DIRECTORS' REPORT TO THE MEMBERS : Your Directors present their Twenty -third Annual Report together with audited financial statements of the Company for the year ended on 31st March, 2015 Share capital The paid up equity share capital as on 31 March 2015 was 4.12 Crore There was no public issue, rights issue, bonus issue or preferential issue etc. during the year. The Company has not issued shares with differential voting rights, sweat equity shares nor has it granted any stock options. Operations Detailed information on the operations of the Company are covered in the Management Discussion and Analysis Report. Extract of Annual Return The extract of the Annual Return of the Company in Form MGT-9 is annexed herewith as Annexure "A" to this report. NUMBER OF MEETINGS OF THE BOARD During the Financial Year 2014-15, 10(Ten) Board Meetings were held. The details of which are given in Corporate Governance Report. Directors' Responsibility Statement Pursuant to the requirements under Section 134(5)of the Companies Act, 2013 with respect to Directors' Responsibility Statement, it is hereby confirmed that: a) In the preparation of the annual accounts for the year ended March 31, 2015, the applicable Accounting Standards have been followed and there were no 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 March 31,2015 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 accounts 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. Nomination And Remuneration Policy The Board has, on the recommendation of the Nomination and Remuneration Committee, framed a policy for selection and appointment of Directors, Key Managerial Personnel and Senior Management Personnel and their remuneration. The Nomination and Remuneration policy is annexed herewith as Annexure "B" to this report. Particulars of Loans And Guarantees And Investments: Particulars of loans, Guarantees and Investments covered under of Section 186 of the Companies Act, 2013, are given in the notes to the financial statements provided in this Annual Report. PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES All contracts or arrangements entered into by the Company with Related Parties have been done at arm's length and are in the ordinary course of business. The policy on Related Party Transaction as approved by the Board has been displayed on the Company's website. Pursuant to Section 134 of the Companies Act, 2013 read with Rule 8(2) of the Companies (Accounts) Rules, 2014, the particulars of such transactions are provided in Form AOC-2 which is annexed herewith as Annexure "C" to this report. Related Party disclosures as per AS-18 have been provided in Note-28 to the financial statement. Dividend Due to decrease in the cash accruals, there is an increased pressure on the cash flows in the financial year under review. The Board of Directors feels appropriate not to recommend any dividend for the financial year 2014-15. State of Company's Affairs Discussion on state of Company's affairs has been covered as part of the Management Discussion and Analysis (MDA). MDA 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 the Annual Report. Conservation of Energy, Technology Absorption And Foreign Exchange Earnings And Outgo The particulars relating to conservation of energy, technology absorption, foreign exchange earnings and outgo, as required to be disclosed under Section 134(3)(m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014 are annexed herewith as Annexure "D" to this report. RISK MANAGEMENT POLICY The Company has a robust risk management framework comprising risk governance structure and defined risk management processes. The risk governance structure of the Company is a formal organization structure with defined roles and responsibilities for risk management. The processes and practices of risk management of the Company encompass risk identification, classification and evaluation. The Company identifies all strategic, operational and financial risks that the Company faces, by assessing and analyzing the latest trends in risk information available internally and externally and using the same to plan for risk management activities. The Company has set-up a Finance and Risk Management Committee to review the risks faced by the Company and monitor the development and deployment of risk mitigation action plans. The Committee reports to the Board of Directors and the Audit Committee who provide oversight for the entire risk management framework in the Company. Accordingly, this year as well, the Directors have reviewed the risk management policy and processes and also the risks faced by the Company and the corresponding risk mitigation plans deployed. The Company is on track in respect of its risk mitigation activities. AUDIT COMMITTEE The Audit Committee comprises of Mr. Dinesh Kaushal (Chairman), Mr. K.G.Gupta, Mr. and Mr. Ankur Garg. All the recommendations made by the Audit Committee were deliberated and accepted by the Board. BOARD EVALUTION The Board of Directors evaluated the annual performance of the Board as a whole, its Committees and the Directors individually in accordance with the provisions of the Companies Act,2013 and Clause 49 of the Listing Agreement in the following manner :- I. Structured evaluation forms, as recommended by the Nomination and Remuneration Committee, after taking into consideration inputs received from the Directors, covering various aspects of the Board's functioning such as adequacy of the composition of the Board and its Committees, Board culture, execution and performance of specific duties, obligations and governance, for evaluation of the performance of the Board, its Committees and each Director were provided to all the members of the Board. II. The members of the Board were requested to evaluate by filling the evaluation forms and the duly filled in evaluation forms were required to be sent to the Company Secretary in a sealed envelope or personally submitted to the Chairman at the concerned meeting. III. Based on the individual evaluation of the Directors, the Board initiated a detailed discussion at the concerned meeting on the performance of the Board /Committee/Individual Director and formulated a final collective evaluation of the Board. The Board also provided an individual feedback to the concerned Director on areas of improvement if any. A separate meeting of Independent Directors was held on 31st December, 2014 to evaluate the performance evaluation of the Chairman of the meeting of Board of Directors (as there is no Chairman of the Board), The Non Independent Directors, the board and flow of information from management. DETAILS OF APPOINTMENT AND RESIGNATION OF DIRECTORS In terms of provisions of the Companies Act, 2013 and the Articles of Association of the Company, Mr. Virendra Kumar Gupta (DIN: 00006464) and Mr. Ashok Kumar Agarwal (DIN: 000065412), Directors of the Company, retire by rotation at the ensuing Annual General Meeting and being eligible have offered themselves for re-appointment. On the recommendation of the Nomination and Remuneration Committee, the Board appointed Mr. K. G. Gupta who was appointed as Additional Director from November 13, 2014, Mr. Hakikat Singh , as Independent Non-executive Director of the company up to September 11, 2014 when he ceased to be the Director of the Company due to his death . The Company has received declarations from all the Independent Directors of the Company confirming that they meet the criteria of independence as prescribed both under sub section (6) of Section 149 of the Companies Act, 2013 and under Clause 49 of the Listing Agreement with the Stock Exchanges. DEPOSITS The Company has not accepted deposits under Chapter V of the Companies Act, 2013 during the year. Internal Financial Control System The company has comprehensive and adequate internal financial controls system for all major processes including financial statement to ensure reliability of reporting. The system also helps management to have timely data/feedback on various operational parameters for effective review. It also ensure proper safeguarding of assets across the company and its economical use. The internal financial controls system of the company is commensurate with the size, scale and complexity of its operations. The systems and controls are periodically reviewed and modification based on the requirement. The company has an internal audit function, which is empowered to examine the adequacy and compliance with policies, plans, statutory requirements. It is also responsible for assessing and improving the effectiveness of risk management, control and governance process. The scope of internal Audit is well defined and documented and the audit committee reviews the observations of the Internal Audit critically. The composition and working of the audit committee forms part of the Corporate Governance Report. INFORMATION ON REMUNERATION Information as per the provisions of Section 197(12) of the Companies Act,2013 read with Rule 5(1),5(2) and 5(3) of the Companies ( Appointment and Remuneration of Managerial Personal) Rules,2014 are annexed as Annexure-E to this report. VIGIL MECHANISM The Company has in place Whistle Blower Policy, wherein the Employees/Directors/Stakeholders of the Company are free to report any unethical or improper activity, actual or suspected fraud or violation of the Company's Code of Conduct. 1 . This mechanism provides safeguards against victimization of Employees, who report under the said mechanism. During the year under review, the Company has detected one transaction of fraud being carried by Mr. Gulab Singh, Manager HR & Administrator, who by his fraudulent act has cheated the company by sum of Rs. 32,97,254-. The company has also taken appropriate action against him and FIR in this respect has also been made with jurisdiction police station. The Whistle Blower Policy of the Company has been displayed on the Company's website www.cenlub. AUDITORS a) Statutory Auditors At the Twenty- Second Annual General Meeting of the company held on 27th September,2014, M/s.Satish Singla & Co.,Chartered Accountants (Firm Registration No.000882N)have been re-appointed as the Statuary Auditors of the company to hold office (subject to ratification by shareholders at every Annual General Meeting). The Company has received consent from M/s.Satish Singla & Co.,Chartered Accountants, Auditors of the Company and confirmation regarding their eligibility to continue as Statuary Auditors of the Company . Your Directors request you to ratify the appointment of M/s.Satish Singla & Co.,Chartered Accountants (Firm Registration No.000882N) as Statutory Auditors of the Company at the ensuing Twenty-third Annual General Meeting and to fix their remuneration. The report by Auditors is self -explanatory. b) Cost Auditors The Company was not required to appoint Cost Auditors for the financial year 2014-15 under the provisions of Section 148 of the Companies Act,2013 and rules made there under. c) Secretarial Audit M/s. Shreyansh Jain & Associates, Company Secretaries, were appointed as Secretarial Auditors of the Company for the financial year 2014-15 pursuant to Section 204 of the Companies Act, 2013. The Secretarial Audit Report submitted by them in the prescribed form MR- 3 is attached as 'Annexure and forms part of this report. There are no qualifications or observations or other remarks of the Secretarial Auditors in the Report issued by them for the financial year 2014-15 which call for any explanation from the Board of Directors. SUBSIDIARIES A separate statement containing the salient features of financial statements of subsidiaries of your Company forms part of consolidated financial statements in compliance with Section 129 and other applicable provisions, if any, of the Companies Act, 2013. The financial statements of the subsidiary companies and related information are available for inspection by the members at the Registered Office of your Company during business hours on all days except Saturdays, Sundays and public holidays up to the date of the Annual General Meeting (AGM) as required under Section 136 of the Companies Act, 2013. Any member desirous of obtaining a copy of the said financial statements may write to the Company Secretary at the Registered Office of your Company. The financial statements including the consolidated financial statements, financial statements of subsidiaries and all other documents required to be attached to this report. The financial performance of each of the subsidiaries in the consolidated financial statements of your Company is set out in the Report. Additional details of the performance and operations of the subsidiaries along with details of the acquisitions and investments made by your Company and its subsidiaries during the financial year in the Management Discussion and Analysis which also forms part of this Report. DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013 The Company has in place a policy for prevention of Sexual Harassment In accordance with the requirements of the Sexual Harassment of Women at Workplace (Prevention, Prohibition & Redressal) Act, 2013. Internal Complaints Committee has been set up to redress complaints received regarding Sexual Harassment .All employees (permanent, contractual, temporary, trainees) are covered under this policy. The Company did not receive any complaint during the year 2014-15. ACKNOWLEDGEMENT Your Directors acknowledge and thank the Company's customers, shareholders, vendors ,state government authorities, business associates , banks and financial institutions for the support extended to the Company. Your Directors also record their appreciation for the commitment and dedication of the employees of your Company. For and on Behalf of the Board of Directors V.K.Gupta Director DIN 00006461 V.K.Mittal Managing Director DIN 00006398 Date : 13th August 2015 Place : Faridabad |