Your directors are pleased to present the Twenty Eight (28th) Annual Report and theAudited Financial Statements for the financial year ended 31st March 2017.
1. Financial Highlights
The highlights of the financial results of the Company for the year ended 31st March2017 is summarized below
| || ||( in Lacs) |
|Particulars ||2016-2017 ||2015-2016 |
|Sales Interest and other receipts ||10945 ||10452 |
|Gross Profit before financial cost & Depreciation & Exceptional Items ||409 ||633 |
|Financial Cost ||256 ||243 |
|Depreciation ||111 ||98 |
|Exceptional Items ||143 ||- |
|Profit for the year ||185 ||292 |
|Less: Tax Expenses ||106 ||73 |
|Balance ||291 ||219 |
|Balance brought forward from last year ||1007 ||788 |
|Balance Carried to Balance Sheet ||1298 ||1007 |
2. Operational Highlights & Future Prospects
Your Directors had in the last Report informed the Members that the Company hascompleted its modernization-cum-expansion program at a cost of Rs.1340 Lacs. The saidmodernization program has resulted in saving in cost of production.
The net result of the current Financial Year was positive mainly for Dairy Division.During the year under consideration the Company's turnover and other receipts stands atRs.10945 Lacs as against Rs.10452 Lacs in the previous year. The year ended with a profitof Rs.291 Lacs after considering interest depreciation and adjustment for deferred tax asagainst profit of Rs.219 Lacs in the previous year.
In Dairy division the company has processed 26809 Kl of Milk and 1010 Mt of S.N.F./Fat(including 11133 Kl of Milk on job work basis) as against 22549 Kl of milk and 75 Mt ofS.N.F/Fat in the previous year (Including 14468 Kl on job work basis) and has achieved aturnover of Rs.7831 Lacs as against Rs.4174 Lacs in the previous year. The turnoverincludes sale value of manufactured products trading goods as well as processing receiptsfor job work done on behalf of other established parties. It may be stated that in orderto encash the opportunity the Company has also traded in liquid milk besidesmanufacturing pure ghee SMP and processing milk on behalf of other parties. Demand fordairy products was partly subdued in the flush season due to possible demonetizationeffect.
The company expects the dairy operations to be favorable in the forthcoming year.However due to effect of demonetization as well as expected introduction of Goods andService Tax w.e.f. 01/07/2017 it is expected that the 1st half of the current year willsee a tough time even for Dairy Industry and its operations may be subdued. However theCompany is optimistic that the 2nd half of the current year will be quite favorable inview of the fact that various legislation and measures taken by the Government forbetterment of economy will settle by 2nd half of the year. The Company expects to achievesatisfactory performance by processing milk for self as well as on behalf of other reputedparties and also by trading in Dairy products including milk.
In the last report your Directors had informed that the Soya operations includingrefinery was closed in November 2015 due to continuous disparity in the last few years.However the economics of Soya processing was visible by the start of Soya season in theyear under review and as such the Company once again started processing soybean inNovember 2016. However the parity in Soya operations did not continue for long and thecompany had to once again close the Soyabean Plant by February 2017. The Company maythink of restarting its Soya operations in future only when the said operations becomeprofitable. During the year the Company had processed 9386 MT of Soyabean seed as against15738 MT in the previous year. The Soya Division recorded a turnover of Rs.3114 lacs asagainst Rs.6278 lacs in the previous year.
3. Share Capital
The company's application to BSE/CDSL for listing/admission of 578887 shares issued tothe shareholders of Premier Industries (India) Ltd (Transferor company) in terms of BIFRorder dt 15/01/2014 is pending and the company expects to get their approval shortly.
Due to financial prudency no dividend is declared.
Shri Rajesh Agrawal (DIN:00107009 ) is liable to retire by rotation at the ensuingAnnual General Meeting and being eligible offers himself for re-appointment.
Shri Rajesh Agrawal Chairman & Managing Director of the company seeks forre-appointment as chairman & managing Director
The board on the recommendation of Nomination and Remuneration Committee has considerreappointment of him as chairman and managing director for further period of five yearsfrom 01/09/2017 to 31/08/2022 subject to approval of shareholder in the ensuing AnnualGeneral Meeting.
Shri Tarachand Jain was appointed as Additional director on the board of the companywith effect form 1st of June 2017 and eligible for appointment as Independent director ofthe company subject to approval of shareholders of the company.
During the year under review your Company has not accepted any fixed deposits underSection 73 of the Companies Act 2013.
7. Fixed Assets
During the year the company has added Fixed Assets of Rs.27.89 Lacs (7.82 lacs capitalwork in progress carried from earlier year). The Fixed Assets are adequately insured.
8. Management Discussion and Analysis
The Management`s Discussion and Analysis of operations for the year under review asstipulated under regulation34 (2) (e) of the Listing Regulations 2015 with the stockexchanges is provided in annexure attached to this report.
9. E-Voting Facility
The company has already provided E-Voting facilities to the shareholders of thecompany.
10. Appointment of Cost Auditor
As per the Companies (Cost Records and Audit) Rules 2014 the Company has appointed M/s.M. Goyal & Co. Cost Accountants Jaipur (Raj.) as the Cost Auditors for thepurpose of conduct of Cost Audit of the Cost
Accounting Records of the Company for the Financial Year 2017-2018.
11. Directors' Responsibility Statement
Pursuant to Section 134(5) of the Companies Act 2013 the Board of Directors to thebest of their knowledge and ability confirm that
i. In the preparation of the annual accounts the applicable accounting standards havebeen followed and there are no material departures;
ii. They have selected such accounting policies and applied them consistently and madejudgments and estimates that are reasonable and prudent so as to give a true and fair viewof the state of affairs of the Company at the end of the financial year and of the profitof the Company for that period;
iii. They have taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of the Act for safeguarding theassets of the Company and for preventing and detecting fraud and other irregularities;
iv. They have prepared the annual accounts on a going concern basis;
v. They have laid down internal financial controls to be followed by the Company andsuch internal financial controls are adequate and operating effectively;
vi. They have devised proper systems to ensure compliance with the provisions of allapplicable laws and that such systems were adequate and operating effectively.
Based on the framework of internal financial controls and compliance systemsestablished and maintained by the Company work performed by the internal statutory andsecretarial auditors and external consultants and the reviews performed by management andthe relevant Board Committees including the Audit Committee the Board is of the opinionthat the Company's internal financial controls were adequate and effective during thefinancial year 2016-17.
12. Number of Meetings of the Board
Five meetings of the board were held during the year. For details of the meetings ofthe board please refer to the corporate governance report which forms part of thisreport.
13. Board evaluation
The Board of Directors has carried out an Annual evaluation of its own performanceBoard committees and individual directors pursuant to the provisions of the Act and thecorporate governance requirements as prescribed by Securities and Exchange Board of India("SEBI") laid down in Schedule V of the (Listing Regulations and DisclosureRequirements) Regulation
The performance of the Board was evaluated by the Board after seeking inputs from allthe Directors on the basis of the criteria such as the Board composition and structureeffectiveness of Board processes information and functioning etc.
The performance of the Committees was evaluated by the Board after seeking inputs fromthe committee members on the basis of the criteria such as the composition of committeeseffectiveness of committee meetings etc.
The Board and the Nomination and Remuneration Committee ("NRC") reviewed theperformance of the individual directors on the basis of the criteria such as thecontribution of the individual director to the Board and committee meetings likepreparedness on the issues to be discussed meaningful and constructive contribution andinputs in meetings etc. In addition the Chairman was also evaluated on the key aspectsof his role.
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. The same was discussed in the board meeting that followed the meeting of theindependent Directors at which the performance of the Board its committees andindividual directors was also discussed.
14. Audit committee
The details pertaining to composition of audit committee are included in the CorporateGovernance Report which forms part of this report.
Under Section 139 of the Indian Companies Act 2013 and the Rules made there under itis mandatory to rotate the statutory auditor on completion of the maximum term permittedunder the said section. The audit committee of the company has proposed and on August 282017the Board of Directors of the Company has recommended the appointment Sunil Bandi& Co. Chartered Accountants Indore (M.P.)
As per the provisions of section 139(2) of the Company's Act 2013 tenure of existingStatutory Auditors M/S. M. Mehta & Co. Chartered Accountants Indore (M.P.) ends onensuring Annual General Meeting and Company requires rotating appointment of StatutoryAuditors.
Accordingly the Audit Committee and the Board of Directors respectively at theirmeeting held on 28th August 2017 have recommended the Appointment of Sunil Bandi &Co. Chartered Accountants Indore (M.P.) as Statutory Auditor of the Company to holdoffice from conclusion of this Annual General Meeting till the conclusion of the 33rdAnnual General Meeting.
The Company has received a certificate from Sunil Bandi
& Co to the effect that their appointment if made would be within the limitsprescribed under Section 141 of The Companies Act 2013. The Board of Directors recommendsto the shareholders the appointment of Sunil Bandi & Co as Statutory Auditors of theCompany.
16. Auditors' report
Your Directors would like to provide following clarification on points mentioned in theAuditors Report.
A. Under Qualified Opinion
The Company has not provided for liabilities for Minimum Alternate Tax (MAT) underIncome Tax Act 1961 as the company of the opinion that-
a) That the Board for Industrial and Financial Reconstruction (BIFR) vide its orderdated 15/01/2014 had ordered for merger of Premier Industries (India) Ltd.(TransferorCompany) with Girdharilal Sugar And Allied Industries Limited (Transferee Company) withall its Assets and Liabilities.
b) That the BIFR had provided in its order several reliefs and concessions to themerged Company (GSAIL). According to clause-16.7 of Relief & Concessions BIFR hasdirected CBDT to consider "to exempt/grant relief to the company form the provisionsof Section 41(1) 4572(3) 43B 7980 read with 139 115JB and provisions of Chapter-XVIIof the Income Tax Act."
c) That the Company in the meanwhile has approached the concerned Income Taxauthorities for granting aforesaid relief under various Sections/Chapter of income TaxAct.
B. Under Emphasis on matters
1) As regards interest on loans given to related party your Directors would like toclarify that the said related party is a sick company since 2002 registered with BIFR asCase No.449/2002 and are facing severe liquidity crunch. The said related Company hadapproached to our Company for waiver of interest for this financial year and for earlierfinancial year. Your Directors in their meeting had considered the request and agreed forwaiver thereof in view of precarious liquidity crunch in the said related company
2) Various unpaid/undisputed liabilities relate to the transferor company i.e. PremierIndustries (I) Ltd. which was sick industrial company since 1999. The Company is of theopinion that it will enjoy waiver of interest on payment of those liabilities in view ofits BIFR status as well as Relief Undertaking status which is likely to be granted byState Government of M.P in due course in terms of BIFR order.
3) As regards non deposition of unclaimed Debenture amount your Directors would like tostate that BIFR vide its order dt 15/01/2014 under clause 16.1.2 (Debenture Holders) hasgiven direction "to exempt the Company from the provisions of section 205 C of
The Companies Act 1956 (now section 125 of The Companies Act 2013). BIFR has furtherdeferred repayment of Debenture Holders liabilities for 3 years commencing fromF.Y.2014-15 till 2016-17.
4) The company has provided its liabilities towards Gratuity based on the calculationprovided under the Gratuity Act as in previous years. Actuarial Valuation of gratuityliability will be completed in the current year 2017-18 and differences if any will beadjusted accordingly.
5) As regards provision of Industrial Promotion Assistance of Rs. 1.43 crore receivablefrom Govt. of M.P. your Directors would like to state that on the strength of approvalletter dated 21/03/2013 issued by State Govt. of M.P. while sanctioning merger in terms ofIndustrial Policy 2010 the Company has since incurred Capital Expenditure and henceprovided a sum of Rs. 14265678/- as VAT Incentive receivable in terms of provisions ofthe said Policy.
17. Secretarial auditors' report
Secretarial auditors' report does not contain any major qualifications reservations oradverse remarks. The company is complying with all necessary formalities and furtherimprovements are being made as an annexure which forms part of this report.
18. Particulars of loans guarantees and investments
The particulars of loans guarantees and investments have been disclosed in thefinancial statements.
19. Transactions with related parties
The transaction with related parties falls under the scope of Section 188(1) of theAct. Information on transactions with related parties pursuant to Section 134(3)(h) of theAct read with rule 8(2) of the Companies (Accounts) Rules 2014 are given in the FinancialStatement.
20. Extract of annual return
As provided under Section 92(3) of the Act the extract of annual return is given inAnnexure II in the prescribed Form MGT-9 which forms part of this report.
21. Particulars of employees
The Company has not paid any remuneration attracting the provisions of the CompaniesAct 2013 under Section 197 of the Act read with rule 5(1) of the Companies (Appointmentand Remuneration of Managerial Personnel) Rules 2014.
22. Disclosure requirements
As per Regulation 36 of the listing obligation entered into with the stock exchangescorporate governance report with practicing company secretary's report thereon andmanagement discussion and analysis are attached which form part of this report.
The Company has formulated a Whistle Blower Policy to provide Vigil Mechanism foremployees including Directors of the Company to report genuine concerns. The provisions ofthis policy are in line with the provisions of the Section 177(9) of the Act.
23. Code of conduct
The Board has laid down a code of conduct for all Board members and Senior Managementpersonnel of the Company. Board members and senior management personnel have affirmedcompliance with the said code of conduct for the financial year 2016-17.
The equity shares of the Company are listed with Bombay Stock Exchange and efforts arebeing made to lift the suspension of trading in NSE. The Shares of the company is admittedat CDSL and efforts are being made to get it admitted at NSDL.
25. Conservation of Energy Research and Development Technology Absorption Foreignexchange Earning and outgo
The details regarding Energy Conservation Technology Absorption Foreign ExchangeEarning and outgo as required by section 134 (3m) of the Companies Act 2013 read with theCompanies (Accounts) Rules 2014 are given in Annexure-1 and forms part of this report.
26. Corporate Governance
The Company has been practicing the principles of good Corporate Governance during theyear. As required under Regulation 27 of the Listing Obligation with the Stock Exchangesthe report on Management Discussion and Analysis Corporate Governance as well as theAuditors certificate on Corporate Governance form part of the Annual Report. Your Companyis also following the Secretarial Standard norms issued by the Institute of CompanySecretaries of India (ICSI).
Your Directors place on record their sincere appreciation for significant contributionmade by employees through their dedication hard work and commitment.
Your Directors also acknowledge the support extended by the Bankers Governmentagencies Shareholders and investors at large and look forward to receive the same supportfor our endeavor to grow consistently.
| ||FOR AND ON BEHALF OF THE BOARD |
|Place: DEWAS (M.P.) ||RAJESH AGRAWAL |
|Date: 28th August 2017 ||CHAIRMAN & MANAGING DIRECTOR |