THE JAMSHRI RANJITSINGHJI SPG. & WVG. MILLS CO. LTD.
We present our Annual Report of the Company with the audited statement of accounts forthe year ended 31st March 2018.
1. FINANCIAL RESULTS
| ||2017-18 (Rs.) ||2016-17 (Rs.) |
|Revenue from Operations ||540408391 ||825110793 |
|EBITDA ||(37562006) ||14730991 |
|Finance Cost ||19078269 ||20331723 |
|Depreciation ||9507473 ||9833189 |
|Exceptional items (net) ||- ||- |
|Profit /Loss before Tax ||(66147748) ||(15433922) |
|Less: Provision for Tax ||34599 ||(100000) |
|Profit/(Loss) after Tax ||(66182347) ||(15333922) |
|Other Comprehensive Income/(Loss) ||(351497) ||(190500) |
|Total Comprehensive income ||(66533844) ||(15524422) |
|Balance brought forward ||174005050 ||177316016 |
|Profit/(Loss) dealt with as under ||107471206 ||161791594 |
|Less: IND AS Adjustment ||44906 ||60110 |
|Less: Prior Period Adjustment ||- ||12273566 |
|Surplus/(Deficit) carried to Balance Sheet ||107516112 ||174005050 |
The Company has achieved Revenue from Operations of Rs. 5404.00 lakhs during thefinancial year 2017-18 as against Rs. 8251.10 lakhs in the previous year i.e. decrease of34.50%. It has incurred loss of Rs 665.33 lakhs during the year as against loss of Rs.155.24 lakhs in the previous year. The main reasons for the adverse performance arebriefly analyzed hereunder. Textile industry in general has been adversely impacted bythe demonetarization in November 2016 and introduction of 5% GST on Fabric from 1st July2017. Power-looms units in Bhiwandi Ichhalkaranji Bhilwara Surat and other centresremained crippled for considerably long time resulting into very low off-take anddepressed prices of yarn which used to be the main product of your Company. The Companywas also badly affected and had no option but to cut down its operations and dispose offits products at uneconomic prices. The workers started leaving the job from the month ofNovember 2017 and more than 90% of our workers and staff had left the company by the monthof February 2018. The company has settled their accounts and has paid their dues towardswages salaries leave salaries gratuity PF dues etc in full. The performance of theCompany was also affected by rising price of raw materials and higher electricity andfinance cost. The rising costs couldn't be passed on to the customers due to depressedmarket conditions Presently the company had to stop in-house production of yarn. Thefactory was temporary closed in the month of March 2018. However it continues its tradingoperations albeit at a lower scale. Due to obsolete technology and old age of machinesyour Company has sold some of the idle plant and machinery at Company's factory at Solapurafter member's approval by way of special resolution in the Extra Ordinary General meetingof the Company on 24th April 2018. The net proceeds from sale of the idle plant andmachinery were utilized to repay Company's existing loans and reduce its interest burden.The Company is currently in the process of making its plan for redevelopment of itsinfrastructure and business.
Due to losses the Directors do not propose dividend for the year.
4. TRANSFER TO RESERVES
Impact of IND AS on the financial statement
The financial statements have been prepared in accordance with the Indian AccountingStandards (Ind As) as notified by Ministry of Corporate Affairs pursuant to Section 133 ofthe Companies Act 2013 (Act') read with of the Companies (Indian AccountingStandards) Rules 2015 for the first time. The Company has exercised one time optionprovided under the Ind As and revalued its vacant free hold land at Fair Market Value ofRs.1724.00 lakhs against its Book Value of Rs 0.28 lakhs in the year 2016-17 resulting increating addition of Rs 1724.00 lakh to General Reserve in accordance with IND AS.
5. DIRECTORS' RESPONSIBILITY STATEMENT
As required under Section 134(3)(c) of the Companies Act 2013 your Directors statethat:
a) in the preparation of attached Annual Accounts for the Financial Year ended 31stMarch 2018 the applicable Accounting Standards have been followed along with properexplanation relating to material departures wherever applicable;
b) The Directors have selected such accounting policies and applied themconsistently and made judgment and estimates that are reasonable and prudent so as to givea true and fair view of the state of affairs of the Company as at March 31 2018 and ofthe profit/loss of the Company for the year ended on that date;
c) The Directors have taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with the provisions of the Act for safeguardingthe assets 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 which are adequate andare operating effectively.
f) The Directors have devised proper systems to ensure compliance with theprovisions of all applicable laws and such systems are adequate and operating effectively
6. DISCLOSURE REQUIREMENTS
The Company has formulated and published a Whistle Blower Policy to provide VigilMechanism for employees including directors of the Company to report genuine concerns. Theprovisions of this policy are in line with the provisions of the Section 177(9) of theAct. The Management Discussion and Analysis forms an integral part of this report andgives details of the overall industry structure economic developments performance andstate of affairs of your Company's businesses internal controls and their adequacy riskmanagement systems and other material developments during the financial year 2017-18. Thesame is annexed herewith as Annexure I.
Shri Premratan Damani's tenure as Managing Director of the Company ends on 30/09/2018.It is proposed to reappoint him as Managing Director for a tenure of 3 year w.e.f.01/10/2018 on the same terms and conditions as existing on 30/ 09/2018. The details of thesame are mentioned in the Explanatory Statement annexed to the Notice of the AnnualGeneral Meeting. Appropriate resolutions for his re-appointment are being placed for yourapproval at the ensuing AGM. Your Directors recommend his re-appointment.
Shri Rajesh Damani's tenure as Joint Managing Director of the Company ends on30/09/2018. It is proposed to reappoint him as Joint Managing Director for a tenure of 1year w.e.f. 01/10/2018 on the same terms and conditions as existing on 30/09/2018. Thedetails of the same are mentioned in the Explanatory Statement annexed to the Notice ofthe Annual General Meeting. Appropriate resolutions for his re-appointment are beingplaced for your approval at the ensuing AGM. Your Directors recommend his re-appointment.
Smt. Rekha Thirani Director of the Company is liable to retire by rotation at theensuing Annual General Meeting pursuant to the provisions of Section 152 of the CompaniesAct 2013 read with the Companies (Appointment and Qualification of Directors) Rules 2014and the Articles of Association of your Company and being eligible has offered herself forreappointment. Appropriate resolutions for her re-appointment are being placed for yourapproval at the ensuing AGM. Your Directors recommend her re-appointment.
8. NUMBER OF MEETINGS OF THE BOARD
During the financial year ended 31st March 2018 Six (6) meetings of the Board ofDirectors were held and the maximum time gap between two (2) meetings did not exceed onehundred and twenty days. The dates of the Board meetings are as under: i.e. 10/05/201714/06/2017 23/08/2017 11/12/2017 12/02/2018 and 12/03/2018.
A separate meeting of Independent Directors pursuant to Section 149 (7) read withSchedule VI of the Companies Act 2013 has been held on 12/03/2018 as per therequirements of the Companies Act 2013.
9. DECLARATION OF INDEPENDENCE
The Company has received declarations from all the Independent Directors confirmingthat they meet the criteria of independence as prescribed under the provisions ofCompanies Act 2103 read with the Schedules and rules issued thereunder as well as Clause49 of the listing Agreement.
10. BOARD EVALUATION
The Company has devised a Policy for performance evaluation of Independent DirectorsBoard Committees and other individual Directors which include criteria for performanceevaluation of the non-executive directors and executive directors. Pursuant to theprovisions of the Schedule IV clause VIII of the Companies Act 2013 the Board hascarried out an evaluation of its own performance as well as performance of IndependentDirectors and Board as a whole.
11. INTERNAL FINANCIAL CONTROL SYSTEMS AND THEIR ADEQUACY
The Board of Directors of the Company has laid down adequate internal financialcontrols which are operating effectively. The policies and procedures adopted by theCompany ensures orderly and efficient conduct of its business including adherence to theCompany's policies safeguarding of its assets the prevention and detection of frauds anderrors the accuracy and completeness of the accounting records and the timelypreparations of reliable financial information.
12. AUDIT COMMITTEE
The Audit Committee comprises of Independent Directors namely Shri S K Somany(Chairman) Shri Kiranbhai J Shah and Shri B.K. Mohta. During the year all therecommendations made by the Audit Committee were accepted by the Board. During thefinancial year ended 31st March 2018 5 (Five) meetings of the Audit Committee of theBoard were held on 10/05/2017 23/08/2017 11/12/2017 12/02/2018 and 12/03/2018
a) Statutory Auditors
At the 109th Annual General Meeting of your Company M/s ADV & AssociatesChartered Accountants (Registration No. 128045W) were appointed as the Statutory Auditorsof the Company till the conclusion of 114th AGM of the Company subject to ratification bythe shareholders at each AGM to be held thereafter as prescribed under Section 139(1) ofthe Companies Act 2013.
The Board hereby recommends their ratification by the shareholders at ensuing AGM to beheld thereafter as prescribed under Section 139(1) of the Companies Act 2013.
Your Company has received written consent and a certificate that M/s ADV &Associates satisfy the criteria provided under Section 141 of the Companies Act 2013 andthat the ratification if made shall be in accordance with the applicable provisions ofthe Companies Act 2013 and rules issued thereunder. There are neither qualificationsreservations nor adverse remarks made by the auditors in their report nor has the Companyreceived any report for frauds noticed or acknowledged by the Auditors during FinancialYear 2017-18.
b) Secretarial Auditor
Pursuant to the provisions of Section 204 of the Companies Act 2013 and The Companies(appointment and Remuneration of Managerial Personnel) Rules 2014 The Company hasappointed Ms. Shipra Agarwal Practicing Company Secretary as the Secretarial Auditor ofthe Company for the year 2017-18
14. AUDITORS' REPORT AND SECRETARIAL AUDITORS' REPORTS
The auditors' report and secretarial auditor's reports do not contain anyqualifications reservations or adverse remarks. Report of the secretarial auditor isgiven as an Annexure II which forms part of this report.
15. RISK MANAGEMENT
The Board of the Company has formed a risk management committee to frame implement andmonitor risk management plan for the Company. The committee is responsible for reviewingthe risk management plan and ensuring its effectiveness. The audit committee hasadditional oversight in the area of financial risk and controls. Major risks identified bythe businesses and function are systematically addressed through mitigating actions on acontinuing basis.
The development and implementation of risk management policy has been covered in themanagement discussion and analysis which form part of this report.
16. PARTICULARS OF LOANS GUARANTEES AND INVESTMENTS
The particulars of loans guarantees and investments have been disclosed in thefinancial statements.
17. TRANSACTIONS WITH RELATED PARTIES
All transactions entered into with the related parties as defined under the CompaniesAct 2013 and LODR during the financial year were in the ordinary course of business andon arm's length basis and do not attract the provisions of Section 188 of the CompaniesAct 2013. There were no material related transactions during the year. Thus disclosure inForm AOC-2 is not required. The details of the transactions with related party areprovided in the financial statement.
18. CORPORATE SOCIALRESPONSIBILITY
The Company does not fall under the criteria fixed for the Corporate SocialResponsibility (CSR) under Section 135 of the Companies Act and as such there is no reporton corporate Social responsibility during the year
19. EXTRACT OF ANNUAL RETURN
As provided under Section 92(3) of the Act the extract of annual return is given in AnnexureIII in the prescribed Form MGT-9 which forms part of this report.
20. SUBSIDIARY/ASSOCIATE COMPANY
The Company does not have any subsidiary joint venture or associate company at thebeginning of the year during the year or at the closing of the year.
21. PARTICULARS OFEMPLOYEES
Information required under Section 197 of the Companies Act 2013 read with Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014. a. Ratio ofremuneration of each Director to the median remuneration of all the employees of yourcompany for the financial year 2017-18 is as follows:
|Name of Director(s) ||Total Remuneration ||Ratio of remuneration of director to the Median remuneration |
|P.R. Damani ||2340000 ||32.09 |
|Rajesh Damani ||702000 ||9.63 |
|S.K. Somany ||18000 ||0.25 |
|B.K. Mohta ||23000 ||0.32 |
|Kiranbhai Shah ||22000 ||0.30 |
|E.A.K Faizullabhoy ||11000 ||0.15 |
|Bipinbhai Patel ||2000 ||0.03 |
|Rekha Thirani ||11000 ||0.15 |
|Jagdish Adhia ||609000 ||8.35 |
1. The remuneration of Non-Executive Directors includes sitting fees paid to them forthe financial year 2017-18.
2. Median remuneration of the Company for all its employees is Rs. 72931/- for thefinancial year 2017-18. b. Percentage increase in remuneration of each Director CFO andCS
|Name (s) ||Designation || |
Remuneration (in Rs.)
|Increase (in %) |
| || ||2017-18 ||2016-17 || |
|P.R. Damani ||Managing Director ||2340000 ||2340000 ||NIL |
|Rajesh Damani ||Joint Managing Director and CFO ||702000 ||702000 ||NIL |
|S.K. Somany ||Independent Director ||18000 ||12000 ||50.00% |
|B.K. Mohta ||Independent Director ||23000 ||16000 ||43.75% |
|Kiranbhai Shah ||Independent Director ||22000 ||12000 ||83.33% |
|E.A.K. Faizullabhoy ||Independent Director ||11000 ||4000 ||175.00% |
|Bipinbhai Patel ||Independent Director ||2000 ||2000 ||NIL |
|Rekha Thirani ||Non Executive Director ||11000 ||6000 ||83.33% |
|Jagdish Adhia ||Whole Time Director ||609000 ||NA ||NA |
|Shweta Rishiraj Kalantri ||Company Secretary ||57120 ||114240 ||NA |
|(Upto 30.09.2017) || || || || |
|Devesh Bhati ||Company Secretary ||180000 ||NIL ||NA |
|(w.e.f. 01.10.2017) || || || || |
c. Percentage increase in the median remuneration of all employees in the financialyear 2017-18
| || || ||(in Rs.) |
| ||2017-18 ||2016-17 ||% Increase / |
| || || ||(Decrease) |
|Median Remuneration of all Employees per annum ||72931 ||99576 ||(26.76) |
d. The number of permanent employees on the rolls of Company: 182(One Hundred andEighty Two)
e. Percentage increase over decrease in the market quotations of the shares of theCompany in comparison to the rate at which the Company came out with the last publicoffer: Your Company is listed in the BSE before Independence. In 1993 the Company cameout with its previous Public Offer. Due to the substantial time gap it is not justifiableto compare it with today's price.
f. Average percentile increase already made in the salaries of employees other than themanagerial personnel in the last financial year and its comparison with the percentileincrease in the managerial remuneration and justification thereof and point out if thereare any exceptional circumstances for increase in the managerial remuneration:
g. Affirmation that the remuneration is as per the remuneration policy of the Company:The Company affirms remuneration is as per the remuneration policy of the Company andthere is no employee stock option scheme.
h. There is no employee in receipt of remuneration exceeding Rs.8.5 lakhs per month orpart thereof or Rs.1.02 cr. per annum or part thereof.
22. DISCLOSURE AS PER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION PROHIBITIONAND REDRESSAL)ACT 2013
The company has zero tolerance for sexual harassment at workplace and has adopted apolicy against sexual harassment in line with the provisions of Sexual harassment of Womenat Workplace (Prevention Prohibition and Redressal Act 2013 and the rules framedthereunder. The company has set up a committee for addressing the issues related to women.During the financial year 2017-18 there were no complaints received on sexual harassment.
23. VIGIL MECHANISM / WHISTLE BLOWER POLICY
The Company has a whistle blower mechanism wherein the employees are free to reportviolation of laws rules regulation or unethical conduct to their immediate Supervisor orsuch other person as may be notified by the Management to the workgroups. Theconfidentiality of those reporting violations shall be maintained and they shall not besubjected to any discriminatory practices.
24. CONSERVATION OF ENERGY TECHNOLOGYABSORPTION AND FOREIGN EARNING AND OUTGO
The particulars relating to conservation of energy technology absorption foreignexchange earnings and outgo as required to be disclosed under the Act are provided in AnnexureIV to this Report.
25. SHARE CAPITAL
a) Issued Subscribed and Paid Up Share Capital
The Issued and Subscribed Share Capital of the Company as on 31st March 2018 wasRs.69995640/- (Rupees Six Crore Ninety Nine Lakhs Ninety Five Thousand Six Hundred andForty Only) divided into 6999564 (Sixty Nine Lakh Ninety Nine Thousand Five Hundred andSixty Four) Equity Shares of Rs.10/- each. The Paid Up Share Capital of the Company as on31st March 2018 was Rs.69865020 /- (Rupees Six Crore Ninety Eight Lakhs Sixty FiveThousand and Twenty Only). The difference between the Issued & Subscribed ShareCapital and the Paid up Share Capital is due to forfeiture of 13062 shares.
b) Forfeiture of Shares:
The Company has forfeited 13062 Equity Shares of Rs.10/- each of the Company videBoard Resolution dated 23rd August 2017 for failure of the holders of those shares to payAllotment Money/ Call Money in accordance with the provisions of the Articles ofAssociation of the Company. c) Consolidation of Shares:
The Company has made an application to the NCLT for seeking approval for Consolidationof its Equity Share Capital by increasing the face value of its shares from Rs.10/- pershare to Rs.1000/- per share. The approval in this regard is pending from the NCLT. Duringthe year under review the Company has not issued shares with differential voting rightsnor granted stock options or sweat equity.
26. MATERIAL CHANGES AFFECTING THE COMPANY
There have been no material changes and commitments affecting the financial position ofthe Company between the end of the financial year and date of this Report. There has beenno change in the nature of business of the Company. However the manufacturing at Company'sfactory at Solapur has been temporarily suspended due to steep increase in input costsobsolete plant and machinery adverse market conditions and acute shortage of labours.Also the implementation of GST has impacted the Company's sales. The management iscontemplating on the further course of action in this regard. Till the management arrivesat a decision the manufacturing at the Company's factory has been suspended temporarilyand production is being carried out by outsourcing it through job work. No orders havebeen passed by the regulators or courts or tribunals which would have an impact on thegoing concern status of the Company and its future operations.
27. INDUSTRIAL RELATIONS
Your Company has always considered its workforce as its valuable asset and continues toinvest in their excellence and Development programs. Your Company has taken severalinitiatives for enhancing employee engagement and satisfaction. The industrial relationsin respect of all other manufacturing facilities and divisions of your Company are normal.
28. STATEMENT PURSUANT TO LISTING AGREEMENT
The Company's Equity shares are listed at BSE Limited. The Annual listing fee for theyear 2017-18 has been paid.
29. CORPORATE GOVERNANCE
The Company does not fall under purview of Regulations of Corporate Governance pursuantto the SEBI (Listing Obligation and Disclosures Requirements) Regulations 2015. Howeverthe same is applicable as per the Companies Act 2013 and the Company is fully compliantwith the applicable provisions.
Your Directors place on record their appreciation of contribution made by the employeesat all levels for the operations of the Company during the year under review.
| ||For and on behalf of the Board |
| ||P.R. Damani |
|Place: MUMBAI ||CHAIRMAN |
|Date: 06/08/2018 || |