Spenta International Limited
Your Directors have great pleasure in presenting 34th Annual Report alongwith the Audited Balance Sheet and Profit and Loss Account for the year ended 31stMarch 2021.
1. Financial Results
The Company's performance during the year ended 31st March 2021 as comparedto the previous financial year is summarized below:
(Rs. in Lacs)
|Particulars ||FY 2020-2021 ||FY 2019-2020 |
|Total Income (including Other Income) ||2285.73 ||3654.42 |
|Gross Profit (before Interest Depreciation and tax) ||108.01 ||447.46 |
|Less: Interest ||158.02 ||169.26 |
|: Depreciation ||109.46 ||114.41 |
|: Provision for taxation - Current ||- ||40.00 |
|- Deferred ||-0.20 ||4.62 |
|Net Profit after tax ||-159.27 ||119.17 |
|Less: Other Comprehensive Income ||-2.05 ||-4.58 |
|Total Comprehensive Income for the period ||-161.32 ||114.59 |
2. Dividend and Transfer to Reserves
Your Directors have not declared any Dividend for the year under review due to lossesincurred in the year on account of ongoing pandemic and macroeconomic environment.
No amount is being transferred to reserves during the year under review.
3. Future Prospects
Company is in the process of optimising production on all the existing machines bymanufacturing optimal product mix. Using better quality yarns and doing product innovationby using different finishes which will enhance the overall quality and help to improveour margins.
4. The Change in the Nature of Business if any
There was no change in the nature of business of the Company during the year underreview.
5. Material changes and commitments affecting the Financial position of theCompany:
There were no material changes and commitments affecting the financial position of theCompany between the end of the financial year of the Company to which the financialstatements relate and the date of the report.
6. Directors and Key Managerial Personnel
During period under review following changes took place in the Board Composition.
Mr. Sashikant Newatia was appointed as a Non-Executive Independent Director w.e.f. 17thJuly 2020. Mrs. Sunita Misri was appointed as an Independent Director for a second termof five consecutive years w.e.f. 28th August 2020.
Mr. Danny Hansotia Managing Director was re-appointed as the Managing Director for aterm of 3 consecutive years w.e.f. 1st December 2020.
Mr. Nitesh Pangle was appointed as the Company Secretary and Compliance Officer of theCompany w.e.f. 2nd July 2020 he ceased to be the Company Secretary andCompliance Officer of the Company w.e.f 12th November 2020 on account ofresignation.
Subsequently Ms. Iram Fatima Shaikh was appointed as the Company Secretary andCompliance Officer of the Company w.e.f. 13th November 2020.
7. Cash Flow and Consolidated Financial Statements
As required under Regulation 34 of the Listing Regulations a Cash Flow Statement andStandalone Financial Statements is part of the Annual Report.
8. Transfer of Unclaimed Dividend to Investor Education and Protection Fund
There was no transfer during the year to the Investor Education and Protection Fund interms of Section 125 of the Companies Act 2013.
9. Number of Board Meetings
During the financial year under review the Board had met Seven times on 30thJune 2020 2nd July 2020 17th July 2020 28th August2020 14th September 2020 12th November 2020 and 12thFebruary 2021.
The intervening gap between the meetings was within the period prescribed under theCompanies Act 2013 and SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015.
10. Attributes Qualifications & Independence of Directors their appointment andremuneration
The Nomination & Remuneration Committee of Directors have approved a Policy forSelection Appointment and Remuneration of Directors which inter-alia requires thatcomposition and remuneration is reasonable and sufficient to attract retain and motivateDirectors KMP and senior management employees and the Directors appointed shall be ofhigh integrity with relevant expertise and experience so as to have diverse Board and thePolicy also lays down the positive attributes/criteria while recommending the candidaturefor the appointment as Director.
The NRC has formulated the criteria for determining qualifications positive attributesand independence of Directors in terms of provisions of Section 178(3) of the Act and theSEBI Listing Regulations. The relevant information has been given in Annexure Dwhich forms part of this Report. The policy on Company's Remuneration and Nomination isposted on Company's website at www.spentasocks.com and also annexed hereto as AnnexureE.
During the year under review no Independent Director of the Company had resigned. Mr.Sashikant Newatia was appointed as Independent Director with effect from 17thJuly 2020 and Mrs. Sunita Misri was appointed as Independent Director with effect from 28thAugust 2020.
11. Declaration of Independent Directors
The Independent Directors have submitted their disclosures to the Board that theyfulfill all the requirements as stipulated in Section 149(7) of the Companies Act 2013and Regulation 25(8) of the SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 so as to qualify themselves to be appointed as Independent Directorsunder the provisions of the Companies Act 2013 and the relevant rules.
12. Meeting of Independent Directors
The Independent Directors met once during the year on 12th February 2021 toreview the working of the Company its Board and Committees. The meeting decided on theprocess of evaluation of the Board and Audit Committee. It designed the questionnaire onlimited parameters and completed the evaluation of the Board by Non-Executive Directorsand of the Audit committee by other members of the Board. The same was compiled byIndependent authority and informed to the members.
13. Familiarization Programme for Independent Directors
The familiarization program aims to provide Independent Directors with the industryscenario the socio-economic environment in which the Company operates the businessmodel the operational and financial performance of the Company significant developmentsso as to enable them to take well informed decisions in a timely manner. Thefamiliarization program also seeks to update the Directors on the roles responsibilitiesrights and duties under the Act and other statutes. The policy on Company'sfamiliarization program for Independent Directors is posted on Company's website athttp://www.spentasocks.com/
14. Internal Control System
The Company's internal controls system has been established on values of integrity andoperational excellence and it supports the vision of the Company "To be the mostsustainable and competitive Company in our industry". The Company's internal controlsystems are commensurate with the nature of its business and the size and complexity ofits operations. These are routinely tested and certified by Statutory as well as InternalAuditors and their significant audit observations and follow up actions thereon arereported to the Audit Committee on a quarterly basis specifying the nature value andterms and conditions of the transactions.
15. Directors Responsibility Statement
The Board of Directors hereby confirms:
i) That in the preparation of the annual accounts the applicable accounting standardhad been followed along with proper explanation relating to material departures.
ii) That the Directors have selected such accounting policies and applied themconsistently and made judgments and estimates that are reasonable and prudent so as togive a true and fair view of the state of affairs of the company at the end of thefinancial year and of the Loss of the Company for that period.
iii) That the Directors have taken proper and sufficient care for the maintenances ofadequate accounting records in accordance with the provision of this Act for safeguardingthe assets of the Company and for preventing and detecting fraud and other irregularities.
iv) That the Directors have prepared the Annual accounts on a going concern basis.
v) That the Directors had laid down internal financial controls to be followed by thecompany and that such internal financial controls are adequate and were operatingeffectively.
vi) That the Directors had devised proper systems to ensure compliance with theprovisions of all applicable laws and that such systems were adequate and operating.
16. Subsidiaries and Associate Companies
The Company does not have any subsidiaries and associate companies as on 31stMarch 2021.
Your Company did not accept any deposits from the public during the year. There are nodeposits which have not been claimed by depositors or paid by the Company after the dateon which the deposit became due for repayment or renewal as the case may be according tothe contract with the depositors & there are no total amounts due to the depositors& remaining unclaimed or unpaid.
a) Internal Auditors
As per section 138 of the Companies Act 2013 the Company has appointed M/s. B. G.Dolar & Co. Internal Auditors for the year 2020-2021 to conduct the internal auditand to ensure adequacy of the Internal controls adherence to Company's policies andensure statutory and other compliance through periodical checks and internal audit.
b) Statutory Auditors
The Company at its 32rd Annual General Meeting held on 30th September 2019appointed M/s. A K Kocchar & Associates Chartered Accountants (FRN: 120410W)appointed as Statutory Auditors of the Company for a period of five consecutive years andwho shall hold such office from the conclusion of 32nd Annual General Meetingtill the conclusion of 37th Annual General Meeting at such remuneration as maybe mutually decided by the auditors and the Board of Directors thereof. Further theratification of their appointment pursuant to Section 139 of the Companies Act 2013 isnot required in terms of notification no. SO 1833(E) dated 7th May 2018 issuedby the Ministry of Corporate Affairs and accordingly the item has not been included inthe Ordinary Course of Business of this AGM Notice Further they have confirmed that theyare not disqualified as auditors of the Company under the Companies Act 2013 theChartered Accountants Act 1949 and the rules or regulations made thereunder.
Auditors' report is self-explanatory and therefore does not require further commentsand explanation.
c) Secretarial Auditors
The Board has appointed HS Associates Practicing Company Secretaries as theSecretarial Auditor of the Company for the financial year 2021-2022.
The secretarial Audit report (MR-3) of M/s. HS Associates for the period 2020-21 isannexed herewith as
d) Cost Auditors
As per Section 148 read with Companies (Audit & Auditors) Rules applicable to costauditors the company was not liable to appoint Cost auditors for the financial year2020-21.
19. Comments of the Board on Auditors' Report
a) Observations of Statutory Auditors on Accounts for the year ended 31stMarch 2021: There are no qualifications reservations or adverse remarks ordisclaimer made by the Statutory Auditors in respect of financial statements as on and forthe year ended 31st March 2021.
b) Observations of Secretarial Audit Report for the year ended 31st March2021:
Provisions of Section 204 read with Section 134(3) of the Companies Act 2013 mandatesto obtain Secretarial Audit Report from a Practicing Company Secretary. M/s. HSAssociates Practicing Company Secretaries were appointed to conduct Secretarial Audit andissue Report for the financial year 2020-21.
Secretarial Audit Report issued by M/s. HS Associates Practicing Company Secretariesin Form MR-3 for the financial year 2020-21 forms part of this report. The SecretarialAudit Report is annexed herewith as Annexure - F.
In respect of the observations made in the Secretarial Audit report following are theexplanations and comments offered by the Board.
a) During the period 1st April 2020 to 1st July 2020 there wasno Company Secretary pursuant to Section 203 of the Companies Act 2013 Read with Rule 8of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014.Therefore in terms of Reg 6(1) of SEBI (LODR) 2015 for the Period from 1stApril 2020 to 1st July 2020 the Compliance Officer of the Company was not aqualified Company Secretary in Whole Time Employment.
Boards Reply: The Board approved the appointment of Mr. Nitesh Pangle(ACS No. 60555) as Company Secretary and Compliance officer of the Company w.e.f 2ndJuly 2020 who subsequently resigned from the office of Company Secretary and Complianceofficer of the Company w.e.f the close of business hours of 12th November2020. Thereafter the Board approved the appointment of Ms. Iram Fatima Shaikh (ACS No.58968) as Company Secretary and Compliance officer of the Company w.e.f 13thNovember 2020. Further The Company received mail from BSE vide. SEBI CircularSEBI/HO/CFD/CMD/CIR/P/2020/12 dated January 22 2020. (Erstwhile SEBI circularSEBI/HO/CFD/CMD/CIR/P/2018/77 dated May 03 2018) directing the Company to pay a penaltyof Rs. 108560 (including GST @18%) for late / non-compliance of Regulation 6(1) of SEBI(Listing Obligations and Disclosure Requirements) Regulations 2015. The
Company made representation for waiver of fine before the "Committee for ReviewingRepresentations for Waiver of Fines Levied under Standard Operating Procedure (SOP)".Subsequent to which the committee approved the Company's request and waived off the finevide its mail dated June 24 2021;
b) During the period under review the Composition of Nomination and RemunerationCommittee of the Company was not as per Regulation 19(1)(b) of SEBI (LODR) Regulations2015.
Board's Reply: The Board Appointed Mr. Sashikant N. Newatia (DIN:08793440) as Independent Director w.e.f 17th July 2020 to comply with thenecessary provision. Further The Company received mail from BSE vide. SEBI CircularSEBI/HO/CFD/CMD/CIR/P/2020/12 dated January 22 2020. (Erstwhile SEBI circularSEBI/HO/CFD/CMD/CIR/P/2018/77 dated May 03 2018) directing the Company to pay a penaltyof Rs. 214760 (including GST @18%) for late / non-compliance of Regulation (1) of SEBI(Listing Obligations and Disclosure Requirements) Regulations 2015. The Company maderepresentation for waiver of fine before the "Committee for Reviewing Representationsfor Waiver of Fines Levied under Standard Operating Procedure (SOP)". Subsequent towhich the committee approved the Company's request and waived off the fine vide its maildated June 23 2021; c) Mrs. Anita Prashant Koti Chairperson of Audit CommitteeNomination and Remuneration Committee and Stakeholders Relationship Committee was notpresent for the 33rd Annual General Meeting of the Company in pursuance ofRegulation 18(1)(d) 19(3) and 20(3) of SEBI (Listing Obligation and DisclosureRequirements) Regulations 2015
Board's Reply: Since Mrs. Anita Koti was suffering from COVID she haddelegated Mr. Sashikant Newatia Non Executive Independent Director to attend on herbehalf.
20. Whistle Blower Policy/Vigil Mechanism Policy for the Directors and Employees
The Board of Directors of the Company has pursuant to the provisions of Section 177(9)of the Companies Act
2013 read with Rule 7 of the Companies (Meetings of Board and its Powers) Rules 2014framed " Whistle Blower Policy" for Directors and employees of the Company toprovide a mechanism which ensures adequate safeguards to employees and Directors from anyvictimization on raising of concerns of any violations of legal or regulatoryrequirements incorrect or misrepresentation of any financial statements and reports etc.
The employees of the Company have the right/option to report their concern/grievance tothe Chairman of the Audit Committee.
The said Policy is available on the website of the Company athttp://www.spentasocks.com/
The Company is committed to adhere to the highest standards of ethical moral and legalconduct of business operations.
21. Reporting of Fraud by Auditors
During the year under review the Statutory Auditors and Secretarial Auditor have notreported any instances of frauds committed in the Company by its Officers or Employees tothe Audit Committee under section 143(12) of the Act details of which needs to bementioned in this Report.
22. Extract of Annual Return
Pursuant to the provisions of Section 134(3) (a) and Section 92(3) of the CompaniesAct 2013 read with Rule 12 of the Companies (Management and Administration) Rules 2014the Annual Return of the Company as at March 31 2021 is uploaded on the website of theCompany and can be accessed at http://www.spentasocks.com/
23. Particulars of Contracts or Arrangements made with Related Parties
The particulars of contracts or arrangements with related parties referred to inSection 188(1) as prescribed in Form AOC - 2 of the rules prescribed under Chapter IXrelating to Accounts of Companies under the Companies Act 2013 is appended as AnnexureB.
All Related Party Transactions are presented to the Audit Committee and the Board.Omnibus approval is obtained for the transactions which are foreseen and repetitive innature. A statement of all related party transactions is presented before the AuditCommittee on a quarterly basis specifying the nature value and terms and conditions ofthe transactions.
The Related Party Transactions Policy as approved by the Board is uploaded on theCompany's website at www.spentasocks.com.
24. Particulars of Loans Guarantees or Investments made under section 186 of theCompanies Act 2013
Details of Loans granted Guarantees given or Investments made during the year underreview covered under the provisions of Section 186 of the Companies Act 2013 are givenin the notes to the Financial Statements.
25. Conservation of Energy Technology & Foreign Exchange
Information on conservation of energy technology absorption foreign exchange earningsand out go is required to be given pursuant to provision of Section 134 of the CompaniesAct 2013 read with Rule 8 of the Companies (Accounts) Rules 2014 is annexed heretomarked as Annexure-A and forms part of this report.
26. Corporate Governance Report
Report on Corporate Governance and Certificate of Practicing Company Secretaryregarding compliance of the Conditions of Corporate Governance as stipulated in regulation17 to 27 and clauses (b) to (i) of sub-regulation (2) of regulation 46 of SEBI (ListingObligations and Disclosure Requirements) Regulations 2015 with the Stock Exchanges areenclosed as a separate section and forms part of this report marked as Annexure H.
27. Particulars of Employees
The information pursuant to Section 197(12) of the Act read with Rule 5 (1) of theCompanies (Appointment and
Remuneration of Managerial Personnel) Rules 2014 relating to median employee'sremuneration is annexed hereto marked as Annexure-C and forms part of this report.
28. Management's Discussion and Analysis Report
The Management's Discussion and Analysis Report for the year under review asstipulated under regulation 34 (3) and Part B of schedule V of the SEBI (ListingObligation and Disclosure Requirement) Regulation 2015 is annexed hereto marked Annexure-Gand forms part of this report.
29. Compliance of applicable Secretarial Standards
Your Directors hereby confirm that the Company has complied with the necessaryprovisions of the revised Secretarial Standard 1 and Secretarial Standard 2 to the extentapplicable to the Company.
30. Risk Management Policy
The Company has in place a mechanism to identify assess monitor and mitigate variousrisks to key business objectives and thus in pursuance of the same it has formulated aRisk Management Policy to ensure compliance with regulation 17 of SEBI (ListingObligations and Disclosure Requirements) Regulations 2015. Major risks identified by thebusinesses and functions are systematically addressed and also discussed at the meetingsof the Audit Committee and the Board of Directors of the Company.
The Company's internal control systems are commensurate with the nature of its businessand the size and complexity of its operations. Significant audit observations and followup actions thereon are reported to the Audit Committee and the risk management policy isavailable on the website of the company: www.spentasocks.com.
31. The details of Significant and Material Orders passed by the Regulators or Courtsor Tribunals impacting the going concern status and Company's operations in future
During the year there has been no significant material orders passed by the Regulatorsor Courts or Tribunals impacting the going concern status and company's operations infuture.
32. Enhancing Shareholder Value
Your company firmly believes that its success the marketplace and a good reputationare among the primary determinants of value to the shareholder. The organizational visionis founded on the principles of good governance and delivering leading-edge productsbacked with dependable after sales services.
33. Cautionary Statement
Statements in the Board's Report and the Management Discussion & Analysisdescribing the Company's objectives expectations or forecasts may be forward lookingwithin the meaning of applicable securities laws and regulations. Actual results maydiffer materially from those expressed in the statement. Important factors that couldinfluence the Company's operation include global and domestic demand and supply conditionsaffecting selling prices of Raw Materials Finished Goods input availability and priceschanges in government regulations tax laws economic developments within and outside thecountry and various other factors. The current Covid 19 pandemic has also affected theoperations of the Company.
The Management's Discussion and Analysis Report for the year under review asstipulated under regulation 34 (3) and Part B of schedule V of the SEBI (ListingObligation and Disclosure Requirement) Regulation 2015 is annexed to this report. (AnnexureG)
34. Annual Evaluation of the performance of the Board its Committees and of IndividualDirectors has been made
During the year the Board adopted a formal mechanism for evaluating its performanceand as well as that of its Committees and individual Directors including the Chairman ofthe Board. The exercise was carried out through a structured evaluation process coveringvarious aspects of the Boards functioning such as composition of the Board &committees experience & competencies performance of specific duties &obligations governance issues etc. Separate exercise was carried out to evaluate theperformance of individual Directors including the Board Chairman who were evaluated onparameters such as attendance contribution at the meetings and otherwise independentjudgment safeguarding of minority shareholders interest etc.
The evaluation of the Independent Directors was carried out by the entire Board andthat of the Chairman and the Non-Independent Directors were carried out by the IndependentDirectors.
The Directors were satisfied with the evaluation results which reflected the overallengagement of the Board and its Committees with the Company.
35. Committees of the Board
During the year in accordance with the Companies Act 2013 the Board re-constitutedsome of its Committees. There are currently three Committees of the Board as follows:
Nomination and Remuneration Committee
Stakeholders' Relationship Committee
36. Disclosure under the Sexual Harassment Of Women At Workplace (PreventionProhibition And Redressal) Act 2013
As required by the Sexual Harassment of Women at Workplace (Prevention Prohibition& Redressal) Act 2013 the Company has formulated and implemented a policy onprevention of sexual harassment at workplace with a mechanism of lodging complaintsredressal for the benefits of its employees. The Company has also constituted an InternalComplaints Committee/Anti-Sexual Harassment Committee as required under the SexualHarassment of Women at Workplace (Prevention Prohibition and Redressal) Act 2013.Currently there are 10 women employees' working with the Company and a senior womenemployee has been designated to receive complaints and report such cases to theAnti-Sexual Harassment Committee in this behalf. During the year under review nocomplaints were received under The Sexual Harassment of Women at Workplace (PreventionProhibition and Redressal) Act 2013.
37. Other Disclosures
The company does not have any Employees Stock Option Scheme in force and henceparticulars are not furnished as the same are not applicable.
No application has been made under Insolvency and Bankruptcy Code: hence requirement todisclose the details of application made or any proceedings pending under the Insolvencyand Bankruptcy Code 2016 (31 of 2016) during the year along with their status as at theend of the Financial Year is not applicable to the Company.
The requirement to disclose the details of difference between amount of valuation doneat the time of onetime settlement and valuation done while taking loan from the Banks andFinancial Institutions along with the reasons thereof is also not applicable.
Your Directors wish to place on record their appreciation of the support which theCompany has received from its promoters lenders business associates includingdistributors vendors and customers the press and the employees of the Company.
| ||By order of the Board |
| ||For Spenta International Limited |
| ||Sd/- |
| ||Sanjay Gadodia |
|Date August 13 2021 ||(Chairman) |
|Place- Palghar ||DIN: 00203433 |