IIT Investrust Limited

DIRECTORS' REPORT

The Members

MOHIT INDUSTRIES LIMITED

Your Directors have pleasure in presenting the 26th annual Report together with the Audited Financial Statements for the year ended 31st March, 2016.

1. DIVIDEND

Your Directors are pleased to recommend a dividend of 10% i.e. Rs. 1 per equity share of face value of Rs. 10 each aggregating to 141.57 lacs. During the year under review, no amount from profit was transferred to General Reserve.

2. SHARE CAPITAL

The Paid up equity share capital as on March 31, 2016 was Rs. 1415.76 Lacs. During the year under review, the Company has neither issued any shares/convertible warrant nor has granted any stock options and nor sweat equity.

3. DEMERGER OF AAC BLOCK DIVISION OF MOHIT INDUSTRIES LTD INTO BIGBLOC CONSTRUCTION LTD

The Hon'ble high court ofGujarat has, vide its order dated 22nd February, 2016 sanctioned the Scheme of Arrangement and Demerger between Mohit Industries Limited ("Demerged company') and Bigbloc Construction Limited ("Resulting company') and their respective Shareholders and Creditors under Section 391 to 394 of the Companies Act 1956. With effect from appointed date i.e. Olst April, 2015,all the assets and liabilities of AAC Block Division of the company becomes assets & liabilities of Bigbloc Construction Limited ("BCL"). In Consideration of vesting of AAC Block division of the company to BCL as per terms of the Scheme, each shareholder of Company in respect of each share held in the company, has been allotted, one share each of BCL of face value of Rs. 10/- each as fully paid up.

4. BUSINESS DEVELOPMENT & EXPANSION

Your company has 16 Texturising Machines, 150 High Speed Shuttle-less Looms and 144 Conventional Shuttle Looms with a capacity to manufacture 21,000 tonnes of Draw Texturised Yarn (DTY) per annum and 12 Million meters Grey fabrics per annum respectively. Now the company is planning to install 8 new texturising Machines having thereby increasing manufacturing capacity by 40 % i.e. 9000 tonnes of Draw Texturised Yarn (DTY) per annum and making total manufacturing capacity of 30,000 tonnes of DTY per annum. Construction of new building for expansion of textile division of company at Kim, surat is going on.

5. EXPORT

The Company has exported DTY Yarn to South Korea with a Premium and in its Brand Name toThailand, Czech Republic, Denmark, Germany, Bulgaria, Indonesia, United Kingdo, Mexico, Brazil, Guatemala, Vietnam and many more Countries. The Company has availed Export House Status. The total Net exports of the Company amounted to Rs. 5584 Lacs as compared to Rs. 8806.76 Lacs. During the year export of the company get affected due to decrease in crude oil prices, which eventually resulted, fall in price of raw material and finished goods prices and this decrease in crude oil prices also affected the demand for the products. Your company also holds Certificate of Oeko-Tex® Standard 100.

6. CONSOLIDATED FINANCIAL STATEMENTS

The Consolidated Financial Statements of Mohit Industries Limited, its subsidiaries and its associates is prepared in accordance with AS - 21 on Consolidated Financial statements and Equity method of accounting given in AS - 23 on "Accounting of Investments in Associates in Consolidated Financial statements". The details of such subsidiary and associates are as follows:-

7. PERFORMANCE AND FINANCIAL POSITION OF EACH OF THE SUBSIDIARIES, ASSOCIATES AND JOINT VENTURE COMPANIES

The Company has one subsidiary as on March 31, 2016. There are three associate companies within the meaning of Section 2(6) of the Companies Act, 2013 ("Act") as on 31st March, 2016. Pursuant to provisions of Section 129(3) of the Companies Act, 2013 read with Rule 5 of the Companies (Accounts) Rules, 2014, a statement containing salient features of the financial statements of the Company's subsidiaries/Associate Companies and Joint Ventures is given in Form AOC-1 and forms an integral part of this Annual Report.

8. CORPORATE GOVERNANCE & MANAGEMENT DISCUSSION & ANALYSIS REPORT

As per Regulation 34 (3) read with Schedule V of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, a separate section on corporate governance practices followed by the Company, together with a certificate from Mr. Dhiren Dave, Company Secretary in practice, confirming compliance and Management Discussion Analysis Report forms an integral part of this Annual Report.

9. FIXED DEPOSITS

During the year under review the company has not accepted any deposits within the meaning of section 73 of the Companies Act, 2013 and the rules made there under.

10. DIRECTORS

In accordance with the provisions of Section 152 of the Companies Act, 2013 and the Company's Articles of Association, Mr. Manish Saboo, Director (DIN: 01576187) will retire by rotation at the ensuing Annual General Meeting and, being eligible, has offered himself for re-appointment. The company has received requisite in writing from a member proposing candidature of Mr. Harmil Jatinbhai Shah as Independent Director of the company in ensuing Annual General Meeting of the company. In terms of Section 149 of the Act it is proposed to appoint Mr. Harmil Jatinbhai shah as Independent Director for term of five years, not be liable to retire by rotation. During the financial year no changes have been occurred in the Directors of the company.

11. DECLARATION FROM INDEPENDENT DIRECTORS

The Independent Directors have submitted their declaration to the Board that they fulfill ail the requirements as stipulated in Section 149(6) of the Companies Act, 2013 read with rules framed thereunder.

12. BOARD EVALUATION

Pursuant to the provisions of the Companies Act, 2013 and the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Board has carried out the annual performance evaluation of its own performance, the Directors individually as well as the evaluation of Committees. A structured questionnaire was prepared after taking into consideration inputs received from the Nomination & Remuneration Committee members, covering various aspects of the Board's functioning such as adequacy of composition of Board and Committees, Board communication, timeliness and unbiased information of right length and quality of information, Board culture, execution and performance of specifie duties, obligations and governance.A separate exercise was carried out to evaluate the performance of individual Directors including the Chairman of the Board, who were evaluated on parameters such as attendance, participation in the discussion, deliberation at the meeting, understanding role and responsibilities as board member, demonstration of knowledge, skill and experience that make him/her a valuable resource for the board.The performance evaluation of the Independent Directors was carried out by the entire Board. The Directors expressed their satisfaction with the evaluation process.

13. NUMBER OF MEETINGS HELD

The Board met ten times during the financial year, the details of which are given in the Corporate Governance Report that forms part of this Annual Report. The intervening gap between any two meetings was within the period prescribed by the Companies Act, 2013 and the Listing Regulations.

14. POLICY ON DIRECTOR'S APPOINTMENT, REMUNERATION INCLUDING CRITERIA FOR DETERMINING QUALIFICATIONS, POSITIVE ATTRIBUTES, INDEPENDENCE OF A DIRECTORAND OTHER MATTERS

The Board has, on the recommendation of the Nomination & Remuneration Committee framed a policy for selection and appointment of Directors, Senior Management and their remuneration including criteria for determining qualifications, positive attributes and other matters provided under sub section (3) of section 178 of the Companies Act 2013. The Company's Remuneration Policy for Directors, Key Managerial Personnel and other employees is available on Company's website www.mohitindustries.com .

15. VIGIL MECHANISM / WHISTLE BLOWER POLICY

In order to ensure that the activities of the Company and its employees are conducted in a fair and transparent manner by adoption of highest standards of professionalism, honesty, integrity and ethical behavior, the Company has adopted a Vigil mechanism/Whistle Blower Policy. This policy is also posted on the Company's website www.mohitindustries.com .

16. FAMILIARISATION PROGRAMME FOR INDEPENDENT DIRECTORS

The Company has formulated a familiarization program for the Independent Directors to provide insights into the Company to enable the Independent Directors to understand its business in depth and contribute significantly to the Company. The details of such program are available on the Company's website.

18. COMPOSITION OF AUDIT AND NOMINATION & REMUNERATION COMMITTEE

The Audit Committee comprises of Mr. Sachin Jain (Chairman), Mr. Jayesh Gandhi (Member) and Mr. Narayan Saboo(Member). The Nomination and Remuneration Committee comprises of Mr. Sachin Jain (Chairman), Mr. Jayesh Gandhi (Member) and Mrs. Pragya Memani(Member). Brief details on the committee are given in the Corporate Governance Report.AII the recommendations of the audit committee are accepted by the Board.

19. DIRECTORS' RESPONSIBILITY STATEMENT

To the best of knowledge and belief and according to the information and explanations obtained by them, your Directors make the following statement in terms of Section 134(3)(c) of the Companies Act, 2013That:

a) in the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures;

b) the directors have 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 of the Company for year ended on that date;

c) the directors have 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 have prepared the annual accounts on a going concern basis; and

e) the directors have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and are operating effectively;

f) the directors have devised proper Systems to ensure compliance with the provisions of ail applicable laws and that such Systems are adequate and operating effectively.

20. STATUTORY AUDITORS

The Statutory Auditors of the Company, M/s. R.K.M &Co., Chartered Accountant, Surat (Firm Registration Number. 108553W) will retire at the conclusion of the ensuing Annual General Meeting and, being eligible; offerthem for re-appointment as Statutory Auditor for the financial year 2016-17. The Company has received a certificate from the auditors to the effect that their re-appointment if made, would be in accordance with the provisions of section 139 and 141 of the Companies Act, 2013. The Directors recommend the re-appointment of M/s R.K.M &Co. as Statutory Auditors of the Company.

AUDITORS' REPORT:

Members' attention is invited to the observation made by the Auditors under "Qualified Opinion" appearing in Auditors Reports.: The Company has not provided for Long Term Employee Benefits such as Gratuity and Leave Encashment on accrual basis but provides the same as and when they become due for payment. This method of accounting of Long Term Employee Benefits is in deviation with Accounting Standard-15 on Employee Benefits in respect of provision for Long Term Employee Benefit & Defined Benefit plans. As there is no actuariat report or basis of calculation available with the management of such long term employee benefits, the quantum of deviation cannot be determined. If the company had followed the method accounting as per AS -15, then employee benefit expense would have increased and correspondingly long term provision would have also increased for such employee benefits.

"The Board is of the opinion that the Provision for the Long term Employees are determined on the basis of actuarial Valuation Method & technique prescribed in the Accounting Standard. The Consulting fees by actuaries for determining the Provision for long term benefit Plan is even higherthan the Annual Liability of the company for Long term benefits. The company has decided to pay the Long term benefits as and when it becomes due as the amount is negligible and it is not going to make any impact on the financial Position of the company. Considering the size of the company and negligible liability, the company has not made provisions for Long term employee benefits & Defined benefits plan"

21. COST AUDITOR

The Board of Directors, on the recommendation of Audit Committee, has appointed M/s. Bhanwarlal Gurjar & Co., Cost Accountants, (Firm Registration Number 101540) as Cost Auditor to audit the cost accounts of the Company for the financial year 2016-17. As required under the Companies Act, 2013, a resolution seeking member's approval for the remuneration payable to the Cost Auditor forms part of the Notice convening the Annual General Meeting for their ratification.

22. SECRETARIAL AUDIT

Mr. Dhiren R Dave, Surat, Practising Company Secretaries were appointed to conduct the secretarial audit of the Company for the financial year 2015-16, as required under Section 204 of the Companies Act, 2013 read with rules framed there under. The Secretarial Audit Report for FY 2015-16 forms part of the Annual Report. There is no secretarial audit qualification for the year under review.

23. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS MADE

Loans, Guarantees and Investments covered under Section 186 of the Companies Act, 2013 form part of the notes to the financial statements provided in this Annual Report.

24. CONTRACTSAND ARRANGEMENTS WITH RELATED PARTIES

Ail transactions entered with Related Parties for the year under review were on arm's length basis and in the ordinary course of business and that the provisions of Section 188 of the Companies Act, 2013 and the Rules made thereunder are not attracted. Thus, disclosure in form AOC-2 in terms of Section 134 of the Companies Act, 2013 is not required. Further, there are no material related party transactions during the year under review with the Promoters, Directors or Key Managerial Personnel. Ail Related Party Transactions are placed before the Audit Committee as also to the Board for approval. Omnibus approval was obtained for transactions which are of repetitive nature. The policy on materiality of Related Party Transactions as approved by the Board of Directors has been uploaded on the website of the Company. The web-link of the same has been provided in the Corporate Governance Report. None of the Directors has any pecuniary relationship or transactions vis-à-vis the Company.

25. DEVELOPMENTANDIMPLEMENTATIONOF A RISK MANAGEMENT POLICY

Pursuant to the provisions of the Companies Act, 2013 and the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Board formally adopted steps for framing, implementing and monitoring the risk management plan for the Company by way of Risk Management Policy. The main objective of this policy is to ensure sustainable business growth with stability and to promote a pro-active approach in reporting, evaluating and mitigating risks associated with the business. The policy establishes a structured and disciplined approach to Risk Management, in order to guide decisions on risk related issues.In today's challenging and competitive environment, strategies for mitigating inherent risks associated with business and for accomplishing the growth plans of the Company, are imperative. The common risks inter alia are risks emanating from; Regulations, Competition, Business, Technology obsolescence, Investments, retention of talent, finance, politics and fidelity. As a matter of policy, thèse risks are assessed and steps as appropriate are taken to mitigate the same. The Risk Management Policy is also hosted on the Company's website.

26. MATERIAL CHANGES AND COMMITMENTS, IF ANY AFFECTING THE FINANCIAL POSITION OF THE COMPANY OCCURRED BETWEEN THE END OF THE FINANCIAL YEAR TO WHICH THESE FINANCIAL STATEMENTS RELATE AND THE DATE OF THE REPORT

There are no material changes or commitments affecting the financial position of the Company which have occurred between the end of the financial year and the date of this Report.

27. INTERNAL FINANCIAL CONTROLS

The Company has in place adequate internai financial controls with reference to financial statements. The Company's internai control System is commensurate with its size, scale and complexities of its operations. During the year, such controls were tested and no reportable material weaknesses in the design or operation were observed.

28. INSURANCE

The Company's building, plant and machineries, Stocks and other properties wherever necessary and to the extent required have been adequately insured.

29. LISTING OF SHARES AND LISTING FEES

The Equity Shares of your Company are listed and actively traded on the Bombay Stock Exchange Limited (BSE) and the National Stock Exchange of India Limited (NSE). The Company has paid annual listing fees to the both stock exchanges for the financial year2016-17.

30. EXTRACT OF ANNUAL RETURN

In accordance with Section 134(3) (a) of the Companies Act, 2013, an extract of the annual return in the prescribed format is appended as Annexure-1 to the Director's Report.

31. REMUNERATION AND PARTICULARS OF EMPLOYEES

The information in accordance with the provisions of Section 197(12) of the Companies Act, 2013 read with rule 5 of The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is annexed as Annexure- 2 to the Director's Report.Since there is no employee receiving remuneration of Rs. 60 lakh or more, or employed for part of the year and in receipt of Rs. 5 lakh or more a month, there is no information requires to be given under Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014

32. INDUSTRIAL RELATIONS

The Company maintained healthy, cordial and harmonious industrial relations at ail levels.

33. TRANSFER OF UNPAID/UNCLAIMED AMOUNTS TO IEPF

Pursuant to the provisions of Section 125 of Companies Act, 2013 the Unclaimed Dividend, and interest thereon which remained unpaid/unclaimed for a period of 7 years have been transferred by the Company to the Investor Education and Protection Fund (IEPF) established by the Central Government pursuant to Section 125 of the Companies Act, 2013.

34. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS ANDOUTGO

As required under Section 134(3)(m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules,2014 the particulars relating to conservation of energy, technology, absorption and foreign exchange earnings andoutgo is appended as Annexure- 3 to the Director's Report.

35. DISCLOSURE UNDER SEXUAL HARASSMENTOF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL), ACT, 2013

Your Directors further state that during the year under review, there were no cases filed pursuant to the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressai) Act, 2013

36. DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS

During the year under review, there are not any significant and material orders passed by the Regulators or Courts to the Company.

37. ACKNOWLEDGMENT

The Board of Directors wishes to place on record its appreciation for the commitment, dedication and hard work done by the employees in the Company and the cooperation extended by Banks, Government authorities, customers and shareholders of the Company and looks forward to a continued mutual support and co-operation.

For and on behalf of the Board of Directors

For Mohit Industries Limited

(SITARAM SABOO)

Chairman

Place : Surat

Date : 07.07.2016