Your Directors hereby submits the twenty-eighth annual report of thebusiness and operations of your Company along with the audited financial statements forthe financial year ended March 31 2018
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|Revenue from operations || |
|Other Income || |
|Total Revenue || |
|Profit / (Loss) before interest depreciation taxes and exceptional items || |
|Less: Interest || |
|Less: Depreciation || |
|Profit / (Loss) before exceptional Items || |
|Less: Exceptional Items & Income tax & other Provisions || |
|Profit / (Loss) after Tax || |
During the year under review your Company was not able to utilize themanufacturing capacity at its optimum. During this financial year the Company completedOTS with all banks and their total dues were paid. A loan with ARC is outstanding and willbe paid in installments as per their sanction with no interest payable on the outstandingloan as per the terms of the sanction.
Your Company reported total revenue of H18327.25 Lakhs againstH29608.04 Lakhs during the last financial year. The Company earned a profitof H263.38Lakhs after providing H1639.32 Lakhs towards depreciation and H855.89 Lakhs towardsinterest during the current financial year as compared to a profit ofH7874.06 Lakhs in thelast financial year.
Your directors have not recommended any dividend for the year ended31st March 2018 in view of the restrictions under Section 123 of the Companies Act 2013(the Act) as amended by the Companies (Amendment) Act 2015 becoming effective from 29thMay 2015 by virtue of which no Company can declare dividend unless carried over previouslosses and depreciation not provided in previous year or years are set off against profitof the Company for the current year.
DIRECTORS a) Changes in Directors and Key Managerial Personnel: Inaccord with the provisions of Section 152 of the Act read with Article 91 of the Articleof Association of the Company S. L. Agarwal Managing Director will retire by rotation atthe ensuing AGM and being eligible offer himself for reelection. The Board hasrecommended their re-election. b) No. of Meetings of the Board: Five meetings of the Boardwere held during the year ended March 31 2018. c) Declaration by Independent Directors:All Independent directors have given declarations that they meet the criteria ofindependence as laid down under
Section 149(6) of the Companies Act 2013 and as per respectiveregulation of SEBI Listing Regulation(LODR) 2015. The declaration is received in the firstBoard of Directors for the year. d) Separate Meeting of Independent Director:
Details of the separate meeting of Independent Directors held in termsof Schedule IV of the Act and Regulation 25(3) of the Listing Regulations are given in theCorporate Governance Report.
M/s T. More & Co. Chartered Accountants (FRN 327844E) wereappointed as Statutory Auditors of your Company at the Annual General Meeting held on 23rdSeptember 2017 for a term of five consecutive years. However M/s T. More & Co. havetendered their resignation from the Auditorship with effect from the conclusion of theensuing Annual General Meeting of the shareholders of the Company.
The Company has received special notice u/s 115 of the Companies Act2013 from two shareholders of the Company expressing their desire to propose the name ofM/s G. P. Agrawal & Co. Chartered Accountants as Statutory Auditors of the Company.
M/s G. P. Agrawal & Co. has given their consent to act as StatutoryAuditor of the Company if appointed.
There is no qualification reservation adverse remark or disclaimergiven by the Auditors in their report.
Clarification/explanation on remarks in Independent Auditors'
Report a. In the comments of Auditors under para "EMPHASIS OF
MATTER" regarding confirmation of accounts the director statesthat all the balance confirmation letters have been sent to respective vendors andcustomers confirmations from all have not been received. b. In Annexure B point No. 1(a)of the Auditors' Report regarding updation of fixed asset Register your Directorshave to state that fixed asset register will be completed in the next financial year. c.As regards delay in payment of undisputed statutory dues mentioned in Annexure B point no.7(a) to the Auditors'
Report it is submitted that it was due to the continuous adversefinancial condition and no banking facility currently available to the Company. Howeverwe hereby submit that all the statutory dues relating to the financial year 2017-18 havesince been paid.
Cost Audit is not applicable to the Company.
Your Board appointed M/s. AL & Associates Practicing CompanySecretaries to conduct a secretarial audit of the Company for the financial year ended31st March 2018. The report of the M/s. AL & Associates is provided in the AnnexureA' forming part of this report pursuant to Section 204 of the Act.
The Company has neither accepted nor renewed any deposits as envisagedin Section 73 of the Companies Act 2013 during the year under review.
KEY MANAGERIAL PERSONNEL:
Pursuant to the provisions of Section 203 of the Act the KeyManagerial Personnel of the Company are Mr. S.L. Agarwal Managing Director Mrs. SimaJhunjhunwala Chief financial Officer and Mrs. Sweta Biyani Company Secretary. During theyear there has been no change in the Key Managerial Personnel of the Company. Detailspertaining to their remuneration have been provided in the Extract of Annual Returnannexed hereto and forming part of this Report.
COMMITTEES OF THE BOARD:
Pursuant to various requirements under the Act and the ListingRegulations the Board of Directors has constituted various committees such as AuditCommittee Nomination
& Remuneration Committee Stakeholders Relationship CommitteeCorporate Social Responsibility Committee and Share Transfer Committee. The details ofcomposition terms of reference etc. pertaining to these committees are mentioned in theCorporate Governance Report.
All recommendations made by the Audit Committee during the year wereaccepted by the Board.
The Company has in place a Whistleblower Policy to deal with unethicalbehavior victimization fraud and other grievances or concerns if any. Theaforementioned whistleblower policy is available on the Company's website at thefollowing web-link: https://www.websolar.com/investor-corner/corporate-governance.
POLICY ON SELECTION AND REMUNERATION OF DIRECTORS:
Based on the recommendation of the Nomination & RemunerationCommittee the Policy on Selection & Remuneration of Directors Key ManagerialPersonnel and other employees was revised and adopted by the Board of Directors at theirmeeting held on 21.08.2017. The said policy was made applicable w.e.f 01.10.17.
Pursuant to the provisions of the Act and Regulation 17 of the ListingRegulations the Board has carried out the evaluation of its own performance and that ofits Committees as well as evaluation of the performance of the individual directors. Themanner in which the evaluation has been carried out has been explained in the CorporateGovernance Report attached to this Report.
LISTING OF SECURITIES IN STOCK EXCHANGES
The shares of the Company are listed on Bombay Stock Exchange Limitedand National Stock Exchange of India Limited. Outstanding FCCBs of the Company are listedon Singapore Stock Exchange.
CODE OF CONDUCT FOR PREVENTION OF INSIDER TRADING
In terms of the Securities and Exchange Board of India (Prohibition ofInsider Trading) Regulations 1992 your
Company has adopted the Code of Conduct for Prevention of InsiderTrading approved by Board of Directors inter alia prohibits trading in securities ofthe Company by Directors and employees on the basis of unpublished price sensitiveinformation in relation to the Company.
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION FOREIGN EXCHANGE EARNINGAND OUTGO
Information in accordance with the provisions of Section 134(3) (m) ofthe Companies Act 2013 read with Rule 8(3) of the Companies (Accounts) Rules 2014regarding conservation of energy technology absorption foreign exchange earnings andoutgo are given in the Annexure B which forms part of this report.
RISK MANAGEMENT POLICY:
The policy on risk assessment and minimization procedures as laid downby the Board are periodically reviewed by the Audit Committee and the Board. The policyfacilitates the identification of risks at the appropriate time and ensures necessarysteps to be taken to mitigate the risks. Brief details of risks and concerns are given inthe Management Discussion and Analysis Report.
EXTRACT OF ANNUAL RETURN
The extract of Annual Return in form MGT 9 is given in Annexure C tothe Report.
MATERIAL CHANGES AND COMMITMENTS:
There are no material changes and commitments affecting the financialposition of the Company between the end of the financial year i.e. 31st March 2018 and thedate of this Report.
SIGNIFICANT AND MATERIAL ORDERS:
There are no significant/ material orders passed by the Regulators /Courts / Tribunals which would impact the going concern status of the Company and itsfuture operations.
INTERNAL FINANCIAL CONTROLS:
The Company has in place adequate internal financial controls withreference to the financial statements. During the year such controls were reviewed and noreportable material weakness was observed
ANNUAL CSR REPORT
The Company has formed the CSR Committee at the end of last financialyear. However due to cash crisis the Company could not spend any amount on CSR activitiesduring the financial year but has considered to spent the amount in the financial year18-19 if there are profits in the profit and loss account.
MANAGERIAL REMUNERATION AND PARTICULARS OF EMPLOYEES
The information required pursuant to Section 197 read with Rule 5 ofthe Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 inrespect of managerial personnel and employees of the Company is attached herewith inAnnexure D.
PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES
In line with the requirements of Companies Act2013 and Listing
Regulations your company has formulated a Policy on Related
Party Transactions which is also available on the Company'swebsite at https://www.webelsolar.com/investorscorner/ corpoarte-governance. The policyintends to ensure that proper reporting approval and disclosure processes are in placefor all the transaction between the Company and Related Parties. All related partyTransactions are in place before the Audit Committee for review and approval. All relatedparty transactions that were entered into during the financial were on arm's lengthbasis and were in the ordinary course related of the business. There are no materiallysignificant party transactions made by the Company with promoters key managerialpersonnel or other designated persons which may have potential conflict with the interestof the Company at large. Necessary disclosure regarding transactions with related partieshas been made in the Notes to the Audited Accounts.
All related party transactions entered during the year were in theordinary course of the business and at arm's length basis. No material related partytransactions i.e. transactions exceeding 10% of the annual consolidated turnover as perthe latest audited financial statement were entered during the year by our Company.Accordingly the disclosure of related party transactions as required under section134(3)(h) of the Companies Act2013 in Form AOC-2 is not applicable.
PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS UNDER SECTION 186
The Company has not given any Loan Guarantee or made any investmentsor provided any security in violation of section 186 of Companies Act 2013.
STATE OF AFFAIRS OF THE COMPANY
The Company has made a settlement with all the lenders of workingcapital and term loan. No Due Certificates have been received from the banks. The Companyhas made expansion in the year thereby increasing its production capacity from 200 MW to280 MW (Cell Line) and Module line from 90 MW manual line to 250 MW fully automated Moduleline. Your Company is planning to expand its existing capacity further to 300 MW (CellLine) and Module line to 500 MW from existing 250 MW.
CORPORATE GOVERNANCE REPORT
Maintaining high standards of Corporate Governance has been fundamentalto the business of the Company since its inception. A separate report on CorporateGovernance along with a certificate from the Auditors of the Company regarding Complianceof Conditions of Corporate Governance as stipulated under Listing Regulations is annexedin Annexure-E which forms part of this report. A certificate of CFO of the Company interms of Listing Regulations inter alia confirming the correctness of financialstatements and cash flow statements adequacy of internal control measures is alsoannexed. The extract of annual return in Form MGT-9 as required under section 92(3) of theCompanies Act and Rule 12 of the companies (Management and Administration) Rules 2014 isappended as an Annexure to this Annual Report.
SEXUAL HARASSMENT AT WORKPLACE
Your Company has in place a formal policy for the prevention of sexualharassment of its employees at the workplace. During the year there were no cases filedHarassment of Women at Workplace (Prevention Prohibition and Redressal) Act 2013.
DIRECTORS' RESPONSIBILITY STATEMENT
We the Directors of the Company hereby confirm that pursuant toprovisions of section 134(5) of the Companies Act 2013 in respect of financial yearunder review: i) In the preparation of the Annual Accounts for the financial year ended31st March 2018 the applicable accounting standards have been followed and there are nomaterial departures from the same; ii) We have selected such accounting policies andapplied them consistently and made judgments and estimates that are reasonable and prudentso as to give a true and fair view of the state of affairs of the Company at the end ofthe financial year as at 31st March 2018 and of the Profits the Company for that period;iii) We have taken proper and sufficientcare for the maintenance of adequate accountingrecords in accordance with the provisions of the Companies Act 2013 for safeguarding theassets of the Company and for preventing and detecting fraud and other irregularities;and iv) We have prepared the annual accounts on a "going concern" basis. v) Wehave laid down financialcontrols for the internal Company and that such financialcontrolsare internal adequate and operating effectively. vi) We have devised proper systems toensure compliance with the provisions of all applicable laws and such systems wereadequate and operating effectively
The directors place on record their deep appreciation to employees atall levels for their hard work dedication and commitment towards their duty leading tocordial industrial relations.
The Board places on record its appreciation for the support andco-operation the Company has been receiving from its suppliers distributors retailersbusiness partners and others associated with it as its trading partners. The Company looksupon them as partners in its progress and has shared with them the rewards of the growth.
The Board of Directors take this opportunity to place on record itsdeep sense of gratitude for the continued support assistance and co-operation receivedfrom the all the shareholder
Customers Vendors Government Authorities and Banks. to the Sexual
On behalf of the Board of Directors For WEBSOL ENERGY SYSTEM LIMITED
|D. Sethia S. || |
|Independent Director || |
Date : 31st August 2018 Place : Kolkata