DIRECTORS' REPORT and Management Discussion & Analysis To The Members, Your Directors present the 23rd Annual Report together with Audited Accounts of your Company for the financial year ended on 31st March, 2016. DIVIDEND The Directors do not recommend any dividend on the equity shares for the year ended on 31st March, 2016. MANAGEMENT DISCUSSION AND ANALYSIS The Management Discussion and Analysis Report of your company for the financial year ended on 31st March, 2016 is as under: (a) Industry Structure and Development Your Company is engaged in the trading activities and management expects that there is huge scope of development and growth in spite of competitive market conditions. During the current financial year the company has made impressive growth in terms of turnover of the company. (b) Opportunities and Threats The Company envisages huge growth in the trading activities sector as indicated in the current financial year. But increased cost of purchases, competitive market conditions and low margins are the major threats in the trading industry. (c) Segment - Wise and Product - Wise Performance The Company operates in single segment. Therefore, no Segment - Wise and Product - Wise performance is done by the Company. (d) Outlook The Company does not foresee and major threat to the growth prospective. Since the company is presently engaged in the trading activities, there is huge scope of growth in the industry. (e) Risk and Concerns The Company has constituted a committee of Directors to identify, monitor and minimize the risk and also to identify the business opportunities. The Committee is also entrusted the job of defining the framework for identification, assessment,monitoring, and reporting of the risk and review of risk trends and its potential impact. (f) Internal Control Systems and it Adequacy The Company is availing the services of independent professionals to carry out the internal audit and ensure that recording and reporting of all transactions is adequate and proper. The necessary measures are taken to update the internal control system. The system also ensures that all the transactions are appropriately authorised, recorded and reported. All the measures are regularly reviewed by the management and necessary improvements are done. (g) Discussion on Financial Performance with respect to Operational Performance The financial performance during the current financial year in terms of sales has been very impressive and encouraging. The Company has earned profit of Rs. 2,47,806/- during the year under review. (h) Material Development in Human Resources / Industrial Relations The Company recognized the significance of human values and ensures that proper encouragement is given to the employees of the Company to motivate them. Employee's relations continued to be cordial throughout the year in the company. (i) Cautionary Statement The Statements in the "Management Discussion and Analysis Report" describe the Company's objectives, estimates and expectations, which may be a forward looking statement within the meaning of applicable laws, rules and regulations. The actual results may differ from those expressed or implied, depending upon the economic conditions and policies of the Government. OPERATIONS During the year under review, the Company continued to carry on some trading activities. Total revenue from the trading activities and other income amounted to Rs. 2,47,79,200/- as against Rs. 1,31,41,277/- in the previous year. Net profit after Depreciation and taxes has been Rs. 1,63,004 /- against Net Loss of Rs. 4,37,722/- during the previous year. The Directors are expecting better performance in the coming year. THE STATE OF AFFAIRS OF THE COMPANY The state of affairs of the Company is on the improvement track. The Directors are hopeful that in the coming years the financial strength will improve further. FINANCE (i) Share Capital The paid-up Equity Share Capital as on 31st March, 2016 was Rs.4.00 Crore. During the year under review, the Company has not issued any shares with differential voting rights nor granted stock options nor sweat equity. (ii) Fixed Deposits The Company is not accepting any fixed deposits from the public. There are no fixed deposits remaining unpaid /unclaimed with the Company as on 31st March, 2016. (iii) Particulars of loans, guarantees or investments The particulars of loans, guarantees and investments covered under the provisions of Section 186 of the Companies Act, 2013 may be taken as Nil. MATERIAL CHANGES & COMMITMENTS, IF ANY, AFFECTING THE FINANCIAL POSITION OF THE COMPANY There have been no material changes or any other commitments which may affect the financial position of the Company. RELATED PARTY TRANSACTIONS No related party transactions were entered into during the financial year 2015-16. There are no materially significant related party transactions made by the Company with Promoters, Directors, Key Managerial Personnel or other designated persons which may have a potential conflict with the interest of the Company at large. None of the Directors has any pecuniary relationships or transactions vis-à-vis the Company. The details of Related Party Policy is available on <http://mewatzinc.com/data/documents/> Policy-on-Related-Party-Transactions.pdf DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED IMPACTING THE GOING CONCERN STATUS AND COMPANY'S OPERATIONS IN FUTURE There are no significant and material orders passed by the Regulators/ Courts which would impact the going concern status of the Company and its future operations. LISTING OF SHARES The Equity Shares of the Company were listed with BSE Limited and the stock exchanges at Delhi, Jaipur, Ahmedabad and calcutta. Delhi, Jaipur and Ahmedabad stock exchanges are now non-operational/de-recognized. The securities of the Companyare suspended at BSE Ltd. The Company has made necessary application to BSE Ltd. for restoration of listing. The Company has also paid listing fee to the BSE Ltd. SHARETRANSFER SYSTEM The request regarding physical share transfers and share certificates should be addressed to Registrar and Transfer Agent. Such requests are processed within stipulated time from the date of receipt provided documents meet the stipulated requirement of statutory provisions in all respect. The share certificates duly endorsed are returned immediately to the shareholder by RTA. The details of transfer and transmission are placed before the Stakeholders Relationship Committee from time to time and the Board for noting and confirmation. DIRECTORS (i) Retirement by rotation In accordance with the applicable provisions of the Companies Act, 2013 and Articles of Association of the Company, Ms. Neena Gupta retires by rotation and is eligible for re-appointment. (ii) Declarations by Independent Directors All Independent Directors have given declarations that they meet the criteria of independence as laid down under Section 149(6) of the Companies Act, 2013 and Regulation 17 of SEBI (Listing Obligations and Disclosures Requirements) Regulations, 2015. (iii) Board Meetings During the year, Five (5) Board Meetings and Four (4) Audit Committee Meetings were convened and held. The details are given in the Corporate Governance Report. The intervening gap between the Meetings was within the period prescribed under the Companies Act, 2013. (iv) Independent Directors Meeting During the Financial Year 2015-2016 one meeting of the Independent Directors was held on 29.01.2016 to discuss the evaluation of the performance of Non-Independent Directors and the Board of Directors as a whole, evaluation of the performance of the Chairman of the Company taking into account the views of the executive and non-executive Directors and evaluation of the quality, content and timeliness of the flow of information between the management and Board which is necessary for the Board to perform its duties. (v) Details of Directors or KMP appointed / resigned during the financial year. During the year under review no Directors or KMP was appointed or resigned. COMPANY POLICY ON DIRECTORS APPOINTMENT AND REMUNERATION The Company has formulated a remuneration policy which provides the manner of selection of Board of Directors, KMP and their remuneration. In case of appointment of independent Directors, the Nomination and Remuneration Committee shall satisfy itself with regard to independent nature of the Directors viz-a-viz the company so as to enable the Board to discharge its performance and duties effectively. The Policy is also available on the website of the company at the following link <http://mewatzinc.com/data/documents/Nomination-and-Remuneration-Policy.pdf> STATEMENT INDICATING DEVELOPMENT AND IMPLEMENTATION OF RISK MANAGEMENT POLICY OF THE COMPANY The provisions of Regulation 21 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 are not applicable to the company. However, pursuant to section 134(3)(n) of the Companies Act, 2013 and Regulation 21 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 the company has constituted a Business Risk Management Committee. At present the Company has not identified any element of risk in the Company. DIRECTORS' RESPONSIBILITY STATEMENT To the best of their knowledge and belief and according to the information and explanations obtained by them, your Directors make the following statements in terms of the section 134(3)(c) of the Companies Act, 2013: (i) That in the preparation of the annual financial statements for the year ended March 31, 2016, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any; (ii) That such accounting policies, as mentioned in the Notes to the Financial Statements, have been selected and applied consistently and judgments and estimates have been made 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, 2016 and of the profit / (loss) of the Company for the year ended on that date; (iii) That proper and sufficient care has been taken 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; (iv) That the annual financial statements have been prepared on a going concern basis; (v) That proper internal financial controls were in place and that the financial controls were adequate and were operating effectively; (vi) That proper systems to ensure compliance with the provisions of all applicable laws were in place and were adequate and operating effectively. ESTABILISHMENT OF VIGIL MECHANISM The Company has a Vigil Mechanism named as Whistle Blower Policy to deal with the instances of fraud and Mismanagement, if any. The Company has constituted a committee to look into complaint raised. AUDITORS (i) Statutory Auditors M/s Manish Rustagi & Associates, Chartered Accountants, were appointed as statutory auditors of the Company upto the conclusion of 26th Annual General Meeting subject to ratification of their appointment at every annual general meeting held after 21st Annual General Meeting. They are eligible to be appointed as the statutory auditors and therefore, a resolution for the ratification of their appointment is recommended for the approval of the shareholders. (ii) Auditors Report : The observations made in the auditor's report read together with relevant notes thereon are self explanatory and hence do not call for any further comments from the Directors under section 134(3)(f) of the Companies Act, 2013. (iii) Secretarial Auditor 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 CS Baldev Singh Kashtwal, a Company Secretary in Practice, to undertake the Secretarial Audit of the Company. The Report of the Secretarial Audit is annexed herewith as "Annexure-A". (iv) Internal Auditors The Company has appointed M/s Daga Arun & Company, Chartered Accountants as internal auditors of the company pursuant to section 138 of the Companies Act, 2013 read with Rule 13 of Companies (Accounts) Rules, 2014. COMPOSITION OF AUDIT COMMITTEE The Company has constituted an Audit Committee. The details of the audit committee are given in the Corporate Governance Report which is annexed as "Annexure B" to the Board Report. STATEMENT INDICATING THE MANNER IN WHICH FORMAL ANNUAL EVALUATION HAS BEEN MADE BY THE BOARD OF ITS OWN PERFORMANCE AND THAT OF ITS COMMITTEES AND INDIVIDUAL DIRECTORS INCLUDING INDEPENDENT DIRECTORS The Nomination and Remuneration Committee constituted in compliance with section 178 of the Companies Act, 2013 read with relevant rules framed thereunder and Regulation 19 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 has laid down a framework for the evaluation of the performance of the Directors including Independent Directors and the Committees of the Board. SUBSIDIARY COMPANIES The Company does not have any subsidiary. DISCLOSURE OF RELATIONSHIP BETWEEN THE DIRECTORS Mr. Jai Prakash Gupta, Chairman & Managing Director and Ms. Neena Gupta, Director & CFO are related to each other. Other Directors are not related to each other in anyway. DETAIL OF FAMILIARIZATION PROGRAMME OF THE INDEPENDENT DIRECTORS During the year under review one familiarization Programme was conducted for the independent Directors of the Company. The details are available at <http://mewatzinc.com/data/documents/Code-of-Conduct-for-Board-Members-and-Senior->Management.pdf CORPORATE GOVERNANCE A Report on Corporate Governance along with a Certificate from the Auditors of the Company regarding compliance of the conditions of Corporate Governance pursuant to clause 49 of the Listing Agreement and Regulation 17 to 27 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 is annexed herewith as Annexure-B. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS & OUTGO Since there were no manufacturing operations during the year, information relating 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 of the Companies (Accounts) Rules, 2014, is not applicable. EXTRACT OF ANNUAL RETURN The details forming part of the extract of the Annual Return in "Form MGT-9" is annexed herewith as "Annexure - C". NUMBER OF COMPLAINTS RECEIVED AND DISPOSED OFF DURING THE YEAR AS PER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013 During the year under review the company has not received any complaint as per the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. PARTICULARS OF EMPLOYEES The provisions of Rule 5(2) & (3) of the Companies (Appointment & Remuneration of Managerial Personnel) Rules, 2014 requiring particulars of the employees to be disclosed in the Report of Board of Directors are not applicable to the Company as none of the employees was in receipt of remuneration in excess of Rs.60.00 lacs per year during the financial year 2015-16. CORPORATE SOCIAL RESPONSIBILITY The Company has formulated a CSR Policy pursuant to the provisions of the section 135 of the Companies Act, 2013 read with rules framed thereunder. At present the provisions are not applicable to the company. As and when these provisions become applicable, necessary steps will be taken to comply with the same. ACKNOWLEDGEMENT The Directors of the Company wish to thank all the concerned agencies, bankers and the employees for the co- operation, assistance and support. The Directors also duly acknowledge the trust and confidence the shareholders and investors have reposed in the Company. By the order of the Board For MEWAT ZINC LIMITED Sd/- Jai Prakash Gupta CHAIRMAN & MANAGING DIRECTOR DIN: 00253529 Date : 30/05/2016 Place : New Delhi |