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Hindusthan National Glass & Industries Ltd.

BSE: 515145 Sector: Industrials
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OPEN 34.80
52-Week high 53.20
52-Week low 23.30
Mkt Cap.(Rs cr) 300
Buy Price 33.90
Buy Qty 200.00
Sell Price 34.20
Sell Qty 200.00
OPEN 34.80
CLOSE 34.55
52-Week high 53.20
52-Week low 23.30
Mkt Cap.(Rs cr) 300
Buy Price 33.90
Buy Qty 200.00
Sell Price 34.20
Sell Qty 200.00

Hindusthan National Glass & Industries Ltd. (HINDNATGLS) - Director Report

Company director report

Dear Members

We hereby present the Annual Report together with the Audited Accounts of our businessand operations for the financial year ended 31st March 2020.


(Rs in Lakhs)

Particulars For the year ended 31st March 2020 For the year ended 31st March 2019
Gross sales (including excise duty) 228637 239194
Profit before interest depreciation and tax 27852 23839
Interest and finance charges 23317 25257
Profit/Loss before depreciation and tax 4535 (1417)
Depreciation 14846 15853
Exceptional Profit - 9517
Profit/Loss before tax & after exceptional profit (10311) (17270)
Profit/Loss for the year (Before Other Comprehensive Income) (10303) (17295)
Balance brought forward from previous year (94938) (77660)
Amount available for appropriation (100256) (94938)
Balance carried forward to the next year (100256) (94938)

*figures have been regrouped and rounded off.


During the financial year your Company reported total income of Rs 228637 Lakhs inF.Y. 2019-20 compared to Rs 239194 Lakhs in F.Y. 2018-19. Your Company recorded an EBITDAof Rs 27852 Lakhs and a net loss of Rs 10303 Lakhs during the year under review. Duringthe year direct export turnover was Rs 8992 Lakhs compared to Rs 14955 Lakhs for F.Y.2018-19.

The financial position of the Company continues to be under severe stress. Thesituation further deteriorates due to increase in Power & Fuel and Raw Materialcosts. Due to paucity of funds your Company could not do any maintenance of capex andalso fails to meet its debt obligation. Your Company is in discussion with the Lenders andis working on various resolution plans and hope to find out a solution acceptable to allstakeholders.


The spread of COVID-19 has severely impacted businesses around the globe includingIndia. There has been severe disruption to regular business operations due to lock-downdisruption in transportation supply chain and other emergency measures. The Company'soffices are under lockdown since 24th March 2020 and plants are running with curtailedproduction and manpower as per requisite permission from local administration. As a resultthe volumes for the month of Mar'2020 and period upto the Board meeting has been impacted.The Company is monitoring the situation closely and operations are being ramped up in aphased manner taking into account directives from the Government. The management hasconsidered internal and certain external sources of information up to the date of approvalof the financial statements in determining the impact of COVID-19 pandemic on variouselements of its financial statements. The management has used the principles of prudencein applying judgments estimates and assumptions and based on the current estimates themanagement expects to fully recover the carrying amount of inventories trade receivablesinvestments and other assets. The eventual outcome of impact of the global health pandemicmay be different from those estimated as on the date of approval of these financialstatements.


Your Directors do not recommend any dividend for the year ended 2019-20. Furtherduring the year under review no amount was transferred to General Reserve.


The Paid Up Equity Share Capital as at 31st March 2020 stood at 179107130 i.e89553565 equity shares of Rs 2/- each. The Company has not issued shares with differentialvoting rights nor has granted any stock options or sweat equity. As on 31st March 2020none of the Directors of the Company hold instruments convertible into equity shares ofthe Company.

Pursuant to the Regulation 78 of the Securities and Exchange Board of India (Issue ofCapital and Disclosure Requirements) Regulations 2009 Equity Shares allotted toPromoters in F.Y. 2017-18 will be locked in for a period of three years.


As on 31st March 2020 your Company does not have any Subsidiary Company.


Pursuant to the amalgamation of Ace Glass Containers Limited with the Company2141448* shares and 1368872* shares having face value of Rs.10/- each (correspondingto 10707240 shares and 6844360 shares having face value of Rs .2 each) were issued toHNG Trust and Ace Trust respectively. At present HNG Trust & Ace Trust are holding7641600 & 3050000 shares respectively. In terms of an undertaking given to the BSELimited the Company is required to make disclosures pertaining to utilisation ofproceeds of shares allotted to the said Trusts until they are extinguished. EntireShareholding of Ace Trust and 7506850 Shares of HNG Trust has been pledged in complianceof Corrective Action Plan (CAP) approved by the Joint Lenders Forum.

*The Company's shares were sub-divided from Rs 10 per share to Rs 2 per share w.e.f.13th November 2009.


Shri Sanjay Somany (DIN:- 00124538) is the Chairman of the Board of Directors w.e.f.12th August 2017.

During the year under review the shareholders at 73rd Annual General Meeting of theCompany held on 18th September 2019 approved appointment of Shri Amal Chandra Saha(DIN:- 00443348) as the Non-Executive Independent Director of the Company for a period of5 years w.e.f. 18th September 2019 to 17th September 2024.

In accordance with the provisions of Section 152 of the Companies Act 2013 ShriSanjay Somany (DIN:- 00124538) Chairman and Managing Director of the Company retires byrotation at the ensuing 74th Annual General Meeting and being eligible have offeredhimself for re-appointment. Your Directors recommend his re-appointment on the basis ofrecommendations of Nomination and Remuneration Committee.

The Company has received declarations from all the Independent Directors of theCompany confirming that they meet the criteria of Independence as prescribed underSection 149(6) of the Companies Act 2013. Role responsibilities and duties ofIndependent Director are being uploaded on the Company's website at the link TermsofAppointmentofIndependentDirector.pdf

Pursuant to the applicable provisions of the Companies Act 2013 and the SEBI (ListingObligations and Disclosure Requirements) Regulations 2015 a structured questionnaire wasprepared after taking into consideration the various aspects of the Board's functioningcomposition of the Board its Committees culture execution and performance of specificduties obligations and governance. The Company has devised a Policy for performanceevaluation of Independent Directors and Board which include criteria for performanceevaluation of the non-executive directors and executive directors.

The performance evaluation of the Independent Directors Chairman and the NonIndependent Directors were carried out. The Board of Directors expressed theirsatisfaction with the evaluation process on the basis of recommendations from Nominationand Remuneration Committee.

Shri Ratna Kumar Daga (DIN: 0 0 2 27746) Shri Dipankar Chatterji (DIN: 00031256) Smt.Rita Bhimani (DIN: 07106069) & Shri Amal Chandra Saha (DIN: 00443348) are theIndependent Directors of the Company.

The Existing Tenure of Smt. Rita Bhimani (DIN: 07106069) as an Independent WomanDirector of the Company ended on 2nd March2020. The Board considers that her continuedassociation would be of immense benefit to the Company and it is desirable to continue toavail her services as an Independent Director. Accordingly the Board of Directors of theCompany at its meeting held on 11th February 2020(based on the recommendation ofNomination and Remuneration Committee at its meeting dated 11th February 2020) approvedher re-appointment as an Independent Director for another tenue of 5 years w.e.f. 3rdMarch 2020 to 2nd March 2025 in accordance with the provisions of Sections 149 150152 read with Schedule IV and any other applicable provisions of the Act and regulations16(1)(b) 17(1A) and read with other applicable regulations of SEBI (Listing Obligationsand Disclosure Requirements) Regulations 2015 (including any statutory modification(s) orre-enactment thereof for the me being in force) subject to approval of shareholders byway of special resolution at ensuing 74th Annual General Meeting of the Company.

Managerial Remuneration

In reply to our 2 (Two) applications for payment of remuneration exceeding the limitsprovided in Schedule V of Companies Act 2013 pertaining to F.Y. 2015-2016 to F.Y.2017-2018 for Executive Directors namely Shri Sanjy Somany Chairman & ManagingDirector (DIN:- 00124538) and Shri Mukul Somany Vice-Chairman & Managing Director(DIN:- 00124625) the Central Government after taking reference of the Notification No.S.O. 4823 (E) dated 12th September 2018 has abated both of our pending applications videits letter No. SRNG35818194/4/2017-CL-VII and SRNG35820075/4/2017-CL-VII both datedTuesday 9th October 2018. Through such letters the Central Government have also givendirections that the onus of compliance with the provisions of the Companies Act 2013 asamended vide the Companies (Amendment) Act 2017 lies with the Company.

As per opinion received from Central Government Shri Sanjay Somany Chairman &Managing Director (DIN:- 00124538) and Shri Mukul Somany Vice-Chairman & ManagingDirector (DIN:- 00124625) have refunded the excess remuneration received by them undersection 197 read with Schedule V of the Companies Act 2013 in F.Y. 2015-16 F.Y. 2016-17and full remuneration for F.Y. 2017-18 to the Company during the F.Y 2019-20. The Companyduly noted the same.

The following policies of the Company are attached herewith and marked as "AnnexureI”:

A. Nomination & Remuneration Policy.

B. Board Evaluation Policy.

Shri Lalit Lohia was appointed as Company Secretary w.e.f. 5th February 2019 andcontinuing till date.

Shri Bimal Kumar Garodia is acting as Chief Financial Officer of the Company since 26thApril 2008 and continuing till date.

The details of Key Managerial Personnel of the Company are as follows:-

Name of Key Managerial Personnel Designation
1 Shri Sanjay Somany Chairman & Managing Director
2 Shri Mukul Somany Vice Chairman & Managing Director
3 Shri Bimal Kumar Garodia Chief Financial Officer
4 Shri Lalit Lohia Company Secretary


Pursuant to Section 134(5) of the Act the Directors hereby confirm that -

a) In the preparation of the annual accounts for the year ended 31st March 2020 theapplicable Accounting Standards had been followed along with proper explanation relatingto material departures.

b) The Directors have selected such accounting policies and applied them consistentlyand made judgements and estimates that are reasonable and prudent so as to give a trueand fair view of the state of affairs of the Company as at 31st March 2020 and of theloss of the Company for the year ended on that date.

c) The Directors 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.

d) The Directors have prepared the annual accounts on a 'going concern basis'.

e) The Directors have laid down internal financial controls to be followed by theCompany and that such internal financial controls are adequate and are operatingeffectively; and

f) The Directors have devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems are adequate and operating effectively.


Pursuant to Rule 3 of the Investor Education and Protection Fund (Uploading ofinformation regarding unpaid and unclaimed amounts lying with Companies) Rules 2012including any till date amendmentsthe Company has uploaded the details of unpaid andunclaimed amounts lying with it on the Ministry of Corporate Affairs website.

Equity shares in respect of which the dividend for the year 2011-12 remained unclaimedfor seven consecutive years has been transferred to the IEPF Authority in compliance withSection 124 of the Companies Act 2013 read with rule 6 of the Investor Education andProtection Fund (Accounting Audit Transfer and Refund) Rules 2017 after givingindividual notices to concerned Shareholders and advertisements in newspapers.


The Company has been practising the principles of good corporate governance with a viewto achieve transparent accountable and fair management. The Report on CorporateGovernance along with the Certificate of the Auditors M/s. M. Rathi & Co. confirmingthe compliance of Corporate Governance as stipulated in Regulation 34(3) read withSchedule V of the SEBI (Listing Obligations & Disclosures Requirement) Regulations2015 forms an integral part of the Annual Report.

Our Corporate Governance Report for the F.Y. 2019-20 along with Its annexures formspart of this Annual Report.


The contracts/arrangements/transactions entered by the Company during the financialyear with the related parties were in the ordinary course of business and on an arm'slength basis. All the related party transactions are with the approval of the AuditCommittee and are periodically placed before the Board for review. During the year underreview the Company has not entered into any contract/arrangement/transactions withrelated parties which could be considered material in accordance with the policy of theCompany on materiality of related party transactions.

The Policy on materiality of related party transactions and dealing with related partytransactions as approved by the Board may be accessed on the Company's website at thelink


The Corporate Social Responsibility Committee has been formulated and comprises of ShriMukul Somany (Chairman) Shri Sanjay Somany and Smt. Rita Bhimani as members. Since theCompany has suffered losses in the previous financial years as well as in the currentfinancial year no expenditure was incurred on CSR activities.

The CSR Policy may be accessed on the Company's website at the link POLICYONCORPORATESOCIALRESPONSIBILITY.pdf


During the year under review the continuous higher financial leverage and lowerprofitability plagued the financials of the Company. To reduce the leverage Company hasbeen continuously exploring various options for raising fund including equity/debt orenter into joint venture. Earlier the application made by one of the strategic Investorfor entering into a Joint Venture with Company got invalidated by Competition Commissionof India (CCI). However the Company had subsequently discussed with some other new lendersand also approached the existing lenders for extension of One Time Settlement (OTS) as perthe Agreement entered in September' 2018.

On 5th March' 2019 one of the lender had initiated proceedings in National Company LawTribunal (NCLT) Kolkata Bench under section 7 of the Insolvency and Bankruptcy Code2016. However on 2nd April 2019 Hon'ble Supreme Court has quashed the RBI's circular onResolution of Stressed Assets - Revised Framework dated 12th February 2018.

An Application for withdrawal under Rule 11 of the NCLT Rules 2016 on behalf of thesaid lender was filed before the NCLT. The Withdrawal application was taken up for hearingon 30.07.2019 and was allowed by giving permission to withdraw the application withoutprejudice to the right proceed against the Company.

Thereafter the same lender filed fresh application before the National Company LawTribunal (NCLT) Kolkata Bench on 13th August 2019 under section 7 of the Insolvency andBankruptcy Code 2016. The matter was last heard on 17th February 2020. One more lenderhas filed application on 13th January2020. Further due to ongoing pandemic situation nohearing/further hearing has been scheduled so far. The matter being subjudice the Companyhas not given any effect of resolution plan in the financial statements.

The discussion with the Lenders is still going on and the resolution process of thesame is under discussion between the Lenders and the Management of the Company.


Management's Discussion and Analysis under Schedule V read with Regulation 34(3) of theSEBI (Listing Obligations & Disclosures Requirement) Regulations 2015 has beenpresented in a separate section and forms part of this Annual Report.


During the year under review the Company has no subsidiary and/or joint venture and/orassociate Company and accordingly your Company is not required to prepare consolidatedfinancial statements including Form AOC-1 for F.Y. 2019-20.


Risk management is embedded in your Company's operating framework. The Company managesand monitors various risks and uncertainties that can have some adverse impact on theCompany's business. Your Company believes that managing risks helps in maximising returns.Your Company is giving major thrust in developing and strengthening its internal audit sothat risk threat can be mitigated. The Company's approach to address business risks iscomprehensive and includes periodic review mitigating controls and reporting mechanism.

Since your Company is not among top 500 listed companies based on marketcapitalisation as on 31st March 2020 constitution of Risk Management Committee is notrequired in accordance with SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 read with till date amendments.

The Company has a formal Risk Management Policy. The Board of Directors from time totime review the same.


Your Company has a comprehensive and effective internal control and risk mitigationsystem including internal financial control for all the major processes to ensurereliability of financial reporting timely feedback on operational and strategic goalscompliance with policies procedures law and regulations safeguarding of assets andeconomical and efficient use of resources. The Company's internal control system iscommensurate with its size scale and complexities of its operations. The main thrust ofinternal audit is to test and review controls appraisal of risks and business processesbesides benchmarking controls with best practices in the industry.

The Audit Committee of the Board of Directors of the Company actively reviews theadequacy and effectiveness of the Internal Control Systems and suggests improvements. TheCompany has a robust Management Information System (MIS) which is an integral part of thecontrol mechanism.


As per amendments to the Companies Act 2013 and rules made therein and as pernotification dated 7th May 2018 by the Ministry of Corporate Affairs (MCA) ratificationof the Statutory Auditor is no longer required to be passed by shareholders at the ensuingAnnual General Meeting (AGM) and therefore approval of the shareholders is not sought atthe ensuing AGM for our joint Statutory Auditors namely:-

A) M/s. Doshi Chatterjee Bagri & Co. LLP Chartered Accountants (Firm RegistrationNumber 325197E/E300020) who were appointed as the Statutory Auditors of the Company tohold office from the conclusion of 71st Annual General Meeting until the conclusion of the76th Annual General Meeting.

B) M/s. JKVS & Co. (Formerly M/s. Jitendra K. Agarwal & Associates) CharteredAccountants (Firm Registration No. 318086E) who were appointed as the Joint StatutoryAuditor of the Company to hold office from the conclusion of 72nd Annual General Meetinguntil the conclusion of the 77th Annual General Meeting along with the existing StatutoryAuditors M/s. Doshi Chatterjee Bagri & Co. LLP Chartered Accountants

Auditors Report

The para-wise management response to the qualifications / observations made in theIndependent Auditors Report is stated as under:

a) Attention is being drawn to para 3 of the Independent Auditors Report regardingBasis for Qualified Opinion. The clarification of the same is provided in Note No.2.13.8.D of the Accounts.

b) Attention is being drawn to para 4 of the Independent Auditors Report regardingBasis for Qualified Opinion. The clarification of the same is provided in Note No. 2.38 ofthe Accounts. The Company and its promoters are in process regularising the situation. TheCompany has prepared its accounts on going concern basis.

Secretarial Auditor

Pursuant to the provisions of Section 204 of the Companies Act 2013 and the rules madethereunder the Company has appointed Shri Babu Lal Patni Practising Company Secretary toconduct the Secretarial Audit for the financial year 2019-20. The Secretarial Audit forthe financial year ended 31st March 2020 along with self-explanatoryqualifications/observations is annexed herewith and marked as "Annexure II” tothis report.


Audit Committee

The Audit Committee comprises of 3(three) Independent Directors namely Shri Ratna KumarDaga (Chairman and Independent Director) Shri Dipankar Chatterji (Member and IndependentDirector) & Shri Amal Chandra Saha (Member and Independent Director) and 1 (One)Executive Director namely Shri Mukul Somany as member. All the recommendations made bythe Audit Committee were accepted by the Board during the financial year 2019-20.

Presently the composition of the Audit Committee is as follows:

Name Designation
1 Shri Ratna Kumar Daga Chairman
2 Shri Dipankar Chatterji Member
3 Shri Amal Chandra Saha* Member
4 Shri Mukul Somany Member

*Shri. Amal Chandra Saha has been appointed as Audit Committee Member w.e.f 13thAugust 2019.

Vigil Mechanism/Whistle Blower Policy

The Company has a Vigil Mechanism which also incorporates a Whistle Blower Policy forDirectors and Employees to report their concerns about unethical behaviour actual orsuspected fraud or violation of the Company's Code of conduct. Disclosures can be made bya Whistle Blower through an email to the Chairman of the Audit Committee.

The Policy may be accessed on the Company's website at the link

Meetings of the Board

During the year under review 5 (Five) meetings of the Board of Directors were held.The maximum interval between any two meetings did not exceed 120 days as prescribed inthe Companies Act 2013. Details of compositions and other information are provided in theCorporate Governance Report.

Extract of Annual Return (MGT-9)

As required under Section 134(3)(a) of Companies Act 2013 read with till dateamendments the Annual Return(i.e. MGT-9) for Financial Year 2019-20 is put up on theCompany's website and can be accessed at

Particulars of Loans Guarantees or Investment made guarantee given and securitiesprovided.

Particulars of Loans given Investments made Guarantee given and securities providedalong with the purpose for which the Loan or Guarantee or Security is proposed to beutilized by the recipient are provided in the Financial Statements.

Change in nature of Business

During the year under review there has been no change in the nature of business of theCompany.

Remuneration from Subsidiary

Since the Company has no Subsidiary this is not applicable.

Significant or Material Order

No significant or material order was passed by the Regulators or Courts or Tribunalswhich impact the going concern status and Company's operations in future.

Material Changes and Commitments

Due to severe liquidity crunch the Company is not able to meet its debt obligation.

Sexual Harassment

During the year under review no case was reported pursuant to the Sexual Harassment ofWomen at Workplace (Prevention Prohibition and Redressal) Act 2013.

Business Responsibility Reporting

The Business Responsibility Reporting as required by Regulation 34(2) of the SEBI(Listing Obligations & Disclosure Requirement) Regulations 2015 is enclosed herewithand marked as "Annexure IN”.


The Company's shares continue to be listed at the National Stock Exchange of IndiaLimited BSE Limited and The Calcutta Stock Exchange Limited.

The Annual Listing fee for the F.Y. 2020-21 has been paid to all these Exchanges.


In terms of Section 197(12) of the Act read with Rule 5(1) (2) & (3) of theCompanies (Appointment and Remuneration of Managerial Personnel) Rule 2014 a Statementshowing the names and other particulars of the employees drawing remuneration in excess ofthe limits set-out and other details as required in the said rule are provided as "AnnexureIV”.


The statements containing the required particulars under the Act are provided as "AnnexureV” and forms a part of this report.


Your Company takes pride in the commitment competence and dedication shown by itsemployees in all the areas of business. People are the Company's key assets. The focus inF.Y. 2019-20 was on enhancing employee engagement and driving performance excellence toachieve the Company's long term vision. Your Company is consolidating the human resourceoperations and the internal systems to enhance the operations of the Company. The Companycontinued to actively drive the Ethics and Compliance agenda via trainings programmes andemployee engagements focussing on non-retaliation and zero tolerance to non-compliance.HR function is a critical pillar to support the organization's growth and itssustainability in the long run.


Your Directors would like to place on record their appreciation to the employees atall levels for their contribution to the Company's performance but for whose hard workand support your Company's achievements would not have been possible. Your Directors alsowish to thank its customers dealers agents suppliers investors and bankers for theircontinued support and faith reposed in the Company.

For and on behalf of the Board
Sanjay Somany
Place : Kolkata Chairman & Managing Director
Date : 28th May 2020 (DIN: 00124538)