SBEC Systems (India) Limited
Your Directors take pleasure in presenting the 28th Annual Report of the Companytogether with the Audited Accounts for the year ended 31st March 2017.
The Summarised Financial Results of the Company for the Financial Year 2016-17Vis-a-Vis 2015-16 are as under:
| || ||(Rs. in Lacs) |
|Particulars ||Period ended 31.03.2017 ||Period ended 31.03.2016 |
|Sales & Other Income ||14.94 ||1.82 |
|Total Expenditure ||26.45 ||63.28 |
|Operating Profit/(Loss) before Tax ||(11.51) ||(61.45) |
|Profit/(Loss) After Tax ||(11.51) ||(61.25) |
During the year under review the revenue from other income stood at Rs. 14.94 Lacs.The net loss of the Company stood at Rs. 11.51 Lacs as compared to net loss of Rs. 61.25Lacs for the previous year.
DIVIDEND & RESERVES
In view of the losses incurred your Board is unable to recommend any dividend for thefinancial year ended March 31 2017.
The Company has not transferred any amount to the reserves for the year ended March 312017.
The paid up equity capital as on March 31 2017 was Rs.10.00 Lacs. During the yearunder review the Company has not issued shares with differential voting rights norgranted stock options nor sweat equity.
ASSOCIATE/SUBSIDIARY/JOINT VENTURE COMPANY
As on March 31st 2017 the Company has one Associate Company i.e. SBEC Sugar Limited.Investment in the Associate is dealt with in accordance with Accounting Standard (AS) 23the consolidation of accounts of the Company with its associate are combined by using"Equity Method".
Further a statement containing the salient features of the financialstatements of theAssociate company are prescribed in AOC-1 and appended as Annexure-A to the Board'sReport.
There is no subsidiary company within the meaning of Section 2(87) of the CompaniesAct 2013 ("Act").
CONSOLIDATED FINANCIAL STATEMENTS
The Consolidated Financial Statements of the Company for the financial period 2016-17are prepared in compliance with applicable provisions of the Companies Act 2013Accounting Standards and SEBI (LODR) Regulations 2015.
DIRECTOR'S RESPONSIBILITY STATEMENT:
Pursuant to the provisions contained in Section 134 (5) of the Companies Act 2013your Directors to the best of their knowledge and belief and according to information andexplanations obtained from the management confirm that:
- in the preparation of the annual accounts for the financial year ended March 312017 the applicable accounting standards have been followed and there are no materialdepartures from the same;
- 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 as at March 31 2017 and of the loss ofthe Company for the year ended on that date;
- the Directors have taken proper and sufficient care 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;
- The Directors have prepared the Annual Accounts on a going concern basis;
- The Directors have laid down proper internal financial controlsto be followed by theCompany and such controls are adequate and operating effectively and
- The Directors have devised proper systems to ensure compliance with the provisions ofall applicable laws and that such systems are adequate and operating effectively.
There was no change in the composition of the Board of Directors of the Company duringthe financial year 2016-17.
In accordance with the provisions of Section 152 of the Companies Act 2013 andArticles of Association of the Company Mr. Jagan Nath Khurana (DIN 0003817)Non-Executive Director of the Company retires by rotation at the ensuing Annual GeneralMeeting and being eligible offer himself for re-appointment.
KEY MANAGERIAL PERSONNEL (KMP)
During the financial period ended 31.03.2017 following persons are Whole Time KeyManagerial Personnel (KMP) of the Company in terms of provisions of Section 203 of theCompanies Act 2013.
|S.No.Name ||Designation |
|1. Mr. Shiv Shanker Agarwal ||Chief Executive Officer |
|2. Mr. Anil Jain ||Chief Financial Officer |
|3. Ms. Akanksha Sharma ||Company Secretary |
The Board met Four times during the financial year 2016-17 the details of which aregiven in the Corporate Governance Report. The intervening gap between the Meetings waswithin the period prescribed under the Companies Act 2013.
COMMITTEES OF THE BOARD
During the year in accordance with the Companies Act 2013 the Board has re-constitutedsome of its Committees and presently the Company has following
- Audit Committee
- Nomination and Remuneration Committee
- Stakeholders Relationship Committee
The details of all the Committees along with their composition terms of reference andmeetings held during the year are provided in the "Report on CorporateGovernance" forming part of this Annual Report.
POLICY ON DIRECTOR'S APPOINTMENT & REMUNERATION AND OTHER DETAILS
The Board on recommendation of the Nomination & Remuneration Committee has frameda policy on Directors' appointment and remuneration including criteria fordeterminingqualificationspositive attributes independence of a Director and othermatters specified under said section. The policy is available on the website of theCompany www.sbecsystems.com.
As required under Section 134(3)(p) of the Companies Act 2013 and Regulation 17 ofSEBI (Listing Obligations and Disclosures Requirements) Regulations 2015 the Board ofDirectors had already approved the evaluation criteria for evaluating the performance ofthe Board of Directors its Committees namely Audit Committee Stakeholders RelationshipCommittee and Nomination and Remuneration Committee the Directors individually and theperformance of Independent Directors.
The manner in which the evaluation was carried out and the process adopted has beenmentioned in the Corporate Governance Report.
STATEMENT ON DECLARATION GIVEN BY THE INDEPENDENT DIRECTORS
As required under Section 149 (7) of the Companies Act 2013 all the IndependentDirectors have given declarations that they meet the criteria of independence as specifiedin Section 149 (6) of the Companies Act 2013 and SEBI (LODR) Regulations 2015.
As per provisions of Section 139(2) Companies Act 2013 ("the Act") read withrules made thereunder no listed Company shall re-appoint the existing auditor's firm whohas completed two terms of five consecutive years as auditor in the same company. Atransition period of three years from the commencement of the Act is provided to appoint anew auditor.
Accordingly as per the said requirements of the Act M/s. Doogar & Associates areproposed to be appointed as Statutory Auditors of the Company in place of the existingStatutory Auditors M/s. K.K. Jain & Co. Chartered Accountants to hold Office fromthe conclusion of the ensuing Annual General Meeting till the conclusion of the ThirtyThird Annual General Meeting subject to ratification by members every year as may beapplicable.
As required under the provisions of Section 139 of the Companies Act 2013 the Companyhas received a written consent from the auditors to their appointment and a certificate tothe effect that their appointment if made would be in accordance with the Companies Act2013 and the rules framed there under and that they have satisfied the criteria providedin Section 141 of the CompaniesAct 2013.
STATUTORY AUDITORS REPORT
The Statutory Audit Report contains qualifications and the Company has given itscomments on Audit Qualified Opinion for the Financial Year 2016-17 the details arementioned below:
Response to Qualified Opinion
Non reversal of diminution of current quoted investment it is hereby clarified thatthe company is holding 14231214 Equity Shares of SBEC Sugar Limited and the Company isnot intending to sale/ transfer/ otherwise dispose off these shares the management hasdecided not to make any provision of diminution or reversal thereof.
The Statutory Auditors have not reported any incident of fraud to the Audit Committeeof the Company during the year under review.
Pursuant to the provisions of Section 204 of the Companies Act 2013 read with theCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014 the Companyhas appointed M/s R.K. Singhal & Associates Company Secretaries in practice as theSecretarial Auditor to undertake the Secretarial Audit of the Company. The Report of theSecretarial Audit is given in Annexure-B to this Report.
The observation in secretarial audit report are self-explanatory and therefore not callfor any further explanation.
RISK MANAGEMENT POLICY
As required under Section 134(n) of the Companies Act2013 the Company has laid downthe policy on risk management stating therein the objectives and purpose of the saidpolicy.
The Risk Management Policy of the Company can be viewed on the Company's websitewww.sbecsystems.com.
INTERNAL FINANACIAL CONTROLS
The Company has adequate Internal Financial Controls with proper checks to ensure thattransactions are properly authorised recorded and reported apart from safeguarding itsassets. These systems are reviewed and improved on a regular basis. It has a comprehensivebudgetary control system to monitor revenue and expenditure against approved budget on anongoing basis. The internal auditors of the Company reviews the controls across the keyprocesses and submits reports periodically to the Management and significant observationsare also presented to the Audit Committee for review. Follow up mechanism is in monitorthe implementation of the various recommendations.
CORPORATE SOCIAL RESPONSIBILITY (CSR) INITIATIVES.
Section 134 read with Section 135 of the Companies Act 2013 provides the thresholdlimit for applicability of the CSR to a Company i.e. (a) net worth of the Company to beRs. 500 crore or more; or (b) turnover of the company to be Rs. 1000 crore or more; or(c) net profit of the company to be Rs.5 crore or more. As the Company does not fall underany of the threshold limits given above the provisions of Section 135 are not applicableto the Company.
RELATED PARTY TRANSACTIONS
As required under Section 188 of Companies Act 2013 and Regulation 23 of SEBI (ListingObligations and Disclosures Requirements) Regulations2015 the Company places before theAudit Committee related parties transaction. The Audit Committee accords its omnibusapproval for such related party transactions on annual basis. The updates on thetransactions with the related parties are placed before the Audit Committee on a quarterlybasis. The details are also places before the Board of Directors for its information.
All contracts/arrangements/transactions entered into during the financial year with therelated parties were on arm's length basis and were in the ordinary course of business.
There are no materially significant related party transactions with the promotersDirectors Key Managerial Personnel or other designated persons which may have a potentialconflict with the interest of the Company at large.
As required under Regulation 23 of SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 the Company has formulated a policy on related partytransactions and the same was approved by the Audit Committee and the Board of Directors.The said policy has been uploaded at the investors section of the Company's website atwww.sbecsystems.com.
The details of contracts/arrangements with related parties as required to be disclosedin Form-AOC-2 is not applicable on the Company.
In terms of Chapter IV Regulation 15 Read with Schedule II of the SEBI (ListingObligations and Disclosure Requirements) Regulations 2015 a Corporate Governance Reportis made part of this Annual Report.
Company Secretaries in practice Acertificate regarding compliance of the conditionsstipulated for Corporate Governance as required under Part E of Schedule V read withRegulation 34(3) of the SEBI (Listing Obligations and Disclosure Requirements)Regulations2015 is attached to the Corporate Governance Report.
The declaration by the Chief Executive Officer and Chief Financial Officer addressed tothe Members of the Company pursuant to Clause D of Schedule V Read with Regulation 34(3)and Chapter IV of the SEBI (Listing Obligations and Disclosure Requirements) Regulations2015 regarding adherence to the Code of Conduct by the Members of the Board and by theMembers of the Senior Management Personnel of the Company is also attached to theCorporate Governance report.
The report also contains the details as required to be provided on Board evaluationremuneration policy whistle blower policy/vigil mechanism etc.
MANAGEMENT DISCUSSION AND ANALYSIS
The Management Discussion and Analysis Report for the year under review as stipulatedunder Clause B of Schedule V of SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 of the Listing Regulations form part of this Annual Report.
VIGIL MECHANISM & WHISTLE BLOWER POLICY
The Company has a vigil mechanism and a whistle blower policy. The same has been postedon the Company's website and the details of the same are given in the Corporate GovernanceReport.
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO
The information relating to conservation of energy technology absorption and foreignexchange earnings and outgo pursuant to Section 134(3)(m) of the Companies Act 2013 readwith Rule 8 of the Companies (Accounts) Rules 2014 is given in Annexure-C to thisReport.
PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS
During the financial year 2016-17 the Company has not made any investment nor givenany loans or guarantees covered under the provisions of section 186 of the Companies Act2013.
PARTICULARS OF EMPLOYEES
The information required pursuant to Section 197 read with Rule 5 of the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 relating to the ratioof the Remuneration of each Director to the median employees remuneration shall not applybecause none of the Directors has drawn any remuneration from the Company for thefinancial year 2016-17. In terms of the Provisions of Section 197(12) of the CompaniesAct 2013 read with Rule 5(2) &(3) of the Companies Appointment & Remuneration ofManagerial Personnel) Rules 2014. None of the employees of the Company were in receipt ofremuneration of more than limit specified as set out in the above said Rules.
EXTRACT OF THE ANNUAL RETURN
The details of the extract of the Annual Return in Form MGT-9 as per the provisions ofSection 92 of the Companies Act 2013 read with rule 12 of the Companies (Management andAdministration) Rules 2014 is annexed herewith and marked as Annexure-D to thisReport.
During the year under review your Company did not accept any deposits within themeaning of provisions of Chapter V Acceptance of Deposits by Companies of the CompaniesAct 2013 read with the Companies (Acceptance of Deposits) Rules 2014.
LISTING WITH STOCK EXCHANGES
The Equity Shares of the Company are listed with BSE Limited. The annual fee for theBombay Stock Exchange have been paid promptly for the year 2016- 2017.
SUSPENSION OF SHARES
The Equity shares of the Company are presently lying suspended on the Bombay StockExchange due to penal reasons. They were last quoted on the Bombay Stock exchange on 6thSeptember 2001 at Rs. 2.30 per share.
The Company has received an In-Principal approval for revocation of suspension intrading of equity shares from The Bombay Stock Exchange vide letter no.LIST/COMP/KK/260/2017-18 dated July 03 2017 in furtherance to this the Company is inprocess for revocation of suspension of trading.
Your directors hereby place on record their appreciation for the services rendered bythe executives staff and workers of the Company for their hard work dedication andcommitment. During the year under review relations between the employees and themanagement continued to remain cordial.
Your directors thank the various Central and State Government Authorities and Agenciesfor the continued help and cooperation extended by them. The Directors gratefullyacknowledge all stakeholders of the Company viz. customers members dealers vendors andbanks for their excellent support during the year. The Directors also place on recordtheir sincere appreciation to all employees of the Company for their unstinted commitmentand continued cooperation to the Company.
| ||For & behalf of the Board |
| ||for SBEC Systems (India) Limited |
| ||Sd/- |
| ||Vijay Kumar Modi |
|Place: New Delhi ||Chairman |
|Date: 25-08-2017 ||DIN: 00004606 |