Your Directors have pleasure in presenting the 36t Annual Report and standalone andconsolidated audited accounts of the company for the year ended on 31 March 2022.
1. Performance Financial & Other Highlights
The Directors are pleased to report a better performance during the financial year2021-22 (hereinafter referred to as "the year"). The gross income of the Companyincreased from Rs. 13567.63 lakhs in financial year 2020-2021 (hereinafter referred to as"the previous year") to Rs. 21607.46 lakhs in the year representing an increaseof 59.26% as compared with that of the previous year.
Segment wise the sales of Synthetic Leather Division at Rs. 15441.48 lakh were higherby 68% during the year as compared with sales of Rs. 9214.01 lakh during the previousyear. The sales of Electronic Gauge Division at Rs. 6165.98 lakh were 42% higher ascompared to those at Rs. 4353.62 lakh during the previous year.
Company's operating profit before interest depreciation and income tax increased by61% to Rs. 3073.63 lakh during the year as compared with Rs. 1909.27 lakh during theprevious year. The net profit after interest depreciation income tax and deferred taxhave increased from Rs. 1135 lakh to 2024 lakh which was 78.32% higher as comparedwiththat of the previous year. The management considers overall performance to besatisfactory.
During the year there has not been any change in nature of business of the company.The Board of Directors of the Company has however approved a Scheme of Arrangement(details of which have been given elsewhere in this Report) for demerging the NucleonicGauges undertaking of the Company to its wholly owned subsidiary.
The financial statements of the company have been audited by independent statutoryauditors who have previously subjected themselves to peer review. Their Audit reportwhich is annexed is self-explanatory and does not contain any qualification reservationadverse remark or disclaimer calling for comments by the Board. The Board has not proposedany dividend for the year.
The financial highlights of company during the financial year ended 31 March 2022 onstandalone basis are as under:
| || ||(Amount in Rs. lakh) |
|Particulars ||Current Year 2021 - 20221 ||Previous Year 2020 - 2021 |
|Gross Income ||21607.46 ||13567.63 |
|Profit before interest and depreciation ||3073.63 ||1909.27 |
|Financial Charges ||51.88 ||61.28 |
|Gross Profit ||4186.99 ||2682.18 |
|Provision for Depreciation ||293.57 ||286.02 |
|Net profit before Tax ||2728.18 ||1561.97 |
|Provision for Tax (Net) & Deferred Tax ||703.77 ||426.77 |
|Net Profit after Tax ||2024.41 ||1135.20 |
|Balance of profit brought forward ||5818.84 ||4656.57 |
|Balance available for appropriation ||7843.25 ||5818.84 |
|Amount proposed to be carried to reserve || || |
|Transfer from General Reserve ||--- ||- |
|Surplus carried to Balance Sheet ||7843.25 ||5818.84 |
2. Material Changes and commitment if any after the date of financial statementsaffecting the financial position of the company and Future Prospects
No material changes and commitment affecting the financial position of the Company haveoccurred between the end of the financial year to which the financial statements relateand the date of this Directors' Report. The on-going war between Russia and Ukraine has anadverse effect on the economy world-wide. There is an apprehension that the prices of rawmaterial (particularly petroleum products) will continue to rise to new heights. If thishappens your Company may not be in a position to fully recover the same from itscustomers. This may erode some profits.
The Company is continuously upgrading its technology and modernizing plant &machinery to maintain competitive edge in the market. Despite tough competition in themarket its sales are growing every year. For some time now the company has beenconcentrating on PU resin and PU Synthetic Leather where competition is somewhat less.Towards the end of the year the Company entered into a royalty-based technical licensingknow-how agreement with a foreign Company for production of PU resins and PU Tapes forfastener and seam tape application. With effect from 01 January 2022 the company modifiedits PU coated fabrics line resulting in increase of capacity from 24 lakh metres to 30lakh metres per annum. Similarly during the year capacity of PVC coated production lineswas also increased from 78 lakh metres to 94 lakh metres per annum. This coupled withdevelopment of some new products has resulted in significant saving in power fuel andlabour cost per unit giving measurable boost to Company's profit margins.
3. Changes among Directors & Key Managerial Personnel
There have not been any changes among Directors and Key Managerial Personnel during theyear under report. Shri Manish Garg a non-independent director retires by rotation at theensuing Annual General Meeting and being eligible has offered himself forre-appointment. Brief resume of Shri Manish Garg is given in the annexed CorporateGovernance Report which forms part of the Directors' Report.
The three-year tenure of Shri Jai Kishan Garg Managing Director; Shri Navneet GargExecutive Director and Shri Ramnik Garg Executive Director expired on 30th April 202230th April 2022 and 30th June 2022 respectively and being eligible they were re-appointedby the Board for a further tenure of three years each. These re-appointments are subjectto approval of this Annual General Meeting. Details about their remuneration and otherterms of appointment are given under the Corporate Governance Report.
4. Subsidiaries Consolidated Accounts and materiality
The Company has one wholly owned Indian subsidiary as on 31st March 2021 namely JaschGauging Technologies Ltd ("JGTL"). JGTL has been established solely to receivethe demerged business of your Company. Financial statements of JGTL have been consolidatedwith that of the Company. The Company did not have any joint ventures or associatecompanies either at the beginning or at end of the year.
The Company did not hold any deposits at the beginning of the year. It did not acceptany deposits during the year. Therefore there was no occasion for any deposits to remainunpaid or unclaimed or in default for repayment of principal or interest thereon.
6. Internal Audit Internal Financial Control Systems & their adequacy
During the year Company had engaged services M/s Vishal G. Goel & Co CharteredAccountants as Internal Auditors for the Financial Year 2021-22. The scope of their workincludes review of processes for safeguarding the assets of Company effectiveness ofsystems and processes and assessing the internal control strengths in all areas.Management is having tight control on all the operations of the Company. All expenses arescrutinized and approved by the top management. The Company has adequate system so as tohave proper check and control on every department. Deviation from established system ifany are placed before Audit Committee of the Board for review and corrective action to betaken if any.
7. Cost Audit & Cost Record
During the year the Company was mandated to maintain cost records and also appointcost auditors in respect of its products falling under CETA heading 3909 and 3921(Plastics and Polymers). Accordingly the Company duly maintained cost records andsubjected these to cost audit which was conducted by Vipul Bhardwaj & Company Cost& Management Accountants. Cost Audit Report which is required to be submitted by theCost Auditors to the Board of Directors within 180 days of close of financial year hasnot been received yet.
8. Disclosure pursuant to Section 22 of Sexual Harassment of Women at Workplace(Prevention Prohibition & Redressal) Act 2013
In accordance with the Sexual Harassment of Women at Workplace (Prevention Prohibition& Redressal) Act 2013 the Company has a policy on prevention of and affirmativeaction for sexual harassment of women about which all the employees are communicatedperiodically. For this purpose the Company has also constituted an Internal ComplaintsCommittees. At the beginning or end of the financial year under report no cases werepending and during the year no cases were filed or disposed of under that Act.
9. Corporate Social Responsibility
Information required under Rule 8 and 9 of Companies (Corporate Social ResponsibilityPolicy) Rules 2014is given in the Annexure H to this report.
10. Particulars of Specified Employees
Details of employees whose particulars are required to be disclosed in the Directors'Report pursuant to the Companies (Appointment and Remuneration of Managerial Personnel)Rules 2014 are given in Annexure C.
11. Board & Board Committee Meetings
The Board of Directors is the apex body constituted by shareholders for overseeing theCompany's overall functioning. The Board provides and evaluates the Company's strategicdirection management policies and their effectiveness and ensures that stakeholders'long-term interests are being served. The Chairman and Managing Director (CMD) providesoverall direction and guidance to the Board.
The Board has constituted four Committees namely Audit Committee Nomination andRemuneration Committee Finance Committee and Stakeholders' Relationship Committee and isempowered to constitute additional functional Committees from time to time depending onbusiness needs.
For statements on composition of the Board Audit Committee Nomination &Remuneration Committee ("NRC") Stakeholders Relationship Committee and theirMeetings held during the Financial Year under Report; Independent Directors their briefresume the declarations of Independence given by them and appointment of Key ManagerialPersonnel please refer to Annexure A (Corporate Governance Report) which forms anintegral part of this Report. Terms and conditions of appointment of Independent Directorscan be accessed from the website of the Company at the following web link:www.jaschindustries.com/Filings & Disclosures. Details of Board and Committee Meetingsheld during the year under report are given in the annexed Corporate Governance Report.
12. Evaluation of Board its Committees and individual Directors
Pursuant to the provisions of the Companies Act 2013 and the Listing Regulations theBoard carries out periodic evaluation of its own performance that of the directorsindividually as well as that of its Committees as per the criteria suggested by theInstitute of Company Secretaries of India and adopted by the NRC and the Board whichincludes knowledge of directors' duties and responsibilities; understanding of Company'svision mission strategic plan and key issues diligence and participation in BoardCommittee and General Meetings and leadership traits.
13. Company's Policy on Appointment and Remuneration and other matters relating toDirectors
For a policy on Directors' appointment remuneration and criteria for determining theirqualifications positive attributes independence and evaluation required to be disclosedunder Section 178(3) of the Companies Act 2013 and under the Listing Regulations pleaserefer to Annexure B.
14. Disclosure under Section 197(12) of the Act and Rule 5 of the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 Schedule V Part IISection II
The requisite details relating to ratio of remuneration percentage increase inremuneration etc. of managerial personnel as stipulated under the Section/Rulesmentioned in the above sub- heading are annexed as Annexure C to this Report which formspart of this Report. Disclosure pursuant to Schedule V Part II Section II relating toremuneration and other details of directors are given in the attached Corporate GovernanceReport (Annexure A).
15. Audit and Auditors' Report
M/s Mukesh A Mittal & Co. Chartered Accountants who have subjected themselves toa peer review have carried out statutory audit of Company's financial accounts during thefinancial year 2021-22. The report given by them (Auditors' Report) is self- explanatoryand does not contain any qualification reservation adverse remark or disclaimer. Thereis no matter reportable under Section 143(12) of the Companies Act 2013.
The five-year tenure of M/s Mukesh A Mittal & Co. Chartered Accountants is comingto an end upon conclusion of this Annual General Meeting. It is proposed to appoint M/sVijay K Choudhary & Associates Chartered Accountants as Auditors of this Company fromthe conclusion of this Annual General Meeting till the conclusion of 41st Annual GeneralMeeting. Besides consenting to be so appointed they have given a certificate to theeffect that they are eligible to be so appointed and that they have subjected themselvesto a peer review. The Directors recommend their appointment.
17. Secretarial Audit & Secretarial Auditors' report
During the financial year under Report the Company subjected itself to SecretarialAudit by Independent Secretarial Auditors M/s Mukesh Arora & Co Company Secretariesand their report in Form MR-3 is at Annexure D.
18. Vigil Mechanism
In pursuant to the provisions of section 177(9) & (10) of the Companies Act 2013a Vigil Mechanism for directors and employees to report genuine concerns has beenestablished. The Vigil Mechanism Policy has been uploaded on the website of the Company athttps://www.jaschindustries.com/Filings & Disclosures/Policies.
19. Risk management policy
A statement indicating business risks and the management policy to manage the risksforms part of Management Discussion & Analysis Report attached with Directors' Reportas Annexure F.
20. Annual Return
In accordance with the amended provisions of Section 92(3) of the Companies Act 2013a copy of Annual Return after the same has been filed with the Registrar of Companieswill be available at the website of the Company www.jaschindustries.com under the web-link"Filings & Disclosures".
21. Loans Guarantees and Investments
As required under Section 186 of the Companies Act 2013 full particulars of loans andguarantees given investments made and security provided during the year under Report arecontained in the accompanying financial statements
22. Related Party Transactions
On the recommendation of the Audit Committee the Board of Directors of the Company hasadopted a policy to regulate transactions between the Company and parties related to it.This Policy has been uploaded on the website of the Company at www.jaschindustries.comunder the link https://www.jaschindustries.com/Filings & Disclosures/Policies. All therelated party transactions that were entered during the financial year were on arm'slength basis and were in the ordinary course of the business. The Audit Committee hadgranted prior omnibus approval to certain related party transactions and the same weresubsequently placed before the Audit Committee on Quarterly basis for its approval ormodification as the case may be.
Disclosures pursuant to Section 188 of the Companies Act 2013 Regulation 34(3) ofListing Regulations and other applicable provisions of laws are enclosed in Form AOC-2 asAnnexure - E and also by way to Notes to Financial Statements which may be read as part ofthe Directors' Report.
There were no material related party transactions with the Company's PromotersDirectors Management or their relatives which could have had a potential conflict withthe interests of the Company.
23. Corporate Governance Report & Certificate
The Company is committed to maintaining the highest standards of corporate governanceand adhering to the corporate governance requirements set out by SEBI. CorporateGovernance Report together with requisite certificate from the Independent StatutoryAuditors of the Company confirming compliance with the conditions of corporate governanceas stipulated under the Listing Regulations is attached.
24. Management Discussion and Analysis Report
For Management Discussion & Analysis Report please refer to Annexure F whichforms a part of this Report.
25. Conservation of Energy Technology Absorption Foreign Exchange Earnings &Outgo
Information required under section 134 (3) (m) of the Companies Act 2013 read withRule 8 of the Companies (Accounts) Rules 2014 is given in the Annexure G to this report.
26. ISO and IATF Certification
The Company has ISO 9001:2015 certification for Quality Standards ISO 14001:2015certification for environmental management systems and IATF 16949:2016 certification forproviding improved quality products to automotive customers worldwide.
The Equity Shares of the Company are listed on the BSE Limited.
28. Proposed Scheme of Arrangement
During the year on the recommendations of the Audit Committee and the Committee ofIndependent Directors the Board in its meeting held on 24th July 2021 approved aproposed Scheme of Arrangement between the Company (Jasch Industries Ltd -"JIL") ) Jasch Gauging Technologies Ltd ("JGTL" - wholly ownedsubsidiary of JIL) and their respective shareholders and creditors. Under the proposedScheme the nucleonic-gauge related business (including assets and liabilities) of the JILwas proposed to be demerged to JGTL and in substitution of every five shares of JIL heldby its shareholders they will get three shares of JIL and two shares of JGTL. Theproposed Scheme was subject to approval of the shareholders and creditors of both thesecompanies and also subject to regulatory approvals. Opinion was sought and obtained from aSEBI-Registered Category-I Merchant Banker as to fairness of the Scheme. Opinion was alsosought from a registered Valuer with regard to valuation and share-swap ratio. Theproposed Scheme together with the documents mentioned therein are available at the websiteof the Company.
Thereafter on a petition filed with the National Company Law Tribunal("NCLT") New Delhi Bench it ordered meetings of equity shareholders andunsecured creditors of JIL to be held. The only secured creditor of JIL (HDFC Bank) andthe only unsecured creditor and shareholder of JGTL (JIL) had previously granted a"no-objection" to the Scheme.
In the aforesaid meetings held on 10th May 2022 both the shareholders and theunsecured creditors of JIL approved the proposed Scheme with 100% majority. The Company isnow in the process of filing the second petition before the NCLT for its final order.
29. Other matters
As already intimated to the members in the previous Annual Report the place ofRegistered Office of the Company was changed from the State of Haryana to Delhi and theaddress of the present Registered Office of the Company w.e.f. 1607-2021 is 502 Block-CNDM-2 N.S.P. Pitampura New Delhi - 110 034.
Important Note : All the Annexures mentioned in this Report form am integral part ofthis Report.
30. Directors' Responsibility Statement
Pursuant to Section 134 of the Companies Act 2013 the Directors affirm that:
In the preparation of the annual accounts the applicable accounting standardswere followed along with proper explanation if any relating to material departures;
Appropriate accounting policies were selected and applied consistently andjudgments and estimates made were reasonable and prudent so as to give a true and fairview of the state of affairs of the Company as at 31st March 2022 and of the profits ofthe Company for the year ended 31st March 2022;
Proper and sufficient care were taken for the maintenance of adequate accountingrecords in accordance with the provisions of the Companies Act 2013 for safeguarding theassets of the Company and for preventing and detecting fraud and other irregularities;
The annual accounts were prepared on a going concern basis;
Internal financial controls were laid down to be followed by the Company andsuch internal financial controls were adequate and were operating efficiently;
Proper systems had been devised to ensure compliance with the provisions of allapplicable laws and that such systems were adequate and were operating effectively.
Your directors wish to place on record their appreciation of the devoted servicesrendered by the workers the staff the executives of the Company the professionalsassociated with the Company and for the continued support from its Bankers HDFC Bank andother stakeholders.
| ||For & on behalf of the Board |
|Place : Sonipat || |
|Date : 28th May 2022 ||J.K. Garg |
| ||Chairman |