Your Directors have great pleasure in presenting the 24th Annual Report together withaudited statement of accounts for the year ended 31st March 2019.
Summary of your Company's financial performance both standalone and consolidated forthe year ended March 31 2019 is tabulated below:
(Rs in Millions)
|PARTICULARS ||Year Ending 31st March 2019 ||Year Ending 31st March 2018 |
|Sales (net of excise) and other income ||7618.91 ||7496.72 |
|Less Expenses : |
|Cost of Materials Consumed ||3919.68 ||3520.13 |
|Purchase of Stock in Trade ||3.34 ||3.43 |
|Change in Inventories of FG/WIP/Stock in trade ||-186.82 ||227.05 |
|Employee Benefit Expense ||918.84 ||893.05 |
|Other Expenses ||1235.96 ||1398.57 |
|Total Expenses ||5890.99 ||6042.23 |
|Profit before Interest Depreciation Tax & Amortisation ||1727.92 ||1454.49 |
|Less: - Interest ||833.23 ||283.14 |
|- Depreciation ||1040.48 ||866.16 |
|- Extra Ordinary Item ||-830.01 ||19.36 |
|Proft/Loss before Tax ||-145.79 ||285.83 |
|Less: Provision for Deffered Tax ||-169.94 ||-109.57 |
|Proft/Loss After Tax (A) ||480.74 ||176.26 |
|Amount B/F from previous year (B) ||-838.89 ||-1015.14 |
|Profit/Loss after tax available for appropriations (A+B) ||-358.15 ||-838.88 |
|Balance carried forward to Balance Sheet ||-358.15 ||-838.88 |
OPERATIONS AND BUSINESS PERFORMANCE
During the financial year 2018-19 the Company has achieved a turnover of Rs7244.27Millions against the turnover of Rs 7312.97 Millions during financial year 2017-18. TheCompany has achieved Net profit of Rs 485.16 Millions in 2018-19 against profit ofRs163.61 Millions in 2017-18. The Company's export has increased to '5163.96 Millions in2018-19 as compared to Rs 5025.28 Millions in 2017-18. There has been no change in thenature of business of the company during the year under review. Kindly refer to ManagementDiscussion & Analysis & Corporate Governance Report which forms part of thisreport.
CONSOLIDATED FINANCIAL PERFORMANCE
Your company recorded a consolidated turnover of Rs 7566.02 Millions during 2018-19against the turnover of Rs 7654.83 Millions during 2017-18. In consolidated terms theCompany earned a Net Profit of '388.82 Millions during 2018-19 against profit of '206.52Millions
in 2017-18. The Consolidated financial figures includes the respective financialfigures of the company's three subsidiaries and two associate companies. As required underthe provisions of the Companies Act 2013 and SEBI (LODR) Regulations 2015 AuditedConsolidated Financial Statements form part of the Annual Report and the same are annexedto this Report.
INDIAN ACCOUNTING STANDARDS
The financial statements for the year ended on 31st March 2019 has been prepared inaccordance with the Indian Accounting Standards (Ind AS) as per the Companies (IndianAccounting Standards) Rules 2015 and the Companies (Indian Accounting Standards)Amendment Rules 2016 notified under section 133 of Companies Act 2013 and other relevantprovisions of the Act. The estimates and judgments relating to the Financial Statementsare made on a prudent basis so as to reflect in a true and fair manner the form andsubstance of transactions and reasonably present the Company's state of affairs profitsand cash flows for the year ended 31st March 2019.
The Notes to the Financial Statements adequately covers the Audited Statements andforms an integral part of this Report.
STATE OF AFFAIRS OF THE COMPANY
The state of affairs of the Company is presented as part of the Management Discussion& Analysis Report in a separate section forming part of this report as required underthe SEBI (Listing Obligations and Disclosure Requirement) Regulations 2015.
The main business of your Company is manufacturing Pharmaceutical Products. We arepresently in both domestic and export markets. In view of the scenario described in themanagement discussions your Company is expected to grow with wide range of products andmanufacturing expertise barring unforeseen circumstances.
DIRECTORS & KEY MANAGERIAL PERSONNEL
The Board of the Company was restructured on 23/04/2019 wherein a total of 6 Directorsstepped down from the position of the Directors of the Company and the size of the Boardwas reduced from 12 to 6 Directors. Sh. S.R. Mehta Chairman Dr. G. Munjal
Director Dr. V R. Mehta Director Dr. J. K. Kakkar Independent Director Dr. AshwaniVig-Independent Director and Sh. Jagvir Singh Ahluwalia-Independent Director stepped downfrom the Board of the Company. Sh. N.R. Munjal was appointed as the Chairman of theCompany w.e.f 23.04.2019 & Ms. Neerja Chathley was appointed as the Independent WomenDirector w.e.f 10.05.2019. Now at present the Board of the Company Consists of Sh.N.R.Munjal Chairman and the Managing Director Sh. Himanshu Jain Joint ManagingDirector Sh. Rishav Mehta Executive Director Sh. S.PSharma- Indpependent Director Sh.Prabhat Khurana- Independent Director & Ms. Neerja Chathley-Independent WomenDirector. The Chairman of the Company is a Executive Promoter Director.The composition ofthe Board is in conformity with the provisions of the Companies Act 2013 and Regulation17 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015.
During the period under review Sh. S.V. Singh Nominee Director ceased to be member ofthe Board w.e.f. 17th October 2018 and Ms. Poonam Maini-Independent Woman Director ceasedto be Director w.e.f. 11th February 2019.
The present Board would like to express its deed sense of appreciation for the valuableservices rendered by all the Directors who have ceased to be members of the Board duringtheir respective tenures as member of the Board.
The Company has received necessary declaration from all the Independent Directors underSection 149(7) of the Companies Act 2013 confirming that they meet the criteria ofindependence as laid down in Section 149(6) of the Companies Act 2013 and the ListingRegulations.
Three of the Non-Executive Director of the company viz Sh. S.R. Mehta Dr. Gopal Munjal& Dr. V.R. Mehta become disqualified on 04/04/2019 u/s 164 of the Companies Act 2013in Ind-Swift Limited the Group Company. These Directors however ceased to be member ofthe Board w.e.f. 23/04/2019.
Pursuant to Section 149 152 and other applicable provisions of the Companies Act2013 in the ensuing AGM of the Company Sh. Rishav Mehta Director retire by rotation andbeing eligible offers himself for reappointment.
Details and brief resume of the Directors seeking reappointment/appointments requiredby Regulation 26 (4) and 36 (3) of the Securities and Exchange Board of India (ListingObligations and Disclosure Requirements) Regulations 2015 ('Listing Regulations') and asrequired under Secretarial Standards - 2 on General Meetings issued by "The Instituteof Company Secretaries of India" are furnished in the Notice convening the AnnualGeneral Meeting forming part of the Annual Report.
a) Key Managerial Personnel
Mr. N.R.Munjal Chairman and Managing Director Mr. Himanshu Jain Joint ManagingDirector Mr. Rishav Mehta Executive Director Mr. Gagan Aggarwal Chief FinancialOfficer (nominated w.e.f. 29.09.2018) and Mr. Pardeep Verma AVP-Corporate Affairs &Company Secretary are the Key Managerial Personnel of the Company.
b) Relationship/Transaction of NonExecutive Directors with the Company
The Non-Executive Directors of the Company had no pecuniary relationship ortransactions with the Company other than taking sitting fees and reimbursement ofexpenses incurred by them to attend meetings of the Company.
c) Number of Meetings of the Board
During the year Eleven Board meetings were held on
02.05.2018 08.05.2018 30.05.2018 13.06.2018 25.07.2018
14.08.2018 24.09.2018 29.09.2018 14.11.2018 16.01.2019 & 11.02.2019. Thedetails regarding the meetings are given in the Corporate Governance Report.
d) Performance evaluation of the Board its Committees and Individual Directors
Pursuant to applicable provisions of the Companies Act 2013 and SEBI (LODR)Regulations 2015 the Board in consultation with its Nomination & RemunerationCommittee has formulated a framework containing inter-alia the criteria for performanceevaluation of the entire Board of the Company its Committees and Individual Directorsincluding Independent Directors.
The Independent Directors had met separately without the presence of Non-IndependentDirectors and the members of management and discussed
inter-alia the performance of non- Independent Directors and Board as a whole and theperformance of the Chairman of the Company after taking into consideration the views ofexecutive and NonExecutive Directors.
The Nomination and Remuneration Committee has also carried out evaluation of everyDirector's performance. The performance evaluation of all the Independent Directors havebeen done by the entire Board excluding the Director being evaluated. On the basis ofperformance evaluation done by the Board it shall be determined whether to extend orcontinue their term of appointment whenever the respective term expires.
The Directors expressed their satisfaction with the evaluation process.
e) Familiarization Programme
The details of programmes for familiarization of Independent Directors with theCompany their roles rights responsibilities in the Company nature of the industry inwhich the Company operates the business model and related matters are posted on thewebsite of the Company at https://www . indswiftlabs.com/storage/2018/07/Familiarisation_Programme_for_Independent Directors.pdf
DIRECTORS RESPONSIBILITY STATEMENT
To the best of their knowledge and belief and according to the information andexplanations obtained by them your Directors make the following statements in terms ofSection 134(3)(c) of the Companies Act 2013:
a) that in the preparation of the annual financial statements for the year ended March31 2019 the applicable accounting standards have been followed along with properexplanation relating to material departures if any;
b) that such accounting policies as mentioned in Notes to the Financial Statements havebeen selected and applied consistently and judgement and estimates have been made that arereasonable and prudent so as to give a true and fair view of the state of affairs of theCompany as at March 31 2019 and of the profit of the Company for the year ended on thatdate;
c) 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 and detecting fraud and otherirregularities;
d) that the annual financial statements have been prepared on a going concern basis;
e) that proper internal financial controls were in place and that the financialcontrols were adequate and were operating effectively.
f) that systems to ensure compliance with the provisions of all applicable laws were inplace and were adequate and operating effectively.
VIGIL MECHANISM/ WHISTLE BLOWER POLICY
In compliance with the provisions of Section 177(9) of the Companies Act 2013 read withRule 7 of the Companies (Meetings of Board and its Powers) Rules 2014 and SEBI (LODR)Regulations 2015 your Company has in place a 'Whistleblower Policy' which provides anopportunity to the directors and employees to raise concerns about unethical and improperpractices or any other wrongful conduct in or in relation to the Company. The details ofthe Whistleblower Policy are stated in the Corporate Governance Report and the said Policyhas been uploaded on the Company's website www.indswiftlabs.com .
SUBSIDIARIES JOINT VENTURES & ASSOCIATE COMPANIES
As on 31.03.2019 your Company had 3 Subsidiaries and 2 associate companies. The USsubsidiary of the Company viz. Ind-Swift Laboratories Inc. achieved net sales ofUSD6878721 and recorded a net Profit of USD75511 as on 31.12.2018. The SingaporeSubsidiary Viz. Meteoric Life Sciences PTE Ltd. has no sales during 01.11.2017 to31.10.2018. There is no significant transaction in the Company's Dubai Subsidiary viz.Ind- Swift Middle East FZE during the period under review.
Pursuant to the first proviso to Section 129(3) of the Companies Act 2013 and Rules 5and 8(1) of the Companies (Accounts) Rules 2014 the salient features of the financialstatements performance and financial position of each subsidiary and a joint venture isgiven in Form AOC - 1 as Annexure-I to this report. The Company has framed a policy fordetermining material subsidiaries which has been uploaded on the Company's website.
In view of inadequacy of profits the Board does not recommend any Dividend for theFinancial Year 2018-19.
The Board of Directors has decided to retain the entire amount of profit in the Profit& Loss Account and not to transfer any amount to the General Reserve.
INVESTOR EDUCATION AND PROTECTION FUND
Pursuant to the applicable provisions of the Companies Act 2013 read with the IEPFAuthority (Accounting Audit Transfer and Refund) Rules 2016 ('The Rules') all unpaidor unclaimed dividends are transferred to Investor Education and Protection Fund (IEPF)established by the Central Government after the completion of seven years. Furtheraccording to the rules the shares in respect of which dividend has not been paid orclaimed by the shareholders for seven consecutive years or more shall also be transferredto the demat account created by the IEPF Authority. Accordingly the Company hastransferred the unclaimed and unpaid Dividends for the financial year 2010-11 to IEPF.Further the corresponding shares have been transferred as per the requirements of IEPFrules details of which are provided on the Company website www.indswiftlabs.com .
The aggregate amount of fixed deposits outstanding as on 31st March 2019 was ?21.72crores approx. (previous year '31.84 crores).
The Hon'ble Company Law Board vide its order No.CP27/01/2013 dated 30th September 2013has granted extension of time in repayment of deposits. Now the Company is makingrepayment to the fixed deposit holders in terms of the aforesaid order of Hon'ble CLB.
DETAILS IN RESPECT OF FRAUDS REPORTED BY AUDITORS OTHER THAN THOSE WHICH ARE REPORTABLETO THE CENTRAL GOVERNMENT
The Statutory Auditors Cost Auditors or Secretarial Auditors of the Company have notreported any frauds to the Audit Committee or to the Board of Directors
under Section 143(12) of the Companies Act 2013 including rules made thereunder.
RELATED PARTY TRANSACTIONS DISCLOSURE UNDER THE COMPANIES ACT 2013
All related party transactions entered into during the financial year were on an arm'slength basis and in the ordinary course of business. No related party transaction was inconflict with the interest of the Company. Material related party transactions wereentered into by the Company only with its subsidiaries. No materially significant relatedparty transaction was made by the Company with the Key Managerial Personnel. As prescribedby Section 134(3)(h) of the Companies Act 2013 and Rule 8(2) of the Companies (Accounts)Rules 2014 particulars of related party transactions are given in Form AOC-2 as"Annexure-H" to this Report. The policy on Related Party Transactions asapproved by the Board has been uploaded on the Company's website www.indswiftlabs.com .
RELATED PARTY TRANSACTIONS DISCLOSURE UNDER SEBI (LODR) REGULATIONS 2015
The necessary Related Party Disclosures as required under Schedule V Part - A of SEBI(LODR) Regulations 2015 are given in Note XXVIII of the Standalone and ConsolidatedFinancial Statements.
DISCLOSURE OF TRANSACTIONS WITH PROMOTER/ PROMOTER GROUP
As per Schedule V of the LODR Regulations 2015 every listed Company shall disclose thetransactions with any person or entity belonging to the promoter/ promoter group whichholds 10% or more shareholding in the listed entity.
As on 31st March 2019 M/s Essix Biosciences Limited and M/s Ind Swift Limited beingthe Promoter entities are holding 26.97% and 19.97% respectively of total equity of theCompany. The details of all the transactions with Essix Biosciences Limited and Ind SwiftLimited are already given in Form AOC-2 forming part of this Annual Report.
Even though the provision of Regulation 21 of the SEBI (LODR) Regulations 2015regarding constitution
of Risk Management Committee are not applicable on the Company the Board hasconstituted a Risk Management Committee. The details of the Committee and its terms ofreference are set out in the Corporate Governance Report.
The Company's Risk Management Policy is available on Company's Website i.e.www.indswiftlabs.com and the weblink of the same is https://www.indswiftlabs .com/storage/2018/07/Risk_Management_Policy.pdf
CHANGE IN CAPITAL STRUCTURE AND LISTING OF SHARES
The paid up Equity Share Capital of the Company as on March 31 2019 was '4756.91Lakhs. The Company's shares are listed on the National Stock Exchange of India Limited(NSE) and Bombay Stock Exchange Limited (BSE) and are actively traded. The Company has notissued any shares with differential voting rights or sweat Equity during the year. Thedetails of the allotments made by the Company during the year is as under:
a) Employee Stock Option Scheme
During the year 519989 options were exercised by the employees after vesting.Accordingly the Company has made the allotment of 519989 equity shares on 24thSeptember 2018 against the options exercised by the employees.
During the financial year 2018-19 there has been no change in the Employees StockOption Plan (Employee Incentive Scheme 2014) of the Company. Further it is confirmedthat the ESOP Scheme of the Company is in compliance with SEBI (Share Based EmployeeBenefits) Regulations 2014.
The applicable disclosures as stipulated under Regulation 14 of SEBI (Share BasedEmployee Benefits) Regulations 2014 and rule 12(9) of Companies (Share Capital andDebentures) Rules 2014 with regard to Employees Stock Option Plan of the Company aregiven as Annexure III.
b) Non Convertible Debentures (NCDs) issue
During the Financial Year 2018-19 the Company has issued 4245 Secured listed ratedRedeemable Non-Convertible Debentures (NCDs) of a face value of '1000000/- (Rupees TenLakhs) each of the aggregate nominal value of '4245000000/- (Rupee Four Hundred TwentyFour Crores and Fifty Lakhs only) to Edelweiss Asset Reconstruction Company Limited("EARC") to settle/discharge the secured debt through infusion of fresh fundsand for meeting the cash flow requirement of Company.
c) Optionally Convertible Debentures (OCDs) issue
On 25th July 2018 the Company has issued 11517670 Optionally ConvertibleDebentures (OCDs) of face value of '10/- each at an issue price of '65.50 per OCDincluding a premium of '55.50 per OCD for an aggregate sum of Rs 75.44 crores to ECSpecial Situations Fund and Edelweiss India Special Situations Fund II respectively tosettle/ discharge the secured debt through infusion of fresh funds and for meeting thecash flow requirement of Company.
d) Preferential issue of 1771949 Equity shares
The Board of Directors of the Company in their meeting held on 25th July 2018 hasallotted 1771949 Equity Shares of '10/- each at a premium '55.50/- to Edelweiss AssetReconstruction Company Limited ("EARC") for the part of the Unsustainable debtportion of Restructured Rupee Loan to be converted into Equity Shares and the Sustainabledebt portion of Restructured Rupee Loan to be payable as per the agreed terms andconditions as settled between the Company and the EARC. The Shareholder approval for thesame was taken at Extra-Ordinary General Meeting held on June 9 2018.
UTILISATION OF PROCEEDS OF THE NCD/ OCD ISSUE
The funds raised from the NCD & OCD issue has been utilized for the purposes forwhich it were raised that is settlement of the dues of the State Bank of India Bank ofBaroda Phoenix ARC Edelweiss Canara Bank IDBI SBI (Halcyon Life Sciences) & SCLowy (partially).
MANAGEMENT DISCUSSION AND ANALYSIS REPORT
Management's Discussion and Analysis Report for the year under review as stipulatedunder Regulation 34 (2) (e) of the SEBI (LODR) Regulations 2015 is presented in aseparate section forming part of the Annual Report.
PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS UNDER SECTION 186 OF THE COMPANIES ACT2013
Pursuant to the provisions of Section 134(3)(g) of the Companies Act 2013 (Act)particulars of loans/ guarantees/ investments/securities given under Section 186 of theAct are given in the related notes to the Financial Statements forming part of the AnnualReport.
EXTRACT OF ANNUAL RETURN
Pursuant to the provisions of Section 92 (3) of the Companies Act 2013 extract of theAnnual Return in Form MGT-9 is given in 'Annexure-IV' to this Report and is also availableon the website of the Company viz www.indswiftlabs.com .
POLICY ON DIRECTORS' APPOINTMENT AND REMUNERATION
The Company has a policy on Directors' Appointment & Remuneration. In compliancewith the provisions of Sections 134(3)(e) and 178 of the Companies Act 2013 andRegulation 19 read with Part D of Schedule II of the SEBI (LODR) Regulations 2015 theNomination & Remuneration Committee:
i) has formulated criteria for determining qualifications positive attributes andindependence of a director and recommends to the Board Policy relating to remunerationfor directors KMP and other employees;
ii) has formulated the evaluation criteria for performance evaluation of independentdirectors and the Board;
iii) has devised a policy on Board diversity;
iv) identifies persons who are qualified to become directors or may be appointed inSenior Management in accordance with criteria laid down and recommend to the Board theirappointment and removal;
v) recommends to the Board whether to extend or continue the term of appointment of theindependent director on the basis of the report of performance evaluation of independentdirectors.
CORPORATE SOCIAL RESPONSIBILITY
Even though the provisions of Companies Act 2013 regarding Corporate SocialResponsibility have become applicable on the Company from the FY 2018-19 yet the Companyhas been over the years pursuing as part of its corporate philosophy an unwritten CSRpolicy voluntarily which goes much beyond mere philanthropic gestures and integratesinterest welfare and aspirations of the community with those of the Company itself in anenvironment of partnership for inclusive development. Except for the CSR expenditureincurred voluntarily the Company was not required to spend any amount on CSR during2018-19.
ENVIRONMENT/POLLUTION CONTROL HEALTH AND SAFETY
The Company is conscious of the importance of environmentally clean and safeoperations. The Company's policy requires conduct of operations in such a manner so as toensure safety of all concerned compliances of environmental regulations and preservationof natural resources.
RESEARCH & DEVELOPMENT AND QUALITY CONTROL
The activities of R&D consists of improvement in the processes of existing productsand to develop new products. The Quality Control is the strength of the Company. All rawmaterials and finished products pass through stringent quality checks for better results.
The Company has taken adequate insurance policies for its assets against the possiblerisks like fire flood public liability marine etc. The Company has not taken Directorsand Officers Liability insurance policy as it is applicable on top 500 listed Companies ason 31st March 2019 and your Company does not fulfill that criteria.
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNING AND OUTGO
The particulars as prescribed under 134(3)(m) of the Companies Act 2013 read withRule 8 of The Companies (Accounts) Rules 2014 relating to conservation of energytechnology absorption and foreign exchange earnings and outgo are given in Annexure-V.
COMMITTEES OF THE BOARD
The Company's Board has constituted the following Committees prescribed under theCompanies Act and the LODR Regulations 2015:-
a) Audit Committee
b) Stakeholders Relationship Committee
c) Risk Management Committee
d) Nomination and Remuneration Committee
e) Corporate Social Responsibility Committee
f) Compensation Committee
g) Sub-Committee of the Board
The details of the Composition of the Committees their role and terms of reference aregiven in Corporate Governance Report.
Pursuant to the provisions of Section 139 of the Companies Act 2013 and the rulesframed thereunderthe Company in its Annual General Meeting held on 26th day of September2017 had appointed M/s Avishkar Singhal & Associates Chartered Accountants (Firm Reg.No. 017362N) as the Statutory Auditors of the Company for a period of Five Consecutiveyears from the conclusion of the 22nd Annual general Meeting till the conclusion of the27th Annual General Meeting of the Company to be held in the year 2022. The CompaniesAmendment Act 2017 has dispensed the ratification of auditors appointment at every AnnualGeneral Meeting . Accordingly the Ordinary Business Agenda item relating to theratification of the statutory Auditors appointment is not placed in the AGM notice.
The Auditor's Report for the Financial Year 2018-19 does not contain any qualificationreservation or adverse remark. With regard to emphasis of matter contained in theAuditors' Report the Board is of the view that the same are self explanatory.
COST AUDITORS AND THEIR REPORT
M/s. V. Kumar & Associates Cost Accountants have been duly appointed as CostAuditors of the Company for audit of cost accounting records which are covered under theCost Audit Rules for current financial year ending March 31 2020.
As required by Section 148 of the Companies Act 2013 necessary resolution has beenincluded in the Notice convening the Annual General Meeting seeking ratification by theMembers to the remuneration proposed to be paid to the Cost Auditors for the financialyear ending March 31 2020.
The Cost Audit Reports are required to be filed within 180 days from the end of thefinancial year. The Cost Audit Reports for the financial year 2017-18 issued by M/s V.Kumar and Associates Cost Auditors was filed with Ministry of Corporate Affairs withinthe stipulated time. The Cost Audit Reports for the financial year ended March 31 2019will be filed within the prescribed period.
Further in compliance to the Companies (Accounts) Amendment Rules 2018 dated 31stJuly 2018 this is to confirm that maintenance of cost records as specified by the CentralGovernment under sub-section (1) of section 148 of the Companies Act 2013 is required bythe Company and accordingly such accounts and records are made and maintained by theCompany.
SECRETARIAL AUDITORS AND THEIR REPORT
Mr. Vishal Arora Practicing Company Secretary was appointed as Secretarial Auditors ofthe Company for the financial year 2018-19 pursuant to Section 204 of the Companies Act2013. The Secretarial Audit Report submitted by them in the prescribed form MR- 3 isattached as Annexure-VI and forms part of this report. There are no qualifications orobservations or other remarks of the secretarial auditors in the secretrial audit reportissued by them for the financial year 2018 -19. However in the directorsqualification/disqualification certificate as issued by them they have observed that thethree directors of the company were disqualified on 04.04.2019 u/s 164 of the CompaniesAct 2013. The said disqualification relates to Ind-Swift Limited . As required under theAct these Directors have ceased to be member of the Board w.e.f. 23/04/2019.
M/s Jain and Associates were appointed as Internal Auditors of the Company upto 31stMarch 2019. The Board has however approved the re-appointment of M/s Jain &Associates Chartered Accountants as Internal Auditors of the Company for the FY 2019-20as well. They will conduct the Internal Audit of the Company as required under Section 138of the Companies Act and their reports shall be reviewed by the Audit committee and theBoard of Directors.
INTERNAL COMPLAINTS COMMITTEE
The Company has complied with all the provisions relating to the constitution ofInternal Complaints Committee under the Sexual Harassment of Women at Workplace(Prevention Prohibition and Redressal) Act 2013.
During the year the Committee has not received any complaint related to Sexualharassment.
INTERNAL FINANCIAL CONTROL
Your Company has an effective internal control and risk mitigation system which areconstantly assessed and strengthened with new/revised standard operating procedures. TheCompany's internal control system commensurate with its size scale and complexities ofits operations. The main thrust of internal audit is to test and review controlsappraisal of risks and business processes besides bench marking controls with bestpractices in the industry.
The Audit Committee actively reviews the adequacy and effectiveness of the internalcontrol systems and suggests improvements to strengthen the same. The Company has a robustManagement Information System which is an integral part of the control mechanism.
The Audit Committee Board of Directors Statutory Auditors and the Business heads areperiodically apprised of the internal audit findings and corrective actions taken. Auditplays a key role in providing assurance to the Board of Directors. Significant auditobservations and corrective actions taken by the management are presented to the AuditCommittee of the Board. To maintain its objectivity and independence the Internal Auditfunction reports to the Chairman of the Audit Committee
A Report on Corporate Governance forms part of this Annual Report. The Auditors'certificate certifying compliance with the conditions of Corporate Governance underRegulation 34(3) read with Schedule V of the SEBI (LODR) Regulations 2015 is annexed asAnnexure-VII to this Report.
Your Company is of the firm opinion that efficiency of its employees plays a key rolein achieving set goals and building a competitive work environment. The Company regularlyconducts various programs at different levels so as to ensure that a vibrant and motivatedwork-force leads to achievement of the defined goals. Employee relations continued to theharmonious and cordial at all levels and in all the units of the Company.
The Company is committed to provide a protective environment at workplace for all itswomen employees. To ensure that every woman employee is treated with dignity and respectand as mandated under "The Sexual Harassment of Women at Workplace (PreventionProhibition and Redressal) Act 2013" and in its full compliance the Company hasconstituted "Internal Complaints Committee" for prevention of sexual harassmentof its women employees. During the year the Committee has not received any complaintrelated to Sexual harassment.
PARTICULARS OF EMPLOYEES
Particulars of remuneration of employees required to be furnished pursuant to theprovisions of Section 197 (12) of the Companies Act 2013 (Act) read with Rule 5(1) ofthe Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 are givenas Annexure-VIII to this Report. Particulars of remuneration of employees required to befurnished in terms of Rules 5(2) and 5(3) of the said Rules forms part of this Reportwhich shall be provided to Members upon written request pursuant to the second proviso ofRule 5. Particulars of remuneration of employees are available for inspection by Membersat the Registered office of the Company during business hours on all working days up tothe date of the forthcoming AGM.
SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS
During the Financial Year 2018-19 no significant/ material order was passed by any ofthe Regulators/ Courts.
CHANGE IN THE NATURE OF BUSINESS
There is no change in the nature of business of the Company.
MATERIAL CHANGES AND COMMITMENTS
AFFECTING THE FINANCIAL POSITION OF THE COMPANY.
There is no material change and commitments affecting the financial position of thecompany that occurred between the end of the financial year of the company i.e. March 312019 and the date of the Directors Report i.e. 10th August 2019.
REGISTRAR AND SHARE TRANSFER AGENT
M/s Alankit Assignments Ltd. are the Registrar and Share Transfer Agent of the Companyfor the Physical as well as Demat shares Optionally Convertible Debentures andNon-Convertible Debentures of the Company. The members are requested to contact theRegistrar directly for any of their requirements.
The Annual Listing fee for the year under review has been paid to The BSE Limited andThe National Stock Exchange of India Ltd.
In terms of the Listing Regulations the Certificate duly signed by Sh. NavrattanMunjal Chairman and Sh. Gagan Aggarwal Chief Financial Officer (CFO) of the Company wasplaced before the Board of Directors along with the annual financial statements for theyear ended on 31st March 2019 at its meeting held on 29th May 2019.
The Company has complied with the applicable Secretarial Standards issued by theInstitute of Company Secretaries of India.
Your Directors thank all the employees for their sincere efforts active involvementand devoted services rendered. Your Directors thank the shareholders of the Company forthe confidence reposed in the Management of the Company. Your Directors place on recordtheir gratitude to the Customers Suppliers Company's Bankers and Financial Institutionsfor their support and cooperation during the year under review.
|On behalf of the Board of Directors |
|Place: Chandigarh ||N.R. Munjal |
|Dated: 10th August 2019 ||Chairman |