To the Members
Prakash Steelage Limited
The Board of Directors presents the 28 th (Twenty-Eighth) Annual Report on the Businessand Operations of your Company together with the Audited Financial Statements (Standalone)for the year ended 31st March 2019.
FINANCIAL SUMMARY AND HIGHLIGHTS
The financial highlights of the Company (Standalone) for the year ended 31st March2019 are summarized below :
| || ||(Rs. in Lakhs) |
| ||Year Ended |
|Particulars ||31.03.2019 ||31.03.2018 |
|Total Revenue ||6530.08 ||4930.17 |
|Less: Expenses ||4028.07 ||4556.80 |
|Less: Depreciation ||236.34 ||283.19 |
|Profit / Loss Before Exceptional Item ||2265.67 ||90.18 |
|Less : Exceptional Item ||886.00 ||24916.88 |
|Profit / Loss Before Tax (PBT) ||1379.67 ||(24826.70) |
|Less : Tax ||5.39 ||(750.37) |
|Profit / (Loss) After Tax (PAT) ||1374.28 ||(24076.33) |
(Note : For the Financial Year ending 31st March 2019 the accounts of theCompany has note been consolidated as the Company has not received the Audited Accounts ofTubacex Prakash India Private Limited for the Financial Year 2018-2019)
FINANCIAL PERFOMANCE / OVERVIEW
During the year under review the total revenue for the year ended 31st March2019 is Rs. 6530.08 Lakhs as compared to Rs. 4930.17 Lakhs in the previous year onStandalone basis. The Company's total Profit stood at Rs. 1374.28 Lakhs as compared toprevious year's loss of Rs. (24076.33) Lakhs. Further due to the meltdown in the pricesof nickel chromium molybdenum and unfavorable market for steel industry which had apressure on the realisability of our receivable stock and selling prices.
The Company's loan account is been classified as NPA by the consortium of banks TheCompany has submitted its proposal to the consortium banks towards settlement of itsborrowing through the Assets Reconstruction Company (ARC) route. This proposal is underactive consideration by the consortium banks.
The paid up share capital of the Company as on 31st March 2019 stood atRs.17.50 Crores comprising of 175000390 Equity Shares of Re.1/- each.
During the year under review the Company has not issued shares or convertiblesecurities or shares without differential voting rights nor has granted any employee stockoptions or sweat equity shares.
As on 31st March 2019 none of the Directors of the Company holdinstruments convertible into Equity Shares of the Company.
DIVIDEND AND RESERVES
Your Directors do not recommend any dividend for the Financial Year 201819 onaccount of the accumulated losses. Further your Company has not transferred any amount toits reserves for the Financial Year 201819.
DETAILS OF SUBSIDIARY/JOINT VENTURE/ASSOCIATE
The Company has prepared its Standalone Financial Statements for the Financial Yearended 31st March 2019 as prescribed under Section 133 of the Companies Act2013 read with Rule 7 of the Companies (Accounts) Rules 2014.
The Company has not received the Audited Accounts for the Financial Year 2018-19 inrespect of Tubacex Prakash India Private Limited ("the Associate Company"). Forthe purpose of valuation the unaudited accounts for the Financial Year 2018-19 of theAssociate Company have been considered.
The salient features of the financial statements of Company's associate company aregiven in 'Annexure I' which forms part of this report.
DETAILS IN RESPECT OF ADEQUACY OF INTERNAL CONTROLS WITH REFERENCE TO THE FINANCIALSTATEMENTS
The Company has in place adequate internal financial control with reference tofinancial statements some of which are outlined below.
Your Company has adopted accounting policies which are in line with the IndianAccounting Standards notified under the Companies (Indian Accounting Standards) Rules2015 ("Ind AS") as amended by the Companies (Indian Accounting Standards) Rules2016 The Companies (Indian Accounting Standards) Rules 2017 and that continue to applyunder Section 133 and other applicable provisions if any of the Companies Act 2013 readwith Rule 7 of the Companies (Accounts) Rules 2014 and relevant provisions of theCompanies Act 2013 to the extent applicable. These are in accordance with GenerallyAccepted Accounting Principles (GAAP) in India. Changes in policies if any are approvedby the Audit Committee in consultation with the Auditors.
The Management periodically reviews the financial performance of your Company againstthe approved plans across various parameters and takes necessary action wherevernecessary. Internal Auditors have been appointed which report on quarterly basis on theoperations of the Company. The observations if any of the Internal Auditors areresolved to their satisfaction and are implemented across all the sites.
EXTRACT OF THE ANNUAL RETURN
The details forming part of the extract of the Annual Return in Form MGT 9 inaccordance with Section 92(3) & 134(3) (a) of the Companies Act 2013 read with Rule12(1) of the Companies (Management and Administration) Rules 2014 is annexed as Annexure'II' which forms an integral part of this Report and is also available on theCompany's website viz. www.prakashsteelage.com.
NUMBER OF MEETINGS
a) Board of Directors
The Board of Directors met Four (4) times in the Financial Year. The details of theBoard Meetings and the attendance of the Directors are provided in the CorporateGovernance Report which forms part of the Annual Report. The intervening gap between thetwo (2) meetings did not exceed 120 days in accordance with the provisions of theCompanies Act 2013and the SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 hereinafter referred to as "SEBI (LODR)".
b) Audit Committee
During the year Four (4) Audit Committee Meetings were convened and held. The detailspertaining to composition of Audit Committee and the attendance of the Audit Committeemembers are provided in the Corporate Governance Report which forms part of the AnnualReport. The intervening gap between the two (2) meetings did not exceed 120 days inaccordance with the provisions of the Companies Act 2013 and the SEBI (ListingObligations and Disclosure Requirements) Regulations 2015.
c) Nomination & Remuneration Committee
During the year Two (2) Nomination and Remuneration Committee Meetings were convenedand held. The details pertaining to composition of Nomination and Remuneration Committeeand the attendance of the Nomination and Remuneration Committee members are provided inthe Corporate Governance Report which forms part of the Annual Report.
d) Stakeholders Relationship Committee
During the year One (1) Stakeholders Relationship Committee meeting was -convened andheld. The details pertaining to composition of Stakeholders Relationship Committee and theattendance of the Stakeholders Relationship Committee members are provided in theCorporate Governance Report which forms part of the Annual Report.
SEPARATE MEETING OF THE INDEPENDENT DIRECTORS
Pursuant to Section 149(8) and in terms of requirements of Schedule IV of the CompaniesAct 2013 and Regulation 25(3) of SEBI (LODR) a separate meeting of Independent Directorswas held on 12th February 2019 to review the performance of Non- Independent Directorsthe entire Board and quality quantity and timelines of the flow of information betweenthe Management and the Board.
DIRECTORS' RESPONSIBILITY STATEMENT
In accordance with Section 134(3) (c) of the Companies Act 2013 the Board ofDirectors confirm that:
(a) the preparation of the annual accounts of the Company for the year ended 31 stMarch 2019 the applicable accounting standards have been followed along withproper explanation relating to material departures if any;
(b) the accounting policies as mentioned in the notes to the Financial Statements forthe year ended 31st March 2019 have been selected and applied consistently andmade judgments and estimates that have been made are reasonable and prudent so as to givea true and fair view of the state of affairs of the Company as on 31 st March 2019 and ofthe profit of the Company for the year ended as on that date;
(c) proper and sufficient care has been taken for the maintenance of adequateaccounting records in accordance with the provisions of the Companies Act 2013 forsafeguarding the assets of the Company and for preventing and detecting fraud and otherirregularities;
(d) the annual financial statements for the year ended 31 st March 2019have been prepared on a 'going concern' basis;
(e) the internal financial controls laid down by the company are being followed andsuch internal financial controls are adequate and are operating effectively; and
(f) Proper systems to ensure compliance with the provisions of all applicable laws havebeen devised and such systems were adequate and operating effectively.
DETAILS OF FRAUD REPORTED BY AUDITOR
During the year under review there were no frauds reported by the Auditors to theAudit Committee or the Board under Section 143(12) of the Companies Act 2013.
STATEMENT OF DECLARATION GIVEN BY INDEPENDENT DIRECTORS
Your Company has received declarations from all the Independent Directors viz. Mr. A.Prakashchandra Hegde Mr.Himanshu J. Thaker and Ms. Neetta K. Bokaria confirming that theymeet the criteria of independence as provided in Section 149(6) of the Companies Act 2013and Regulation 16(1)(b) and Regulation 25(8) of the SEBI (LODR).
POLICY ON DIRECTOR'S APPOINTMENT AND REMUNERATION INCLUDING CRITERIA FOR THEIRPERFORMANCE EVALUATION
The Board on the basis of the criteria/manner as recommended by the Nomination &Remuneration Committee of the Board of Directors evaluates the performance of theDirectors pursuant to the provisions of Section 134(3)(p) of the Companies Act 2013 readwith Rule 8(4) of the Companies (Accounts) Rules 2014 framed thereunder along with thecorporate governance requirements as laid down by Securities Exchange Board of India("SEBI") under "SEBI (Listing Obligation & DisclosureRequirements)"Regulations 2015 herein after referred to as the "SEBI(LODR)".
The performance of the Board and its Committees is evaluated by the Board after seekinginputs from all the Directors on the basis of the criteria as recommended by Nomination& Remuneration Committee of the Board of Directors such as adequacy of the compositionof the Board its Committees Board culture execution effectiveness of board processesperformance and functioning of specific duties obligations governance etc. inaccordance with the provisions of Section 134 (3)(p) of the Companies Act 2013 read withrule 8(4) of the Companies (Accounts) Rules 2014 framed there under and the "SEBI(LODR)".
In a separate meeting of Independent Directors performance of Non-IndependentDirectors performance of the Board as a whole and performance of the Chairman isevaluated taking into account the views of Executive Directors and Non-ExecutiveDirectors and also assessed the flow of information between the Management and the Boardto effectively and reasonably perform their duties. The same is discussed in the BoardMeeting that follows the meeting of the Independent Directors at which the performance ofthe Board its Committees and individual Directors is also discussed in accordance withthe requirement of Regulation 25(3) &(4) of the "SEBI (LODR)".
A brief extract of the Remuneration Policy on appointment and remuneration ofDirectors Key Managerial Personnel and Senior Management is provided as AnnexureIII to this Annual Report.
FAMILIARISATION PROGRAMMES FOR INDEPENDENT DIRECTORS
Pursuant to the provisions of Regulation 25(7) of the "SEBI (LODR)" theCompany prepared and pursued the Familiarization Programmes for Independent Directors tofamiliarize them with their role rights and responsibility as Directors the working ofthe Company nature of the industry in which the Company operates business model etc. TheFamiliarisation Programme for Independent Directors of the Company is hosted on Company'swebsite (www.prakashsteelage.com) during the year under review.
At the 27th Annual General Meeting of the Company held on 28th September 2018 M/s.Pipara & Co. LLP Chartered Accountants Mumbai (Firm Registration No.107929W/W-100219) were appointed as the Statutory Auditors of the Company for a period of5(five) years to hold office from conclusion of the 27thAnnual General Meeting of theCompany till the conclusion of the 32ndAnnual General Meeting of the Company to be heldfor the Financial Year 2022-2023.
They have confirmed that they are not disqualified from continuing as Auditors of theCompany.
The management reply on the auditor's qualifications is as under:-
Statement on Impact of Audit Qualifications
Statement on Impact of Audit Qualifications for the Financial Year ended 31st March2019 [See Regulation 33/52 of the SEBI (LODR) (Amendment) Regulations 2016]
| || ||(Rs. in Lakhs) |
|I. Sl. No. Particulars ||Audited Figures (as reported before adjusting for qualifications) ||Adusted Figures (audited figures after adjusting for qualifications) |
|1. Turnover / Total Income ||6530.08 ||6530.08 |
|2. Total Expenditure ||5150.41 ||5150.41 |
|3. Net Profit / (Loss) ||1379.67 ||1379.67 |
|4. Earning Per Share (Re.) ||0.79 ||0.79 |
|5. Total Assets ||5275.25 ||5275.25 |
|6. Total Liabilities ||5275.25 ||5275.25 |
|7. Net Worth ||(26809.51) ||(26809.51) |
|8. Any other financial item(s) (as felt appropriate by the management) ||- ||- |
II. Audit Qualification:
A. Details of Audit Qualification: The account of the Company with its ConsortiumBanks has turned Non Performing Asset on various dates in the previous Financial Years. Inview of uncertainty the Company has not also provided interest including penal interestand other dues for the year ended March 2019 on borrowings to the extent the same haveremained unpaid. The impact of the same on the loss for the year and its consequent effecton the Liabilities and Reserve & Surplus is not ascertainable.
B. Type of Audit Qualification: Qualified Opinion
C. Frequency of qualification: Appeared third time.
D. Management's View: Due to adverse condition in steel industries on account ofdrastic fall in the prices of steel the Company has been suffering losses since couple ofyears which is impacting the net worth of the Company. Loan account had been classified asNPA by the consortium of the banks and Company is not generating revenue to service theloans. Hence in view of uncertainty the Company has not provided interest includingpenal interest and other dues for the year on borrowings; to the extent the same haveremained unpaid.
III. Audit Qualification:
A. Details of Audit Qualification: The Company has accumulated losses resulting inerosion of Net Worth. These conditions cast serious doubt about the company's ability tocontinue as a going concern.
However the statement of audited financial results of the Company has been prepared ona going concern basis.
B. Type of Audit Qualification: Qualified Opinion
C. Frequency of qualification: Appeared Second time
D Management's View: The erosion of net worth of the Company should not beconstituted as doubt on the continuity of the Company as going concern. The steelindustries in on the revival path. The Company is in the process of coming out of thecrisis through business restructuring and financial arrangement.
Emphasis of Matter by Auditor and Management reply on that as follows :
I. Note no. 35 of Ind AS Financial Statement starting that the Company has unfavorablemarket condition for steel industry which has resulted in pressure on the realization ofreceivable stock and selling price.
Management Reply: with respect to the provision made by the Company stipulated byStatutory Auditor as Emphasis of Matter Due to unfavorable market for steel industrythere has been pressure on the realisability of receivables stocks and selling priceswhich has resulted into operational losses during the year ended 31st March 2019.
II. Note no. 36 of Ind. AS Financial Statement stating that the company has submittedis proposal to the consortium banks towards settlement of its borrowing through the AssetsReconstruction Company (ARC) route. This proposal is under the active consideration by theconsortium banks. Meanwhile the bankers have taken symbolic possession of the collateralsof the company comprising of the factory land factory building office building and Plantand Machinery located at Silvasa.
Management Reply: with respect to the provision made by the Company stipulated byStatutory Auditor as Emphasis of Matter the company has submitted its proposal to theconsortium banks towards settlement of its borrowing through the Assets ReconstructionCompany (ARC) route. This proposal is under active consideration by the consortium banks.Meanwhile the bankers have taken symbolic possession of the collaterals of the companycomprising of factory land factory building office building and plant and machinerylocated at Silvasa.
III. Note No. 38 of Ind AS Financial Statement stating that some of the balances ofTrade Receivables Deposits Loans and Advances Advances received from customersLiability for expenses and Trade payable are subject to confirmation from the respectiveparties and consequential reconciliation/adjustment arising there from if any.
Management Reply: with respect to the provision made by the Company stipulated byStatutory Auditor as Emphasis of Matter the balances of Trade Receivables DepositsLoans & Advances Advances received from customers Liability for expenses and TradePayables are subject to confirmation from the respective parties and consequentialreconciliation/adjustment arising there from.
Your Company had received a consent letter from M/s. Amish Parmar & AssociatesCost Accountants as a Cost Auditors of your Company dated 15th May 2019; to continue asthe Cost Auditor of the Company for the Financial Year 2019-20.
The Board on the recommendations made by the Audit Committee in their meeting held on25th May 2019 has approved their appointment as Cost Auditor of the Company inaccordance with the Section 148(3) of the Companies Act 2013 read with Rule 14 (a) (i) ofthe Companies (Audit and Auditors) Rules 2014 and other applicable provisions if any ofthe Companies Act 2013.
The remuneration proposed to be paid to the Cost Auditors subject to the ratificationby the members at the ensuing Annual General Meeting would be Rs.50000/- plus applicableTaxes and out of pocket expenses if any. Necessary resolution seeking your ratificationfor the proposed remuneration to be paid to the Cost Auditors has been included in thenotice of the Annual General Meeting.
Your Company had received the consent letter from M/s. Luniya & Co. CharteredAccountants Mumbai (Firm Registration No. 129787W) dated 16th May 2019 to act as anInternal Auditors of the Company for the Financial Year 2019-20 pursuant to the provisionsof Section 138 of the Companies Act 2013read with Rule 13 (1) (a)of Companies (Accounts)Rules 2014. They have also confirmed their eligibility and willingness to act as InternalAuditors of the Company pursuant to the provisions of the Companies Act 2013 read withrules framed thereunder.
M/s. S. Anantha & Ved LLP (LLP IN: AAH-8229) Practicing Company Secretary wereappointed as the Secretarial Auditors of the Company to conduct Secretarial Audit for theyear under review pursuant to the provisions of Section 204(1) of the Companies Act 2013read with Rule 9 of the Companies (Appointment and Remuneration of Managerial Personnel)Rules 2014.
The Secretarial Audit Report for the year under review is annexed as 'Annexure IV' tothis report.
Necessary explanation to the observations made in the Secretarial Audit Report is givenbelow:
There are some delays in filing e-forms of the Company with MCA. The Board hasdirected the management to take care of the same & to avoid the delay in future.
The Company has not received the Audited Accounts of Tubacex Prakash IndiaPrivate Limited for the Financial Year 2018-19 so the accounts of the Company has notbeen consolidated.
Due to adverse condition in steel industries on account of drastic fall in theprices of steel the Company has been suffering losses since couple of years which isimpacting the net worth of the Company. Loan account had been classified as NPA by theconsortium of the banks and Company is not generating revenue to service the loans. Hencein view of uncertainty the Company has not provided interest including penal interest andother dues for the year on borrowings to the extent the same have remained unpaid.
The erosion of net worth of the Company should not be constituted as doubt onthe continuity of the Company as going concern. The steel industries in on the revivalpath. The Company is in the process of coming out of the crisis through businessrestructuring and financial arrangement.
Though the Company transferred the unpaid/ unclaimed dividend of the FinancialYear 2010-11 the underlying relevant shares could not be transferred to the IEPF Accountdue to certain difficulties faced in retrieving the data.
The same is now sorted out and necessary actions have been initiated to transfer theunderlying shares by October 15 2019. Henceforth the Board has ensured that pursuant tothe provisions of Section 124(6) of the Companies Act 2013 and the Investor Education andProtection Fund Authority (Accounting Audit Transfer and Refund) Rules 2016 as amendedfrom time to time all equity shares of the Company on which dividend has not been paid orclaimed for seven consecutive years or more shall be transferred by the Company toInvestor Education and Protection Fund ("IEPF").
With respect to delayed payments to those MSME the Company has made provisionfor interest on such delayed payments and initiated necessary steps to make payment withinstipulated time in future.
PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS UNDER SECTION 186 OF THE COMPANIES ACT2013
Details of Loans Guarantees and investments if any covered under the provisions ofSection 186 of the Companies Act 2013 read with Rule 11 of the Companies (Meetings ofBoard and its Powers) Rules 2014are given in the Note no. 04 to the Standalone FinancialStatements of the Company for the year under review.
PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES REFERRED TO IN SUB-SECTION (1) OF SECTION 188 OF THE COMPANIES ACT 2013
All contract(s) / arrangement(s) /transaction(s) entered into by the Company with itsrelated parties are in compliance with the provisions of Section 188 (1) of the CompaniesAct 2013 read with Rules 6 A & 15 of the Companies (Meetings of Board and its Powers)Rules 2014 and Regulation 23 of SEBI (LODR) Regulations 2015.
There are no materially significant Related Party Transactions entered into by theCompany with promoters Directors Key managerial Personnel which may have potentialconflict with the interest of the Company at large.
Accordingly Form AOC-2 prescribed under the provisions of Section 134(3) (h) of theCompanies Act 2013 read with the Rule 8(2) of the Companies (Accounts) Rules 2014 fordiscloser of details of Related Party Transaction which are "not at arm's lengthbasis" and which are "Material and at arm's length basis" is not providedas an annexure of the Board's Report.
All Related Party Transactions are placed before the Audit Committee for review andapproval. Prior omnibus approval is obtained for Related Party Transactions on a quarterlybasis for transactions which are of repetitive nature and/or entered in the ordinarycourse of business and are at arm's length.
Your Company has formulated a Policy on Related Party Transactions which is alsoavailable on Company's website at www.prakashsteelage.com.
The Policy intends to ensure that proper reporting approval and disclosure processesare in place for all transactions between the Company and Related Parties. This Policyspecifically deals with the review and approval of Material Related Party Transactionskeeping in mind the potential or actual conflicts of interest that may arise because ofentering into these transactions.
The particulars of every contract(s) or arrangements entered into by the Company withrelated parties referred to in subsection (1) of Section 188 of the Companies Act 2013including certain arms length transactions under third proviso thereto given as per point31 of notes which forms part to financial statement which is provided in this report.
MATERIAL CHANGES AND COMMITMENTS IF ANY 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 THE REPORT AS STIPULATED UNDER SECTION134(3)(l) OF THE COMPANIES ACT 2013
Except as disclosed elsewhere in this report there have been no material changes andcommitments which can affect the financial position of the Company between the end of theFinancial Year as on March 31 2019 of the Company and date of this report.
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION FOREIGN EXCHANGE EARNINGS AND OUTGOASSTIPULATED UNDER SECTION 134(3)(m) OF THE COMPANIES ACT 2013 READ WITH RULE 8 (3) OF THECOMPANIES (ACCOUNTS) RULES 2014
The details of conservation of energy technology absorption foreign exchange earningsand outgo are stated in 'Annexure V' to this report as required under Section134(3)(m) of the Companies Act 2013 read with Rule 8(3) of the Companies (Accounts)Rules 2014.
The Company has in place a Risk Management System with the Objective to formalize theprocess of Identification of Potential risk and adopt appropriate risk mitigation measuresthrough a risk management structure which takes care of risk identification assessmentand mitigation. This system is a step by the Company towards strengthening the existinginternal controls and updating the same as may be required from time to time. Risk factorsand its mitigation are covered extensively in the Management Discussion and AnalysisReport forming part of this Report.
Further the Board has dissolved Risk Management Committee w.e.f. 12th November 2018as per Regulation 21 of Securities and Exchange Board of India (Listing Obligations andDisclosure Requirements) Regulations 2015 amended on 9th May 2018 which specifies thatthe Constitution of Risk Management Committee is Mandatory for top 500 Listed Companies.
CORPORATE SOCIAL RESPONSIBILITY ("CSR") INITIATIVES
The brief outline of the Corporate Social Responsibility ("CSR") Policy ofthe Company and the initiatives undertaken by the Company on CSR activities during theyear under review are set out in 'Annexure VI' of this report in the formatprescribed in the Companies (Corporate Social Responsibility Policy) Rules 2014.
Details with respect to the composition and scope of the CSR Committee are provided inthe Corporate Governance Section which forms part of this Annual Report. The Company hasaccumulated losses and is not liable to incur any expenditure towards CSR.
The CSR Policy of the Company framed under Section 135 of the Companies Act 2013 readwith the Companies (Corporate Social Responsibility Policy) Rules 2014 is available onthe website of the Company (www.prakashsteelage.com).
The Company has not accepted any Deposit from public during the year under reviewwithin the meaning of the provisions of Section 73 of the Companies Act 2013 read withChapter V of the Companies (Acceptance of Deposits) Rules 2014.
DIRECTORS AND KEY MANAGERIAL PERSONNEL
Further in accordance with the provisions of Section 152(6)(d) of the Companies Act2013 read with the Companies (Appointment and Qualification of Directors) Rules 2014 andthe Articles of Association of the Company Mr. Hemant P. Kanugo(DIN: 00309894) WholeTime Director of the Company will retire by rotation at the ensuing 28thAnnual GeneralMeeting and being eligible for re-appointment has offered himself for re-appointment.Necessary resolution for his appointment also forms part of the Notice for the ensuing28th Annual General Meeting of the Company.
Mr. A. Prakashchandra Hegde (DIN: 02266510) & Mr. Himanshu J. Thaker (DIN:02325297) had been appointed as Independent Directors to hold office from 30th March2014 up to 31st March 2019. Your Board of Directors has reappointed them as Additional(Independent) Directors of the Company in terms of Section 149 of the Act and subject toapproval of the members by Special Resolution for second term of (5) Five consecutiveyears with effect from 1st April 2019 up to 31st March 2024 with the periodof office not liable to be determined by retirement of Directors by rotation.
In accordance with the Section 149(7) of the Act each Independent Director has given awritten declaration to the Company at the time of appointment and at the first meeting ofthe Board of Directors in every financial year confirming that he/she meets the criteriaof independence as mentioned under Section 149(6) of the Act and Regulation 16(1) (b) ofthe LODR 2015.
During the year under review the Company has appointed Mr. Prakash C. Kanugo Chairmanand Managing Director and Mr. Hemant P. Kanugo as Whole-time Director.
The Board of Directors at their meeting held on 13th August 2019 has proposed thenomination of Mr. Ashok M. Seth as Executive Director (Whole-time Director) of TubacexPrakash India Private Limited a Joint Venture Company between Prakash Steelage Limitedand Tubacex. Accordingly Mr. Ashok M. Seth has tendered his resignation as CFO andWhole-time Director of the Company. Mr. Ashok M. Seth is continuing on the Board ofDirectors of the Company only as a Director w.e.f. 13th August 2019 (closure of workinghours). Mr. Hemant P. Kanugo the Whole-time Director has been given redesignated asWhole-time Director & CFO.
During the year under review Ms. Shikha A. Mishra has resigned from the designation ofCompany Secretary & Compliance Officer of the Company on 23rd April 2019.
Further on the recommendation of the Nomination and Remuneration Committee andapproval of Board in their meeting held on 25th May 2019 of the Company Ms. Leela S.Bisht has been appointed as the Company Secretary & Compliance Officer of the Companysubject to the allotment of Membership Number by ICSI. Till the period she will holding aposition of Assistant Company Secretary of the Company.
As required under the provisions of the Companies Act 2013 and Regulation 36(3) of theSEBI (LODR) Regulations 2015 brief resume and other details of Director beingre-appointed are provided as Annexure A to the Notice of the ensuing28thAnnual General Meeting of the Company.
In accordance with Section 2(51) and 203 of the Companies Act 2013 read with theCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014 thefollowing are the Key Managerial Personnel of the Company: 1.Mr. Prakash C. KanugoChairman & Managing Director; 2.Mr. Ashok M. Seth Whole-Time Director & ChiefFinancial Officer.*
* Mr. Ashok M. Seth has resigned from the designation of Executive Director & ChiefFinancial Officer and appointed as Non-Executive Director w.e.f. 13th August 2019(closure of working hours.)
Mr. Hemant P. Kanugo Whole time Director has been appointed as a Chief FinancialOfficer of the Company w.e.f. 13th August 2019 (Closure of working hours)& "re-designated as Executive Director & Chief Financial officer" forthe remaining term of his office of Whole-time Director i.e up to30 September 2023.
DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS ORTRIBUNALS IMPACTING THE GOING CONCERN STATUS AND COMPANY'S OPERATIONS IN FUTURE
Pursuant to Section 134(3)(q) of the Companies Act 2013 read with Rule 8(5)(vii) ofthe Companies (Accounts) Rules 2014 no significant or material orders were passed by theRegulators or Courts or Tribunals which impacts the going concern status and Company'sfuture operations.
INTERNAL FINANCIAL CONTROL SYSTEMS
Your Company has an effective internal control and risk mitigation system which isconstantly assessed and strengthened with new / revised standard operating procedurespursuant to Section 134(3)(q) of the Companies Act 2013 read with Rule 8(5)(viii) of theCompanies (Accounts) Rules 2014 and Regulation 18(3) of SEBI (LODR) Regulations 2015.
The Company had entrusted the internal audit to M/s. Luniya & Co. CharteredAccountants Mumbai (Firm Registration No. 129787W). However the initial objective of theinternal audit process is to test and review of controls independent appraisal of risksbusiness process and bench marking internal controls with best practices.
The Audit Committee of the Board of Directors actively reviews the adequacy andeffectiveness of the internal control systems and suggests improvements to strengthenthem.
The Company has a robust Management Information System which is an integral part ofthe control mechanism.
The members of Audit Committee and Statutory Auditors are periodically apprised of theInternal Audit findings and corrective action taken. Internal audit plays a key role inproviding assurance to the Board of Directors.
|COMPOSITION OF THE COMMITTEES || |
|Audit Committee ||1. Mr. A. Prakashchandra Hegde (Chairman) |
| ||2. Mr. Himanshu J. Thaker (Member) |
| ||3. Mr. Ashok M. Seth (Member) |
| ||4. Mrs. Neetta K. Bokaria (Member) |
|Nomination & Remuneration Committee ||1. Mr. Himanshu J. Thaker (Chairman) |
| ||2. Mr. A. Prakashchandra Hegde (Member) |
| ||3. Mrs. Neetta K. Bokaria (Member) |
|Stakeholders' Relationship Committee ||1. Mr. A. Prakashchandra Hegde (Chairman) |
| ||2. Mr. Himanshu J. Thaker (Member) |
| ||3. Mr. Ashok M. Seth (Member) |
|Corporate Social Responsibility Committee ||1. Mr. A. Prakashchandra Hegde (Chairman) |
| ||2. Mr. Ashok M. Seth (Member) |
| ||3. Mr. Hemant P. Kanugo (Member) |
|* Risk Management Committee ||1. Mr. Ashok M. Seth (Chairman) |
| ||2. Mr. Prakash C. Kanugo (Member) |
| ||3. Mr. Hemant P. Kanugo (Member) |
|Executive Committee ||1. Mr. Prakash C. Kanugo (Chairman) |
| ||2. Mr. Ashok M. Seth (Member) |
| ||3. Mr. Hemant P. Kanugo (Member) |
* Dissolved w.e.f. 12th November 2018.
The brief details with respect to the constitution meetings scope and functions ofthe above mentioned Committees of the Company have been provided in Corporate Governancesection forming part of this Annual Report.
VIGIL MECHANISM UNDER WHISTLE BLOWER POLICY
Pursuant to Section 177(9) and (10) of the Companies Act 2013 read with Rule 7 of theCompanies (Meetings of Board and its Powers) Rules 2014 and Regulation 22 of "SEBI(LODR)" the Board of Directors has on recommendation of its Audit Committee adopted'Whistle Blower Policy" at their meeting held on 29th May 2014 for Directors andEmployees of the Company to report concerns about unethical behavior actual or suspectedfraud or violation of your Company's Code of Conduct and to voice genuine concerns orgrievances about unprofessional conduct without fear of reprisal. Adequate safeguards areprovided against victimization to those who avail of the mechanism and direct access tothe Chairman of the Audit Committee in exceptional cases is provided to them.
None of the personnel of the Company has been denied access to the Audit Committee ofthe Board of Directors of the Company. The said policy is hosted on the website of theCompany (www.prakashsteelage.com).
PARTICULARS OF EMPLOYEES AS PER SECTION 197(12) & RULE 5 OF THE COMPANIES(APPOINTMENT AND REMUNERATION OF MANAGERIAL PERSONNEL) RULES 2014
Details of employee remuneration as required under provisions of Section 197 (12) ofthe Act read with Rule 5(1) of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014 is annexed as Annexure VII to the Report.
The details of top ten employees of the Company is annexed as Annexure VII-A tothis Report.
None of the Employee has drawn the remuneration more than the limit prescribed underRule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules2014.
MANAGEMENT DISCUSSION AND ANALYSIS
Management Discussion and Analysis Report for the year under review as stipulatedunder Regulation 34(2)(e)& 34(3) of the "SEBI (LODR)"is presented in aseparate section forming part of this Report.
Your Company is committed to follow the best practices of Corporate Governanceincluding the requirements under the "SEBI (LODR)" and the Board is responsibleto ensure the same from time to time.
The Company has duly complied with the Corporate Governance requirements as set outunder Regulation 34(3) and Schedule V of the "SEBI (LODR)" from time to timeand the Secretarial Auditors of the Company viz. M/s. S. Anantha & Ved LLP CompanySecretaries have con3rmed vide certificate dated 13th August 2019 that the Company isand has been compliant with the conditions stipulated in the Regulation 34(3) and ScheduleV of the "SEBI (LODR)".
The said certificate is annexed to this report as 'Annexure-VIII'. Further aseparate report on Corporate Governance forms part of this Annual Report.
DISCLOSURES UNDER SEXUAL HARASSMENT OF WOMEN AT THE WORKPLACE (PREVENTION PROHIBITION& REDRESSAL) ACT 2013
Your Company has formulated a Policy known as "The Anti Sexual HarassmentPolicy" ("Policy") which aims to provide a safe working environment andprohibits any form of sexual harassment. This policy intends to prohibit occurrences ofany form of sexual harassment and also details procedures to follow when an employeebelieves that a violation of the policy has occurred within the ambit of all applicableregulations regarding Sexual harassment. The said policy is hosted on the website of theCompany (www.prakashsteelage.com).
In line with the requirements of the Sexual Harassment of Women at the Workplace(Prevention Prohibition & Redressal) Act 2013 the Board has constituted an InternalComplaints Committee ("ICC") to redress the complaints received regarding sexualharassment. All employees (whether permanent contractual temporary trainee) are coveredunder this policy.
Pursuant to the requirements under Chapter VIII Miscellaneous vide Section 22 ofthe Sexual Harassment of Women at Workplace (Prevention Prohibition and Redressal) Act2013 that the Company has not received any complaint of sexual harassment during the yearunder review. Further the Company conducts awareness programme at regular interval oftime.
SECRETARIAL STANDARDS ISSUED BY THE INSTITUTE OF COMPANY SECRETARIES OF INDIA (ICSI)
The Company complies with the provisions of applicable Secretarial Standards issued byICSI.
CHANGE IN THE NATURE OF BUSINESS IF ANY
During the financial year under review there has been no change in the business of theCompany or in the nature of business carried by the Company.
Your Directors wish to take the opportunity to place on record their sincereappreciation and gratitude to Stock Exchanges Shareholders Banks GovernmentAuthorities Business Associates and other Stakeholders for their continuous support. TheBoard also recognizes the contribution of its valued customers for the Significant growthof the Company and takes this opportunity to pledge the Company's commitment to serve thembetter.
Your Directors wish to convey their appreciation for the Senior Leadership Team and allthe Employees of the Company for their enormous efforts at the individual level as well astheir collective contribution for the successful performance of the Company.
| ||For and on Behalf of the Board of Directors |
| ||Prakash Steelage Limited |
| ||Sd/- |
| ||Prakash C. Kanugo |
|Date : 13th August 2019 ||Chairman & Managing Director |
|Place : Mumbai ||DIN: 00286366 |