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Tarapur Transformers Ltd.

BSE: 533203 Sector: Engineering
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OPEN 4.28
52-Week high 9.54
52-Week low 4.00
Mkt Cap.(Rs cr) 8
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 4.28
CLOSE 4.50
52-Week high 9.54
52-Week low 4.00
Mkt Cap.(Rs cr) 8
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Tarapur Transformers Ltd. (TARAPUR) - Director Report

Company director report

Dear Members

The Directors of your Company have pleasure in presenting 29th Annual Reporttogether with the Audited Accounts and Auditors’ Report for the year ended 31stMarch 2017.

1. Financial summary or highlights/ Performance of the Company (Standalone): Thefinancial performance of the Company for the Year ended 31st March 2017 is as summarizedbelow:

(Rs. In Lacs)

Particulars 2016-2017 2015-2016
Gross Turnover & Other Income 3072.69 2537.02
Profit /(Loss) before Interest Depreciation & Taxation 203.37 91.97
Less – Interest 3.62 1.12
Profit /(Loss) before Depreciation & Taxation 199.75 90.85
Less – Depreciation 183.82 195.90
Profit / (Loss) before Exceptional Items & tax 15.93 (105.05)
Less: Exceptional Item 242.38 -
Net Profit / (Loss) before Tax (226.45) (105.05)
Less– Provision for Taxation (Including Deferred Tax) - -
Net Profit / (Loss) for the year (226.45) (105.05)
Add/( less) Surplus/ (deficit) brought forward from (3102.05) (2997.00)
previous Year
Add/( less) Retain Value Assets - -
Profit available for Appropriations/( Loss) (3328.50) (3102.05)
Appropriations: - -
Balance Carried to Balance Sheet (3328.50) (3102.05)

2. Performance Review:

The Net Turnover of the Company is Rs. 2814.35 Lacs and the Company has incurred netloss of Rs. 226.45 Lacs for the F.Y 2016-17. The same is mainly due to fall in demand andrise in the prices of major raw materials and high interest rates.

3. Extract of Annual Return: Extract of Annual Return as provided undersub-section (3) of section 92 in Form No. MGT – 9. (Annexure 1).

4. Number of meetings of the Board of Directors: During the year 2016-17 4meeting of the Board of Directors held.

5. Directors’ Responsibility Statement: The Directors’Responsibility Statement referred to in clause (c) of subsection (3) of Section 134 of theCompanies Act 2013 shall state that: with proper explanation relating to materialdepartures; b) the directors had 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 profit and loss of the company for that period; c) the directorshad taken proper and sufficient care for the maintenance of adequate accounting records inaccordance with the provisions of this Act for safeguarding the assets of the company andfor preventing and detecting fraud and other irregularities; d) the directors had preparedthe annual accounts on a going concern basis; and e) the directors had devised propersystems to ensure compliance with the provisions of all applicable laws and that suchsystems were adequate and operating effectively.

6. Auditors’ Report:

As regards Auditors remarks in the Audit report comments of the Board of Directorsare as under:-

a) Auditors’ Remark:

The company has sent letters to customers in respect of trade receivables forconfirming balances outstanding as at March 31 2017 but in most of the cases thecustomers have not sent written confirmation confirming the balance outstanding as atMarch 31 2017. In the absence of confirmation any provision to be made for adversevariation in the carrying amounts of trade receivable is not quantified.

Boards Comments on the same:

The Board considers all outstanding balance of customers as on 31st March2017 are subject to provision.

b) Auditors’ Remark:

The company has sent balance confirmation letters to parties who are not covered in theregister maintained under Section 189 of the Companies Act 2013 but in most of the casesthe company have not received written Confirmation confirming the balance outstanding asat March 31 2016. Further in respect of loans granted Repayment of the principal amountwas not as stipulated and payment of interest has also not been regular. BoardsComments on the same:

Company has received balance confirmation from some of the Companies and is vigorouslyfollowing up with the rest of the borrowers. Company expects to receive balanceconfirmation from all the companies to whomsoever advances have been given. Efforts aremade to regularize arrears and recovery against overdue principal and interest

c) Auditors’ Remark:

The Company has not provided for Interest payable to Canara Bank amounting to Rs.738.50Lacs for the year ended 31st March 2017. The Company has also not made any provision forpenal interest claimed by the bank. As a result the loss for the year ended 31st March2017 is understated by Rs 738.50 Lacs & current liabilities as at 31st March 2017 arealso understated by Rs.738.50 Lacs and reserves are overstated by Rs. 738.50 Lacs.

Boards Comments on the same:

Based on the Legal advice received by the Company it has been decided not to provideany interest on liability of Canara Bank.

d) Auditors’ Remark:

The Company has not provided for interest payable to Dhanlaxmi Bank amounting toRs.31.55 Lacs. for the year ended 31st March 2017. As a result the loss for the year ended31st March 2017 is understated by Rs. 31.55 Lacs & current liabilities as at 31stMarch 2017 are also understated by Rs. 31.55 Lacs and reserves are overstated by Rs.31.55Lacs.

Boards Comments on the same:

Based on the Legal advice received by the Company it has been decided not to provideany interest on liability of Canara Bank.

e) Auditors’ Remark:

The Company has not conducted periodic physical verification of inventory at reasonableintervals.

Board Comments on the same:

Management had properly observed the inventory at regular intervals.

f) As regard Auditors’ remarks in the Annexure to their report under Item No.(vii) (a) and (b) With respect to non-payment of Central Sales Tax Sales Tax and IncomeTax the same is self explanatory.

Board Comments on the same:

The Company had paid the statutory dues though the some of the dues has been delayedbecause of financial position.

7. Loan and Investment by Company: Particulars of loans guarantees orinvestments under section 186.(Annexure 2)

8. Particulars of contracts or arrangements with related parties: Theparticulars of every contract or arrangements entered into by the Company with relatedparties referred to in sub-section (1) of section 188 of the Companies Act 2013 includingcertain arms length transactions under third proviso thereto is given in Form No. AOC-2. (Annexure3)

9. Reserves: In the financial year 2016-17 reserve maintained with theCompany is Rs. 3016.65 lacs while in year 2015-16 reserve was 3242.80 Lacs. Thisreduction is due to Loss for the year 2016-17 of Rs 226.45 Lacs.

10. Dividend: Your Directors did not recommend any dividend for the year underreview in view of losses incurred.

11. Material changes and commitments if any affecting the financial position of thecompany which have occurred between the end of the financial year of the company to whichthe financial statements relate and the date of the report: No such Material changesoccurred subsequent to closure of the financial year of the Company to which the balancesheet relates and the date of the report.

12. Conservation of energy technology absorption and foreign exchange earnings andoutgo: The details of conservation of energy technology absorption foreign exchangeearnings and outgo are as follows:

A. Conservation of energy:

i. the steps taken or impact on conservation of energy: NIL;

ii. the steps taken by the company for utilizing alternate sources of energy: NIL;

iii. the capital investment on energy conservation equipments: NIL.

B. Technology absorption:

i. the efforts made towards technology absorption: NIL;

ii. the benefits derived like product improvement cost reduction product developmentor import substitution: NIL;

iii. in case of imported technology (imported during the last three years reckoned fromthe beginning of the financial year)-

a) the details of technology imported: NIL;

b) the year of import: NIL;

c) whether the technology been fully absorbed: NIL;

d) if not fully absorbed areas where absorption has not taken place and the reasonsthereof: NIL; and

iv. the expenditure incurred on Research and Development: NIL.

C. Foreign exchange earnings and Outgo: The Foreign Exchange earned in terms ofactual inflows during the year and the Foreign Exchange outgo during the year in terms ofactual outflows: Inflow: Nil and Outflow: Rs. Nil.

13. Risk management policy: Our Company maintains conducive work environment andprovides adequate motivation to perform. However senior management team members or keypersonnel may choose to leave the organization in which case operations of our Company maybe affected. However in such eventuality we will promptly fill the vacancy through eitherfresh recruitment or internal promotion.

14. Change in the nature of business if any: No

15. Directors:

A) Changes in Directors and Key Managerial Personnel:

During the Financial year 2016-17 the following changes have occurred in theconstitution of Directors / KMP of the Company:

• Mr. Chandrashekhar Trivedi (DIN: 00135114) resigned from Directorship of theCompany w.e.f. 30.05.2016.

• Mr. Prakash Sogam was appointed as Company Secretary of the Company in the BoardMeeting held on 30.05.2016.

• Changed the designation of Mr. Suresh More (DIN: 06873425) and appointed asManaging Director of the Company w.e.f. 12.08.2016

• Pursuant to provision of section 152 of the Companies Act 2013 Mr. Suresh More(DIN: 06873425) will retire by rotation at the Annual General Meeting and being eligiblehas offered himself for re- appointment.

B) Declaration by an Independent Director(s) and re- appointment if any:

A declaration by an Independent Director that they meet the criteria of independence asprovided in Regulation 16(1)(b) of the SEBI Listing Regulations and sub-section (6) ofSection 149 of the Companies Act 2013 has been disclosed by the Independent Director tothe Company. A separate meeting of Independent Directors was conducted as per Securitiesand Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations2015 on 31st March 2017. All the independent directors were present for themeeting.

C) Formal Annual Evaluation:

The Board has formulated a code of conduct policy for formal annual evaluation purposewhich has been made by the Board of its own performance and that of its committees andindividual directors.

16. Audit Committee:

The Audit Committee has three directors i.e. one Chairman and Two members as per TheCompanies Act 2013 2/3rd of the members shall be Independent Director and Chairmanshould be Independent Director. All members of the Audit committee are independentdirector. The Chairman of Audit Committee is Mr. Lalit Laxiram Agarwal and the members ofthe committee are Mr. Suresh Sakharam More and Ms. Kiren Shrivastav.

17. Details of establishment of vigil mechanism for directors and employees:

The Whistle blower policy of the Company was formulated and policy is available in thecompany’s website

18. Nomination and Remuneration Committee:

The Company has adopted policy formulated by nomination and remuneration committee forappointment of Key Managerial personal.

19. Disclosure under the sexual harassment of women: Your Company is committed toprovide and promote safe and healthy environment to all its employees without anydiscrimination. During the year under review there was no case filed pursuant to theSexual Harassment of Women at Workplace (Prevention Prohibition and Redressal) Act 2013.

20. Managerial Remuneration:

Managerial Personnel) Rules 2014

b. There is no director who is in receipt of any commission from the company and who isa Managing Director or Whole-time Director of the Company shall receive any remunerationor commission from any Holding Company or Subsidiary Company of such Company subject toits disclosure by the Company in the Board’s Report.

c. There is no such events occurs which require disclosures in the Board ofDirector’s report under the heading "Corporate Governance" relating to thefinancial statement:

i. all elements of remuneration package such as salary benefits bonuses stockoptions pension etc. of all the directors;

ii. details of fixed component and performance linked incentives along with theperformance criteria;

iii. service contracts notice period severance fees;

iv. Stock option details if any and whether the same has been issued at adiscount as well as the period over which accrued and over which exercisable.

21. Details of Subsidiary/JV/Associate Companies: The Company has no Subsidiary/JV/ Associate Companies during the year.

22. Deposits:

A. The details relating to deposits covered under Chapter V of the Act-

a) accepted during the year: NIL;

b) remained unpaid or unclaimed as at the end of the year: NIL;

c) whether there has been any default in repayment of deposits or payment of interestthereon during the year and if so number of such cases and the total amount involved-

i. at the beginning of the year: NIL;

ii. maximum during the year: NIL;

iii. at the end of the year: NIL;

B. The details of deposits which are not in compliance with the requirements of ChapterV of the Act:: NIL;

23. Details of significant and material orders passed by the regulators or courts ortribunals impacting the going concern status and company’s operations in future: NIL

24. Auditors:

M/s. Dalal & Kala Associates Chartered Accountant Mumbai having firm registrationnumber 102017W be and is hereby appointed as the Statutory Auditor of the Company in placeof M/s. Raman S. Shah & Associates Chartered Accountants Mumbai having firmregistration number 119891W to hold office from the conclusion of this Annual GeneralMeeting(AGM) till the conclusion of Thirty Fourth Annual General Meeting (AGM) of theCompany and subject to ratification of appointment at every Annual General Meeting at suchremuneration as may be mutually agreed between the Board of Directors of the Company andthe Auditors. The Company has received a Certificate from them that their Appointment ifmade would be within the limits and that they are not disqualified for such anappointment under the Companies Act 2013. Their appointment is recommended by the board.

25. Brief description of the Company’s working during the year: The Companyhas three manufacturing units at Boiser Pali and Vadodara. However there is nomanufacturing activity carried out at Boiser & Vadodara units during the year.

26. Details in respect of adequacy of internal financial controls with reference to theFinancial Statements: The Company has adequate internal financial control withreference to the financial statement as all the works relating to financial statement isdone from the corporate office of the Company.

27. Share Capital

A) Issue of equity shares with differential rights:

No Equity Shares with differential rights were issued during the financial year 2016-17as provided in rule 4 (4) of Companies (Share Capital and Debentures) Rules 2014.

B) Issue of sweat equity shares:

No Sweat Equity Shares were issued during the financial year 2016-17 as provided inrule 8 (13) of Companies (Share Capital and Debentures) Rules 2014.

C) Issue of employee stock options:

No employee stock options were issued during the financial year 2016-17 as provided inrule 12 (9) of Companies (Share Capital and Debentures) Rules 2014.

D) Provision of money by company for purchase of its own shares by employees or bytrustees for the benefit of employees:

There is no such provision is made for the relevant financial year as provided in rule16 (4) of Companies (Share Capital and Debentures) Rules 2014.

28. Secretarial Audit Report: A Secretarial Audit Report given by M/s. BhuwneshBansal & Associates a company secretary in practice shall be annexed with the report.(Annexure4)

29. Management’s Discussion and Analysis Report:

A detailed review of the operations performance and future outlook of the Company andits businesses is given in the Management’s Discussion and Analysis Report whichforms part of this Report.(Annexure 5)

30. Corporate Governance:

We adhere to the principle of Corporate Governance mandated by the Securities andExchange Board of India (SEBI) and have implemented all the prescribed stipulations. Asrequired by Regulation 27 of SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 a detailed report on Corporate Governance forms part of this Report.The Auditors’ Certificate on compliance with Corporate Governance requirements by theCompany is attached with the Corporate Governance Report.

(Annexure 6).

31. Tax Provisions:

The Company has made adequate provisions as required under the provisions of Income TaxAct 1961 as well as other relevant laws governing taxation on the company.

32. Acknowledgement:

Your Directors would like to express their sincere appreciation for the assistance andco–operation received from the financial institutions banks Government authoritiescustomers vendors and members during the year under review. Your Directors also wish toplace on record their deep sense of appreciation for the committed services by theCompany's executives staff and workers.

On behalf of the Board of Directors
For Tarapur Transformers Limited
Suresh More
DIN: 06873425
Mumbai 30th May 2017 Chairman