DIRECTORS' REPORT Dear Members, 1. Your Directors have pleasure in presenting the 29th Annual Report together with the Audited Accounts of the Company for the financial year ended March 31, 2015. 2. DIVIDEND In view of the accumulated losses, your Directors are not in a position to recommend any dividend for the year and regret the same. 3. THE STATE OF COMPANY'S AFFAIRS AND OUTLOOK During the year under review, your Company has earned a net profit after tax of Rs. 3.61 lacs as against Rs. 16.75 lacs during the previous year. The decrease is mainly on account of higher depreciation provision and compliance expenses. The Financial year 2014-15 is an important year as the Corporate Guarantee issued by the company to secure the facilities to Joint Venture Company has been annulled and assets released from equitable mortgage. Further an appeal by the excise department with a potential impact of over Rs. 17 lacs has been dismissed by the competent court. These developments will have positive impact on the outlook of the Company. During the year under review, there is no change in the nature of business. 4. BOARD MEETINGS / AUDIT COMMITTEE Board Meeting Five Board meetings were held in the year 2014-15 and the gap between two Board meetings did not exceed 120 days. The same were held on 30th May 2014, 7th July 2014, 14th August 2014, 14th November 2014 and 13th February 2015. 5. DIRECTORS' RESPONSIBILITY STATEMENT Your Directors state that: (i) in the preparation of the annual accounts, the applicable accounting standards read with the requirements set out under Schedule III to the Act, have been followed and there are no material departures from the same; (ii) 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 at the end of the financial year and of the profit of the company for the year ended on that date; (iii) the Directors 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) the Directors have prepared the annual accounts on a going concern basis. (v) the Directors have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and are operating effectively; and (vi) the Directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively. 6. STATEMENT ON INDEPENDENT DIRECTORS The Independent Directors have submitted their disclosures 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. 7. COMPANY'S POLICY RELATING TO DIRECTORS The Company's policy relating to appointment of Directors, payment of managerial remuneration, directors qualifications, positive attributes, independence of directors and other related matters as provided under Section 178(3) of The Companies Act 2013 in furnished in attachment "H" and attached to this report. The said policy is also available on Company's website www.omnitex.com . 8. COMMENTS ON QUALIFICATION, RESERVATION OR ADVERSE REMARK Statutory Auditor The Notes on Financial Statements referred to in the Auditor's report are self explanatory. There are no qualifications, adverse remark or reservations in the auditors' report. Secretarial Auditor Members attention is invited to the observation in the Report of Secretarial Auditor regarding non-appointment of KMP. The Company was in search of KMP considering the nature and size of the operations which company complied by appointing MD and CS under the category KMP in the month of May 2015. Considering the current nature and size of the operations, Company is finding it challenging to attract right talent for CFO. Further it may also drain the resources. However, to comply with the requirements company continues to lookout for a CFO. 9. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS Loans During the year Company has given ICD amounting to Rs. 50 Lacs to M/s. Centrum Capital Limited. Guarantees The Company had in the past, issued Guarantee to ICICI Bank Limited, amounting to Rs. 21 Crores, to secure facilities granted by them to the Joint Venture Compay i.e. Strata Geosystems (India) Private Limited. Upon full payment of the outstanding by the Joint Venture Company to ICICI Bank Ltd, the said guarantee was annulled during the current year. There is no outstanding guarantee as at 31st March 2015. Investments Company has not made any fresh investments during the current year. Company is carrying forward the investments made in earlier years, in the equity of joint venture company i.e. Strata Geosystems (India) Private Limited amounting to Rs. 2,93,30,880/ 10. RELATED PARTY TRANSACTIONS FORM NO. AOC -2 (Pursuant to clause (h) of sub-section (3) of section 134 of the Act and Rule 8(2) of the Companies (Accounts) Rules, 2014. Form for Disclosure of particulars of contracts/arrangements entered into by the company with related parties referred to in sub section (1) of section 188 of the Companies Act, 2013 including certain arms length transaction under third proviso thereto. 11. MATERIAL CHANGES No material changes and commitments affecting the financial position of the company occurred between the end of the financial year to which this financial statement relate and the date of the report. 12. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNING AND OUTGO Considering the present nature of activity, the provisions of Section 134(m) of the Companies Act, 2013 do not apply to your Company. There was no foreign exchange inflow or Outflow during the year under review. 13. RISK MANAGEMENT The Company has identified two major areas with potential risk that may threaten the existence of the company. 1. Investment risk The Company is continuously monitoring the performance of the joint venture Company i.e. Strata Geosystems (India) Private Limited to ensure that the company has adequate time to take necessary precautions in the event of potential loss to its investment. 2. Property risk All the properties of the company are adequately insured. 14. CORPORATE SOCIAL RESPONSIBILITY The provisions of Section 135 of the Companies Act, 2013 do not apply to your Company for the current year. 15. PERFORMANCE EVALUAITON Pursuant to the provisions of the Companies Act, 2013 the Board has carried out an evaluation of its own performance, the directors individually as well as the evaluation of the working of its Audit, Appointment & Remuneration Committees. A structured questionnaire was prepared after taking into consideration inputs received from the Directors, covering various aspects of the Board' functioning such as adequacy of the composition of the Board and its Committees, Board culture, execution and performance of specific duties, obligations and governance. A separate exercise was carried out to evaluate the performance of individual Directors including the Chairman of the Board, who were evaluated on parameters such as level of engagement and contribution, independence of judgement, safeguarding the interest of the Company and its minority shareholders etc. The performance evaluation of the Independent Directors was carried out by the entire Board. 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 Secretarial Department. The Directors expressed their satisfaction with the evaluation process 16. JOINT VENTURE During the year under review, the topline of M/s. Strata Geosystems (India) Private Limited, the Joint Venture Company has improved by almost 50% compared to previous year and the Joint Venture Company is working aggressively to further improve its performance. Company does not have any subsidiary / other associate company. No Company has become or ceased to become the subsidiary or associate company of your company during the year under review. 17. DIRECTORS Mr. Ashok M Bhawnani, a Chartered Accountant and main promoter of the Company has been inducted into the Board as Additional Director w.e.f. 29th May 2015. Mr. Narendra Kumar Dalmia, a B.Tech Graduate, part of the promoter group has been inducted into the Board as Additional Director w.e.f. 29th May 2015. He has also been appointed as Managing Director for a period of five years. Mr. Durgaprasad S Sabnis will retire by rotation at the ensuing Annual General Meeting and is eligible for re-appointment. You are therefore requested to give your consent for the appointment of Mr. Ashok M Bhawnani, Mr. Narendra Kumar Dalmia as Directors and the re-appointment of Mr. Durgaprasad S Sabnis as Director of the Company. The brief profile of Mr. Ashok M Bhawnani, Mr. Narendra Kumar Dalmia and Mr. Durgaprasad S Sabnis in compliance with the requirements of clause 49 of Listing Agreement is provided in the "Explanatory Statement" forming part of notice. During the year, in compliance with the Companies Act, 2013 the Company has appointed Mr. Amit R Dalmia as Independent Director and Ms. Geeta Pardiwalla as Independent and Women Director for a period of five years. 18. KEY MANAGERIAL PERSONNEL Mr. Narendra Kumar Dalmia, has been appointed as Managing Director for a period of five years w.e.f. 29th May 2015. Ms. Anuja More, has been appointed as Company Secretary and compliance officer w.e.f. 29th May 2015 The Company is in the process of appointing a CFO. 19. DISCLOSURE PURSUANT TO SECTION 197(12) READ WITH RULE 5 OF COMPANIES (APPOINTMENTS AND REMUNERATION) RULES 2014 A) As none of the Directors of the Company is drawing any remuneration other than sitting fees, the information in respect of ratio of remuneration of each director to the median remuneration of employees etc., are not provided to the extent not applicable. Other information are given below: 1. Percentage increase in median remuneration of employees in the financial year 2014-15 compared to financial year 2013-14 - 15.6% 2. The No of Permanent Employees on the roll of Company - 1 3. Information as per sub-rule (vii) of Rule 5 of Companies (Appointments and Remuneration) Rules 2014 B) As there were no employees drawing remuneration more than the limit prescribed under rule 5 of Companies (Appointments and Remuneration) Rules 2014 as amended from time to time, the same information is not provided. 20. AUDITORS Statutory Auditor M/s. Tembey & Mhatre, Chartered Accountants, present auditors of the Company, retires at the conclusion of the forthcoming Annual General Meeting and are eligible for re-appointment. Members are requested to ratify their re-appointment and authorize the Board of Directors to fix their remuneration. Secretarial Auditor Mr. NIRAJ TRIVEDI proprietor Company Secretaries (Membership No.FCS 3844, CP NO.3123) has been appointed as Secretarial Auditor for the financial year 2014-15. The secretarial audit report is annexed herewith. 21. DEPOSITS. The Company has not accepted / renewed any deposits during the year and is also not carrying forward any deposits. 22. SIGNIFICANT AND MATERIAL ORDER IMPACTING THE GOING CONCERN STATUS AND COMPANY'S OPERATIONS IN FUTURE No Significant and Material order was passed by any authority during the year under review impacting the going concern status and company's operation in future. 23. INTERNAL FINANCIAL CONTROLS The Company has adequate internal financial control system with reference to the Financial Statements. 24. VIGIL MECHANISM The Company has established a vigil mechanism and oversees through the Audit 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. The Vigil Mechanism Policy is available on Company's Website www.omnitex.com <http://www.omnitex.com>. 25. REPORT ON THE SEXUAL HARRESSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSEL) ACT 2013. In terms of section 22 of the Sexual Harressment of Women at Workplace (Prevention, Prohibition and Redressel) Act, 2013, we report that, during 2014-15, no case has been filed under the said act. 26. CORPORATE GOVERNANCE REPORT In terms of circular SEBI CIR/CFD/Policy Cell/7/2014 dated 15th September 2014 issued by SEBI, the amended clause 49 of Equity Listing Agreement is not mandatory for the time being in respect of Companies having paid up share capital not exceeding Rs. 10 Crores and Networth not exceeding Rs. 25 Crores as on the last day of previous financial year. In view of the above separate corporate governance report is not provided. 27. APPRECIATION The Board of Directors records its grateful thanks to all the stakeholders of the Company for their continued support and co-operation. On Behalf of the Board of Directors, Amit R. Dalmia Chairman (DIN 00210919) Place: Mumbai Date: 29th May, 2015 |