Mishtann Foods Ltd.
|BSE: 539594||Sector: Agri and agri inputs|
|NSE: N.A.||ISIN Code: INE094S01041|
|BSE 09:51 | 30 Sep||9.00||
|NSE 05:30 | 01 Jan||Mishtann Foods Ltd|
|Mkt Cap.(Rs cr)||900|
|Mkt Cap.(Rs cr)||900.00|
Mishtann Foods Ltd. (MISHTANNFOODS) - Director Report
Company director report
Mishtann Foods Limited
Your Directors have immense pleasure in presenting Annual Report of theCompany together with Audited Statement of Accounts for the financial Year ended 31stMarch 2021.
STATE OF AFFAIRS OF THE COMPANY
The Company is primarily engaged in the agricultural business i.emanufacturing processing & trading of rice wheat and other food grains.
(Amount in Rs.)
Above mentioned figures are derived from audited Standalone BalanceSheet for the financial year ended 31st March 2021.
IMPACT OF COVID-19
I Due to the current pandemic of Covid-19 markets got disturbed.Though our product falls is essential goods but still sales were affected for the periodApril-21 to May-21 due to complete lockdown in the country. Even after 2 Month's completelockdown company faced problem of labour and transportation to supply company's productin the market for some time.
During FY 2020-21 due to Covid-19 pandemic situation other businesssectors like hotel Restaurant Grocery Malls were also affected. Which lead to falls inMarket demand of Company's product.
The Company has tried its best to achieve their Market goals and tokeep their presence in the Market.
With positive outlook innovative business model and work commitmenteven in these uncertain time due to the pandemic the Company is anticipating to navigatethe challenges ahead and gain better momentum in the near future
During the year under the review the paid up share capital of thecompany has been stood at 500000000 of face value of Re. 1/- each. The Company has notissued shares or convertible securities or shares with differential voting rights nor hasgranted any stock options or sweat equity or warrants. As on 31st March 2021 none of theDirectors of the Company hold instruments convertible into Equity Shares of the Company.
The Company has though not made a remarkable profit during the yearthe Board of directors recommended final dividend @ 0.1% i.e Rs. 0.001/- per equity shareof face value Re. 1 each amounting to Rs. 500000/- to its equity shareholders.
TRANSFER OF UN-CLAIMED DIVIDENDS
The Company does not have any funds lying as unpaid or unclaimed for aperiod of seven years. Therefore there were no funds which were required to betransferred to Investor Education and Protection Fund (IEPF).
During the year under review Rs. 7336396 has been transferred toGeneral Reserves.
CHANGE IN NATURE OF BUSINESS
During the Financial Year 2020-21 the Company has not commenced any newbusiness nor discontinued/sold or disposed of any of its existing businesses or hived offany segment or division. disposed of any of its existing businesses or hived off anysegment or division.
DETAILS OF SUBSIDIARY/JOINT VENTURES/ASSOCIATE COMPANIES
The Company does not have any subsidiary/Joint Venture/AssociateCompanies in terms of provisions of Companies Act 2013..
The Company has ISO certification for Food Safety (ISO22000:2018).
The Company is registered with Agricultural and Processed FoodProducts Export Development Authority.
Mishtann is a committed member of All India Rice ExporterAssociation.
DIRECTORS AND KEY MANAGERIAL PERSONNEL APPOINTED AND RESIGNED DURINGTHE YEAR
Mr. Navinchandra Dahyalal Patel (DIN: 05340874) and Mr. KevalManuprasad Bhatt (DIN: 07620270) Directors retire by rotation at the forthcoming AnnualGeneral Meeting and being eligible offer themselves for reappointment.
During the year under review the following Directors and Key ManagerialPersonnel were appointed and resigned:
PARTICULARS OF EMPLOYEES& EMPLOYEE REMUNERATION
Information as required under Section 197(12) of the Companies Act2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014 and a statement showing the names and other particulars of theemployees drawing remuneration in excess of the limits set out in Rule 5(2) and 5(3) ofthe Companies (Appointment & Remuneration of Managerial Personnel) Rules 2014 isannexed hereto as "Annexure - A" and forms part of this report.
None of the employees of the Company drew remuneration of Rs.10200000/- or more per annum and Rs. 850000/- or more per month during the year. Noemployee was in receipt of remuneration during the year or part thereof which in theaggregate at a rate which is in excess of the remuneration drawn by the managing directoror whole-time director or manager and holds by himself or along with his spouse anddependent children not less than two percent of the equity shares of the company. Henceno information is required to be furnished as required under Rule 5(2) and 5(3) of TheCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014.
During the year Five Board Meetings were duly held. The details ofwhich are given in the Corporate Governance Report. The intervening gap between theMeetings was within the period prescribed under the Companies Act 2013.
The Board has following Committees viz
Stakeholders' Relationship Committee
Nomination and Remuneration Committee
Corporate Social Responsibility Committee
The details of the Committees along with their composition number ofmeetings and attendance at the meetings are provided in the Corporate Governance Report.
FORMAL ANNUAL EVALUATION
Pursuant to the requirements of Section 134(3)(p) of the Companies Act2013 read with Regulation 17 of the listing regulations the Board has carried out anannual performance evaluation of its own performance the directors individually as wellas the evaluation of its Committees. A structured questionnaire was prepared after takinginto consideration inputs received from the Directors covering various aspects of theBoard's functioning such as adequacy of the composition of the Board and its CommitteesBoard culture execution and performance of specific duties obligations and governance. Aseparate exercise was carried out to evaluate the performance of individual Directorsincluding the Chairman of the Board who were evaluated on parameters such as level ofengagement and contribution independence of judgment safeguarding the interest of theCompany and its minority shareholders etc. The performance evaluation of the IndependentDirectors was carried out by the entire Board. The Directors expressed their satisfactionwith the evaluation process.
STATEMENT OF DECLARATION BY INDEPENDENT DIRECTOR(S)
Pursuant to the requirements of Section 149(7) of the Companies Act2013 the company has received the declarations from all the independent directorsconfirming the fact that they all are meeting the eligibility criteria as stated inSection 149(6) of the Companies Act 2013.
The Independent Directors have complied with the Code of Conduct forIndependent Directors prescribed in Schedule IV of the Companies Act 2013 and the Code ofconduct formulated by the Company as hosted on the Company's Website i.e. www.Mishtann.com.
The Board is satisfied of the integrity expertise and experience(including proficiency in terms of Section 150(1) of the Act and applicable rules thereunder) of all Independent Directors on the Board. Further in terms of Section 150 readwith Rule 6 of the Companies (Appointment and Qualification of Directors) Rules 2014 asamended Independent Directors of the Company have included their names in the data bankof Independent Directors maintained with the Indian Institute of Corporate Affairs.
NOMINATION AND REMUNERATION POLICY
The Board has on the recommendation of the Nomination &Remuneration Committee framed a policy for selection and appointment of Directors SeniorManagement and their remuneration. The salient features of Nomination & RemunerationPolicy of the Company is disclosed in the Corporate Governance Report the web address ofthe Nomination and Remuneration policy ishttp://www.mishtann.com/relation.php?category=disclosures-and -policies
AUDIT AND AUDITORS
Pursuant to the provisions of Section 139(2) of the Companies Act 2013and rules made there under M/s. J.M. Patel & Bros. Chartered Accountants Ahmedabad
Firm Registration No. 107707W) were appointed as Statutory Auditors ofthe Company for period of 5 years to hold office upto the conclusion of 43rd AnnualGeneral Meeting of the Company.
The Auditors' Report for the financial year 31st March 2021 isunmodified i.e. It does not contain any qualification reservation adverse remark ordisclaimer. The Statutory Auditors have not reported any incident of fraud to the AuditCommittee of the Company during the financial year under review.
Pursuant to the provisions of Section 204 of the Companies Act 2013and the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 theBoard of Directors appointed Mr. Kamlesh M. Shah Practicing Company SecretariesAhmedabad to undertake the Secretarial Audit of your Company for the financial year2020-2021 in the duly convened Board Meeting on June 29 2020.
The Secretarial Auditor Report in the Format MR-3 is annexed to thisReport as "Annexure - B"
QUALIFICATION RESERVATION OR ADVERSE REMARK IN THE AUDITOR'SREPORTS AND SECRETARIAL AUDIT REPORT
There has been no qualification reservation adverse remark ordisclaimer given by the Secretarial Auditors in their Report except the following:
1. The company has made non-compliance of Regulation 17(1) of LODR andpaid penalty of Rs. 259600/-(BSE) and 259600/-(MSEI) during the year under review.
Board's Explanation: The company has paid the penalty as levied bythe Bourses for non-compliance of Regulation 17(1) of SEBI LODR 2015 and complied withthe same.
2. The Company has paid penalty u/r 13(3) of SEBI (LODR) Regulations2015 for non- redressal of investors complaints of Rs. 331580/- in total during the yearunder review.
Board's Explanation: The company has paid the penalty as levied bythe Bourses for non-compliance of Regulation 13(3) of SEBI LODR 2015 and resolved all theInvestors complaints satisfactorily.
3. The company has paid penalty of Rs. 1500000/- for non-complianceof the order of WTM of SEBI dated 20-02- 2021.
Board's Explanation: The Company paid the penalty levied fornon-compliance of the order of WTM of SEBI under section 15HB dated 20-02-2021 andcomplied with the same.
4. The Company has not deposited the unspent amount of CSR Expenditureinto separate Account as per Section 135(6) of CA 2013 for the FY 2018-19 2019-2020 and2020-2021.
Board's Explanation: Due to COVID-19 Pandemic the company was notable to deposit the unspent amount of CSR Expenditure into separate Account as per Section135(6) of CA 2013 for the FY 2018-19 2019-2020 and 2020-2021. The Board assures eitherto deposit the same at the earliest or spend the unspent amount in the upcoming financialyear.
Board's Explanation: The company has no employees in continuousservices for five years therefore has not made any provision for payment of Gratuity andalso had not done assessment of Gratuity Liability as per Accounting Standard-15.
In accordance with the SEBI Circular dated February 8 2019 read withRegulation 24A of SEBI Listing Regulations the Company has obtained an Annual SecretarialCompliance Report from M/s. Kamlesh M. Shah Practising Company Secretaries confirmingcompliances with all applicable SEBI Regulations Circulars and Guidelines for the yearended March 312021
INTERNAL AUDIT & CONTROLS
The company has appointed Mr. Gaurang Khatri as an internal auditor forFY 2020-2021 the accounting and other system have been designed in such a manner thatreview of entire process for safeguarding the assets of the company its operationalefficiency and effectiveness of the systems are taken care of properly. Their scope ofwork includes review of processes for safeguarding the assets of the Company review ofoperational efficiency effectiveness of systems and processes and assessing the internalcontrol strengths in all areas. Internal Auditors findings are discussed with the processowners and suitable corrective actions taken as per the directions of Audit Committee onan ongoing basis to improve efficiency in operations.
DETAILS IN RESPECT OF ADEQUACY OF INTERNAL FINANCIAL CONTROLS WITHREFERENCE TO THE FINANCIAL STATEMENTS
Your Company has in place adequate internal financial controlscommensurate with its size scale and operations. Such controls have been assessed duringthe year under review taking into consideration the essential components of internalcontrols stated in the Guidance Note on Audit of Internal Financial Controls overFinancial Reporting issued by the Institute of Chartered Accountants of India. Based onthe results of such assessments carried out by the management no reportable orsignificant deficiencies no material weakness in the design or operation of any controlwas observed. Nonetheless your Company recognizes that any internal control framework nomatter how well designed has inherent limitations and accordingly regular audits andreview processes ensure that such systems are re-enforced on an ongoing basis. Theinternal financial controls with reference to the Financial Statements are commensuratewith the size and nature of business of the Company.
EXTRACT OF ANNUAL RETURN
The Annual Return for financial year 2020-21 as per provisions of theAct and Rules thereto will be available on the Company's website athttp://www.mishtann.com/relation.php?category=annual- return
In pursuant to the provisions of section 177(9) & (10) of theCompanies Act 2013 and Regulation 22 of SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 a Vigil Mechanism for directors and employees to reportgenuine concerns has been established. The web link of Vigil Mechanism Policy on thewebsite of the Company ishttp://www.mishtann.com/relation.php?category=disclosures-and-policies
RISK MANAGEMENT POLICY
Our continuous endeavours comprise scanning our business landscape toidentify and grade emerging risk pools and adopting all possible actions to limit ormitigate the negative impact of those risks or capitalise on or amplify their positiveimpacts. Though we are focused on fostering a risk-aware culture we consider calculatedrisk as a means to achieve sustainable and fast-tracked growth especially as a growth-oriented enterprise. Yet we embrace all possible measures to mitigate any negativefallouts thus protecting long-term value.
Our business and financial results could be negatively impacted by thesecond or third waves of the COVID-19 pandemic. The severity magnitude and duration ofthe current COVID-19 pandemic is uncertain and rapidly changing. In the year 2020 thepandemic significantly impacted economic activity and markets around the world. At ourCompany we have been actively monitoring the outbreak of COVID-19 and its impactglobally.
While some of the initial impacts of the pandemic on our businessmoderated in the second and third quarter of 2020- 21 the business and economicenvironment remains uncertain and additional impacts may arise that remain unanticipated.Barring any material business disruptions or other negative developments we expect tocontinue to meet the demand of consumers for our products.
The risk management framework is reviewed periodically by the Board andthe Audit Committee. Some of the risks that the company is exposed to are:
Commodity Price Risks
The Company is exposed to the risk of price fluctuation of raw materialas well as finished goods. The company proactively manages these risks through forwardbooking Inventory management and proactive vendor development practices. The Company'sreputation for quality product differentiation and service coupled with existence ofpowerful brand image with robust marketing network mitigation the impact the impact ofprice risk on finished goods.
The company is exposed to risks attached to various statues andregulations including the company Act. The company is
* Regulatory Risks
The company is exposed to risks attached to various statues andregulations including the company Act. The company is mitigating these risks throughregular review of legal compliances carried out through internal as well as externalcompliance audits.
Human Resources Risks
Retaining the existing talent pool and attracting new talent are majorrisks. The company has initialed various measures including rolling out strategic talentmanagement system training and integration of learning and development activities.
Emerging businesses capital expenditure for capacity expansion etc.are normal strategic risk faced by the company. However the company has well-definedprocesses and procedures for obtaining approvals for investments in new business andcapacity expansion etc.
* Competition Risks
The food grains industry is highly competitive with a number ofglobal pan-India regional and local companies. Failure to effectively addresscompetitive challenges could adversely affect our business.
MATERIAL CHANGES AND COMMITMENTS IF ANY AFFECTING THE FINANCIALPOSITION OF THE COMPANY WHICH HAVE OCCURRED BETWEEN THE END OF THE FINANCIAL YEAR OF THECOMPANY TO WHICH THE FINANCIAL STATEMENTS RELATE AND THE DATE OF THE REPORT
During the Financial Year 2020-2021 there were no Material changesoccurred subsequent to the close of the financial year of the Company to which the balancesheet relates and the date of the report.
DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS ORCOURTS OR TRIBUNALS IMPACTING THE GOING CONCERN STATUS AND COMPANY'S OPERATIONS IN FUTURE
During the Financial Year 2020-2021 SEBI has passed an order imposingRs. 1500000/- penalty under Section 15HB of SEBI Act for Non-compliance of order dateFebruary 20 2020 passed by the Whole Time Member of the SEBI.
Your Company has not accepted / renewed any deposits from the publicduring the Financial Year 2020-2021.
PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS UNDER SECTION 186
Particulars of loans given investments made guarantees and securitiesprovided under section 186 of the Companies Act 2013 are provided in the notes ofStandalone Financial Statement.
PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES
All transactions executed by the Company during the financial year withrelated parties were on arm's length basis and in ordinary course of business. All suchrelated party transactions were placed before the Audit Committee for approval whereverapplicable. Particulars of the contracts or arrangement with related parties referred intoSection 188 (1) of the Companies Act 2013 in prescribed Form AOC -2 is attached as"Annexure - C".
The Company has been proactive in the following principles andpractices of good corporate governance. A report in line with the requirements ofRegulation 27(2) of SEBI (Listing Obligations and Disclosure Requirements) Regulations2015 the report on Management Discussion and Analysis and the Corporate Governancepractices followed by the Company and the Auditors Certificate on Compliance of mandatoryrequirements are given as an "Annexure - D" respectively to this report.
Your Company is committed to the tenets of good Corporate Governanceand has taken adequate steps to ensure that the requirements of Corporate Governance aslaid down in Regulation 27(2) of SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 are complied with.
As per 27(2) of SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 with the Stock Exchange the Corporate Governance Report ManagementDiscussion and Analysis and the Auditor's Certificate regarding compliance of conditionsof Corporate Governance are attached separately and form part of the Annual Report.
Management Discussion and Analysis
The Management Discussion and Analysis as required in terms of the SEBIListing Regulations is annexed to the report.
OBLIGATION OF COMPANY UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE(PREVENTION PROHIBITION AND REDRESSAL) ACT 2013
Company has only one female Employee it is beyond the practicality toconstitute a local compliance committee but a system has been put in place to protectFemale Employee(s) from sexual harassment. During the year Company has not received anycomplaint of harassment.
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGEEARNINGS AND OUTGO
The Particulars regarding Conservation of Energy Technology Absorptionand Foreign Exchange Earnings and Outgo pursuant to Section 134(3)(m) of the CompaniesAct 2013 read with the Rule 8 of Companies (Account) Rules 2014 is given in "Annexure- E".
CORPORATE SOCIAL RESPONSIBILITY (CSR)
In compliance with the requirements of Section 135 read with ScheduleVII of the Companies Act 2013 the Board has constituted Corporate Social ResponsibilityCommittee.
The Annual Report on CSR activities as required under Companies(Corporate Social Responsibility Policy) Rules 2014 is set out as "Annexure -F" forming part of this Report.
Brief terms of reference for the CSR Committee include:
To formulate a CSR policy which shall indicate activities to beundertaken by the Company.
To recommend the CSR policy to the Board.
To recommend the amount of expenditure to be incurred on theactivities.
To monitor the policy from time to time as per the CSR policy.
The complete policy of Corporate Social Responsibility is displayed onthe company's website at i.e.http://www.mishtann.com/uploads/specifcation/Mishtann%20Foods%20Limited-%20Corporate%20Social%20Responsibility%20Policy.pdf
DIRECTORS' RESPONSIBILITY STATEMENT
The Directors' Responsibility Statement referred to in clause (c) ofsub-section (3) of Section 134 of the Companies Act 2013 shall state that-
a) In the preparation of the annual accounts the applicable accountingstandards had been followed along with proper explanation relating to material departures;
(b) the directors had selected such accounting policies and appliedthem consistently and made judgments and estimates that are reasonable and prudent so asto give a true and fair view of the state of affairs of the company at the end of thefinancial year and of the profit and loss of the company for that period;
(c) The directors had taken proper and sufficient care for themaintenance of adequate accounting records in accordance with the provisions of this Actfor safeguarding the assets of the company and for preventing and detecting fraud andother irregularities;
(d) The directors had prepared the annual accounts on a going concernbasis; and
(e) The directors had laid down internal financial controls to befollowed by the company and that such internal financial controls are adequate and wereoperating effectively.
(f) The directors had devised proper systems to ensure compliance withthe provisions of all applicable laws and that such systems were adequate and operatingeffectively
MAINTENANCE OF COST RECORDS
The Central Government has not specified for the maintenance of costrecords under section 148(1) of the Act for any goods sold or services rendered by thecompany.
LISTING WITH STOCK EXCHANGES
The Company has listed its Equity Shares on BSE Limited andMetropolitan Stock Exchange of India Limited.
The Directors State that applicable Secretarial Standards - 123 and 4issued by the Institute of Company secretaries of India relating to 'Meetings of the Boardof Directors' and General Meetings' 'Payment of Dividend' and 'Report of the Board ofDirectors' respectively have been duly followed by the Company.
Your directors' wish to place on record their sincere gratitude andappreciation to its members employees bankers financial institutions Central &State Government Agencies for their valuable contribution in the growth of theorganization.