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Sueryaa Knitwear Ltd.

BSE: 540318 Sector: Industrials
NSE: N.A. ISIN Code: INE249U01013
BSE 05:30 | 01 Jan Sueryaa Knitwear Ltd
NSE 05:30 | 01 Jan Sueryaa Knitwear Ltd

Sueryaa Knitwear Ltd. (SUERYAAKNITWEAR) - Director Report

Company director report

To

The Shareholders of the Company

Your Directors are pleased to present this 24thAnnual Report together withthe Audited Annual Financial Statementsfor the year ended March 31st 2020.

COVID-19 PANDEMIC

The COVID-19 pandemic has caused a huge disruption creating an unprecedented impact onthe financial wellbeing of nations corporations and individuals. A detailed discussion onimpact of COVID-19 on the business and operations of the Company is covered in the ‘ManagementDiscussion and Analysis Report.'

CIRCULATION OF ANNUAL REPORTS IN ELECTRONIC FORM

In view of the prevailing COVID-19 situation and consequent lockdown across thecountry the Ministry of Corporate Affairs (MCA) has exempted companies from circulationof physical copies of Annual Report for FY2020.

Accordingly the Annual Report of the Company for FY2020 is being sent only by email tothe members and all other persons/entities entitled to receive the same.

This Annual Report along with other documents is also available on the Company'swebsite at https:// www.sueryaaknitwear.com

FINANCIAL HIGHLIGHTS- AT A GLANCE

• Overall Performance of your Company

• The Financial Year 2019-20 had been a little tumultuousfor the Company as yourCompany has shown a conventionalperformance during the year under review. The net Loss ofyour Company has decreasedto Rs (749423.23)in the Financial Year 2019-20 from Rs.(3974575.89)in the Financial Year 2018-19.

• The financial summary performance highlights operations/state of affair ofyourCompany for the year are summarized below:

Amount (In Rs.
PARTICULARS

Standalone

2019-20 2018-19
Income from Business Operations 4658331.00 6194958.00
Other Income - 7889.00
Total Income 4658331.00 6202847.00
Less: Expenditure 5797227.89 (10141070.94 )
Profit/Loss before Tax (1050045.39) 4268153.94
Less: Tax related to earlier year (12850.00) 9118.00
Add: Deferred Tax Asset 43496.00 (33757.00)
Net Profit/Loss after Tax (1080691.39) (4243514.94)
Earnings per share:
Basic (0.42) (1.63)
Diluted (0.42) (1.63)

DIVIDEND

No Dividend was declared for the current financial year due to loss incurred by theCompany.

RESERVES

The Board proposes no amount to transfer to the reserves as the company is runningunder loss.

SHARE CAPITAL

During the year under review the Company has not issued any shares including EquityShares Shares with Differential Voting Rights Stock Options Sweat Equity etc. TheCompany has not bought back any equity shares during the year 2019-20.

As on 31st March 2020 paid-up share capital of the Company stood at Rs.25978000/- consisting of2597800Equity Share of Rs. 10/- each.

TRANSFER OF UNCLAIMED DIVIDEND TO INVESTOR EDUCATION AND PROTECTION FUND

Since there was no unpaid/unclaimed Dividend declared or paid by the Company theprovisions of Section 125 of the Companies Act 2013 do not apply.

DEPOSITS

During the year under review the Company has not accepted any deposits in terms of section73 of the Companies Act 2013.There were no unclaimed deposits at the end of FinancialYear i.e. 31st March 2020.

SUBSIDIARY/ASSOCIATE/ JOINT VENTURES COMPANIES OF THE COMPANY

The Company is not having any Subsidiary Company/ Joint Venture/ Associate Companyduring the financial year 2019-20. A statement about Subsidiary/Joint Ventures/AssociateCompanyin Form AOC-I is not applicable.

PARTICULAR OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES UNDER SECTION 188 OF THECOMPANIES ACT 2013

In the financial year 2019-20 company hadnot entered into contracts or arrangementswith related party which are not at arm's length. Form AOC-2 is attached as Annexure-A.

EXTRACT OF ANNUAL RETURN

The details forming part of extract of Annual Return under sub section 3 of Section 92of the Companies Act 2013 in Form MGT-9 is annexed herewith as "AnnexureB.".

MANAGEMENT DISCUSSION & ANALYSIS REPORT

Management Discussion and Analysis Report for the year under review as stipulatedunder Regulation 34 of SEBI (Listing Obligations and Disclosure Requirements) Regulations2015 is presented in a separate section of this Annual Report.

CHANGE IN DIRECTORS /KEY MANAGERIAL PERSONNEL DURING THE YEAR

The details about the changes in Directors or Key Managerial Personnel by way ofAppointment Re - designation Resignation DeathDis-qualification variation made orwithdrawn etc. are as follows:

S. No. Name Designation Nature of Change With Effect From
1. Ms. Sonam Singh Company Secretary & Compliance Officer Resignation 08.06.2019
2. Mr. Dinesh Kumar Yadav Company Secretary & Compliance Officer Appointment 01.09.2019
3. Mr. Dinesh Kumar Yadav Company Secretary & Compliance Officer Resignation 10.11.2019
4. Ms. Manisha Jain Whole Time Director Resignation 23.12.2019
5. Ms. Shivani Agarwal Company Secretary & Compliance Officer Appointment 30.12.2019
6. Ms. Shivani Agarwal Company Secretary & Compliance Officer Resignation 27.01.2020

Note:Ms. Sunayana Puri was appointed as an Additional Director w.e.f. 01.07.2020.

Mr. Pramod Kumar Jaiswal resigned from the post of Director w. e. f. 24.07.2020 and Mr.Sanjay Sahni were appointed as an Additional Director (Category: Independent) w.e.f.24.07.2020.

Ms. Priyanka Ram was appointed as a Company Secretary & Compliance Officer w.e.f.25.07.2020

Mr. Rajiv Jain (DIN: 01029784) Managing Director will be retiring by rotation at theensuing Annual General Meeting and being eligible offers himself for re-appointment. TheBoard recommends his re-appointment to the Board of the Company at the ensuing AnnualGeneral Meeting.

DIRECTOR'S RESPONSIBILITY STATEMENT

In terms of Section 134(3) of the Companies Act 2013 the Directors would like tostate as follows:

(a) In the preparation of the Annual Accounts the applicable accounting standards havebeen followed along with proper explanation relating to material departures;

(b) The Directors had selected such accounting policies and applied them consistentlyand made judgments & estimates that are reasonable and prudent so as to give a true& fair view of the state of affairs of the company at the end of the financial yearand of the profit & loss of the Company for that period ;

(c) The Directors had taken proper & sufficient care for the maintenance ofadequate accounting records in accordance with the provisions of this act for safeguardingthe assets of the company and for preventing & detecting fraud & otherirregularities;

(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 such controls are adequate and are operating effectively;

(f) The Directors had devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems were adequate and operating effectively.

STATEMENT ON DECLARATION GIVEN BY INDEPENDENT DIRECTORS UNDER SECTION 149(6) OFCOMPANIES ACT 2013

All Independent Directors have given declarations under section 149(7) that they meetthe criteria of Independence as laid down under section 149(6) of the Companies Act 2013and Rules made thereunder to be read with SEBI (Listing Obligation & DisclosureRequirement) Regulation 2015.

NUMBER OF MEETINGS OF THE BOARD& COMMITTEES

The details of Board Meetings convened during the year and other details of BoardMeetings held are given in Corporate Governance Report. The maximum interval between anytwo meetings didn't exceed 120 days as prescribed in the Companies Act 2013.

AUDIT COMMITTEE

The Audit Committee of the Company is constituted in line with the provisions ofsection 177 of the Companies Act 2013 to be read with Regulation 18 of the SEBI (ListingObligation & Disclosure Requirement) Regulation 2015. The Composition of AuditCommittee is given in the Corporate Governance Report which forms the integral part ofthis Annual Report.

NOMINATION & REMUNERATION COMMITTEE

The Nomination & Remuneration Committee of the Company is constituted in line withthe provisions of section 178 of the Companies Act 2013 to be read with Regulation 19 ofthe SEBI (Listing Obligation & Disclosure Requirement) Regulation 2015. TheComposition of the Committee is given in the Corporate Governance Report which forms theintegral part of this Annual Report.

STAKEHOLDERS' RELATIONSHIP COMMITTEE

The Stakeholders' Relationship Committee of the Company is constituted in line with theprovisions of section 178 of the Companies Act 2013 to be read with Regulation 20 of theSEBI (Listing Obligation & Disclosure Requirement) Regulation 2015.The Composition ofthe Committee is given in the Corporate Governance Report which forms the integral part ofthis Annual Report.

VIGIL MECHANISM

The Vigil Mechanism policy of the Company is framed in line with the provisions ofsection 177 of the Companies Act 2013 to be read with Regulation 22 of the SEBI (ListingObligation & Disclosure Requirement) Regulation 2015 and access of the same is givento Chairperson of Audit Committee.

BOARD ANNUAL EVALUATION

The provisions ofsection 134(3)(p) of the Companies Act 2013 read with SEBI (ListingObligations & Disclosure Requirements) Regulations 2015 mandate that a Formal AnnualEvaluation is to be made by Board of its own performance and that of its Committee andindividual Directors. Schedule IV of the Companies Act 2013 states that performanceevaluation of the Independent Director shall be done by Directors excluding the Directorbeing evaluated. The Board carried out a formal annual performance evaluation as per thecriteria/framework laid down by the Nomination & Remuneration Committee of the companyand adopted by the Board. The evaluation was carried out through a structured evaluationprocess to judge the performance of individual Directors including the Chairman of theBoard. They were evaluated on parameters such as their education knowledge experienceexpertise skills behavior leadership qualities level of engagement & contributionindependence of judgment decision making ability for safeguarding the interest of theCompany stakeholders and its shareholders.

The performance evaluation of the Independent Directors was carried out by the entireBoard except the participation of concerned Independent Director whose evaluation was tobe done. The performance evaluation of the Chairman and the Non Independent Directors wascarried out by the Independent Directors. The Board was satisfied with the evaluationprocess and approved the evaluation results thereof.

STATUTORY AUDITOR& SECRETARIAL AUDITOR WITH THEIR QUALIFICATION RESERVATIONORADVERSE REMARKS ALONG WITH THE EXPLANATION OR COMMENTS BY THE DIRECTORS

A. STATUTORY AUDITOR

The members at the Annual General Meeting held on Monday 11 th September 2017appointed M/s Sandeep Manuja & Associates Chartered Accountants (Firm Reg. No.009525N) as Statutory Auditors of the Company for a period of five years to holdoffice till the conclusion of 26th Annual General Meeting of the Company. TheAuditors have resigned from their post w.e.f. 22.10.2020.

On recommendation of the Audit Committee the Board of Directors has appointed M/s.Sanjeev Bimla & Associates Chartered Accountants (Firm Reg. No. 008840N) to fillup the casual vacancy caused due to the resignation of the Auditors who shall hold officetill the date of the ensuing annual general meeting.

The Board of Directors proposes to appoint M/s. Sanjeev Bimla & AssociatesChartered Accountants

(Firm Reg. No. 008840N) as the Statutory Auditor of the Company for a consecutivefive years from the conclusion of the ensuing AGM till the conclusion of the 29thAGM of the Company.

Qualification(s) and Directors' comments on the report of Statutory Auditor:

The Notes on Accounts and observations of the Auditors in their Report on the Accountsof the Company are self-explanatory and in the opinion of the Directors do not call forany further clarification(s). Also the report submitted by the Auditor is unqualified.

B. SECRETARIAL AUDITOR

Pursuant to provision of section 204 of the Companies act 2013 read with theCompanies (Appointment and Remuneration of Managerial Personnel) Rule 2014 the Companyhas appointed M/s Ojha& Associates Company Secretaries to undertakeSecretarial Audit of the Company.

The Secretarial Audit was conducted by Mr.Tanay Ojha Company Secretaryand the report thereon is annexed herewith as "Annexure-C".

Qualification(s) and Directors' comments on the report of Secretarial Auditor:

No adverse observation(s) have been recorded by the Secretarial Auditor for the yearunder review in its report.

INTERNAL AUDIT

The Company had appointed Internal Auditor of the Company to carry out the InternalAudit Functions. The Internal Auditor submits a "Quarterly Report" to the AuditCommittee for its review.

PARTICULAR OF LOANS GUARANTEES OR INVESTMENTS UNDER SECTION 186 OF THE COMPANIES ACT2013

Particulars of loans given investments made guarantees given and securities providedalong with the purpose for which the loan or guarantee or security is proposed to beutilized by the recipient are provided in the financial statements.

All investments (if any) made during the year were within the stipulated limits of law.

MATERIAL CHANGES AND COMMITMENTS IF ANY AFFECTING THE FINANCIAL POSITION OF THECOMPANY

There were no material changes and commitments affecting the financial position of theCompany occurred between the end of the financial year of the Company to which thisfinancial statement relate and on the date of this report.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY REGULATORS OR COURTS OR TRIBUNALS IMPACTINGTHE GOING CONCERN STATUS AND COMPANY'S OPERATIONS IN FUTURE

To the best of the Management's knowledge no significant and material order(s) werepassed by any regulator(s) or courts or tribunals which could impact the going concernstatus and company's operation in future.

CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION & FOREIGN EXCHANGE EARNINGS AND OUTGO

The requisite information with regard to conservation of energy technology absorptionand foreign exchange earnings and outgoin terms of the Section 134(3)(m) of the CompaniesAct 2013 readwith Companies (Accounts) Rules 2014 is given below:

Conservation of energy
1. the steps taken or impact on conservation of energy The Company takes efforts to reduce its usage of energy and increase its production capacity.
2. the steps taken by the company for utilizing alternate sources of energy The Company hasn't taken any step towards tapping the alternate sources of energy however the management is in talks to employ other sources of energy too.
3. the capital investment on energy conservation equipment The Company hasn't made any investment assuch on energy conservation equipments however the prospects of such investment are likely in the near future.
Technology absorption
1. the efforts made towards technology absorption The Company takes efforts towards technology absorption
2. the benefits derived like product improvement cost reduction product development or import substitution NA
3. in case of imported technology (imported during the last three years reckoned from the beginning of the financial year) NA
4. the details of technology imported NA
5. the year of import NA
6. whether the technology been fully absorbed NA
7. if not fully absorbed areas where absorption has not taken place and the reasons thereof; and NA
8. the expenditure incurred on Research and Development NA
Foreign exchange earnings and Outgo
1. The Foreign Exchange earned in terms of actual inflows during the year Nil
2. The Foreign Exchange outgo during the year in terms of actual outflows Nil

RISK MANAGEMENT

The provisions of SEBI Regulations for formation of Risk Management Committee are notapplicable to the Company. However as per section 134 (3) (n) of Companies Act 2013 thecompany regularly maintains a proper check in normal course of its business regarding riskmanagement. Currently the company does not identify any element of risk which maythreaten the existence of the company.

CORPORATE SOCIAL RESPONSIBILITY INITIATIVES

The company does not fall under the criteria of net worth turnover or profit forapplicability of Corporate Social Responsibility (CSR) provisions as per Section 135 ofthe Companies Act 2013 hence the same are not applicable to the company for the periodunder review.

VIGIL MECHANISM/WHISTLE BLOWER POLICY

As per Regulation 22 of the SEBI Regulations 2015 in order to ensure that theactivities of the Company & its employees are conducted in a fair & transparentmanner by adoption of highest standards of professionalism honesty integrity and ethicalbehavior the company has adopted a vigil mechanism policy. This policy is explained in"Corporate Governance Report" and is also posted on website of the company.

PREVENTION OF SEXUAL HARASSMENT AT WORKPLACE

As per the requirement of "The Sexual Harassment of Women at Workplace(Prevention Prohibition &Redressal) Act 2013" and Rules made thereunder yourCompany has constituted Internal Complaints Committee (ICC) at its workplaces. During theyear no complaints were filed with the Company.

CORPORATE GOVERNANCE REPORT

As per Reg. 34 of SEBI Regulation 2015 to be read with Part A of Schedule V of thesaid regulations a separate section on corporate governance practices followed by thecompany together with the certificate from the company's Statutory Auditors/ PracticingCompany Secretary confirming compliance forms an integral part of this Report.

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

The Company has a robust and comprehensive Internal FinancialControl systemcommensurate with the size scale and complexityof its operation. The system encompassesthe major processes toensure reliability of financial reporting compliance withpoliciesprocedures laws and regulations safeguarding of assets andeconomical andefficient use of resources.

The Company has performed an evaluation and made anassessment of the adequacy and theeffectiveness of the Company'sInternal Financial Control System. The Statutory Auditors oftheCompany have also reviewed the Internal Financial Control systemimplemented by theCompany on the financial reporting and intheir opinion the Company has in all materialrespects adequateInternal Financial Control system over Financial Reporting andsuchControls over Financial Reporting were operatingeffectively as on 31stMarch2020 based on the internal control over financial reporting criteria established by theCompany.

The policies and procedures adopted by the Company ensuresthe orderly and efficientconduct of its business and adherenceto the company's policies prevention and detectionof frauds and errors accuracy & completeness of the records and the timelypreparationof reliable financial information.

The Internal auditors continuously monitor the efficacy of internal controls with theobjective of providing to the Audit Committee and the Board an independent objective andreasonable assurance on the adequacy and effectiveness of the organization's riskmanagement with regard to the internal control framework.

Audit committee meets regularly to review reports submitted by the Internal Auditors.The Audit Committee also meet the Company's Statutory Auditors to ascertain their views onthe financial statements including the financial reporting system and compliance toaccounting policies and procedures followed by the Company.

PERSONNEL RELATIONS

Your Directors hereby place on record their appreciation for the services rendered byexecutives staff and other 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.

PARTICULARS OF EMPLOYEES

None of the employees of your Company is in receipt of remuneration requiringdisclosure pursuantto the provisions of Section 197 read with the Companies (Appointmentand Remuneration ofManagerial Personnel) Rules 2014; hence no such particulars areannexed.

The remuneration paid to all Key Managerial Personnel was in accordance with theremuneration policy as adopted by thecompany.

REMUNERATION POLICY OF DIRECTORS AND KEY MANAGERIAL PERSONNEL

The Board on the recommendation of Nomination &Remuneration Committee framed apolicy for selection and appointment of Directors Senior Management Personnel andfixation of their remuneration thereof. The Policy contains inter-alia directors'appointment and remuneration including criteria for determining qualifications positiveattributes independence of a Director etc.

FAMILIARIZATION POLICY

Pursuant to the provisions of Regulation 25(7) of Listing Regulations 2015 the Boardhas framed a policy to familiarize Independent Directors about the Company.

LISTING AGREEMENT

The shares of the Company are presently listed at BSE Limited.

All statutory dues including Annual Listing Fees for the Financial Year 2020-21has beenpaid by the Company.

CODE OF CONDUCT

The Board of Directors has laid down the code of conduct for all Board Members andmembers of the Senior Management of the Company. Additionally all Independent Directorsof the company shall be bound by duties of Independent Directors as set out in CompaniesAct 2013 to be read with SEBI Listing Regulations 2015.

All Board Members Key Managerial Personnel and Senior Management Personnel haveaffirmed compliance with the Code of Conduct.

DISCLOSURE OF STATEMENT OF DEVIATION(S) OR VARIATION(S) UNDER REGULATION 32 OFSEBI(LISTING OBLIGATIONS AND DISCLOSURE REQUIREMENTS) REGULATIONS 2015

With reference to Regulation 32 of SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 the disclosure of Statement of Deviation(s) orVariation(s) as per the said regulation is not applicable to the Company.

ACKNOWLEDGEMENT

Your Directors wish to acknowledge their gratitude to the business Associates Bankersand Stock Exchange authorities for their continued patronage assistance and guidance.

For and on behalf of the Board
Sueryaa Knitwear Limited
Rajiv Jain Saurabh Tripati
Managing Director Director
DIN:01029784 DIN:02828108
Date:07.11.2020
Place: Ludhiana