National General Industries Ltd.
|BSE: 531651||Sector: Metals & Mining|
|NSE: N.A.||ISIN Code: INE654H01011|
|BSE 00:00 | 17 Nov||National General Industries Ltd|
|NSE 05:30 | 01 Jan||National General Industries Ltd|
|BSE: 531651||Sector: Metals & Mining|
|NSE: N.A.||ISIN Code: INE654H01011|
|BSE 00:00 | 17 Nov||National General Industries Ltd|
|NSE 05:30 | 01 Jan||National General Industries Ltd|
Your Directors have pleasure in presenting the Thirty Third AnnualReport of your Company along with the Audited Statement of Accounts for the year ended 31stMarch 2019.
The financial performance of the Company for the financial year endedon 31st March 2019 and 31st March 2018 are summarized below:-
RESULTS OF OPERATIONS AND STATE OF COMPANY'S AFFAIRS
The Highlights of the Company's performance for the year ended on March31 2019 are as under: ^ Value of Sales and Services decreased by 2.61% to Rs. 1821.97lakhs.
^ PBDIT decreased by 27.29% to Rs. 105.96 lakhs.
^ PBT decreased by 52.74% to Rs. 38.78 lakhs.
^ Net Profit decreased by 55.52% to Rs. 30.17 lakhs.
CHANGE IN NATURE OF BUSINESS
There was no change in the nature of business of your company duringthe year.
Your Directors have not recommended dividend for the year ended 31stMarch 2019.
TRANFER TO RESERVES
The net movement in the Reserves of the Company is as under:
DEPOSITS FROM PUBLIC
During the year under review your Company did not invite / accept anyDeposits from the public under section 73 and 74 of the Companies Act 2013 read withCompanies (Acceptance of Deposits) Rules 1975.
EXTRACT OF ANNUAL RETURN
Pursuant to the Section 92(3) of the Companies Act 2013 extract of theAnnual Return is annexed to this report as Annexure I and forms part of this AnnualReport and is also available at the website of the company www.modisteel.net
NUMBER OF BOARD MEETINGS & ATTENDACE OF DIRECTORS
During the Financial Year 2018-19 5 (Five) Board Meetings were heldand the gap between two meetings did not exceed four months. The Board Meetings were heldon 30.05.2018 13.08.2018 14.11.2018 14.02.2019 and 30.03.2019.
The details of composition of the Board the attendance record of theDirectors at the Board Meetings held during the financial year ended on 31.03.2019 and atthe last Annual General Meeting (AGM) and the details of their other Directorships andCommittee Chairmanships and Memberships are given below:
Number of Equity Shares held by Directors as on 31st March2019 are as under:-
DIRECTORS & KEY MANAGERIAL PERSONNEL
In terms of Section 149 of the Act the Members at their meeting heldon 30th September 2014 appointed the following as Independent Directors of the Company:
Mr. Pankaj Aggarwal
Mr. Chaitanya Dalmia
Mrs. Abhilasha Goenka
All the above Directors resigned from the Board w.e.f. 30thMarch 2019 due to expiry of their terms of appointment.
Thereafter the Board at their meeting held on 30th March2019 appointed following as Independent Directors of the Company:
Mr. Anirudh Vimalkumar Goenka
Mr. Anantshri Gupta
Mrs. Sanjana Bharat
The Company has received the declaration under section 149(6) of theCompanies Act 2013 from the Independent Directors of the Company.
In terms of Section 203 of the Act the following are designated as KeyManagerial Personnel of your Company by the Board:
Mr. Ashok Kumar Modi Managing Director
Mr. Pawan Kumar Modi Joint Managing Director cum ChiefFinancial Officer
Mr. Vandana Gupta Company Secretary
In terms of section 152 of the Act and applicable provisions ofArticles of Association of the Company Mr. Vasu Modi Director retires by rotation and iseligible for re-appointment. The Board recommends his re-appointment as Director of theCompany.
AUDITORS & AUDITORS' REPORT
A. Statutory Auditors
M/s. N. R. & Company Chartered Accountants (Firm Registration No.: 015095C) were appointed as statutory auditors of the Company from the conclusion of the31st Annual General Meeting (AGM) of the Company held on September 26 2017 till theconclusion of the Annual General Meeting to be held in the year 2022 subject toratification of their appointment at every Annual General Meeting.
Since the requirement to place the matter relating to appointment ofStatutory Auditors for ratification by members at every Annual General Meeting is doneaway with vide The Companies (Amendment) Act 2017 (No. 1 of 2018) readwith notificationdated May 7 2018 issued by the Ministry of Corporate Affairs New Delhi no resolution isproposed for ratification of appointment of Statutory Auditors of the Company who wereappointed at the Annual General Meeting held on 26th September 2017 to holdoffice from the conclusion of that meeting till the conclusion of Annual General Meetingto be held in the year 2022.
B. Secretarial Auditors
M/s. Deepak Bansal & Associates Company Secretaries wereappointed as Secretarial Auditors to conduct Secretarial Audit of records and documents ofthe Company for financial year 2018-19. The Secretarial Audit Report is annexed to thisReport as Annexure II and forms part of the Annual Report.
C. Cost Auditors
In terms of provision of section 148(1) of the Companies Act 2013 readwith rule 4 of the Companies (Cost Records and Audit) Rules 2014 Company was notrequired to maintain cost records for the financial year 2018-19.
D. Internal Auditors
M/s. B.R.Maheswari & Co. Chartered Accountants (FRN 001035N)were Internal Auditors of the Company for the financial year 2018-19. Your Company hasappointed M/s. B.R.Maheswari & Co. Chartered Accountants as Internal Auditors of theCompany for the financial year 2019-20.
EXPLANATIONS OR COMMENTS ON QUALIFICATION RESERVATION OR ADVERSEREMARKS:
a) By Statutory Auditors :
There are no qualifications made by the Auditors in their Report whichrequires any explanation from the Board of Directors of the Company. The Notes to Accountsreferred to in the Auditors' Report are self-explanatory and do not call for any furthercomments.
b) By Secretarial Auditors :
There were no comments in the Secretarial Auditors Report whichrequires any explanation from the Board of Directors of the Company.
Neither the Statutory Auditors nor the Secretarial Auditors havebrought to the notice of the Audit Committee or the Board of Directors or the CentralGovernment the occurrence or brewing of any fraud in the Company.
CODE OF PRACTICES AND PROCEDURES FOR FAIR DISCLOSURE OF UNPUBLISHEDPRICE SENSITIVE INFORMATION
Your Company has adopted the "Code of Practices and Procedures forFair Disclosure of Unpublished Price Sensitive Information which inter alia prohibitspurchase or sale of securities of the Company by Directors employees and other connectedpersons while in possession of unpublished price sensitive information in relation to theCompany.
The Audit Committee is constituted under compliance of provision ofSection 177 of the Companies Act 2013. The Broad terms of reference and power of AuditCommittee are in line with the provisions contained under SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 and the Companies Act 2013.
The role of Audit Committee inter-alia includes following:
a) Reviewing the financial reporting process which includes reviewingthe quarterly half yearly annual financial results and auditors report thereondirector's responsibility statement.
b) Reviewing changes if any in accounting policies and practices andensures compliance with legal and statutory requirements and integrity of the Company'sfinancial statements with proper disclosures of related party transactions.
c) Recommendation for appointment remuneration and terms ofappointment of auditors and approval for their payments and also reviewing and monitoringtheir independence and performance and effectiveness of audit process.
d) Evaluation of internal control systems and its effectiveness andreviewing its adequacy.
e) Reviewing internal audit and discussion with the internal auditorsof any significant findings.
f) Review the findings of any internal investigations by the internalauditors into matters where there is suspected fraud or irregularity or a failure ofinternal control systems of a material nature and reporting the matter to the board.
g) Review Whistle Blower mechanism and its effectiveness.
h) Evaluating inter-corporate loans and investments and valuation ofassets of the Company and ensuring effective risk management systems.
During the financial year 2018-19 (upto 30th March 2019)the Audit Committee comprises of 3 Nonexecutive Directors viz. Shri Pankaj Agarwal andSmt. Abhilasha Goenka Independent Directors and Shri Vasu Modi Non-independent Director.Mr. Pankaj Agarwal is the Chairman of the Audit Committee. The Members of the AuditCommittee possess adequate knowledge of Accounts Audit Finance etc. The ComplianceOfficer of the Company acts as the Secretary to the Audit Committee.
Four meetings of the Audit Committee were held during the financialyear 2018-19 on 30.05.2018 13.08.2018 14.11.2018 and 14.02.2019. Further the Board ofDirectors at the meeting held on 30th March 2019 has re-constituted the AuditCommittee and hence the member of the Audit Committee as at 31.03.2019 and theirattendance of each Member during the year are as given below:
NOMINATION AND REMUNERATION COMMITTEE
The Nomination and Remuneration Committee is constituted undercompliance of provision of Section 178 of the Companies Act 2013. The Broad terms ofreference and power of Nomination and Remuneration Committee are in line with theprovisions contained under SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 and the Companies Act 2013.
The role of Nomination and Remuneration Committee inter-alia includesfollowing:
a) Formulation of the criteria for determining qualifications positiveattributes and independence of a director and recommend to the board of directors a policyrelating to the remuneration of the directors key managerial personnel and otheremployees.
b) Formulation of the criteria for evaluation of performance ofindependent directors and the board of directors;
c) devising a policy on diversity of board of directors;
d) identifying persons who are qualified to become directors and whomay be appointed in senior management in accordance with the criteria laid down andrecommend to the board of directors their appointment and removal.
e) whether to extend or continue the term of appointment of theindependent director on the basis of the report of performance evaluation of independentdirectors.
During the financial year 2018-19 (upto 30th March 2019)the Nomination and Remuneration Committee of the Board comprises of 3 Non-executiveDirectors viz. Shri Pankaj Agarwal and Smt. Abhilasha Goenka Independent Directors andShri Vasu Modi Non-independent Director. Mr. Pankaj Agarwal is the Chairman of theCommittee. Further the Board of Directors at the meeting held on 30th March2019 has re-constituted the Nomination and Remuneration Committee and hence the member ofthe Audit Committee as at 31.03.2019 and their attendance of each Member during the yearare as given below. The Compliance Officer acts as the Secretary to the Nomination andRemuneration Committee.
One meeting of the Nomination and Remuneration Committee were heldduring the financial year 2017-18 on 30.05.2018. The attendance of each Members of theCommittee is as given below:
STAKEHOLDERS RELATIONSHIP COMMITTEE
The Stakeholders Relationship Committee is constituted under complianceof provision of Section 178 of the Companies Act 2013. The Broad terms of reference andpower of Stakeholders' Relationship Committee are in line with the provisions containedunder SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 and theCompanies Act 2013.
The role of Stakeholders Relationship Committee inter-alia is toresolve the grievances of the security holders of the Company including complaints relatedto transfer and transmission of shares dematerialization / rematerialisation of sharestransposition of names consolidation of shares issue of duplicate share certificatesnon-receipt of annual report and non-receipt of declared dividends if any etc.
The Stakeholders Relationship Committee (upto 30th March2019) comprised of 3 directors as its Member viz. Shri Pankaj Agarwal and Smt. AbhilashaGoenka Independent Directors and Shri Vasu Modi Non-independent Director. Further theBoard of Directors at the meeting held on 30th March 2019 has re-constitutedthe Stakeholders Relationship Committee and hence the member of the StakeholdersRelationship as at 31.03.2019 and their attendance of each Member during the year are asgiven below. The Compliance Officer acts as the Secretary to the Stakeholders RelationshipCommittee.
During the year Committee met four times on 30.05.2018 13.08.201814.11.2018 and 14.02.2019 and the attendance of the Members at the meeting was asfollows:
The Board has designated Ms. Vandana Gupta Company Secretary of theCompany as Compliance Officer of the Company.
INTERNAL FINANCIAL CONTROLS
The Company has an Internal Control System commensurate with the sizescale and complexity of its operations. To maintain its objectivity and independence theInternal Audit function reports to the Chairman of the Audit Committee and to the Chairmanand Managing Director of the Board.
The Internal Audit Department monitors and evaluates the efficacy andadequacy of internal control system in the Company its compliance with operating systemsaccounting procedures and policies at all locations of the Company. Based on the report ofinternal audit function process owners undertake corrective action in their respectiveareas and thereby strengthen the controls. Significant audit observations andrecommendations along with corrective actions thereon are presented to the Audit Committeeand the Board.
MATERIAL CHANGES AFFECTING THE FINANCIAL POSITION OF THE COMPANY
There have been no material changes and commitments which can affectthe financial position of the company between the end of the period under review and dateof this report.
RISK MANAGEMENT COMMITTEE
In terms of regulation 15(2) of SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 compliance under regulations 21 is notapplicable to the Company as paid-up share capital of the Company is less than Rs. 10crore and net-worth of the Company is less than Rs. 25 crore as on the financial yearended on 31st March 2019 hence Risk Management Committee has not beenconstituted.
However the Board of Directors of your Company has on recommendationof the Audit Committee framed and adopted a policy on Risk Management of the Company.Major risks identified by the businesses and functions are systematically addressedthrough mitigating actions on a continuing basis.
DETAILS OF SUBSIDIARY JOINT VENTURES AND ASSOCIATE COMPANIES
The Company does not have any Subsidiary Company Associate Company orJoint Venture Company. The Company is not a Subsidiary Company of any other Company.
PARTICULARS OF CONTRACTS OR ARRANGMENTS WITH RELATED PARTY
All related party transactions done by the Company during the financialyear were at arm's length and in ordinary course of business. All related partytransactions were placed in the meetings of Audit Committee and the Board of Directors fortheir necessary review and approval. During the financial year your Company has notentered into any material transaction as mentioned in the Securities Exchange Board ofIndia (Listing Obligations and Disclosure Requirements) Regulations 2015 with any of itsrelated parties which may have potential conflict with the interest of the Company atlarge. Disclosures pursuant to Accounting Standards on related party transactions havebeen made in the note no. 26 to the Financial Statements.
PARTICULARS OF LOAN GUARANTEES SECURITIES AND INVESTMENTS
The Company has not given any loan guarantee or provided any securityunder Section 186 of the Companies Act 2013. Disclosure on details of investments madeduring the financial years which are covered under provisions of section 186 of theCompanies Act 2013 have been made in the note no. 30 to the Financial Statements.
DETAILS OF SIGNIFICANT & MATERIAL ORDERS PASSED BY THE REGULATORSOR COURTS OR TRIBUNAL
There are no significant material orders passed by the Regulators /Courts which would impact the going concern status of the Company and its futureoperations.
WHISTLE BLOWER/VIGIL MECHANISM
Your Company has an effective Vigil Mechanism system which is embeddedin its Code of Conduct to report to the management instances of unethical behaviouractual or suspected fraud or violation of the Company's code of conduct or ethics policy.The Code of Conduct of your Company serves as a guide for daily business interactionsreflecting your Company's standard for appropriate behavior and living Corporate Values.The Vigil Mechanism provides a mechanism for employees of the Company to approach theChairman of the Audit Committee of the Company.
FORMAL EVALUATION OF BOARD COMMITTEES & DIRECTORS' PERFORMANCE
Pursuant to the provisions of the Companies Act 2013 and the SEBI(Listing Obligations and Disclosure Requirements) Regulations 2015 the Board has throughmutual discussions carried out an annual evaluation of its own performance the directorsindividually as well as the evaluation of the working of its Committees.
The Nomination and Remuneration Committee ("NRC") evaluatedthe performance of the individual directors on the basis of the criteria such as thecontribution of the individual director to the Board and committee meetings likepreparedness on the issues to be discussed meaningful and constructive contribution andinputs in meetings etc.
In a separate meeting of independent Directors performance ofnon-independent directors performance of the board as a whole and performance of theChairman was reviewed taking into account the views of executive directors andnon-executive directors of the company.
CONSERVATION OF ENERGY TECHNOLOGLY ABSORPTION FOREIGN EXCHANGEEARNINGS AND OUTGO
Information in accordance with the provisions of Section 134 (3) (m) ofthe Companies Act 2013 read with Rule 8 of Companies (Accounts) Rules 2014 regardingconservation of energy technology absorption and foreign exchange earnings and outgo forthe year ended 31st March 2019 is annexed to this report as Annexure III andforms part of this report.
In terms of provision of regulation 15(2) of SEBI (Listing Obligationsand Disclosure Requirements) Regulations 2015 compliance with the Corporate Governanceprovisions as specified under regulations 17 18 19 20 21 22 23 24 25 26 27 andclause (b) to (i) of sub-regulation (2) of regulation 46 and para C D and E of Schedule Vis not applicable to the Company as paid-up share capital of the Company is less than Rs.10 crore and net-worth of the Company is less than Rs. 25 crore as on the financial yearended on 31st March 2019. However in view of provision of regulation 15(3) ofSEBI (Listing Obligations and Disclosure Requirements) Regulation 2015 the Company hasmade compliances with the applicable provisions under the Companies Act 2013.
MANAGEMENT DISCUSSION AND ANALYSIS
In terms of regulation 34(2)(e) and para B of Schedule V of the SEBI(Listing Obligations and Disclosure Requirements) Regulation 2015 Management Discussion& Analysis Report is annexed to this report as Annexure IV and forms part ofthis Annual Report.
PARTICULARS OF EMPLOYEES
The information required under Rule 5 (2) and (3) of The Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 is not required asthere was no employee on the payroll of the Company receiving remuneration in excess oflimit prescribed under the said rules.
NOMINATION & REMUNERATION POLICY
The broad terms of reference of the Nomination and RemunerationCommittee ("NRC") of the Company are as under :
a) To identify suitable persons interview them if necessary andrecommend them as suitable candidates to fill up vacancies on the Board or augment theBoard and Senior Management.
b) To develop a policy to ensure the optimum composition of the Boardof Directors ensuring a mix of knowledge experience and expertise from diversified fieldsof knowledge i.e. Policy on Board Diversity. The Policy also intends to addprofessionalism and objectivity in the process of deciding Board membership.
c) To lay down criteria for the evaluation of the Board.
d) To formulate a criteria for determining qualifications positiveattributes and independence of a Director and recommend to the Board a Policy thereon.
e) To formulate criteria for evaluation of Directors.
The company has adopted a Nomination and Remuneration Policy asrecommended by "NRC" and the objective of Nomination and Remuneration Policy isto ensure rationale and objectivity in the remuneration of the Directors SeniorManagement & employees of the Company. The Policy also intends to bring in a pragmaticmethodology in screening of candidates who may be recommended to the position of Directorsand to establish effective evaluation criteria to evaluate the performance of everyDirector and the overall Board of the Company.
The Policy also serves as a guiding principle to ensure good CorporateGovernance as well as to provide sustainability to the Board of Directors of the Company
DISCLOSURE OF RATIO OF REMUNERATION OF DIRECTOR'S & KEY MANAGERIALPERSONNEL ETC.
In terms of provision of Section 197(12) of the Companies Act 2013read with Rule 5(1) of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014 the details of the ratio of the remuneration of each director tothe median employee's remuneration and such other details as prescribed therein is annexedto this report as Annexure V and forms part of this Annual Report.
During the financial year 2018-19 the company did not pay anyremuneration to the Managing Director and other directors of the company.
CORPORATE SOCIAL RESPONSIBILITIES
The provision of section 135 of the Companies Act 2013 is notapplicable on the Company as your Company did not meet any of the applicability criteriaas specified under Companies (Corporate Social Responsibility Policy) Rules 2014.
DISCLOSURE UNDER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTIONPROHIBITION & REDRESSAL) ACT 2013
In accordance with the provision of The Sexual Harassment of Women atWorkplace (Prevention Prohibition and Redressal) Act 2013 the Company has adopted apolicy for prevention of Sexual Harassment of Women at workplace and has set up Committeefor implementation of said policy. Hence the company has complied with provisionsrelating to the constitution of Internal Complaints Committee under the Sexual Harassmentof Women at Workplace (Prevention Prohibition and Redressal) Act 2013. During the yearCompany has not received any complaint of harassment.
As a responsible corporate citizen the Company welcomes and supportsthe 'Green Initiative' taken by the Ministry of Corporate Affairs Government of India(MCA) by its recent Circulars enabling electronic delivery of documents including theAnnual Report to shareholders at their e-mail address registered with the DepositoryParticipants(DPs)/Company/Registrars & Share Transfer Agents.
Shareholders who have not registered their e-mail addresses so far arerequested to register their email addresses. Those holding shares in DEMAT form canregister their e-mail address with their concerned DPs. Shareholders who hold shares inphysical form are requested to register their e-mail addresses with Skyline FinancialServices Pvt. Ltd. by sending a letter duly signed by the first/sole holder quotingdetails of Folio Number.
INTERNAL FINANCIAL CONTROLS
Based on the framework of internal financial controls and compliancesystems established and maintained by the Company work performed by the internalstatutory cost auditors secretarial auditors and external consultants and the reviewsperformed by Management and the relevant Board Committees including the Audit Committeethe Board is of the opinion that the Company's internal financial controls were adequateand effective during the financial year 2018-19.
Your Company has complied with the applicable Secretarial Standardsissued by the Institute of Companies Secretaries of India during the year.
DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to Section 134(3)(c) of the Companies Act 2013 yourDirectors in respect of the Audited Annual Accounts for the year ended 31stMarch 2019 to the best of their knowledge and ability hereby state that :
(i) In the preparation of the annual accounts the applicableaccounting standards have been followed along with proper explanation relating to materialdepartures;
(ii) 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 ended on March 31 2019 and of the profit of the Company for the year endedon that date;
(iii) They have taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with the provisions of Companies Act 2013 forsafeguarding the assets of the Company and for preventing and detecting fraud and otherirregularities;
(iv) They have prepared the annual accounts on a going concern basis.
(v) They have laid down internal financial controls to be followed bythe company and that such internal financial controls are adequate and were operatingeffectively.
(vi) They have devised proper systems to ensure compliance with theprovisions of all applicable laws and that such systems were adequate and operatingeffectively.
APPRECIATION & ACKNOWLEGEMENT
Your Directors take this opportunity to express their appreciation forthe co-operation and assistance received from the Central Government the StateGovernment the Financial Institutions Banks as well as the Shareholders during the yearunder review. Your Directors also with the place on record their appreciation of thedevoted and dedicated service rendered by all the employees of your Company.