Your Directors have pleasure in presenting the 38th Annual Report together with theAudited Financial Statements of the Company for the financial year ended 31st March 2019.
|FinancialHighlights ||Year ended 31.3.2019 (Rs. in lacs) ||Year ended 31.3.2018 (Rs. in lacs) |
|Sales ||72418.29 ||69980.95 |
|Profit before Interest & Depreciation ||8643.40 ||7994.23 |
|Less : Interest ||4839.25 ||4835.22 |
|Profit/(Loss) before Depreciation ||3804.15 ||3159.01 |
|Less : Depreciation ||2373.51 ||2470.75 |
|Profit/(Loss) before Tax ||1430.64 ||688.26 |
|Less : Provision for Taxation - Current Tax/MAT ||334.01 ||153.47 |
|- MAT Credit ||(40.48) ||(153.47) |
|- Deferred Tax Liability/(Assets) ||(74.75) ||422.69 |
|- MAT Credit earlier year/Charged Earlier Year ||- ||- |
|- Tax/MAT for earlier years ||- ||(280.46) |
|- Tax Adjustment for the earlier year ||0.02 ||49.79 |
|Net Profit/ (Loss) after Tax ||1211.84 ||496.24 |
|Add : Surplus brought from previous year ||2988.97 ||9766.38 |
|Less: Adjustments & amounts transferred to General Reserves ||(1000) ||(7273.65) |
| ||3276.07 ||2988.97 |
|Appropriations : || || |
|Proposed Dividend ||NIL ||NIL |
|Corporate Dividend Tax ||NIL ||NIL |
|Surplus Carried to Balance Sheet ||3276.07 ||2988.97 |
| ||3276.07 ||2988.97 |
During the year under review your Company has achieved a sales turnover of Rs.72418.29lacs as against sales turnover of Rs. 69980.95 lacs during the previous year showing anincrease of 3.48% and a net profit (after tax) of Rs.1211.84 lacs for the year against netprofit (after tax) of Rs. 496.24 lacs during the previous year. The exports of the companyfor the current financial year were of Rs.26543.83 lacs against Rs. 25570.84 lacs for theprevious financial year.
The Textile Industry has still not recovered from the effect of demonetization and GST.Beside this other factors like higher price cotton due to lower Indian cotton productionhas added to already existing factors impacting profitability. Due to higher prices ofcotton Indian products became uncompetitive and resulted in lower export exmillrealization. Similarly USA Trade war with China has also damped sentiments ofinternational Trade Growth.
Impact of above factors was comparatively limited in performance in your Company as thecompared to the pain being felt in Textile Industry mainly due to our supply of valueadded yarns including dyed yarn and fabrics to customers in both domestics andinternational markets.
ACCOLADES AND RECOGNITIONS
We are delighted to inform you that your Company conferred with Silver Trophy by'TEXPROCIL' for second Highest Exports of Cotton Yarn (Processed Yarns) in the Category IIfor F.Y. 2016-17. Apart from this your Company is making persistent efforts to maintainits distinguish position in the competitive environment.
HYDRO POWER PROJECT OF COMPANY
The Company's Manuni Hydro electric Power Project (3.5 M.W.) at Dharamshala Distt.Kangra Manuni Khad (H.P.) has been synchronized with H.P.S.E.B.L. Grid on 31.03.2017.Further during the year under review Manuni Hydro electric Project has generated about110 lacs units against 97 lacs units in the previous year.
MODERNISATION & EXPANSION
During the year under review the Company has taken several progressive steps formodernization / expansion of plants. Major details are listed below:
(a) New Card (04 nos) state of art machines were purchased with latest technologyhaving measure such as energy saving spindles and highly energy efficient motors. Besidesthis reduction in steam consumption is made by process improvements.
(b) Company has installed TEXPART Spindle CS-1 on one Ring Frame having 1200 spindlesto enhance power saving & getting better yarn quality.
(c) Company has done conversion on Ring Frame 10 Nos from Flat belt to Timing Belt toget smart amount of power saving & better performance.
(d) Company has installed Sample Dyeing M/C Model: RVS-10 Make: CUBOTEX Capacity: 40Kgs in Dyeing Lab.
(e) Company has installed One Post Winding M/C Make: RESHMI in Dye House.
(f) Company has installed One Yarn Conditioning M/C Make: SIEGER 1600 kg dual typeheating to enhance the yarn condition capacity in dye House.
The paid up Equity Share Capital as at March 31 2019 was Rs.198200000/- (comprisedof 19820000 equity shares of Rs.10/- each). During the year under review the Companyhas neither issued any shares nor granted stock options or sweat equity preference sharesand also not made any provision for purchase of its own shares by employees or bytrustees.
PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS
The Company has not given any loan or provided any security/guarantee as per section186 of the Companies Act 2013 during the year 2018-19. The Investments under section 186of the Act are given in the Financial Statements forming part of the Annual Report.
The Company has not accepted /renewed any deposits from the public during the FY2018-19.
DIVIDEND & RESERVES
Keeping in view to conserve the resources your Directors do not recommend any dividendfor the FY 201819. The Company has proposed to carry Rs.1000 Lacs from surplus in theP&L account to General reserves.
INVESTOR EDUCATION PROTECTION FUND (IEPF)
Pursuant to Section 124(5) of Companies Act 2013 read with the IEPF Authority(Accounting Audit Transfer and Refund) Rules 2016 ("the IEPF Rules") allunpaid or unclaimed dividends are required to be transferred by the Company to the IEPFestablished by the government of India after the completion of seven years. Furtheraccording to the rules the share on which dividend has not been paid or claimed by theshareholders for seven consecutive years or more shall also be transferred to the demataccount of IEPF Authority. During the year under review the Company has transferred theunclaimed and unpaid dividend for the Financial Year 2010-11 of Rs. 45120/- (Rupees FortyFive Thousand One Hundred Twenty Only). Further 27684 corresponding equity shares onwhich dividend were unclaimed for seven consecutive years were also transferred as per therequirement of the IEPF rules.
However the Shareholders are entitled to claim their shares including all thecorporate benefits accruing on such shares if any from the IEPF Authority by submittingan online application in Form IEPF-5 and sending a physical copy of the Form IEPF-5 dulysigned by all the joint shareholders if any as per the specimen signature recorded withthe Company along with requisite documents enumerated in the Form IEPF-5 to the Company'sRTA. The Rules and Form IEPF-5 as prescribed for claiming back the shares are availableon the website of the IEPF www.iepf.gov.in. It may please be noted that no claim shall lieagainst the Company in respect of share(s) transferred to IEPF pursuant to the said Rules.
NUMBER OF MEETINGS HELD
The details of Board and Committee Meetings are given in the Corporate GovernanceReport.
DIRECTORS/ KEY MANAGERIAL PERSONNEL
Shri Ashish Bagrodia Chairman & Managing Director (DIN - 00047021) shall be liableto retire by rotation at the ensuing Annual General Meeting being eligible he hasoffered himself for re-appointment. Further first term of appointment of Sh. ChandraMohan (DIN - 00017621) and Sh. Satish Girotra (DIN - 01112511) as an IndependentDirectors of the Company shall expire on 28.09.2019 and being eligible and they haveoffered themselves for re-appointment for further period of five consecutive years.Further as on date Sh. Chandra Mohan and Sh. Satish Girotra have attained the age ofSeventy Five years hence their reappointment shall be by way of Special Resolutions.
There was a change in the composition of the Board during the F.Y. 2018-19 as ShriAmrit Lal Batra (DIN - 00399728) an Independent/Non-Executive Director has resignedw.e.f. 03.11.2018 citing personal reasons. There was no change in the Key ManagerialPersonnel during the year.
ANNUAL EVALUATION OF BOARD AND ITS COMMITTEES AND OF INDIVIDUAL DIRECTORS.
As per Companies Act 2013 and Listing Regulations Board has adopted formal mechanismfor evaluating its performance and as well as that of its committees individualDirectors including the Chairman of the Board in compliance of Companies Act 2013 andListing Regulations. The exercise was carried out through a structured evaluation processcovering various aspects of the Boards functioning such as composition of the Board itscommittee & members their experience & competencies performance of specificduties & obligations governance. Broadly the performance ofNon-Independent/Executive/Whole Time Director(s) was evaluated on the basis of their ownperformance expertise intelligence their qualitative & quantitative contributiontowards operational achievements organizational performance etc. The performance ofNon-Executive Independent Directors were evaluated on the basis of their constructiveparticipation's in Board/Committee/General meetings their informed & balanceddecision-making ability to monitor financial controls systems & certain alliedparameters. The annual performance evaluation of various Board Committees constitutedunder Companies Act & Listing Regulations was made on the basis of their respectiveterms of reference discharge of functions governance etc.
The separate Meeting of independent Directors was held on 07th February 2019 to reviewthe performance of Non-Independent directors including the Chairman and the Board as awhole as per Code of Independent Directors under Companies Act 2013 and ListingRegulations. The Independent Directors also reviewed the quality content and timelinessof follow of information between Management and the Board.
The Performance Evaluation Policy of Board of Directors is uploaded on the Company'swebsite i.e. www. winsometextile.com under corporate policies.
The Board has on the recommendation of the Nomination and Remuneration Committeeframed a policy for selection and appointment of Directors Key Managerial PersonnelSenior Management and their Remuneration. The said policy has been uploaded on the websiteof the Company. The Key provisions of Nomination and Remuneration policy are appended asan Annexure I to the Board's report.
The company has duly constituted an Audit Committee the scope of which is quitecomprehensive and is in conformity with the provisions of the Companies Act 2013 andListing Regulations. The composition of the Audit Committee is given in CorporateGovernance Report.
All the recommendations of the Audit Committee were accepted by the Board.
DETAILS OF ESTABLISHMENT OF VIGIL MECHANISM / WHISTLE BLOWER POLICY
The Company has adopted the Whistle Blower Policy/Vigil mechanism for directors andemployees to report concerns about unethical behavior actual or suspected fraud orviolation of the Company's Code of Conduct and Ethics. Such mechanism/policy is alsouploaded on the website of the Company i.e. www. winsometextile.com under the head"corporate policies".
M/s B. Chhawchharia & Co. Chartered Accountants were appointed as StatutoryAuditors of Company for a period of five consecutive years at the 36th Annual GeneralMeeting of Company held on 04th September
2017 on a remuneration mutually agreed upon between the Board of Directors and theStatutory Auditors. Their appointment was subject to ratification by the Members at everysubsequent AGM held after the AGM held on 04th September 2017. Pursuant to the amendmentsmade to Section 139 of the Companies Act 2013 by the Companies (Amendment) Act 2017effective from May 7 2018 the requirement of seeking ratification of the Members for theappointment of the Statutory Auditors has been withdrawn and such variation in the termsof appointment have also been approved by the shareholders in the AGM held on 24thSeptember
2018. Hence the resolution seeking ratification by Members for continuance of theirappointment at this
AGM is not being sought.
The auditor's report is self-explanatory and requires no explanation.
COST AUDIT & AUDITORS
M/s Aggarwal Vimal & Associates Cost Accountants were appointed as Cost Auditorsof your Company for auditing the cost accounts records for the financial year 2018-19under provisions of Section 148 of the Companies Act 2013. They are likely to submit CostAudit Report within the prescribed time limit. Further the Company has made and maintainedproper cost records as specified by the central government under sub-section (1) ofsection 148 of the Companies Act 2013 for its business activities carried out during theyear.
Furthermore the Board has re-appointed M/s Aggarwal Vimal & Associates CostAccountants as Cost Auditors of the Company for the financial year 2019-20 on aremuneration of Rs.75000/- (Rupees Seventy Five Thousand only) same as in the previousyear. The Company has received written confirmation(s) from M/s Aggarwal Vimal &Associates Cost Accountants to the effect that their appointment if made would be inaccordance of provisions of section 148 of Companies Act 2013 and that they are notdisqualified for such appointment within the meaning of section 141 of Companies Act 2013read with Companies (Audit & Auditors) Rules 2014.
SECRETARIAL AUDIT & AUDITORS
Shri Ramesh Bhatia Practicing Company Secretary was appointed to conduct thesecretarial audit of the Company for the financial year 2018-19 as required under Section204 of the Companies Act 2013 and Rules made there under. The secretarial audit reportfor FY 2018-19 is appended as an Annexure II to the Board's report. The Secretarialauditors' report for the year under review contain no adverse remarks qualificationshence no comments required.
Furthermore the Board has re-appointed Shri Ramesh Bhatia Practicing CompanySecretary as secretarial auditor of the Company for the financial year 2019-20.
PARTICULARS OF CONTRACTS OR ARRANGEMENTS MADE WITH RELATED PARTIES
All Related Party transactions entered during the financial year were on arm's lengthbasis and in the ordinary course of business. There were no materially significant relatedparty transactions with the Company's Promoters Directors Management or their relativeswhich could have had a potential conflict with the interests of the Company. Transactionswith related parties entered by the Company in the normal course of business areperiodically placed before the Audit Committee for its review/approval. There was nomaterial contract or arrangement or transactions with Related Party during the year. Thusdisclosure in form AOC-2 is not required.
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 therules there under and Listing Regulations. This Policy as considered and approved by theBoard has been uploaded on the website of the Company at web linkhttp://www.winsometextile.com/files/pdf/68-63-file.pdf.
PARTICULARS OF EMPLOYEES
The information under Section 197 read with Rule 5(1) 5(2) & 5(3) of Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 is appended as anAnnexure III & Annexure IV to the Board Report.
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 Act is annexed as an Annexure V which forms an integral part ofthis Report and is also available on the Company's website at www.hwinsometextile.com.
The company maintained healthy cordial and harmonious industrial relations at alllevels.
DEVELOPMENT AND IMPLEMENTATION OF A RISK MANAGEMENT POLICY
The Company has been addressing various risks through well-defined risk managementpolicy/procedures which in the opinion of the Board may threaten the existence of theCompany. The Company has in place a mechanism to inform the Board about the riskassessment and minimization procedures and periodical review to ensure that managementcontrols risk through means of a properly defined framework.
The Company has formulated and adopted Risk Management Policy to prescribe riskassessment management reporting and disclosure requirements of the Company. The saidpolicy is available on the website of the Company i.e. www.winsometextile.com.
INTERNAL FINANCIAL CONTROL SYSTEMS
The Company has laid down adequate internal financial controls with reference tofinancial statements. During the year such controls were tested and no material weaknessin their operating effectiveness was observed.
Further the Company has an adequate system of internal control system in placecommensurate with its size and operations. It ensures that all transactions areauthorized recorded and reported correctly. To maintain its objectivity and independencean in-house Internal Audit Department of Company continuously monitors and evaluates theefficacy and adequacy of internal control system in the Company its compliance withoperating system accounting procedures and policies/SOP's at all the location of theCompany. Significant audit observation and corrective actions thereon are presented toAudit Committee. The Audit Committee regularly reviews the reports submitted by InternalAudit Department.
ASSOCIATES AND SUBSIDIARIES
The Company has no Associates & Subsidiaries as on March 31 2019.
The Company has got approval to open branch office in Poland from the respectiveauthorities in the F.Y. 2017-18. The said branch is in operational since second quarter ofF.Y. 2018-19 and catering to textile market in central Europe.
CORPORATE GOVERNANCE AND COMPLIANCE WITH SECRETARIAL STANDARDS
As per the provisions of Listing Regulations a separate Report on Corporate Governancepractices followed by the Company together with a Certificate from the Practicing CompanySecretary confirming compliance forms part of this report. Furthermore the Company hascomplied with Secretarial Standards issued by Institute of Company Secretaries of India onBoard Meetings and General Meetings.
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION FOREIGN EXCHANGE EARNING AND OUTGO
As required under Section 134(3)(m) of the Companies Act 2013 read with Rule 8 ofCompanies (Accounts) Rules 2014 the particulars relating to conservation of energytechnology absorption and foreign exchange earnings and outgo is appended as an AnnexureVI to the Board's Report.
CORPORATE SOCIAL RESPONSIBILITY (CSR)
It is the Company's intent to establish itself and remain as a responsible corporateentity conscious of its social responsibilities towards its work force society andenvironment. Corporate Social Responsibility (CSR) policy is framed under provisions ofSection 135 of Companies Act 2013 & rules made there under having following majorobjectives:
To identify and formulate projects and areas in response to the needs of societyand to implement them with full involvement and commitment in a time bound manner.
To adopt an approach that aims at achieving a greater balance between social andeconomic development.
To implement CSR Activities/CSR programmes primarily in the economic vicinityCompany's operations with a view to ensuring the long term sustainability of suchinterventions.
Contribution to the society at large by way of socio-economic activities andsocial awareness ensuring that benefits reach the targeted beneficiaries.
To comply with the requirements of Companies Act and all other applicable ActsRules Regulations framed by the Government time to time.
The CSR activities are focused not just around units/plants and offices of the Companybut also in other geographies based on the needs of the communities/society. In pursuanceto CSR Policy Company has decided to conduct or undertake all or any of prescribedactivities/activity/sub-activity as mentioned in Schedule VII of the Companies Act 2013and rules & regulations made there under (as amended time to time) ether directly orthrough Winsome Textile Social Trust. Winsome Textile Social Trust established by Companyfor carrying out CSR activities of the Company including utilization of CSR Funds ofCompany as per the provisions of section 135 and Schedule VII of the Companies Act 2013and rules made there under as amended from time to time and which also fulfills thecriteria laid down under Companies (CSR Policy) Rules 2014. The Corporate SocialResponsibility (CSR) Committee of Company regularly monitor/review the CSR activities/CSRprojects its mechanism & other prescribed activities/matters. CSR policy is availableon website of Company at weblink: http://www.winsometextile.com/files/pdf/68-59-file.pdf.
ANNUAL REPORT ON CORPORATE SOCIAL RESPONSIBILITY [CSR] ACTIVITIES IS APPENDED AS ANANNEXURE VII DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTSOR TRIBUNALS IMPACTING THE GOING CONCERN STATUS AND COMPANY'S OPERATIONS IN FUTURE
There were no significant and material orders passed by the Regulators or Courts orTribunals impacting the going concern status and Company's operations.
DIRECTOR'S RESPONSIBILITY STATEMENT
Pursuant to the provisions of section 134(3Xc) and 134(5) of Companies Act 2013 it ishereby confirmed that:
in the preparation of annual accounts for the financial year ended 31st March2019 the applicable accounting standards have been followed and that there are nomaterial departures;
the Directors have selected such accounting policies and applied themconsistently and made judgements and estimates that were reasonable and prudent so as togive a true and fair view of the state of affairs of the Company as at 31st March 2019and of the profit or loss of the Company for the year ended on that date;
the Directors have taken proper and sufficient 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 fraud andother irregularities;
the annual accounts have been prepared on a going concern basis;
the Directors have laid down internal financial controls to be followed by thecompany and that such internal financial controls are adequate and are operatingeffectively;
the Directors have devised proper systems to ensure compliance with theprovisions of all applicable laws and that such systems are adequately and operatingeffectively.
DECLARATION BY INDEPENDENT DIRECTORS
All Independent Directors of the Company have submitted the Declaration ofIndependence as required pursuant to provisions of section 149 of Companies Act 2013 andunder Listing Regulations stating that they meet the criteria of independence as providedin said section/relevant regulation.
None of the Directors of Company are disqualified under the provisions of section 164of Companies Act 2013 & rules made there under. The Directors have made the requisitedisclosures as required under the Companies Act 2013 and SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 ("hereinafter referred to as ListingRegulations").
INTERNAL COMPLAINT COMMITTEE (ICC)
The Company has constituted an internal Complaint Committee (ICC) in all units of thecompany including corporate office to consider and resolve all sexual harassmentcomplaints reported by any employees of the Company. The constitution of ICC is as per theSexual Harassment of Women at Workplace (Prevention Prohibition and Redressal) Act 2013and the committee includes external members from NGOs or with relevant experience.Investigation is conducted and decisions made by ICC at respective location and seniorwoman employee is the presiding officer over every case. Half of the total members of ICCare women. The details of complaints pertaining to sexual harassment that were fileddisposed of and pending during the financial year are provided in the corporate governancereport of this Annual Report.
MATERIAL CHANGES FROM END OF FINANCIAL YEAR TILL DATE OF REPORT
There are no material changes and commitments affecting the financial position of theCompany which occurred between the end of the financial year to which this financialstatements relate and the date of this Report.
DISCLOSURE REGARDING VOTING RIGHT NOT EXERCISED DIRECTLY BY THE EMPLOYEES
During the year under review there is NIL disclosure as required under provisions ofsection 67 of Companies Act 2013.
No disclosure or reporting is made in respect of the following items as there were notransactions during the year under review:
There was no instance of fraud during the year under review which required theStatutory Auditors to report to the Audit Committee and / or the Board under Section143(12) of Act and Rules framed thereunder.
Neither there is revision in the Financial Statements nor there is any change innature of business. EQUAL OPPORTUNITY EMPLOYER
Company has always provided a congenial atmosphere for work to all employees that isfree from discrimination and harassment including sexual harassment. It has provided equalopportunities to all employees workers without regard to their caste creed colourmarital status and sex.
MANAGEMENT DISCUSSION AND ANALYSIS REPORT
Management discussion and analysis report as required by Listing Regulations formspart of the Annual Report.
The Directors take this opportunity to express their deep sense of gratitude to theCustomers stakeholders Central and State Governments for their continued guidance andsupport. Your Directors wish to place on record their appreciation for the supportdedication and hard work put in by every member of WINSOME Family.
| ||For and on behalf of the Board |
| ||Sd/ |
| ||(Ashish Bagrodia) |
|Place: Chandigarh ||Chairman & Managing Director |
|Date: 21.05.2019 ||DIN-00047021 |