Your Directors are pleased to present the Forty Fourth Annual Report on business andoperations of your Company together with the Audited Financial Statements along with theReport of the Auditors for the financial year ended 31st March 2017.
COMPANY'S STANDALONE FINANCIAL RESULTS
The Financial performance of the Company for the year ended 31st March 2017is summarized below: (Rs. in Lakhs)
|PARTICULARS ||2016-17 ||2015-16 |
|Income from Operations ||4793.52 ||5881.82 |
|Other Operating Income ||173.07 ||147.4 |
|Total Income from Operations ||4966.59 ||6029.22 |
|Total Expenditure (excluding depreciation) ||4784.74 ||5753.28 |
|Profit before depreciation ||181.85 ||275.95 |
|Depreciation ||(8.67) ||(12.87) |
|Profit/(Loss) Before Tax and exceptional items ||173.18 ||263.07 |
|Exceptional Item ||- ||3.72 |
|Profit/Loss Before Tax ||173.18 ||266.79 |
|Less: Provision for Taxation || || |
|- Current ||30.50 ||95.00 |
|- Deferred ||(0.30) ||1.02 |
|- Earlier year ||39.37 ||19.17 |
|- MAT Credit ||- ||- |
|Profit After Tax ||103.61 ||151.60 |
|Add: Surplus bought Forward ||815.10 ||663.50 |
|Add: Less Adjustment as per Schedule II as per Note 27(B) (11) ||- ||- |
|Balance carried to Balance Sheet ||918.72 ||815.10 |
During the year under review your Company had issued and allotted 4150000 (Forty OneLakh Fifty Thousand) warrants convertible into 4150000 (Forty One Lakh Fifty Thousand)equity shares of Rs. 10/- (Rupees Ten) each at a conversion price of Rs. 27.20/- (RupeesTwenty Seven and Twenty paise) per share (including premium of Re. 17.20/- (RupeesSeventeen and Twenty Paise each) per equity share on a preferential basis convertiblewithin a period of 18 months from the date of allotment of warrants aggregating to Rs.112880000 (Rupees Eleven Crores Twenty Eight Lakhs Eighty Thousand) to public category.The said warrants were issued and allotted at a price as determined through SEBIGuidelines. Your Company has only one class of Equity Shares and it has neither issuedshares with differential rights as to dividend voting or otherwise nor issued shares(including sweat equity shares) to the employees or Directors of the Company under anyScheme.
Your Directors are reinvesting the earnings into the business of the Company for thefurther growth and long-term interests of the Company. No dividend has therefore beenrecommended for the year ended 31st March 2017.
During the year under review income from operations was Rs. 4793.52 lakhs as againstRs. 5881.82 Lakhs in the previous year. Your Company's performance in the currentFinancial Year in terms of Total Income stood at Rs. 4966.59 Lakhs as compared toRs.6029.22 Lakhs in the previous year. The profit before tax for the year ended 31stMarch 2017 is Rs. 173.18 lakhs as against Rs. 266.79 lakhs for the previous year. Duringthe year under review there was a failure in the process flow at the Company's plantlocated at Dheku which had resulted in the spoilage of material and contamination ofstock. Preliminary assessment had been conducted and it was found that there may be asignificant loss to the Company on account of such spoilage and contamination of material.The Company is assessing and taking steps for loss reduction and the intimation of losswill be submitted once the final assessment is completed. This material event may haveadverse impact on the Company's financial performance.
Your Company has not accepted any deposits within the meaning of Section 73 of theCompanies Act 2013 and the Companies (Acceptance of Deposits) Rules 2014 and no amounton account of principal or interest on public deposits was outstanding as on the date ofthe balance sheet.
DIRECTOR'S RESPONSIBILITY STATEMENT:
In terms of provisions of Section 134(3)(c) and Section 134(5) of the Act the Board ofDirectors of Tirupati Industries (India) Limited to the best of their knowledge andability in respect of the financial year ended March 31 2017 confirm that:
a) in the preparation of the Annual Accounts for the financial year ended 31st March2017 the applicable accounting standards have been followed. There are no materialdepartures from the applicable accounting standards;
b) the Directors have selected such accounting policies and applied them consistentlyand 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 at the end of the financial year and ofthe profit of the Company for that period
c) the Directors have taken proper and sufficient care 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) the Directors have prepared Annual Accounts on a going concern basis;
e) the Directors have laid down internal financial controls to be followed by theCompany and that such internal financial controls are adequate and are operatingeffectively; and
f) the Directors have devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems are adequate and operating effectively.
INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY:
The Audit Committee regularly review internal controls and operating systems andprocedures for efficiency and effectiveness. The internal Auditors' Reports are regularlyreviewed by the Audit Committee of the Board. Your Company's internal controlsystems are commensurate with the nature and size of its business operations.
In accordance with the provisions of the Companies Act 2013 Mr. R. Sanghvi Directorof the Company retires by rotation and being eligible offers himself for re-appointment atthe ensuing Annual General Meeting. In terms of provisions of the Companies Act 2013 theexisting Independent Directors were appointed as the Independent Directors for a term upto 31st March 2019 at the Annual General Meeting held on 29thSeptember 2014. Mr. N. R. Thanage was appointed as an Additional Director (Executive) inthe meeting of Board of Directors of the Company held on 19th October 2016. Mr.Ketan Karani was appointed as an Additional Director on the Board w.e.f 17thDecember 2017.
Mr. Hitesh Jhaveri resigned as Managing Director of the Company w.e.f 17thDecember 2016. The Board wishes to place on record its deep appreciation for thesignificant contributions made by him to the Management of affairs of the Company and forhis guidance to the Company during his tenure with the Company. Dr. Ms. Anjali Parasnisresigned as Independent Director w.e.f 26th October 2016. The Board places onrecord its appreciation for the services rendered by her during her tenure with theCompany.
DECLARATION BY INDEPENDENT DIRECTORS:
All Independent Directors of the Company have given declarations that they meet thecriteria of independence as laid down under Section 149(6) of the Act and Regulation16(1)(b) of the SEBI Listing Regulations 2015. In the opinion of the Board they fulfillthe conditions of independence as specified in the Act and the Rules made there under andare independent of the management.
The Act states that formal annual evaluation needs to be carried out by the Board ofits own performance and that of its committees and individual directors. Schedule IV (Codefor Independent Directors) of the Act states that the performance evaluation ofIndependent Directors shall be done by the entire Board of Directors excluding theDirector being evaluated. Your Company had carried out an annual evaluation of performanceof its Board and its Committees and individual Directors. The Board evaluated theeffectiveness of its functioning and that of the Committees and of individual directors byseeking their inputs on various aspects of Board/Committee Governance. The aspects coveredin the evaluation included the contribution to and monitoring of corporate governancepractices participation in the long term strategic planning and the fulfillment ofDirector's obligations and fiduciary responsibilities. Further the Independent Directorsat their meeting reviewed the performance of Board including the Chairman of the Board andNon-Independent Directors of the Board.
NOMINATION & REMUNERATION COMMITTEE:
The Board has on the recommendation of the Nomination & Remuneration Committeeframed a policy for selection and appointment of Directors Senior Management and theirremuneration. The Remuneration Policy is stated in the Corporate Governance Report.
NUMBER OF BOARD MEETINGS:
The Board of Directors met 11 (Eleven) times during 2016-17 details and attendance ofDirectors provided in the Corporate Governance Report.
BOARD COMMITTEES: The Board of Directors has the following Committees:
|1. Audit Committee ||2. Stakeholders' Relationship Committee ||3. Nomination and Remuneration Committee |
POLICIES OF THE COMPANY:
Your Company has posted the following policy documents on its websitewww.tirupatiind.com
|1. Whistle Blower Policy ||5) Policy on Materiality |
|2) Code of Conduct for the Board Members & Senior Management of the Company. ||6) Preservation of Documents policy |
|3. Familiarization Programme For Independent Directors ||7) Records and Archives Management Policy |
|4) Code of Internal Procedures and Code of Conduct for prevention of Insider Trading. ||8) Anti-Sexual Harassment Policy |
RELATED PARTY TRANSACTIONS:
All related party transactions made during the financial year 2016-17 were on arm'slength basis and were in the ordinary course of business. All Related Party Transactionsare placed before the Audit Committee as also the Board for approval. A statement of allrelated party transactions is presented before the Audit Committee on quarterly basisspecifying the nature value and terms and conditions of transactions. The details ofRelated party transactions are provided in the accompanying financial statements. Sinceall related party transactions entered into by the Company were in ordinary course ofbusiness and were on an arms length's basis Form AOC 2 is not applicable toCompany.
PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS:
The details of the loans guarantees or investments given or made by the Company ascovered under the provisions of Section 186 of the Companies Act 2013 are given in thenotes to the financial statements.
POLICY ON SEXUAL HARASSMENT OF WOMEN AT WORKPLACE:
The Company has zero tolerance towards sexual harassment at the workplace and towardsthis end has adopted Anti Sexual Harassment Policy in line with the provisions of SexualHarassment of Women at Workplace (Prevention Prohibition and Redressal) Act 2013 and theRules thereunder. The Policy aims to provide protection to employees at the workplace andprevent and redress complaints of sexual harassment and for matters connected orincidental thereto. All employees (permanent contractual temporary trainees) arecovered under the said policy. An Internal Complaints Committee has also been set up toredress complaints received on sexual harassment. The Company has not received anycomplaint of sexual harassment during the Financial Year 2016-17.
A detailed Report on Corporate Governance pursuant to the requirements of SEBI ListingRegulations forms part of the Annual Report. A Certificate from the Practising CompanySecretary confirming compliance with the conditions of Corporate Governance as stipulatedunder the aforesaid Schedule V (E) of SEBI Listing Regulations also forms part of theAnnual Report. The Business Responsibility Reporting as required by Regulation 34(2) ofthe SEBI Listing Regulations 2015 is not applicable to your Company for the FinancialYear ending March 31 2017
MANAGEMENT DISCUSSION AND ANALYSIS:
Pursuant to Regulation 34 read with Schedule V of the SEBI Listing Regulations 2015detailed review of operations performance and future outlook of the Company is coveredunder a separate Annexure to this report as Management's Discussion & Analysis.
EXTRACT OF ANNUAL RETURN:
The details forming part of the extract of the Annual Return in Form MGT-9 as requiredunder Section 92 of the Companies Act 2013 are annexed herewith as"Annexure-A".
SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS:
The Copmany's bankers had approached Hon'ble High Court Mumbai to pursue anapplication to wind up the Company. This order of liquidation has been kept in abeyancetill the Company pays the amount to the Bankers on a timely basis. In case the Companycommits any defalut in payment as per the agreed terms the Bank may proceed to reactivatethe proceedings to liquidate the Company.
FAMILIARISATION PROGRAMME FOR INDEPENDENT DIRECTORS:
The Chairman and Managing Director have one to one discussion with all directors tofamiliarize them with the Company's operations. Further the Company has put in place asystem to familiarize the independent directors about the Company its products businessand on-going events relating to the Company. The details of such familiarizationprogrammes for Independent Directors are posted on the website of the Company(www.tirupatiind.com).
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO:
Particulars required u/s. 134 of the Companies Act 2013 read with Companies (Accounts)Rules relating to conservation of energy research & development technologyabsorption foreign exchange earnings and outgo are given in the Annexure-B to thisReport.
BUSINESS RISK MANAGEMENT:
During the year under review the Company has identified and evaluates elements ofbusiness risk. Business risk inter-alia includes Fluctuations in Foreign Exchange RawMaterial Procurement Risk Environmental & Safety Risk Working Capital Risk MarketRisk and Business Operations Risk. The risk management framework defines the riskmanagement approach of the Company and includes periodic review of such risk. The Board ofDirectors and senior management team currently assess the operations and operatingenvironment to identify potential risks and take necessary mitigation actions.
VIGIL MECHANISM / WHISTLE BLOWER POLICY:
The Company has a vigil mechanism named Whistle Blower Policy to deal with instance offraud and mismanagement if any. The details of the said Policy is explained in theCorporate Governance Report and also posted on the website of the Company(www.tirupatiind.com).
As on 31st March 2017 the Company does not have any Subsidiary Company.Also there are no associate companies or joint venture companies within the meaning ofSection 2(6) of the Act.
COMMENTS ON AUDITORS REPORT:
In respect to the qualification made by the Auditor in the Auditor's Report theManagement of the Company makes the following clarifications:
(i) The Company's Banker Citibank had initiated action against the Company for recoveryof its dues in the opinion of the Company the method adopted by the Bank for recoveriesis not as per prescribed legal norms and guidelines of RBI for Small and MediumEnterprises. To put an end to uncertainties both parties had arrived at an amicableresolution by filing consent terms before the Hon'ble High Court Mumbai. As per theconsent terms the Company was supposed to pay certain amounts to Bank by selling part orfull of its properties to reduce its debt burden which could not happen in the prescribedperiod. The Company is in the process of negotiating with potential buyers for the sale ofits properties and expects a positive result in near future. The Company is holdingdiscussions with the Bank to extend the period of payments for its dues.
(ii) Company had appointed debt collection agency for recovery of its foreignoutstanding recovery of which may take a long time. Management is in the process ofrenewing agreement of Debt Collection Agency and also taking appropriate action in thematter for debt recovery.
(iii) Company has adequate controls (internal and otherwise) and continues the processof review at regular intervals.
(iv) The Company had invested Rs. 209.25 lakhs in an Unlisted Company and out of thisinvestment; the present investment at cost is Rs. 40.00 lakhs. It is pertinent to mentionthat the investment fetched a gross profit of Rs. 203.35 lakhs to the Company in past fewyears. Hence the Company has already benefited by gaining more than 100% gross return onits investment in the Unlisted Company.
PARTICULARS OF EMPLOYEES:
The statement containing particulars of employees as required under Section 197(12) ofthe Companies Act 2013 read with rule 5(2) of the Companies (Appointment and Remunerationof Managerial Personnel) Rules 2014 is given in an annexure and forms part of this AnnualReport. In terms of Section 136(1) of the Companies Act 2013 the Report and the Accountsare being sent to the Members excluding the aforesaid Annexure. Any Member interested inobtaining a copy of the Annexure may write to the Company Secretary at the RegisteredOffice of the Company. Disclosures pertaining to remuneration and other details asrequired under Section 197(12) of the Companies Act 2013 and Rule 5(1) of the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 are annexed to thisReport.
SAFETY HEALTH AND ENVIRONMENT:
Your Company is committed to ensure sound Safety Health and Environmental (SHE)performance relating to its activities products and services. The Company is takingcontinuous steps and also developing Environment friendly processes for effective resourcemanagement with specific focus to energy water and basic raw materials. Monitoring andperiodic review of the designed SHE Management System is done on a continuous basis.
AUDITORS AND AUDITORS' REPORT:
At the Annual General Meeting held on 30th September 2016 M/s MAYRA &KHATRI Chartered Accountants were appointed as Statutory Auditors of the Company to holdoffice till the conclusion of 48th (Forty Eight) Annual General Meeting. Interms of the provisions of the Companies Act 2013 it is necessary to get the appointmentratified by the shareholders in every Annual General Meeting until the expiry of originalappointment. In this regard the Company has received a certificate from the Auditors tothe effect that if they are reappointed it would be in accordance with the provisions ofSection 141 of the Companies Act 2013. The Auditors' Report is enclosed with theFinancial Statements in this Annual Report.
The Board had appointed Mr. Ravindra V. Joshi Practising Company Secretary to conductSecretarial Audit for the financial year 2016-17. The Secretarial Audit Report for thefinancial year ended March 31 2017 is annexed herewith marked as Annexure C to thisReport. The Secretarial Audit Report does not contain any qualification reservation oradverse remark.
The Ministry of Corporate Affairs notified the Secretarial Standard on Meetings of theBoard of Directors (SS 1) and Secretarial Standard on General Meetings (SS 2) effective from July 1 2015. Your Company complies with the same. Your Companywill comply with the other Secretarial Standards issued by the Institute of CompanySecretaries of India (ICSI) as and when they are made mandatory.
Your Company recognizes its Human Resources as one of its prime & criticalresources. The relations between the Management and the staff members remained verycordial throughout the year under review.
Your Company has taken the initiative of going green and minimising the impact on theenvironment. The Company has been circulating the copy of the Annual Report in electronicformat to all those Members whose email addresses are available with the Company. YourCompany appeals other Members also to register themselves for receiving Annual Report inelectronic form.
ACKNOWLEDGEMENT: Your Directors place on record their appreciation to Company'sesteemed clients vendors investors business associates and bankers for their continuoussupport to the Company.
Your Directors also place on record their appreciation for the contribution made by theemployees at all levels but for whose hard work and support your Company's achievementswould not have been possible.
|Dated: 30th May 2017 ||By order of the Board of Directors |
|42-45 Emerald Industrial Estate ||TIRUPATI INDUSTRIES (INDIA) LIMITED |
|Dheku Tal Khalapur ||Sd/- |
|Dist- Raigad Maharashtra India. ||(Ramesh J. Sanghvi) |
| ||Chairman |