DIRECTORS' REPORT TO, THE MEMBERS, M/S. HARIA EXPORTS LIMITED MUMBAI. Your Directors have pleasure in presenting their Annual Report on the business and operation of the Company and the accounts for the Financial Year ended March 31st, 2015. Operational Performance • Revenue from operations during the year is Rs.0.19 Cr as compared to previous year Rs.2.68 Cr. • The Company has suffered a Loss during the year is Rs.0.32 Cr as Compared to Last Year's Loss of Rs.1.80 Cr. Management Discussion & Analysis The detailed Management Discussion & Analysis Report for the year under review, as stipulated under Clause 49 of the Listing Agreement is presented in a separate section forming part of the Annual Report. Dividend In view of the losses incurred by the Company during the financial year under review your Directors are unable to recommend any dividend for F.Y. 2014-2015. Transfer to Reserves The Company has not transferred any amount to the Reserves during the Year under Review. Brief description of the Company's working during the year/State of Company's affair The Company is in the Business of Manufacturing of Notebooks and Plastic Preform and also engaged in trading of goods. The Company has during the Year under review earned Income from Sale of Products. Change in the nature of business, if any No Changes have occurred in the Nature of the Business during the Year under Review Material changes and commitments, if any, affecting the financial position of the company which have occurred between the end of the financial year of the company to which the financial statements relate and the date of the report No Material changes and commitments affecting the financial position of the company have occurred between the end of the financial year of the company to which the financial statements relate and the date of the report. Details of significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and company's operations in future No Significant and Material Orders have been passed by the regulators or courts or tribunals impacting the going concern status and company's operations in future during the Year under Review. Details in respect of adequacy of internal financial controls with reference to the Financial Statements. Your Company has in place adequate internal financial controls with reference to financial statements. Your Company has adopted the policies and procedures for ensuring the orderly and efficient conduct of its business, including adherence to the Company's policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records and the timely preparation of reliable financial disclosures. Details of Subsidiary/Joint Ventures/Associate Companies and Financial Performance thereof The Company has neither any Subsidiary Company nor any Associate Companies. Further No Company has ceased to be the Subsidiary Company during the Year under Review. Hence there is nothing to Report in this Matter. Deposits The Company has not accepted any Deposits within the meaning of section 73 of the Companies Act, 2013 and the Rules made there under. Hence, there is nothing to Report in this Matter. The Company has however repaid the Unsecured Loans from Inter-Corporate Deposits. Auditors: Statutory Auditors SUNDERJI GOSAR & CO Statutory Auditors of the Company hold office until the conclusion of the ensuing Annual General Meeting and being eligible to offer themselves for re-appointment. M/s SUNDERJI GOSAR & CO,have furnished a certificate, confirming that if re-appointed, their re-appointment will be in accordance with Section 139 read with Section 141 of the Act. Pursuant to the provisions of the Act and the Rules made there under, it is proposed to appoint M/s SUNDERJI GOSAR & CO; as the statutory auditors of the Company from the conclusion of the forthcoming AGM till the conclusion of the next Annual General Meeting, subject to ratification at every subsequent Annual General Meeting held after this Annual General Meeting. Members are requested to consider the re-appointment of M/s SUNDERJI GOSAR & CO and authorize the Board of Directors to fix their remuneration. Secretarial auditors: Pursuant to the provisions of Section 204 of the Act and The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Board of Directors of the Company had appointed CS. Milind Nirkhe, Practicing Company Secretary (Proprietor), Practicing under the name & style M/S Milind Nirkhe & Associates, CP No: 2312 to undertake the Secretarial Audit of the Company for the year ended 31st March, 2015. The Secretarial Audit Report is annexed as Annexure. The Secretarial Audit Report for the financial year ended March 31, 2015 contain certain qualification, reservation, adverse remark or disclaimer & which are suitably replied by the Board in their Report. Cost Auditor: The Company is engaged in the Manufacturing of Plastic Preform and the Manufacture of Notebooks. The following falls under table "C" under the CETA Heading 3901 to 3914, 3916 to 3921;3925. However Since, the Overall turnover of the Company is neither rupees 100 crores or more and nor is the Turnover rupees 35 crore from individual products during the Year thus it was not required to appoint a Cost Auditor during the Year under Review. Auditors' Report Comments made by the Statutory Auditors in the Auditors' Report are self- explanatory and do not require any further clarification. Share Capital The paid up Equity Share Capital as on March 31, 2015 was Rs. 115,500,000/- during the year under review. The Company has not issued any shares. Shares with Differential Voting Rights The Company has not issued shares with differential voting rights during the year Issued Employee Stock Options / ESOP The Company has not issued employee stock options and does not have any scheme to fund its employees to purchase the shares of the Company Issue of Sweat Equity The Company has not issued sweat equity shares during the year Extract Of Annual Return Pursuant to Section 92 (3) of the Act and Rule 12 (1) of The Companies (Management and Administration) Rules, 2014, the extract of Annual Return in form MGT.9 is annexed as Annexure I. Conservation of energy, technology absorption and foreign exchange earnings and outgo The Information Regarding Conservation of Energy & Technology Absorption is provided for in Annexure II Directors: A) Changes in Directors and Key Managerial Personnel Appointments and changes in Designation during the Year under Review. 1) Mr. Kamala Kantilal Haria was appointed as an Additional Director on 31/03/2015 to hold office till the Conclusion of the ensuing Annual General Meeting of the Company. 2) Mr. Mohith Ramamurthy Suddala was appointed as an Additional director on 01/10/2014 to hold office till the Conclusion of the ensuing Annual General Meeting of the Company. 3) Mr.Sunil Mistry ceased to be a Director of the Company on account of non re-appointment at the Forty Fourth Annual General Meeting of the Members of the Company w.e.f. 29/09/2014. B) Declaration by an Independent Director(s) and re- appointment, if any The Company has received Declaration from Independent directors Pursuant to the Provisions of Section 149 subsection (6") of the Companies Act, 2013 C) Annual Evaluation Of Board Performance And Performance Of Its Committee And Of Director : Pursuant to the provisions of the Companies Act, 2013 the Board had carried out evaluation of its own performance, performance of the Directors as well as the evaluation of the working of its Committees. The Nomination and Remuneration Committee has defined the evaluation criteria, procedure and time schedule for the Performance Evaluation process for the Board, its Committees and Directors. The Board's functioning was evaluated on various aspects, including inter alia degree of fulfillment of key responsibilities, Board structure and composition, establishment and delineation of responsibilities to various Committees, effectiveness of Board processes, information and functioning. Directors were evaluated on aspects such as attendance and contribution at Board/ Committee Meetings and guidance/ support to the management outside Board/ Committee Meetings. In addition, the Chairman was also evaluated on key aspects of his role, including setting the strategic agenda of the Board, encouraging active engagement by all Board members and motivating and providing guidance to the Managing Director & CEO. Areas on which the Committees of the Board were assessed included degree of fulfillment of key responsibilities, adequacy of Committee composition and effectiveness of meetings. The performance evaluation of the Independent Directors was carried out by the entire Board, excluding the Director being evaluated. The performance evaluation of the Chairman and the Non Independent Directors was carried out by the Independent Directors who also reviewed the performance of the Board as a whole. The Nomination and Remuneration Committee also reviewed the performance of the Board, its Committees and of the Directors. The Chairman of the Board provided feedback to the Directors on an individual basis, as appropriate. Significant highlights, learning and action points with respect to the evaluation were presented to the Board. D) Woman Director In terms of the provisions of Section 149 of the Companies Act, 2013 a company shall have at least one Woman Director on the Board of the Company. Your Company has appointed Ms. Kamala Haria as an Additional Director on the Board w.e.f March 31, 2015, who holds office till the date of the ensuing Annual General Meeting of the Company. Audit Committee : Audit Committee of the Company as constituted by the Board is headed by Mr. Nitin Vasudev Oza, Mr. Mohith Ramamurthy Suddala and Mr. Manish Kantilal Haria as Members. There have not been any instances during the year when recommendations of the Audit Committee were not accepted by the Board. All the recommendations made by the Audit Committee were accepted by the Board. Details of establishment of vigil mechanism for directors and employees The Company has adopted a Whistle Blower Policy, to provide a formal mechanism to the Directors and employees to report their concerns about unethical behaviour, actual or suspected fraud or violation of the Company's Code of Conduct or ethics policy. The Policy provides for adequate safeguards against victimization of employees who avail of the mechanism and also provides for direct access to the Chairman of the Audit Committee. It is affirmed that no personnel of the Company has been denied access to the Audit Committee. Nomination and Remuneration Committee The Managing Directors of the Company are entitled for payment of Remuneration as decided by the Board of Directors, based on the recommendation of the Remuneration Committee. No remuneration is paid to any Non- Executive Directors during the financial year 1st April, 2014 to 31st March 2015 except sitting fee for attending Board meetings and committee meetings. Internal Financial Controls Your Company has in place adequate internal financial controls with reference to financial statements. Your Company has adopted the policies and procedures for ensuring the orderly and efficient conduct of its business, including adherence to the Company's policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records and the timely preparation of reliable financial disclosures. Corporate Social Responsibility As a socially responsible Company, your Company has a strong sense of community responsibility. The Company however, does not fall within the above Criteria as laid down by the Act is not required to constitute a CSR Committee. Further the Company has been suffering a loss for the Last two Years; hence the Company has not formulated any Policy. Policy on prevention, prohibition and redressal of sexual harassment at workplace: The Company has zero tolerance for sexual harassment at workplace and has adopted a Policy on Prevention, Prohibition and Redressal of Sexual Harassment at the Workplace, in line with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the Rules there under. The Company has less than 10 Employees and hence is not required to constitute the Internal Complaints Committee. Particulars of loans, guarantees or investments under section 186 No Loans or Guarantees are given nor are any Investments made by the Company under Section 186 of the Companies Act, 2013. Particulars of contracts or arrangements with related parties: The Particulars of Contracts or arrangements with related Parties is provided for in Annexure III (AOC-2) Secretarial Audit Report A Secretarial Audit Report given by M/s Milind Nirkhe & Associates, a company secretary in practice shall be annexed with the report. The Following Qualifications have been observed by the secretarial Auditor during the Audit Period Risk Management Your Company has adopted a Risk Management Policy/ Plan in accordance with the provisions of the Companies Act, 2013 and Clause 49 of the Listing Agreement. It establishes various levels of accountability and overview within the Company, while vesting identified managers with responsibility for each significant risk. The Company has laid down procedures to inform the Audit Committee as well as the Board of Directors about risk assessment and management procedures and status. This risk management process covers risk identification, assessment, analysis and mitigation. Incorporating sustainability in the process also helps to align potential exposures with the risk appetite and highlights risks associated with chosen strategies. Related Party Transactions All Related Party Transactions that were entered into during the financial year were on an arm's length basis, in the ordinary course of business and were in compliance with the applicable provisions of the Companies Act, 2013 ('the Act') and the Listing Agreement. There were no materially significant Related Party Transactions made by the Company during the year. All Related Party Transactions are placed before the Audit Committee for approval. A statement of all Related Party Transactions is placed before the Audit Committee for its review on a quarterly basis, specifying the nature, value and terms and conditions of the transactions. Criteria for determining qualifications, positive attributes and independence of a director: The Nomination and Remuneration Committee has formulated the criteria for determining qualifications, positive attributes and independence of Directors in terms of provisions of Section 178 (3) of the Act and Clause 49 of the Listing Agreement. Independence: In accordance with the above criteria, a Director will be considered as an Independent Director' if he/ she meets with the criteria for 'Independent Director' as laid down in the Companies Act, 2013 and Clause 49 of the Listing Agreement. Qualifications: A transparent Board nomination process is in place that encourages diversity of thought, experience, knowledge, perspective, and gender. It is also ensured that the Board has an appropriate blend of functional and industry expertise. While recommending the appointment of a Director, the Nomination and Remuneration Committee considers the manner in which the function and domain expertise of the individual will contribute to the overall skill-domain mix of the Board. Positive Attributes : In addition to the duties as prescribed under the Companies Act, 2013 the Directors on the Board of the Company are also expected to demonstrate high standards of ethical behavior, strong interpersonal skills and soundness of judgment. Independent Directors are also expected to abide by the 'Code for Independent Directors' as outlined in Schedule IV to the Act. Corporate Governance Your Company has implemented all the mandatory requirements pursuant to Clause 49 of the Listing Agreement. A separate report on Corporate Governance is given as a part of the Annual Report along with the certificate received from the Practicing Company Secretary, M/s. Milind Nirkhe & Associates, Company Secretaries, confirming the compliance. Particulars Of Employees During the financial year under review, none of the Company's employees was in receipt of remuneration as prescribed under Rule 5 (2) and (3) of The Companies (Appointment and Remuneration of Managerial Personnel) Rules. Hence, no particulars are required to be disclosed in this Report. The information required under Section 197 (12) of the Act read with Rule 5 of The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, is annexed. Directors' Responsibility Statement In terms of the provisions of Section 134 (3) (c) and 134 (5) of the Companies Act, 2013, and to the best of their knowledge and belief and according to the information and explanations obtained by them and same as mentioned elsewhere in this Report, the attached Annual Accounts and the Auditors' Report thereon, your Directors confirm that: (i) in the preparation of the annual accounts, the applicable accounting standards have been followed and that there are no material departures; (ii) they 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 at the end of the financial year and of the profit of the Company for that period; (iii) they have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act, for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities; (iv) they have prepared the annual accounts on a going concern basis; (v) they have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and are operating effectively; (vi) they have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively. Acknowledgement An acknowledgement to all with whose help, cooperation and hard work the Company is able to achieve the results. By Order of the Board of Directors For Haria Exports Limited KANTILAL LAKHAMSHI HARIA Chairman & Managing Director Date : 14.08.2015 Place: Mumbai |