DIRECTORS' REPORT TO THE MEMBERS The Directors have pleasure in presenting the Twenty First Annual Report of the Company together with its Audited Statement of Profit and Loss for the year ended March 31, 2015 and the Balance Sheet as on that date DIVIDEND Your Directors have recommended a dividend of Rs.1.50 per equity share of the face value of Rs.10/ each. for the financial year ended March 31, 2015. The dividend payout is subject to approval of the members at the ensuing Annual General Meeting. CONSOLIDATED FINANCIAL STATEMENTS In accordance with the Companies Act, 2013 ("The Act ") and Accounting Standard (AS) - 21 on Consolidated Financial Statements, the audited consolidated financial statement is provided in this Annual Report. SUBSIDIARIES, JOINT VENTURES AND ASSOCIATE COMPANIES Bituminex Cochin Pvt Ltd (BCPL), is the Wholly Owned Subsidiary (W.O.S ) of your Company. The Consolidated Financial Statements of the Company and its Wholly Owned Subsidiary prepared in accordance with the relevant Accounting Standards of the Institute of Chartered Accountants of India, duly audited by the Statutory Auditors, form a part of the Annual Report and are reflected in the Consolidated Accounts. Pursuant to the provisions of Section 129(3) of the Act, a statement containing salient features of the financial statements of the Company's subsidiaries in Form AOC-1 is attached to the financial statements of the Company. Pursuant to the provisions of Section 136 of the Act, the financial statement of the Company, consolidated financial statements along with relevant documents and separate audited accounts in respect of subsidiary are available on the website of the Company. MANAGEMENT'S DISCUSSION AND ANALYSIS REPORT Management's Discussion and Analysis Report for the year under review, as stipulated under Clause 49 of the Listing Agreement with Stock Exchanges is presented in a separate section forming part of this Annual Report. CORPORATE SOCIAL RESPONSIBILITY The provisions of Section 135 of the Companies Act, 2013 read with the Companies (Corporate Social Responsibility Policy) Rules, 2014, with regard to Corporate Social Responsibility shall be applicable with effect from the financial year 2015-16. INTERNAL FINANCIAL CONTROLS AND THEIR ADEQUACY The Company has in place adequate internal financial controls commensurate with the size, scale and nature of its operations. The Internal Auditor monitors and evaluates the efficacy and adequacy of internal control systems in the Company, its compliance with operating systems, accounting procedures and policies at all locations of the Company. VIGIL MECHANISM / WHISTLE BLOWER POLICY The Company has adopted a Whistle Blower Policy to provide a mechanism for the Directors and employees to report genuine concerns about any unethical behavior, actual or suspected fraud or violation of the Company's Code of Conduct. The provisions of this policy are in line with the provisions of Section 177 (9) of the Act and the revised Clause 49 of the Listing Agreement. The Whistle Blower Policy can be accessed on the Company's website- www.aicltd.in EXTRACT OF ANNUAL RETURN The details forming part of the extract of the Annual Return in Form MGT-9 is annexed herewith as Annexure I. AUDIT COMMITTEE Details pertaining to the composition of Audit Committee are included in the Corporate Governance Report, which forms part of the Annual Report. RELATED PARTY TRANSACTIONS All Related Party Transactions (RPTs) that were entered into during the financial year were on an arm's length basis and in the ordinary course of business. However, as abundant precaution, the requisite approvals of the Audit Committee, the Board and Members were duly obtained. The Policy on materiality of related party transactions may be accessed on the Company's website- www.aicltd.in Yours Directors draw attention of the members to Discussion and Analysis Report for the year under review, attached to this Annual Report for related party disclosures. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS UNDER SECTION 186 OF THE COMPANIES ACT, 2013, ("THE ACT") Particulars of loans given, investments made and securities provided are mentioned in the financial statement under Note 12, 13, 15 and 18 of the said statement. Your Company has not provided any guarantee or given security in connection with loan to any other body corporate or person. RISK MANAGEMENT The Company has constituted a Risk Management Committee, details of which are set out in the Corporate Governance Report. The Company has adopted a Risk Management Policy, pursuant to the provisions of Section 134 of the Act, which has a Risk Management framework to identify and evaluate business risks and opportunities. This framework seeks to create transparency, minimize adverse impact on business objective and enhance the Company's competitive advantage. The risk framework defines the risk management approach across the enterprise at various levels including documentation and reporting. DIRECTORS AND KEY MANAGERIAL PERSONNEL (KMP) In terms of Section 149 of the Act and pursuant to the provisions of Clause 49 of the Listing Agreement with the Stock Exchanges, the Members, in the previous Annual General Meeting of the Company held on September 30, 2014, appointed Mr. Jaswant D. Sharma, Mr. Rajkumar Mehta, Mr. Harikrishna Patni and Mr. Alok Bharara, and Ms. Priti Lodha (Woman Director) as Independent Directors of the Company for a period of five years commencing from September 30, 2014. Mr. R. T. Rajguroo, an Independent Director resigned from the Board with effect from 16/4/2014 and the Board placed on record its appreciation for his valuable contribution to the progress of the Company. The Company has received declarations from all the Independent Directors confirming that they meet the criteria of independence as prescribed both under the Act and Clause 49 of the Listing Agreement with the Stock Exchanges. Further, Members in the previous Annual General Meeting of the Company also, in accordance with the Act and the Articles of Association of the Company, modified the appointment of Mr. Jaiprakash Agarwal, Mr. Lalit Agarwal and Mr. Ramchandra Agarwal as Directors, liable to retire by rotation. In terms of Section 203 of the Act the following were designated as KMP of your Company by the Board: Mr. Jaiprakash Agarwal, Managing Director. Mr. Lalit Agarwal, Whole Time Director Mr. Ramchandra Agarwal, Whole Time Director Mr. Rakesh Bhalla, - CFO & Company Secretary BOARD MEETINGS During the year under review, 12 (Twelve) Board Meetings were held and the intervening gap between the meetings did not exceed the period prescribed under the Act, the details of which are given in the Corporate Governance Report. BOARD EFFECTIVENESS The Company has adopted the Governance guidelines which, inter alia, cover aspects related to composition and role of the Board, Directors, Board diversity, definition of independence, Director's term and Committees of the Board. It also covers aspects relating to nomination, appointment, induction and development of Directors, Directors remuneration, Code of Conduct, Board Effectiveness Review and mandates of Board Committees. A. Board Evaluation The Board of Directors has carried out an annual evaluation of its own performance, Board Committees and individual Directors pursuant to the provisions of the Act and the corporate governance requirement as prescribed by Securities Exchange Board of India (SEBI) under Clause 49 of the Listing Agreement. The performance of the Board was evaluated by the Board after seeking inputs from the Directors on the basis of the criteria such as the Board Composition and structures, effectiveness of board processes, information and functioning, etc. The performance of the committees was evaluated by the Board after seeking inputs from the committee members on the basis of the criteria such as the composition of committees, effectiveness of committee meetings, etc. The Board and the Nomination and Remuneration Committee (NRC) reviewed the performance of the individual Directors on the basis of the criteria such as the contribution of the individual Director to the Board and Committee meetings like preparedness on the issues to be discussed, meaningful and constructive contribution and inputs in meetings, etc. In a separate meeting of Independent Directors, performance of Non-Independent Directors, performance of the board as a whole was evaluated, taking into account the views of the Executive Directors and Non-Executive Directors. The same was discussed in the Board meeting that followed the meeting of the Independent Directors, at which the performance of the Board, its committees and individual Directors was also discussed. B. Appointment of Directors and Criteria for determining qualifications, positive attributes, independence of a Director The NRC is responsible for developing competency requirements for the Board based on the industry and strategy of the Company. The NRC reviews and meets potential candidates, prior to recommending their nomination to the Board. At the time of appointment, specific requirements for the position, including expert knowledge expected, is communicated tojhe appointee The NRC 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 as stated under: Independence: A Director will be considered as an 'Independent Director' if he/ she meets with the criteria for 'Independence' as laid down in the Act, Clause 49 of the Listing Agreement. Competency: A transparent Board nomination process is in place that encourages diversity of thought, experience, knowledge, perspective, age and gender. It is ensured that the Board has a mix of members with different educational qualifications, knowledge and with adequate experience in banking and finance, accounting and taxation, economics, legal and regulatory matters. Additional Positive Attributes: • The Directors should not have any other pecuniary relationship with the Company, its subsidiaries, associates or joint ventures and the Company's promoters, except as provided under law. • The Directors should maintain an arm's length relationship between themselves and the employees of the Company, as also with the Directors and employees of its subsidiaries, associates, joint ventures, promoters and stakeholders for whom the relationship with these entities is material. • The Directors should not be the subject of proved allegations of illegal or unethical behaviour, in their private or professional lives. • The Directors should have the ability to devote sufficient time to the affairs of the Company. C. Remuneration Policy The Company had adopted a Remuneration Policy, subject to review from time to time for the Directors, KMP and other employees, pursuant to the provisions of the Act and Clause 49 of the Listing Agreement. The key principles governing the Company's Remuneration Policy are as follows: Remuneration for Independent Directors and Non-Independent Non-Executive Directors • Independent Directors (ID) and Non-Independent Non-Executive Directors (NINED) may be paid sitting fees for attending the meetings of the Board and of Committees of which they may be members. • Overall remuneration should be reasonable and sufficient to attract, retain and motivate Directors aligned to the requirements of the Company, taking into consideration the challenges faced by the Company and its future growth imperatives. • Remuneration paid should be reflective of the size of the Company, complexity of the sector/ industry/Company's operations and the Company's capacity to pay the remuneration and be consistent with recognized best practices. • The remuneration payable to Directors shall be inclusive of any remuneration payable for services rendered in any other capacity, unless the services rendered are of a professional nature and the NRC is of the opinion that the Director possesses requisite qualification for the practice of the profession. Remuneration for Managing Director (MD)/ Executive Directors (ED)/ Key Managerial Personnel (KMP)/ rest of the Employees , • The extent of overall remuneration should be sufficient to attract and retain talented and qualified individuals suitable for every role. Hence remuneration should be market competitive, driven by the role played by the individual, reflective of the size of the Company, complexity of the sector/ industry/ Company's operations and the Company's capacity to pay, consistent with recognized best practices and aligned to any regulatory requirements. • Basic/ fixed salary is provided to all employees to ensure that there is a steady income in line with their skills and experience. It is affirmed that the remuneration paid to Directors, KMP and all other employees is as per the Remuneration Policy of the Company. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS During the year under review, no significant material orders were passed by the regulators or courts or tribunals impacting the going concern status and the Company's operations. STATUTORY AUDITORS At the Annual General Meeting, the Members will be requested to ratify the re-appointment of M/s Ladha Singhal & Associates, Chartered Accountants, 209, Apollo Complex, R.K.Singh Marg, Off. Parsi Panchayat Road, Near Sona Udyog, Andheri [East], Mumbai - 400069, as the Auditors of the Company to hold office from the conclusion of this Annual General Meeting till the conclusion of the next Annual General Meeting at such remuneration as may be mutually agreed upon between the Board of Directors of the Company and the Auditors. They have confirmed their eligibility to the effect that their re-appointment, if made, would be within the prescribed limits under the Act and they are not disqualified for re-appointment. The notes on financial statement referred to in the Auditors' Report are self explanatory and donot call for any further comments. The Auditors' Report does not contain any qualification, reservation or adverse remark. SECRETARIAL AUDIT The Board of Directors of your Company has appointed Mr. P.M. Vala, Practicing Company Secretary (Membership No.4237-FCS- 5193, CP- 4237 ) to undertake the Secretarial Audit of the Company for the financial year 2014-15. The Secretarial Audit Report is annexed herewith as Annexure II. The report does not contain any qualifications, reservation or adverse remarks. COST AUDITORS Pursuant to the provisions of Section 148 and other applicable provisions, if any, of the Companies Act, 2013 and the Companies ( Cost Records and Audit ) Rules, 2014 (including any statutory modification(s) or re-enactments thereof, for the time being in force), the Board of Directors of the Company appointed Mr. Vinayak Kulkarni, Cost Accountant (Membership No - 28559 ) as the Cost Auditors to conduct the cost records of the Company for relevant segments for the financial year ending March 31, 2016., CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO As required under Section 134(3)(M) of the Act, read with Rule 8 of the Companies (Accounts) Rules, 2014, the information relating to Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo, during the financial year ended March 31, 2015 is given as below : (A) Conservation of Energy a) The following measures are taken for conservation of electrical energy: (i) Energy consumption remains under strict vigil of the factory management. (ii) Evenly distribution of loads throughout the day reduces the maximum demand which improvise plant and equipment efficiency. (iii) improvisation of power factor by using right type of power improvement capacitors. b) Additional Investments and proposals, if any, being implemented for reduction of consumption of energy. A few proposals in this regard are under consideration of the Company. c) Impact of measures (a) and (b) results in reduction in number of units consumed and consequently lowering of overall cost of production. (B) Technology Absorption: Company uses indigenous technology for our operations and the management keeps on reviewing and analyzing the means and methods by which the existing technology can be modified, upgraded or improved upon for better operations. It has yet to establish a separate research and development division for this purpose. PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES. The disclosure required to be furnished pursuant to Section 197 (12) read with Rule 5 (1) of The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is appended as Annexure III to this report. However, since there were no employees drawing remuneration in excess of the limits set out in the aforesaid rules, the particulars of employees required to be furnished pursuant to Section 197 (12) read with Rule 5 (2) and Rule 5 (3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 does not forms part of this Annual Report. FIXED DEPOSITS The Company did not accept any Fixed Deposits from the public and no fixed deposits were outstanding or unclaimed as on March 31, 2015. LISTING OF SHARES The equity shares of your Company have been listed on the BSE and the National Stock Exchange .The listing fees for the year 2015-16 have been duly paid. DIRECTORS' RESPONSIBILITY STATEMENT Your Directors state and confirm that: (i) in the preparation of the annual accounts for the financial year ended March 31, 2015, the applicable accounting standards read with requirements set out under Schedule III to the Act , have been followed and that 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 were 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 profits 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 accounts for the financial year ended March 31, 2015 on a 'going concern' basis; (v) the Directors have laid down internal financial controls to be followed by the Company and that such financial controls are adequate and are operating effectively; (vi) the Directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems are adequate and are operating effectively. CORPORATE GOVERNANCE Your Company ensures maintaining highest standards of corporate governance as per corporate governance requirements formulated by SEBI. The report on Corporate Governance as per Listing Agreement forms an integral part of the Annual Report. The requisite certificate from the Auditors of the Company confirming compliance with the conditions of corporate governance is attached to report on corporate governance. ACKNOWLEDGEMENT The Directors express their deep sense of appreciation for the contribution made by the employees to the significant improvement in the operations of the Company. The Directors also thank all their Bankers, Members, Customers, Lenders, Vendors, Business Partners, and all concerned Regulatory Authorities for their continued co-operation and support. On behalf of the Board of Directors Sd/- Jaiprakash Agarwal Chairman Place : Mumbai Date : August 29, 2015 Registered Office: Eastern Court, Unit No. 201-202, Plot No. 12, V.N. Purav Marg. S.T. Road, Chembur, Mumbai - 400071. |