jaswantsingh Patil was appointed on 28th June 2018 and Mrs. SandhyaLotlikar was appointed on 11th January 2019. Mrs. Manju Maheshwari resignedfrom the Board w.e.f 14th September 2018
7. DIRECTORS' RESPONSIBILITY STATEMENT
Your Directors hereby confirm that:
i. In the preparation of the annual accounts for 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 a true andfair view of the state of affairs of the Company at 31st March 2019 and of theloss of the Company for that period.
iii. The Directors have taken proper and sufficient care for 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.
iv. The Directors have prepared the annual accounts for financial year ended 31stMarch 2019 on a going concern' basis.
v. The Directors have laid down internal financial controls to be followed by theCompany and that such internal financial controls are adequate and have been operatingefficiently.
vi. The Directors have devised proper systems to ensure compliance with provisions ofall applicable laws and that such systems were adequate and operating effectively.
8. DECLARATION BY INDEPENDENT DIRECTORS
The Independent Directors of the Company have submitted the declaration of Independenceas required under Section 149(7) of the Act confirming that they meet the criteria ofindependence under Section 149(6) of the Act and Regulation
16 (1)(b) of the Securities Exchange board of India (Listing Obligations and DisclosureRequirements) Regulations 2015 (Listing Regulations).
9. POLICY ON DIRECTORS' APPOINTMENT AND REMUNERATION
The Policy of the Company on Directors' appointment and remuneration including criteriafor determining qualifications positive attributes and any other matters as required tobe provided for the Independence of a Director as per subsection (3) of Section 178 of theAct and Regulation 19 of Listing Regulations is appended as Annexure II to this AnnualReport.
10. PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS UNDER SECTION 186
The details of Loans Guarantees and Investments covered under the provisions ofSection 186 of the Act read with Companies (Meeting of Board and Its Powers) Rules 2014as on 31st March 2019 are given in the notes to the Financial Statementsforming part of this Annual report.
11. PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES
During the financial year 2018-19 your Company has not entered into transactions withrelated parties as defined under section 2(76) of the Act read with the Companies(Specification and Definitions Details) Rules 2014 and Rules made thereunder andRegulation 23 of the Listing Regulations. All the transactions with the Related Partiesare at arm's length basis and these transactions are not of material in nature as perSection188 of the Companies Act 2013 read with Rule 15 of the Companies (Meeting of Boardand its Powers) Rules 2014. The related party transactions are placed before the AuditCommittee as also the Board for approval. The Form AOC- 2 of the Companies (Accounts)Rules 2014 is set out as Annexure III to this Annual Report.
The details of party transactions as required under Accounting Standard-18 are set outin notes to accounts to the Financial Statements forming part of this Annual Report.
The Policy on Related Party Transaction may be accessed on the Company's website at thelink: http://garnetint.com/ mdocs-posts/related-party-transactions-policy/.
12. MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY
There have been no material changes and commitments affecting the financial position ofthe Company which have occurred between the end of the financial year of the Company towhich the financial statements relate and the date of the report.
13. PARTICULARS REGARDING CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGNEXCHANGE
EARNINGS AND OUTGO
The particulars in respect of conservation of energy technology absorption and foreignexchange earnings and outgo as required under Section 134(3)(m) of the Act read with theCompanies (Accounts) Rules 2014 is given in Annexure IV to this Annual Report.
14. BUSINESS RISK MANAGEMENT
The Board of Directors of the Company has constituted a Risk Management Committee toframe implement and monitor the risk management plan for the Company.
The Company has a robust Risk Management framework to identify evaluate business risksand opportunities. This framework seeks to create transparency minimize adverse impact onthe business objectives and enhance the Company's competitive advantage.
The business risk framework defines the risk identification and its management approachacross the enterprise at various levels including documentation and reporting. Theframework helps in identifying risks trend exposure and potential impact analysis on aCompany's business.
15. CORPORATE SOCIAL RESPONSIBILITY
The Board has constituted a Corporate Social Responsibility (CSR) Committee inaccordance with Section 135 of the Act. Your Company's Annual Report on the CSR activitiesundertaken during the financial year ended 31st March 2019 in accordance withSection 135 of the Act and Companies (Corporate Social Responsibility Policy) Rules 2014is annexed to this report as Annexure V.
16. VIGIL MECHANISM
The Company has adopted a Vigil Mechanism and Whistle Blower Policy for Directors andEmployees in compliance with the provisions of Section 177(10) of the Act and Regulation22 of the Listing Regulations to report genuine concerns and to provide for adequatesafeguards against victimization of persons who may use such mechanism. The said policy isalso available on the Company's website:http://garnetint.com/mdocs-posts/vigil-mechanisim-policy/
17. POLICY ON PREVENTION OF SEXUAL HARASSMENT ATWORKPLACE
The Company has formulated a Policy on Prevention of Sexual Harassment at Workplace forprevention prohibition and redressal of sexual harassment at workplace in accordance withthe Sexual Harassment of Women at Workplace (Prevention Prohibition and Redressal) Act2013 (hereinafter referred to as "Prevention of Sexual Harassment Act").Internal Complaints Committees have also been set up to redress any such complaintsreceived. The Company is committed to providing a safe and conducive work environment toall of its employees and associates. The Company periodically conducts sessions foremployees across the organization to build awareness about the Policy and the provisionsof Prevention of Sexual Harassment Act.
Complaints of sexual harassment received during the financial year 2018-19 by theCompany were investigated in accordance with the procedures prescribed and adequate stepswere taken to resolve them.
18. ANNUAL EVALUATION OF PERFORMANCE OF THE BOARD
Pursuant to the provisions of the Act and Regulation 17 of the Listing Regulationsthe Board has carried out an annual evaluation of its own performance performance of theDirectors as well as the evaluation of the working of its Committees.
The Nomination and Remuneration Committee has defined the evaluation criteria for theBoard its Committees and Directors.
The Board's functioning was evaluated on various aspects including inter alia degreeof fulfilment of key responsibilities Board structure and composition establishment anddelineation of responsibilities to various Committees effectiveness of Board processesinformation and functioning.
The Committees of the Board were evaluated after taking inputs from the Committeemembers on the basis of criteria such as degree of fulfillment of key responsibilitiesadequacy of Committee composition and effectiveness of meetings.
The Board and the Nomination and Remuneration Committee reviewed the performance of theindividual directors on aspects such as attendance and contribution at Board/ CommitteeMeetings and guidance/support to the management outside Board/ Committee Meetings. Inaddition the Chairman was also evaluated on key aspects of his role including settingthe strategic agenda of the Board encouraging active engagement by all Board members.
The performance evaluation of the Independent Directors was carried out by the entireBoard excluding the Director being evaluated. The performance evaluation of the Chairmanand the Non Independent Directors was carried out by the Independent Directors who alsoreviewed the performance of the Board as a whole.
In a separate meeting of independent directors performance of non-independentdirectors performance of the board as a whole and performance of the chairman wasevaluated taking into account the views of executive directors and non-executivedirectors.
19. SUBSIDIARY COMPANIES
The Company is having one material Subsidiary i.e. Sukartik Clothing Private Limited.Further Company has also formulated policy for determining material subsidiary and thesame is available on Company's website and the same may be accessed at the link:http://garnetint.com/mdocs-posts/policy-for-determining-material-subsidiary/
Further during the year Garnet Valorem Capital Ventures Private Limited was ceased tobe the wholly owned subsidiary of the Company on 21st January 2019.
Pursuant to provisions of Section 129(3) of the Act a statement containing salientfeatures of the financial statement of the Subsidiary company in Form AOC-1 is attached tothe a part of this Report as Annexure- VI.
20. DETAILS RELATING TO DEPOSITS COVERED UNDER CHAPTER V OF THE COMPANIES ACT 2013
The Company has neither accepted nor renewed any deposits during the Financial Year2018-19 in terms of Chapter V of the Act.
21. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS
During the year under review the Company has received the Certificate of Registrationfrom Reserve Bank of India on 05th December 2018.
Apart from the above mentioned information there are no significant material orderspassed by the Regulators/Courts which would impact the going concern status of the Companyand its future operations.
22. INTERNAL CONTROL WITH REFERENCE TO FINANCIAL STATEMENTS
The Company has in place adequate internal financial control with reference tofinancial statements. The Company has adopted accounting policies which are in line withthe Accounting Standards prescribed in the Companies (Accounting Standards) Rules 2006that continue to apply under Section 133 and other applicable provisions if any of theAct read with Rule 7 of the Companies (Accounts) Rules 2014 and relevant provisions ofthe Act to the extent applicable. These are in accordance with generally acceptedaccounting principles in India.
The Company in preparing its financial statements makes judgments and estimates basedon sound policies and uses external agencies to verify/validate them as and whenappropriate. The basis of such judgments and estimates are also approved by the StatutoryAuditors and Audit Committee.
The Internal Auditor evaluates the efficacy and adequacy of internal control systemaccounting procedures and policies adopted by the Company for efficient conduct of itsbusiness adherence to Company's policies safeguarding of Company's assets preventionand detection of frauds and errors and timely preparation of reliable financialinformation etc. Based on the report of internal audit function process owners undertakecorrective action in their respective areas and thereby strengthen the controls.Significant audit observations and corrective actions thereon are presented to the AuditCommittee of the Board.
23. DIRECTORS AND KEY MANAGERIAL PERSONNEL
In accordance with the provisions of the Section 149 152 and 160 of the Act Mr.Ramakant Gaggar (DIN: 01019838) Director of the Company will retire by rotation at theensuing Annual General Meeting and being eligible offers himself for re-appointment.
The Board of Directors at its meeting held on 28th June 2018 has appointedDr. Jaswantsingh Patil as an Additional Independent Director. Mrs. Manju Maheshwariwomen director of the Company has resigned from the Company w.e.f 14thSeptember 2018 and Mrs. Sandhya Lotlikar was appointed on 11th January 2019on the Board of the Company.
Board places on record its appreciation for the assistance and guidance provided byMrs. Manju Maheshwari during his tenure as Director of the Company.
The Board of Director at its meeting held on 29th May 2019 subject toapproval of the Board has appointed Mr. Vishnu Kanth Bhangadia as Additional Director ofthe Company in the category of Independent Director. Further at the same meeting thedesignation of Mr. Sharad Rathi has been changed from Independent Director of the Companyto Non Independent Director pursuant to declaration given by the Director.
1. Statutory Auditor
M/s. MVK Associates Chartered Accountants Mumbai (ICAI Registration No. 120222W)have appointed as an Auditor of the Company from 35th Annual General meeting ofthe Company till the Conclusion of the 40th Annual General Meeting of theCompany pursuant to provisions of the section 139 141 and other applicable provisions ofthe Act and rules issued thereunder (including all statutory modification and amendmentmade from time to time).
The Statutory Auditors of the Company MVK Associates has resigned from the Companyw.e.f 16th August 2019. The Company propose to appoint M/s. B.M Gattani &Co. Chartered Accountants (Firms Registration No. 113536W) as Statutory Auditor of theCompany to fill the Casual Vacancy caused by the resignation of the MVK associates.
The Board of Directors has also proposed the Appointment of M/s. B.M Gattani & Co.Chartered Accountants (Firms Registration No. 113536W) to the shareholders of theCompany as statutory Auditor for a period of 5 years i.e. till the conclusion of the 42ndAnnual General Meeting of the Company.
Auditors report for the financial year ended 31st March 2019 forms part ofthis Annual Report. Following mentioned remarks are given by the Auditors of the Companyin their Audit Report for the year ended 31st March 2019:
a. Company has an amount of Rs. 23.13 lakhs remaining to be spent on CSR as requiredunder section 135 of the Companies Act 2013
b. Subsidiary of the Company has not made provision for employee benefit as perAccounting Standard 15 which deals with "Employee Benefits".
Management Reply for the Remark given by Statutory Auditor:
The Management has already started making CSR expenses from the year 01st April 2019.Further the Company is in talk with management of its material subsidiary so that adequateprovisions for the employee benefit shall be made.
Further the Audit Committee and Board of Directors of the Company recommends to themembers of the Company for ratification of appointment of statutory auditor of the Companyfrom this ensuing Annual General Meeting till the conclusion of the 40th Annual GeneralMeeting of the Company.
2. Secretarial Auditor
Pursuant to the provisions of Section 204 of the Act and The Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014 the Board of Directors of the Companyhad appointed M/s Siddharth Sharma & Associates Practicing Company Secretaries toundertake the audit of the secretarial records for the financial year 2018 - 19.
The Secretarial Audit Report for the financial year ended 31st March 2019under Companies Act 2013 read with Rules made thereunder and Regulation 24A of theListing Regulations (including any statutory modification(s) or re-enactment(s) thereoffor the time being in force) is set out in the as Annexure VII (A) to this Annual Report.
M/s Kamlesh Jain & Associates were appointed as Secretarial Auditor of theMaterial Subsidiary of the Company. The secretarial Audit report of material subsidiary isalso annexed as Annexure VII (B).
There are no qualifications reservations or adverse remarks or disclaimers made bySecretarial Auditor of the Company in his secretarial audit report.
25. CORPORATE GOVERNANCE
Pursuant to Listing Regulations the Management Discussion & Analysis Report andCorporate Governance Report together with Certificate from Practicing CharteredAccountant on compliance with the conditions of Corporate Governance as lay down forms apart of this Annual Report.
26. AUDIT COMMITTEE OF THE COMPANY:
The Company's Audit Committee comprises the following Directors:
1. Mr. Vishnu Kanth Bhangadia (Chairman);
2. Mr. Ramakant Gaggar;
3. Mrs. Sandhya Lotlikar
4. Dr. Jaswantsingh Patil
The composition of the Audit Committee is in compliance with the requirements ofSection 177 of the Act and Regulation 18 of the Listing Regulations.
All members of the Audit Committee are financially literate and have experience infinancial management.
All the recommendations made by the Audit Committee were accepted by the Board ofDirectors of the Company.
27. PARTICULARS OF EMPLOYEES
In terms of the provisions of Section 197(12) of the Act read with Rules 5(2) and 5(3)of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 astatement showing the names and other particulars of the employees drawing remuneration inexcess of the limits top 10 employees in terms of remuneration drawn and otherDisclosures pertaining to remuneration are provided in Annexure VIII to this AnnualReport.
Having regard to the provisions of the proviso to Section 136(1) of the Act and asadvised the Annual Report excluding the afore said information is being sent to themembers of the Company the said information is available for inspection at the registeredoffice of the Company during working hours and any member interested in obtaining suchinformation may write to the Company Secretary and the same will be furnished on request.
28. OTHER DISCLOSURES
a. The Company has complied with Secretarial Standards issued by the Institute ofCompany Secretaries of India on Meetings of the Board of Directors and General Meetings;
b. The Managing Director of the Company has not received any remuneration or commissionfrom any of the subsidiary companies;
c. None of the Auditors of the Company have reported any fraud as specified under thesecond proviso of Section 143 (12) of the Companies Act 2013 (including any statutorymodification(s) or re-enactment(s) thereof for the time being in force);
d. The Company does not have any scheme or provision of money for the purchase of itsown shares by employees/ Directors or by trustees for the benefit of employees/ Directors;and
e. The Company has not issued equity shares with differential rights as to dividendvoting or otherwise.
Your Directors express their sincere appreciation of the co-operation received fromshareholders bankers and other business constituents during the year under review. YourDirectors also wish to place on record their deep sense of appreciation for the commitmentdisplayed by all executives officers and staff resulting in the successful performanceof the Company during the year.
| ||For and on behalf of the Board of Directors |
| ||Suresh Gaggar |
| ||Chairman |
| ||DIN: 00599561 |
|Mumbai16th August 2019 || |
|Registered Office: || |
|901 Raheja Chambers Nariman Point Mumbai 400021 || |
|CIN :L74110MH1995PLC093448 || |
|EmailID:email@example.com || |
|Website:www.garnetint.com || |
|Tel No :91-022-22820714 || |