Your Directors are pleased to present the 73rd Annual Report of the Company alongwiththe Audited Financial Statements for the year ended 31st March 2020. The FinancialResults for the year are shown below:
(Rs in Lakhs)
|Particulars || |
| ||2019-20 ||2018-19 (Restated) ||2019-20 ||2018-19 |
|Total Income ||12579.59 ||2517.99 ||15273.29 ||4852.34 |
|Less: Total expenses ||5417.59 ||2266.19 ||5406.39 ||2253.66 |
|Less: Exceptional Items ||- ||- ||- ||- |
|Profit before tax ||7162.00 ||251.80 ||9866.90 ||2598.68 |
|Add/(Less): Tax expense ||1759.63 ||(740.82) ||1758.18 ||(740.79) |
|Profit after tax ||5402.37 ||992.62 ||8108.72 ||3339.47 |
|Add: Share in profit of associate company || || || || |
|Net profit after tax and share in profit of associate Company ||12092.16 ||200730.22 ||- ||- |
|Profit for the year ||17494.53 ||201722.84 ||8108.72 ||3339.47 |
|Add / (Less):Actuarial gain on defined benefit plan (gratuity) Net of Income Tax ||(134.17) ||36.31 ||(1.73) ||(0.77) |
|Realised gain on equity share ||125309.62 ||10625.86 ||125309.62 ||10625.86 |
|Less: Current tax on realised gain ||4200.15 ||2290.00 ||4200.15 ||2290.00 |
|Less: Adjustment related to Associates on account of their demerger ||- ||178391.52 ||- ||- |
|Add: Balance brought forward from previous year ||57875.98 ||31385.12 ||29061.04 ||22105.16 |
|Balance Available ||196345.81 ||63088.61 ||158277.50 ||33779.72 |
|Appropriations || || || || |
|Dividend paid ||1977.19 ||1977.19 ||1977.19 ||1977.19 |
|Additional tax on dividend paid ||976.51 ||900.37 ||406.42 ||406.42 |
|Transfer to Reserve u/s. 45- I C of Reserve Bank of India Act 1934 ||25915.00 ||2335.07 ||25915.00 ||2335.07 |
|Closing Balance of retained earnings ||167477.11 ||57875.98 ||129978.89 ||29061.04 |
INDIAN ACCOUNTING STANDARDS (IND AS)
The audited financial statements of the Company drawn up both on standalone andconsolidated basis for the financial year ended 31st March 2020 are in accordance withthe requirements of the Companies (Indian Accounting Standards) Rules 2015 ("Ind ASRules").
CHANGE IN THE NATURE OF BUSINESS IF ANY
During the year under review there has been no change in the nature of business of theCompany.
During the year under review there has been no change in the Share Capital of theCompany.
The Board of Directors has recommended a dividend of Rs 25/- (Rupees Twenty Fiveonly) per equity share of Rs 10/- each equivalent to 250 % ( Two hundred fiftypercent) on the paid up equity share capital of the Company for the year ended 31st March2020 as against Rs 25/- (Rupees twenty five only) per equity share equivalent to250% (two hundred fifty percent) paid in the previous year on the equity shares of Rs 10/-each. The dividend will be paid when approved by the shareholders in accordance with law.Pursuant to the Finance Act 2020 dividend income will be taxable in the hands of theShareholders w.e.f. 1st April 2020 and the Company is required to deduct tax at source("TDS") from dividend paid to the Members at prescribed rates as per the IncomeTax Act 1961. The total outflow will be of Rs 1977.19 Lakhs.
TRANSFER TO RESERVES
Your Directors do not propose to transfer any amount to the General Reserves for theFinancial Year ended 31st March 2020.
IMPACT OF COVID-19 PANDEMIC
COVID-19 Pandemic has caused unprecedented economic disruption globally and in India aswell. The Company is sensitive about the impact of the Pandemic not only on the humanlife but on businesses across the globe which will be realized only over next few months.The Company has been monitoring the situation closely and has taken proactive measures tocomply with various directions / regulations / guidelines issued by the Government andlocal bodies to ensure safety of its employees. The Company has made initial assessment ofthe likely adverse impact on economic environment in general and operational and financialrisks on account of COVID-19 which is discussed in detail in the Management Discussion andAnalysis Report attached elsewhere in this Annual Report. Vide notification dated 24thMarch 2020 issued by Ministry of Home Affairs a nation-wide lockdown was announced tocontain COVID-19 outbreak and the same has been progressively extended later. However theemployees of the Company have been asked to work from home and efforts have been made byyour Company to keep the operations of the Company since lockdown as smoothly as possiblewith least of the disruption. Moreover later with the ease of lockdown protocol in thestate the employees of the Company have resumed office complying with proper safetynorms and instructions as advised by the Authorities.
The extent to which the COVID-19 pandemic will impact the Company's results will dependon future developments which are highly uncertain including among other things theperformance of its investee companies.
Smt. Rajashree Birla (DIN: 00022995) will be retiring at the ensuing 73rd Annualgeneral Meeting of the Company and being eligible offers herself for being re-elected.
Smt. Rajashree Birla was appointed a Non-Executive Director on the Board of Directorsof the Company with effect from 27th August 2018. Securities and Exchange Board of India("SEBI") has amended the SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 vide circular dated 9th May 2018 which require for reappointment/continuance of any Non-Executive Director who has attained the age of 75 years to beapproved by the shareholders by way of a Special Resolution. Smt. Birla will be attainingthe age of 75 years on 14th September 2020. Hence the Board commends the resolution forapproval of the shareholders for the continuation of Smt. Birla as Non-Executive Directorof the Company liable to retire by rotation. The continuation of Smt. Birla as theNon-Executive Director will be of immense benefit for the company taking into account hervast and rich experience and deep business acumen. Proposal for the continuation of Smt.Birla as Non-Executive Director of the Company liable to retire by rotation is included inthe Notice convening the 73rd Annual General Meeting of the Company along with ExplanatoryStatement as required under Section 102 of the Companies Act 2013.
Shri D. K. Mantri (DIN: 00075664) ceased to be an Independent Director of the Companywith effect from 25th September 2019 due to his unwillingness expressed to the Board ofDirectors to be reappointed as an Independent Director for a second term of fiveconsecutive years. However the Board on the recommendations of the Nomination andRemuneration Committee of the Company have appointed him as an Additional Director in thecapacity of Non-Executive/Non-independent Director of the Company with effect from 14thNovember 2019. Shri Mantri holds office up to the date of the ensuing Annual GeneralMeeting of the Company. Proposal for appointment of Shri Mantri as a Director of theCompany is included in the Notice convening the 73rd Annual general Meeting of the Companyalong with the Explanatory Statement as required under Section 102 of the Companies Act2013. The Board considers his appointment as appropriate and in the best interest of theCompany and accordingly recommended his appointment as Non-Executive/Non-IndependentDirector liable to retire by rotation.
The Nomination and Remuneration Policy of the Company empowers the Nomination andRemuneration Committee to formulate a process for evaluating the performance of IndividualDirectors Committees of the Board and the Board as a whole.
The Nomination and Remuneration Committee of the Company accordingly evaluated theperformance of all the individual Directors on various parameters such as level ofparticipation of the Directors preparing themselves well in advance to take activeparticipation at the meeting(s) level of knowledge and expertise etc.
The Independent Directors of the Company also had a separate meeting on 14th November2019 to review the performance and evaluation of Non- Independent Directors and the Boardas a whole.
The Board after taking into consideration the evaluation as done by the Nomination andRemuneration Committee and by the Independent Directors carried out an annual evaluationof its own performance and that of its Committees and individual Directors. The overalloutcome of such evaluation is that the Board its Committees and all individual Directorshave performed effectively and satisfactorily.
DECLARATION BY INDEPENDENT DIRECTORS
Your Company has received declarations from all the Independent Directors confirmingthat they meet the criteria of independence as prescribed under the provisions of the Actread with the Schedules and Rules issued thereunder as well as clause (b) ofsub-regulation (1) of Regulation 16 of the Listing Regulations (including any statutorymodification(s) or re-enactment(s) thereof for the time being in force). In terms ofRegulation 25(8) of the Listing Regulations the Independent Directors have confirmed thatthey are not aware of any circumstance or situation which exists or may be reasonablyanticipated that could impair or impact their ability to discharge their duties with anobjective independent judgment and without any external influence.
CODE OF CONDUCT
All the Board Members and Key Management Personnel of the Company have affirmedcompliance with the Code of Conduct applicable to the Board Members and Employees of theCompany for the year 2019-20 and a declaration in this regard has been made by the ChiefExecutive Officer which forms a part of this Report as an Annexure.
BOARD AND COMMITTEE MEETINGS
The details of number and dates of Board Meetings and Committee Meetings includingattendance of Directors for the year 2019-20 is given in the attached CorporateGovernance Report. The intervening gap between the meetings was within the periodprescribed under the Companies Act 2013.
DIRECTORS Rs RESPONSIBILITY STATEMENT
In compliance with the provisions of Section 134 of the Companies Act 2013 theDirectors to the best of their knowledge and belief confirm that -
(i) in the preparation of the Annual Accounts the applicable Accounting Standards havebeen followed along with proper explanation relating to material departures;
(ii) the Directors have selected such accounting policies and applied them consistentlyand made judgements 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 as on31st March 2020 and of the Profit of the Company for that period;
(iii) the Directors have taken proper and sufficient care to the best of theirknowledge and ability for the maintenance of adequate accounting and other records inaccordance with the provisions of the aforesaid Act for safeguarding the assets of theCompany and for preventing and detecting fraud and other irregularities;
(iv) the Directors have prepared the annual accounts on a going concern basis;
(v) the Directors have laid down Internal Financial Controls to be followed by theCompany and that such Internal Financial Controls are adequate and have been operatingeffectively; and
(vi) the Directors have devised proper system to ensure compliance with the provisionsof all applicable laws and that such system is adequate and operating effectively.
MATERIAL CHANGES AND COMMITMENTS AFTER THE BALANCE SHEET DATE
There are no material changes and commitments affecting the financial position of thecompany which have occurred between the end of the financial year of the Company to whichthe financial statements relate and the date of this report except that the Board on therecommendations of the Investment and Finance Committee of the Company have vide itsmeeting held on 21st April 2020 approved the proposal for raising of funds by way ofissue of Commercial Papers up to an aggregate amount of Rs 100000 Lakhs.
SIGNIFICANT MATERIAL ORDERS PASSED BY THE REGULATORS/COURTS/ TRIBUNALS
There were no significant material orders passed by the Regulators/Courts/Tribunalsimpacting the going concern status of the Company and its future operations.
INTERNAL FINANCIAL CONTROL
The Company believes that a strong internal control framework is an important pillar ofCorporate Governance. The Company has in place adequate internal financial control systemwhich ensures orderly and efficient conduct of its business safeguarding of its assetsand accuracy and completeness of accounting records timely preparation of reliablefinancial information and various regulatory and statutory compliances.
As required by Regulation 17 (8) of SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 the CEO and CFO certificate for the financial year 2019-20has been submitted to the Board and a copy thereof is contained in the Annual Report.
LISTING OF EQUITY SHARES
The Equity shares of your Company are listed with the National Stock Exchange of IndiaLimited and BSE Limited. The Commercial Papers of the Company issued during the currentfinancial year are listed with BSE Limited.
EXTRACT OF ANNUAL RETURN
An extract of the Annual Return as on 31st March 2020 is attached as Annexure- A inthe prescribed form MGT- 9 in accordance with Section 92(3) of the Companies Act 2013 readwith the Companies (Management and Administration) Rules 2014 which forms part of thisReport and is also available on the Company's website www. pilaniinvestment.com.
KEY MANAGERIAL PERSONNEL
Pursuant to Section 203 of the Companies Act 2013 the Key Managerial Personnel of theCompany are Shri R. P. Pansari Chief Executive Officer Shri N. K. Baheti ChiefFinancial Officer (upto 30.08.2019) Shri J. K. Singhania (w.e.f 02.09.2019) and Shri R.S. Kashyap Company Secretary.
Shri N. K. Baheti ceased to be the Chief Financial Officer of the Company from theclose of business hours on 30th August 2019 and subsequently Shri J. K. Singhania hasbeen appointed as the Chief Financial Officer of the Company with effect from 2ndSeptember 2019.
Remuneration and other details of the Key Managerial Personnel for the year ended 31stMarch 2020 are mentioned in the Extract of the Annual Return which is attached as Annexure- A and forms part of this Report.
TRANSACTIONS WITH RELATED PARTIES
None of the transactions with Related Parties falls under the scope of Section 188 (1)of the Companies Act 2013 for the year ended 31st March 2020. However the NIL disclosurein prescribed form AOC-2 as on 31st March 2020 is attached and the same forms part ofthis Report.
The Company has in place a system of Corporate Governance. A separate Report onCorporate Governance is attached as a part of this Annual Report of the Company. Acertificate from Statutory Auditors of the Company regarding compliance of CorporateGovernance is annexed to the Report on Corporate Governance.
The composition and terms of reference of the Audit Committee have been furnished inthe Corporate Governance Report forming part of this Annual Report. The Company Secretaryis acting as the Secretary of the Committee. The Chief Executive Officer and the ChiefFinancial Officer are permanent invitees to the Audit Committee Meetings to giveclarifications on accounts and related issues. The Board has accepted all therecommendations as and when forwarded by the Audit Committee. The Company has in place avigil mechanism viz. Whistle Blower Policy the details of which are available on theCompany's website www.pilaniinvestment.com.
Other details relating to number of meetings dates of such meetings and the attendanceof each member etc. have been given separately in the attached Corporate GovernanceReport.
NOMINATION AND REMUNERATION COMMITTEE
The composition and terms of reference of the Nomination and Remuneration Committeehave been furnished in the Corporate Governance Report forming part of the Annual Report.The Company Secretary is acting as the Secretary of this Committee. The Committee haddevised a policy named as "Nomination and Remuneration Policy" which has beenduly approved by the Board and a copy of the same is available on the Company's websitewww.pilaniinvestment.com and is also attached as Annexure - B hereto and forms partof this Report.
Other details relating to number of meetings dates of such meetings and attendance ofeach member etc. have been given separately in the attached Corporate Governance Report.
CORPORATE SOCIAL RESPONSIBILITY COMMITTEE
The composition and terms of reference of the Corporate Social Responsibility Committee(CSR Committee) have been given in the Corporate Governance Report forming part of thisAnnual Report. The said Committee has devised a policy named as "Corporate SocialResponsibility Policy" which has been duly approved by the Board and a copy of thesame is available on the Company's website www.pilaniinvestment.com and is also attachedas Annexure- C hereto and forms part of this Report.
Other details relating to number of meetings dates of such meetings and attendance ofeach member etc. have been given separately in the attached Corporate Governance Report.
During the year your Company had contributed Rs 10.00 Lakhs to a Trust workingin the areas which are in consonance with the CSR policy of the Company.
The details of CSR expenditure in prescribed form are annexed as Annexure- D andforms part of this Report. SUBSIDIARIES/ASSOCIATE COMPANIES
The Company has two Subsidiaries and one Associate. Pursuant to the provisions ofSection129 (3) of the Companies Act 2013 a statement containing salient features of thefinancial statements of the Company's Subsidiaries/ Associate in Form AOC-1 is attachedwith this Report.
The Company has in place a proper and efficient Risk Assessment and Management Policywhich identifies evaluates and mitigates the potential business risks.
In compliance with the provisions of Section 204 of the Companies Act 2013 aSecretarial Audit was conducted for the Financial Year 2019-20 by the Secretarial AuditorM/s. K. C. Dhanuka & Company Practicing Company Secretary. The Secretarial Auditor'sReport is attached as Annexure- E and forms part of this Report.
M/s Vidyarthi & Sons Chartered Accountants (ICAI Firm Registration No: 000112C)were appointed as the Statutory Auditors of the Company for a term of 5 years at the 70thAnnual General Meeting (AGM) from the conclusion of the said meeting until the conclusionof the 75th AGM.
During the year the Statutory Auditors have confirmed that they satisfy theindependence criteria required under the Companies Act 2013 and Code of Ethics issued bythe Institute of Chartered Accountants of India.
AUDITORS Rs REPORT/SECRETARIAL AUDITORS Rs REPORT
The observations made in the Auditors Rs Report/Secretarial Auditors Rs Report areself-explanatory and therefore do not call for any further explanation under Section 134(3)(f)(i) of the Companies Act 2013.
Information required under Section 197 of the Companies Act 2013 read with theCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014 as amendedare as per Annexure - F attached hereto and forms part of this Report.
The Company has not accepted/accessed any public deposit during the year. Hence noinformation is required to be appended to this report in terms of Non-Banking FinancialCompanies Acceptance of Public Deposits (Reserve Bank) Directions 2016.
LOANS GUARANTEES AND INVESTMENTS
The Company has not given loans directly or indirectly to any person or other bodycorporate or given any guarantee or provided any security in connection with a loan to anyother body corporate or person during the year under review.
CONSOLIDATED FINANCIAL STATEMENTS
As stipulated by Regulation 33 of the Listing Regulations the Consolidated FinancialStatements have been prepared by the company in accordance with the applicable AccountingStandards. The audited Consolidated Financial Statements together with Auditors RsReport form part of this Annual Report.
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNING AND OUTGO
The Company has no manufacturing activity and therefore the disclosure of particularsas required to be appended under Section 134(3)(m) read with Rule 8(3) of the Companies(Accounts) Rules 2014 in so far as it relates to the Conservation of the Energy andTechnology Absorption is not applicable. No particulars with regard to Foreign ExchangeEarnings and Outgo are required as the Company has no such transactions.
PREVENTION OF SEXUAL HARASSMENT OF WOMEN AT WORK PLACE
During the year under review the Company has not received any complaint under theSexual Harassment of Women at Workplace (Prevention Prohibition and Redressal) Act 2013.
TRANSFER TO INVESTOR EDUCATION AND PROTECTION FUND
During the year under review unpaid/unclaimed dividend for the Financial Year 2011-12has been transferred to the Investor Education and Protection Fund in compliance with theprovisions of Section 124 and 125 of the Companies Act 2013. In compliance with theseprovisions read with the Investor Education and Protection Fund Authority (AccountingAudit Transfer and Refund) Rules 2016 your Company also transferred 658 equity sharesto the Demat Account of the IEPF Authority in respect of which dividend had remainedunpaid/unclaimed for a consecutive period of 7 years.
BUSINESS RESPONSIBILITY REPORT
Pursuant to Regulation 34(2)(f) of the SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 the Business Responsibility Report (BRR) is available asa separate section attached as Annexure - G which forms part of this Report andalso hosted on the Company's website www.pilaniinvestment.com.
MANAGEMENT DISCUSSION & ANALYSIS REPORT
The Management Discussion & Analysis Report (MDA) for the year under review asstipulated under Securities and Exchange Board of India (Listing Obligations andDisclosure Requirements) Regulations 2015 is attached as Annexure - H which formspart of this Report.
APPRECIATION & ACKNOWLEDGEMENTS
The Board of Directors would like to express their sincere appreciation for theassistance and co-operation received from Banks Government Authorities and members duringthe year under review. The Board of Directors also wish to place on record their deepappreciation for the valuable services rendered and commitment displayed by the employeesof the Company and look forward to their continued support in the future as well.
Your Directors wish to record their concerns about your wellbeing with respect toCOVID-19 pandemic. Hope you and your families are doing well and all your loved ones aresafe and sound. We pray to God that we all emerge out of the current situation stronglyand with good health. Please take care and be safe.
| || |
For and on behalf of the Board of Directors
| ||Rajashree Birla ||D. K. Mantri |
| ||Chairperson ||Director |
|July 30 2020 ||(DIN: 00022995) ||(DIN: 00075664) |
| ||Place - Mumbai ||Place - Kolkata |