Milestone Furniture Limited
(Earlier known as Milestone Furniture Private Limited)
Your Directors are pleased to present their 5th AnnualReport together with the audited accounts of the Company for the year ended as on March31 2019.
|Particulars||Year ended March 312019||Year ended March 31 2018|
|Profit/ (Loss) before tax||1315288||14871627|
|Less: Taxation Expenses||393746||3286063|
|Profit /(Loss) after tax||921542||11585564|
|Balance of profit/ (loss) for earlier years||17708377||6122813|
|Balance carried forward||18629919||17708377|
The Total income of your Company is Rs. 81567605/- as against Rs.253913044/- in the previous year 2017-18. The net profit after tax for the year underreview is Rs. 921542/- as against Rs. 11585564/- in the previous year 2017-18.
TRANSFER TO RESERVES.
The Board of directors has not proposed transfer to any reserve in thecurrent financial year.
With a view to conserve the resources your Directors do not recommendany dividend for the financial year 2018-2019.
SUBSIDIARIES JOINT VENTURE AND ASSOCIATE COMPANIES:
The Company does not have any subsidiary joint venture and associatecompany and therefore disclosure in Form AOC-1 is not applicable.
MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OFTHE COMPANY BETWEEN THE END OF FINANCIAL YEAR AND DATE OF REPORT
There were no material changes and commitments affecting the financialposition of the Company between the end of financial year and date of the report.
CHANGE IN THE NATURE OF BUSINESS:
There has been no change in the nature of business of the Companyduring the year under review.
PARTICULARS OF LOANS GIVEN INVESTMENT MADE GUARANTEE GIVEN ANDSECURTIES PROVIDED.
In accordance with the provisions of Sections 134(3)(g) and 186(4) ofthe Companies Act 2013 full particulars of loans given investments made guaranteesgiven and securities provided if any have been disclosed in the financial statements.
RELATED PARTY TRANSACTIONS
All related party transactions that were entered during the financialyear were on arm's length basis and were in the ordinary course of business. Thereare no significant related party transactions made by the Company with PromotersDirectors Key Managerial Personnel or other designated persons which may have a potentialconflict with the interest of the Company at large.
Accordingly particulars of contracts or arrangements with relatedparty referred to in section 188(1) along with the justification for entering into suchcontract or arrangement in Form AOC-2 does not form part of the report.
COMPLIANCE WITH SECRETARIAL STANDARDS
The Company has complied with Secretarial Standards issued by theInstitute of Company Secretaries of India on Board Meetings and Annual General Meetings.
SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS ORTRIBUNALS:
During the financial year ended 31st March 2019 there wereno such material orders passed by the regulators or courts or tribunals impacting thegoing concern status and Company's operations in future.
EXTRACTS OF ANNUAL RETURN:
An extract of the Annual Return in Form MGT-9 is appended as an AnnexureA to the Directors Report.
During the financial year 2018-19 there was no change in theAuthorized Issued Subscribed and Paid-up Share Capital of the Company. As on March 312019 the Company was having Authorized Share Capital of Rs. 100000000/- comprising of10000000 equity shares of Rs. 10/- each out of which Issued Subscribed and Paid-upShare Capital was Rs. 92970000/- comprising of 9297000 equity shares of Rs. 10/-each.
ISSUE EQUITY SHARES AND OFFERED TO THE PUBLIC & LISTING:
During the year under review the Company has issued and made onallotment of equity shares to Public by Initial Public Offer of equity shares. Our Companyhas obtained the necessary listing permission from BSE Ltd. for listing of Equity Share onBSE-SME plate form.
Public Issue of 3297000 Equity Shares of Rs. 10/- each fully paid forcash at a price of Rs.45/- per equity share aggregating to Rs. 148365000/-. The Netissue will constitute 35.46% of the post issue paid up capital of the Company. YourCompany has received good response from public.
The allotment of equity share was carried and approved by StockExchange on 23rd April 2018 and listing of equity on BSE SME platform on 21stMay 2018.
All the new Equity Shares so allotted rank pari-passu in all respectwith the existing Equity Shares.
USE OF PROCEEDS:
The fund raised during the IPO will help your company to strengthenlong term working capital. The proceeds from IPO have been utilised for the purpose of theobjects as stated in the prospectus dated 23rd April 2018 as follows:
|Particulars||Proposed amount as per prospectus Rs. In Lakhs|
|To set up the manufacturing facility to make modular and innovative furniture with industrial premises.||906.85|
|Working capital requirement||350.00|
|General Corporate Expenses||176.80|
|To meet Public Issue Expenses||50.00|
As per the prospectus the Company has raised fund through IPO theobjects of raising this amount as mentioned in the prospectus was as mentioned above.
However due to economic slowdown & change in demand patternManagement has made change in business strategy after the consultation with Board andapproval in Board Meeting. Management has decided to utilised the IPO proceed as suggestedby Board members toward the repayment of Debts Creditor Liabilities and for workingcapital for ongoing business and new products such as Curtain and Bed Lenin for E-commerceand corporate clients office Furnitures.
Management at the forthcoming Board Meeting and AGM shall take thenecessary approval from the directors and shareholders. Post approval from ShareholdersManagement shall intimate to stock exchange and ROC for the necessary changes. Managementshall take necessary steps to ensure that effect of the changed objects shall be reflectedin the financial of the Company and wherever required.
DEMATERIALIZATION OF SHARES:
During the year under review the Company has entered into TripartiteAgreement with the depositories National Securities Depository and with CentralDepository Service (India) Limited for providing demat facility to its Shareholders. Forthe purpose the Company has appointed Karvy Fintech Private Limited.
DIRECTORS AND KEY MANAGERIAL PERSONEL:
The Directors on the Board have submitted notice of interest underSection 184(1) intimation under Section 164(2) of the Companies Act 2013 and declarationas to compliance with the Code of Conduct of the Company. All Independent Directors havealso given declarations that they meet the criteria of independence as laid down underSection 149(6) of the Companies Act 2013.
Mr. Shantaram Prahalad Badai and Mr. Ashis Satpathy IndependentDirector of the Company have resigned from the post of Director w.e.f. 24thDecember 2018.
Ms. Sushama Sampat Nevase has resigned from the post of Director w.e.f.5th December 2018.
Mr. Zeshan Ali Ramzan Ali Sayed has resigned from the post of Directorw.e.f. 16th July 2018.
Mr. Kamlesh Vyas has resigned from the post of Company Secretary andCompliance officer of the Company w.e.f. 16th July 2018 and Mr. Dilip G.Rajgor has resigned from the post of Chief Financial Officer (CFO) of the Company w.e.f.16th July 2018.
Ms. Akanksha Rai has appointed as Company Secretary and ComplianceOfficer of the Company w.e.f. 01st September 2018.
Mr. Amardeep Bhau Mahadik Independent Director of the Company hasresigned from the post of Director w.e.f. 23rd September 2019.
In accordance with the provisions of the Companies Act 2013 and theArticles of Association of the Company Mr. Digambar Sudam Songhare retires by rotation atthe forthcoming Annual General Meeting and being eligible offers himself forre-appointment.
MEETINGS OF THE BOARD:
During the year ended March 31 2018 the Board met 9 times. Theintervening gap between the Meetings was within the period prescribed under the CompaniesAct 2013 (the Act). Required quorum was present throughout each meeting asper the requirement of the said Act the details of attendance of Directors are givenbelow;
|Attendance of Directors|
|Sr. No.||Board Meeting Date ||Digambar S. Songhare||Ganesh Kumar Patlikadan||Shantara m Prahalad Badai||Sushama Sampat Nevase||Shivaji Laxman Dabhane||Ashis Satpath y||Zeshan Ali Sayed||Amard eep B. Mahadi k|
MEETING OF INDEPENDENT DIRECTOR:
The Meeting of the Independent Director held on 25th March2019.
The audit committee of the Company is constituted under the provisionsof section 177 of the Companies Act 2013.
Composition of the Committee:
1. Mr. Shivaji Laxman Dabhane Non-Executive Independent Director(Chairman);
2. Mr. Ashis Satpathy Non-Executive Independent Director (Member)Upto 24th December 2018 and
3. Mr. Digambar Sudam Songhare Managing Director(Member)
4. Mr. Amardeep Bhau Mahadik from 24th December 2018 (Member).
During the year under review the Company held 4 Audit Committeemeeting on 16th July 2018 14th November 2018 24thDecember 2018 and 25th March 2019.
NOMINATION AND REMUNERATION COMMITTEE:
The Nomination and Remuneration Committee of the Company is constitutedunder the provisions of section 178 of the Companies Act 2013.
Composition of the Committee:
1. Mr. Ashis Satpathy Non-Executive Independent Director (Chairman)Upto 24th December 2018;
2. Mr. Shivaji Laxman Dabhane Non-Executive Independent Director(Chairman) from 24th December 2018; and
3. Mr. Amardeep Bhau Mahadik Non-Executive Independent Director(Member);
4. Mr. Digambar Sudam Songhare Managing Director (Member) from 24thDecember 2018.
During the year under review the Company held 4 Nomination andRemuneration Committee meeting on 16th July 2018 1st September2018 5th December 2018 and 24th December 2018.
STAKEHOLDERS RELATIONSHIP COMMITTEE:
The Stakeholders Relationship Committee of the Company is constitutedunder the provisions of section 178 of the Companies Act 2013.
Composition of the Committee:
1. Mr. Shivaji Laxman Dabhane Non-Executive Independent Director(Chairman);
2. Mr. Zeshan Ali Sayed Non-Executive Independent Director (Member)upto 16th July 2018; and
3. Mr. Digambar Sudam Songhare Managing Director (Member);
4. Mr. Amardeep Bhau Mahadik Non-Executive Independent Director(Member).
During the year under review the Company held 2 StakeholdersRelationship Committee meeting on 14th November 2018 and 25thMarch 2019.
INTERNAL COMPLAINT COMMITTEE:
The Internal Complaint Committee of the Company is constituted pursuantto the provision Sexual Harassment of Women at Workplace (Prevention Prohibition andRedressal) Act 2013 (Act) in the Board Meeting held on 20thFebruary 2018.
Composition of the Committee:
|Name of the Director||Designation in the Committee|
|Mrs. Sushma S. Nevase (upto 5th December 2018.||Presiding Officer|
|Mr. Ganesh Kumar Patlikadan (from 5th December 2018)||Presiding Officer|
|Mr. Dilip Rajgor upto 16th July 2018.||Member|
|Mr. Rahul Ashirwar||Member|
|Mr. Shivaji Laxman Dabahane (From 16th July 2018||Member|
RISK MANAGEMENT POLICY
The Board of Directors of the Company has in place a Risk Managementwhich aims of enhancing shareholders' value and providing on optimum risk-rewardtrade off. The risk management approach is based on a clear understanding of the varietyof risks that the organisation faces disciplined risk monitoring and measurement andcontinuous risk assessment and mitigation measures.
The Board of Directors carried out an annual evaluation of the Boarditself its Committees and individual Directors. The entire Board carried out performanceevaluation of each Independent Director excluding the Independent Director beingevaluated. The Nomination Remuneration Committee also carried out evaluation of everydirector's performance.
The evaluation was done after taking into consideration inputs receivedfrom the Directors setting out parameters of evaluation. Evaluation parameters of theBoard and Committees were mainly based on Disclosure of Information Key functions of theBoard and Committees Responsibilities of the Board and Committees etc. Evaluationparameters of Individual Directors including the Chairman of the Board and IndependentDirectors were based on Knowledge to Perform the Role Time and Level of ParticipationPerformance of Duties and Level of Oversight and Professional Conduct etc.
Independent Directors in their separate meeting evaluated theperformance of Non-Independent Directors Chairman of the Board and the Board as a whole.
In terms of SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 exempts companies which have listed their specified securities on SMEExchange from compliance with corporate governance provisions.
Since the equity share capital of your Company is listed exclusively onthe SME Platform of NSE the Company is exempted from compliance with Corporate Governancerequirements and accordingly the reporting requirements like Corporate Governance ReportBusiness Responsibility Report etc. are not applicable to the Company.
MANAGEMENT DISCUSSION AND ANALYSIS REPORT:
The Management Discussion and Analysis report has been separatelyfurnished as Annexure-B in the Annual Report and forms a part of the Annual Report.
DIRECTORS' RESPONSIBILITY STATEMENT:
Pursuant to Section 134(5) of the Companies Act 2013 the Board ofDirectors to the best of their knowledge and ability confirm that:
a. In the preparation of the annual accounts for the year ended 31stMarch 2019 the applicable accounting standards have been followed and there are nomaterial departures;
b. They have selected such accounting policies and applied themconsistently and made judgments and estimates that are reasonable and prudent so as togive a true and fair view of the state of affairs of the Company at the end of thefinancial year as on 31st March 2019 and of the profit of the Company for thatperiod;
c. They have taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with the provisions of the Act for safeguardingthe assets of the Company and for preventing and detecting fraud and other irregularities;
d. They have prepared the annual accounts on a going concern basis;
e. They have laid down internal financial controls to be followed bythe Company and such internal financial controls are adequate and operating effectively;
f. They have devised proper systems to ensure compliance with theprovisions of all applicable laws and that such systems were adequate and operatingeffectively.
INTERNAL FINANCIAL CONTROLS:
The Board has laid down standards processes and procedures forimplementing the internal financial controls across the organization. After consideringthe framework of existing internal financial controls and compliance systems; workperformed by the Statutory Auditors Secretarial Auditors and External Consultants;reviews performed by the Management and relevant Board Committees including the AuditCommittee the Board is of the opinion that the Company's internal financial controlswith reference to the financial statements were adequate and effective during thefinancial year 2018-19.
INTERNAL CONTROL SYSTEMS:
Adequate internal control systems commensurate with the nature of theCompany's business and size and complexity of its operations are in place and havebeen operating satisfactorily. Internal control systems comprising of policies andprocedures are designed to ensure reliability of financial reporting timely feedback onachievement of operational and strategic goals compliance with policies procedureapplicable laws and regulations and that all assets and resources are acquiredeconomically used efficiently and adequately protected.
CORPORATE SOCIAL RESPONSIBILITY (CSR) EXPENDITURE.
Since the Company does not fall under the criteria stated under section135 of the Act the Company has not developed or implemented a policy for Corporate SocialResponsibility. In view of the same no CSR initiative was undertaken by the company.
AUDITORS AND AUDITORS' REPORT:
M/s. NGST & Associates and Associates (FRN: 135159W) CharteredAccountants who are the statutory auditor of the Company who holds office till theconclusion of the next AGM and are eligible for re-appointment. Pursuant to the provisionsof section 139(1) of the Companies Act 2013 and the Rules framed thereunder it isproposed to appoint M/s. NGST and Associates (FRN: 135159W) Chartered Accountants asstatutory auditor of the Company from the conclusion of the forthcoming AGM till theconclusion of the next Annual General Meeting. The Members are requested to consider theirre-appointment.
The Auditors' Report does not contain any qualification. Notes toAccounts and Auditors' remarks in their report are self-explanatory and do not call forany further comments.
In accordance with the provisions of Section 204 of the Companies Act2013 read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules2014 the Board has appointed M/s. Shivam Sharma & Associates Company Secretaries asSecretarial Auditors for the financial year 2018-19. The Secretarial Audit Report for thefinancial year ended 31st March 2019 is set out in Annexure-C to thisReport.
The Secretarial Audit Report contain qualification areself-explanatory.
As per provision of section 148(3) of Companies Act 2013 and rule 6(2)of Companies (Cost records and audit) Rules 2014 the Company is not required to appointa cost auditor to audit the cost records of the Company.
CONSERVATION OF ENERGY AND TECHNOLOGY ABSORPTION:
In view of the nature of activities which are being carried out by theCompany Rules 2A and 2B of the Companies (Disclosure of Particulars in the Report ofBoard of Directors) Rules 1988 concerning conservation of energy and technologyabsorption respectively are not applicable to the Company.
FOREIGN EXCHANGE EARNING AND OUTGO:
The foreign exchange earnings and outgo details are as below:
|Particulars||2018-19 (Rs.)||2017-18 (Rs.)|
|Foreign exchange earned in terms of actual inflows||Nil||Nil|
|Foreign exchange outgo in terms of actual outflows||Nil||Nil|
POLICIES AND DISCLOSURE REQUIREMENTS:
In terms of provisions of the Companies Act 2013 the Company hasadopted following policies.
Vigil Mechanism Policy
Code for Independent Directors
Nomination and Remuneration Policy
Risk Management Policy
Code of Conduct Director and Sr. Management
Code of Conduct for prevention of Insider Trading
Policy on Related Party Transactions
Your Directors state that no disclosure or reporting is required inrespect of the following items as there were no transaction on these items during the yearunder review.
1. Details relating to Deposits covered under Chapter V of the Act.
2. Issue of equity shares with differential rights as to dividendvoting or otherwise.
3. Issue of equity shares (including sweat equity shares) and ESOS toemployees of the Company under any scheme.
4. No significant or material orders were passed by the Regulators orCourts or Tribunals which impact the going concern status and Company's operations infuture.
5. There were no instance of non-exercising of voting rights in respectof shares purchased directly by the employees under a scheme pursuant to section 67(3) ofthe Act read with Rule 16(4) of Companies (Share Capital and Debenture) Rules 2014 andhence no information has been furnished.
Your Directors further state that during the year under review therewere no cases filed pursuant to the Sexual Harassment of Women at Workplace (PreventionProhibition and Redressal) Act 2013.
Your Directors would like to express their sincere appreciation of theco-operation and assistance received from Shareholders Bankers regulatory bodies andother business constituents during the year under review.
Your Directors also wish to place on record their deep sense ofappreciation for the commitment displayed by all executives officers and staff resultingin successful performance of the Company during the year. Your Directors look forward tothe continued support of all stakeholders in the future.
By order of the board
For Milestone Furniture Limited
Digambar Sudam Songhare