To the Members
Your Directors present the Annual ReporTof JBM Auto Limited (the Company) along withthe audited financial statements for the financial year ended 31st March 2020. Theconsolidated performance of the Company and its subsidiaries has been referred to whereverrequired.
1. FINANCIAL RESULTS
Your Company's financial performance for the year ended 31st March 2020 is summarizedbelow:
Rs in laks
|PARTICULARS || |
| ||FY20 ||FY19 ||FY20 ||FY19 |
|Revenue from operations ||1946.73 ||2206.96 ||1946.73 ||2206.96 |
|Other Income ||15.41 ||24.97 ||15.41 ||24.97 |
|Total Income ||1962.14 ||2231.93 ||1962.14 ||2231.93 |
|Profit Before Interest Taxes and Depreciation and amortization ||245.60 ||282.57 ||245.60 ||282.57 |
|Less: Depreciation ||73.85 ||74.83 ||73.85 ||74.83 |
|Less: Finance Cost ||64.27 ||59.40 ||64.27 ||59.40 |
|Profit for the period before share of profit in associate and joint venture ||107.48 ||148.34 ||107.48 ||148.34 |
|Share of profiTof associate and joint venture ||0.00 ||0.00 ||0.17 ||1.91 |
|Profit Before Tax ||107.48 ||148.34 ||107.65 ||150.25 |
|Tax Expense ||38.00 ||51.71 ||38.43 ||52.16 |
|Profit for the period for continuing operations ||69.47 ||96.63 ||69.22 ||98.09 |
|Other Comprehensive income for the year ||0.00 ||(0.50) ||(0.03) ||(0.55) |
|Total Comprehensive income for the year ||69.47 ||96.12 ||69.19 ||97.54 |
|Less: Non-Controlling Interest ||0.00 ||0.00 ||0.00 ||0.00 |
|Total Comprehensive income attributable to the owners of the company ||69.47 ||96.12 ||69.19 ||97.54 |
2. FINANCIAL HIGHLIGHTS
On Standalone Basis
During FY20 the Company's revenue from operations is Rs. 1946.73 crore as against Rs.2206.96 crores in the previous year thereby decrease of 11.79% against the industrydown by 14.73%. However there is significant increase in Tool Room and OEM division. Theprofit before tax is Rs. 107.48 crore inFY20 as against Rs. 148.34 crore in the previousyear thereby decrease of 27.54%.
On Consolidated BasisIn compliance with the applicable provisions of theCompanies Act 2013 including the Accounting Standard Ind AS 110 on Con- solidatedFinancial Statements this Annual Report also includes Consolidated Financial Statementsfor FY20. The Company's Consolidated revenue from operations is Rs. 1946.73 crores asagainst Rs. 2206.96 crores in the previous year thereby decrease of 11.79% against theindustry down by 14.73%. However there is significant division.
The Profit before tax for the year stood at Rs. 107.65 crores as against Rs. 150.25crores in the previous year thereby decrease of 28.35%.
Your Company has taken several steps to reduce the cost and increase its market sharein all products.
3. DIVIDEND AND APPROPRIATION
75/- (i.e. 35%) per equity share on fully The Board has recommended paid final-up equity shares of Rs. 5/- each on equity share capital for the financial year ended31st March 2020.
The paymenT of dividends is subject to the approval of the shareholders at the ensuing24th Annual General Meeting (AGM) of the Company and will be paid to those members whosename will be appearing in the register of members on the cut-off date 4th December 2020.
No amount has been transferred to the General Reserve for FY20.
4. CHANGE IN THE NATURE OF BUSINESS IF ANY
There was no change in the nature of the business of the Company during the financialyear ended 31st March 2020. However pursuant to merger of JBM Auto System PrivateLimited (Transferor Company No. 1) and JBM MA Automotive Private Limited (TransferorCompany No. 2) with the JBM Auto Limited (Transferee Company) the object clause ofMemorandum of Association of JBM Auto Limited has been amended in order to include theobject clauses of transferor companies.
5. COMPLIANCE WITH SECRETARIAL STANDARDS
The applicable Secretarial Standards i.e. SS-1 and SS-2 relating to Meetings ofthe Board of Directors' and General Meetings' respectively have been duly compliedby your Company except the exemptions/ relaxations granted by Ministry of CorporateAffairs (MCA) under the lockdown period due to COVID 19 pandemic.
6. MATERIAL CHANGES AFFECTING THE COMPANY
There were no material changes and commitments affecting the financial position of theend of FY20 and to the date of this report. As the GovernmenTof India has declaredlockdown all over India w.e.f. 23rd March 2020 to stop the spread corona virus (COVID19) disease all the plants/ units of Company were closed till 15th May 2020 and nomanufacturing/ production activities were carried over there.
7. INVESTOR EDUCATION AND PROTECTION FUND (IEPF)
As per the applicable provisions of the Companies Act 2013 read with InvestorEducation and Protection Fund (Accounting Audit Transfer and Refund ) Rules 2016("IEPF Rules") all unclaimed dividends are required to be transferred by theCompany to the IEPF after completion of seven (7) years. Further according to IEPFRules the shares on which dividend has not been claimed by the shareholders for seven (7)consecutive years or more shall be transferred to the demat accounTof the IEPF Authority.The details relating to amounTof dividend transferred to the IEPF and corresponding shareson which dividends were unclaimed for seven (7) consecutive years are available on thewebsite of the Company at http://www.jbmgroup.com/JBM-Auto-Ltd.php#ChildVerticalTab_27 .
8. HUMAN RESOURCES
The overall satisfaction of the employees of the Company is high. Employees continuedto take charge through collaborative approach and rigorous thinking which become possiblethrough effective HR policies and its religious implementation. The employee's relationswere peaceful and harmonious throughout the year.
9. SHARE CAPITAL AND LISTING OF SHARES
The authorized share capital of the Company is Rs.136 crore and subscribed & paidup equity share capital of the Company is Rs. 23.65 crore. During the year the authorizedshare capital of the Company has increased from Rs. 50 crore to Rs. 136 crore and theCompany has issued 6503489 equity shares to the shareholders of JBM Auto System PrivateLimited and JBM MA Automotive Private Limited pursuant to the scheme of merger of JBM AutoSystem Private Limited (Transferor Company No. 1) and JBM MA Automotive Private Limited(Transferor Company No. 2) with the JBM Auto Limited (Transferee Company) as approved byHon'ble National Company Law Tribunal New Delhi Bench (Court-III) vide its order no.CAA-133/ND/2018 dated 14th June 2019 and by Hon'ble National Company Law Tribunal MumbaiBench (Court- IV) vide its order no. C.P.(C.A.A.)/4660/MB/2019 dated 25th October 2019read with corrigendum dated 17th December 2019.
During the year the Company has also redeemed 50 lacs 8% Non-Cumulative RedeemablePreference Shares having face value of Rs. 10/- each on 13th February 2020 which wereissued to Neel Metal Products Limited on 14th February 2014.
The Company's equity shares are listed on the National Stock Exchange of India Ltd.(NSE) and BSE Limited (BSE). The shares are actively traded on NSE and BSE and have notbeen suspended from trading.
10. SUBSIDIARY JOINT VENTURE AND ASSOCIATE COMPANIES
A statement containing the salient features of financial statements of subsidiaries/joint venture/ associate companies of the Company in the prescribed Form AOC - 1 forms aparTof Consolidated Financial Statements (CFS) in compliance with Section 129(3) and otherapplicable provisions if any of the Act read with Rule 5 of the Companies (Accounts)Rules 2014. The said Form also highlights the financial performance of each of thesubsidiaries/ joint venture/ associate companies included in the CFS of the Companypursuant to Rule 8(1) of the Companies (Accounts) Rules 2014. In accordance with Section136 of the Act the financialstatements of the subsidiary and associate companies areavailable for inspection by the members at the Registered Office of the Company duringbusiness hours on all days except Saturdays Sundays and public holidays upto the date ofthe AGM. Any member desirous of obtaining a copy of the said financialstatements may writeto the Company Secretary at the Registered Office of the Company. The Company hasformulated a policy for determining material subsidiaries. The policy may be accessed onthe website of the Company(http://www.jbmgroup.com/pdf/JBM-Auto-Ltd/Policy/Material-Subsidiary-Policy/JBMA_Auto_Material-Subsidiary.pdf)
11. DIRECTORS AND KEY MANAGERIAL PERSONNEL
Pursuant to Section 149 152 and other applicable provisions of the Companies Act2013 one-third of such of the Directors as are liable to retire by rotation shall retireby rotation every year and if eligible offer themselves for re-appointment at everyAnnual General Meeting (AGM) Consequently Mr. Surendra Kumar Arya retires by rotation andbeing eligible offers himself for re-appointment. A resolution seeking shareholders'approval for his re-appointment forms parTof the Notice.
This is to inform that pursuant to the Section 197 203 Schedule V and otherapplicable provisions if any of the Companies Act 2013 the Shareholders of the Companyin their 19th Annual General Meeting held on 22nd September 2015 had appointed Mr. SandipSanyal (DIN: 07186909) as a Whole Time Director (designated as an "ExecutiveDirector") for a period of 5 (Five) consecutive years w.e.f. 18th May 2015 to 17thMay 2020 The Board of Director in their meeting held on 3rd February 2020 has approvedthe re-appointmenTof Mr. Sandip Sanyal for further period of 1 (one) year w.e.f. 18th May2020. The same shall be placed in the 24th Annual General Meeting for shareholders'approval. A resolution seeking shareholders' approval for their re-appointment forms aparTof the Notice of 24th Annual General Meeting. Pursuant to the provisions of Section149 of the Act the independent directors have submitted declarations that each of themmeet the criteria of independence as provided in Section 149(6) of the Act along withRules framed thereunder and Regulation 16(1)(b) of the SEBI ListingRegulations.Therehasbeennochange affectingtheir status as independent directors ofthe circumstances Company.
During the year under review the non-executive directors of the Company had nopecuniary relationship or transactions with the Company other than sitting fees andreimbursemenTof expenses incurred by them for the purpose of attending meetings of theBoard/ Committee of the Company. None of the Directors of the Company are disqualifiedunder Section 164(2) of the Companies Act 2013 and rules made there under.
Key Managerial Personnel (KMP)
Pursuant to the provisions of Section 203 of the Companies Act 2013 read with rulesmade thereunder following are designated as Key Managerial Personnel (KMP) of the Company:(a) Mr. Sandip Sanyal - Executive Director (b) Mr. Vivek Gupta - Chief Financial Officer& Company Secretary
12. C OMPLIANCES UNDER COMPANIES ACT 2013
(i) ExtracTof Annual Return
As per the requirements of Section 92(3) of the Act and Rules framed thereunder theextracTof the annual return for FY20 is given in Annexure I in the prescribed FormNo. MGT-9 which forms parTof this report.
(ii) Meetings of the Board
During FY20 Five (5) Board Meetings were held. For details thereof kindly refer to theCorporate Governance Report forming parTof this Annual Report.
(iii) Audit Committee
Detailed information of the Committee is provided in the ReporTon Corporate Governanceforming parTof this Annual Report.
(iv) Annual General Meeting
During FY20 Annual General Meeting of the Company was held on 14th September 2019 atAir Force Auditorium Subroto Park New Delhi-110010.
(v) Committees of the Board
The details pertaining to the composition of the Audit Committee Nomination andRemuneration Committee and Stakeholders Committee are included in the Corporate GovernanceReport which forms parTof this report.
(vi) Corporate Restructuring
The scheme of merger of JBM Auto System Private Limited and JBM MA Automotive PrivateLimited with JBM Auto Limited had become effective w.e.f. 1st January 2020 as approved bythe Hon'ble National Company Law Tribunal New Delhi Bench (Court-III) vide its order no.CAA-133/ND/2018 dated 14th June 2019 and the Hon'ble National Company Law TribunalMumbai Bench (Court-IV) vide its order no. C.P. (C.A.A.)/4660/MB/2019 dated 25th October2019 read with corrigendum dated 17th December 2019.
All the necessary compliances and arrangement have been done in this regard.
(vii) Company's Policy on Appointment and Remuneration of Directors
The criteria for determining qualifications positive attributes and independence interms of the Companies Act and the rules made thereunder both in respecTof independentand the other directors as applicable has been approved by the Nomination and RemunerationCommittee. The Board is well diversified and have balance of skills to the Company.
All directors other than independent directors and whole time director are liable toretire by rotation unless approved by the members. One-third of the directors who areliable to retire by rotation retire every year and are eligible for re-election. TheCompany's policy relating to remuneration of directors key managerial personnel and otheremployee can be accessed aTour website athttp://www.jbmgroup.com/JBM-Auto-Ltd.php#ChildVerticalTab_28.
(viii) Dir ectors' Responsibility Statement
Pursuant to Section 134(5) of the Act the Board of Directors to the best of itsknowledge and ability confirm that they: i. have followed in the preparation ofAnnual Accounts for FY20 the applicable Accounting Standards and no material departureshave been made for the same; ii. have selected such accounting policies and applied themconsistently and made judgments and estimates that were reasonable and prudent so as togive a true and fair view of the state of affairs of the Company as at 31st March 2020and of the profit the Company for the year ended on that date; iii. have taken proper andsufficient care for the maintenance of adequate of the Companies Act 2013 forsafeguarding the assets of the Company and for preventing and detecting fraud and otherirregularities; iv. have prepared the annual accounts on a going concern basis; v. havelaid down internal financial controls to be followed by the Company andthat such internalfinancial controls were adequate and were operating effectively; and vi. have devisedproper systems to ensure compliance with the provisions of all applicable laws and thatsuch system were adequate and operating effectively.
Based on the framework of internal financial controls and compliance systemsestablished and maintained by the Company the work performed by the internal statutoryand secretarial auditors and external consultants including the audit of internalfinancial over financial reporting by the statutory auditors and the reviews performed bymanagement and the relevant board committees including the audit committee the Board isof the opinion that the Company's internal financial controls were adequate and effectiveduring FY20.
(ix) Declaration of Independent Directors
The Independent Directors of the Company have given a declaration confirming that theymeet the criteria of independence as prescribed under Section 149(6) of the Companies Act2013 ("the Act") and the SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015.
The term of appointment independent Directors may be accessed on the Company website atthe link:http://www.jbmgroup.com/pdf/JBM-Auto-Ltd/T&C-Appointment-of-Independent-Director/jbm-auto-appointment-of-Independent-directors.pdf
(x) R elated Party Transactions
All contracts/ arrangements/ transactions etc. entered into by the Company with RelatedParties were in ordinary course of business and on arm's length basis. All transactionswith related parties were reviewed and approved by the Audit Committee and are inaccordance with the Policy on dealing with and materiality of Related Party Transactionsformulated by the Company. SMC Credits Limited and A to Z Securities Limited Promoters ofthe Company who hold more that 10% shareholding in the Company. The details of therelated party transactions as per Indian Accounting Standards (IND AS) - 24 are seTout inNote 53 to the Standalone Financial Statements of the Company. Form AOC - 2 pursuant toSection 134(3)(h) of the Companies Act 2013 read with Rule 8(2) of the Companies(Accounts) Rules 2014 is seTout in the Annexure II to this report.
(xi) Auditors and Auditor's Report
(a) S tatutory Auditors
M/s. Sahni Natarajan & Bahl Chartered Accountants (Firm Registration No.002816N) were appointed as Statutory Auditors of the Company at the 21st AGM held on 18thAugust 2017 to hold officefor a period of five consecutive years from the conclusion of21st AGM till the conclusion of the 26th AGM. The requirement to place the matter relatingto appointmenTof auditors for ratificationby Members at every AGM has been done away bythe Companies (Amendment) Act 2017 with effect from 07th May 2018. Accordingly noresolution is being proposed for ratification of appointmenTof statutory auditors at theensuing AGM.
M/s. Sahni Natarajan & Bahl Chartered Accountantshave confirmed that the are notdisqualified from continuing as Auditors of the Company.
The Auditors have issued an unmodified opinion on the financial statements for thefinancial year ended 31st March
(b) Secretarial Auditors
In terms of Section 204 of the Companies Act 2013 and rules made there under Mr.Dhananjay Shukla Practicing Company Secretary (CP No. 8271) was appointed to conduct theSecretarial AudiTof the Company for the financial year 2019-20. He has confirmed that heis eligible for the said appointment.
The Secretarial Audit Report for FY20 is annexed to this Report as Annexure III.
The report is self-explanatory and does not call for any further comments. TheSecretarial Audit Report does not contain any qualification reservation or adverseremark.
(c) Internal Audit
In terms of the provisions of Section 138 read with Companies (Accounts) Rules 2014and other applicable provisions if any of the Companies Act 2013 on the recommendationof the Audit Committee the Board of Directors of the Company in their meeting held on28th May 2019 have appointed Mr. Amol Modak Chartered Accountant and external agency as Internal Auditors of the Company to perform the internal audit for FY20.
(d) Cost Audit
Pursuant to the merger of JBM Auto System Private Limited into JBM Auto Limited thecost audit as specified under Section 148 of the Companies Act 2013 is applicable to theCompany which was earlier applicable to JBM Auto System Private Limited. Mr. MKrishnaswamy was appointed to conduct the audiTof cost records of the Company for FY20.The Board of Directors in their meeting held on 30th June 2020 has appointed Mr. MKrishnaswamy Cost Accountant to conduct the audiTof cost records of the Company for FY21.A resolution seeking approval of a members for ratifying the remunerations payable to thecost auditors for the FY21 is provided in the notice to the ensuing AGM.
(xii) Corporate Social Responsibility (CSR)
The brief outline of the Corporate Social Responsibility (CSR) Policy of the Company asadopted by the Board and the initiatives undertaken by the Company on CSR activitiesduring the year under review are seTout in Annexure IV of this report in the formatprescribed in the Companies (Corporate Social Responsibility Policy) Rules 2014. Forother details regarding the CSR Committee please refer to the Corporate GovernanceReport which forms parTof this Annual report.
Your Company has also been engaged in the Vocational Skill Development in the area ofFabrication Production & Manufacturing in its Skill Development Centres situated atPlot No. 16 Sector-20B Faridabad Haryana 121007 and No. 1 Ford Suppliers Park S.P.Koil Post Chengalpattu (TK) Kancheepuram Dist. Tamil Nadu 603204 and Plot No AV 13 BOLIndustrial Estate Sanand II Dist- Ahmedabad Gujarat which is qualified asEmployment Enhancing Vocational Skills' under Section 135 & Schedule VII of theCompanies Act 2013. It is through these sustained and continued efforts that your Companyhas been able to build and consolidate its CSR initiatives which contribute to nationbuilding.
The CSR Policy including a brief overview of the projects or programs undertaken can beaccessed at the Company's website through the Web-link:http://www.jbmgroup.com/pdf/JBM-Auto-Ltd/Policy/CSR-Policy/JBMA_Auto_CSR_Policy.pdf
The CSR Committee comprises of Mr. Surendra Kumar Arya (Chairman) Mr. Nishant Arya andMr. Mahesh Kumar Aggarwal as other members of the Committee. The Committee inter aliareviews and monitors the CSR. During the year under review your Company spent Rs. 228.49lacs on CSR activities. The amount equal to 2% of the average net profit for the pastthree financial years required to be spenTon CSR activities was Rs. 224.88 lacs.
The brief outline of the Corporate Social Responsibility (CSR) policy of the Companyand the initiatives undertaken by the Company on CSR activities during the year underreview are seTout in Annexure IV of this report in the format prescribed in theCompanies (Corporate Social Responsibility Policy) Rules 2014. For other detailsregarding the CSR Committee please refer to the Corporate Governance Report which formsparTof this report. The CSR policy is available onhttp://www.jbmgroup.com/pdf/JBM-Auto-Ltd/Policy/ CSR-Policy/JBMA_Auto_CSR_Policy.pdf
(xiii) Conservation of Energy Technology Absorbtion and Foreign Exchange Earnings andOutgo
Information pursuant to conservation of energy technology absorption and foreignexchange earnings and outgo as required to be disclosed under the Companies Act 2013 isannexed as Annexure V and forms parTof this report.
(xiv) Remuneration Policy
The policy for selection of directors and determining directors independence and theremuneration policy for directors key managerial personnel & other employees can beaccessed aTour website at http://www.jbmgroup.com/JBM-Auto-Ltd.php#ChildVerticalTab_28
(xv) Particulars of Loans Guarantees and Investments
Particulars of loans guarantees and investments under Section 186 of the CompaniesAct 2013 as at the end of FY20 have been disclosed in the financialstatements.
13. PERFORMANCE EVALUATION
Pursuant to the provisions of the Act Regulation 17(10) of the SEBI (ListingObligations and Disclosure Requirements) Regulations 2015 and the Guidance Note on BoardEvaluation issued by the SEBI dated 5th January 2017 the Board has carried out theannual performance evaluation of its own performance Directors' individually as well asevaluation of its Committees. The evaluation criteria inter-alia covered various aspectsof the Board functioning including its composition attendance of Directors participationlevels bringing specialized knowledge for decision making smooth functioning of theBoard and effective decision making. The performance of individual Directors was evaluatedon parameters such as level of engagement and contribution independence of judgment andsafeguarding the interesTof the Company etc. The Directors expressed their satisfactionwith the evaluation process.
14. REMUNERATION OF DIRECTORS KEY MANAGERIAL PERSONNEL AND PARTICULARS OF EMPLOYEES
The remuneration paid to the directors is in accordance with the Nomination andRemuneration Policy formulated in accordance with Section 178 of the Act and Regulation 19of the SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 (includingany statutory modification(s) or re-enactment(s) thereof for the time being in force).
The Company's policy relating to remuneration of directors key managerial personneland other employee are can be accessed aTour website athttp://www.jbmgroup.com/JBM-Auto-Ltd.php#ChildVerticalTab_28
15. DE TAILS IN RESPECTOF FRAUDS REPORTED BY AUDITORS OTHER THAN THOSE WHICH REPORTABLETO THE CENTRAL GOVERNMENT
The Statutory Auditors Internal Auditors and Secretarial Auditors of the Company havenot reported any frauds to the Audit Committee or to the Board of Directors under Section143(12) of the Companies Act 2013 including rules made thereunder.
16. CORPORATE GOVERNANCE
Your Company has taken adequate steps to ensure compliance with the provisions ofCorporate Governance as prescribed under the SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015. A separate section on Corporate Governance forming aparTof this Report and requisite certificate from the Company's Secretarial Auditorconfirming compliance with conditions of Corporate Governance is attached to the reporTonCorporate Governance.
17. MANAGEMENT DISCUSSION AND ANALYSIS REPORT
In terms of the SEBI (Listing Obligations and disclosure Requirements) Regulations2015 ("Listing Regulations") the Management Discussion and Analysis report isgiven separately and forming parTof the Annual Report.
18. INSIDER TRADING POLICY
During the year under review the Company reviewed compliance with the provisions ofRegulation 9A of SEBI (Prohibition of Insider Trading) Regulations 2015 with respect to"Institutional Mechanism for Prevention of Insider trading" and found thesystems for internal control are adequate and are operating effectively in accordancewith the amendments to the applicable provisions of SEBI (Prohibition of Insider Trading)Regulations 2015. The Policy is available on the website of the Company athttp://www.jbmgroup.com/pdf/JBM-Auto-Ltd/Policy/Insider-Trading-Policy/InsiderTradingCodeApril12019.pdf
19. RISK MANAGEMENT
The Company has a well-defined process in place to ensure appropriate identificationand mitigation of risks. Risk identification exercise is inter-woven with the annualplanning cycle which ensures both regularity and comprehensiveness. The Company haseffectively managed and identified the risks at strategic business operational andprocess levels. Accordingly formulating the mitigation plans and actions for theidentified risks which are driven by senior leadership. The key strategic business andoperational risks which are significant in terms of along with status of the mitigationplans are periodically presented and discussed in the Board and Audit Committee meetings.Inputs from the Audit Committee and Internal Auditors are duly incorporated in the actionplans. All significant risks mitigation plans are well integrated with functional andbusiness plans and are reviewed on a regular basis by the senior leadership. There are norisks which in the opinion of the Board threaten the existence of the Company. Howeversome of the risks which may pose challenges are seTout in the Management Discussion andAnalysis Report which forms parTof this Annual Report.
20. INTERNAL CONTROLS SYSTEMS AND THEIR ADEQUACY
The Corporate Governance Policies guide the conducTof affairs of your Company andclearly delineates the roles responsibilities and authorities at each level of itsgovernance structure and key functionaries involved in governance. The Code of Conduct forSenior Management and Employees of your Company (the Code of Conduct) commits Managementto financial and accounting policies systems and processes. The Risk Management Policyand the Code of Conduct stand widely communicated across your Company at all times.
Your Company's financial statements are prepared on the basis of the significant
Management and approved by the audit Committee and the Board. These accounting policiesare reviewed and updated from time to time.
Your Company uses SAP ERP systems as a business enabler and to maintain its books ofaccount. The transactional controls built into the SAP ERP systems ensure appropriatesegregation of duties appropriate level of approval mechanisms and maintenance ofsupporting records. The systems standard operating procedures and controls are reviewedby management. These systems and controls are audited by Internal Auditor and theirfindings and recommendations are reviewed by the Audit Committee which ensures theimplementation.
Based on the results of such assessments carried out by management no reportablematerial weakness or significant the design or operation of internal financial controlswas observed.
21. VIGIL MECHANISM/ WHISTLE BLOWER POLICY
The Company has a vigil mechanism through its Whistle Blower Policy approved andadopted by Board of Directors of the Company in compliance with the provisions of Section177 (10) of the Act and Regulation 22 of the Listing Regulations.
The mechanism covers any instances of financial irregularities breach of code ofconduct abuse of authority disclosure of financial/ price sensitive informationunethical/ unfair actions concerning Company vendors/ suppliers mala-fide recordsdiscrimination to the Code of Conduct in an anonymous manner. The Policy also providesprotection to the employees and business associates who report unethical practices andirregularities. Any incidents that are reported are investigated and suitable action istaken in line with the Whistle Blower Policy. The Whistle Blower Policy of the Company canbe accessed at website of the Company athttp://www.jbmgroup.com/pdf/JBM-Auto-Ltd/Policy/Whistle-Blower-Policy/JBMA_Whistle-Blower-Policy.pdf
22. D ISCLOSURE UNDER THE SEXUAL HARASSMENTOF WOMEN AT WORKPLACE (PREVENTION PROHIBITION AND REDRESSAL) ACT 2013
The Company has formulated a Policy on Prevention of Sexual Harassment at Workplace forprevention prohibition and redressal of sexual harassment at workplace in accordance withthe Sexual HarassmenTof Women at Workplace (Prevention Prohibition and Redressal) Act2013. The Company is committed to providing a safe and conducive work environment to allof its employees and associates.
The Company periodically conducts sessions for employees across the organization tobuild awareness about the Policy and the provisions of Prevention of Sexual HarassmentAct. No Complaints of sexual harassment were received during FY20 by the Company andpolicy is available on http://www.jbmgroup.com/pdf/JBM-Auto-Ltd/Policy/Sexual-Harrasement-Policy/sexual-harrasement-policy.pdf
23. MEETINGS OF INDEPENDENT DIRECTORS
The Independent Directors of your Company meTon 11th February 2020 without thepresence of the Non-Independent Director or any other Management Personnel. The Meetingwas conducted in an informal and flexible Directors to discuss matters pertaining tointer alia review of performance of Non-Independent Directors and the Board as a wholereview the performance of the Chairman of the Company (taking into account the views ofthe Executive and Non-Executive Directors) review the performance of the Company assessthe quality quantity and timeliness of flow of information between the Company Managementand the Board that is necessary for the Board to effectively and reasonably perform theirduties. The meeting was attended by all the Independent Directors.
24. DE TAILS OF SIGNIFICANT AND MATERIAL ORDERS
During the year under review no significanTor material orders were passed by theRegulators or Courts or Tribunals which impact the going concern status and Company'soperations in future.
However the Hon'ble National Company Law Tribunal New Delhi Bench (Court-III) videits order no. CAA-133/ND/2018 dated 14th June 2019 and Hon'ble National Company LawTribunal Mumbai Bench (Court- IV) vide its order no. C.P.(C.A.A.)/4660/MB/2019 dated 25thOctober 2019 read with corrigendum dated 17th December 2019 has approved the scheme ofmerger of JBM Auto System Private Limited (Transferor Company No. 1) and JBM MA AutomotivePrivate Limited (Transferor Company No. 2) with the JBM Auto Limited (Transferee Company).
25. PUBLIC DEPOSITS
During the year your Company did not accept any public deposits under Chapter V of theCompanies Act 2013 and as such no amounTon accounTof principal or interesTon publicdeposits was outstanding as of 31st March 2020.
26. EMPLOYEES STOCK OPTION PLANS/ SCHEMES
No Employee Stock Options were granted to the Directors or Employees of the Companyduring the year under review.
27. P ARTICULARS OF EMPLOYEES
In terms of the provisions of Section 197(12) of the Act read with Rules 5(2) and 5(3)of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 astatement showing the names and other particulars of the employees drawing remuneration inexcess of the limits seTout in the said rules are form parTof the Annual Report.
Disclosures pertaining to remuneration and other details as required under Section197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014 are form parTof the Annual Report. However as per firstproviso to Section 136(1) of the Act the Annual Report excluding the aforesaidinformation is being sent to the members of the Company. The said information is availablefor inspection at the registered office of the Company during working hours and any memberinterested in obtaining a copy of such information may write to the Company Secretary atthe registered office of the Company and the same will be furnished without any fee.
28. INDUSTRIAL RELATIONS
Your Company's focus continues towards propagating proactive and employee centricpractices. The transformational work culture initiative which aims to create an engagedworkforce with an innovative productive and competitive shop-floor ecosystem continuesto grow in strength. In order to develop skills and foster togetherness at the workplaceyour Company rolled out multiple training and engagement programs covering a wide range oftopics viz. positive attitude stress management creativity team effectiveness safetyand environment quality tools skill building programs customer focus and Code ofConduct. Significant emphasis was also laid towards raising awareness on health andwellness health awareness activities and online yoga sessions.
Proactive and employee-centric shop floor practices a focus on transparentcommunication of business goals an effective concern resolution mechanism and a firmbelief that employees are the most valuable assets of the Company are the cornerstones ofyour Company's employee relations approach. The industrial relations scenario continued tobe positive across all manufacturing locations.
29. A WARDS & RECOGNITIONS
During the year the Company had received various awards and recognitions which havebeen described in Management Discussion and Analysis Report forming parTof the AnnualReport.
30. COST RECORDS
Pursuant to the merger of JBM Auto System Private Limited into JBM Auto Limitedmaintenance of cost records as specified Section 148(1) of the Companies Act 2013 areapplicable to the Company which was earlier applicable to JBM Auto System PrivateLimited. Accordingly such accounts and records are made and maintained by the Companyduring FY20.
31. CREDIT RATING
CRISIL has assigned its credit rating of A1 for short term instruments and the ratingfor long term debt instruments is A and indicating the outlook on the long term rating as"Stable".
32. O THER DISCLOSURES
a. The Company has complied with Secretarial Standards issued by the Institute ofCompany Secretaries of India on Meetings of the Board of Directors and General Meetings;b. The Company has not issued equity shares with differential rights as to dividendvoting or otherwise.
The Board of Directors place on record sincere gratitude and appreciation for all theemployees at all levels for their hard work solidarity cooperation and dedication duringthe year. The Board conveys its appreciation for its customers shareholders suppliers aswell as vendors bankers business associates regulatory and government authorities fortheir continued support.
| ||For and on behalf of the Board of Directors of JBM Auto Limited |
| ||Sd/- |
| ||Surendra Kumar Arya Chairman |
|Date: 12th September 2020 ||DIN : 00004626 |