The Members of
Taparia Tools Limited
Your Directors have pleasure in presenting the 51st Annual Report on theoperations of the Company together with the Audited Financial Statements for the yearended March 31 2017.
| || ||(Rs. in Lakhs) |
| ||2016-2017 ||2015-2016 |
|Revenue (Net) ||37310.05 ||33810.71 |
|Profit before interest and depreciation ||1931.16 ||2203.60 |
|Less: Interest ||130.47 ||225.66 |
|Gross Profit ||1800.69 ||1977.94 |
|Less: Depreciation ||42.32 ||44.47 |
|Profit for the year before tax ||1758.37 ||1933.47 |
|Less: Provision for taxation || || |
|Current Tax ||618.41 ||687.27 |
|Deferred Tax ||(2.14) ||(19.01) |
|Profit after tax ||1142.10 ||1265.21 |
|Add Surplus brought forward from previous year ||6287.15 ||5150.34 |
|Profit available for Appropriations ||7429.25 ||6415.55 |
|Less: Transferred to General Reserve ||114.21 ||128.40 |
|Surplus carried to || || |
|Balance Sheet ||7315.04 ||6287.15 |
The Directors have not recommended any dividend for the year under review. The Companyhas retained the funds for expansion of the activities of the Company by introducingadditional product range and purchase of Machinery & Equipment exploring new area foroperations etc.
REVIEW OF OPERATIONS
The Company's working during the year is satisfactory. The Company's total revenue (Netof excise duty) were Rs.37310.05 lakhs that represent an increase of 10.35 % over thesales of Rs.33810.71 Lakhs in the previous year. Profit earned after tax is Rs.1142.10Lakhs in the current year against Rs.1265.21 Lakhs in the previous year. However thefall in profit is due to the increase in the input cost whereas the selling pricesremained the same.
GOODS AND SERVICES TAX (GST)
The introduction of Goods and Services Tax (GST) is a very significant step in thefield of indirect tax reforms in India. By amalgamating a large number of Central andState taxes into a single tax it would mitigate cascading or double taxation in a majorway and pave the way for a common national market. The transition to GST scenario is amajor change process and the Company has established a dedicated team to evaluate theimpact analysis and carry out changes to the business process & IT systems as per theGST framework.
It has been the endeavor of your Company to follow and implement best practices inCorporate Governance in letter and spirit. A report on Corporate Governance together witha certificate from the auditors of the Company regarding compliance of conditions ofCorporate Governance as stipulated under SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 forms part of this Annual Report.
Regarding the qualification in the Auditor's Certificate for the appointment ofIndependent Director it is stated that the Company will take necessary measure to avoidsuch irregularity.
The equity shares of the company are listed on the Bombay Stock Exchange. The listingfees for the year 2017-2018 have been paid to BSE.
DEMATERIALISATION OF SHARES
Since the initiation of the dematerialization of shares of the Promoter and Promotergroup they have dematerialized 73.48% of their shareholding as on date. The Promoter andPromoter Group have not been able to dematerialise the 100% of their shareholdings due tothe technical difficulty in non-opening of a Demat account of HUF with joint holding.
During the financial year 2016-17 the Company has not accepted any deposit within themeaning of Sections 73 and 74 of the Companies Act 2013 ("the Act") readtogether with the Companies (Acceptance of Deposits) Rules 2014.
LOANS GUARANTEES AND INVESTMENT
During the financial year 2016-17 the Company has not given any guarantee for loanstaken by others from banks or other financial institutions. The Company has not taken anyTerm Loan.
HUMAN RESOURCE DEVELOPMENT
The motivated and engaging workforce which has served the company for more than fourdecades lies at the very foundation of the company's major achievements and shall wellcontinue for the years to come.
The Company has been taking honest efforts in training of individuals providing themnew and earnest opportunities in brushing developing and polishing skills that arebeneficial for the employees as well as the Organisation as a whole.
The Company's focus on retention through employee engagement initiatives and providinga holistic environment gathers opportunities for employees to realize their potential.Company's performance driven culture helps and motivates employees to excel in theirrespective areas and progress within the organization.
The company has always recognized talent and has judiciously followed the principle ofrewarding performance.
DIRECTORS AND KEY MANAGERIAL PERSONNEL
Shri D.P. Taparia and Shri Virendraa Bangur Directors of the Company retire byrotation at the ensuing Annual General Meeting and being eligible offer themselves forre-appointment. Brief profile of Shri D.P. Taparia and Shri Virendraa Bangur are given inthe Annexure-I to the Notice.
Shri Shyam Malpani resigned on July 31 2016 effective from August 1 2016 due to hispersonal reasons.
Shri Kamal Binani was co-opted on the Board as Independent Director on January 212017. He resigned on March 31 2017 due to his personal reasons.
Mrs. Premlata Purohit was co-opted on the Board as Independent Director on June 272017. She holds office as Independent Director upto the date of Annual General Meeting.
The name of Ms. Bhavna S. Shamdasani Independent Director has been changed to Mrs.Disha N. Wadhwani.
It is proposed to appoint Mrs. Premlata Purohit as Independent Director on the Board ofthe Company to hold office for 5 (Five) consecutive years for a term up to the conclusionof the 56th Annual General Meeting of the Company in the calendar year 2022. Brief profileof Mrs. Premlata Purohit is given in the Annexure-I to the Notice.
On the recommendation of the Nomination and Remuneration Committee ShriSivaramakrishnan was re-appointed as Whole time Director designated as "Director -Operations" by the Board of Directors for the period of 5(five) years from expiry ofhis present term of office i.e. with effect from November 3 2017 subject to theapproval of the shareholders.
During the year the Independent directors of the Company had no pecuniary relationshipor transactions with the Company.
DIRECTORS' RESPONSIBILITY STATEMENT
To the best of our knowledge and belief and based on the information andrepresentations received from the operating management your Directors make the followingstatements in terms of Section 134(3)(c) of the Companies Act 2013:
(a) that in the preparation of the annual accounts the applicable accounting standardshave been followed along with the proper explanation relating to material departures;
(b) that such accounting policies as mentioned in Notes to the annual accounts havebeen selected and applied consistently and judgement and estimates have been made that arereasonable and prudent so as to give a true and fair view of the state of affairs of theCompany as at 31st March 2017 and of the profit of the Company for the year ended on thatdate;
(c) that proper and sufficient care has been taken 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;
(d) that the annual accounts have been prepared on a going concern basis;
(e) that proper internal financial controls are in place and that the internalfinancial controls are adequate and are operating effectively;
(f) that proper systems to ensure compliance with the provisions of all applicable lawsare in place and that such systems are adequate and operating effectively.
INDEPENDENT DIRECTORS' DECLARATION
The Company has received necessary declaration from each of the independent directorsunder Section 149(7) of the Companies Act 2013 that he/she meets the criteria ofindependence laid down in Section 149(6) of the Companies Act 2013 and Regulation 25 ofSEBI (Listing Obligations and Disclosure Requirement) Regulations 2015.
The Board carried out an annual performance evaluation of its own performance theIndependent Directors individually as well as the evaluation of the working of theCommittees of the Board. The performance evaluation of all the Directors was carried outby the Nomination and Remuneration Committee. The performance evaluation of the Chairmanand the Non-Independent Directors was carried out by the Independent Directors.
RELATED PARTY TRANSACTIONS
There were no contracts or arrangements entered into by the company in accordance withprovisions of section 188 of the Companies Act 2013. Also there were no materiallysignificant Related Party transactions made by the Company with Promoters Directors orKey Managerial Personnel etc. which may have potential conflict with the interest of thecompany at large. The Form AOC-2 pursuant to Section 134 (3) (h) of the Companies Act2013 read with Rule 8(2) of the Companies (Accounts) Rules 2014 is set out in theAnnexure 'G' to this report.
INTERNAL CONTROL SYSTEM AND THEIR ADEQUACY
The Company has in place Internal Control Systems commensurate with the size andcomplexity of its operations to ensure proper recording of financial and operationalinformation compliance of various internal controls and other regulatory and statutorycompliance. During the year under review no material or serious observation has beenreceived from the Internal Auditors of the Company for inefficiency or inadequacy of suchcontrols.
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 in respect of employeesof the Company is annexed herewith as Annexure - 'A'.
MEETINGS OF THE BOARD
Four meetings of the Board of Directors were held during the year. For further detailsof the meetings please refer to the Corporate Governance Report which forms part of thisreport.
The composition terms of reference meetings held etc. of the Audit Committee isprovided in Corporate Governance Report which forms part of this Annual Report.
There have been no instances of non-acceptance of any recommendations of the AuditCommittee by the Board during the financial year under review.
NOMINATION AND REMUNERATION COMMITTEE
The composition terms of reference etc. of the Nomination and Remuneration Committeeis provided in Corporate Governance Report which forms part of this Annual Report.
AUDITORS AND AUDITORS' REPORT Statutory Auditors
As per the provisions of the Companies Act 2013 the period of office of M/s. Batliboi& Company Chartered Accountants Statutory Auditors of the Company expires at theconclusion of the ensuing Annual General Meeting.
It is proposed to appoint M/s. M.M. Parikh & Co. (Regd. No.107557W) CharteredAccountants as Statutory Auditors of the Company for a term of 5 (five) consecutive yearssubject to ratification by members every year. M/s. M.M. Parikh & Co. CharteredAccountants have confirmed their eligibility and qualification required under theCompanies Act 2013 for holding the office as Statutory Auditors of the Company.
There are no qualifications reservations or adverse remarks made by M/s. Batliboi andPurohit Statutory Auditors in their report for the Financial Year ended March 31 2017.
The observations and comments given in the report of the Auditors read together withnotes to accounts are self-explanatory and hence do not call for any further explanationor comments under Section 134(f)(i) of the Companies Act 2013.
Pursuant to the provisions of Section 204 of the Companies Act 2013 and the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 the Board appointed CSSagar Khandelwal Practicing Company Secretary to conduct Secretarial Audit for the F.Y.2016-2017.
Secretarial Auditors' Report
The Secretarial Audit Report for the Financial Year ended March 31 2017 is annexed asAnnexure - 'D' to the Report and Management Reply on the observations stated in theSecretarial Audit Report is annexed as Annexure - 'E.
The maintenance of cost records is not applicable to the Company as per the amendedCompanies (Cost Records and Audit) Rules 2014 prescribed by the Central Government underSection 148(1) of the Companies Act 2013.
Internal Financial Controls Audit
The Board has laid down Internal Financial Controls within the meaning of theexplanation to Section 134 (5) (e) ("IFC") of the Companies Act 2013. The Boardbelieves the Company has sound IFC commensurate with the nature and size of its business.Business is however dynamic. The Board is seized of the fact that IFC are not static andare in fact a fluid set of tools which evolve over time as the business technology andfraud environment changes in response to competition industry practices legislationregulation and current economic conditions. There will therefore be gaps in the IFC asBusiness evolves. The Company has a process in place to continuously identify such gapsand implement newer and or improved controls wherever the effect of such gaps would have amaterial effect on the Company's operations
Details of Internal Financial Control and its adequacy are included as an Annexure 'B'to the Independent Auditors' Report.
The Board of the Company has framed a risk management policy and monitors the riskmanagement plan for the Company. The Board reviews the risk management plan and ensuringits effectiveness.
CORPORATE SOCIAL RESPONSIBILITY (CSR)
In terms of section 135 and Schedule VII of the Companies Act 2013 the Board ofDirectors of the Company has constituted a CSR Committee. CSR Committee of the Board hasdeveloped a CSR Policy which is enclosed as part of this report Annexure - 'B'.Additionally the CSR Policy has been uploaded on the website of the Company atwww.tapariatools.com.
ENERGY TECHNOLOGY & FOREIGN EXCHANGE
The particulars relating to conservation of energy technology absorption foreignexchange earnings and outgo as required to be disclosed under section 134(3) (m) of theCompanies Act 2013 read with Companies (Accounts) Rules 2014 are given in the Annexure -'C' and forms part of this Report.
In pursuance to the provisions of section 177(9) & (10) of the Companies Act 2013a Vigil Mechanism for directors and employees to report genuine concerns has beenestablished. The Vigil Mechanism Policy has been uploaded on the website of the Company atwww. tapariatools.com
DISCLOSURES UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION PROHIBITIONAND REDRESSAL)
In accordance with the provisions of the Sexual Harassment of Women at Workplace(Prevention Prohibition and Redressal) Act 2013 and the Rules made there under theCompany formulated an internal policy on Sexual Harassment at Workplace (PreventionProhibition and Redressal) during the year under review.
The policy aims at educating employees on conduct that constitutes sexual harassmentways and means to prevent occurrence of any such incident and the mechanism for dealingwith such incident in the unlikely event of its occurrence. A Sexual Harassment Committeehas been constituted in accordance with the Act.
The Sexual Harassment Committee is responsible for redressal of complaints related tosexual harassment of women at the workplace in accordance with procedures regulations andguidelines provided in the Policy.
During the year under review there were no complaints referred to the Sexual HarassmentCommittee.
EXTRACT OF ANNUAL RETURN
The details forming part of the extract of the Annual Return of the company is annexedherewith as Annexure - 'F' to this report.
DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS ORTRIBUNALS IMPACTING THE GOING CONCERN STATUS AND COMPANY'S OPERATIONS IN FUTURE
There are no significant or material orders passed by the Regulators/Courts/Tribunalswhich could impact the going concern status of the Company and its future operations.
INTERIM ORDER BY SEBI
The Company has received an Interim Order from SEBI on 20/05/2015 for the allegedNon-Compliance of the Minimum Public Shareholding. The Company is of the view that therehas been no violation with reference to Promoter Shareholding. The said stand of theCompany has been intimated to SEBI vide Company's letter dated 14/10/2015.
Company has subsequently applied for Settlement Order by filing "ConsentApplication" with SEBI on 02/11/2016 in order to avoid prolonged litigation. Sincethe demand draft submitted with the Consent Application has become outdated the ConsentApplication had to be re-submitted with new demand draft and the activity was completed on02/08/2017.
As directed in the Order Company has regularly submitted compliance reports onquarterly basis to BSE.
There were no material changes and commitments affecting the financial positionof your Company between end of the financial year and the date of this report.
Your Company has not issued any equity shares or shares with differential votingrights during the financial year.
Your Company did not issue any sweat equity shares debentures or bonds duringthe year.
Your Directors express their sincere appreciation for the cooperation and assistance ofCentral and State Government authorities bankers customers suppliers and businessassociates. Your Directors also wish to place on record their deep sense of appreciationfor the committed services by your Company's employees. Your Directors acknowledge withgratitude the encouragement and support extended by our valued shareholders.
| ||For and on behalf of the Board of Directors |
| ||H.N. Taparia |
| ||Chairman & |
|Mumbai 11th August 2017 ||Managing Director |
Annexure C to the Board's Report
Information as per Section 134(3)(m) of the Companies Act 2013 read with Companies(Accounts) Rules 2014 and forming part of Directors' Report for the year ended March 312017
A) CONSERVATION OF ENERGY
i) The steps taken or impact on conservation of energy
Energy conservation continues to receive priority attention at all levels. All effortsare made to conserve and optimise use of energy with continuous monitoring improvement inmaintenance and distribution systems and through improved operational techniques like:
By maintaining the Power factor.
By scheduling of working hours and adjusting the paid holidays the Company hasmanaged to save Rs.1.50 Lakhs as against the total electricity bill.
ii) The steps taken by the company for utilising alternate sources of energy
a) Installed voltage stabilizer to each power transformer to reduce power transformerlosses.
b) The Company is in process to explore the use of solar water heater by which Companywill be able to save upto Rs.6000/- per month against the total electricity bill.
iii) The capital investment on energy conservation equipments : Nil
B) TECHNOLOGY ABSORPTION
i) The efforts made towards technology absorption
Updation of Technology is a Continuous process absorption implemented and adapted bythe Company for innovation. Efforts are continuously made to develop new productsrequired.
The Major achievement by the Company due to their continuous Research and Developmentactivities is indigenization of tooling improvements in the manufacturing processes andoperation procedures and development of new products.
The following new products have been introduced during the year 2016-2017
- New range in Combination Spanners
- New range in C-Clamp
- Cut off Wheel
- Wood Cutting Blade
- Plastic Tool Box & Organizer
- New range in Side Cutting Pliers
- Cantilever Tool Box
ii) The benefits derived like product improvement cost reduction product developmentor import substitution:
1. Energy Conservation
2. Conservation of natural resources
3. Utilization of waste and environment conservation
4. Improvement in equipment efficiency and productivity
5. Cost reduction
iii) Information regarding Technology Imported during last 3 years
iv) The expenditure incurred on Research and Development
|a) Capital ||: - |
|b) Recurring ||: Rs.151.18 Lakhs |
|c) Total ||: Rs.151.18 Lakhs |
|d) Total R and D Expenditure as a % of total turnover ||0.41% |
C) Foreign Exchange earnings and outgo
|Foreign exchange earnings ||: Rs.239.95 Lakhs |
|Foreign exchange outgo ||: Rs.22.76 Lakhs |