DIRECTORS' REPORT Dear Members, Your Directors are pleased to present their 32nd Annual Report on the affairs of the Company together with the Audited Accounts for the financial year ended on March 31, 2015. DIVIDEND In view to conserve the resources for further growth of the company, your Directors do not recommend any dividend for the year under review. SHARE CAPITAL There is no change in share capital during the year. The Company has not issued any equity shares with differential rights during the period under review. The Company has neither issued any employee stock options nor any sweat equity shares during the period under review. FIXED DEPOSITS During the year under review, your Company has not invited or accepted any fixed deposit. DIRECTORS In accordance with provisions of the Companies Act, 2013 Mr. Abhinav Gupta- Director (DIN-02766867) will retire by rotation and, being eligible, offer himself for re-appointment. Your Directors recommend appointment of Mr. Anil Aggarwal as an Independent Director on the Board of the Company. Brief resume of the above Directors proposed to be appointed/re-appointed, nature of their expertise in specific functional areas and the name of the public Companies in which they hold the directorship and the Chairpersonship/Membership of the Committees of the Board as per provisions of clause 49 of the Listing Agreement with Bombay Stock Exchange are given in explanatory statement to resolutions of his appointment. DECLARATION BY INDEPENDENT DIRECTORS The Company has received declarations from all the Independent Directors of the Company confirming that they meet the criteria of independence as prescribed under the Companies Act, 2013 and Clause 49 of the Listing Agreement entered with Bombay Stock Exchange. PERFORMANCE EVALUATION OF BOARD OF DIRECTOR'S Pursuant to the provisions of the Companies Act, 2013 and Clause 49 of the Listing Agreement, the Board has carried out an annual evaluation of its own performance and that of its Committees as well as performance of the Directors individually. Detailed criteria was prepared by Nomination Committee for evaluating performance of the Directors including Independent Directors and the Board after taking into consideration inputs received from the Directors, covering various aspects of the Board functioning and based on that criteria the performance of individual Directors including the Chairman of the Board was evaluated . The performance evaluation of the independent Directors was carried out by the entire Board. The performance evaluation of the Chairman and non Independent Directors was carried out by the independent Directors. The details of programs for familiarization of the Independent Directors with the Company, their roles, rights, responsibility in the Company, nature of the industry in which the Company operates, business model of the Company and related matters are available on the website of the Company at the web-link: <http://ashnoortextile.com/pdf/Familiarization-Policy.pdf> CODE OF CONDUCT The Company has adopted policy on Appointment of Directors and Senior Management and succession planning for orderly succession to the Board and the Senior Management and remuneration of the Directors, Key Managerial Personnel and other employees. These Policies inter-alia include criteria for determining qualifications, positive attributes and independence of a Director. The Code of Conduct for Independent Director appointment are available on the website of the Company at the web-link: <http://ashnoortextile.com/pdf/Code-for-Independent-Directors.pdf> DETAILS OF DIRECTORS AND KEY MANAGERIAL PERSONNEL The following have been designated as the Key Managerial Personnel of the Company pursuant to sections 2(51) and 203 of the Companies Act, 2013 read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014: • Mr. Suneel Gupta - Managing Director • Mr. Girish Singh Adhikari - Chief Financial Officer • Mr. Manmeet Singh - Company Secretary Mr. Manmeet Singh has been appointed as Company Secretray/Chief Compliance Officer and Key Managerial Personnel effective from July 15, 2015. Before him Ms. Priyanka Srivastava was Company Secretary. She resigned on May 30, 2015. DIRECTORS' RESPONSIBILITIES STATEMENT Pursuant to section 134(5) of the Companies Act, 2013, your Directors, based on the representations received from the Operating Management, and after due enquiry, confirm that: a) in preparation of the annual accounts for the financial year ended March 31, 2015, the applicable accounting standards had been followed along with the explanations relating to material departures, if any; b) the directors had selected such appropriate 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 profit 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 the Companies Act, 2013 for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities; d) the directors had prepared the annual accounts for the financial year ended March 31, 2015 on a going concern basis. 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. AUDITORS AND AUDITORS' REPORT Messrs KSA & Co., Chartered Accountants, New Delhi, was appointed in previous Annual General Meeting as Statutory Auditors of the Company for a period of three years subject to ratification by the members at every Annual General Meeting. Your Directors recommend ratification of their appointment for your approval. The Notes on financial statement referred to in the Auditors' Report are self-explanatory and do not calls for any further comment. The provisions relating to Cost Audit are not applicable to the Company. SECRETARIAL AUDIT REPORT The Board had appointed Messrs Anil Arora & Associates, Company Secretaries, Delhi as Secretarial Auditors as per provisions of section 204 of the Companies Act, 2013. The report of Secretarial Auditors is annexed as 'Annexure-1'. There are following qualification in their Report. The Company is not having 2/3rd of its directors who are liable to retire by rotation as per provisions of section 152(6) of the Companies Act, 2013. Your Directors recommend resolution to convert the period of office of Mrs. Sangeeta Gupta, Whole Time Director of the Company, from a non retiring Director to Director liable to retire by rotation for your approval at ensuing annual general meeting. CORPORATE GOVERNANCE Your Company has taken adequate steps to ensure compliance with the provisions of Corporate Governance Report as prescribed under the listing agreement with the Bombay Stock Exchange. A detailed report on Corporate Governance is annexed to Annual Report along Management Discussion and Analysis Report and a certificate issued by the Statutory Auditors of the Company. PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES During the year, the Company had not entered into any contract/arrangement/ transaction with related parties which could be considered material in accordance with the policy of the Company on materiality of related party transactions. The Related Party Transactions Policy as approved by the Board is uploaded on Company's website at the weblink:<http://ashnoortextile.com/pdf/POLICY-ON-RELATED-PARTY-TRANSACTIONS.pdf> NUMBER OF BOARD MEETINGS During the year, nine (9) meetings of the Board of Directors of the company were convened and held. Details of these meetings are given in Corporate Governance Report. CORPORATE SOCIAL RESPONSIBILITY The provisions of section 135 of the Companies Act, 2013 and Companies (Corporate Social Responsibility Policy) Rules, 2014 are not applicable to the Company. AUDIT COMMITTEE The Company has constituted an Audit Committee as per provisions of Clause 49 of the Listing Agreements with the Bombay Stock Exchange and Section 177 of the Companies Act, 2013, which comprised of Mr. Piyush Gupta as Chairman and Mr. Indermohan Aggarwal and Mr. Suneel Gupta as the members. During the year, four (4) meetings of Committee were convened and held. More details of the Committee are given in Corporate Governance Report. NOMINATION & REMUNERATION COMMITTEE The Company has constituted a Nomination and Remuneration Committee as per provisions of Clause 49 of the Listing Agreements with the Bombay Stock Exchange and Section 178 of the Companies Act, 2013, which comprised of Mr. Piyush Gupta as Chairman and Mr. Indermohan Aggarwal and Mrs. Pallavee R. Duggall as the members. During the year, five (5) meetings of Committee were convened and held. More details of the Committee are given in Corporate Governance Report. The Nomination and Remuneration Policy as approved by the Board is uploaded on Company's website at the weblink: <http://ashnoortextile.com/pdf/NOMINATION-AND-REMUNERATION-POLICY.pdf> BUSINESS RISK MANAGEMENT Pursuant to section 134(3)(n) of the Companies Act, 2013, the Company has implemented an integrated risk management approach through which it reviews and accesses significant risk and control. The audit Committee has oversight in the area of financial risk and control. At present the Company has not find any element of risk and control. At present the Company has not identified any element of risk which may threaten the existence of the Company. The Company has prepared policy to identify and assess business risk. EXTRACT OF ANNUAL RETURN The extract of Annual Return, in format MGT-9, for the Financial Year 2014-15 is annexed to this report as 'Annexure-2'. SUBSIDIARY, JOINT VENTURE OR ASSOCIATES The Company does not have any Subsidiary, Joint Venture or Associates. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS There are no significant, material orders passed by the regulators or courts, which would impact the going concern status of the Company and its future operation. LISTING AGREEMENT COMPLIANCE The Company is committed to maintain the highest standards towards adhere to the Listing Agreement requirements as set out by Bombay Stock Exchange. The Company has also implemented several best corporate governance practices as prevalent globally. The report on Corporate Governance as stipulated under the Listing Agreement forms an integral part of Annual Report. The requisite certificate from the Auditors of the Company confirming compliance with the conditions of corporate governance is attached to the report on Corporate Governance. INTERNAL FINANCIAL CONTROL The Company has in place adequate internal financial controls with reference to financial statements. During the year, such controls were tested and no reportable material weakness in the design or operation was observed. A detailed note has been provided under Management Discussion and Analysis Report. CONSERVATION OF ENERGY, TECHNOLOGY, ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO The particulars relating to conservation of energy, technology absorption, foreign exchange earnings and outgo, as required to be disclosed under the Act, are provided in 'Annexure 3' to this Report. VIGIL MECHANISM The Vigil Mechanism as envisaged Section 177(9) of the Companies Act, 2013 read Rule 7 of the Companies (Meetings of Board and its Powers) Rules, 2014 and clause 49 of the Listing Agreement is implemented through the Company's Whistle Blower Policy to enable the Directors and employees of the Company to report genuine concerns, to provide for adequate safeguards against victimization of persons who use such mechanism and make provision for direct access to the Chairperson of the Audit Committee. Whistle Blower Policy of the Company is available on the Company's website at the web-link:<http://ashnoortextile.com/pdf/Vigil-Mechanism-Whistle-Blower-policy.pdf> Further details are available in the Report on Corporate Governance that forms part of this Annual Report. PREVENTION OF INSIDER TRADING The Company has adopted a Code of Conduct for Prevention of Insider Trading with a view to regulate trading in securities by the Directors and designed employees of the Company. The Board is responsible for implementation of the code which is available on the Company's website at the web-link: <http://ashnoortextile.com/pdf/Code-of->Fair-Disclosure.pdf MANAGERIAL REMUNERATION Details pertaining to remuneration as required under section 197(12) read with Rule 5(1) of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 Remuneration of Mr. Suneel Gupta, Managing Director and Mrs. (Dr.) Sangeeta Gupta was increased, at the recommendation of Nomination and Remuneration Committee, from Rs.350,000/- to Rs.700,000/- per month effective from November 1, 2014. This increase was subject to approval of the members in general meeting by passing of special resolutions. Your Directors, therefore, recommends resolutions to increase in remuneration of Managing Director and Whole Time Director for your approval. PARTICULARS OF LOAN, GUARANTEES AND INVESTMENTS UNDER SECTION 186 During the year, the Company has not given any Loan and Corporate Guarantee. However, it has made investment as given in note number 12 in Balance Sheet. BOARD EVALUATION The Board has carried out an Annual Performance Evaluation of its own performance and the Directors individually as per provisions of Schedule IV of the Companies Act, 2013 and clause 49 of the Listing Agreement. Evaluation of performance of Non-independent Directors, Chairperson and the Board as a whole was done by the independent Directors by convening and holding their separate meeting. Further, evaluation of performance of independent Directors was done by entire Board including independent Directors excluding Directors being evaluated. ACKNOWLEDGMENT Your Directors take this opportunity to express their thanks to Banks, Central and State Government Authorities, Stock Exchange, Regulatory Authorities and stakeholders for their continued co-operation and support to the Company. The Board also places on record its appreciation for the dedicated efforts put on by the employees of the Company at all levels and also thanks to customers, clients, vendors and other business associates for their continued support Sd/- Suneel Gupta Managing Director DIN-00052084 Sd/- Sangeeta Gupta Director DIN-00052121 Place: Gurgaon Date: September 1, 2015 |