DIRECTORS' REPORT Dear Shareholders, 1. Your Directors present the 23rd ANNUAL REPORT together with the Audited Financial Statements for the Financial Year 2014 15 ended 31st March, 2015 2. OPERATIONS: During the year under review the sales comprised from the own production and jobwork of furnishing fabrics of Rs. 51.34 lacs as compared to Rs. 95.22 Lacs during 2013-14. The Company has earned other income of Rs. 81.31 Lacs during the year under review as compared to Rs. 39.05 lacs during 2013-14. During the year under review, the Company earned Profit before Depreciation of Rs. 33.90 Lacs compared to Rs. 24.02 Lacs during 201314. After providing for depreciation of Rs. 31.32 Lacs the profit after depreciation stood at Rs. 2.58 Lacs compared to loss of Rs. 25.84 Lacs during 2013-14. After providing for prior period adjustments and adjustments for fixed assets, the Loss before tax stood at Rs. 107.36 Lacs compared to Loss of Rs. 25.93 Lacs during the year 2013-14. After taking credit of Rs. 31.65 lacs for deferred tax asset (previous year deferred tax asset for Rs. 8.48 lacs), the Loss for the year stood at Rs. 75.71 lacs compared to Loss of Rs. 17.45 lacs during the year 2013-14. 3. DIVIDEND: In view of the large accumulated losses, your Directors regret their inability to recommend any dividend on the Equity Shares of the Company. 4. FUTURE OUT LOOK: The Furnishing Fabrics unit of the Company generates cash profit by own marketing/ production and job work so in future the possibility of increasing margins are better. 5. FINANCE: Fund arrangements including working capital have been prudently managed and during the current financial year company did not enjoy any financial assistance from Financial Institutions and Banks. The Company has not raised any term loan during the year as well as not given any guarantee for loans taken by others from bank or financial institutions. The Company's Income-tax Assessment has been completed up to the Assessment Year 2012-13 and Sales tax Assessment is completed up to the Financial Year 2001-02. 6. DIRECTORS: 6.1 Two of your Directors viz. Mr. Satish Batavia and Mr. Dinesh K. Patel resigned and Ms. Kiran M. Virani has been appointed as the Director of the Company during the year under review. 6.2 The Board of Directors duly met 6 times during the financial year under review. 6.3 The Board has made necessary evaluation of its own performance and that of its commitments and of individual Directors. 6.4 The performance evaluation of the Chairman, Executive and Non-Executive Directors was carried out by at the meeting of the Independent Directors held on 19th March, 2015. 6.5 DIRECTORS' RESPONSIBILITY STATEMENT: Pursuant to the requirement of Section 134 of the Companies Act, 2013, it is hereby confirmed: (i) that in the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures; (ii) that 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 31st March, 2015 being end of the financial year 2014-15 and of the Loss of the Company for the year; (iii) that the Directors had 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) that the Directors had prepared the annual accounts on a going concern basis. (v) 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. (vi) 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. 7. MANAGERIAL REMUNERATION: 7.1 REMUNERATION OF DIRECTORS: The Company has not paid any Managerial Remuneration or other benefits to any of its Directors. The Board of Directors has framed a Remuneration Policy that assures the level and composition of remuneration is reasonable and sufficient to attract, retain and motivate Directors, Key Managerial Personnel and Senior Management to enhance the quality required to run the Company successfully. The Relationship of remuneration to performance is clear and meets appropriate performance benchmarks. All the Board Members and Senior Management personnel have affirmed time to time implementation of the said Remuneration policy. 8. KEY MANAGERIAL PERSONNEL (KMP) AND PERSONNEL: There are no material payments to KMP/ Employees. As no material payments have been made the amount is not comparable with the performance of the Company. There is no Employee drawing remuneration requiring disclosure under Rule 5(2) of Companies Appointment & Remuneration of Managerial personnel) Rules, 2014. 9. RELATED PARTY TRANSACTION AND DETAILS OF LOANS, GUARANTEES, INVESTMENT & SECURITIES PROVIDED: Details of Related Party Transactions and Details of Loans, Guarantees and Investments covered under the provisions of Section 188 and 186 of the Companies Act, 2013 respectively are given in the notes to the Financial Statements attached to the Directors' Report. 10. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO: The information required under Section 134(3) (m) of the Companies Act, 2013 and rule 8(3) of Companies (Accounts) Rules, 2014, relating to the conservation of Energy and Technology Absorption forms part of this report and is given by way of Annexure- A. 11. CORPORATE GOVERNANCE AND MDA: As per Clause 49 of the Listing Agreement and the Companies Act, 2013, Report on Corporate Governance and Management Discussion and Analysis (MDA) form part of this Annual Report. A certificate regarding compliance with the conditions of Corporate Governance as stipulated in clause 49 of the listing agreement is also appended to the Annual Report as Annexure - B. 12. SECRETARIAL AUDIT REPORT: Your Company has obtained Secretarial Audit Report as required under Section 204(1) of the Companies Act, 2013 from M/s. Kashyap R. Mehta & Associates, Company Secretaries, Ahmedabad. The said Report is attached with this Report as Annexure - C. As regards the observation of the Auditors, the Company is in the process of identifying and appointing Whole-time Company Secretary and also developing functional website of the Company. 13. EXTRACT OF ANNUAL RETURN: The extract of Annual return in Form - MGT-9 has been attached herewith as Annexure - D. 14. AUDIT COMMITTEE/ NOMINATION AND REMUNERATION COMMITTEE/ STAKEHOLDERS' RELATIONSHIP COMMITTEE: The details of various committees and their functions are part of Corporate Governance Report. 15. GENERAL: 15.1 AUDITORS: The present Auditors of the Company M/s. Natvarlal Vepari & Co., Chartered Accounts, Surat, will retire at the ensuing 23rd Annual General Meeting. The Company has obtained from them consent to the effect that their reappointment as Auditors of the Company for period of 2 years commencing from the Financial Year 2015-16 to 2016-17, if made, will be in accordance with the provisions of Section 139 and 141 of the Companies Act, 2013. The remarks of Auditor are self explanatory and have been explained in Notes on Accounts. 15.2 INSURANCE: The movable and immovable properties of the Company including plant and Machinery and stocks wherever necessary and to the extent required have been adequately insured against the risks of fire, riot, strike, malicious damage etc. as per the consistent policy of the Company. 15.3 DEPOSITS: The Company has not accepted during the year under review any Deposits and there were no overdue deposits. 15.4 RISKS MANAGEMENT POLICY: The Company has a risk management policy, which from time to time, is reviewed by the Audit Committee of Directors as well as by the Board of Directors. The Policy is reviewed quarterly by assessing the threats and opportunities that will impact the objectives set for the Company as a whole. The Policy is designed to provide the categorization of risk into threat and its cause, impact, treatment and control measures. As part of the Risk Management policy, the relevant parameters for protection of environment, safety of operations and health of people at work and monitored regularly with reference to statutory regulations and guidelines defined by the Company. 15.5 SUBSIDIARIES/ ASSOCIATES/ JVS: The Company does not have any Subsidiaries/ Associates Companies / JVs. 15.6.RESEARCH & DEVELOPMENT: The Company is continuously working on Research and Development resulting in new innovation leading to cost reduction and better product quality. 15.7 CODE OF CONDUCT: The Board of Directors has laid down a Code of Conduct applicable to the Board of Directors and Senior Management. All the Board Members and Senior Management personnel have affirmed compliance with the code of conduct. 15.8 SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS: There have been no significant and material orders passed by any regulators or courts or tribunals, impacting the going concern status of the Company and its future operations. 15.9 DISCLOSURES UNDER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION & REDRESSAL) ACT, 2013: The Company has in place an Anti Sexual Harassment Policy, in line with the requirements of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. During the year under review, the Company did not receive any complaint. 15.10 INSTANCES OF FRAUD, IF ANY REPORTED BY THE AUDITORS: There have been no instances of fraud reported by the Auditors under Section 143(12) of the Companies Act, 2013. 16. DEMATERIALISATION OF EQUITY SHARES: Shareholders have an option to dematerialise their shares with either of the depositories viz NSDL and CDSL. The ISIN No. allotted is INE979D01011.. 17. ACKNOWLEDGMENT: Your Directors express their sincere thanks and appreciation to Promoters and Shareholders for their constant support and co operation. Your Directors also place on record their grateful appreciation and co operation received from Bankers, Financial Institutions, Government Agencies and employees of the Company. For and on behalf of the Board Kiran M. Virani Director Mansukh K. Patel Wholetime Director Place : Ankleshwar Date : 29th July, 2015 |