DIRECTOR'S REPORT To the Members Your Directors have pleasure in presenting the 19th Annual Report on the working of the Company together with the audited accounts for the year ended 31st March, 2015. OPERATIONAL REVIEW During the year under review, the total revenue of the company was Rs.9443.14 lacs as compared to Rs. 9062.96 lacs in the previous year. The operating surplus (profit before finance cost and depreciation) of the Company was Rs. 1597.13 lacs as compared to Rs.1149.19 lacs in the previous year. The Company has accounted for exceptional income of Rs. 2.18 lacs and extraordinary items of Rs. 68.65 lacs during the current year. The Company has incurred loss of Rs. 108.41 lacs for its discontinuing operation as against Rs. 88.88 lacs in the previous year. The net loss during the year was Rs. 38.61 lacs as compared to profit of Rs. 147.83 lacs in the previous year. DIVIDEND Due to loss, your Directors are unable to recommend payment of any dividend on Equity Shares for the year under review. EXPORT The Company's export turnover was Rs. 2093.41 lacs during the year under review, as compared to Rs. 2444.90 lacs in the previous year. DIRECTORS' RESPONSIBILITY STATEMENT The Audited Accounts for the year under review are in conformity with the requirements of the Act and the Accounting Standards. The financial statements reflect fairly the form and substance of transactions carried out during the year under review and reasonably present your Company's financial condition and results of operations. Your Directors confirm that: i) In the preparation of the annual accounts, the applicable accounting standards had been followed and no material departures have been made from the same, save and except as mentioned in the Auditor's Report. ii) They have adopted 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 or loss of the Company for that period; iii) 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, for preventing and detecting fraud and other irregularities; iv) The annual accounts have been prepared on a going concern basis. v) That there is adequate proper internal financial controls with reference to the financial statement have been laid down for the company and such internal financial controls are adequate and were operating effectively. vi) That proper systems have been devised to ensure compliance with the provisions of all applicable laws and such systems were adequate and operating effectively. AUDITORS' REPORT The comments made by the Auditors in their report and other relevant points in Annexure to their report are self-explanatory. The relevant notes to the accounts also clarify the points referred to by the Auditors. The Auditors have drawn attention of the members in qualified opinion of their report as under : 1. Point no. (a) regarding non-provision of long term and short term loans and advances, which has not been provided because your Company is hopeful of some recovery out of it and if necessary, in consultation with the Auditors, necessary provision will be made in coming years. 2. Point no. (b) regarding the claims receivable from Octroi Department in respect of the closed Nasik unit, your Company is hopeful of either receiving the claims or will be adjusting the claims with the dues of Octroi dept., if any, payable at the time of sale of the closed Nasik unit. 3. Point no. (c) is related party transaction and has not been written off. 4. Regarding Point no. (d) , your Company is negotiating with Industrial Development Bank of India for settlement of their dues which is under process. 5. Regarding Point no. (e), your Company has not made the provision of contingent liabilities since quantum of liability can not be ascertained pending settlement/disposal of appeals and the Company is hopeful of gertng favourable orders from the appellate authorities in respect of such appeals. TRANSFER TO INVESTORS' EDUCATION AND PROTECTION FUND In terms of sections 205A and 205C of the Companies Act, 1956 read with General Circular No. 22/2002 dated 23rd September, 2002 issued by the Department of Company Affairs, the Company could not deposit unclaimed and unpaid redemption amount of debentures and accrued interest thereon to Investors' Education and Protection Fund (presently section 125 of the Companies Act, 2013) and had filed necessary application with the BIFR seeking relief u/s 22(3) of SICA and also their approval to make the payment to public debenture holders as and when debentures certificates are surrendered to the Company. The BIFR has approved the same in terms of the Rehabilitation Scheme sanctioned by them vide order dated 10th June, 2010. The Company is making payment to the debenture holders under public category as and when the debenture certificates are surrendered with the company. REHABILITATION SCHEME As you are aware, the Rehabilitation Scheme of the Company, under the provisions of the Sick Industrial Companies (Special Provisions) Act, 1985, was sanctioned by Hon'ble Board of Industrial & Financial Reconstruction vide its order dated June 10, 2010. The Scheme envisaged comprehensive financial restructuring of the company which is still under implementation. The Company has also filed a modified Debt Rehabilitation Scheme (MDRS) in consultation with the secured lenders of the Company which is yet to be approved by BIFR. DEPOSITS The Company has not accepted any public deposit since its inception. CORPORATE GOVERNANCE REPORT Your Directors reaffirm their continued commitment to good corporate governance practices. During the year under review, your Company was in compliance with the provisions of Clause 49 of the Listing Agreement with the Stock Exchanges relating to corporate governance and as required by Clause 49 of the Listing Agreement, Management Discussion & Analysis and Corporate Governance Report are annexed as Annexure-I to the Directors' Report and forms part of this report. A certificate from the Auditors of the Company regarding compliance of the conditions of Corporate Governance as stipulated in the Clause 49 of the Listing Agreement is also attached to this report. CORPORATE SOCIAL RESPONSIBILITY (CSR) The Companies Act, 2013 stipulates expenditure of 2% of the average profit of past 3 years of CSR activities. The Act requires the Board to constitute a Corporate Social Responsibility Committee of the Board which has already been constituted. The company has formulated CSR Policy for promotion of education, healthcare and other activities which is uploaded on website of the company. The average net profit of last 3 financial years is below the stipulated limit i.e. Rs. 5 crores and hence the Company has not made any expenditure on CSR activities during the year. ESTABLISHMENT OF VIGIL MECHANISM / WHISTLE BLOWER POLICY The Company has established a vigil mechanism/whistle blower policy. The policy allows intimation by affected persons in good faith of concern or misconduct through a written communication. The Audit Committee oversees the vigil mechanism for disposal of the complaint. Direct access to the Chairman of the Audit Committee is also allowed in exceptional cases. The vigil mechanism/whistle blower policy is available on the Company's website (www.shalimarwires.com ) RISK MANAGEMENT The Company has laid down the procedures to inform to the Board about the risk assessment and minimization procedures, which shall be responsible for framing, implementing and monitoring the risk management plan of the company. DISCLOSURE OF PARTICULARS WITH REGARD TO CONSERVATION OF ENERGY ETC. Necessary information pursuant to sub-section (3) of section 134 of the Companies Act, 2013 read with Rule 8(3) of the Companies (Accounts) Rules, 2014 is presented in Annexure -II to this Report. ENVIRONMENT AND SAFETY The Company is conscious of clean environment and safe operations. It ensures safety of all concerned, compliance with environmental regulations and preservation of natural resources. As required by the Sexual Harassment of Women at Workplace (Prevention, Prohibition & Redressal) Act 2013, the Company has an internal policy on prevention of sexual harassment at workplace with a mechanism of lodging complaints. During the year under review, no complaints were reported to the Board. INSURANCE Adequate insurance cover has been taken for properties of the Company including buildings, plant and machineries and stocks against fire, earthquake and other risks as considered necessary. DIRECTORS In terms of the provisions of the companies Act, 2013 the Board appointed all the existing independent directors i.e. Mr Dipak Rudra, IAS ( Retd.), Mr Probir Roy and Mr Dipak Dasgupta, for a term of 5 years upto the conclusion of Annual General Meeting to be held in the year 2019. The shareholders at the Annual General Meeting held on 29th September, 2014 had approved their appointment. The independent directors have submitted the declaration of independence as required under Section 149 of the Companies Act, 2013 and the Board is of the opinion that they are independent within the meaning of the said requirement of the Act. As per provisions of Section 152 of the Companies Act, 2013, Mr. Sunil Khaitan (DIN 00385961) retire by rotation and being eligible offer himself for reappointment. The Board recommends his reappointment. The Board appointed Ms Sunanda Lahiri (DIN 00451473) as Additional Director on 7th February, 2015 who shall hold office up to the date of the ensuing Annual General Meeting. The company has received a notice as per the provisions of section 160(1) of the Companies Act, 2013 from a member proposing her appointment as a director. Based on her vast experience in banking sector, the Board recommended the appointment of Ms. Sunanda Lahiri as an Independent Director who shall hold office for five consecutive years until the conclusion of Annual General Meeting to be held in the year 2020. The resolution has been included in the Agenda of the ensuing Annual General Meeting. Approval of the members is sought for the said appointment. STATUTORY AUDITORS The auditors M/s. S.S. Kothari & Co., Chartered Accountants, Statutory Auditors of the company were reappointed as Auditors in the Annual General Meeting held on 29th September, 2014 for the period until the conclusion of the 21st Annual General Meeting of the Company at a remuneration to be fixed by the Board from time to time. Further, the said Auditors are eligible under Section 141(3) of the Companies Act, 2013 and their appointment is to be ratified by the members in the ensuing Annual General Meeting which we recommend. COST AUDITORS The Audit Committee in its meeting held on 27.5.2015 has recommended the reappointment of M/s. Mitra Bose & Associates, the Cost Auditor to conduct the cost audit of the company for the financial year 2015-16 in terms of section 148(3) of the Companies Act, 2013. Accordingly the Board appointed the said firm of Cost Accountants to carry out the cost audit for the year 2015-16 on the remuneration as recommended by the Board to be fixed by members in the ensuing Annual General Meeting of the Company INTERNAL AUDIT The Company has engaged M/s. Chaturvedi & Co., Chartered Accountants as its Internal Auditor and their scope of work and the plan for audit has been approved by the Audit Committee. The report submitted by them is regularly reviewed and their findings are discussed with the senior management and suitable corrective action taken on an ongoing basis to improve efficiency in operations. SECRETARIAL AUDIT Pursuant to the provisions of Section 204 of the Companies Act, 2013 and Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the company has appointed Messrs MR & Associates, Practicing Company Secretaries to undertake the Secretarial Audit of the company. The report of the Secretarial Audit is annexed herewith as Annexure - III. OTHER DISCLOSURES EXTRACT OF ANNUAL RETURN The details for the financial year ended 31st March, 2015 forming part of the extract of the annual return is enclosed as Annexure - IV. CHANGE IN SHARE CAPITAL During the year ended 31st March, 2015, there is no change in the issued and subscribed capital of your company. The outstanding equity share capital of the company as on 31st March, 2015 is 752.10 lacs comprising of 37605123 equity shares of Rs. 2/- each. NUMBER OF BOARD MEETINGS The Board of Directors met four times during the year ended 31st March, 2015. The details of the Board meetings and the attendance of Directors are provided in the Corporate Governance Report. COMPOSITION OF COMMITTEE OF DIRECTORS The Board has constituted the following Committees of Directors: (a) Audit Committee, (b) Nomination & Remuneration Committee. (c) Stakeholder Relationship Committee The detailed composition of above Committees is given in Corporate Governance Report. RELATED PARTY TRANSACTIONS All the related party transactions are entered on arm's length basis and are in compliance with the Companies Act, 2013 and the Listing Agreement. There are no materially significant related party transactions made by the Company with Promoters, Directors or Key Managerial Personnel etc, which may have potential conflict with the interest of the Company at large. All related party transactions are presented to the Audit Committee and the Board for its approval. The related party transactions policy as approved by the Board is uploaded as on Company's website "www.shalimarwires.com ". The details of the transactions with related party is given in the Annual Report. EVALUATION OF BOARD'S PERFORMANCE In compliance with the Companies Act, 2013 and Clause 49 of the Listing Agreement, the performance evaluation of the Board was carried out during the year under review. More details on the same is given in the Corporate Governance Report. BUSINESS RESPONSIBILITY REPORT (BR) In terms of new clause 55 of the Listing Agreement, listed entities shall submit as part of their Annual Reports, Business Responsibility Reports, describing the initiatives taken by them from an environmental, social and Governance perspective. Accordingly, BR Report on environment, human resources and principle wise performance form part of the management discussion and analysis report PARTICULARS OF EMPLOYEES The prescribed particulars of employees required under Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is attached as Annexure - V to this report. INDUSTRIAL RELATIONS The Company continued to have cordial relations with the employees at its plants located at Uttarpara and Paper Machine Wire unit at Nasik, Registered Office and Branch Offices and the Board records its appreciation for the useful contribution made by them. ACKNOWLEDGEMENT Your Directors place on record their deep appreciation for the support and cooperation extended by the lenders i.e. Financial Institutions and Banks, customers, suppliers, employees, investors and Government Authorities during the year. For and on behalf of the Board Sunil Khaitan Chairman & Managing Director The 10th August, 2015 Registered Office: 25, Ganesh Chandra AvenueKolkata - 700 013 |