DIRECTORS' REPORT Your Directors have pleasure in presenting the 20th Annual Report together with Audited Financial Statements of the Company for the period ended on 31st March, 2016. YEAR IN RETROSPECT The Company has achieved a total turnover of Rs. 36016.95 lacs (Previous year Rs. 31283.69 Lacs) including exports of Rs. 6783.40 lacs (Previous year Rs. 6157.47 Lacs) and Profit before Tax of Rs. 917.83 lacs (Previous year Rs. 876.56 Lacs) and Profit after Tax of Rs. 629.38 lacs. (Previous year Rs. 575.86 Lacs) During the year company has achieved quantum jump in refinery operations by expanding in new markets. Company continues its focus on export of value added products. It is expected that in the coming year company will maintain reasonable growth prospects in terms of volume and profitably. DIVIDEND During the Financial Year 2015-16, the Board of Directors of the company declared and paid interim dividend @12% (Rs. 0.12/-per equity shares of Rs. 1/- each on 50103520 Equity Shares) absorbing a sum of Rs. 60.12 Lacs (Previous year 10% on 50103520 Equity Shares of Rs. 1/- each aggregating to Rs. 50.10 lacs) and the same is considered as final dividend. DIRECTORS' RESPONSIBILITY STATEMENT To the best of their knowledge and belief and according to the information and explanations obtained by them, your Directors make the following statements in terms of Section 134(3)(c) of the Companies Act, 2013: 1. that in the preparation of the annual financial statements for the year ended 31st March, 2016, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any; 2. that the Directors have selected such accounting policies and applied them consistently and have made judgment 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 ended 31 March, 2016 and of the statement of profit and loss of the Company for that period; 3. that 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 and for preventing and detecting fraud and other irregularities; 4. that the annual financial statements have been prepared on a going concern basis; 5. that proper internal financial controls were in place and that the financial controls were adequate and were operating effectively. 6. that the Directors have devised proper systems to ensure compliance with the provisions of all applicable laws were in place and were adequate and operating effectively. CORPORATE GOVERNANCE The Company has complied with the mandatory provisions on Corporate Governance as prescribed in the Regulation 27 of SEBI (Listing obligations and Disclosure Requirements) Regulations, 2015 with the Stock Exchanges. A separate report on Corporate Governance as per schedule V{C} of SEBI (Listing obligations and Disclosure Requirements) Regulations, 2015 is included as a part of the Annual Report along with the Practicing Company Secretary Certificate on its compliance. RELATED PARTY TRANSACTIONS: All related party transactions that were entered into during the financial year were on an arm's length basis and were in the ordinary course of business. There are no materially significant related party transactions made by the Company with Promoters, Directors, Key Managerial Personnel or other designated persons which may have a potential conflict with the interest of the Company at large. All Related Party Transactions are placed before the Audit Committee as also the Board for approval. Separate disclosure as per regulation 34(3) and 53 (f) of SEBI (Listing obligations and Disclosure Requirements) Regulations, 2015 is made in the report. CORPORATE SOCIAL RESPONSIBILITY In CSR account company was to incurred Rs. 10.91 Lacs in the Financial Year 2015-16 and the outstanding amount for the financial year 2014-15 is Rs. 8.98 Lacs. The CSR Committee had identified some projects and expenses will be incurred in the current year The Annual Report on CSR details is annexed hereto as Annexure C and forms a part of this Report. RISK MANAGEMENT AND ADEQUACY OF INTERNAL FINANCIAL CONTROLS The Company's system of financial and compliance controls with reference to the financial statements and risk management is embedded in the business process by which the Company pursues its objectives. Management is responsible for establishing and maintaining adequate disclosure controls and procedures and adequate internal controls over financial reporting with respect to financial statements besides its effectiveness in the context of applicable regulations. The Internal Auditor, the Audit Committee as well as the Board of Directors conduct from time to time an evaluation of the adequacy and effectiveness of the system of internal controls for financial reporting with respect to financial statements. DIRECTORS In terms of Section 197,198 read with schedule V and other applicable provisions, if any of the Companies Act, 2013, Shri Shiv Singh Mehta (DIN 00023523), Managing Director of the company was reappointment for the further period of 3 years commencing from 12thJanuary, 2016 to 11th January, 2019 without any remuneration. In terms of Section 197,198 read with schedule V and other applicable provisions, if any of the Companies Act, 2013, Shri Saurabh Singh Mehta (DIN 00023591), Executive Director of the company was reappointment for the further period of 3 years commencing from 1st August, 2016to 31stJuly, 2019 with remuneration. In terms of Section(s) 149, 152 and all other applicable provisions of the Companies Act, 2013, for the purpose of determining the directors liable to retire by rotation, the Independent Directors are not included in the total number of directors of the Company. Accordingly, Shri Saurabh Singh Mehta (DIN 00023591) shall retire by rotation at the ensuing Annual General Meeting and being eligible, has offered himself for re-appointment as a Director of the Company. Pursuant to provisions of Companies Act, 2013 Shri Somnath Ghosh, Independent Director of the company whose terms was expired on 31st March, 2016 and he has not offered himself for the re- appointment of next term. The Board appreciated for the valuable contribution of Dr. Somnath ghosh as Independent director of the company throughout his director ship for the valuable advice he made from time to time to the management DECLARATION BY INDEPENDENT DIRECTORS Necessary declarations have been obtained from all the Independent Directors under sub-section (7) of Section 149 of the Companies Act, 2013. KEY MANAGERIAL PERSONNEL Shri Sumit Jaitely, Company Secretary of the Company resigned w.e.f 10.09.2015 and in place of him Smt. Alheena Khan was appointed as Company Secretary w.e.f 07.09.2015 MEETINGS During the financial year five Board Meetings and four Audit Committee Meetings were convened and held. The details of which are given in the Corporate Governance Report. The intervening gap between the Meetings was within the period prescribed under the Companies Act, 2013 and SEBI (Listing obligations and Disclosure Requirements) Regulation, 2015. PERFORMANCE EVALUATION OF BOARD, COMMITTEES & DIRECTORS Pursuant to the Provisions of the Companies Act, 2013 and as stipulated under Chapter IV (17) (10) SEBI (Listing obligations and Disclosure Requirements) Regulation, 2015, the Board of Directors adopted a formal mechanism for evaluating its performance and as well as that of its Committees and individual Directors. A structured evaluation process covering various aspects of the Boards functioning such as Composition of the Board & committees, experience & competencies, performance of specific duties & obligations, governance issues etc. The evaluation of the Independent Directors was carried out by the entire Board and that of the Managing Director, Whole Time Director and the Non Independent Directors were carried out by the Independent Directors. The Directors were satisfied with the evaluation results, which reflected overall engagement of the Board and its Committees with the company. AUDITORS AND AUDITOR REPORT Pursuant to the provisions of Section 139(2) and other applicable provisions of the Companies Act, 2013 and the Rules made there under, M/s R. S. Bansal and Company, Chartered Accountants (FRN 000939C) the retiring auditor is re-appointed as Auditors of the Company for the further term of five years from 1st April, 2016 to 31st March, 2021 and to hold the office until the conclusion of 25th Annual General Meeting of the company to be held in year 2021 subject to ratification of the re- appointment by members in each Annual general Meeting on such remuneration as may be fixed by the Board." The notes on Financial Statements referred to in the Auditors Report are self explanatory and do not call for any further comments. COST AUDITOR Pursuant to Section 148 of the Companies Act, 2013 read with the Companies (Audit and Auditors) Rules, 2014 your Directors had, on the recommendation of the Audit Committee, appointed Shri S.P.S. Dangi, proprietor of M/s S.P.S Dangi, Cost Auditor (FRN 100004) to audit the cost accounts of the Company for the financial year ending 31.03.2017 Resolution seeking Member's ratification for the remuneration payable to Shri S.P.S. Dangi, proprietor of M/s S.P.S Dangi, Cost Auditor (FRN 100004) is included at Item No. 5 of the Notice convening the Annual General Meeting. The company is in process to file the Cost Audit Report to the Central Government within the stipulated time. SECRETARIAL AUDITOR Pursuant to the provisions of Section 204 of the Companies Act, 2013 and The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed M/s Ashish Karodia & Company, a Company Secretary in Practice to undertake the Secretarial Audit of the Company. The Report of the Secretarial Audit Report is annexed herewith. STATUTORY INFORMATION PUBLIC DEPOSIT The company has not received/accepted any deposits from public during the year under review within the meaning of section 73 of the Companies Act, 2013, and the Companies (Acceptance of Deposits) Rules, 2014 and there is no overdue unpaid/unclaimed deposit as at 31st March, 2016. PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURE Disclosures pertaining to remuneration and other details as required under Section 197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is annexed hereto and forms part of this report. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS&OUTGO Information as per section 134(3)(m) read with Rule 8 of the Companies (Accounts) Rules, 2014 is annexed hereto and forms part of this report. EXTRACT OF ANNUAL RETURN: The extract of Annual Return in Form No.MGT-9 as required under Section 92 of the Companies Act, 2013 for the financial year ending March 31st, 2016 is annexed hereto as Annexure D and forms part of this report. VIGIL MECHANISM /WHISTLE BLOWER POLICY The Company has a Vigil Mechanism/Whistle Blower Policy to deal with instance of fraud and mis management, if any. The details of the Policy is explained in the Corporate Governance Report and also posted on the website of the Company. GENERAL Your Directors state that no disclosure or reporting is required in respect of the following items as there were no transactions on these items during the year under review: • Issue of equity shares with differential rights as to dividend, voting or otherwise. • Issue of shares (including sweat equity shares) to employees of the Company under any scheme. • Neither the Managing Director nor the Whole-time Directors of the Company receive any remuneration or commission from its subsidiary. • No significant or material orders were passed by the Regulators or Courts or Tribunals which impact the going concern status and Company's operations in future. • During the year under review, there were no cases filed or reported pursuant to the Sexual Harassment of Women at Workplace(Prevention, Prohibition and Redressal) Act, 2013. ACKNOWLEDGMENT The Board desires to place on record its grateful appreciation for the excellent assistance and co-operation received and continued support extended to the Company by the bankers, investors, suppliers and esteemed customers and other business associates. Your Directors also wish to place on record their deep sense of appreciation to all the employees of the Company for their commitment and continued contribution in the performance of the company. By order of the Board Kriti Nutrients Limited CIN L24132MP1996PLC011245 Shiv Singh Mehta Managing Director DIN 00023523 Regd. Office: Mehta Chamber, 34 Siyaganj, Indore Place: Indore Date:11 August,2016 |