Directors' report Your Directors present the 42nd Annual Report together with the Audited Statement of Accounts of the Company for the year ended 31st March, 2015. IMPLEMENTATION STATUS OF BIFR SCHEME Your Company was discharged by BIFR vide its order dated 23.02.2010 which states as under "The unimplemented provisions of the SS-08 for the unexpired period for the scheme would be implemented by the concerned agencies and their implementation would be monitored by the Company". Further BIFR in a miscellaneous application No. 501/2013 filed by the Company had clarified that no period for scheme was mentioned in SS-08 and unimplemented provisions of the sactioned scheme are binding on all the parties. In terms of said BIFR's order dated 23.02.2010, your Company has been implementing the unimplemented provision of the revival scheme sanctioned by the BIFR. In this respect, rehabilitation for Modinagar Tyre Factory (MTF) could not be achieved as yet. The matter for possession of MTF Plant is pending with Hon'ble Allahabad High Court. The Plant continues to be in possession of the OL appointed by the Allahabad High Court in Modi Export Processors Limited's (MEPL) winding up proceedings. Litigation is also pending with 3-4 creditors who have till date not accepted the dues as per scheme sanctioned by the BIFR. Your Company has been following up with Govt agencies/authorities/ department/Creditors to provide relief and concessions and to accept settlement as per scheme sanctioned by the BIFR. The Company has taken new initiatives to improve its long term prospects and performance. These include:- 1. Your Company has been very vigorously taking actions to get re-possession of Company's properties which were occupied by illegal occupants/Ex- Employees. Efforts include legal recourse, and also settlement as per BIFR Scheme wherever possible. 2. Company is taking several steps to utilize its real- estate resources and wherever possible to put them to generate revenue. 3. Your company is also exploring additional avenues of investment in new projects in joint ventures. FINANCIAL RESULTS During the year under review, your company has recorded a net profit after tax Rs119.89 Lacs as compared to Rs 124.21 Lacs in previous year on a total income of Rs 2540.92 Lacs as compared to 2278.32 Lacs in the previous year. Income of your company is mainly from guest house operations, Interest & dividend. Since, there is no adequate profit; your Board does not recommend any dividend. FIXED DEPOSITS Your Company has not accepted any fixed deposits from public during the year under review. MANAGEMENT DISCUSSION AND ANALYSIS AND CORPORATE GOVERNANCE REPORTS Your Company is committed to maintain the highest standards of corporate governance and adhere to the corporate governance requirements as set out by SEBI. A detailed Management Discussion & Analysis Report and a Corporate Governance Report along with certificate from the statutory auditors of the Company in pursuance with compliance Clause 49 of the Listing Agreement are attached and form part of this Annual Report of the Company. BOARD OF DIRECTORS A) Appointment/Re-appointment of Directors According to section 149 and other applicable provisions of the Companies Act, 2013, your Board is seeking appointment of Shri. Sanjiwan Sahni (DIN 01050255) as Independent Directors and he shall hold office for a term of 5 (five) consecutive years up to May 28, 2020. In accordance with the Companies Act, 2013, Shri. Vinay Kumar Modi retires by rotation at the ensuing Annual General Meeting and, being eligible, has offered himself for re-appointment. Your Board has recommends his re-appointment. B) Key Managerial Personnel The Board of Directors of your Company has appointed Mr. Kamal Gupta as the Chief Financial Officer of the Company with effect from September 01, 2014. The Board of Directors of your Company has appointed Ms. Piya Modi as the Whole-Time-Director of the Company for a period of 3 years with effect from October 01, 2014. C) Meeting of the Board of Directors During the financial year ended on March 31, 2015, 4 (four) Board Meetings and 1 (one) meeting of Independent Directors was held and the maximum time gap between any two Board meetings was less then 120 days. Further, details of the meetings of the Board and its Committees are given in Corporate Governance Report, forming part of the Annual Report. D) Declaration by Independent Director(s) The Company has received declarations from all the Independent Directors of the Company confirming that they meet the criteria of independence as prescribed both under sub-section (6) of Section 149 of the Companies Act, 2013 and under Clause 49 of the Listing Agreement with the Stock Exchanges. E) Board Evaluation The Company has formulated a policy on performance evaluation of the Directors, Board and its Committees and other individual Directors which shall be based on inter alia components like attendance, effective participation, domain knowledge, access to management outside Board Meetings and Compliance with the Code of Conduct, vision and strategy and benchmark to peers. On the basis of policy for performance evaluation of Independent Directors, Board, Committees and other individual directors, a process of evaluation was carried out. The Company make presentations to the Board of Directors in order to familiarize them with their roles, rights, responsibilities in the Company, nature of the Industry in which it operates, Business models of the Company and related matters. Details of such presentations are available on company's website. SUBSIDIARIES / JOINT VENTURES/ ASSOCIATE COMPANIES The performance and financial information of the subsidiary companies / Joint Ventures / Associate Companies is disclosed in the Consolidated Financial Statement for the financial year ended March 31, 2015. CONSOLIDATED FINANCIAL STATEMENT In accordance with the provisions of the Companies Act, 2013 read with Clause 32 of the Listing Agreement and Accounting Standard AS-21 on Consolidated Financial Statement, AS-23 on Accounting for Investments in Associates and AS-27 on financial reporting of interests in joint ventures, the audited consolidated financial statement for the year ended March 31, 2015 is provided in the Annual Report. AUDIT COMMITTEE The details of the Audit Committee including its composition and terms of reference mentioned in the Corporate Governance Report forms part of Annual Report. All the recommendations made by the Audit Committee were accepted by the Board. DIRECTORS' RESPONSIBILITY STATEMENT Pursuant to the requirement under Section 134(3)(c) of the Companies Act, 2013, with respect to Directors' Responsibility Statement, it is hereby confirmed that: i) in the preparation of the annual accounts for the financial year ended March 31, 2015, the applicable Accounting Standards read with the requirements set out under Schedule III to the Companies Act, 2013, have been followed and there are no material departures from the same; ii) the Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and pursuant to as to give a true and fair view of the state of affairs of the Company as at March 31, 2015 and of the loss of the Company for the year ended on that date; iii) the Directors have taken proper and sufficient care for maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities; iv) the Directors have prepared the annual accounts of the Company for the financial year ended March 31, 2015 on a 'going concern' basis; v) the Directors have laid down internal financial control to be followed by the Company and that such internal financial control are adequate and were operating effectively; and vi) the Directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively. RISK ASSESSMENT/ MANAGEMENT The Company has formulated and adopted a Risk Management Policy. Board of Directors of the Company is responsible for the direction and establishment of internal control to mitigate material business risks. The policy is framed to identify element of risks like misstatement, frauds etc and their mitigation for achieving its business objective and to provide reasonable assurance. CORPORATE SOCIAL RESPONSIBILITY (CSR) The Company has constituted a CSR Committee to inter alia promote a comprehensive and integrated development through social and economic transformation and the detailed Policy for achieving this objective is available on Company's website. During the year under review Company did not undertake any initiative due to rehabilitation of unimplemented portion of revival scheme sanction by the BIFR. However Board is hopeful to carry out some initiative during the year. The applicable disclosures as stipulated under the Companies (Corporate Social Responsibility Policy) Rules, 2014 is provided in Annexure I to this Report. VIGIL MECHANISM The Company promotes ethical behavior in all its business activities. Towards this endeavor the Company has adopted a policy on vigil mechanism and whistle blower. Company has developed a Mechanism where any violation can be report to the Chairman of the Audit Committee for appropriate resolution. The confidentiality of such reporting will be maintained and they are not subjected to any discriminatory practice or victimization. The Audit Committee shall overseas the Vigil Mechanism. The policy on vigil mechanism and whistle blower is available on Company's website. RELATED PARTY TRANSACTIONS The contracts/ arraignment/ transitions by the company during the year under review with related parties were in the ordinary course of business and on arms length basis and do not attract the provisions of section 188 of the companies Act 2013. During the year, the Company had not entered into any contract/ arrangement/ transactions with related parties which could be considered material in accordance with the policy of the Company on materiality of related party transactions. Suitable disclosure as required by the Accounting Standards has been made in the Notes to the Financial Statement. The policy on Related Party Transaction and determining material Subsidiaries as approved by the Board is uploaded on the company's website. PARTICULARS OF LOAN, GUARANTEES, SECURITY OR INVESTMENTS Details of Loans, Guarantee, Securities and Investments during the year under review are given in the Notes to the financial statements pursuant to requirement of under Section 186 of the Companies Act, 2013. AUDITOR & AUDITOR'S REPORT The Statutory Auditors, M/s.PDM and Company, Chartered Accountants, (Firm Registration No 007966N) New Delhi, were appointed as Auditors of the Company for a period of three years at the 41th Annual General Meeting held on September 30, 2014 and the appointment was subject to ratification at each Annual General Meeting. The Company has received letter from them to the effect that their ratification of appointment if considered, will be within the prescribed limits under Section 141(3)(g) of the Companies Act, 2013 and that they are not disqualified for holding the office of the Auditors. Accordingly, the Board recommends ratification of their appointment as Statutory Auditors of the Company by the Shareholders at the ensuing Annual General Meeting of the Company. Auditors' observations in their Report have been elaborately dealt with in the Auditors' Report / Notes on Accounts. The same are self explanatory and do not need any more information/explanation. Cost Accounting Record Rules and Cost Audit Report Rules are not applicable due to non functional of MTF Plant. SECRETARIAL AUDITOR AND SECRETARIAL AUDIT REPORT In terms of Section 204 of the Companies Act, 2013, the Board of Directors of the Company appointed M/s Sanjay Grover and Associates to conduct the Secretarial Audit. The Secretarial Audit Report for the financial year ended March 31, 2015, in the prescribed format is attached and marked as Annexure II with this report. The Secretarial Audit Report is self-explanatory and do not call for any further comments. The Secretarial Auditors' Report does not contain any qualification, reservation or adverse remark. MANAGERIAL REMUNERATION The information required in terms of the provisions of Section 197(12) of the Companies Act, 2013 read with Rules 5 (1), (2) and (3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 forms part of this Report. (Annexure-III) EXTRACT OF ANNUAL RETURN Extracts of the Annual Return in the prescribed format is attached with this report and marked as Annexure IV. STATUTORY DISCLOSURES Since there was no production, there is no information required to be given for energy conservation, technology absorption, fuel consumption etc. u/s 134(3) (m) of the Companies Act, 2013. Information about foreign exchange earnings is nil and outgo is Rs 34.15 Lacs during the year under review ACKNOWLEDGEMENT Your Directors place on record their sincere thanks for support and cooperation from the Hon'ble BIFR/AAIFR, Banks, UP Government and other Government Authorities and shareholders during the year period review. Your Directors also appreciate services of executives and staff of the Company for unstinted support in revival of the Company. For and on behalf of the Board of Directors Vinay Kumar Modi Chairman Place: New Delhi Date: July 27, 2015 |