BOARD'S REPORT To the Members, 1. Your Directors are pleased to present the 39th Annual Report of the Statements of Accounts for the year ended 31st March, 2015. 2. DIVIDEND: During the financial year 2014-15 your Company has incurred losses and therefore, your Directors have decided to skip the Dividend for the period under review. Board of Directors sincerely hopes that members would appreciate and understand the situation for non-.payment of Dividend. 3. TRASFER TO RESERVES: Pursuant to provisions of Section 134(1 of the Companies Act, 2013, the company has not proposed to transfer any amount to general reserves account of the company during the year under review. 4. REVIEW OF BUSINESS OPERATIONS AND FUTURE PROSPECTS: Your Directors wish to present the details of Business operations done during the year under review: The period under review was a very challenging year for your Company which also reflects in its performance. Total income for the year 2014-15 was registered at Rs. 4338.38 lacs (Gross) as compared to income of Rs. 4947.09 lacs (Gross) for the year 2013-14, a decline of 12%. Loss after tax was reported at Rs. 155.38 lacs for the year 2014-15 as compared to the net profit of Rs. 75.04 lacs for the period of 2013-14, again a decline of 307%. Sales volumes for the year 2014-.15 were at 1605.375 MT as compared to 1621.265 MT for the year 2013-14. Further details of Operations are given in the Management discussion and analysis report, which forms part of this report as "ANNEXURE.A". 5. TRANSFER OF UNCLAIMED DIVIDEND TO INVESTOR EDUCATION AND PROTECTION FUND: In terms of Section 205A read with Section 205C of the Companies Act, 1956, unclaimed or unpaid Dividend relating to the financial year 2008 is due for remittance on 4th September, 2015 which has not been claimed by shareholders of the Company. Shareholders are required to lodge their claims with the Company's RTA, M/s. MCS Share Transfer Agent Limited for unclaimed dividend. Pursuant to the provisions of Investor Education and Protection Fund (Uploading of Information regarding unpaid and unclaimed amounts lying with Companies) rules, 2012, the Company has uploaded the details of unpaid and unclaimed amounts lying with the Company on 12th August 2014 (date of the last Annual General Meeting) on the website of the Company (www.dacl.co.in), as also on the website of the Ministry of Corporate Affairs (www.mca.gov.in). 6. MATERIAL CHANGES AND COMMITMENT IF ANY AFFECTING THE FINANCIAL POSITION OF THE COMPANY OCCURRED BETWEEN THE END OF THE FINANCIAL YEAR TO WHICH THIS FINANCIAL STATEMENTS RELATE AND THE DATE OF THE REPORT: No material changes and commitments affecting the financial position of the Company occurred between the end of the financial year to which these financial statements relate on the date of this report. 7. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO: The information pertaining to conservation of energy, technology absorption, Foreign exchange Earnings and outgo as required under Section 134 (3)(m) of the Companies Act, 2013 read with Rule 8(3) of the Companies (Accounts) Rules, 2014 is furnished in "ANNEXURERs.B" and is attached to this report. Your Company understands and appreciates the responsibility and importance of conservation of energy and continuous to put efforts in reducing or optimizing energy consumption for its operations. The Company has taken various measures for conservation of energy such as: - Reduction in steam consumptions, electricity and cooling water by debottlenecking of various operations - Improvement in the yields and planned increase in throughput - Improved steam condensate recovery by installing new designs of traps and monitoring trap performance - Utilization of byRs.products steams - Modification in coal fired boiler to improve efficiency by increasing coal to steam ratio 8. SAFETY, HEALTH AND ENVIRONMENT: a) Safety: The Company encourages a high level of awareness of safety issues among its employees and strives for continuous improvement. All incidents are analysed in the safety committee meetings and corrective actions are taken immediately. Employees are trained in safe practices to be followed at work place. The Company is active member of local Crisis group such as Offsite Industrial Emergency Control Room (OIECR). External safety audits are carried out from time to time and audit recommendations are implemented. Safety promotional activities such as celebration of National Safety day, arranging poster competition, slogan competition and prize distribution are conducted every year to encourage safety culture. Company also conducts Mock drill regularly on quarterly basis and outcome of Mock drill is analysed and necessary improvements are implemented regularly. Company also makes continuous efforts to increase Safety awareness with regular and contractual employees and workers. b) Health: Your Company attaches utmost importance to the health of its employees. Periodic checkup of employees is done to monitor their health. Company also has Occupational Health Center open for 24 hrs., and Ambulance facility at its Manufacturing site. Health related issues if any are discussed with visiting Medical Officer. Company also has a tie up with one hospital in the City to provide timely medical assistance to the employees/workers in case of emergencies. c) Environment: Company always strives hard to give importance to environmental issues in normal course of operations. Adherence to Environmental and pollution control Norms as per Gujarat Pollution Control guidelines is of high concern to the Company. The Company is also signatory to "Responsible Care", a voluntary initiative of International Council of Chemical association (ICC) being implemented by Indian Chemical Council to safely handle the products from inception in research laboratory through manufacturing and distribution to utilization, reuse, recycle and finally their disposal. d) Renewable Source of Energy: Your Company is also contributing in reducing Carbon foot printing from the Environment by generating power through renewable sources and by harnessing wind Energy. The Company has installed three (3) Wind Turbine Generators (WTG) of total 3.50 MW Capacity and are always ensured in full operational mode. 9. CORPORATE SOCIAL RESPONSIBILITY INITIATIVES AND POLICY: The Company has not implemented any Corporate Social Responsibility initiatives as the provisions of Section 135 of the Act and Rules made thereunder governing Corporate Social Responsibility are not applicable. 11. MATERIAL ORDERS PASSED BY REGULTORY/COURT: There were no significant and material orders passed by any regulators and/or courts and tribunals which may have the impact on the going concern status and company's operations in future. 12. INTERNAL FINANCIAL CONTROLS: The Board of Directors of the Company has laid down adequate internal financial controls which are operating effectively. During the year, policies and procedures are adopted by the Company for ensurng the orderly and efficient conduct of its business, including adherence to the Company's policies, safeguarding of its assets, the prevention and detection of its frauds and errors,the accuracy and completeness of the accounting records and the timely preparations of reliable financial information. 13. PARTICULARS OF CONTRACTS OR ARRANGEMENTS MADE WITH RELATED PARTIES: All transactions entered into with the Related Parties as defined under the Companies Act, 2013 read with Clause 49 of the Listing Agreement during the financial year were in the ordinary course of business and on arm's length basis and do not attract the provisions of Section 188 of the Companies Act, 2013. There were no Material Related Party transactions during the year and therefore details as required in AOCRs.2 is not applicable. 15. EXPLANATION OR COMMENTS ON QUALIFICATIONS, RESERVATIONS OR ADVERSE REMARKS OR DISCLAIMERS MADE BY THE AUDITORS AND THE PRACTICING COMPANY SECRETARY IN THEIR REPORTS: There was no qualifications, reservations or adverse remarks made by the either by the Auditors or by the Practicing Company Secretary in their respective reports. 16. ANNUAL RETURN: In accordance with Section 134(3)(a), the extracts of Annual Return pursuant to the provisions of Section 92(3) in prescribed form MGTRs.9 is furnished in "ANNEXURE C" and is attached to this Report. 17. NUMBER OF BOARD MEETINGS CONDUCTED DURING THE YEAR UNDER REVIEW: The Company had Four (4) Board meetings during the financial year under review. Further details are given in the report of Corporate Governance forming part of this Report. 18. DIRECTORS RESPONSIBILITY STATEMENT: In accordance with the provisions of Section 134(5) of the Companies Act, 2013 the Board hereby submits its responsibility Statement 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. 19. SUBSIDIARY COMPANY, IT'S PERFORMANCE & FINANCIAL POSITION: Pursuant to Accounting Standard AS 21 issued by the Institute of Chartered Accountants of India, Consolidated Financial Statements presented by the Company include the financial information of Diamines Speciality Chemicals Pvt. Ltd. The Company has Fifty Thousand (50,000) equity shares constituting 100% of the paidRs.up equity share capital of Diamines Speciality Chemicals Pvt. Ltd. Pursuant to provisions of Section 2(87) of the Companies Act, 2013, Diamines Speciality Chemicals Pvt. Ltd is the 100% wholly owned subsidiary of our Company. For the financial year ended 31st March, 2015, the Diamines Speciality Chemicals Pvt. Ltd has not started its commercial activity yet. Consolidated financial statement of the Company and of the subsidiary, Diamines Speciality Chemicals Pvt. Ltd, forms part of the Annual Report. A separate statement containing the salient features of the financial statement of Diamines Speciality Chemicals Pvt. Ltd is part of this Annual Report and given in FormAOCRs.1. The Company does not have any associate or Joint Venture Company as on report date. 20. DEPOSITS The Company has neither accepted nor renewed any deposits falling within the purview of Section 73 of the Companies Act, 2013 read with Companies (Acceptance of Deposits) Rules, 2014 as amended from time to time, during the year under review and therefore details mentioned in Rule 8(5)(v)& (vi) of Companies (Accounts) Rules, 2014 relating to deposits, covered under Chapter V of the Act is not required to be given 21. DIRECTORS Mr. Yogesh M Kothari (DIN: 00010015) and Mr. Amit M Mehta (DIN: 00073907) retire at this Annual General Meeting and being eligible offer themselves for reRs.appointment.The Board of Directors has placed on record its sincere appreciation and gratitude for the very valuable and outstanding contribution made by Mr. Girish Satarkar, Executive Director (DIN: 00340116) of the Company during his association with the Company who has resigned w.e.f. 6th February, 2015. Mr. G S Venkatchalam (DIN:02205898), was appointed as an Executive Director of the Company w.e.f. February 7, 2015. Earlier he was holding position as Director (NonRs.Executive Independent) in the Company. During the year under review, Mrs. Darshana Mankad (DIN: 00041675) has been appointed as an Additional Directors of the Company w.e.f. November 11, 2014 and she holds the office of Director upto the date of the forthcoming Annual General Meeting. The Company has received letter from shareholders recommending her appointment as Director of the Company. The proposal of her appointment has been put forth for approval of the shareholders of the Company in the Notice of the AGM. A brief resume of the Directors seeking appointment at the forthcoming Annual General Meeting and other details as required to be disclosed in terms of Clause 49 of the Listing Agreement forms part of the Notice. None of the Directors is disqualified for appointment/reRs.appointment under Section 164 of the Companies Act, 2013. As required by law, this position is also reflected in the Auditors' Report. The composition of the Board, meetings of the Board held during the year and the attendance of the Directors there at have been mentioned in the Report on Corporate Governance in the Annual Report. 22. DECLARATION OF INDEPENDENT DIRECTORS: All the Independent Directors have submitted their declaration to the Board that they fulfill all the requirements as stipulated in Section 149(6) of the Companies Act, 2013 so as to qualify themselves to be appointed as Independent Directors under the provisions of the Companies Act, 2013 and the relevant rules. 23. BOARD EVALUATION: Clause 49 of the Listing Agreement mandates that the Board shall monitor and review the Board evaluation framework. The Companies Act, 2013 states that a formal annual evaluation needs to be made by the Board of its own performance and that of its committees and individual directors. Schedule IV of the Companies Act, 2013 states that the performance evaluation of independent directors shall be done by the entire Board of Directors, excluding the director being evaluated. The evaluation of all the directors and the Board as a whole was conducted based on the criteria and framework adopted by the Board. The Board approved the evaluation results as collated by the nomination and remuneration committee. None of the independent directors are due for reRs.appointment. 25. PARTICULARS REGARDING EMPLOYEES REMUNERATION: The statement containing particulars of employees as required under Section 197 (12) of the Companies Act, 2013 read with Rule 5 (2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 forms part of this Report as "ANNEXURERs.D". 26. KEY MANAGERIAL PERSONNEL As required under Section 203 of the Companies Act, 2013, the Company has noted that Mr. G S Venkatchalam, Executive Director of the Company, Mr. A R Chaturmutha, Chief Financial Officer and Ms. Dimple Mehta, Company Secretary are the Key Managerial Personnel of the Company. 27. AUDITORS a. STATUTORY AUDITOR M/s Bansi S Mehta & Co., Chartered Accountants, was appointed as Statutory Auditors for a period of four (4) years in the Annual General Meeting held on 12.08.2014. Their continuance of appointment and payment of remuneration are to be confirmed and approved in the ensuing Annual General Meeting. The Company has received a certificate from the above Auditors to the effect that if they are reappointed, it would be in accordance with the provisions of Section 141 of the Companies Act, 2013. b. SECRETARIAL AUDIT 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 Sandip Sheth & Associates, Company Secretaries in Practice to undertake the Secretarial Audit of the Company. The Report of the Report is annexed herewith as "ANNEXURE E". 28. 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. 29. RISK MANAGEMENT POLICY: The Company has a risk management policy which from time to time is reviewed by the Audit Committee of the 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 this into threats and its cause, impact, treatment and control measures. As part of the risk management policy, the relevant parameters for manufacturing sites are analysed to minimize risk associate with protection of environment, safety of operations and health of people at work and monitor regularly with reference to statutory regulations and guidelines defined by the company. The company fulfills its legal requirement concerning emission, waste water and waste disposal. Improving work place safety continued top priority at manufacturing site. 30. DISCLOSURE OF COMPOSITION OF AUDIT COMMITTEE AND PROVIDING VIGIL MECHANISM: The Audit Committee consists of the following members: a. Mr. Rajendra Chhabra -. Chairman b. Mr. Kirat Patel -. Director c. Mrs. Darshana Mankad -. Director The above composition of the Audit Committee consists of independent Directors viz., Mr. Rajendra Chhabra and Mrs. Darshana Mankad who form the majority. The Company has established a vigil mechanism and overseas through the committee, the genuine concerns expressed by the employees and other Directors. The Company has also provided adequate safeguards against victimization of employees and Directors who express their concerns. The Company has also provided direct access to the chairman of the Audit Committee on reporting issues concerning the interests of co-.employees and the Company. 31. SHARES a. BUY BACK OF SECURITIES The Company has not bought back any of its securities during the year under review. b. SWEAT EQUITY The Company has not issued any Sweat Equity Shares during the year under review. c. BONUS SHARES No Bonus Shares were issued during the year under review. d. EMPLOYEES STOCK OPTION PLAN The Company has not provided any Stock Option Scheme to the employees. 33. INSURANCE: All the properties and assets of the Company are adequately insured. 34. CODE OF CONDUCT: The Board of Directors has laid down a Code of Conduct applicable to the Board of Directors and Senior management which is available on Company's website. All Board members and senior management personnel have affirmed compliance with the Code of Conduct. 35. INSIDER TRADING POLICY: As required under the new Insider Trading Policy Regulations of SEBI, your Directors have framed new Insider Trading Regulations and Code of Internal Procedures and Conducts for Regulating, Monitoring and Reporting of Trading by Insider. For details please refer to the company's website.Web link is http://www.dacl.co.in/investors/SEBI Disc.pdf 36. NOMINATION AND REMUNERATION POLICY: Our policy on the appointment and remuneration of Directors and Key Managerial Personnel provides a framework based on which our human resources management aligns their recruitment plans for the strategic growth of the Company. The Nomination and Remuneration policy as provided herewith pursuant to provisions of Section 178(4) of the Companies Act, 2013 and Clause 49(IV)(B)(4) of the Listing Agreement. The policy is also available on our website.Web link is http://www.dacl.co.in/investors/Remuneration%20policy%20DACL.pdf. 37. CORPORATE GOVERNANCE: Pursuant to the clause 49 of the Listing Agreement, a separate section forming part of this report and titled as "Corporate Governance" is attached herewith as "ANNEXURE F". 38. DISCLOSURE UNDER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013: In line with the requirements of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013, the Company has set up Internal Complaints Committees at its workplaces to redress complaints received regarding sexual harassment. No complaints have been reported during the financial year 2014-.15. All employees (permanent, contractual, temporary, trainees) are covered under this policy. 39. ACKNOWLEDGEMENT Your Directors place on record their sincere thanks to bankers, business associates, consultants, and various Government Authorities for their continued support extended to your Companies activities during the year under review. Your Directors also acknowledges gratefully the shareholders for their support and confidence reposed on your Company. For and on behalf of the Board of Directors Yogesh M. Kothari Chairman Mumbai, Dated: May 8,2015 |