Khaitan (India) Ltd.
|BSE: 590068||Sector: Others|
|NSE: KHAITANLTD||ISIN Code: INE731C01018|
|BSE 00:00 | 11 Mar||Khaitan (India) Ltd|
|NSE 05:30 | 01 Jan||Khaitan (India) Ltd|
|BSE: 590068||Sector: Others|
|NSE: KHAITANLTD||ISIN Code: INE731C01018|
|BSE 00:00 | 11 Mar||Khaitan (India) Ltd|
|NSE 05:30 | 01 Jan||Khaitan (India) Ltd|
TO THE MEMBERS
KHAITAN (INDIA) LIMITED
SUMMARY OF FINANCIAL HIGHLIGHTS
Your Directors present their 83rd Annual Report together with the Audited Accounts forthe year ended 31st March 2020.
Rs. In Lacs
The beginning of 2020 has witnessed the global spread of COVID-19 i.e. corona virus.Global threat from COVID-19 is continuing to grow and at a rapidly accelerating rate.Governments in many countries announced lockdowns and asked people to stay indoors. Aroundthe world these corona virus lockdowns have driven professional and social life out ofthe physical world and into the virtual realm. The economic fallouts of this is stilldifficult to assess as the situation is still evolving.
INDIAN ACCOUNTING STANDARDS
The Financial Statements are prepared in accordance with the Indian AccountingStandards (Ind AS) under the historical cost convention on accrual basis. The ministry ofcorporate affairs (MCA) vide is notification in the official Gazette date February 162015 notified the Indian Accounting Standards (Ind AS) applicable to certain classes ofcompanies. Ind AS is applicable from 1st April 2017.
There was no change in the share capital of the company.
DIVIDEND AND TRANSFER TO RESERVE
The Company had incurred losses and Board considered it prudent (with a view toconserve the resources for the company's growth and expansion) not to recommend payment ofany dividend on the Equity shares for the financial year under review. Further Board ofthe company has decided not to transfer any sum to reserve.
ECONOMIC CLIMATE AND OUR PERFORMANCE
In the last month of FY 2020 the COVID-19 pandemic developed rapidly into a globalcrisis forcing governments to enforce lock-downs of all economic activity. Before theCOVID-19 lockdown both the Reserve Bank of India (RBI) and the Central Statistical Office(CSO) of the Government of India had revised the GDP growth rate downwards. The RBIchanged its full year GDP growth estimate from 7.2% to 5.0% in February 2020. In a similarvein the second advance estimates of national income for FY2020 released by the CSO on 28February 2020 pegged GDP growth for FY2020 at 5.0% compared to 6.1% in FY2019; and growthin gross value added (GVA) at 4.9% in FY2020 versus 6.0% in FY2019.
The CSO officially released the data on GDP growth for FY2020 and Q4 on 29 May 2020.The numbers were worse than projected above. GDP growth for FY2020 was 4.2% an 11-yearlow. And for Q4 FY2020 it was 3.1% thanks to the COVID-19 lockdown effect. The company isalso expected to greatly affected due to effect and after effect of economic slowdown andCorona pandemic.
Marketing division of the company markets electrical products like fan cooler pumpsetc. We report that the marketing division has contributed significantly to turnover ofthe company. We believe that the marketing division would perform better in the time tocome and shall contribute significantly in profitability also. Due to Covid - 19 reasonsthere has been a substantial fall in Revenue and the company is expecting that in 1st halfof the year 2020-21 the revenue shall be affected. This effect may continue beyond first 6months also.
During the year company could not start operation of the sugar mill (seasonal) mainlydue to paucity of fund to finance the working capital requirement and other direct andoperation expenses.
No credit rating during the financial year under review was received by the company.
SUSTAINABLE DEVELOPMENT AND ENVIROMENT
We consider sustainable development and environment protection as integral part ourmanagement culture. There is renewed thrust of environment protection in current yearwherein we have put special effort on plant protection on our agricultural land.
CASH FLOW ANALYSIS
In conformity of the provision of Regulation 34 of the SEBI (Listing Obligation andDisclosure Requirements) Regulations 2015 the cash flow statement for the year ended31.03.2020 is included in the financial accounts.
SIGNIFICANT EVENTS AFTER BALANCE SHEET DATE
There has been no significant event after Balance Sheet Date.
PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS
Reference is made to financial statements for loans to bodies corporate and forguarantees provided by the Company.
As regards details of Investments in bodies corporate the same are given in thefinancial statements.
CERTIFICATION FROM AUDITORS IN RELATION TO CORPORATE GOVERNANCE
The Report on Corporate Governance as stipulated in the Listing Regulations forms partof the Annual Report. The requisite certificate from M/s. K. C. Bhattacherjee & PaulChartered Accountants confirming compliance with the conditions of Corporate Governanceas stipulated under the Listing Regulations is annexed hereto Annexure I to this Report.
As per SEBI (Listing Obligations and Disclosure Requirements) Regulation 2015 annexedto this report is Auditors' Certification on Corporate Governance forming part of theAnnual Report.
DETAILS IN RESPECT OF FRAUDS REPORTED BY AUDITORS UNDER SECTION 143(12)
During the year under review there were no frauds reported by the auditors to theAudit Committee or the Board under section 143(12) of the Companies Act 2013.
MANAGEMENT DISCUSSION AND ANALYSIS
The Management Discussion and Analysis Report for the year under review as stipulateunder SEBI (Listing and Disclosure Requirements) Regulations 2015 is attached.
The Company has not accepted any deposit from public falling within the ambit ofSection 73 of the Companies Act 2013 and the Company's (Acceptance of Deposit) Rules2014
PARTICULARS OF LOAN AND GUARNTEE AND INVESTMENT
Details of Loans Guarantees and Investments covered under the provisions of section186 of the Companies Act 2013 are given in the notes to the Financial Statements andhence not repeated in directors report.
CORPRATE SOCIAL RESPONSIBILITY (CSR)
The Company has not developed and implemented any Corporate Social Responsibilityinitiatives as the said provisions are not applicable to the Company.
WHISTLE BLOWER POLICY
The Company has a Whistle blower policy which is hosted on its websitewww.khaitansugar.in in compliance with the provisions of Section 177 (9) of the Act andRegulation 46 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations2015.
EXTRACT OF ANNUAL RETURN
The details forming part of the extract of Annual Return in Form MGT- 9 is given inAnnexure -l DIRECTORS
There are 3 Directors on the Board out of which 2 are independent Director and 1 isWhole Time Director.
(i) There has been no change in Directorship during the year 2019-2020. Mrs. SujataChatterjee (DIN No. 00245656) was appointed as Additional Non Executive Independentdirector with effect from 31.07.2020. She is B.A. (Hons) and M.A. She has nearly twodecades of experience in management of Secretarial Compliance and Administration. Herappointment as Independent Director is to be confirmed by the Share Holders in theforthcoming Annual General Meeting.
(ii) RETIREMENT BY ROTAION
In accordance with the provision of section 152 of the Companies Act 2013 Mr. SunayKrishna Khaitan (Din: 07585070) retires by rotation and being eligible offers himself forreappointment.
(iii) BOARD AND COMMITTEES EVALUATION
Pursuant to the provisions of the Companies Act 2013 and SEBI (Listing Obligations andDisclosure Requirements) Regulation 2015 the
Board has carried out annual performance evaluation of its own performance thedirectors individually as well as working of its Audit
Nomination & Remuneration and Shareholders Relationship Committee. The method ofevaluation has been explained in Corporate Governance Report.
(iv) BOARD MEETING
The details of meeting of Board and its various committees are given in CorporateGovernance Report part of the report.
(v) DISQUALIFICATION OF DIRECTORS
None of the Directors are disqualified under section 164(2) of the Companies Act 2013.
(vi) INDEPENDENT DIECTOR DECLARATION
All the Independent Directors have given their declaration confirming that they themeet the criteria of independence in terms of section 149(6) of the Companies Act 2013.
Executive Director and whole time Director were not in receipt of any commission formthe company.
Executive Director and Whole time Director was not in receipt of any commission fromthe subsidiary (there is no subsidiary).
KEY MANAGEMENT PERSONNEL
Mr. Swapan Kumar Das appointed as Chief Financial Officer (CFO) with effect from06.04.2019. He is a qualified M.Com in Commerce and has more than three decades ofExperience in Finance Account and Administration industries including consumer durables.
Mr. Pradip Halder was appointed as Company Secretary and Compliance Officer with effectfrom 29.05.2019. He is a Qualified Company Secretary and is a Member of the Institute ofCompany Secretaries of India.
There has been no resignation of KMP during the year 2019-2020.
ENERGY CONSERVATION TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARINING & OUTGO
The information on Conservation of energy technology absorption and foreign exchangeearnings and outgo stipulated under section 134(3)(m) of the Companies Act 2013 read withRule 8 of the Companies (Account) Rule 2014 is annexed as Annexure-ll.
INFORMATION OF EMPLOYEES
Provision of Section 197 of the Companies Act 2013 read with Rule 5 (2) and (3) of theCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014 are notapplicable as no employee or director of the Company was in receipt of such remunerationas prescribed under the said rules.
The Company believes that its employees are a vital resource in the current businessenvironment. The Company is enjoying good and congenial industrial relations at all theDivisions of the Company. The prescribed information of the employees required undersection 134(3)(q) read with Rule 5 of the Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014 is attached herewith as Annexure -Ill. ESTABLISHMENT OFVIGIL MECHANISM POLICY
To ensure that the activities of the Company and its employees are conducted in a fairand transparent manner by adopting high standards of professionalism honesty integritythe company has a adopted a vigil mechanism policy. This policy is explained in CorporateGovernance and also posted on Company's website www.khaitansugar.in.
DEVELOPMENT AND IMPLEMENTAION OF RISK MANAGEMENT POLICY
The Company has adopted risk management policy which covers assessment of various risksimpacting the business of the company. The policy covers framework to identity evaluateand mitigate business risk. The Risk Management policy has been uploaded on the website ofthe Company www.khaitansugar.in.
The Board has on the recommendations of Nomination & Remuneration Committee frameda policy of selection/ appointment of Directors Senior Management Personal and theirremuneration policy is stated in Corporate Governance Report.
DIRECTORS' RESPONSIBILITY STATEMENT
Directors responsibility statement pursuant to section 134(3)(c) of the Companies Act2013 is attached as Annexure -lV.
RELATED PARTY TRANSACTIONS
All Transaction entered into with related parties as defined the Companies Act 2013and Regulation 23 of the SEBI (Listing Obligations and Disclosure Requirements) Regulation2015 during the financial year were in the ordinary course of business and on arm'slength basis. All related party transactions are placed before the audit Committee andalso the Board for approval. Particulars of contracts or arrangement with relate partiesreferred to in sub section (i) of section 188 have been given in the prescribed form AOC-2 as Annexure -V.
The policy on Related Party Transaction as approved by the Board is uploaded on theCompany's website www.khairansurar.in
M/s V.K.Tulsyan & Co.LLP. Reg. No. FRN 326740E/E300015) Chartered Accountantshave been appointed as Statutory Auditors of the company at the Annual General Meetingheld on 28th September 2018 for a period of 5 years. M/s V. K. Tulsyan & Co.LLP hadresigned as Statutory Auditors on 14.11.2019. The Board of Directors had accepted itsresignation and appointed M/s K. C. Bhattacherjee & Paul Chartered AccountantsSiddhartha Block -B 7C 14/2 Burdwan Road Alipore Kolkata - 700027 (Reg.No. 303026E) in the meeting held on 19.12.2019 to fill the casual vacancy by theresignation of M/s V. K. Tulsyan & Co.LLP. As per Section 139(8) of the Companies Act2013 M/s K. C. Bhattacherjee & Paul Chartered Accountants appointment was approved bythe Shareholders in the Extra Ordinary General Meeting held on 11th March 2020. M/s K. C.Bhattacherjee & Paul Chartered Accountants retire at ensuing Annual General Meetingand are eligible for the re-appointment.
The Board has duly examined the Statutory Auditor's Report to Financial Statement. Thereply of the management in regard to qualification in the auditor's report is as follows:
i. Balance of deferred tax assets has not been carried in the financial statements atRs. 32643751/-. Considering the absence of the reasonable certainty as regards torealization of the said balances in the coming years the same needs to be provided for.Had the said balance of Deferred Taxes has benne fully provided for the losses would havegone up by Rs. 70641706/- and the net worth would have reduced by the said extent. Thereply of the company is that Deferred Tax Asset's balance represents brought forwardbalance for earlier years which shall be written off in due course.
ii. In terms of the requirements of Ind As109 Financial Instruments the company hasnot opted for Expected Credit Loss (ECL) model for estimating the provisions against TradeReceivables. Had the said model of estimation of receivable delinquencies been applied thebalances of provisioning against trade receivables might undergone a change. The possibleeffect of the non-application of ECL model on the financial statements is un-ascertained.The reply of the company in this relation is that the company has not opted for ExpectedCredit Loss (ECL) model for estimating the provisions against Trade Receivables asmanagement believes that there will be no material difference in the value of realizationof Trade Receivable.
iii. The biological assets amounting to Rs. 25700854/- includes Bearer and NonBearer plants and trees. As per Ind AS-16 Property Plant & Equipment bearer plantis a part of Fixed Assets and depreciation to be charged on the basis of useful life ofthe bearer plants. The company has not segregated the portfolio of biological assets in tobearer and non-bearer plants and consequent accounting adjustment thereof and continues torecognize the same under current assets which is in disagreement with the requirements ofthe above referred Ind As Accounting standard Pending completion of the said exercisethe consequent impact of the above matter on the financial statements could not beascertained. The company's reply is that due to Covid -19 related reason this could not beundertaken as on 31.03.2020. The management has takenup the task of segregating thebiological assets in the respective classes and is expecting to complete the same duringcurrent year.
Detail of fees paid to the statutory auditor and all entities in the networkfirm/network entity of which the statutory auditor is a part is given in enclosedFinancials for the year 2018-2019 and 2019-2020.
Pursuant to the provision of Section 204 of the Companies Act 2013 and The Companies(Appointment and Remuneration of Managerial Personnel) Rule 2014 the Company hadappointed Ms. Nisha Munka (ACS No. 49058 CP No. 18201) Company Secretary in Practice toundertake the Secretarial Audit of the Company for the FY 2019-20. The Secretarial AuditReport is annexed herewith as Annexure -Vl.
The Qualifications therein are self explanatory and management's response is alsocovered therein.
Total fees paid by the Company to the auditors during the year 2018-2019 and 2019-2020is given below:-
CERTIFICATION FROM COMPANY SECRETARY IN PRACTICE
A certificate has been received from M/s. Nisha Munka Practising Company Secretariesthat none of the Directors on the Board of the Company have been debarred or disqualifiedfrom being appointed or continuing as Directors of companies by the Securities andExchange Board of India Ministry of Corporate Affairs or any such statutory authority.The Certificate for the year 2018-2019 and 2019-2020 are attached as Annexure - VII tothis Report.
Your Company's in house internal audit department carries out internal audits acrossall location of the county. Their objective is to assess the existence adequacy andoperation of financial and operating controls set up by the Company and to ensurecompliance with the Companies Act 2013 SEBI (Listing Obligations & DisclosuresRequirements) Regulations 2015 (SEBI Listing Regulations 2015 and corporate policiesInternal Auditors Reports are reviewed by the Audit Committee. The Company has thought tohave in house internal audit department to conduct internal audit in future.
DIRECTORS' REPORT (Contd.)
Your Board had appointed M/s AB & Co. (Reg. No. 00256) qualified Cost Accountantsto carry out Cost Audit of the cost Accounts maintained by the Company in respect of sugarDivision for FY 2019-20. However as sugar mill could not start operation during year costaudit was not conducted. SUBSIDIARY COMPANY The Company doesn't have any subsidiary.
MATERIAL CHANGES AND COMMITMENT AFFECTING FINANCIAL POSITION OF THE COMPANYT
There are no material changes and commitment affection financial position of thecompany which has occurred between the end of financial year of the company i.e. 31stMarch 2020 and till the date of report.
DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE
The Company has in place a policy in line with the requirements of The SexualHarassment or Women at Workplace (Prevention Prohibition & Redressal) Act 2013Internal Complaints Committee (ICC) has been set up to redress complaints receivedregarding sexual harassment. All employees (permanent contractual trainees) are coveredunder this Policy. During the year under review no complaints were received.
INTERNAL FINANCIAL CONTROLS WITH REEFERENCE TO FINANCIAL STATEMENT
The Company has adequate financial control procedures commensurate with its size and ofbusiness the company has identified and documented all key internal financial controlswhich impact the financial statements as a part of its Standard Operating Procedure(SOP). The SOPs are designed for critical processes across all branches wherein financialtransactions are undertaken.
SIGNIFICANT AND MATERIAL ORDERS PASSED BY REGULATOURS OR COURTS
There are no significant material orders passed by the regulators/courts which wouldimpact the going concern status of the company and its future operations.
The Company has been well supported from all the quarters and therefore your directorswish to place on record their sincere appreciation for the support and co-operation fromEmployees Supplies Government of West Bengal cane growers depositors and theshareholders.