DIRECTORS' REPORT TO THE MEMBERS, We are privileged to place before you the 24th Annual Report of your Company together with Audited Financial Accounts for the Financial Year (FY) ended 31st March 2015. Dividend: In view of the accumulated losses, your directors are unable to recommend any dividend on Equity as well as Preference Shares for the year. Performance & Operations Since last many years, the paper industry has gone through tremendous technological changes with new generation machineries having come in which have changed the entire business dynamics and the company has not been able to cope up with the changes due to its financial constraints and lack of capability to adopt to these technological changes and eventually the turnover of the company kept deteriorating year after year leading to substantial losses. Accordingly manufacturing operations were suspended in June, 2009 and eventually the old obsolete machinery have been sold to clean some of the liabilities. The company is now planning to restart its business operations by dealing in the paper products by trading in the same. This will need some working capital. The company does not envisage starting again its manufacturing unit and hence sold the factory, land and building for a lumpsum consideration of Rs.9.00 crores on 3rd June, 2015 to the Nobel Hygiene Private Limited after taking the shareholders approval and other formalities. Material changes and Commitments affecting financial position between the end of the financial year and date of report The Company has entered into an agreement with Nobel Hygiene Private Limited for the assignment of lease for the leasehold Land & Factory Building thereon situated at A/70, MIDC, Sinnar, Nashik. and have also received the agreed consideration of Rs.9.00 crores for the same. Out of the consideration the Company has redeemed its preference shares of Rs.4.25 crores issued to the Nobel Hygiene Private Limited on 11th June, 2015 and has also cleared all its other outside liabilities. Internal Financial control The Company has in place adequate internal financial control with reference to financial statements. During the year, such controls were tested and no reportable material weakness in designs or operations were observed Deposits The Company has not accepted any deposit from the public during the year. Statutory Auditor M/s. Shyam Malpani & Associates, Chartered Accountants, Statutory Auditor of the Company, hold office till the conclusion of the ensuing Annual General Meeting and are eligible for re-appointment. They have confirmed their eligibility to the effect that their re-appointment, if made, would be within the prescribed limits under the Act and that they are not disqualified for re-appointment. Comments on Auditor qualifications The observations made by the Auditor in their report are self explanatory and therefore do not call for any comment. Significant & Material Orders - Going Concern Status There are no significant and material order passed by the regulators or courts or tribunals impacting the going concern status and company's operation in future. 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 Board's Report. Conservation of Energy, technology absorption and Foreign exchange earnings and outgo A statement giving details of conservation of energy, technology absorption and foreign exchange earnings and outgo as required to be disclosed under the Act, are provided in Annexure 2 to this report. Corporate Social Responsibility (CSR) As company is not falling in the criteria specified under section 135(1) of the Companies Act, 2013, no comment is invited. Changes in Directors Pursuant to Share Purchase Agreement dated 02nd September, 2014 and successful completion of open offer existing management of the Company ie. Shri Bansilal Sharma, Shri B S Rathi, Shri Anand Kumar Poddar and Shri Gourishankar Damani tabled the resignation and same were accepted by the management with effect from closing hours of 30th January, 2015. During the year under review, Existing board has appointed Mr. Manish D. Ladage & Mrs. Kamini Johari as Additional Director and Mr. Mahesh Makhijani & Mr. Krishnamurthy Ananthanarayanan as an Independent Additional Director till the forth coming Annual General Meeting. The Company has received a notice in writing from the share holders under Section 160 of the Companies Act, 2013 proposing their candidature for the office of Director of the Company at the forthcoming Annual General Meeting. During the year all the directors were appointed as additional directors and seek their appointment as a director in the forth coming Annual General Meeting and hence the provision of retirement by rotation is not applicable. Declaration by an Independent Director The Company has received the necessary declaration from each independent director under Section 149 (7) of the Companies Act, 2013 that he/she meets the criteria of Independence laid down in Section 149 (6) of the Companies Act, 2013. Board evaluation The Company has devised a Policy for performance evaluation of Independent Directors, Board, Committees and other individual Directors which include criteria for performance evaluation of the non-executive directors and executive directors which reviewed periodically. No. of Board Meetings The Board meets 8 times during the financial year. The intervening gap between any two meetings was within the period prescribed by the Companies Act, 2013. Particulars of Employees and Related Disclosure Particulars of employees within the meaning of Section 197 (12) of the Act read with Rules 5 (2) and 5 (3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 have not been furnished as there was no employee in the aforesaid category. Vigil mechanism The Vigil Mechanism of the Company, which also incorporates a whistle blower policy in terms of the Listing Agreement, includes an Ethics & Compliance Task Force. Protected disclosures can be made by a whistle blower through an email, or dedicated telephone line or a letter to the Task Force or to the Chairman of the Audit Committee. Particulars of loans, guarantees or investments The Company has not given any loan, guarantees or made investments under Section 186 of the Companies Act, 2013. Particulars of contracts or arrangements with related parties: All contracts or arrangements with related parties entered into or modified during the financial year were on a arms length basis and in the ordinary course of business. All such contracts or arrangements have been approved by the Audit Committee. Particulars of contracts or arrangement with related parties referred to in Section 188 (1) of the Companies Act, 2013, in the prescribed form AOC-2, is appended as Annexure 3 to the Board Report. Policy on Director's appointment and Remuneration: Nomination and Remuneration Committee has formulated a policy relating to remuneration for the directors, KMPs and other employees, however during the Year Company has not paid any remuneration to directors and no employees are there on the pay roll of the Company. Secretarial Auditor The board has appointed M/s. JNG & Co., Practicing Company Secretary, to conduct Secretarial Audit for the financial year 2014-15. The Secretarial Audit report for the financial year ended March 31, 2015 is appended as Annexure 4 to the Board Report. Comments on Secretarial Audit Qualification The observations made by the Company Secretary in their report are self explanatory and therefore do not call for any comment. Risk management policy Your Company has an elaborate Risk Management procedure, which is based on three pillars: Business Risk Assessment, Operational Controls Assessment and Policy Compliance processes. Major risks identified by the businesses and functions are systematically addressed through mitigating actions on a continuing basis. Some of the identified risks relate to competitive intensity and cost volatility. Directors' Responsibility Statement Your Directors State that: a) In the preparation of the annual Accounts for the year ended March 31,2015, the applicable accounting standard read with requirements set out under schedule III to the act, have been followed and there are no material departures from the same; b) the Directors have selected such accounting policies and applied the 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 as at March 31,2015, and of the profit of the company for the year ended on that date; c) the director have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provision of the act of 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; 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; and f) the Directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively. Prevention of Sexual Harassment at Work place Your director state that during the year under review, there were no cases filed pursuant to the Sexual harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. Management Discussion & Analysis Report & Corporate Governance Report Pursuant to SEBI Circular No.CIR/CFD/POLICY CELL/7/2014 the The Clause 49 of the Listing Agreement shall be applicable to all companies whose equity shares are listed on a recognized stock exchange. However, compliance with the provisions of Clause 49 shall not be mandatory, for the time being, in respect of the Companies having paid up equity share capital not exceeding Rs.10 crore and Net Worth not exceeding Rs.25 crore, as on the last day of the previous financial year; As our company's paid up equity share capital is not exceeding Rs.10 crore and Net Worth not exceeding Rs.25 crore, as on the last day of the previous financial year, compliance with provisions of Clause 49 is time being not applicable. Acknowledgements Your Directors wish to place on record their appreciation of the continued support and valuable co-operation received from the Company's Bankers, Institutions, Customers, Suppliers and Share Holders. On behalf of the Board of Directors (Kamini Kamal Johari) DIN:01309286 Chairman Place: Mumbai Date: August 14, 2015 |