PRATIKSHA CHEMICALS LIMITED
Your Directors have pleasure in presenting herewith their 28thAnnual Reporton the business and operation of the Company together with the Audited Statements ofAccounts of the Company for the year ended on 31st March 2019.
1. STATE OF AFFAIRS OF THE COMPANY:
Pratiksha Chemicals Ltd is an industry representing color pigment companies inAhmedabad India. The company is engaged into manufacturing business of Pigment Green 7& Copper Phthalocyanine Green Crude. It represents small medium and large colorpigments manufacturers throughout India accounting for the bulk of the production ofcolor pigments in India.
The company supplies superior quality Pigment Green 7 all over India. The manufacturingunit of the Company is located at Sanand Dist- Ahmedabad. Color pigments are widely usedin product compositions of all kinds including paints inks plastics glass syntheticfibers ceramics colored cement products textiles cosmetics and artists' colors.
? SEGMENT-WISE POSITION OF BUSINESS AND ITS OPERATIONS: The Company is currentlyengaged in only one business i.e. manufacturing business of Pigment Green 7 & CopperPhthalocyanine Green Crude. Accordingly there is no segments of business activity of theCompany
? CHANGE IN STATUS OF THE COMPANY: The status of the company has not beenchanged during the financial year 2018-19.
? KEY BUSINESS DEVELOPMENTS;
The manufacturing units has a well equipped laboratory assisted by a team of chemistsand researchers for consistent Research and Development and support the Quality ControlSystem which keeps an eye on the production process to yield the best from theseproduction units.
? CHANGE IN THE FINANCIAL YEAR: The company has not changed its financial yearduring the year.
? CAPITAL EXPENDITURE PROGRAMMES: Not Applicable
? DETAILS AND STATUS OF ACQUISITION MERGER EXPANSION MODERNIZATION ANDDIVERSIFICATION: Not Applicable
? DEVELOPMENTS ACQUISITION AND ASSIGNMENT OF MATERIAL INTELLECTUAL PROPERTY RIGHTS:Not Applicable
? ANY OTHER MATERIAL EVENT HAVING AN IMPACT ON THE AFFAIRS OF THE COMPANY:. Nomaterial events have occurred during the financial year 2018-19 which impact on theaffairs of the Company.
2. FINANCIAL SUMMERY:
The Directors' Report is to be prepared based on the stand alone financial statementsof the company:
(Rs. In Lacs)
|PARTICULARS ||2018-19 ||2017-18 |
|Revenue from Operations ||1158.59 ||1116.62 |
|Other income ||1.54 ||8.25 |
|Total Income ||1160.13 ||1124.87 |
|Profit/loss before Depreciation Finance ||56.21 ||55.64 |
|Costs Exceptional items and Tax || || |
|Expense || || |
|Less: Depreciation ||29.10 ||28.15 |
|Profit/loss before Finance Costs ||27.11 ||27.49 |
|Exceptional items and Tax Expense || || |
|Less: Finance Cost ||19.02 ||13.64 |
|Profit/loss before Exceptional items and ||8.09 ||13.85 |
|Tax Expense || || |
|Less: Exceptional Items ||- ||- |
|Profit / (Loss) Before Tax ||8.09 ||13.85 |
|Provision for Tax & Deferred Tax ||7.40 ||10.98 |
|Profit / (Loss) After Tax ||0.69 ||2.87 |
|Other Comprehensive income (net of tax effect) ||- ||- |
|Total Comprehensive income ||0.69 ||2.87 |
|Add : Balance as per last Financial ||(263.80) ||(266.66) |
|Statement || || |
|Disposable Surplus ||- ||- |
|Less : Transfer to General Reserve ||- ||- |
|Dividend Paid (17-18) ||- ||- |
|Dividend Paid (16-17) ||- ||- |
|Dividend Distribution Tax (17-18) ||- ||- |
|Dividend Distribution Tax (16-17) ||- ||- |
|Balance carried forward ||(263.11) ||(263.80) |
3. PERFORMANCE OF THE COMPANY (STANDALONE):
The company's approach towards growth has delivered satisfactory results in terms of
Turnover of the company during the year 2018-19. Your company achieved the net sales ofRs. 1158.59 lakhs during the year 2018-19 which indicates 3.76% increase in turnover ascompare to the last year.
The Company has earned net Profit (After Tax) of Rs. 0.69 lakhs during the financialyear 2018-19. However the Profitability is low based on size of the company but thecompany will strive to improve its performance in long term prospects based on actual paceof global economy.
With a view to enlarge the business operations of the Company the Directors did notrecommend dividend during the year under review.
5. THE AMOUNTS IF ANY WHICH IT PROPOSES TO CARRY TO ANY RESERVES;
The company has not transferred any amount to reserves during the financial year2018-19.
6. DIRECTORS AND KEY MANAGERIAL PERSONNEL:
Pursuant to the provisions Section 152(6) of the Companies Act 2013 Mr. HarishbhaiBhatt (DIN: 00400765) Director of the Company retires by rotation at the forthcomingAnnual General Meeting and being eligible offer himself for reappointment.
Mrs. Monika Chauhan has been appointed as an additional Independent Woman director ofthe Company by the Board of Directors of the Company in its meeting held on 21stJanuary 2019 upto the forthcoming Annual General Meeting. The Board of Directors hasproposed the appointment of Mrs. Monika Chauhan as Director for the term of five years.
The present term of appointment of Independent Directors of the Company is going to beexpired at the forthcoming Annual General Meeting. The Board has subject to the approvalof the Members in the forthcoming AGM proposed the re-appointment of followingIndependent Directors for another period of five years with effect from 27thSeptember 2019:
|SR. NO. NAME OF DIRECTOR |
|1 MR. UPENDRA ADHVARYU |
|2 MR. SOMABHAI PATEL |
The Company has received declarations from all the Independent Directors of the Companyconfirming that they meet with the criteria of independence as prescribed undersub-section 6 of Section 149 of the Companies Act 2013 and under Regulation 16 b) of SEBI(Listing Obligations and Disclosure Requirements) Regulation 2015 and complied with theCode for Independent Directors prescribed in Schedule IV to the Act.
? JUSTIFICATION FOR APPOINTMENT / REAPPOINTMENT OF INDEPENDENT DIRECTORS:
The existing Independent Directors of the Company are engaged with the Company frommore than 10 years and having vast experience and profound knowledge with respect toworkings of the Company. They also possess industry specific knowledge and skills which isbeneficial for growth of the Company. The Company can reach higher level of growth interms of business expansion and turnover under their guidance and leadership. Mrs. MonikaChauhan the proposed Independent Director is also qualified as graduate having goodskills and knowledge in the industry.
During the current financial year there is no change in the directors of the Company.However MRS. ACHARYA LALITHAMMA RAMAKRISHNAN an Independent Director of the Company hasresigned from the directorship of the Company as on 13th February 2019 due toher pre occupation in other Companies. The Board places on record its appreciation for hisinvaluable contribution and guidance. MRS. ACHARYA LALITHAMMA RAMAKRISHNAN has alsoconfirmed that there is no other material reason of resignation other than those provided.
During the year under review the non-executive directors of the Company had nopecuniary relationship or transactions with the Company other than sitting feescommission and reimbursement of expenses incurred by them for the purpose of attendingmeetings of the Board/Committee of the Company.
The Company has received declarations from all the Independent Directors of the Companyconfirming that they meet with the criteria of independence as prescribed undersub-section 6 of Section 149 of the Companies Act 2013 and under Regulation 16 (b) ofSEBI (Listing Obligation and Disclosure Requirements) Regulation 2015.
During the yearSeven Board Meetings and Four Audit Committee Meetings were dulyconvened and held. The dates on which the said Board Meetings held are shown in the table:
|SR. NO. ||BOARD MEETING ||AUDIT COMMITTEE |
|1 ||30.05.2018 ||30.05.2018 |
|2 ||14.08.2018 ||14.08.2018 |
|3 ||05.11.2018 ||05.11.2018 |
|4 ||21.01.2018 ||13.02.2019 |
|5 ||13.02.2019 || |
|6 ||19.03.2019 || |
|7 ||26.03.2019 || |
The intervening gap between the Meetings was within the period prescribed under theCompanies Act 2013. The necessary quorum was present at the meetings.
The company has several committees which have been established as a part of bestcorporate governance practices and are in compliance with the requirements of the relevantprovisions of applicable laws and statues.
The Board has constituted following Committees:
Nomination and Remuneration Committee
Stakeholder's Relationship Committee
Internal Complaints Committee
The details with respect to the compositions powers roles terms of reference etc. ofrelevant committees are given in detail in the Report on Corporate Governance' ofthe company which forms part of this Annual Report.
9. EXTRACTS OF ANNUAL RETURN:
Pursuant to sub-section 3(a) of Section 134 and sub-section (3) of Section 92 of theCompanies Act 2013 read with Rule 12 of the Companies (Management and Administration)Rules 2014 the extracts of the Annual Return as at March 31 2019 forms part of thisDirectors' Report as Annexure: I'.
10.STATUTORY AUDITORS & AUDIT REPORT:
Pursuant to the provisions of Section 139 of the Companies Act 2013 M/S. H K SHAH& CO. Chartered Accountants (Firm Registration No. 109583W) have been appointedas statutory auditors of the company at the Twenty Third Annual General Meeting held onSeptember 30 2014 to hold office from the conclusion of twenty third Annual GeneralMeeting (AGM) till the conclusion of the Twenty eighth Annual General Meeting of theCompany.
Accordingly the term of existing auditor is completed in this AGM and the board ofDirectors of the Company has appointed M/S. CHANDABHOY & JASSOOBHOY CharteredAccountants (F.R.NO. 101648W) as a statutory auditor of the Company to hold office tillthe conclusion of AGM of financial year 2023-24 subject to the approval of shareholders atAGM.
The Auditors comments on your company's accounts for year ended March 31 2019 areself-explanatory in nature and do not require any explanation as per provisions of Section134(3) (f) of the Companies Act 2013.
There are following qualifications reservation or adverse remark or disclaimer made byStatutory Auditor in its report:
1. Adhering to significant accounting policy the Company is accountingfor Gratuity & Leave Encashment on cash basis. This is not according with IND AS 1 on"Presentation of Financial Statement" and IND AS-19 on "EmployeeBenefits" prescribed by the Institute of Chartered Accounting of India and contraryto provision contained in Section 133 of the Companies Act 2013. The extent ofnon-compliance in terms of value is not ascertainable.
2. IND AS 2 for "Inventories" has not been followed. Thetechnical valuation claimed by the Company is not quantifiable hence; we are not in aposition to quantify the effect on the Profit and Loss Account and Balance Sheet.
3. IND AS 101 requires the company to make an explicit and unreservedstatement in the Financial Statements of compliance with IND Ass. However the same hasnot made. Hence the extent of Non- compliance in terms of value is not ascertainable.
The Board of Directors has undertaken to take the corrective steps for the abovementioned qualifications in current financial year.
11. DISCLOSURE OF REPORTING OF FRAUD BY AUDITORS UNDER SECTION 143(12):
During the financial year 2018-19 the Statutory Auditor has not reported to the auditcommittee any instance of fraud committed against the Company by its employees or officersunder section 143(12) the details of which need to be reported in Board's
12. INTERNAL FINANCIAL CONTROLS & INTERNAL AUDITOR:
Pursuant to provisions of 138 of the Companies Act 2013 and Rule 13 of Companies(Accounts) Rules 2014 M/S. LAVINGIYA & ASSOCIATES Chartered AccountantsAhmedabad has been appointed as an Internal Auditor of the Company for the Financial Year2019-20. During the year the Company continued to implement their suggestions andrecommendations to improve and control the environment. Their scope of work includesreview of processes for safeguarding the assets of the Company review of operationalefficiency effectiveness of systems and processes and assessing the internal controlstrengths in all areas. Internal Auditors findings are discussed with the process ownersand suitable corrective actions taken as per the directions of Audit Committee on anongoing basis to improve efficiency in operations.
Pursuant to Section-148 (1) of the Companies Act 2013 read with Rule 3 of Companies(Cost Records and Audit) Rules 2014 Company does not fall under the criteria formaintaining cost record for the financial year 2018-19.
14.SECRETARIAL AUDITORS AND SECRETARIAL AUDIT REPORT:
Pursuant to Section 204 of the Companies Act 2013 your company had appointed M/S.A. SHAH & ASSOCIATES Practicing Company Secretaries Ahmedabad as itsSecretarial Auditors to conduct the Secretarial Audit of the company for F.Y. 2018-19. TheReport of the Secretarial Auditor for the F.Y. 2018-19 is annexed to this report as
Annexure: II' to the Directors' Report.
The Board of Directors of the Company has discussed the remarks as mentioned inSecretarial Audit Report at arm's length. The qualification raised by the SecretarialAuditor in its report and the justification of Board of Directors on the same are asfollows:
|SR. QUALIFICATION ||JUSTIFICATION OF BOARD |
|NO || |
|1. 100% shares of Promoters are not in DEMAT ||The Company has taken steps to ensure that the physical shares held by promoter or promoter group are fully converted into DEMAT. |
| ||Accordingly only one promoter is holding shares in physical as on 31st March 2019 which has been converted into DEMAT IN June 2019.Accordingly 100% shareholding of promoter is in demat. |
|2 Delay in confirmation of ||The Delay in confirmation of application received for Dematerialization of shares was due to technical issues. dematerialization requests received from shareholder. |
15.NOMINATION AND REMUNERATION POLICY:
The Board has on the recommendation of Nomination and Remuneration/
Compensation Committee framed a policy on directors' appointment and remuneration ofDirectors including criteria for determining qualification positive attributesindependence of directors and remuneration for Directors Key Managerial Personnel andother employees. The policy is annexed to this report as Annexure: III'.
The Board of Directors has carried out an annual evaluation of its own performanceBoard committees and individual directors pursuant to the provisions of the Companies Act2013 the corporate governance requirements as prescribed by Securities and
Exchange Board of India ("SEBI") under Regulation 17 to 27 and clauses (b) to(i) of sub-regulation (2) of regulation 46 and para C D and E of Schedule V of SEBI(Listing Obligation and Disclosure Requirement) Regulation 2015.
The performance of the Board was evaluated by the Board after seeking inputs from allthe directors on thebasis of the criteria such as the Board composition and structureeffectiveness of board processes informationand functioning etc.The performance of thecommittees was evaluated by the board after seeking inputs from the committee membersonthe basis of the criteria such as the composition of committees effectiveness ofcommittee meetings etc.
The Board and the Nomination and Remuneration Committee ("NRC") reviewed theperformance of the individual directors on the basis of the criteria such as thecontribution of the individual director to the Board andcommittee meetings likepreparedness on the issues to be discussed meaningful and constructive contributionandinputs in meetings etc. In addition the Chairman was also evaluated on the key aspectsof his role. In a separate meeting of independent Directors performance ofnon-independent directors performance of the board as a whole and performance of theChairman was evaluated taking into account the views of executive directors andnon-executive directors. The same was discussed in the board meeting that followed themeetingof the independent Directors at which the performance of the Board its committeesand individual directorswas also discussed.
Your Company has not accepted any fixed deposits from the public within the provisionsof Section 73 to 76 of the Companies Act 2013. Hence the disclosures required as perRule 8(5)(v)&(vi) of the Companies (Accounts) Rules 2014 read with Section 73 to 76of the Companies Act 2013 are not applicable to your Company.
The Company believes that good Corporate Governance is a continuous process and it isour continuous endeavor to achieve good governance by way of a conscious andconscientious effort whereby ensuring the truth transparency accountability andresponsibility in all our dealings with all our stakeholders.
A separate section on Corporate Governance Standards followed by your Company asstipulated under Regulation 34(3) read with Schedule V of SEBI (Listing Obligation andDisclosure Requirement) Regulation 2015 is enclosed as Annexure to this Report. The Reporton Corporate Governance also contains certain disclosures required under Companies Act2013.
A Certificate from M/S. A. SHAH & ASSOCIATES. Practicing Company Secretariesconforming compliance to the conditions of Corporate Governance as stipulated underRegulations 17 to 27 and clauses (b) to (i) of sub-regulation (2) of regulation 46 andpara C D and E of Schedule Vof SEBI (Listing Obligation and Disclosure Requirement)Regulation 2015 is annexed to this Report.
19.FOREIGN EXCHANGE EARNINGS / OUTGO:
As the Company has not carried out any activities relating to the export and importduring the financial year. There is no foreign exchange expenses and foreign income duringthe financial year 2018-19.
In pursuant to the provisions of section 177(9) & (10) of the Companies Act 2013a Vigil Mechanism for directors and employees to report genuine concerns has beenestablished. The Vigil Mechanism Policy has been uploaded on the website of the Company atwww.pratikshachemicals.in under investors / policy documents / Vigil Mechanism Policylink.
21. CONSERVATION OF ENERGY & TECHNOLOGY ABSORPTION:
(a)Conservation of energy:
|(i) the steps taken or impact on conservation of energy ||N.A. |
|(ii) the steps taken by the company for utilizing alternate sources of energy ||N.A. |
|(iii) the capital investment on energy conservation equipment's ||N.A. |
(b) Technology absorption:
|(i) the efforts made towards technology absorption ||N.A |
|(ii) the benefits derived like product improvement cost reduction product development or import substitution ||N.A. |
|(iii) in case of imported technology (imported during the last three years reckoned from the beginning of the financial year) ||N.A. |
|(a) the details of technology imported ||N.A. |
|(b) the year of import; ||N.A. |
|(c) whether the technology been fully absorbed ||N.A. |
|(d) if not fully absorbed areas where absorption has not taken place and the reasons thereof ||N.A. |
|(iv) the expenditure incurred on Research and Development ||N.A. |
The efforts are being made for energy conservation to new and innovative means.Further the Company did not have any imported technology during the financial year.
22.PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES:
All Related Party Transactions those were entered during the financial year were inordinary course of the business of the company and were on arm's length basis.
All such Related Party Transactions are placed before the Audit Committee for approval.
The policy on materiality of Related Party Transactions and also on dealing withRelated Party Transactions as approved by the Audit Committee and the Board of Directorsis has been uploaded on the website of the Company at www.pratikshachemicals.in underinvestors/policy documents/Related Party Transaction Policy.
The particulars of every contract or arrangements entered into by the Company withrelated parties referred to the sub-section (1) of section 188 of the Companies Act 2013are disclosed in Form No. AOC-2 Annexure: IV'the same forms part of thisreport pursuant to Section 134 (3) (h) of the Act read with rule 8(2) of the Companies(Accounts) Rules 2014.
23.PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS UNDER SECTION 186:
In terms of provisions of Section 134(3)(g)of the Companies Act 2013 the Particularsof Loans Guarantees or Investments under Section 186 is annexed hereto as Annexure:V' and forms part of this Report.
24.PARTICULARS OF EMPLOYEES REMUNERATION:
A. The ratio of the remuneration of each director to the median employee's remunerationand other details in terms of sub-section 12 of Section 197 of the Companies Act 2013read with Rule 5(1) of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014 are forming part of this report as Annexure: VI' tothe Directors' Report.
B. The statement containing particulars of employees as required under Section
197(12) of the Companies Act 2013 read with Rule 5(2) of the Companies (Appointmentand Remuneration of Managerial Personnel) Rules 2014 is not provided as no employees ispaid remuneration of Rs. 8.50 Lac Per month if employed for part of the year and Rs. 1.02Crore Per Annum if employed for the whole year.
25.SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION PROHIBITION AND REDRESSAL) ACT2013:
Disclosure under Section 22 of the Sexual Harassment Of Women At Workplace (PreventionProhibition and Redressal) Act 2013:
Pursuant to Section 22 of the Sexual Harassment of Women at Workplace(PreventionProhibition and Redressal) Act 2013 the company has setup the Internalcomplaints committee and the said committee has framed policy for prevention of sexualharassment at work place in accordance with the section 22 of the Sexual Harassment ofWomen at Workplace (Prevention Prohibition and Redressal) Act 2013. However during theyear no complaints were received by the Internal Complaints committee for sexualharassment from any of the women employees of the company.
26. CORPORATE SOCIAL RESPONSIBILITY (CSR)
The company does not fall under the purview of the section 135 of the Companies Act2013 which requires formulating a Corporate Social Responsibility Committee and adoptingany activities as specified in Schedule VII.
27. HUMAN RESOURCES DEVELOPMENT:
Your Company treats its "Human Resources" as one of its most significantassets. The Company continues its focus on retention through employee engagementinitiatives and provides a holistic environment where employees get opportunities torealize their potential. A number of programs that provide focused people attention arecurrently underway. Your Company thrust is on the promotion of talent internally throughjob rotation and job enlargement. The Company's Health and Safety Policy commits toprovide a healthy and safe work environment to all employees.
28.CHANGE IN NATURE OF THE BUSINESS:
There has been no change in the nature of business of the company during the year underreview.
29.MANAGEMENT DISCUSSION AND ANALYSIS:
As per the corporate governance norms a separate section on Management Discussion andAnalysis outlining the business of the Company is set out in Annexure forming part of thisReport.
30.SIGNIFICANT OR MATERIAL ORDERS AGAINST COMPANY:
No significant and material orders were passed by the regulators or courts or tribunalsimpacting the going concern status and Company's operation in future.
31.SIGNIFICANT OR MATERIAL EVENT OCCURRED AFTER BALANCE SHEET DATE:
No Event has occurred after the balance sheet date that representing the materialchanges and commitment that affecting the Financial position of the company.
32.STATEMENT OF DIRECTORS' RESPONSIBILITY STATEMENT:
Pursuant to requirement under 134(3)(c) and Section 134 (5) of the Companies Act 2013(Act) Directors confirm that:
(a) in the preparation of the annual accounts for the year ended on 31stMarch 2019 the applicable accounting standards read with requirement set out underSchedule III to the Act have been followed and there are no material departures from thesame;
(b) 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 as at March 31 2019 and of the profit ofthe company for the year ended on that date;
(c) the Directors have taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of the Act for safeguarding theassets of the company and for preventing and detecting fraud and other irregularities;
(d) the Directors had prepared the annual accounts on a going concern basis;
(e) the Directors had laid down internal financial controls to be followed by thecompany and that such internal financial controls are adequate and are operatingeffectively and;
(f) The Directors had devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems are adequate and operating effectively.
Your Directors wish to place on record their gratitude and sincere appreciation for theassistance and co-operation received from the financial institutions banks Governmentauthorities customers vendors and members during the year under review.
Your Directors would like to express a profound sense of appreciation for thecommitment shown by the employees in supporting the Company in its continued robustperformance on all fronts.
|PLACE: AHMEDABAD ||BY THE ORDER OF THE BOARD OF DIRECTORS |
|DATE: 13/08/2019 ||FOR PRATIKSHA CHEMICALS LIMITED |
| ||sd/- |
| ||MR. JAYESH PATEL |
| ||DIRECTOR |
| ||(DIN:00401109) |