Your Directors have pleasure in presenting the Seventy Fifth Annual Report with theAudited Accounts for the year ended March 31 2018.
The performance of the Company for the financial year ended March 31 2018 issummarized below:
| || |
Amount Rs. Lakhs
|Particulars ||2017 - 2018 ||2016 - 2017 |
|Revenue from Operations ||2970.80 ||2911.98 |
|Other Income ||422.32 ||489.61 |
|Total Income ||3393.12 ||3401.59 |
|Profit before tax for the year ||360.08 ||301.78 |
|Less: Provision for Taxation || || |
|(i) Current Tax (including MAT credit utilisation) ||73.96 ||12.77 |
|(ii) Deferred Tax ||6.43 ||16.72 |
|Profit/(Loss) for the period ||279.69 ||272.29 |
|Other Comprehensive Income taken to retained earnings ||(115.85) ||(19.90) |
|Add: Retained earnings of previous year ||600.62 ||348.23 |
|Total Retained earnings before appropriations ||764.46 ||600.62 |
|Transfer to General Reserve || ||Nil |
|Dividend on Equity Shares -2016-2017 ||125.47 || |
|Tax on Final Dividend-2016-2017 ||25.55 || |
|Retained earnings carried to Balance Sheet ||613.44 ||600.62 |
|Total ||764.46 ||600.62 |
|Proposed Dividend for the current year * || || |
|Tax on proposed Dividend for the current year * || || |
* Proposed dividend on equity shares and tax on dividend have not been recognised as aliability in the current year's accounts in accordance with the Indian Accounting Standard10 Events after the reporting period.
Total income dropped from Rs. 3402 Lakhs in 2016-2017 to Rs. 3393 Lakhs in 2017-2018.Profit after comprehensive income/expenses/Tax was Rs. 137.57 Lakhs (previous year: Rs.256.65 Lakhs).
Tea production during the year was 11.35 lacsKgs with an average yield of 2126 kgs. perhectare as against 8.21 lacsKgs with an average yield 1539 kgs. per hectare during lastyear. Apart from this there is also a production of 11.77 Lacskgs of bought leaf asagainst 11.41 LacsKgs during the previous year. The sale average during the year was atRs. 127.40 per Kg as against the last year's sale average of Rs. 133.46/- per Kg.
Your Directors are pleased to recommend a dividend of 200% (Rs. 20 per share) on EquityShare Capital for the year ended 31.03.2018 amounting to Rs. 125.47 Lakhs excludingdividend tax.
LISTING OF SECURITIES ON BSE LTD
The equity shares of the company continued to be listed on BSE Ltd. The Company haspaid listing fees upto March 31 2019 to the BSE Limited (BSE).
The Board of Directors consists of Mr. Ajit Thomas Chairman Mrs. Shanthi ThomasExecutive Director Mr. A.D.Bopana & Mr. F.S.Mohan Eddy Independent Directors andMr. W.D.Nelson Director (upto 29.08.2017).
The Board of Directors met five times during this financial year. The details of theBoard meetings are given in Corporate Governance report. The intervening gap between themeetings was within the period prescribed under the Companies Act 2013 and SEBI (ListingObligations andDisclosure Requirements) Regulations 2015.
AUDIT COMMITTEE MEETINGS
The constitution of Audit committee during the year was as follows:-
Mr.A.D.Bopana (Independent Director and Chairman of Audit Committee)
Mr. Ajit Thomas(Director )(w.e.f. 10.08.2017)
Mr. F.S.Mohan Eddy (Independent Director)
The terms of reference stipulated by the Board to the Audit Committee cover the mattersspecified for Audit Committee underSEBI (Listing Obligations and Disclosure Requirements)Regulations 2015.
The Committee met four times during this financial year. The details of the Committeemeetings are given in Corporate Governance report. The intervening gap between themeetings was within the period prescribed under the Companies Act 2013 and SEBI (ListingObligations andDisclosure Requirements) Regulations 2015.
VIGIL MECHANISM / WHISTLE BLOWER POLICY
The Company has a Vigil Mechanism / Whistle Blower Policy in place pursuant to Section177 (9) of the Companies Act 2013 and as per Regulation 22 of SEBI (Listing Obligationsand Disclosure Requirements) Regulations 2015. The said policy is available in thewebsite of the company.During the year no instances of unethical behaviour were reported.
NOMINATION & REMUNERATION COMMITTEE
The constitution of the Nomination & Remuneration Committee are given as follows:-
|Mr. A.D.Bopana ||- ||Independent Director |
|Mr. Ajit Thomas ||- ||Director (w.e.f 10.08.2017) |
|Mr. F.S.Mohan Eddy ||- ||Independent Director |
NOMINATION & REMUNERATION POLICY
The Board has on the recommendation of the Nomination & Remuneration Committeeframed a policy for selection and appointment of Directors Senior Management KeyManagerial Personnel and their remuneration.
PARTICULARS OF LOANS GUARANTEE OR INVESTMENTS
The Company has not given any loans or guarantees covered under the provisions ofSection 186 of the Companies Act 2013 and Schedule V of the SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015.
The details of investments made by Company is given in the notes nos. 6 & 13 to thefinancial statements.
The Company is not accepting deposits and all deposits accepted earlier have beenrepaid. As such there are no unclaimed deposits in the books of the company as on March31 2018.
TRANSFER OF SHARES TO INVESTOR EDUCATION AND PROTECTION FUND (IEPF) AUTHORITY
Pursuant to Section 124 and 125 of the Companies Act 2013 read with the InvestorEducation and Protection Fund Authority (Accounting Audit Transfer and Refund) Rules2016 ("IEPF Rules") dividends if not claimed for consecutive period of 7 yearsfrom the date of transfer to unpaid Dividend Account of the Company are liable to betransferred to the Investor Education and Protection Fund ("IEPF") Furthershares in respect of such dividends which have not been claimed for a period of 7consecutive years are also liable to be transferred to the demat account of the IEPFAuthority. The said requirement does not apply to shares in respect of which there is aspecific order of Court Tribunal or Statutory Authority restraining any transfer of theshares. The provisions relating to transfer of shares were made effective by the Ministryof Corporate Affairs vide its Notification dated October 13 2017 read with the circulardated October 16 2017 wherein it was provided that where the period of 7 consecutiveyears as above was completed or being completed during the period from September 7 2016to October 31 2017 the due date of transfer for such shares was October 31 2017.
In the interest of the shareholders the Company has sent reminders to the shareholdersto claim their dividends in order to avoid transfer of dividends / shares to IEPFAuthority. Notices in this regard also published in the newspapers and the details ofunclaimed dividends and shareholders whose shares liable to be transferred to IEPFAuthority were uploaded on the Company's web site (www.neelamalaiagro.com) In the light ofthe aforesaid provisions the Company had during the year transferred to the IEPF theunclaimed dividends outstanding for 7 consecutive years. Further the 29204 shares ( No.of shareholders- 243) of the Company in respect of which dividend has not been claimedfor 7 consecutive years or more have also been transferred to the demat account of theIEPF Authority.
The members who have a claim on above dividends and shares may claim the same from IEPFAuthority by submitting an online application in the prescribed Form No. IEPF -5 availableon the website www.iepf.gov.in and sending a physical copy of the same duly signed to theCompany along with requisite documents enumerated in the Form No. IEFP-5. No claim shalllie against the Company in respect of the dividend / shares so transferred.
The Company has not transferred any amount to the reserves for the financial year2017-2018.
MATERIAL CHANGES AND COMMITMENTS IF ANY AFFECTING THE FINANCIAL POSITION OF THECOMPANY
There were no material changes and commitments affecting the financial position of theCompany between the end of the financial year of the Company and the date of the reportother than those disclosed in the financial statements.
DIRECTORS AND KEY MANAGERIAL PERSONNEL
1. Executive Director
Mrs. Shanthi Thomas has been re-appointed as the Executive Director of the Company inthe Board Meeting held on February 05 2018 on the recommendation of the Nomination andRemuneration Committee for a further period of 3 years w.e.f.February 05 2018 subjectto the approval of shareholders..The provisions of the Companies Act 2013 pertaining toappointment of Woman Director under Section 149(1) have been complied with.
2. Independent Directors
Mr. A.D.Bopana& Mr. F.S.Mohan Eddy are the Independent Directors of the company.
3. Non-Executive Director
Mr. W.D.NelsonDirector has resigned from the Board of Directors with effect from theclose of business hours on August 29 2017 due to personal reasons. Your Directors placeon record their appreciation for the valuable services rendered by Mr. W.D.Nelson duringhis tenure as Director of the company.
4. Director retiring by rotation
In accordance with the provisions of Companies Act 2013 and the Articles ofAssociation of the Company Mr. Ajit Thomas Chairman retires by rotation at the 75thAnnual General Meeting and being eligible offer himself for re-appointment.
5. Key Managerial Personnel
Mrs. Shanthi Thomas Executive Director and Mr. T.M.Harikumar Company Secretary &Chief Financial Officer are the Key Managerial Personnel of the Company.
6. Declaration from Independent Directors on Annual Basis The Company has receivednecessary declaration from all the Independent Directors of the Company under Section149(7) of the Companies Act 2013 that the Independent Directors of the Company meet withthe criteria of their Independence laid down in Section 149(6) of the Companies Act 2013.
INFORMATION ABOUT THE FINANCIAL PERFORMANCE/FINANCIAL POSITION OF THESUBSIDIARIES/ASSOCIATES/JOINT VENTURE
The company has no subsidiary companies.
As required under Section 129(3) of the Companies Act 2013 the Company has prepared aConsolidated Financial Statement in respect of its Associates/Joint Venture companiesalongwith its own financial statements. Further details of financialperformance/financial position of the associate companies as required under first provisoto Section 129(3) of the Companies Act 2013 read with Rule 5 of Companies (Accounts)Rules 2014 are annexed in Form AOC 1 (Annexure 1).
CONSERVATION OF ENERGY
The company has taken adequate steps for conservation of energy by utilizing alternatesources and by investing on energy conservation equipments. The particulars prescribed bythe Section 134 (3) (m) of the Companies Act 2013 read with Rule 8 of the Companies(Accounts) Rules 2014 relating to Conservation of Energy and Technology Absorption arefurnished in the Annexure 2 to this Report.
FOREIGN EXCHANGE EARNINGS AND OUTGO
During the year under review the Company's Foreign Exchange Earnings amounted to Rs.1703.82 Lakhs. The total outgo on Foreign Exchange amounted to Rs.12.16Lakhs.The Companyhas continued to maintain focus and avail of export opportunities based on economicconsiderations.
The information required under section 197 (12) of the Companies Act 2013 read withrule 5 (1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules2014 in respect of the Company have been given in the Annexure 3.
The information under section 197 of Companies Act 2013 and pursuant to Rule 5 (2) ofthe Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 are notrequired as none of the employees falls under this category. The statement containingremuneration paid to employees and other details as required under Section 197 (12) of theCompanies Act 2013 read with Rule 5 (2) of the Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014 is provided in a separate annexure forming part of thisreport. Further the report and the accounts are being sent to the members excluding theaforesaid annexure. In terms of Section 136 of the Act the said annexure is open forinspection at the Registered Office of the Company during business hours on working daysof the Company upto date of the forthcoming Annual General Meeting. Any member interestedin obtaining a copy of the same may write to the Company and the same will be providedfree of cost to the member.
Pursuant to Section 139 and 142 of the Companies Act 2013 the members of the Companyhad appointed M/s. PKF Sridhar &Santhanam LLP CharteredAccountants KRD Gee GeeCrystal 7th Floor 91-92 Dr. Radha krishanan Salai Mylapore Chennai - 600004 (Firm'sRegistration No. 003990S / S200018) as Statutory Auditors for a period of 5 yearscommencing from the conclusion of the 74th Annual General Meeting till the conclusion ofthe 79th Annual General Meeting. In view of the amendment to the Companies Act 2013notified by the Ministry of Corporate Affairs dated May 07 2018 their appointment neednot required to be ratified by the Members.
There are no qualifications or adverse remarks mentioned in the Auditors' report. Thenotes to accounts forming part of financial statements are self-explanatory and needs nofurther clarification.
Pursuant to the provisions of Section 204 of the Companies Act 2013 and the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 the Company hasappointed Mr. V. Suresh Practising Company Secretary ( C.P.No. 6032) Chennai toundertake the Secretarial Audit of the Company. The Secretarial Audit Report in Form MR-3is annexed (Annexure 4) to this report and forms an integral part of this Report.
There is no secretarial audit qualification reservation or adverse remarks in theSecretarial Report for the period under review.
The relevant Secretarial Standards issued by the Institute of Company Secretaries ofIndia (ICSI) relating to theBoard and General Meetings have been complied with by theCompany.
The provisions of Cost Audit under Section 148 of the Companies Act 2013 are notapplicable to the Company
The Company has in place adequate Internal Audit and Internal Financial Controls withreference to the financialstatements which is evaluated by the Audit Committee as perPart C of Schedule II of the SEBI (Listing Obligationsand Disclosure Requirements)Regulations 2015. In compliance with Section 138 of the Companies Act 2013 the Companyhad engaged M/s. PSDY& Associates Chartered Accountants Ernakulam as the InternalAuditors of the Company for the financial year 2017-2018. Findings and observations of theInternalAuditors are discussed and suitable corrective actions aretaken as per thedirections of the Audit Committee onan on-going basis to improve efficiency inoperations.Thus the internal audit function essentially validates thecompliance of theCompany.The Company's internal control systems are well establishedand commensurate withthe nature of its business and thesize and complexities of operations and adequate withreference to the financial statements as envisaged under the Companies Act 2013.Yourdirectors endorse that during the year under reviewthere were no reportable materialweaknesses in the present systems or operations of internal controls.
The Company has taken adequate steps to adhere to all the stipulations laid down inRegulation 27 read with Part E of Schedule II and Schedule V of SEBI (Listing Obligationsand Disclosure Requirements) Regulations 2015 on Corporate Governance. The ManagementDiscussion & Analysis Report and Report on Corporate Governance with Certificate oncompliance with conditions of Corporate Governance have been annexed to this report (Annexures 5 & 6).
The Company continues to carry adequate insurance coverage for all assets.
RELATED PARTY TRANSACTIONS
All related party transactions that were entered into during the financial year were onan arm's length basis and were in the ordinary course of business and that the provisionsof Section 188 of the Companies Act 2013 are not attracted. Details of the transactionsare provided in Form AOC 2 which is attached as Annexure 7to this report.
All Related Party Transactions were placed before the AuditCommittee as also the Boardfor approval. Prior omnibus approval of the Audit Committee was obtained forthetransactions which are foreseen and repetitive in nature. The Company has put in placeproper system for identification and monitoring of such transactions. The policy onRelated Party Transactions as approved by the Board is uploaded on the Company's websitewww.neelamalaiagro.com
SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS
There were no significant material orders passed by the Regulators/ Courts which wouldimpact the going concern status of the Company and its future operations.
EXTRACT OF ANNUAL RETURN
The details forming part of the extract of the Annual Return in form MGT 9 is annexed(Annexure8)
During the year under review your company enjoyed cordial relationship with workersand employees at all levels.
CORPORATE SOCIAL RESPONSIBILITY
The company does not fall within the ambit of the provisions of Section 135 of theCompanies Act 2013 regarding Corporate Social Responsibility and hence Annual Report onCorporate Social Responsibility (CSR) Activities is not annexed.
STAKEHOLDERS' RELATIONSHIP COMMITTEE
The Board has constituted a Stakeholders Relationship Committee comprising of Mr. AjitThomas as Chairperson and Mr. A.D.Bopana as Member of the Committee. The Board hasdesignated Mr. T.M.Hari Kumar Company Secretary & CFO of the Company as theCompliance Officer.
RISK MANAGEMENT PLAN
Pursuant to Section 134 (3) (n) of the Companies Act 2013 and as per Regulation 17(9)(a) of Securities and Exchange Board of India (Listing Obligations and DisclosureRequirements) Regulations 2015 the Company had laid down the procedures to inform Boardmembers about the risk assessment and mitigation procedures.
Regarding the general risk the company follows a minimal risk business strategy asgiven below:-
|Particulars ||Risk Minimizing steps |
|Fixed Assets and Current Assets ||The company has taken adequate in- surance coverage of its fixed assets and current assets which will mini- mize the impact of another event or development |
|Financial Risk ||The company has a conservative debt policy. The debt component is very marginal |
|Foreign Exchange Risk ||Whenever there is an export the Foreign Exchange is covered at the time of confirmation of order so as to negate any fluctuation in the ex- change rate |
|Credit risk on exports ||The credit is insured through Export Credit and Guarantee Corporation Limited (ECGC) |
Mr. T.M.Harikumar Company Secretary & CFO has been assigned the task of informingthe Board about the various risks and its mitigation by the Company from time to time. Atpresent the company has not identified any element of risk which may threaten theexistence of the Company.
As per provisions of the Companies Act 2013 and SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 the evaluation process for the performance ofthe Board its Committees and individual Directors were carried out internally. Each Boardmember completed a questionnaire providing feedback on the functioning and overall levelof engagement of the Board and its committees on the parameters such as the compositionexecution of specific duties contribution of new ideas/insights quality quantity andtimeliness of flow of information deliberations at the meeting independent approach indecision making etc.
The Independent Directors in their meeting held on February 05 2018 reviewed theperformance of the Board as a whole and noted that the Board has been meeting regularly asper requirements of the Companies Act 2013 and has been fulfilling all functions anddischarging the various requirements. The Board has also been ensuring compliance of theprovisions of all laws and rules and regulations framed thereunder as applicable to thecompany. The Independent Directors also reviewed and were satisfied with the performanceof the Non- Independent Director. The performance of the Chairperson of the companytaking into account the views of Executive Director and Non-Executive Director was alsoreviewed by the Independent Directors and they were satisfied with the performance of theChairperson under whose leadership and guidance the company has made great progress overthe years.
DISCLOSURE OF ACCOUNTING TREATMENT
The Company has adopted the Indian AccountingStandards (Ind AS) with effect from 1stApril 2017 andall its financial statements are made according to the saidstandard.Further in the preparation of the financialstatements the Company has followed theAccountingStandards referred to in Section 133 of the Companies Act2013. The significantaccounting policies which are appliedare set out in the Notes to the Financial Statements.
DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORK PLACE (PREVENTION PROHIBITIONAND REDRESSAL) ACT 2013
The Company has in place an Anti Sexual Harassment Policy in line with the requirementsof the Act and that an Internal Complaints Committee has been set up for redressal ofcomplaints and that all employees (permanent contractual temporary trainees) arecovered under this policy.
During the year the company has not received any compliant under Sexual Harassment ofWomen at the Workplace (Prevention Prohibition &Redressal) Act 2013.
Goods and Service Tax (GST) is an indirect tax which has replaced many indirect taxesin India. GST is levied on the supply of goods and services and will mainly remove thecascading effect on the sale. Removal of cascading effect will directly impact the cost ofgoods. The Company hasimplemented the same with effect from July 01 2017 in accordancewith the implementation of the new taxation regime.
DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to the requirement under Section 134 (3) ( c) of the Companies Act 2013 withrespect to Directors' Responsibility Statement it is hereby confirmed that:
1. In the preparation of the accounts for the financial year ended 31st March 2018 theapplicable accounting standards had been followed along with proper explanation relatingto material departures;
2. 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 at the end of the financial year and ofthe profit of the Company for that period;
3. The Directors had taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of this Act for safeguarding theassets of the Company and for preventing and detecting fraud and other irregularities;
4. The Directors have prepared the accounts for the financial year ended 31st March2018 on a going concern' basis.
5. The directors had laid down internal financial controls to be followed by thecompany and that such internal financial controls are adequate and were operatingeffectively.
6. The directors had devised proper system to ensure compliance with the provisions ofall applicable laws and that such systems were adequate and operating effectively.
INTERNAL CONTROL SYSTEMS
The company has a proper and adequate system of internal controls to ensure that allassets are safeguarded and protected against loss from unauthorised use or dispositionand those transactions are authorised recorded and reported correctly. The Company has anextensive system of internal controls which ensures optimal utilization and protection ofresources IT security accurate reporting of financial transactions and compliance withapplicable laws and regulations as also internal policies and procedures. The internalcontrol system is supplemented by extensive internal audits regular reviews bymanagement and well documented policies and guidelines to ensure reliability of financialand all other records to prepare financial statements and other data.
The Directors sincerely acknowledge the contribution and support from customersshareholders Central and State Governments Bankers Securities Exchange Board of IndiaBSE Ltd Cameo Corporate Services Ltd. Central Depository Services Ltd. Registrar ofCompanies Tamil Nadu and other Government Authorities for the cooperation andassistance provided to the Company.
The Directors also place on record their gratitude to the employees for their continuedsupport commitment dedication and co-operation.
| ||On Behalf of the Board |
| ||Ajit Thomas |
|Chennai ||Chairman |
|29.05.2018 ||DIN : 00018691 |