DIRECTORS' REPORT To THE MEMBERS, Your Directors have pleasure in presenting twenty-third Annual Report on the business and operations of the Company together with the audited Statement of Accounts for the year ended 31st March 2015. OPERATIONS: Your company could not restart manufacturing activity of mushroom cultivation due to shortage of electricity. Management could not take up the idea of mushroom cultivation in the hills of Nilgiries as it was contemplating upon as the prefeasibility studies indicated a need for first establishing pilot operations before venturing in shifting the project location. Further due to continued losses of the existing unit, unavailability of adequate staff and absence of regular revenues, the cash crunch became main obstacle to go ahead undeterred on this thinking. Even though company has expertise in successful handling of mushroom business, in the new scenario of increased costs, and inadequate resources this idea remained on paper. Even in absence of any production activity, and with a disconnected electricity supply, company depended on generators to provide electricity for lighting during night, required basically for security of the premises. The same arrangement continues to date. Your company sold spent compost to generate income but this was highly inadequate to meet the negligible expenses on account of cost of diesel for operating generators for night lighting, salary of security guards, salary & wages, statutory compliance, basic minimum repairs, and other expenses on account of professional fees, etc. The need to shift the unit to hilly area was finalized and the Resolution pursuant to Section 192A of the companies Act, 1956 was passed on 1.11.2013. However as on date the unit is still not yet shifted to Hills, as management has not found a serious buyer for the purchase of Assets at prevailing rates. All the machinery and other infrastructure have already lived their life and further have been badly deteriorated as no maintenance care could be provided to during last more than 4 years. The mushroom growing process is biological and continuous in nature and it needs a supportive climate. Your company has expertise to produces fresh button mushrooms round the year. Company has no turn over from Fresh Mushrooms and during the year under review there was a nominal turnover of Rs. 6.22 lacs on account of sales of spent compost. Company made use of its spent compost which is end residue of the mushroom growing process to generate small revenue. INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACIES The company has adequate system of internal controls to ensure that all assets are safeguard, transactions are authorized, optimum utilization of resources, and costs are controlled and reporting of financial transactions and compliance with applicable law and regulations. The Company has suitable internal control system commensurate with the size of the Company and nature of its business. LIKELY DEVELOPMENTS IN HR / INDUSTRIAL RELATIONS Company has not recruited employees during the year. In absence of any regular activity they would have been idle and wasted. As the alternate site is not yet finalized and as such there is no need of employees. AUDIT COMMITTEE: As per the requirement of Section 177 of the Companies Act, 2013 and clause 49 of the Listing Agreement entered with the Stock Exchanges, your Company has constituted an Audit Committee DIRECTORS: As per the provisions of the Companies Act, 2013, Mr. Arvind Kalra, who is Non-Executive Director retire by rotation at the ensuing Annual General Meeting and is eligible for re-appointment. As per clause No.120 of Article of Association of the company and Section 161(2) of companies Act, 2013 Mr. B. Rose Advocate is appointed as Alternate director for Chairman in the meeting of the board of directors held on 13.11.2015. He holds the office up till the conclusion of 23rd Annual General Meeting. All independent directors have given declarations that they meet the criteria of independent directors as provided in the Section 149(6) of company's Act, 2013. Mr. Sudhir Singhi, C.A. Independent Director has resigned (w.e.f. 23.07.2014), board appreciates his contributions of valuable services rendered by him during his tenure. As per the provisions of section 149 of the companies, Act 2013, the amended Clause 49 of the Listing Agreement, the members of the company had at the AGM held on 29.09.2014, re-appointed the independent directors as mentioned below: he is not to retire by rotation In view of huge accumulated losses, your Directors are not in a position to recommend any dividend this year DEPOSITS: During the year, your Company has neither invited nor accepted deposits from the public. in terms of the provisions of sections 73 to 76 of the Companies Act, 2013 read with the companies acceptance of deposit rules, 2014. AUDITORS: M/s. K. Mahaveer & Co., Chartered Accountants (Firm Registration No. 006740S), has confirmed their eligibility and willingness to accept office, if ratification is made by shareholders in the Annual General Meeting. The share holders of the company are requested to approve their appointment as Statutory Auditors of the company and authorize the Board of Directors to fix their remuneration. INTERNAL AUDITORS: The Board of Directors of the company has appointed Mr. ShashiKant Mishra (Chartered Accountant) as an Internal Auditor Pursuant to provisions of section 138 of the companies Act, 2013 for the Financial Year 2015-2016. SECRETARIAL AUDITORS: The Board of Directors of the company has appointed Ms. Manisha Singhal, Practising Company Secretary (CP. No. 11424) as Secretarial Auditor pursuant to provisions of section 204 of the companies Act, 2013 for the Financial Year 2015-2016. SECRETARIAL AUDITOR'S REPORT: A Secretarial Audit Report given by Ms. Manisha Singhal, Practicing Company Secretary is being annexed in MR 3 Form. There is no qualification, reservation or adverse remark or disclaimer made by the Company Secretary in Practice in the Secretarial Audit Report. STATUTORY AUDITOR'S REPORT: Observations made in the Auditors' Report are self-explanatory except few points which have been explained in Clause (E) to Annexure to the director's report. COMPANY'S POLICY ON DIRECTORS APPOINTMENT AND REMUNERATION: The Nomination & Remuneration Committee has been constituted as per the requirements of companies Act, 2013 which shall formulate the policy for appointment of Directors and Remuneration including criteria for determining qualification, positive attributes, independence of a director and other matters as provided under section 178(3) of the companies Act, 2013. STAKEHOLDERS RELATIONS: As per the requirement of Companies Act, 2013 a stakeholder relationship committee has been constituted. CORPORATE GOVERNANCE: The company aims to conduct its affairs in an ethical manner. A certificate from the Company's Auditors regarding the compliance of conditions of corporate Governance as stipulated under clause 49 is also annexed with the report. LISTING OF SHARES & SEBI REGULATION: The Equity shares of the company are listed on The Stock Exchange Mumbai. DIRECTORS RESPONSIBILITY STATEMENT: In accordance with the provisions of Section 134 clause (C) of sub-section 3 of the Companies Act, 2013, your directors state; a. that in the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures; b. that the directors had 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; c. that the directors had 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; d. that the accounts have been prepared the annual accounts on a going concern basis. MANAGEMENT DISCUSSION & ANALYSIS Management analysis and review report mention in Corporate Governance report. PARTICULARS OF EMPLOYEES: No employee is in receipt of remuneration in excess of limits prescribed under section 134 of the Companies Act, 2013. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, EXPORTS AND FOREIGN EXCHANGE EARNINGS AND OUTGO: Information relating to conservation of energy, technology absorption and foreign exchange earnings and outgo required under Section 134 of the Companies Act, 2013 read with the Companies (Disclosure of particulars in the Report of Board of Directors) Rules, 1988, is annexed and forms a part of this report. Disclaimer: Management Discussion and Analysis forming part of this Report is in compliance with Corporate Governance Standards incorporated in the listing agreement with stock Exchanges and such statements may be "forward-looking" within the meaning of applicable securities laws and regulations. Actual results could differ materially from those expressed or implied. Important factors that could make a difference to the company's operations include economic conditions in the domestic and overseas markets on which company's performance is dependant. It may be materially influenced by changes in the Government regulations, tax laws, other statutes and other incidental factors on which company may have no control. ACKNOWLEDGMENT: Your Directors place on record their appreciation for the continued co-operation extended by its Bankers, Shareholders and employees of the Company. BY ORDER OF THE BOARD for SAPTARISHI AGRO INDUSTRIES LIMITED sd/- B.Rose Alternate Director for Chairman sd/- Arvind Kalra Director sd/- D.K.Yadav Director Place: Chennai Date : 29.05.2015 |