Directors' Report To the Members, 1. The Board hereby presents its report for the year ended 31st March, 2015. 2. Performance Review Your company achieved turnover of Rs. 21198.99 lacs for the year ended March 31, 2015. Company incurred a net loss of Rs. 875.81 lacs during the year under review. During the year under review, your Company has crushed 6081747 QTLS of Sugarcane and produced 617402 bags of Sugar in 130 crushing days, as compared to previous year crushing of 5770462 QTLS of sugarcane and production of 579740 bags of Sugar in 129 crushing days. The capacity utilization of the plant during the year under review was 93.56% and the average recovery was 10.14 % as compared to capacity utilization of 89.68 % and average recovery of 9.79 %> in the previous year. 3. Dividend No dividend has been recommended. 4. Capital During the Financial year 2014-15 the Share Capital of the Company remains the same as that of previous year 2013-14. 5. Risk Management Policy Disclosure indicating development and implementation of a Risk Management Policy is provided in the Management Discussion and Analysis Report forming part of this Report. 6. Internal Control System and their adequacy The Company has adequate system of internal control to safeguard and protect from loss, unauthorized use or disposition of its assets. All the transactions are properly authorized, recorded and reported to the Management. The Company is following all the applicable Accounting Standards for properly maintaining the books of accounts and reporting financial statements. The internal auditor of the company checks and verifies the internal control and monitors them in accordance with policy adopted by the company. 7. Vigil Mechanism: The Company has established a Vigil Mechanism for Directors and Employees in accordance with sub-section (9) and (10) of Section 177 of the Companies Act, 2013. Details of Vigil Mechanism are given in the Corporate Governance Report under the heading of Whistle Blower Policy. The Vigil Mechanism has been disclosed on the website of the Company. 8. Corporate Social Responsibility Even though the provisions of Companies Act, 2013 regarding Corporate Social Responsibility are not attracted to the company yet the Company has been, over the years, pursuing as part of its corporate philosophy, an unwritten CSR policy voluntarily which goes much beyond mere philanthropic gestures and integrates interest, welfare and aspirations of the community with those of the Company itself in an environment of partnership for inclusive development 9. Directors and Key Managerial Personnel Shri Sanjay Singh, Executive Director shall retire at the ensuing Annual General Meeting and being eligible offers himself for re-appointment. Shri Dharampal Singh resigned as Director of the Company with effect from February 13, 2015. Shri Manish Kumar Dixit, resigned as Company Secretary of the Company with effect from close of business hours of August 14, 2015. Your Directors place on record their sincere appreciation of the valuable contribution made by the aforesaid Director and Company Secretary to the Company. Pursuant to the recommendation of the Nomination and Remuneration Committee, Shri Kunal Yadav was reappointed by the Board of Directors, subject to the approval of the shareholders, as the Executive Chairman and Managing Director of the Company on May 18, 2015 for a further period of five years with effect from June 17, 2015 to June 16, 2020. The Company has received declarations from all the Independent Directors of the Company confirming that they meet with 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. Brief resume of Directors seeking appointment/ re-appointment along with other details as stipulated under Clause 49 of the listing agreement, are provided in the Notice for convening the Annual General Meeting. 10.1. Board Evaluation Pursuant to the provisions of companies Act, 2013 and clause 49 of the Listing Agreement, the Board has carried out annual performance evaluation of its own performance, the directors individually as well the evaluation of the working of its Audit, Nomination & Remuneration and Stakeholder committee. The manner in which the evaluation has been carried out has been explained in Corporate Governance Report. 10.2 Remuneration Policy The Nomination and Remuneration Committee framed a policy for selection and appointment of Directors including determining qualifications independence of a Director, Key Managerial Personnel, Senior Management Personnel and their remuneration as part of its charter and other matters provided under Section 178(3) of the Companies Act, 2013. An extract of the policy covering these requirements is provided in the Corporate Governance report 10.3 Number of meetings of the Board The Board met fifteen (15) times in the year ended 31st March 2015 viz. on 7th May 2014, 30th May 2014, 11th July 2014, 4th August 2014, 14th August 2014, 22nd August 2014, 15th October 2014, 14th November 2014, 29th December 2014, 1st January 2015, 13th February 2015, 14th February 2015, 25th February 2015,12th March 2015 and 25th March 2015. The maximum interval between any two meetings did not exceed 120 days. 10.4 Committees of the Board The Company's Board has the following committees: 1. Audit Committee 2. Nomination and Remuneration Committee 3. Stakeholders' Relationship Committee The details of the membership and attendance of the meetings of the above Committees of the board are provided in the Corporate Governance report. 11. DIRECTORS' RESPONSIBILITY STATEMENT Your Directors hereby confirmed that: (a) in the preparation of the Annual Accounts, for the financial year ended March 31, 2015 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 as at March 31, 2015 and of the loss of the Company for the financial year; (c) the director have taken proper and sufficient care for the 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; (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 these 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 were adequate and operating effectively. 12. Related Party Transactions None of the transactions with any of related parties were in conflict with the Company's interest. Suitable disclosure as required by the Accounting Standards (AS18) has been made in the notes to the Financial Statements. All related party transactions are negotiated on an arms-length basis and are ordinary course of business. Therefore, the Provisions of Section 188(1) of the Companies Act, 2013 are not applicable. The details of the transaction with the related party are provided in the accompanying financial statements. 13.1 Material changes and commitments affecting the financial position of the Company There have been no material changes and commitments, affecting the financial position of the Company which occurred during between the end of the financial year to which the financial statements relate and the date of this report. 13.2 Significant and material orders passed by the regulators or courts There are no significant material orders passed by the Regulators / Courts. However which would impact the going concern status of the Company and its future operations. 14. Auditors 14.1 Statutory Auditors: M/s. Rakesh Grover & Co., Chartered Accountants, the retiring auditors, have expressed their unwillingness for re-appointment as Statutory Auditor of the Company. As recommended by Audit Committee and approved by the Board of Directors of the Company, in their respective meetings held on August 22, 2015, the Board has proposed the appointment of M/s. R.Dewan & Co., Chartered Accountants as Statutory Auditors for the Financial Year 2015-16, who being eligible, have indicated their willingness to serve as the statutory auditors of the Company, if appointed at the Meeting, subject to approval of the members of the Company at the ensuing Annual General Meeting. The Company has received certificate from them to the effect that their re-appointment, if made, would be within the prescribed limits under Section 141(3)(g) of the Companies Act, 2013 and that they are not disqualified for re-appointment. 14.2 Explanation to Auditor's Remarks There are no reservations or adverse remarks made in the Auditors' report. The notes to the accounts referred to in the Auditors' Report are self explanatory and no further explanation is considered necessary. However, the clarifications on the qualifications in the Auditors' Report are as under:- 1. The Company has granted loan to M/s. Yadu Sugar Ltd. in the earlier years and the balance outstanding amount is Rs. 4.94 cr. as on 31-03-2015. 2. The Company has provided guarantee in respect of KCC loan secured to the farmers (suppliers) from Banks. As per Tri-party agreement between the Indian Sucrose Ltd., farmers and banks, the banks have sanctioned KCC limit to the farmers and credited the same in the Indian Sucrose Ltd. 14.3 Cost Auditors During the financial year under review the Company has appointed M/s. Ajay Kumar Singh & Associates, Cost Accountants, Delhi as the Cost Auditors and the Cost Audit Report is required to be filed with the Central Government within 180 days from the end of financial year. M/s. Ajay Kumar Singh & Associates, Cost Accountants, have also been re-appointed as the Cost Auditors of the Company for the current financial year (2015-16) by the Board upon the recommendation of the Audit Committee. 14.4 Secretarial Auditors 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 Mr. Lalan Kumar Singh (FCS.:7837)( CP.:8544) from M/s L K Singh & Associates, a firm of Company Secretaries in Practice to undertake the Secretarial Audit of the Company. The Report of the Secretarial Audit in Form MR 3 for the Financial Year ended March 31, 2015 is annexed as Annexure A to the Report. There are no reservations or adverse remarks made by Secretarial Auditor in this report. The clarifications on the qualifications in the Secretarial Auditors' Report are self explanatory and no further explanation is considered necessary:- 1. The Company has not complied with Section 180(1)(c) of Companies Act 2013. 2. Annual Return on Foreign Liabilities and Assets for the year ended on 31.03.2014 have not filed during the period. 14.5 Internal Auditors M/s Bhola Vijesh & Associates, Chartered Accountants performs the duties of internal auditors of the company and their report is reviewed by the audit committee from time to time. 15. Corporate governance Your Company is committed to achieving the highest standards of Corporate Governance. Accordingly, your Board functions as trustees of the Shareholders and seek to ensure the long term economic value for its shareholders while balancing the interest of the stakeholders. A separate section on Corporate Governances standards followed by your Company as stipulated under clause 49 of the listing Agreement with the stock Exchange is enclosed to this report. 16. Particulars regarding Conservation of Energy The Company has taken several steps to conserve energy. Information as required under Section 134(3) (m) of the Companies Act, 2013 read with the Companies (Accounts) Rules, 2014 are given below and forms part of this Report. 17. Extract of Annual Return The extract of the Annual Return of your Company as on March 31, 2015 as provided under sub-section (3) of Section 92 in the Form MGT 9 is enclosed with this report as Annexure B 18. Listings The shares of your company are currently listed with Bombay and Calcutta Stock Exchange. Application for delisting with Calcutta Stock Exchanges is still pending and expected to be approved very soon. 19. Deposits Your Company has not accepted any fixed deposits and, as such, no amount of principal or interest was outstanding as on the Balance Sheet date. 20. Particulars of Employees The information required pursuant to Section 197 read with Rule, 5 of The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of employees of the Company form part of this report. 21. Industrial Relations Human resources are the most important resource and your directors believe in to give them their due weight age for their crucial role-playing in the overall progress of the organization. The relationship between the management and the staffs/ workers has been comfortable and cordial during the year. 22. Acknowledgement Your Directors take this opportunity to express their deep and sincere gratitude to all officers/ staffs/ workers, as team members, for their dedicated and sincere efforts and also to Bankers, creditors, suppliers and all concerned for showing their continued faith and extending their full and wholehearted support to our organization. Your Directors would also like to express their gratitude to members for their trust and support. By Order of the Board of Directors For Indian Sucrose Limited Sd/- Kunal Yadav (Chairman & Managing Director) Place: Delhi Date: 22-08-2015 |