Your Directors have pleasure in presenting their 42nd Annual Report on thebusiness and operations of the Company and the accounts for the Financial Year ended March31 2016.
1. Financial summary or highlights/Performance of the Company
(Rs. In Lacs)
|Financial Results ||Year Ended 31/03/16 ||Year Ended 31/03/15 |
|Income ||8.11 ||5.87 |
|Expenditure ||9.54 ||5.29 |
|Profit before Depreciation ||(1.43) ||0.58 |
|Less : Depreciation ||(14.45) ||(15.87) |
|Profit before Tax ||(15.88) ||(15.29) |
|Less : Provision for Income Tax ||- ||- |
|Net Profit (Loss) for the year ||(15.88) ||(15.29) |
|Balance of Profit Brought Forward ||(3879.78) ||(3862.96) |
|Total Profits available for Appropriation ||(3895.66) ||(3878.25) |
|Less : Adjustment in carrying value of Assets whose remaining life as on 01.04.15 is expired. ||0.00 ||(1.53) |
|Balance Carried to Balance Sheet ||(3895.66) ||(3879.78) |
In view of huge losses incurred by the Company the directors regret their inability torecommend any dividend (Previous year Nil).
The Board does not propose to carry any amount to any reserves.
4. Brief description of the Company's working during the year/State of Company's affair
The Company made reference to the Honorable BIFR in August 2003 and had been declaredsick under the provisions of SICA 1985 vide order dated 17th May 2006. Thecompany made efforts and settled the dues of all the Working Capital Banks and IDBIFinancial Institution in the year 2007 through One-time-settlement of their dues.
The remaining two secured creditors Asset Reconstruction Company ARCIL and EdelweissAsset Reconstruction Company Limited (bought portfolio from the Financial InstitutionExim Bank of India) had initiated recovery action under Securitization and Reconstructionof Financial Assets and Enforcement of Security Interest Act (SARFAESI Act) 2002.
As the Secured Lenders ARCIL And Edelweiss have taken action under section 13(4) ofSARFAESI Act 2002 the Hon'ble BIFR pursuant to an application by the referred SecuredCreditors has ordered on 26.11.2007 to abate the reference filed under SICA Act.
The Company had been issued notice under section 13(4) of the SARFAESI Act forpossession of Secured Assets that include a part of land building and completemachineries (except the machines charged to IDBI earlier) charged to the saidInstitutions. The Company had been appointed as Custodian of said Secured Assets witheffect from July 11 2007. The Company was allowed to continue the routine businessoperations on payment of Rs 25000 per month towards royalty charges. In April 2011 theFinancial Institutions withdrew the custodianship from the company and took the physicalpossession of the factory.
ARCIL also filed a company petition under Section 433(1)(e) of the Company 's Act 1956for winding up of the company before the Hon'ble High Court of Madhya Pradesh at IndoreBench. The Company has filed proper reply opposing the winding-up petition filed by ARCIL.The petition is rejected by the Hon'ble High Court of Madhya Pradesh Indore Bench.
As the Secured Creditors terminated the custodianship of the company and took thephysical possession of factory in
April 2011 there were no manufacturing operations carried out in the factory. TheSecured Creditors have sealed the production facilities and have deployed their ownsecurity personal. Consequently there was no production and sales in the company.
The company also could not perform any trading activity as the Commercial TaxDepartment has cancelled the registration of the company due to the tax liability beingunpaid. The Commercial Tax Department has also raised its claim on the fixed assets of thecompany to recover their dues. There is a dispute between Secured Creditors and theCommercial Tax Department regarding priority of charge on the fixed assets of the companyand the matter is still unresolved.
However the company started some operations in the form of arranging sales to differentbuyers on commission basis. This commission income helped the company to take care of allthe expenses in the year. The management is continuously trying to have a settlement withthe said two Secured Creditors so that the company can revive its operations in thefuture. Once the settlement is done the company is also hopeful of reinstating of itscommercial tax registration and start business operations.
Further as the company does not have any manufacturing activities and also does nothave any sales income it faced severe hardship in complying with several statutoryrequirements like appointment of a Whole-time Company Secretary. The Company tried itsbest but considering the company's financial position none of the candidates agreed tojoin the company. The company is still trying to comply with this requirement.
5. Change in the nature of business if any:
There was no business activity previous year and in the current year the company earnedcommission income.
6. Material changes and commitments if any affecting the financial position of thecompany which has occurred between the end of the financial year of the company to whichthe financial statements relate and the date of the report:
There is no material change or commitment occurred between the end of the financialyear and the date of report that would affect the financial position of the company.
7. Details of significant and material orders passed by the regulators or courts ortribunals impacting the going concern status and company's operations in future :
There is no order passed by any court during the year.. However there are certainimportant matters under litigation that are described below:
8. Winding-up Petition by ARCIL
The Secured Creditor ARCIL has filed a company petition under Section 433(1) (e) of theCompany's Act 1956 for winding up of the company before the Honorable High Court ofMadhya Pradesh at Indore Bench. The Company has filed reply opposing the winding-uppetition filed by ARCIL. The petition is rejected by the Hon'ble High Court of MadhyaPradesh Indore in favor of the company.
9. Details of Subsidiary/Joint Ventures/Associate Companies:
The Company does not have any subsidiary/joint venture /associate company.
10. Performance and financial position of each of the subsidiaries associates andjoint venture companies included in the consolidated financial statement.
As the company does not have any joint ventures or associate companies this sectionis not applicable.
11. Corporate Governance
Corporate Governance is an ethically driven business process that is committed tovalues aimed at enhancing an organizations brand and reputation. The new Companies Act2013 and amended Listing Regulations have strengthened the governance regime in thecountry. The Company is in compliance with the governance requirements provided under thenew law and had proactively adopted many provisions of the new law ahead of time. TheCompany is committed to maintain the highest standards of corporate governance and adhereto the corporate governance requirements set out by SEBI. Report on Corporate Governanceis forming part of the Annual Report as Annexure - "B".
A separate report on Corporate Governance is provided together with a Certificate fromthe Statutory Auditors of the Company confirming compliance with conditions of CorporateGovernance as stipulated under Regulation 34 read with Schedule V of the ListingRegulations is annexed to the Annual Report.
A Certificate of the MD of the Company in terms of Regulation 17(8) read with Part B ofSchedule II of the Listing Regulations inter alia confirming the correctness of thefinancial statements and cash flow statements stating that members of Board of Directorsand Senior Management have affirmed compliance with the Company's Code of Conduct andadequacy of the internal control measures and reporting of matters to the Audit Committee.
During the year under review Company did not accept any fixed deposits in terms ofSection 73 and 74 of the Companies Act 2013 read together with the Companies (Acceptanceof Deposits) Rules 2014.The Company did not have outstanding deposits at the beginning/at the end of the year.
13. Statutory Auditors
At the Annual General Meeting held on September 30 2015 M/s S.P. Moondra & Co.Chartered Accountants were appointed as statutory auditors of the Company to hold officetill the conclusion of the Annual General Meeting to be held in the year 2017. In terms ofSection 139 to the Companies Act 2013 the appointment of the auditors shall be placedfor ratification at every Annual General Meeting. Accordingly the appointment of M/s S.P.Moondra & Co. Chartered Accountants as statutory auditors of the Company is placedfor ratification by shareholders.
14. Auditors' Report
The Auditors have made certain qualifications in their report. The Directors' CommentsTo The Qualification Made By Auditor Are Given Below:
i. The Auditors in the point no.1 clause (b) of Annexure to their report have madecomments for not able to do physical verification of the assets of the company. Further tothis qualification the Director want to comment that as the possession of the securedassets of the company has been taken by the secured lenders physical verification of theassets of the company could not be carried out.
ii. The Auditors in the Point No. 7 clause (a) of Annexure to their report hasmentioned about the arrears of undisputed amounts for MPCT/CST Entry Tax ProfessionalTax and Cess duty further to this qualification the Director want to comment that thisdues has been pending from preceding financial years the reasons of which are mentionedunder POINT NO. 4 of Directors Report.
iii. The Auditors in the Point No. 7 clause (b) of Annexure to their report hasmentioned about the dues in respect of Sales Tax that has not been deposited with theappropriate authorities further to this qualification the Director want to comment thatthis dues has been pending from preceding financial years the reasons of which arementioned under POINT NO. 4 of Directors Report.
iv. The Auditors in the Point No. 8 of Annexure to their report have also madequalifications regarding irregularity in payment of dues to Bank. The Company is passingthrough severe financial hardships as explained in point No 4 of the Director Reportabove and as a result there were instances of irregularity in the payment of dues tobanks. The company is also perusing with the banks for One time settlement of their dues.
15. Share Capital
The paid up Equity Share Capital as at March 31 2016 stood at Rs. 6.46 Crore. Duringthe year under review the Company has not issued shares with differential voting rightsnor has granted any stock options or sweat equity. As on March 31 2016 none of theDirectors of the Company hold instruments convertible into equity shares of the Company.
16. Extract of the annual return
An extract of the Annual return for the financial year ended 31st March2016 as required under Section 92(3) of the Companies Act 2013 is enclosed herewith inthe specified format as Annexure '(A).
17. Conservation of energy technology absorption and foreign exchange earnings andoutgo
The details of conservation of energy technology absorption foreign exchange earningsand outgo are as follows:
A) conservation of energy
The company did not carry out any manufacturing activity during the year and hencethere was no scope for any conservation of energy.
B) foreign exchange earnings and outgo
Total foreign exchange earned Rs. NIL Total foreign exchange outgo Rs.NIL
18. Corporate Social Responsibility Initiatives (CSR)
In view of the paid up capital profits and turnover of the company during the previousthree years the company does not fall under the provisions of the section 135 of theCompanies Act 2013 and the rules made their under.
In accordance with the provision of the Companies Act 2013 and in the terms of theMemorandum and Articles of Association of the Company Mr. Pramod Somani (DIN 00042745)retires by rotation and is eligible for reappointment.
20. Key Managerial Personnel
1. Mr. Rajendra Kumar Ved is the CFO of the Company.
2. Mr. Pramod Somani is the Managing Director of the Company.
21. Particulars of loans guarantees or investments under section 186
Pursuant to Section 134(3)(g) of the Companies Act 2013 particulars of loansguarantees or investments provided by the Company under Section 186 of the Act as at endof the Financial Year 2015-16 the Company has neither given any loan or guarantee normade any investments during the year. There is no outstanding in relation to Loansguarantee or investments at the end of the year.
22. Particulars of Employees
The information required pursuant to Section 197 read with Rule 5 of The Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 in respect of employeesof the Company is as follows:
1. No sitting fees have been paid to any director during the year.
2. Considering the company's week financial position none of the Directors is drawingany remuneration from the company. Only Mr. Rajendra Kumar Ved CFO has been paid salaryof Rs 90000/- in Financial Year 2015-16.
Hence the other information as required pursuant to Rule 5(1) of the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 is NIL
23. Particulars of contracts or arrangements with related parties:
During the financial year 2015-16 the Company has not entered into transactions withrelated parties as defined under Section 2(76) of the Companies Act 2013 read withCompanies (Specification of Definitions Details) Rules 2014 During the financial year2015-16 there were no transactions with related parties which qualify as materialtransactions under the Listing Agreement/ SEBI (LISTING OBLIGATIONS AND DISCLOSUREREQUIREMENTS) REGULATIONS 2015 and the Companies Act.
In line with the requirements of the Companies Act 2013 and Equity Listing Agreement/SEBI (LISTING OBLIGATIONS AND DISCLOSURE REQUIREMENTS) REGULATIONS 2015 the Company hasformulated a Policy on Related Party
Transactions which is also available on Company's website at www.jolindia.com. The Policy intends to ensurethat proper reporting; approval and disclosure processes are in place for all transactionsbetween the Company and Related Parties. Therefore the Company is not required to furnishany particulars in the Form AOC-2.
24. Secretarial Audit Report
Pursuant to the provisions of Section 204 of the Companies Act 2013 read with theCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014 the Companyhas appointed Mr. Manish Maheshwari Practicing Company Secretary to conduct theSecretarial Audit of the Company. The Secretarial Audit Report is annexed herewith to thisReport and marked as Annexure - "B".
The Secretarial Audit Report contains some qualification whose explanation is given asunder:
1. The company has been declared sick under provisions of SICA 1985 vide order dated17th May 2006 by BIFR.
2. There were no manufacturing operations carried out in the factory. The SecuredCreditors have sealed the production facilities and have deployed their own securitypersonal. Consequently there was no production and sales in the company due to which itdoes not have any sales income and is facing severe hardship in complying with severalstatutory requirements like appointment of a Whole-time Company Secretary and InternalAuditor. The Company tried its best but considering the company's financial position noneof the candidates agreed to join the company. Further due to the reasons as mentioned inthe point No 4 of the Director report the company could not make the payment of BSE forthe FY 2016-17 and is trying hard to make the payment at the earliest.
3. The company is still trying to comply with this requirement and coping up to reviveits financial position.
25. Management Discussion and Analysis Report
The Management Discussion and Analysis forms an integral part of this Report asstipulated under Regulation 34(2) of SEBI (Listing Obligations and DisclosureRequirements) Regulation 2015 entered with the Stock Exchange is set out in the Annexureforming part of Annual Report marked as Annexure - "A".
26. Board Meetings
The details of the number of Board and Committee meetings of the Company are set out inthe Corporate Governance Report which forms part of this Report.
27. Risk management policy
The Company has framed a Risk Management Policy to identify and access the key businessrisk areas and to resolve the same risk for smooth operations which is the regulatoryrequirements of Section 134(3) of Companies Act 2013. A detailed exercise is beingcarried out at regular intervals to identify evaluate manage and monitor all risks. TheBoard periodically reviews the risks and suggests steps to be taken to control andmitigate the same through a properly defined framework.
28. Internal Financial Control
According to Section 134(5) (e) of the Companies Act 2013 the term Internal FinancialControl (IFC) means the policies and procedures adopted by the company for ensuring theorderly and efficient conduct of its business including adherence to company's policiesthe safeguarding of its assets the prevention and detection of frauds and errors theaccuracy and completeness of the accounting records and the timely preparation ofreliable financial information.
The company is not doing any manufacturing activity and sales activity. Further thereare no staffs or workers except a CFO left in the company. Hence the size of operationsis minimal and the company has adequate internal financial controls required to presentthe true picture of financial statements.
29. Directors' Responsibility Statement
Your Directors state that:
a) in the preparation of the annual accounts for the year ended March 31 2016 theapplicable accounting standards read with requirements set out under Schedule III to theAct have been followed and there are no material departures from the same;
b) the Directors have selected such accounting policies and applied them consistentlyand made judgments and estimates that are reasonable and prudent so as to give a true andfair view of the state of affairs of the Company as at March 31 2016 and of the loss ofthe Company for the year ended on that date;
c) the Directors have taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of the Act for safeguarding theassets of the Company and for preventing and detecting fraud and other irregularities;
d) the Directors have prepared the annual accounts on a 'going concern' basis;
e) the Directors have laid down internal financial controls to be followed by theCompany and that such internal financial controls are adequate and are operatingeffectively; and the Directors have devised proper systems to ensure compliance with theprovisions of all applicable laws and that such systems are adequate and operatingeffectively.; and
f) The Directors have devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems are adequate and operating effectively.
30. Anti Sexual Harassment Policy
The company does not have any female staff and hence there is no requirement of havingAnti Sexual Harassment policy. However the Company would definitely place an Anti SexualHarassment Policy in line with the requirements of Sexual Harassment of Women at Workplace(Prevention Prohibition and Redressal) Act 2013 if there is any female employee atworkplace.
The Directors wish to convey their appreciation for the cooperation extended by bankersand various Government agencies. The Directors also wish to thank the Shareholders CFOand for their support and co-operation.
| ||For Jyoti Overseas Limited |
|Date: 13th August 2016 ||Pramod Somani |
|Place: Ghatabillod ||(Managing Director) |
| ||(DIN: 00042745) |