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Noble Explochem Ltd.

BSE: 506991 Sector: Industrials
NSE: N.A. ISIN Code: INE875D01011
BSE 00:00 | 04 Mar Noble Explochem Ltd
NSE 05:30 | 01 Jan Noble Explochem Ltd
OPEN 5.00
PREVIOUS CLOSE 4.96
VOLUME 9684
52-Week high 5.25
52-Week low 0.00
P/E
Mkt Cap.(Rs cr) 10
Buy Price 4.93
Buy Qty 485.00
Sell Price 0.00
Sell Qty 0.00
OPEN 5.00
CLOSE 4.96
VOLUME 9684
52-Week high 5.25
52-Week low 0.00
P/E
Mkt Cap.(Rs cr) 10
Buy Price 4.93
Buy Qty 485.00
Sell Price 0.00
Sell Qty 0.00

Noble Explochem Ltd. (NOBLEEXPLOCHEM) - Director Report

Company director report

To

The Members

The Resolution Professional present herewith the Thirty Seventh Annual Report togetherwith the Statement of Accounts for the year ended 31st March 2019

Financial Results:

(Rs. in lakhs)

Particulars 2018 2019 2017 2018
Income:
Other Income 21.70 3.67
Less: Expenses 119.93 58.36
Gross Profit/(Loss) before depreciation/ Interest and Tax (98.22) (54.69)
Less : Interest and Finance Charges 0 0
Profit/ (loss) before Tax (98.22) (54.69)
Add/Less: prior period adjustment 0 0
Less : Extra Ordinary Items 0 0
Less: Provision for Income tax /Def. Tax release 0 0
Net Profit/(Loss) for the year (98.22) (54.69)

Dividend

In view of incurring of losses no dividend is proposed for the year under report.

Transfer to General Reserves:

The Company's production is held up this financial year also. There was no turnoverhence company is incurring losses. Therefore it is not proposed to transfer any amount toGeneral Reserves.

Material Changes during the period of Financial Statements and Board's Report Date:

The Company is under the Insolvency Resolution Process ordered by National Company LawTribunal (NCLT). Initially Shri Manoj Sehgal Chartered Accountant from Gurugram wasappointed as Resolution Professional. But in the month of March 2019 the NCLT on thereference of Financial Creditors changed the Resolution Professional and at present Ms.Prajakta Menezes Mumbai is having the charge of Resolution Process and the InsolvencyResolution process is at final stage.

Directors

The Company is under the Corporate Insolvency Resolution Process through ResolutionProfessional Ms. Prajakta Menenzes. Therefore as per the provisions of IBC the power ofthe Board of Directors has been suspended

The RP has appointed Ms. Vinda Warhadpande as CEO for the purpose of day to day andadministrative as well as compliance under various provisions of the laws.

Declaration from directors and Independent Directors:

The Company has not received any declarations from Directors or independent Directorsas the Boards powers has been suspended for the Insolvency Resolution process.

Board Meetings:

During the year under review the Board meets one time the details of which are givenin the Corporate Governance Report which forms part of this report.

Policy on Appointment and Remuneration to Directors

The current policy of the Company on appointment and remuneration of Directors is tohave an appropriate mix of Executives non-executives and Independent Directors on theBoard of the Company. As on 31st March 2018 the Company has 6 Directors on theBoard of Directors of which 3 are executive Directors and three are IndependentDirectors. More details are given in the Corporate Governance Report which is part of thisReport.

Directors' Responsibility Statement

Pursuant to the provisions of Section 134 (5) of the Companies Act 2013 the Boardconfirm and submit-

(i) That in the preparation of the annual accounts the applicable accounting standardshad been followed along with proper explanation relating to material departures;

(ii) That the Directors had 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 and of the loss of the Company for that period;

(iii) That the Directors had taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with the provisions of this Act for safeguardingthe assets of the Company and for preventing and detecting fraud and other irregularities;

(iv) That the Directors had prepared the annual accounts on a going concern basis.

(v) That being the listed Company the directors had laid down the internal financialcontrols to be followed by the Company and that such Internal Financial Controls areadequate and were operating efficiently.

(vi) That the Directors had devised proper systems to ensure compliance with theprovisions of all applicable laws and that such systems were adequate and operatingefficiently. (Above Directors responsibility statement given as a standard compliancebut powers of the Board are suspended for the purpose of Insolvency Resolution Process.)

Listing:

The Equity Shares of the Company are listed on the Bombay Stock Exchange Limited (BSE).The trading of the Shares has been suspended by the BSE due to non-compliance of certainprovisions of SEBI (LODR) Regulations 2015. Company and the management are under theprocess to complete the formalities of compliances and regularise the trading again.

Corporate Governance

Pursuant to Rule 27 of the SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 Reports on Management Discussion & Analysis and on CorporateGovernance along with a certificate from the Auditors and CEO / CFO are attached heretoand form part of this report.

Share Capital:

There was no change in the authorised share capital or Paid Up Share Capital of thecompany during the year under review.

The Company has not announced any scheme of following issues

1. Employees Stock Option Scheme

2. Issue of Bonus Shares

3. Issue of Rights Shares

4. Issue of Securities by Private Placement

5. Issue of any other securities

Auditor's Report

The Auditor's Report is self-explanatory except the following qualifications mentionedin the report:

a) As explained in Note No. 20 of Notes to Accounts the expenses aggregating Rs. 4.61lacs for the Year 2018-19 have not been provided due to which current year loss is underslated by Rs 4.61 lacs.

b) Calls in arrears are unreconciled to the extent of Rs 2.25 lacs.

c) No provision has been made for loans and advances amounting to Rs. 110.51 lacswhich are prima facie doubtful of recovery and in our opinion current year's loss andaccumulated losses of the company are under stated by provision of such doubtful advances.

d) Depreciation on tangible and intangible assets (as per Schedule 11 of Companies Act2013) has not been provided due to discontinuing operation of the company since December2006 as the relevant assets are not in use.

e) Deferred Tax Assets (Net) as per IND AS - 12 (previously as per Accounting Standard22 regarding "Accounting for Taxes on Income) has not been recognized in view ofconsistent losses in the past and of uncertainty regarding estimation of future profitwith reasonable certainty.

f) As explained in Note No 21 the liability on account of non-fulfillment of exportobligation has not been considered since the same has remained ascertained andunaccounted for.

g) The Company is not regular in depositing statutory dues with appropriate authoritiesand substantial amount of statutory dues has become overdue and remain unpaid. Totalstatutory dues outstanding are Rs. 96.86 Lacs.

h) As explained company's production activity is closed most of the provisions ofapplicable laws like Gratuity Act Labor laws Environment Lows Specific Industry relatedlaws etc. are not complied with.

i) Internal auditor for the financial year under review has not been appointed by thecompany as required under section 138 of the Companies Act 2013 and also the company hasnot appointed Key Managerial Person (KMP) in form of Company Secretary in whole time inemployment and Chief Financial Officer. However as explained to us by the' managementthat company production activity has been fully stopped from the year 2006-2007. There isno sale or purchase activity since then. Only Administrative activity is continued atRegistered Office of the company. The Present size of the working is limited only up toadministrative work and necessary staff is maintained by the Company.

j) Attention is also invited in respect of the share application money received of Rs.622.50 Lacs by the Company which is pending for allotment in terms of Section 73 readwith Companies (Acceptance of Deposits) Amendment Rules 2015.

k) In absence of documents/ details are not made available to us we are unable tocomment whether any sums require to be transfer to the Investor Education and ProtectionFund or not and period of delay thereon.

l) The balance of other current assets trade payables unsecured loans and othercurrent liabilities includes balance remaining outstanding for a substantial period. Thebalances are subject to confirmation and reconciliation. The reported financials mighthave consequential impact which remains unascertained.

m) As informed to us by the Board of Director Company has neither provided nor paidany interest on outstanding dues to MSME Creditors in the past years and current yearRefer Note No. 13 Trade payables - disclosure in accordance with section 22 of MicroSmall and Medium Enterprises Development Act 2006. n) Rental expense for the officepremises is not provided as per the rent agreement. There is shortage in booking of rentby Rs. 55352.

On these points the Board submit the following explanation:

a) Contingent liabilities amount increases by Rs. 4.61 Lacs for Mar 19 as compared toMar 18. It comprises of Rs. 4.05 Lacs of employee claims not accounted for in the books ofaccounts and Rs.0.55 Lacs for difference in rent as per the rent agreement which was understated in the books of accounts.

b) The Calls in arrears for Rs. 2.25 Lacs remains to be un-reconciled due to non-availability of requisite old data from Registrar and Share Transfer Agents. c) Noprovision has been made for loans and advances amounting to Rs. 110.51 lacs which areprima facie doubtful of recovery and in auditors' opinion current year's loss andaccumulated losses of the company are under stated.

d) Depreciation on tangible and intangible assets (as per Schedule 11 of Companies Act2013) has not been provided due to discontinuing operation of the company since December2006 as the relevant assets are not in use.

e) Deferred Tax Assets (Net) as per IND AS - 12 (previously as per Accounting Standard22 regarding "Accounting for Taxes on Income) has not been recognized in view ofconsistent losses in the past and of uncertainty regarding estimation of future profitwith reasonable certainty.

f) In respect of non-fulfillment of export obligation the Management 0f the Companyhad made an application to the Export Department for the extension of time of 5 yearsfrom the date of sanction of Rehabilitation Scheme by the BIFR for fulfillment of exportObligation promised.

g) Due to discontinued operations and cash flow crunches the Company is not regular indepositing statutory dues with appropriate authorities and statutory dues has becomeoverdue and remain unpaid.

h) As Company's production activity is closed most of the provisions of applicablelaws like Gratuity Act Labor laws Environment Lows Specific Industry related laws etc.are not complied with.

i) Internal auditor for the financial year under review has not been appointed by thecompany as required under section 138 of the Companies Act 2013 and also the company hasnot appointed Key Managerial Person (KMP) in form of Company Secretary in whole time inemployment and Chief Financial Officer. However as the company production activity hasbeen fully stopped from the year 2006-2007 and there are no sale or purchase activities.Presently only administrative activities are carried out and to that extent necessarystaff is maintained by the Company.

j) The Share Application Monies were received from the Strategic Investor and Promotersas per the scheme finalized and submitted by to the BIFR. As per the DRS the Promotersand Strategic Investors would have held certain number of shares and percentage holding inthe Company subject to the approval of scheme by the BIFR. Now that the BIFR repeal acthas been notified and the Company's matter before the BIFR stands abated.

Statutory Auditors:

M/s D P Sarda & Co. Chartered Accountants (FRN 117227W) Nagpur who wereappointed as Statutory Auditors of the Company in the 36rd Annual GeneralMeeting of the Company for five financial years. The RP has proposed for ratification ofappointment.

Secretarial Audit:

The RP has appointed M/s P. S. Channe & Associates Company Secretaries Nagpur asSecretarial Auditors to conduct the Secretarial Audit and Report thereon. Accordingly theCompany has received the said report and the said Report is being attached with thisDirectors' Report which is self-explanatory except the following qualifications mentionedin the report:

1. The Bombay Stock Exchange Limited (where the Company's Securities are listed) hadissued show cause notices to the Company for non-compliance of various clauses under SEBI(LODR) Regulations 2015. Further the BSE had suspended the trading of securities of theCompany for non-payment of Annual Listing Fees and other penalties for non-compliances ofcertain clauses. The BSE had also issued a Show Cause Notice for delisting of Securitiesfor non-compliances of certain provisions of SEBI LODR Rules. The present RP has maderepresentation before De-listing committee requesting not to de-list the Companyundergoing resolution process and has made bona fide payment of Annual Listing Fees forthe year 2019-20.

2. That the Company has not appointed KMP in form of Company Secretary in whole time inemployment and Chief Financial Officer.

3. That Company has not appointed Internal Auditor for the financial year under review.

4. That company has not received any declaration from directors in respect of interestor concern in other entities and disclosures regarding non-disqualification of Directorsare also not submitted by the Directors.

5. Certain forms [like MGT 14 and DPT 3 INC 22A etc.) as required under the variousapplicable provisions of the Companies act 2013 and rules made there under have not beenfiled by the Company.

6. During the financial year under audit one meeting of Board of Directors had beenheld on 30th May 2018 which was before the commencement of IRP process.Thereafter no board meeting committee meetings were held as whole charge and power ofboard is with Resolution Professional.

7. In absence of data required with respect to amount to be transfer to InvestorEducation and Protection Fund we are unable to comment on this matter.

8. That the Factory Licence under Factories Act has not been renewed and withheld bythe concerned Authorities.

9. That the Company has not renewed its licenses in respect of Explosives Chemicalsand Boilers.

10. That the pollution related Compliance is not complied with.

11. Since the Company's production activity is suspended most of the provisions ofapplicable Laws like Labour Laws

Environmental Laws Specific Industry related laws etc. are not complied with.

12. Various cases are pending in various courts against the Company the results ofwhich may affect adversely to the

Company.

13. Though there is no charge creation has been registered with the RoC. It is observedthat one of financial creditor has tried to file form for charge creation. Management ofthe company have some issues and filed case to oppose the registration process. 14.Secretarial Standard for meeting issued by ICSI New Delhi has not been followed.

15. The Share application money amounting approximately to Rs. 6.23 Cr. is shown in theBalance Sheet pending for allotment.

The management review/explanation to above observations is given below:

1. The Company had received notice from BSE in respect of non-payment of Annual ListingFees. The fees was paid late due to non-availability of funds in time. Due tonon-availability of funds the company could not pay the annual listing fees of BSE. TheRP represent before the Stock Exchange and made bonafide payment of listing fees toprevent company from De-listing.

2. The Company has not appointed Company Secretary in full time employment norappointed Chief Financial Officer because the Company is sick Company as declared by theHon'ble BIFR and the production activity is also stopped since the financial year 2006-07.The scope of financial transactions is very limited and small in size. The Company hasappointed one person as Manager to look after the financial transactions of the Company.Also the Company has made necessary arrangement to look after the secretarial compliancework on regular basis.

3. The Company's production activity has been fully stopped from the year 2006-07.There is no sale or purchase activity since then. Only administrative activity iscontinued at Registered Office of the Company. The present size of the working is limitedonly up to administrative work and necessary staff is maintained by the Company. Hence noInternal Auditor appointed. But the Company is having sufficient capacity and work forceto handle the work properly.

4. Since the Company is under the Insolvency Resolution process and the Hon'ble NCLThas appointed Ms. Prajakta Menezes. As a result the board power has been suspended. Hencethe Directors declarations was not taken on record.

5. Certain forms like INC 22A were not filed with the RoC as there are certainnon-compliances in respect of appointment of KMP. Other forms are not filed as there wasno any activity that requires to file the forms.

6. The company has been declared as sick and Insolvency Resolution process wascommenced from 14th May 2018 and Insolvency Resolution Professional wasappointed. Therefore all the powers of the Board has been suspended and vested into RP.Hence no meeting of Board or Committee was held during the year.

7. There is no funds as such that requires to be transferred to Investors Education andProtection Fund.

8. The Company's business activity has been held up since 2006. Therefore all therequirement under various acts have been not complied and licences required under variouslaws has not been renewed by the concerned government department due to non businessactivities.

9. The Share Application Monies were received from the Strategic Investor and Promotersas per the scheme finalised and submitted by the OA to the BIFR. As per the DRS thePromoters and Strategic Investors would have held certain number of shares and percentageholding in the Company subject to the approval of scheme by the BIFR. Now that the BIFRrepeal act has been notified and the Company's matter before the BIFR stands abated and afresh rehabilitation scheme has to be finalised the management is accordingly underdiscussions for allotment of shares subject to the necessary approvals. The amount ofShare application money was old balance pending for allotment on the order of BIFR. But asthe BIFR Act was repealed and the BIFR has been abated. Therefore the Company was insearch of prospective investor who could invest the funds in the company and it will bepossible to the Company to issue and allot shares.

10. The Company's production has been stopped since financial year 2006-07 andmanufacturing activity or related work is also discontinued. Hence there is no as suchcompliance relating to pollution control.

11. The Company has completed the procedure of renewal of Factory and other relatedlicenses. But the concerned department has not renewed the license stating there is noproduction activity and will be renewed as soon as the production activity will commence.

Corporate Social Responsibility

The provisions of Corporate Social Responsibility are not applicable to the Company.

Particulars of employees:

The Company does not have any employee whose particulars are required to be givenpursuant to the provisions of Section 197 of the Companies Act 2013 read with Rule 5(1)of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014.

Conservation of energy technology absorption and foreign exchange earnings &outgo:

As required under Section 134 (3) (m) of the Companies Act 2013 read with theCompanies (Accounts) Rules 2014 conservation of energy Technology absorption and foreignexchange earnings and outgo are nil as there were no operation during the year underreview. Only administrative office was working.

Details of Frauds as per Auditors Report:

There is no fraud in the Company during the Financial Year 2017-18. The Auditors reportalso clarified that no fraud was reported in the company during the year under review

Particulars of Transaction with Related Parties:

During the year under review there is no such transaction with related parties whichrequires the approval of members in general meeting or Board meetings of the Company

Prevention of Sexual Harassment

The Company has zero tolerance for sexual harassment at workplace and has adopted aPolicy on prevention prohibition and redressal of sexual harassment at workplace in linewith the provisions of the Sexual Harassment of Women at Workplace (PreventionProhibition and Redressal) Act 2013 and the Rules there under for prevention andredressal of complaints of sexual harassment at workplace. The Company is committed toproviding equal opportunities without regard to their race caste sex religion colournationality disability etc. All women associates (permanent temporary contractual andtrainees) as well as any women visiting the Company's office premises or women serviceproviders are covered under this Policy. All employees are treated with dignity with aview to maintain a work environment free of sexual harassment whether physical verbal orpsychological.

Material Changes and Commitments:

There have been no material changes or commitments that will affect the financialposition of the Company during the financial year under review.

Development and Implementation of Risk Management Policy:

The management has taken all necessary steps for the risk management development andimplementation.

Joint Venture Subsidiary or associate Companies:

The Company has no any subsidiary or associate Company or not entered in to any jointventure with other bodies corporate during the year under review.

Deposits:

The Company has not taken any deposits from any person/bodies corporate etc. during theyear under review. There are certain amount under the heading share application money overthe period of 60 days from receipt which is pending for allotment subject to the order ofBIFR/NCLT.

Orders passed by Courts/Regulators/tribunals:

The NCLT Mumbai bench passed the order under section 9 of IBC and InsolvencyResolution Professional was appointed. The process is on the final stage.

Acknowledgements:

The Board expresses its sincere gratitude to the shareholders bankers and clients fortheir continued support. The Board also wholeheartedly acknowledges the dedicated effortsof all the staff and employees of the Company.

Place: Nagpur By order of the Insolvency Resolution Professional
Date: 15th November 2019 Sd/-
Vinda M. Warhadpande
CEO for CIRP
DIN: 06973719

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