DIRECTORS' REPORT TO THE MEMBERS OF AUTO PINS (INDIA) LIMITED Your Directors are happy to present the Annual Report of the Company together with the Audited Accounts for the year ended June 30th 2015. PERFORMANCE During the current financial year, the turnover of the company is Rs. 107054104 as compared to Rs. 140200720 in the previous financial year. Moreover, our Company has profit of Rs. 1726444 as compared to Rs. 63167990 in the last year. DIVIDEND In order to conserve resources for expanding the business, your Directors have opined not to recommend any dividend for the year 2014-2015. SHARE CAPITAL (A) Authorised Share Capital The Authorised Share Capital of the Company stands at Rs. 70,000,000/-(divided into 7,000,000 Equity shares of Rs.10/- each). During the year, there has been no change in the Authorised Share Capital of the Company. (B) Paid-up Share Capital Equity The paid up Share Capital of the Company stands at Rs. 57,070,620/- (divided into 5,707,062 Equity shares of Rs.10/- each). During the year, there has been no change in the paid up Share Capital of the Company. HOLDING COMPANY Your Company has holding company namely Mystic Woodart Private Limited as on June 30, 2015 and holds 55.24% shares (3,152,500) in your Company. There is one associate company within the meaning of Section 2(6) of the Companies Act, 2013 ("Act"). The Details of the Holding Company are as follows: TRANSFER OF SHARES During the year under review, there was transfer of 1800 shares on 24 Day of November, 2014 and 1800 shares on 10th December, 2014. PUBLIC DEPOSITS The Company has not accepted any deposits from public and as such, no amount on account of principal or interest on deposits from public was outstanding as on the date of the balance sheet. MANAGEMENT DISCUSSIONS AND ANALYSIS As per clause 49 of the Listing Agreement with the Stock Exchanges, the Management Discussion and Analysis report is annexed as "Annexure-1" to this Report. EMPLOYEE REMUNERATION (A) The ratio of the remuneration of each director to the median employee's remuneration and other details in terms of sub-section 12 of Section 197 of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, are forming part of this report and is annexed as "Annexure - 2" to this Report. (B) The statement containing particulars of employees as required under Section 197(12) of the Companies Act, 2013 read with Rule 5(2) and Rule 5 (3) of the Companies(Appointment and Remuneration of Managerial Personnel) Rules, 2014, forms part of this report. In terms of Section 136 of the Companies Act, 2013 the same is open for inspection at the Registered Office of the Company. Copies of this statement may be obtained by the members by writing to the Company. EMPLOYEES BENEFITS Retirement benefit in the form of provident fund is a defined contribution scheme. The contributions to the provident fund are charged to the statement to the profit and loss for the year when the contributions are due. Provision has been made in the accounts for expenses of gratuity. DISCLOSURE UNDER SUB- SECTION(3) OF SECTION 134 OF COMPANIES ACT, 2013, READ WITH RULE 8(3) OF THE COMPANIES (ACCOUNTS) RULES, 2014 A. CONSERVATION OF ENERGY Your Company is not engaged in any manufacturing activity and thus its operations are not energy intensive. However, adequate measures are always taken to ensure optimum utilisation and maximum possible saving of energy. B. TECHNOLOGY ABSORPTION Your Company actively pursues a culture of technology adoption, leveraging on the advancements in technology to serve customers better, manage process efficiently and economically and strengthen control systems. The Company has maintained a technology friendly environment for its employees to work in. In keeping with the current trends in the areas of digital marketing and social media, the Company has effectively used these avenues in positioning itself in the market place and gain better Customer engagement. c. FOREIGN EXCHANGE EARNINGS & OUTGO There were no outgo in foreign exchange during the year under review. The was foreign earnings of Rs. 4247157 during the year under review. CODES, STANDARDS AND POLICIES AND COMPLIANCES THEREUNDER CODE OF CONDUCT FOR THE BOARD OF DIRECTORS AND THE SENIOR MANAGEMENT PERSONNEL Your Company has adopted a Code of Conduct for its Board of Directors and the Senior Management Personnel. The Code requires the Directors and employees of the Company to act honestly, ethically and with integrity and in a professional and respectful manner. During the year under review, the Code of Conduct was revised as per the revised Clause 49 of the Listing Agreement. A declaration by Chairman & Whole Time Director with regard to compliance with the said code, forms part of this Annual Report. CODE FOR PROHIBITION OF INSIDER TRADING PRACTICES Your Company has in place a Code for Prevention of Insider Trading Practices in accordance with the Model Code of Conduct, as prescribed under Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 1992, as amended and has duly complied with the provisions of the said code. The details of the same are provided in Corporate Governance Report forming part of this Annual Report. WHISTLE BLOWER POLICY Pursuant to the provisions of Section 177 (9) & (10) of the Companies Act, 2013 read with Rule 7 of Companies (Meetings of Board and its Powers) Rules, 2014 and Clause 49 of the Listing Agreement, the Company has adopted a Whistle Blower Policy, which provides for a vigil mechanism that encourages and supports its Directors and employees to report instances of unethical behaviour, actual or suspected, fraud or violation of the Company's Code of Conduct or Ethics Policy. It also provides for adequate safeguards against victimisation of persons who use this mechanism and direct access to the Chairman of the Audit Committee in exceptional cases. The details of the same are provided in Corporate Governance Report forming part of this Annual Report. PREVENTION, PROHIBITION & REDRESSAL OF SEXUAL HARASSMENT OF WOMEN AT WORKPLACE The Company has in place a Policy on Prevention, Prohibition & Redressal of Sexual Harassment of Women at Workplace and an Internal Complaints Committee (ICC) has been constituted thereunder. The primary objective of the said Policy is to protect the women employees from sexual harassment at the place of work and also provides for punishment in case of false and malicious representations. COMPREHENSIVE RISK MANAGEMENT POLICY Your Company has formulated and adopted a Comprehensive Risk Management Policy which covers a formalised Risk Management Structure, alongwith other aspects of Risk Management i.e. Credit Risk Management, Operational Risk Management, Market Risk Management and Enterprise Risk Management. The Risk Management Committee of the Board, on periodic basis, oversees the risk management systems, processes and minimization procedures of the Company. NOMINATION REMUNERATION & EVALUATION POLICY The Board has, on the recommendation of the Nomination & Remuneration Committee framed a Nomination Remuneration & Evaluation Policy, which, inter-alia, lays down the criteria for identifying the persons who are qualified to be appointed as Directors and/or Senior Management Personnel of the Company, alongwith the criteria for determination of remuneration of Directors, KMPs and other employees and their evaluation and includes other matters, as prescribed under the provisions of Section178 of Companies Act, 2013 and Clause 49 of the Listing Agreement. The details of the same are provided in Corporate Governance Report forming part of this Annual Report. RELATED PARTY TRANSACTION POLICY Related Party Transaction Policy, as formulated by the Company, defines the materiality of related party transactions and lays down the procedures of dealing with Related Party Transactions. The details of the same are provided in Corporate Governance Report forming part of this Annual Report. LISTING OF SECURITIES The company's shares are listed at The Bombay Stock Exchange, Mumbai. The company had applied for in-principle approval for revocation of suspension of trading in shares of the company 13th Jan, 2014 and got in-principle approval letter vide DCS/COMP/OT/SB/44/2014-15 Dated 19th June, 2014 from the Stock Exchange. Listing fees is outstanding. LOCK IN PERIOD OF SHARES: During the year under review, 3996338 equity shares were in lock-in period upto 30th April, 2016 as per the requirements of the Bombay Stock Exchange. As per the requirement of Stock Exchange, the entire promoter holding i.e. 3996338 shares as on 13th January, 2014 and any increase in shareholding thereafter upto the date of revocation should be under lock-in for a period of three months from the date of commencement of trading or post revocation suspension. Therefore the company has applied for NSDL /RTA Certificate for lock-in of abovesaid shares upto the date of 30th April, 2016. DIRECTORS AND KEY MANAGERIAL PER SONNEL: A brief resume of all the Directors, nature of their expertise in specific functional areas and names of companies in which they hold directorships, memberships/ chairmanships of Board Committees and their shareholding in the Company are provided below: SUBHASH JAIN : Mr. Subhash Jain, Executive Director aged about 61 years graduated from Delhi University in 1976 and experience in Marketing over 41 years. He has more than two decades of experience in the marketing. He has expert knowledge in the products manufactured by Auto Pins (India) Ltd. and Sirocco Pressings Pvt. Ltd. and its utilization in market. Currently he is holding distributorship of the company in Delhi and surrounding area of Sirocco Pressings Pvt. Ltd. In accordance with the requirements of the Companies Act, 2013 and the Company's Articles of Association, he is liable to retire by rotation in this AGM and being eligible, offered himself for reappointment. Directors solicit their approval for his reappointment as a director of the Company. RAJBIR SINGH: Mr. Rajbir Singh has joined the company as an Executive Director on 10th August, 1988, and started looking after the day to day functioning of the Company under the superintendence, direction, and control of the Board of Directors. Mr. Singh gained experience as head of the enterprises more particularly in the areas of production, marketing, purchases, export, automation and MIS. After being Executive Director for nearly 7 years he was elevated to the position of Managing Director of the Company on 8th June 1994. Mr. Rajbir Singh took over the management and control of the day to day affairs of the company in 1988 at the age of 25 Years. KULBIR SINGH: Mr. Kulbir Singh, Non- Executive & Independent Director graduated from MD University, Rohtak, Haryana in 1988 and experience in accounting over 27 years. He was appointed as with effect from June, 2006. He holds expertise in marketing, purchasing, administration and financial management. He has been closely involved with the company growth of Sirocco Pressings Pvt. Ltd. Presently he is a member of Board of Director of Auto Pins (India) Ltd. NAND KISHORE SHARMA: Mr. Nand Kishore Sharma , Non- Executive & Independent Director is 35 years of age and a Law graduate. He is in service since last 10 years and now has been practicing as an advocate. SHILPY CHOPRA: Ms. Shilpy Chopra , Non- Executive & Independent Director is 34 years of age and has done CS, MBA (Finance) M.Com and also a Law graduate. She is in service since last 7 years and now working as a Company Secretary. OTHERS: During the year under review, Ms. Srishti Gupta was appointed as Company Secretary on 31st October, 2014 and resigned on 30th September, 2015 DIRECTOR'S RESPONSIBILITY STATEMENT Your Directors would like to inform that the audited accounts containing the Financial Statements for the year ended 30th June, 2015 are in conformity with the requirements of the Companies Act, 2013 and they believe that the financial statements reflect fairly the form and substance of transactions carried out during the year and reasonably present the Company's financial condition and results of operations. These Financial Statements are audited by M/s. Sanjay Rawal & Co., Chartered Accountants Statutory Auditors of the Company. Pursuant to the provisions of Section 134(5) of the Companies Act, 2013, it is hereby confirmed that: (a) in the preparation of the annual accounts for the year ended June 30, 2015, the applicable Accounting Standards had been followed along with proper explanation relating to material departures, (b) 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 as at 2015 and of the profit of the Company for that period; (c) the directors had taken proper and sufficient care 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; (d) the directors had prepared the annual financial statements on a going concern basis; (e) the directors had laid down Internal Financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively; and (f) the directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively BOARD MEETINGS The Company holds at least four Board meetings in a year, one in each quarter, inter-alia, to review the financial results of the Company. The Company also holds additional Board Meetings to address its specific requirements, as and when required. All the decisions and urgent matters approved by way of circular resolutions are placed and noted at the subsequent Board meeting. Annual calendar of meetings of the Board are finalised well before the beginning of the financial year after seeking concurrence of all the Directors. During the year there were in total Six Board Meetings were held i.e. on 31st July, 2014, 31st October, 2014, 2nd December, 2014, 31st January, 2015, 31st March, 2015 and 30th April, 2015. The intervening gap between the Meetings was within the period prescribed under the Companies Act, 2013 and the Listing Agreement. The details of the Board meetings held during the year along with the attendance of the respective Directors thereat are set out in the Corporate Governance Report forming part of this Annual Report and annexed as "Annexure-3". INTERNAL AUDIT & INTERNALI INANCIAL CONTROL SYSTEMS The Company has an Internal Audit Department, headed by a Senior Management Personnel, Mr. Ankit Kapur Prop. of M/s Kapur & Associates, Chartered Accountant, was appointed as an Internal Auditor under the provisions of Section 138 of the Companies Act, 2013 who reports to the Audit Committee of the Board. The Internal Audit Department conducts comprehensive audit of functional areas and operations of the Company to examine the adequacy of and compliance with policies, procedures, statutory and regulatory requirements. Significant audit observations and follow up actions thereon are reported to the Audit Committee. The Audit Committee reviews adequacy and effectiveness of the Company's internal control environment and monitors the implementation of audit recommendations. The audit function maintains its independence and objectivity while carrying out assignments. It evaluates on a continuous basis, the adequacy and effectiveness of internal control mechanism. The function also proactively recommends improvement in policies and processes, suggests streamlining of controls against various risks. Your Company has laid down set of standards, processes and structure, which enables it to implement internal financial control across the Company and ensure that the same are adequate and operating effectively. MATERIAL CHANGE There was no material change affecting the financial position of the Company between the date of balance Sheet and the date of this Report. SECRETARIAL AUDIT REPORT Pursuant to the provisions of Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Board of Directors of the Company had appointed M/s. Parveen Rastogi & Co, Practicing Company Secretaries, to undertake the Secretarial Audit of the Company for the financial year 2014-15. The Secretarial Audit Report for the financial year ended June 30, 2015, is annexed as "Annexure - 4" to this report. The said report, does not contain any qualification, reservation or adverse remark, and thus do not call for any further comments. AUDITORS M/s Sanjay Rawal & Co., Chartered Accountants to be re-appointed as Statutory Auditors of the Company to hold office from the conclusion of this Annual General Meeting until the conclusion of the Annual General Meeting held on 2020 of the Company, as per the provisions of Companies Act, 2013, subject to their ratification by shareholders at every subsequent Annual General Meeting.. AUDITORS' REPORT & NOTES ON ACCOUNTS There are no observations (including any qualification, reservation, adverse remark or disclaimer) of the Auditors in their Audit Report that may call for any explanation from the Directors. Further, the notes to accounts referred to in the Auditor's Report are self-explanatory. AUDIT COMMITTEE & OTHER BOARD COMMITTEES The Company has a duly constituted Audit Committee as per the provisions of Section 177 of Companies Act, 2013 and Clause 49 of the Listing Agreement with the stock exchanges. The Board of Directors has constituted other committees namely - Nomination and Remuneration Committee, Share Transfer and Investor Grievance Committee and Risk Management Committee which enables the Board to deal with specific areas / activities that need a closer review and to have an appropriate structure to assist in the discharge of their responsibilities. The details of the composition of the Audit Committee alongwith that of the other Board committees and their respective terms of reference are included in the Corporate Governance Report forming part of this Annual Report. The Audit Committee and other Board Committees meet at regular intervals and ensure to perform the duties and functions as entrusted upon them by the Board. The details of the Audit Committee and other Board Committees are also set out in the Corporate Governance Report forming part of this Annual Report. INTERNAL AUDITOR The internal auditor of the company is M/s Amit Batla & Associates carried out the roles and responsibilities during the current financial year which are as follows: -evaluated and provided reasonable assurance that risk management, control, and governance systems are functioning as intended and will enable the organisation's objectives and goals to be met. -reported risk management issues and internal controls deficiencies identified directly to the audit committee and provided recommendations for improving the organisation's operations, in terms of both efficient and effective performance. -evaluated information security and associated risk exposures. -evaluated regulatory compliance program with consultation from legal counsel. EXTRACT OF ANNUAL RETURN Pursuant to Section 134(3)(a) and Section 92(3) of the Companies Act, 2013 read with Rule 12 of the Companies (Management and Administration) Rules, 2014,the extract of the Annual Return as at June 30, 2015, in the prescribed form MGT 9, forms part of this report and is annexed as "Annexure - 5". TRANSACTIONS WITH RELATED PARTIES Related party transactions entered during the financial year under review are disclosed in Note No. 2.36 of the Financial Statements of the company for the financial year ended June 30, 2015. These transactions entered were at an arm's length basis and in the ordinary course of business. There were no materially significant related party transactions with the Company's Promoters, Directors, Management or their relatives, which could have had a potential conflict with the interests of the Company. Form AOC-2, containing the note on the aforesaid related party transactions is enclosed herewith as Annexure-6. The Policy on materiality of related party transactions and dealing with related party transactions as approved by the Board may be accessed on the Company's website. PARTICULARS OF LOANS, GUARANTEES AND INVESTMENTS The particulars of loans, guarantees and investments have been disclosed in the financial statements. ACKNOWLEDGEMENT Your Directors commend the continuing commitment and dedication of employees at all levels. The Directors would also like to thank all other stakeholder, including bankers and other business associates, who have provided sustained support and encouragement. This has understandably; been critical for all the Company's success. The Directors look forward to their continued support in the years to come, By Order of the Board For Auto Pins (India) Limited Sd/- Kulbir Singh Director DIN: 02712040 Sd/- Rajbir Singh Managing Director DIN: 00176574 Place : Delhi Dated: 02-12-2015 |