SEL Manufacturing Company Ltd.
Your Directors have pleasure in presenting their 19th Annual Report on the affairs ofthe company together with Audited Financial Statements for the financial year ended 31stMarch 2019.
|FINANCIAL RESULTS || ||(Rupees in Lacs) |
| ||Current Year ||Previous year |
| ||(2018-19) ||(2017-18) |
|Revenue from Operations ||45910.97 ||98927.71 |
|Other Income ||7539.42 ||4900.63 |
| ||53450.39 ||103828.34 |
|Less : || || |
|Expenditure ||49228.14 ||126889.65 |
|Depreciation & Amortization ||10883.24 ||11163.56 |
| ||60111.38 ||138053.21 |
|Profit/(loss)before exceptional items And tax: ||(6660.98) ||(34224.87) |
|Exceptional Items ||16935.56 ||132495.53 |
|Profit/(Loss) before tax: ||(23596.54) ||(166720.40) |
|Less : || || |
|Taxes : Deferred Tax ||- ||49925.94 |
|Mat Credit Entitlement ||- ||5533.60 |
| ||- ||55459.54 |
|Profit/(Loss)from continuing Operations ||(23596.54) ||(222179.94 |
|Profit/(Loss)from discontinuing Operations ||- ||- |
|Profit/(Loss) for the period ||(23596.54) ||(222179.94) |
|Other Comprehensive Income || || |
|i) Items that will not be reclassified to Profit or loss ||401.41 ||395.14 |
|ii) Items that will be reclassified to Profit or loss ||(351.90) ||(1836.05) |
|Total Comprehensive Income/(Loss)for the Period ||(23547.03) ||(223620.85) |
The Company is vertically integrated multi-product textile company manufacturingvarious kinds of Knitted Garments Terry Towels Knitted & Processed Fabric andvarious kind of Yarn with production facilities located at different parts of India.
State of Company's affairs:
During the year under review your company has achieved Revenue from Operations of Rs.45910.97 lacs as compared to Rs. 98927.71 lacs in the previous year. After deductingExpenses and Exceptional Items there was Loss of Rs. 23596.54 lacs as compared to Loss ofRs. 166720.40 lacs during the previous year. After providing for taxes and otheradjustments the current year loss stood at Rs. 23596.54 lacs as compared to loss of Rs.222179.94 lacs during the previous year.
The Company followed an aggressive growth path and had considerably grown its balancesheet including debt. Due to the industry situation in general viz. slowdown and companyspecific issues such as growing debt delayed realization of debtors working capitalshortfall delay in project completion and cash flow mismatch which had adverselyaffected the liquidity position of the company the company was facing financial problemsand finding difficulty in servicing its debt obligation. The Company had opted for CDR ofits Debt in November 2013. The CDR package was approved by the competent authority inJune 2014 and implemented by lenders in September 2014. The credit facilities envisaged& sanctioned under CDR package were not fully released by the lenders which resultedin sub-optimum utilization of manufacturing facilities and the company could not completeone of its spinning project where substantial amount was already incurred. All this hasled to adverse financial performance and erosion in net worth of the Company. Also thecompany has been facing cash flow mismatch and is not able to serve debt obligations asper the terms of CDR package sanctioned earlier. Due to financial constraints the companyhas also started job work operations in some of its spinning plants.
Since the Company was finding it difficult to serve its debt obligations the Companyhas requested its lenders for a second/deep restructuring of its debts. Considering thestate of art manufacturing facilities of the Company most modernized technology skilledlabor force professional management and inherent viability of the Company the lendershad in-principle agreed for second/deep restructuring of the debts. Pending discussionswith the lenders State Bank of India in its capacity as financial creditor has filed apetition on 12th October 2017 under "Insolvency and Bankruptcy Code 2016"(IBC) with Hon'ble National Company Law Tribunal Chandigarh Bench (NCLT). On 11th April2018 the NCLT vide it's order of even date admitted the said petition and CorporateInsolvency Resolution Process (CIRP) has been initiated. Mr. Navneet Kumar Gupta havingRegistration No.IBBI/IPA-001/IP-P00001/2016-17/10009 was appointed as Interim ResolutionProfessional (IRP) vide order dt. 25th April 2018 and the affairs business and assets tobe managed by the Interim Resolution Professional (IRP). The Company has preferred anappeal against the admission of petition and appointment of IRP with National Company LawAppellate Tribunal (NCLAT).
The Corporate Insolvency Resolution Process (CIRP) has since been kept in abeyance videorder dt. 22nd June 2018 of Hon'ble High Court of Punjab & Haryana. The matter hassince been transferred to Hon'ble Supreme Court of India and is pending for adjudication.Accordingly the Company has prepared these financial statements on the basis of goingconcern assumption.
Due to non disbursement of credit facilities the Company had suffered operationallosses as well as capital losses. Therefore the Company has presented before theAdjudicating Authority counter claim & claim of set off against the banks.
Further the secured lenders have stopped charging interest on borrowings since theaccounts of the Company have been categorized as Non Performing Asset. Further theCorporate Insolvency Resolution Process had been initiated under "Insolvency andBankruptcy Code 2016". In view of the above the Company has stopped providinginterest accrued and unpaid effective 1st April 2016 in its books. The Company had givenfinancial guarantee to the bankers of its subsidiary namely SEL Textiles Ltd. to securethe credit facilities availed by it. The said guarantee has been invoked by the bankersbefore initiation of Corporate Insolvency Resolution Process.
As at 31.03.2019 the Company has the following Subsidiary Company(ies) namely SELAviation Pvt. Ltd. SEL Textiles Ltd. Silverline Corporation Ltd. and also a subsidiaryfirm namely M/s SE Exports.
The Annual Accounts/Financial Statements of the Subsidiary companies/firms and therelated detailed information shall be made available to shareholders of the holding andsubsidiary companies seeking such information at any point of time.
Further the Annual Accounts/Financial Statements of the subsidiary companies are keptfor inspection by any shareholders in the head office i.e. the Registered Office of theholding company and of the subsidiary companies concerned.
Your company continue to hold 99% stake in the partnership firm namely M/s SE Exports.
SEL Textiles Ltd. is the wholly owned Subsidiary of the Company. SEL Textiles Ltd. isengaged in the business of textiles and the Company has two spinning unit(s) one atNeemrana (Rajasthan) and one at Hansi Hissar (Haryana) and a terry towel unit at NawaSheher Punjab Spinning unit at Vill Punjava-Lambi Tehsil Malout Dist Sri Muktsar Sahib(Punjab). Further SEL Textiles Ltd. has a subsidiary company i.e. M/s SilverlineCorporation Ltd.. SEL Aviation Pvt. Ltd. subsidiary of the company is in the business ofAviation services. The contribution of Subsidiaries in the overall performance is as givenin Consolidated Financial Statements. Further the Report on financial position ofsubsidiaries alongwith names of companies which have ceased to be its subsidiariesassociate companies etc. during the year has been duly provided as an Attachment inprescribed Form AOC1.
CONSOLIDATED FINANCIAL STATEMENTS:
The Consolidated Financial Statements of the Company and its subsidiaries prepared andpresented in accordance with Accounting Standard are attached to and form part of theAnnual Report.
The Company believes that good corporate governance is one of the vital tools indirecting and controlling the affairs of the Company in an efficient manner and helps inachieving the goal of maximizing value of Company's stakeholders in a sustained manner. Itrecognizes Transparency Integrity Honesty and Accountability as core values and themanagement believes that practice of each of these creates the right corporate culturefulfilling the purpose of Corporate Governance. However it is to be recognized thatCorporate Governance is not just a destination but a consistent journey to consolidate andenhance sustainable value creation to the company by adhering to the core values. Aseparate section on Corporate Governance and a Certificate regarding compliance ofconditions of Corporate Governance forms part of the Annual Report
Due to the losses incurred in F.Y. 2018-19 and scarcity of funds the directors havenot recommended any dividend for the Financial year 2018-19.
SHARES WITH DIFFERENTIAL RIGHTS EMPLOYEE STOCK OPTION SWEAT EUITY SHARES:
During the year the company has not issued any Equity Shares with Differential RightsEmployee Stock Options and/or Sweat Equity Shares.
During the year your Company has not accepted any fixed deposits under the provisionsof the Companies Act 2013 and the Rules made there under.
The Company has complied with applicable secretarial Standards.
DIRECTORS & KMP:
Mr. Navneet Gupta Director of the Company retires by rotation at this Annual GeneralMeeting and being eligible offer himself for re-appointment. Further the continuation ofMr. Ram Saran Saluja Director of the Company on the board of the Company is also proposedfor approval in the ensuing Annual General Meeting by Special Resolution. Furtherreappointment of Independent Directors by Special resolution is also proposed for approvalin the ensuing Annual General Meeting. Mr. Dhiraj Saluja showing his unwillingness hasnot been re-appointed as Joint Managing Director of the Company after his tenure ended.Further the re-appointment of Mr. Vinod Kumar Goyal as Executive Director of the Companyfor a further period of 3 years is put for confirmation by the members of the Company inthe ensuing Annual General Meeting. Details of appointment and terms are given in detailin the Notice for the ensuing Annual General Meeting.
LISTING WITH EXCHANGES AND LISTING FEES:
The Equity Shares of the Company are presently listed with Bombay Stock ExchangeLimited (BSE) and The National Stock Exchange of India Ltd. (NSE). Further the Company haspaid listing fees to both the exchanges (i.e. BSE and NSE) upto financial year 2019-20.The GDRs of the company are listed on Luxembourg Stock Exchange.
M/s Malhotra Manik & Associates Chartered Accountants (Firm Registration No.015848N) were appointed as Auditors of the Company for a term of five years.
A) With reference to the Auditors remarks regarding non provision of interest on NPAclassified bank borrowings the Board would like to state that the secured Lenders havestopped charging interest on borrowings since the accounts of the Company have beencategorized as Non Performing Asset. Further the Corporate Insolvency Resolution Processhas been initiated under "Insolvency and Bankruptcy Code 2016". In view of theabove the Company has stopped providing interest accrued and unpaid effective 1st April2016 in its books. The amount of such accrued and unpaid interest calculated according tothe CDR term not provided for is estimated at Rs. 53478 lakhs (Previous Year Rs. 54084lakhs) for the year ended 31st March 2019 and the same has not been considered forpreparation of the financial statements for the year ended 31st March 2019. Due to nonprovision of the interest expense net loss for the year ended 31st March 2019 is reducedby Rs. 53478 lakhs. Further the Financial Liability is reduced by Rs. 143463 lakhs andcorrespondingly the equity is increased by the same amount.
B) With reference to remark on Interest subsidy receivable the Board would like tostate that the Subsidies are to be released by Ministry of Textiles and Madhya PradeshGovernment and the Company is hopeful of receiving the same in full. Since the subsidiesare not related to current year the same does not have any impact on current year'sprofits/losses of the Company. However the reserves & surplus & current assets areoverstated to the extent.
C) With reference to remark on Impairment testing the Board would like to state thatthe Company was implementing a Spinning project which got stuck due to non-disbursement ofcredit facilities by the Banks. However post Corporate Insolvency Resolution Process(CIRP) the Company expects that the project would be completed. Therefore impairmenttesting was not conducted.
D) With reference to remark on shortfall in the carrying value of the Security theBoard would like to state that the carrying value of the security has reduced due toimpairment of advances trade receivables etc. Further inclusion of Corporate Guaranteein financial statement has increased the borrowings without corresponding increase insecurity value.
Further the report of Auditors and notes on accounts are self explanatory and do notcall for any further comments as there are no further adverse remarks/qualified opinion bythe Auditors.
Further regarding Auditors Emphasis of Matter in their Report the Board would like tostate as under; a) In respect of contingency related to "compensation payable in lieuof bank sacrifice" the outcome of which is materially uncertain and cannot bedetermined currently. Due to non disbursement of credit facilities the Company hadsuffered operational losses as well as capital losses. Therefore the Company haspresented before the Adjudicating Authority counter claim & claim of set off againstthe banks.
b) In respect of contingency related to export incentives obligation refundable inrespect of allowance for foreign trade receivable the amount of such obligation cannot bedetermined currently.
c) With reference to the Auditors remarks regarding Non confirmation of debit/creditbalances the same were not confirmed by the respective parties despite the letters/mailsin this regard been sent to them. However the management does not expect any materialchanges on account of such reconciliation/non-receipt of confirmation from parties.
d) With reference to allowance in respect of Trade Receivable and impairment loss inrespect of long outstanding Capital/Trade advances the Company has duly complied with theapplicable Accounting Standards in this regard. However the management is of the viewthat the said receivables and outstanding Capital/Advances are fullyrecoverable/adjustable.
Further with reference to material Uncertainty Related to going concern the Lenderswith the approval of CDR EG shall have the right to recompense the reliefs/sacrifices/waivers extended by respective CDR lenders as per the CDR guidelines. The recompensepayable is contingent on various factors including improved performance of the Company andmany other conditions the outcome of which is currently materially uncertain.
However the credit facilities envisaged and sanctioned under CDR package were notreleased by the lenders to the Company which resulted in sub-optimum utilization ofmanufacturing facilities. Due to non-disbursement of funds the Company could not completeone of its spinning projects where substantial amount was already incurred. All this hasled to adverse financial performance and erosion in net worth of the Company. Also thecompany has been facing cash flow mismatch and is not able to serve debt obligations asper the terms of CDR package sanctioned earlier.
Since the Company was finding it difficult to serve its debt obligations the Companyhas requested its lenders for a second/deep restructuring of its debts. Considering thestate of art manufacturing facilities of the Company most modernized technology skilledlabor force professional management and inherent viability of the Company the lendershad in-principle agreed for second/deep restructuring of the debts. Pending discussionswith the lenders State Bank of India in its capacity as financial creditor has filed apetition on 12th October 2017 under "Insolvency and Bankruptcy Code 2016"(IBC) with Hon'ble National Company Law Tribunal Chandigarh Bench (NCLT). On 11th April2018 the NCLT vide it's order of even date admitted the said petition and CorporateInsolvency Resolution Process (CIRP) has been initiated. Mr. Navneet Kumar Gupta havingRegistration No.IBBI/IPA-001/IP-P00001/2016-17/10009 was appointed as Interim ResolutionProfessional (IRP) vide order dt. 25th April 2018 and the affairs business and assets tobe managed by the Interim Resolution Professional (IRP).The Company has preferred anappeal against the admission of petition and appointment of IRP with National Company LawAppellate Tribunal (NCLAT). The Corporate Insolvency Resolution Process (CIRP) has sincebeen kept in abeyance vide order dt. 22nd June 2018 of Hon'ble High Court of Punjab &Haryana. The matter has since been transferred to Hon'ble Supreme Court of India and ispending for adjudication. Accordingly the Company has prepared these financial statementson the basis of going concern assumption.
Due to non disbursement of credit facilities the Company had suffered operationallosses as well as capital losses. Therefore the Company has presented before theAdjudicating Authority counter claim & claim of set off against the banks.
Further with reference to quantitative details for certain items of fixed assets thereare some category of assets of such minute nature that it takes time to derivequantitative details of such kind of assets.
COST AUDITORS :
In terms of the Section 148 of the Companies Act 2013 read with Companies (CostRecords and Audit) Rules 2014 the Company is required to maintain cost accountingrecords and get them audited every year and accordingly such accounts and records are madeand maintained. The Board appointed M/s. Jatin Sharma & Co. Cost Accountants as costauditors of the Company for the financial year 2019-20 at a fee of INR 77000 plusapplicable taxes and out of pocket expenses subject to the ratification of the said feesby the shareholders at the ensuing annual general meeting. The cost audit report for thefinancial year ended March 31 2019 would be filed with the Central Government. The costaudit report for the financial year ended March 31 2018 was filed on 23.10.2018 withinprescribed timelines.
NUMBER OF BOARD MEETINGS HELD DURING THE YEAR:
The Board met 8 times during the financial year 2018-19 the details of which are givenin corporate governance section.
ANNUAL EVALUATION OF THE PERFORMANCE OF THE BOARD ITS COMMITTEES AND OF INDIVIDUALDIRECTORS
The Board of Directors has evaluated the performance of the Board its Committees andthe Individual Directors as per the Nomination and Remuneration Policy. The IndependentDirectors of the Company also review the performace of Non- Independent Directors of theBoard.
DECLARATION BY INDEPENDENT DIRECTORS AS REQUIRED UNDER SECTION 149(7) OF THE COMPANIESACT 2013
All the Independent directors of the company have given their statement of declarationunder Section 149(7) of the Companies Act 2013 ("the Act") that they meet thecriteria of independence as provided in Section 149(6) of the Act and their Declarationshave been taken on record.
DEVELOPMENT AND IMPLEMENTATION OF A RISK MANAGEMENT POLICY:
The main objective of Risk Management is risk reduction and avoidance as alsoidentification of the risks faced by the business and optimize the risk managementstrategies. The Company has put in place a well-defined Risk Management framework fordrawing up implementing monitoring and reviewing the Risk Management. It controls therisks through properly defined framework.
POLICY ON DIRECTORS' APPOINTMENT REMUNERATION
The Company strives to maintainan appropriate combination of executive non-executiveand independent Directors including at least one woman Director. The Nomination &Remuneration Committee of the Company leads the process for Board appointments inaccordance with the requirements of Companies Act 2013 listing agreement/regulations andother applicable regulations or guidelines. All the Board appointments are based onmeritocracy. The potential candidates for appointment to the Board are interalia evaluatedon the basis of highest level of personal and professional ethics standing integrityvalues and character; appreciation of the Company's vision mission values; prominence inbusiness institutions or professions; professional skill knowledge and expertise;financial literacy and such other competencies and skills as may be considered necessary.
In addition to the above the candidature of an independent Director is also evaluatedin terms of the criteria for determining independence as stipulated under Companies Act2013 listing agreement/regulations and other applicable regulations or guidelines. Incase of re-appointment of Independent Directors the Board shall take into considerationthe results of the performance evaluation of the Directors and their engagement level. TheBoard of Directors of the Company has adopted a Remuneration Policy for Directors KMPsand other employees. The policy represents the overarching approach of the Company to theremuneration of Director KMPs and other employees.
LOANS GUARANTEES AND INVESTMENTS BY THE COMPANY
Details of loans guarantees and investments by the Company to other body corporates orpersons are given in Financial Statements/Notes to the financial statements.
MATERIAL AND SIGNIFICANT ORDERS PASSED BY REGULATORS & COURTS
State Bank of India in its capacity as financial creditor had filed a petition on 12thOctober 2017 under "Insolvency and Bankruptcy Code 2016" (IBC) with Hon'bleNational Company Law Tribunal Chandigarh Bench (NCLT). On 11th April 2018 the NCLT videit's order of even date admitted the said petition and Corporate Insolvency ResolutionProcess (CIRP) has been initiated. Mr. Navneet Kumar Gupta having RegistrationNo.IBBI/IPA-001/IP-P00001/2016-17/10009 was appointed as Interim Resolution Professional(IRP) vide order dt. 25th April 2018 and the affairs business and assets to be managedby the Interim Resolution Professional (IRP). The Company has preferred an appeal againstthe admission of petition and appointment of IRP with National Company Law AppellateTribunal (NCLAT).
Further the Corporate Insolvency Resolution Process (CIRP) has since been kept inabeyance vide order dt. 22nd June 2018 of Hon'ble High Court of Punjab & Haryana. Thematter has since been transferred to Hon'ble Supreme Court of India and is pending foradjudication. Accordingly the Company has prepared these financial statements on thebasis of going concern assumption.
No other significant and material orders have been passed by any regulators or courtsor tribunals against the Company impacting the going concern status and Company'soperations in future.
MATERIAL CHANGES & COMMITMENTS
Apart from the Orders of NCLT and other Court(s) Orders and State of Company's Affairsas stated earlier no material changes and commitments affecting the financial positionof the Company have occurred after the end of the financial year 2018-19 and till the dateof this report.
THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE:
Your Company has always believed in providing a safe and harassment free workplace forevery individual working in SEL through various interventions and practices. The Companyhas complied with provisions relating to the constitution of Internal Complaints Committeeunder the Sexual Harassment of Women at Workplace (Prevention Prohibition and Redressal)Act 2013. The Company always endeavors to create and provide an environment that is freefrom discrimination and harassment including sexual harassment. The Company believes inprevention of harassment of employees as well as contractors. During the year ended 31March 2019 no complaints pertaining to sexual harassment were received.
RELEVANT EXTRACT OF THE ANNUAL RETURN
The details forming part of the extract of the Annual Return in Form MGT-9 as requiredunder the provisions of the Companies Act 2013 forms an integral part of Board Report.Form MGT-9 is available on the website of the Company and can be accessed atwww.selindia.in/policy.html
Pursuant to the provisions of Section 204 of the Companies Act 2013 and the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 the Company appointedM/s P. Sharma & Co. Company Secretaries in practice to undertake the SecretarialAudit of the Company. The report of the Secretarial Audit is annexed to this report asAnnexure V.
With reference to Secretarial Auditors comments regarding not having alteast Half ofthe Board of Independent Directors as per the requirements under the SEBI (ListingObligations and Disclosure Requirements) Regulations 2015 the management has to statethat the Company is looking for appointment of Independent Director to be appointed on theBoard to fill the vacancy caused by the resignation of earlier Independent Director(s)from the Board of the Company. The Company in the current financial position is finding itdifficult as person(s) are not showing interest to be appointed as Independent Director onthe Board of the Company. Further as per SEBI (LODR) Third Amendment Regulations 2018the provisions as specified in Regulation 17 etc. of the SEBI(LODR) Regulations shall notbe applicable during the insolvency resolution process period in respect of a listedentity which is undergoing corporate insolvency resolution process under the Insolvencycode.
With reference to other comments regarding Non-submission of Financial Results in timeunder Regulation 33 (3) of the Securities and Exchange Board of India (Listing Obligationsand Disclosure Requirements) Regulations 2015 for quarter and year ended 31st March2018 the management has to state that the Exchanges were well informed in respect ofinteralia the insolvency commencement date the appointment of the IRP and the periodduring which the interim resolution professional was required not to take over managementof the Company on account of the Court orders. Accordingly it had been requested to theHon'ble Securities and Exchange Board of India ("SEBI") and Disclosure also madeto Exchanges in this regard that extension of time period be allowed for the IRP to takeon record the audited results on standalone basis and consolidated basis for the quarterand financial year ending March 31 2018 which was not acceded to by Hon'ble SEBI.
Further the "Secretarial Auditors" report is self explanatory and thereforedoes not require further comments and explanation.
RELATED PARTY TRANSACTIONS
The Board has adopted a policy to regulate the transactions of the Company with itsrelated parties. As per policy all related party transactions require approval as per theprovisions of the Companies Act 2013 and SEBI(LODR) Regulations. The said policy isavailable on the Company's website viz. www.selindia.in/policy.html
Further the Company has also formulated a policy for determining 'material'subsidiaries. The said policy is available on the Company's website viz .www.selindia.in/policy.html. Details of transactions are also given in Annexure IV to thisreport in the prescribed form.
The Company has in place a whistleblower policy to support the Code of BusinessEthics. This policy documents the Company's commitment to maintain an open workenvironment in which employees consultants and contractors are able to report instancesof unethical or undesirable conduct actual or suspected fraud or any violation ofCompany's Code of Business Ethics at a significantly senior level without fear ofintimidation or retaliation.
Individuals can also raise their concerns directly to the chairman of the AuditCommittee of the Company. Any allegations that fall within the scope of the concernsidentified are investigated and dealt with appropriately. Further during the year noindividual was denied access to the Audit Committee for reporting concerns if any. Thedetails of establishment of vigil mechanism for Directors & employees to reportgenuine concerns are available at the website of the Company viz.www.selindia.in/policy.html
INTERNAL FINANCIAL CONTROLS AND ITS ADEQUACY
SEL continuously invests in strengthening its internal control processes. The Companyhas put in place an adequate system of internal financial control commensurate with itssize and nature of business which helps in ensuring the orderly and efficient conduct ofits business. These systems provide a reasonable assurance in respect of providingfinancial and operational information complying with applicable statutes safeguarding ofassets of the Company prevention & detection of frauds accuracy & completenessof accounting records and ensuring compliance with corporate policies.
FAMILIARISATION PROGRAM FOR DIRECTORS
The Company provides an orientation and business overview to all its new Directors andIndependent directors and provides materials and briefing sessions periodically whichassists them in discharging their duties and responsibilities.
The Directors of the Company are also informed of the important developments in theCompany and Industry. Directors are fully briefed on all business related matters and newinitiatives proposed by the Company and updated on changes and developments in thedomestic & global corporate and industry scenario. The details of the familiarisationprogram for Directors is available on the website of the Company viz.www.selindia.in/policy.html
CHANGES IN CAPITAL STRUCTURE
During the year there was no change in the Capital Structure of the Company.
The Board has constituted its Audit Committee pursuant to the provisions of Section 177of the Companies Act 2013 and provisions of the SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015. The Audit Committee of the Company presently comprises ofthe following members namely Mr. Ashwani Kumar Mr. Ranjan Madaan Mrs. Paramjit Kaur andMr. Navneet Gupta. Sh. Ashwani Kumar is the chairman of the said committee.
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO:Information on conservation of energy technology absorption and foreign exchange earningsand outgo is given in Annexure-I to this report.
PARTICULARS OF EMPLOYEES:
In accordance with the provisions of Section 197(12) of the Companies Act 2013 andRule 5(2) of Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014the names and other particulars of employees are set out in the Annexure-II to this reportand forms part of this report.
DIRECTORS' RESPONSIBILITY STATEMENT:
The Directors would like to assure the Members that the financial statements for theyear under review conform in their entirety to the requirements of the Companies Act2013.
The Directors confirm that:
In the preparation of the annual accounts/financial statements the applicableaccounting standards have been followed along with proper explanation relating to materialdepartures;
Appropriate accounting policies have been selected and applied consistently andhave 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 31st March 2019 and of theprofit/loss of the Company for the year ended on 31st March 2019;
Proper and sufficient care has been taken for maintenance of adequate accountingrecords in accordance with the provisions of the Companies Act 2013 for safeguarding theassets of the Company and for preventing and detecting fraud and other irregularities;
The annual accounts/financial statements have been prepared on a going concernbasis.
That Internal financial controls were laid down to be followed by the companyand that such internal financial controls are adequate and were operating effectively.
Proper systems had been devised to ensure compliance with the provisions of allapplicable laws and that such systems were adequate and operating effectively.
CORPORATE SOCIAL RESPONSIBILITY
The Company has adopted Corporate Social Responsibility initiatives and focuses on keyareas as education healthcare etc. in accordance with the provisions of the relative Actand rules made thereunder.
The Corporate Social Responsibility Committee consists of Sh. Ranjan Madaan (Chairman)Smt. Paramjit Kaur and Sh. Ram Saran Saluja. The Board of Directors on recommendation ofthe CSR Committee has formulated the CSR policy of the Company. The CSR activities of theCompany are implemented in accordance with the core values viz. protecting stakeholderinterests proactive engagement with the local communities and striving towards inclusivedevelopment. The CSR activities are focused on the following five broad themes with goalsto improve overall socio economic indicators of Company's area of operation:
Promoting healthcare sanitation and making safe drinking water available;
Employment enhancement through training and vocational skill development;
Income enhancement through farm based and other livelihood opportunities;
Promoting education and sports; and
Ensuring sustainable environment.
The annual report on CSR containing particulars specified in Companies (CSR Policy)Rules 2014 is given in Annexure III. The CSR policy of the Company is also placed on thewebsite of the Company viz. www.selindia.in/policy.html
Your Directors express their gratitude to the Company's vendors customers BanksFinancial Institutions Shareholders & society at large for their understanding andsupport. Finally your Directors acknowledge the dedicated services rendered by allemployees of the company.
| ||For and on Behalf of the Board |
| ||For SEL MANUFACTURING COMPANY LTD. |
|PLACE : LUDHIANA ||(RAM SARAN SALUJA) |
|DATED : 03.07.2019 ||CHAIRMAN |
| ||DIN: 01145051 |