DIRECTORS’ REPORT To, The Members, Your Directors have pleasure in presenting their 23rd Annual Report on the business and operations of the Company and the accounts for the Financial Year ended March 31, 2015. DIVIDEND In view of the losses for the year ended March 31, 2015, the Board of Directors of your Company do not recommend dividend for the year. RESERVES As on March 31, 2015 the reserves and surplus stood at Rs. 1773.83 lac as compared to Rs. 3066.50 in the previous year. COMPANY'S WORKING DURING THE YEAR During the year the Company earned total income of Rs. 8883.25 lacs as compared to Rs. 10343.03 earned in the previous year showing a reduction of 14%. The operations during the year has resulted in a loss of Rs. 1291.27 lacs. INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THE FINANCIAL STATEMENTS The Company has an Internal Control System, commensurate with the size, scale and complexity of its operations. To maintain its objectivity and independence, the Internal Audit function reports to the Chairman of the Audit Committee of the Board. The Internal Audit Department forming part of Accounts Department monitors and evaluates the efficacy and adequacy of internal control system in the Company, its compliance with operating systems, accounting procedures and policies at all locations of the Company. Based on the report of internal audit; owners undertake corrective action in their respective areas and thereby strengthen the controls. SUBSIDIARY / JOINT VENTURES / ASSOCIATE COMPANIES As on the date of Balance Sheet, the Company has one subsidiary viz. Rishi Consfab Private Limited. PERFORMANCE AND FINANCIAL POSITION OF THE SUBSIDIARY INCLUDED IN THE CONSOLIDATED FINANCIAL STATEMENT The details of the financial position of the Subsidiary included in the consolidated financial statement is annexed herewith as Annexure 'A' in Form AOC-1. DEPOSITS During the year under report, the Company has not accepted deposits from public under Chapter V of the Act. STATUTORY AUDITORS M/s. Alladi Krishnan & Kumar, Chartered Accountants, Statutory Auditors of the Company (Firm Registration No. 100282W) retire and offer themselves for re-appointment. The Company has obtained the requisite certificate required under Section 139 of the Companies Act, 2013 to the effect that their re-appointment, if made, will be in conformity with the limits specified in the said section and the criteria stipulated under section 141 of the Companies Act 2013. As per the provisions of the Companies Act, 2013, the Auditors Report forms part of Annual Report. SHARE CAPITAL The paid up Equity Share Capital as on March 31, 2015 was Rs. 919.26 Lacs. As on March 31, 2015, following two directors are holding shares of the Company: Mr. Harshad Patel Mr. Dinesh Mehta EXTRACT OF THE ANNUAL RETURN The details forming part of the extract of the Annual Return in Form MGT 9 is annexed herewith as Annexure 'B'. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO The information required to be disclosed is set out in Annexure 'C'. DIRECTORS: A. Changes in Directors and Key Managerial Personnel Mr. Jayesh Sheth, Director of the Company resigned with effect from 01.12.2014. The Board of the Company comprise of three directors viz. Mr. Harshad Patel, Managing Director and two other Independent Directors. B. Declaration by an Independent Director(s) All Independent Directors have given declarations that they meet the criteria of independence as laid down under Section 149(6) of the Companies Act, 2013 and Clause 49 of the Listing Agreement. C. Formal Annual Evaluation Pursuant to the provisions of the Companies Act, 2013 and Clause 49 of the Listing Agreement, the Board has carried out an annual performance evaluation of its own performance, the directors individually as well as the evaluation of the working of its Audit, Nomination & Remuneration and Compliance Committees. The manner in which the evaluation has been carried out has been explained in the Corporate Governance Report. MEETINGS OF THE BOARD OF DIRECTORS During the year, in all seven Board Meetings were held i.e. on 14th April, 2014; 29th May, 2014; 13th August, 2014; 11th November, 2014; 19th December, 2014; 10th February, 2015 and 23rd March, 2015. The time gap between any two meetings was not more than 120 days. The details of Directors and their attendance record at Board Meetings held during the year and at the last Annual General Meeting, number of other directorships and chairmanships/memberships of committees, and other Committees of the Company is given in Corporate Governance Report. AUDIT COMMITTEE The Company has a Qualified Audit Committee as per the provisions of the Companies Act, 2013 and Listing Agreement with Stock Exchange. The necessary details in this regard form part of Corporate Governance Report. VIGIL MECHANISM FOR DIRECTORS AND EMPLOYEES The Company formulated Whistle Blower Policy as per the provisions of Clause 49 of the Listing Agreement to raise any complaint, query and to deal with instance of fraud and mismanagement, if any. The details of the said policy are explained in the Corporate Governance Report and circulated to the employees internally. NOMINATION & REMUNERATION COMMITTEE The Company has a Nomination & Remuneration Committee as per the provisions of the Companies Act, 2013 and Listing Agreement with Stock Exchange. The necessary details in this regard form part of Corporate Governance Report. LOANS, GUARANTEES OR INVESTMENTS UNDER SECTION 186 CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES Details of Loans, Guarantees and Investments covered under the provisions of Section 186 of the Companies Act, 2013 are given in the notes to the Financial Statements. PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES 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. There are no materially significant related party transactions made by the Company with Promoters, Directors, Key Managerial Personnel or other designated persons which may have a potential conflict with the interest of the Company at large. Pursuant to Section 134 read with rule of the Companies (Accounts) Rules 2014, there are no transactions to be reported under section 188(1) of the Companies act, 2013. The related party policy as approved by the Board is available on the website of the Company. The disclosure in Form AOC-2 as per the provisions of Section 188 of the Companies Act, 2013 and rules mad there under is not required since there are no material contracts or arrangements entered into by the Company as per the Policy of Materiality framed forming part of Related Party Transaction policy of the Company. Related Party Transactions as required under Accounting Standards are reported under the notes to the financial statements. PARTICULARS OF EMPLOYEES -MANAGERIAL REMUNERATION The statement containing particulars of employees as required and the ratio of remuneration of Managing Director to the median employees' remuneration and other details in terms of Section 197 (12) of the Companies Act, 2013 read with Rule 5 (1) and (2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 forms part of this report as "Annexure D". SECRETARIAL AUDIT REPORT 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 has appointed Sudhanwa S. Kalamkar & Associates, Company Secretary in practice to undertake the Secretarial Audit of the Company. The Report of the Secretarial Auditor is annexed herewith as "Annexure E". EMPLOYEE STOCK OPTION PLAN The Details required to be provided under the Securities and Exchange Board of India (Employee Stock Option Scheme) Guidelines, 1999 and Securities Exchange Board of India (Share Based Employee Benefits) Regulations, 2014, Section 62(1) (b) of the Companies Act, 2013 read with Rule 12(9) of the Companies (Share Capital and Debentures) Rules, 2014 are provided in Annexure 'F'. RISK MANAGEMENT POLICY The Company has developed a very comprehensive risk management policy under which all key risks and mitigation plans are compiled into a Risk Matrix. The same is reviewed quarterly by senior management and periodically also by the Risk Management Committee of the Board. CORPORATE SOCIAL RESPONSIBILITY POLICY (CSR) CSR Policy is not applicable to the Company. STATEMENT ON SALIENT FEATURES OF FINANCIAL STATEMENT Statement on salient features of Financial Statement in Form AOC-3 is not required since Entire Annual Report is being sent to all Shareholders in the manner specified under Rule 11 of the Companies (Accounts) Rules, 2014. DIRECTORS' RESPONSIBILITY STATEMENT The Directors' Responsibility Statement referred to in clause (c) of sub-section (3) of Section 134 of the Companies Act, 2013, shall state that— (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, 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. MANAGEMENT DISCUSSION AND ANALYSIS The Management Discussion and Analysis on the operations of the Company is provided in a separate section and forms a part of the Annual Report. CORPORATE GOVERNANCE REPORT Report on Corporate Governance as stipulated in Clause 49 of the Listing Agreement with the Stock exchanges, is provided in a separate section and forms part of the Annual Report. CORPORATE GOVERNANCE CERTIFICATE The Compliance certificate from the auditors regarding compliance of conditions of corporate governance as stipulated in Clause 49 of the Listing agreement is annexed to the Corporate Governance Report forming part of Annual Report. ACKNOWLEDGEMENTS The Directors place on record their appreciation of the efficient and loyal services rendered by the Staff and workmen as also help and guidance received from Canara Bank. On behalf of Board of Directors Harshad B. Patel Chairman & Managing Director Place : Mumbai Date : 29th May, 2015 |