DIRECTORS' REPORT TO THE MEMBERS, Your Directors are pleased to présent herewith Twenty Fourth Annual Report together with the Audited Statements of Accounts of the Company for the year ended 31st March, 2016. DIVIDEND Due to loss of Rs. 1253.26 Lakhs in the year, your Directors regret their inability to recommend any dividend for financial year 2015-16. DEPOSITS The Company has not accepted any deposits, described under Chapter V of the Companies Act, 2013 from public during the period under report. MANAGEMENT DISCUSSION AND ANALYSIS Pursuant to Regulation 18 (3), sub-regulation B of Schedule V of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, management discussion and analysis report of financial condition and result of operations has been reviewed by the audit committee and the same is forming part of this annual report. CONSOLIDATION OF FINANCIAL STATEMENTS The Consolidated Financial Statements have been prepared in accordance with the provisions of the Act, read with the Companies (Accounts) Rules, 2014, applicable Accounting Standards and the provisions of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, and forms part of the Annual Report. REVISION IN FINANCIAL STATEMENTS There has been no revision in the financial statements of the Company during the financial year 2015-16. SUBSIDIARY AND ASSOCIATES COMPANIES The following may be read in conjunction with the Consolidated Financial Statements prepared in accordance with Accounting Standard 21. Shareholders desirous of obtaining the report and accounts of your Company's subsidiaries may obtain the same upon request. Consolidated Financial Statement presented by the Company includes financial information of subsidiary companies, which forms a part of the Annual Report. During the year, no company became or ceased to be your Company's subsidiary, joint venture or associate company. The Policy for determining Material Subsidiaries, adopted by your Board, in conformity with SEBI (Listing Obligations and Disclosu DIRECTORS Your Company has Six (06) Directors consisting of Four (4) Independent Directors and a Chairman & Managing Director and Executive Director & Chief Financial Officer as on March 31, 2016. The composition of the Board, meetings of the Board held during the year and the attendance of the Directors have been mentioned in the Report on Corporate Governance in the Annual Report. NUMBER OF MEETINGS OF THE BOARD Regular meetings of the Board are held to discuss and decide on various business policies, strategies and other businesses. Due to business exigencies, certain business decisions are taken by the Board through circulation from time to time. The Board met six (6) times during the FY 2015-16 viz. on May 25, 2015, July 25, 2015, August 29, 2015, August 31, 2015, November 14, 2015 and February 13, 2016. Detailed information on the meetings of the Board is included in the report on Corporate Governance, which forms part of this Annual Report. Additionally, several committee meetings were held including Audit Committee meeting, which met Four (4) times during the year. DECLARATION BY INDEPENDENT DIRECTORS The Company has received necessary declaration from each independent director under section 149(6) of the Companies Act, 2013 that he/she meets the criteria of Independence laid down in Section 149 (6) of the Companies Act, 2013. Following are the Non-Executive Independent Directors: 1. Shri. Manoj P. Unadkat 2. Shri. Vijay P. Panikar 3. Shri. Arvind M. Shah 4. Smt. Rajeshri D. Patel MEETING OF INDEPENDENT DIRECTORS According to regulation 25 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, all the independent directors met on Tuesday, June 16, 2015 to review the performance of non-independent and non-executive directors. APPOINTMENTS/RESIGNATIONS FROM THE BOARD OF DIRECTORS Shri. Rajendra G. Parikh (DIN No: 00496747), Chairman and Managing Director, retire from office by rotation and being eligible offer himself for reappointment at the forthcoming Annual General Meeting of the Company. Pursuant to the provisions of Section 203 of the Companies Act, 2013 read with Rule 8 of the Companies (Appointment And Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed Mr. Surendra C Gurav as Executive Director & Chief Financial Officer of the Company in Board Meeting dated February 13, 2016 with effect from March 01, 2016. KEY MANAGERIAL PERSONNEL Pursuant to Sections 196, 197 and other applicable provisions of the Companies Act, 2013, your Directors have appointment Mr. Surendra C Gurav (00485016) as Executive Director & Chief Financial Officer of the Company from March 01, 2016 for five consecutive years. As required under Section 203 of the Companies Act, 2013, the Company has noted that Mr. Rajendra G Parikh, Chairman and Managing Director, Mr. Surendra C Gurav, Executive Director and Chief Financial Officer and Mrs. Kirti J Damle, Company Secretary are the Key Managerial Personnel of the Company. FAMILARIZATION PROGRAMME The Company at its various meetings held during the Financial year 2015-16 had familiarize the Independent Directors with regard to the roles, rights, responsibilities in the Company, nature of the industry in which the Company operates, the Business models of the Company etc. The Independent Directors have been provided with necessary documents, reports and internal policies to familiarize them with the Company's policies, procedures and practices. COMMENT ON AUDITOR'S REPORT The Directors have examined the Auditor's Report on accounts for the period ended 31st March, 2016. The Auditor's Report is self-explanatory and has no qualification. COMMENT ON SECRETARIAL AUDIT REPORT Pursuant to provisions of section 204 of the companies Act, 2013, the Board of Directors of the Company has appointed M/s. Dhirendra Maurya & Associates, Company Secretaries, as the Sectetarial Auditor. The auditor has conducted the secretarial Audit for the financial year 2015-16 and has provided the Report thereon. There are no qualifications in the secretarial Audit Report. Further, the Auditor has mentioned in his report that annual filing for the year 2013-14 of the Company is pending. It is due to non-availability of E-forms on the MCA site. As soon as the forms are available on the MCA site, the Company will complete the filing for the above mentioned financial year. PARTICULAR OF LOAN AND INVESTMENT The Company has not taken any loan or guarantee and not done any investments in the F.Y. 31st March, 2016. RISK MANAGEMENT During the Financial Year under review, a detailed exercise on Business Risk Management was carried out covering the entire spectrum of business operations and the Board has been informed about the risk assessment and minimization procedures as required under section 134 (n) of the Companies Act, 2013. Business risk evaluation and management is an ongoing process with the Company. MATERIAL CHANGES AND COMMITMENT IF ANY AFFECTING THE FINANCIAL POSITION OF THE COM PANY No material changes and commitments affecting the Financial Position of the Company which have occurred between the end of the Financial year of the Company to which the Financial Statement relate and the date of this report. INTERNAL CONTROL SYSTEM AND THEIR ADEQUACY The Company has an Internal Control System, commensurate with the size, scale and complexity of its operations. Based on the report of Internal Audit function, corrective actions are undertaken in the respective areas and thereby strengthen the controls. Significant audit observations and corrective actions thereon are presented to the Audit Committee of the Board. During the year under review, no material or serious observation has been received from the Internal Auditors of the Company for inefficiency or inadequacy of such controls. CORPORATE SOCIAL RESPONSIBILITY (CSR) The Company is not required to constitute a Corporate Social Responsibility Committee as it does not fall within the purview of Section 135(1) of the Companies Act, 2013 and hence it is not required to formulate policy on corporate social responsibility. CONTRACT AND ARRANGEMENT WITH RELATED PARTIES The particulars of related party transactions are stated in the note no.7 in Part B of Notes financial statements of this report. All related party transactions that were entered into during the financial year were on an arm's length basis and were in the ordinary course of business of the Company. There are no materially significant related party transactions made by the Company with its Promoters, Directors, Key Managerial Personnel or other designated persons which may have a potential conflict with the interest of the Company at large, and hence, discloure in form AOC-2 is not required. The Related Party Transactions Policy of the Company approved by the Board of Directors of the Company (the "Board") is displayed on website of the Company at www.jik.co.in COMMITTEES OF THE BOARD The Company has several committees which have been established as a part of the good corporate governance practices and are in compliance with the requirements of the relevant provisions of applicable laws and statutes. Company has following Committees of the Board Audit Committee Nomination and Remuneration Committee Stakeholder Relationship Committee Committee of Independent Directors BOARD EVALUATION In Compliance with the provisions of the Act, the Board evaluated its own performance during the year under report along with that of its various Committees and its individual Directors. The Independent Directors also reviewed the performance of the Non-Independent Directors of the Company. REMUNERATION POLICY The Board of Directors of the Company has adopted a Remuneration Policy for determining qualifications, positive attributes and independence of a Director and criteria for Director's appointment and remuneration. The same is available on the website of the Company www.jik.co.in REMUNERATION FOR THE CEO AND MANAGING DIRECTOR Mr. Rajendra G Parikh, Chairman and Managing Director of the Company have not drawn any remuneration during the period ended March 31, 2016. CORPORATE GOVERNANCE As required by Schedule V(C) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, a detailed report on Corporate Governance is given as a part of the Annual Report. The Company is in compliance with the requirements and disclosures that have to be made in this regard. The Auditors' Certificate of the compliance with Corporate Governance requirements by the Company is attached to the Report on Corporate Governance. WHISTLEBLOWER POLICY The Company's Whistleblower Policy encourages Directors and employees to bring to the Company's attention, instances of unethical behavior, actual or suspected incidents of fraud or violation of the JIK Code of Conduct that could adversely impact the Company's operations, business performance and / or reputation. The Policy provides that the Company investigates such incidents, when reported, in an impartial manner and takes appropriate action to ensure that the requisite standards of professional and ethical conduct are always upheld. It is the Company's Policy to ensure that no employee is victimized or harassed for bringing such incidents to the attention of the Company. The practice of the Whistleblower Policy is overseen by the Audit Committee of the Board and no employee has been denied access to the Committee. The Whistleblower Policy is available on the Company's corporate website www.jik.co.in SEXUAL HARRASEMENT POLICY The Company is an equal employment opportunity company and is committed to create a healthy working environment that enables employees to work without fear of prejudice, gender bias and sexual harassment. The Company also believes that all employees of the Company have the right to be treated with dignity. The Company has in place a policy on prevention of sexual harassment of its employees at the workplace. The Sexual Harassment Policy is available on the Company's website www.jik.co.in CODE OF CONDUCT The Board had laid down a code of conduct for all Board members and senior management of the Company. The Code of Conduct has been hosted on the website (www.jik.co.in) of the Company. The Board members and senior management personnel have affirmed compliance with the Code of Conduct of the Company in the year under review. POLICY FOR DETERMINING MATERIALITY FOR DISCLOSURES As per the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the policy on determination on materiality of events has been approved by the Board of Directors in its meeting held on February 13, 2016. This policy is also available on the website of the Company: www.jik.co.in POLICY ON PRESERVATION OF DOCUMENTS As per the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the policy on preservation of documents has been approved by the Board of Directors in its meeting held on February 13, 2016. This policy is also available on the website of the Company: www.jik.co.in AUDITORS The Auditors, M/s. Motilal & Associates., Chartered Accountants, were appointed with your approval at the 22rd AGM to hold such office till the conclusion of the 25th AGM. The Board, in terms of Section 139 of the Act, on the recommendation of the Audit Committee, has recommended for the ratification of the Members the appointment of M/s. Motilal & Associates., Chartered Accountants from the conclusion of the ensuing AGM till the conclusion of the 24m AGM. M/s Motilal & Associates Chartered Accountants have confirmed to the Company that their appointment satisfies the criteria prescribed in section 141 of the Act and are not disqualified to be re-appointed. SECRETARIAL AUDIT REPORT As a measure of good corporate governance practice, the Board of Directors of the Company appointed M/s Dhirendra Maurya & Associates, Practicing Company Secretary, to conduct the Secretarial Audit. The Secretarial Audit Report for the financial year ended March 31, 2016, is provided as Annexure B to the Directors' Report. EXTRACT OF ANNUAL RETURN The information required under Section 134 of the Act read with Rule 12 of the Companies (Management and Administration) Rules, 2014, is annexed as Annexure A. REVIVIAL AND REHABILITATION As the Company's net worth has been completely eroded as on March 31, 2015, the company has become a Sick Industrial Company in terms of the Sick Industrial Companies (Special Provision) Act, 1985. A reference in respect of the same has been filed with the Board for Industrial and Financial Reconstruction as per the provision of Section 15 of the Sick Industrial Companies (Special Provision) Act, 1985 & the same has been registered by the Board. Further, Operating Agency (OA) has been appointed by the Board. As a part of modernizing its manufacturing operations, the Company has decided to give greater focus on better margin cold room activities and partially outsource hot room activities and is in process to carry out necessary changes to modernize and improve the manufacturing activities. Management is under process to incur capex towards refurbishment of plant and machinery as required and to replace the machinery with improved technology. The Company is in the process of finding solutions to unlock the value. The Company is expanding into Handicrafts, Arts, Eco-Friendly Products and hotel supply & glass jewellery business. The Company is considering demerger for certain activities which will support in rehabilitation and value addition including but not limited to restructuring of the capital. PARTICULARS OF EMPLOYEE The Managing Director of the Company has not drawn remuneration in the F.Y. 2016. The Remuneration of Key Managerial Personnel is one level above the median of employees' remuneration. The information required under Section 197(12) of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are as under: A statement showing the details of every employee of the Company who was in receipt of remuneration in excess of Rs. 60 lakhs, if employed throughout the year - N.A. Percentage increase in remuneration of each director, KMP and of % increase in median remuneration of employees - N.A. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNING & OUTGO Particulars as required under Section 134 of the Companies Act, 2013 relating to Conservation of Energy and Technology Absorption are also provided in the Annexure to this Report as Annexure C. DIRECTORS' RESPONSIBILITY STATEMENT As required under Section 134 of the Companies Act, 2013, your Directors confirm having: (a) in the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures; (b) the directors had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the company at the end of the financial year and of the profit and loss of the company for that period; (c) the directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities; (d) the directors had prepared the annual accounts on a going concern basis; and (e) the directors, in the case of a listed company, had laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively. (f) the directors, had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively. CASH FLOW STATEMENT In conformity with the Regulation 53 (b) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Cash Flow Statement for the financial year ended 31st March, 2016 is annexed herewith. DEMATERIALISATION OF SHARES The Shares of the Company have been admitted in dematerialized form for trading by the National Securities Depository Limited (NSDL) and the Central Depository Services (India) Limited (CDSL) under the ISIN: INE026B01049 and they are compulsorily traded in dematerialized form. As on 31st March, 2016 a total of 71362339 equity shares of the Company, which form 98.24% of the equity share capital, stand dematerialized. LISTING OF SECURITIES OF COMPANY The equity shares of your Company continue to be listed on The Bombay Stock Exchange Limited and the National Stock Exchange of India Limited. The Annual Listing Fees are paid. ACKNOWLEDGEMENT Your Directors wish to acknowledge all their stakeholders and are grateful for the excellent support received from the Shareholders, Government authorities, esteemed clients, customers and other business associates. Your Directors recognise and appreciate the hard work and efforts put in by all the employees of the Company in a very challenging environment. For and on behalf of the Board Rajendra G. Parikh Chairman & Managing Director Dated: July 01, 2016 Place: Thane |