Your Directors are pleased to present the 34th Annual Report and thecompany's audited financial statement for the financial year ended March 31 2019.
The standalone financial results of your Company for the financial year ended March 312019 are summarized below:
(Amount in Rs.)
|Particulars ||Year ended March 31 2019 ||Year ended March 31 2018 |
|Income from operations ||3839300 ||21626238 |
|Other Income ||8201410 ||7497459 |
|Total Expenditure ||8785705 ||29739980 |
|Depreciation ||- ||- |
|Profit before Tax ||3255005 ||(616083) |
|Provision for Taxes || || |
|Current ||1568343 ||- |
|Deferred ||(714036) ||35630 |
|Profit (Loss) after Taxes ||2400699 ||(651913) |
|Other Comprehensive Income || || |
|-item that will not be classified to Profit & loss || || |
|Re-measurement gains/(loss) on defined benefit plan ||31760 ||(20300) |
|Income tax relating to above ||(9528) ||- |
|Equity Instruments through Other Comprehensive ||12717662 ||98131650 |
|Income ||(2543532) ||(19626330) |
|Income tax relating to above || || |
|Other Comprehensive Income net after tax ||10196362 ||78485020 |
|Total Comprehensive Income For the period ||12597061 ||77833107 |
With view to conserve resources of the Company the Board of Directors of the Companyhavenot recommended any dividend for the year 2018-19.
The company's present paid up capital stands at Rs. 61320000 comprising of 6132000equity shares of Rs. 10/- each.
During the year under review the revenue registered a decrease from Rs.21626238 inlast year to Rs.3839300 in current year. The existing business has been effected byadverse conditions prevailing in the market. The Company imports yarn from China as wellas purchases from importers and sells it in local market. The Company is getting most ofits yarn air spliced which makes its knots less. This is value addition for the Company'sproduct to be well accepted in local market. Company's Total Comprehensive Incomeregistered a decrease from Rs.77833108 in last year to Rs.12597061 in current year.Yarn & Thread will be the thrust areas of business for the Company in the comingyears.
The Company's Yarn and thread products are very well accepted due to the ISOcertification quality improvement and timely delivery policy. The Company hasconcentrated on its goals of consolidating and strengthening its marketing networkdelivering quality products and cutting cost wherever possible.
Various organizational development initiatives were undertaken during the year. Theseare expected to help create a robust organization based on strong values uniform andsystematic business processes and people empowerment.
The Management Discussion and Analysis Report deals with the operations of your Companyin detail and forms part of this Annual Report.
Your directors are hopeful of better results for the company in the current year.
There has been loss during the year under review due to adverse market conditions. Yourdirectors are hopeful of better results for the company in the current year.
During the year under review the Company has not accepted any deposits falling withinthe meaning of Section 73 of the Companies Act 2013 and the Companies (Acceptance orDeposits) Rules 2014.
PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS:
During the financial year under review the Company has not given any Loan Guaranteesor made any Investments covered under the provisions of Section 186 of the Companies Act2013.
INTERNAL FINANCIAL CONTROLSYSTEMS AND THEIR ADEQUACY:
The company has an internal control System commensurate with the size scale andcomplexity of its operations. The internal Audit functions report to the Chairman of theAudit Committee and to Chairman and Managing Director of the Company.
The Internal Audit monitors and evaluates the efficiency and adequacy of internalcontrol systems in the company and compliances with operating systems accountingprocedure and policies at all locations of the Company.
AMOUNTS PROPOSED TO BE CARRIED TO RESERVES:
Particulars of the amounts proposed to be carried to reserves have been covered underNote to the financial statements of the Company.
The audited financial statement of the Company prepared in accordance with theCompanies Act 2013 and relevant Accounting Standards (AS) issued by the Institute ofChartered Accountants of India forms part of this Annual Report. The Compliance Officerwill make these documents available upon receipt of a request from any member of theCompany interested in obtaining the same. These documents will also be available forinspection at the Registered Office of your Company during working hours up to the date ofthe Annual General Meeting.
As per the Companies (Amendment) Act 2017 dated 3rd January 2018 read withnotification dated 9th February 2018 a copy of Annual Report is available atwww.vyaparindustries.com.
DISCLOSURES UNDER SECTION 134(3) (I) OF THE COMPANIES ACT 2013
No material changes and commitments which could affect the Company financial positionhave occurred between the end of the financial year of the Company and the date of thisreport except as disclosed elsewhere in this report.
PARTICULARS ON CONSERVATION OF ENERGY AND TECHNOLOGY ABSORPTION:
This information is required as per Section 134(3)(m) of the Companies Act 2013 readwith rule 8 of the Companies (Accounts) Rules 2014. Since the Company's operationsinvolve low consumption of energy.The activities of the Company do not as such involve anytechnology absorption or expenditure on research and development. Nonetheless theCompany's endeavors would be to achieve what is best possible in its business.
FOREIGN EXCHANGE EARNINGS AND OUTGO:
Foreign exchange earned during the period under consideration was Rs.NIL. Foreignexchange expenditure incurred during year amounted to Rs.NIL.
The Board of Directors is duly constituted. As per provisions of Companies Act 2013for retirement by rotation all executive directors are now liable to retire by rotation.
The Company has formulated a policy on director appointment & remunerationincluding criteria for determining qualifications positive attributes independence ofdirector & other matters as provided under section 178(3) of the Companies Act 2013& such policy is annexed with the Director Report. The details of familiarizationprogramme for Independent Directors have been disclosed on website of the Company.Pursuant to the provisions of the Companies act 2013 and SEBI (Listing Obligation andDisclosure Requirements) 2015 evaluation of every Director's performance was done by theNomination and Remuneration Committee. The performance evaluation of the Non IndependentDirectors and the Board as a whole committees thereof and the chairperson of the companywas carried out by the Independent Directors. Evaluation of the Independent Directors wascarried out by the entire Board of Directors excluding the Directors being evaluated. Astructured questionnaire was prepared after circulating the draft norms covering variousaspects of the evaluation such as adequacy of the size and composition of the Board andCommittee thereof with regard to skill experience independence diversity attendanceand adequacy of time given by the directors to discharge their duties CorporateGovernance practices etc. The Directors expressed their satisfaction with the evaluationprocess.
POLICY ON DIRECTORS APPOINTMENT AND REMUNERATION:
The Company's policy on Directors appointment and remuneration including criteria fordetermining qualifications positive attributes independence of a Director and mattersprovided under sub-section (3) of Section 178 is as below:
The appointment policy for Independent Directors Key Managerial Personnel & SeniorExecutive is as under:
(A) Independent Directors:
Independent Directors are appointed based on the criteria mentioned under section149(6) of the Companies Act 2013 and in accordance with other applicable provisions ofthe Companies Act 2013 Rules made there under & Listing Agreement entered with StockExchanges.
(B) Key Managerial Personnel (KMP):
KMP are appointed by the resolution of the Board of Directors of the Company based onthe qualification experience and exposure in the prescribed fields. Removal of KMP isdone by the Resolution of the Board of Directors of the Company. Appointment/ Removal isin accordance with provisions of the Companies Act 2013 Rules made there under &Listing Agreement entered with Stock Exchange.
(C ) Senior Executives:
Senior Executives are appointed by the Chairman & Managing Director and/orExecutive Director of the Company based on their qualification experience and exposure.Removal of Senior Executives is also done by Chairman & Managing Director and/orExecutive Director. Further appointment & removal is noted by the Board as requiredunder clause 8(3) of Companies (Meetings of the Board and its powers) Rules 2014.
Following policies of the company are available on website of the Companywww.vyaparindustries.com as well as form a part of this report as Annexure 1 Annexure-2and Annexure-3.
Policy on appointment of Directors and Senior Management (Annexure-1)
Policy on Remuneration to Directors' (Annexure-2)
Policy on Remuneration of Key Managerial Personnel and Employees (Annexure-3)
PERFORMANCE EVALUATION OF INDEPENDENT DIRECTORS:
Criteria for performance of Independent Directors as required under SEBI (ListingObligations and Disclosure Requirements) Regulations 2015 is annexed herewith forms apart of this report.
DETAILS OF APPOINTMENT AND RESIGNATION OF DIRECTORS ANDKEY MANAGERIAL PERSONNEL:
During the year Mr. Parvez M. Master (DIN: 00024845) independent Director of theCompany has resigned on 12th August 2018. Mrs. Farida Engineer (DIN:06417865)was appointed as Independent Director of the Company on 27th August 2018. Mr.Abbas A. Rassai Non Executive Non Independent Promoter Director has resigned on 29thMarch 2019 and was reappointed on 30th May 2019 as Non Executive NonIndependent Promoter Director designated as Chairman of the Company. Mrs. Shabana MistryExecutive Director of the Company has resigned from Directorship on 30th May2019 but will continue as C.F.O of the Company. There was no other change in Directors andKey Managerial Personnel.
KEY MANAGERIAL PERSONNEL
Mr. Akil A. Rassai is the Managing Director of the Company upto 31stAugust 2020 Ms. Shabana Mistry is Chief Financial Officer and Mr. Anil KumarSingla is the Company Secretary of the Company. They are designated as "KeyManagerial Personnel" of the Company pursuant to Section 203 of the Companies Act2013 read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules2014.
STATEMENT ON DECLARATION BY THE INDEPENDENT DIRECTORS:
Mr. Ramesh W. Lalwaney (DIN: 00023420) Mrs. Farida Engineer (DIN: 06417865) and Mr.Hussain M. Cementwala (DIN: 03611787) are the Independent Directors of the Company and allindependent Directors have given declarations that they meet the criteria of independenceas laid down under section 149(6) of the Companies Act 2013 and clause (b) ofsub-regulation (1) of the Regulation 16 of SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015..
MEETING OF BOARD OF DIRECTORS:
A calendar of Meetings is prepared and circulated in advance to the Directors. Duringthe year 14(Fourteen) Board meetings and 7(Seven) Audit Committee Meeting were convenedand held. The intervening gap between the Meetings was within the period prescribed underthe Companies Act 2013. All the Directors actively participated in the meetings andcontributed valuable inputs on the matters brought before the Board of Directors from timeto time.
SUBSIDIARY COMPANIES JOINT VENTURES AND ASSOCIATE COMPANIES:
The Company does not have any Subsidiary Joint Venture and Associate Company.
RELATED PARTY TRANSACTIONS:
Related party transactions that were entered during the financial year were on an arm'slength basis and were in the ordinary course of business. There were materiallysignificant related party transactions with the Company's Promoters Directors Managementor their relatives which could have had a potential conflict with the interests of theCompany. Transactions with related parties entered by the Company in the normal course ofbusiness are periodically placed before the Audit Committee for its omnibus approval andthe particulars of contracts entered during the year as per Form AOC-2 is enclosed asAnnexure 5.
The Board of Directors of the Company has on the recommendation of the AuditCommittee adopted a policy to regulate transactions between the Company and its RelatedParties in compliance with the applicable provisions of the Companies Act 2013 the Rulesthere under and the SEBI LODR. This Policy was considered and approved by the Board hasbeen uploaded on the website of the Company at www.vyaparindustries.com.
SIGNIFICANT ORDERS PASSED BY REGULATORS COURTS OR TRIBUNALS IMPACTING GOING CONCERNAND COMPANY' OPERATION:
To the best of our knowledge the Company has not received any such orders fromRegulations Courts or Tribunals during the year which may impact the going concernstatus or the Company's operations in future.
LISTING WITH STOCK EXCHANGES:
Your Company continues to be listed on the Bombay Stock Exchange where the Company'sshares are being traded. The company has paid listing fees for the financial year 2019-20.
DEMATERIALISATION OF SHARES:
99.999% of the company's paid up Equity Share Capital is in dematerialized form as on31st March 2019 and balance 0.00003 % (19 shares) is in physical form.
EXPLANATION OR COMMENTS ON AUDITORS' REPORT AND
SECRETARIAL AUDIT REPORT:
The observations and comments furnished by the Auditors in their report read togetherwith the notes to Accounts are self-explanatory and hence do not call for any furthercomments under Section 134 of the Companies Act 2013.
There are no qualifications reservations or adverse remarks or disclaimer made by thestatutory auditors in their audit report or by the practicing company secretary in thesecretarial audit report
The Statutory Auditor has not reported any incident of fraud of the company during thefinancial year 2018-2019.
CASH FLOW STATEMENT
Cash flow statement pursuant to Regulation 34(2)(c ) of the SEBI LODR is attachedherewith
The present Statutory Auditors of the Company M/s.M. M. PARIKH & CO. CharteredAccountants Mumbai (ICAI Registration No.107557W) have shown their unwillingness tocontinue as Statutory Auditors of the Company from the forthcoming Annual General Meetingand M/s. Gohel & Associates LLP.(ICAI Registration No.107557W) be and is herebyappointed as Statutory Auditors of the Company in place of M/s. M. M. PARIKH &CO.(ICAI Registration No.107557W) who have shown their unwillingness to continue asStatutory Auditor of the Company w.e.f. this Annual General Meeting to hold office for aterm of five consecutive years from the conclusion of this 34th Annual GeneralMeeting until the conclusion of the 39th Annual General Meeting of the Companyto be held in the calendar year 2024. Accordingly your Board recommends theirappointment. The Company has obtained eligibility certificate from the auditors along withwritten certificate from to the effect that the appointment if made will be inaccordance with the limit specified in Section 141 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 Company hadappointed M/s. Sherlyn Rebello & Associates Company Secretaries to undertakeSecretarial Audit of the Company for the financial year 2018-19. The Secretarial AuditReport does not contain any qualification reservation or adverse remark.
MAINTENANCE OF COST RECORDS:
The maintenance of cost records as specified by the Central Government undersub-section (1) of section 148 of the Companies Act 2013 is not required for yourCompany and accordingly such accounts and records are not made and maintained by theCompany
DIRECTORS RESPONSIBILITY STATEMENT
In terms of Section 134(5) of the Companies Act 2013 the Board of Directors of theCompany hereby confirms that:
i. In the preparation of the annual accounts for the financial year ended 31stMarch 2019 the applicable accounting standards have been followed along with properexplanation relating to material departures.
ii. 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 and loss of the Company for the year ended 31st March 2019.
iii. The Directors have taken sufficient and proper care for the maintenance ofadequate accounting records in accordance with the provisions of the Companies Act 2013for safeguarding the assets of the Company and for preventing and detecting material fraudand other irregularities.
iv. The Directors have prepared the Annual Accounts on a going concern basis.
v. There are proper systems have been devised to ensure compliance with the provisionsof all applicable laws and that such systems were adequate and operating effectively.
vi. 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.
Based on the framework of internal financial controls and compliance systemsestablished and maintained by the Company work performed by the internal statutory andsecretarial auditors and external consultants including audit of internal financialcontrols over financial reporting by the statutory auditors and the reviews performed bymanagement and the relevant board committees including the audit committee the board isof the opinion that the Company's internal financial controls were adequate and effectiveduring FY 2018-19.
ANNUAL EVALUATION BY THE BOARD OF ITS OWN PERFORMANCE ITS COMMITTEES AND INDIVIDUALDIRECTORS
The Board of Directors of the Company has initiated and put in place evaluation of itsown performance its committees and individual directors. The result of the evaluation issatisfactory and adequate and meets the requirement of the Company.
DETAILS OF COMMITTEE OF DIRECTORS
Composition of Audit Committee of Directors Nomination and Remuneration Committee ofDirectors and Stakeholders Relationship/Grievance Committee of Directors number ofmeetings held of each Committee during the financial year 2018-19 and meetingsattended by each member of the Committee as required under the Companies Act 2013 areprovided in Corporate Governance Report forming part of this report.
The recommendation by the Audit Committee as and when made to Board has been acceptedby it.
During the year Management of the Company evaluated the existing Risk ManagementPolicy of the Company to make it more focused in identifying and prioritizing the risksrole of various executives in monitoring & mitigation of risk and reporting process.Its aim is to enhance shareholders value and provide an optimum risk-reward tradeoff. TheRisk Management Policy has been reviewed and found adequate to the requirements of theCompany and approved by the Board.
The Management evaluated various risks and that there is no element of risk identifiedthat may threaten the existence of the Company.
The Company has put in place Vigil Mechanism. The detailed mechanism is given inCorporate Governance Report forming part of this report.
A separate report on Corporate Governance as stipulated under the SEBI(LODR)Regulations 2015 forms part of this Report. The requisite certificate from the PracticingCompany Secretary of the Company regarding compliance with the conditions of corporategovernance is attached to the report on corporate governance report and managementdiscussion and analysis are attached which form part of this report.
MANAGING DIRECTOR'S CERTIFICATE
A Certificate from the Managing Director in respect of the Financial Statements formspart of the Annual Report.
CODE OF CONDUCT:
The Board of Directors has approved a Code of Conduct which is applicable to theMembers of the Board and all employees in the course of day to day business operations ofthe Company.
EXTRACT OF ANNUAL RETURN:
The details forming part of the extract of the Annual Return in Form MGT-9 is annexedherewith as Annexure 6.
CHANGE IN THE NATURE OF BUSINESS:
During the year under review there has been no change in the nature of business of theCompany.
SUBSIDIARIES JOINT VENTURES AND ASSOCIATE COMPANIES:
The Company does not have any subsidiaries joint ventures or associate companies.
PARTICULARS OF EMPLOYEES:
During the year under report none of the employees of the company was in receipt ofremuneration for any part of the year in excess of the amount of remuneration prescribedin section 197 of the Companies Act 2013 read with Rule 5(2) and Rule 5(3) of theCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014 as amendedup to date.
CORPORATE SOCIAL RESPONSIBILITY
The Section 135 of the Companies Act 2013 regarding Corporate Social ResponsibilityCommittee is not applicable to the Company as the Networth Turnover and Profit of theCompany are below the threshold limit prescribed by the Companies Act 2013.
SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS
There were no significant and material orders passed by the regulators or courts ortribunals which may impact the going concern status of the Company and its operations infuture.
PRESENTATION OF FINANCIAL STATEMENTS
The financial statements of the Company for the year ended 31st March2019 have been disclosed as per Schedule III to the Companies Act 2013.
A copy of audited financial statements of the company will be made available to themembers of the Company seeking such information at any point of time. A cash flowstatement for the year 2018-2019 is attached to the Balance Sheet.
DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT A WORKPLACE (PREVENTION PROHIBITIONAND REDRESSAL) ACT 2013
The Company is committed to provide a healthy environment to all the employees and thusdoes not tolerate any sexual harassment at workplace. The Company has in place
Policy on prevention Prohibition and Redressal of Sexual Harassment.". The policyaims to provide protection to employees at the workplace and preventing and redressingcomplaints of sexual harassment and it covers matters connected or incidental thereto. TheCompany has complied with the provisions relating to the constitution of InternalComplaints Committee under the Sexual Harassment of Women at Workplace (preventionProhibition and Redressal) Act 2013
The company has not received any compliant of sexual harassment during the financialyear 2018-2019.
All assets of the company including inventories plant and machineries are adequatelyinsured.
Yours Directors take this opportunity to thank the Financial Institutions BanksBusiness Associates Central and State Government authorities Regulatory authoritiesStock Exchanges and all the various stakeholders for their continued co-operation andsupport to the Company and look forward to their continued support in future.
We very warmly thank all our employees for their contribution to your Company'sperformance.
We applaud them for their superior levels of competence dedication and commitment toyour Company.
|For and on behalf of the Board of Vyapar Industries || |
|Limited || |
|Sd/- ||Sd/- |
|Akil A. Rassai ||Hussain A. Rassai |
|Managing Director ||Joint Chairman |
|DIN: 00021329 ||DIN: 00021454 |
145 S.V. Road Khar (W)
May 30 2019
TO THE DIRECTORS' REPORT FOR THE YEAR ENDED 31ST MARCH 2019 POLICY ON APPOINTMENT OFDIRECTORS AND SENIOR MANAGEMENT
Appointment of Directors
The Nomination and Remuneration Committee (NRC) of the Board of Directors (Board) ofthe Company reviews and assesses Board composition and recommends the appointment of newDirectors. In evaluating the suitability of individual Board member the NRC shall takeinto account the following criteria regarding qualifications positive attributes and alsoindependence of director when Independent Director is to be appointed:
1. All Board appointments will be based on merit in the context of the skillsexperience diversity and knowledge for the Board as a whole to be effective;
2. Ability of the candidates to devote sufficient time and attention to his / herprofessional obligations as Director for informed and balanced decision making;
3. Adherence to the applicable Code of Conduct and highest level of CorporateGovernance in letter and in sprit by the Directors;
Based on the recommendations of the NRC the board will evaluate the candidates anddecide on the selection the appropriate member. The Board through the Chairman or theManaging Director will interact with the new member to obtain his/her consent for joiningthe Board. Upon receipt of the consent the new Director will be co-opted by the Board inaccordance with the applicable provisions of the Companies Act 2013 and Rules made thereunder.
Removal of Directors
If a Director is attracted with any disqualification as mentioned in any of theapplicable Act rules and regulations there under or due to non - adherence to theapplicable policies of the Company the NRC may recommend to the Board with reasonsrecorded in writing removal of a Director subject to the compliance of the applicablestatutory provisions.
Senior Management Personnel
The NRC shall identify persons based on merit experience and knowledge who may beappointed in senior management team.
Senior Management personnel are appointed or promoted and removed/relieved with theauthority of Managing Director & CEO based on the business need and the suitability ofthe candidate. The details of the appointment made and the personnel removed one levelbelow the Key Managerial Personnel during a quarter shall be presented to the Board.
For and on behalf of the Board of Vyapar Industries Limited
Akil A. Rassai
TO THE DIRECTORS' REPORT FOR THE YEAR ENDED 31ST MARCH 2019
POLICY FOR REMUNERATION OF THE DIRECTORS
This Policy sets out the approach to Compensation/remuneration/commission etc. will bedetermined by Committee and Recommended to the Board of Directors for approval. Alsoremuneration to be paid to the Managing Director other executive directors in accordancewith provisions of Companies Act 2013 and other statutory provisions if any wouldrequire to complying for time being of appointment of such person.
The Company has a well-defined Compensation policy for Directors including theChairman of the Company. The overall compensation philosophy which guides us to focus onenhancing the value to attract to retain and motivate Directors for achieving objectivesof Company and to become a major player in market to be the most trusted brand in thebusiness we operate in and focus on customer serenity through transparency quality and ontime delivery to be a thought leader and establish industry benchmarks in sustainabledevelopment.
In order to effectively implement this the Company has built a compensation structureby a regular annual benchmarking over the years with relevant players across the industrythe Company operates in.
Non-Executive Including Independent Directors
The Nomination and Remuneration Committee (NRC) shall decide the basis for determiningthe compensation both fixed and variable to the Non-Executive Directors includingIndependent Directors whether as commission or otherwise. The NRC shall take intoconsideration various factors such as director's participation in Board and Committeemeetings during the year other responsibilities undertaken such as membership orChairmanship of committees time spent in carrying out their duties role and functions asenvisaged in Schedule IV to the Companies Act 2013 and the LODR with Stock Exchanges andsuch other factors as the NRC may consider deem fit for determining the compensation. TheBoard shall determine the compensation to Non-Executive Directors within the overalllimits specified in the Shareholders resolutions.
Managing Director (MD) and Executive Director
Remuneration of the MD and Executive Directors reflects the overall remunerationphilosophy and guiding principle of the Company. While considering the appointment andremuneration of Managing Director and Executive Directors the NRC shall consider theindustry benchmarks merit and seniority of the person and shall ensure that theremuneration proposed to be paid is commensurate with the remuneration packages paid tosimilar senior level counterpart(s) in other companies. The policy aims at a balancebetween fixed and variable pay reflecting short and long-term performance objectivesappropriate to the working of the company and its goals.
The remuneration to the MD shall be recommended by NRC to the Board. The remunerationconsists of both fixed compensation and variable compensation and shall be paid as salarycommission performance bonus stock options (where applicable) perquisites and fringebenefits as per the policy of the Company from time to time and as approved by the Boardand within the overall limits specified in the Shareholders resolution. While the fixedcompensation is determined at the time of appointment the variable compensation will bedetermined annually by the NRC based on the performance of MD.
The term of office and remuneration of MD is subject to the approval of the Board ofDirectors shareholders and Central Government as may be required and within thestatutory limits laid down in this regard from time to time.
If in any financial year the Company has no profits or its profits are inadequatethe Company shall pay subject to the requisite approvals remuneration to its MD inaccordance with the provisions of Schedule V to the Companies Act 2013
If a MD draws or receives directly or indirectly by way of remuneration any such sumsin excess of the limits prescribed under the Companies Act 2013 or without the priorsanction of the Central Government where required he/she shall refund such sums to theCompany and until such sum is refunded hold it in trust for the Company. The Companyshall not waive recovery of such sum refundable to it unless permitted by the CentralGovernment of the Company.
Remuneration for MD is designed subject to the limits laid down under the CompaniesAct 2013 to remunerate him / her fairly and responsibly. The remuneration to the MDcomprises of salary perquisites and benefits as per policy of the Company and performancebased incentive apart from retirement benefits like P.F. Superannuation Gratuity LeaveEncashment etc. as per Rules Salary is paid within the range approved by theShareholders. Increments are effective annually as recommended /approved by the NRC /Board. The MD is entitled for grant of Stock Options as per the approved Stock OptionsSchemes of the Company from time to time.
The MD is an executive of the Company and draws remuneration from the Company. TheNon-Executive Independent Directors receive sitting fees for attending the meeting of theBoard and Committee thereof as fixed by the Board of Directors from time to time subjectto statutory provisions. The Non-Executive Independent Directors would be entitled to theremuneration under the Companies Act 2013. In addition to the above the Directors areentitled for reimbursement of expenses incurred in discharge of their duties.
The Company may also grant Stock Options to the eligible employees and Directors (otherthan Independent Directors) in accordance with the ESOP Schemes of the Company from timeto time and subject to the compliance statutes and regulations.
Information on the total remuneration of members of the Company's Board of DirectorsManaging Director and Executive Directors and KMP/senior management personnel may bedisclosed in the Board's report and the Company's annual report / website as per statutoryrequirements in this regard.
For and on behalf of the Board of Vyapar Industries Limited
Akil A. Rassai
TO THE DIRECTORS REPORT FOR THE YEAR ENDED 31ST MARCH 2019: POLICY ONREMUNERATION OF KEY MANAGERIAL PERSONNEL AND EMPLOYEES
To establish guidelines of remuneration/ compensation/ commission etc. to be paid foremployees by way of fairly and in keeping with Statutes it will be determined by theNomination & Remuneration committee (NRC) and the NRC will recommend to the Board forapproval.
1. All employees irrespective of contract are to be paid remuneration fairly and theremuneration is to be externally competitive and internally equitable. The remunerationwill be paid in accordance with the laid down Statutes.
2. Remuneration for on-roll employees will include a fixed or guaranteed componentpayable monthly; and a variable component which is based on performance and paid annually.
3. The fixed component of remuneration will have a flexible component with a bouquet ofallowances to enable an employee to choose the allowances as well as the quantum based onlaid down limits as per Company policy. The flexible component can be varied only onceannually in the month of July after the salary increment exercise.
4. The variable component of the remuneration will be a function of the employee'sgrade.
5. The actual pay-out of variable component of the remuneration will be function ofindividual performance as well as business performance. Business performance is evaluatedusing a Balance Score Card (BSC) while individual performance is evaluated on Key ResultAreas (KRA). Both the BSC & KRAs are evaluated at the end of the fiscal to arrive atthe BSC rating of the business and PPS rating of the individual.
6. An Annual compensation survey is carried out to ensure that the Company'scompensation is externally competitive. Based on the findings of the survey and thebusiness performance the committee decides:
(i) The increment that needs to be paid for different performance ratings as well asgrades.
(ii) The increment for promotions and the total maximum increment.
(iii) The maximum increase in compensation cost in % and absolute.
(iv) Compensation corrections are made in a few cases where it is outside theband or to keep it tune with the market.
For and on behalf of the Board of Vyapar Industries Limited
Akil A. Rassai