DIRECTORS' REPORT To, The Members Avon Mercantile Limited ThehBoard of Directors of your Company have pleasure in placing before the Members the 30 Annual Report together with the Audited Statement of Accounts of the company for the year ended on 31 March 2015. TRANSFER TO RESERVES The Company proposes not to transfer any amount of profit to the reserves. DIVIDEND The Board of Directors of the Company has not recommended any dividend for the Financial Year ending 31 March 2015. DEPOSITS Your Company has not accepted any public deposit and, as such, no amount on account of principal or interest on public deposits was outstanding as at 31 March 2015 under review within the meaning of Section 73 of the Companies Act, 2013, read with the Companies (Acceptance of Deposits) Rules, 2014. DIRECTORS Pursuant to Sections 149(1) and 161 of the Companies Act, 2013 (the "Act") read with Rule 8(5) of the Companies (Accounts) Rules, 2014 and provisions of the Clause 49 (II) of the Listing Agreement, the following details relating to Directors are reported: The Board of your Company is duly constituted with proper balance of Executive Directors, Non-Executive Directors (including Woman Director) and Independent Directors. i) RE-APPOINTMENT OF RETIRING DIRECTOR Mr. Rakesh Kumar Bhatnagar (DIN: 02922258) is liable to retire by rotation and, being eligible, offers himself for re-appointment. The Directors recommend Mr. Rakesh Kumar Bhatnagar for re-appointment. ii) INDEPENDENT DIRECTORS The members in the last Annual General Meeting of the Company held on 30th September 2014 had approved the appointments of Mr. Ramesh Chandra Agarwal (DIN: 00037477) and Mr. Satish Kumar Gupta (DIN: 00030841) as Independent Directors to hold office for 5 consecutive years w.e.f. 30 September 2014, who are not liable to retire by rotation. Pursuant to Section 134(3)(d) read with Section 149(7) of the Companies Act, 2013, both the Independent Directors have given declarations for the Financial Year 201516 that they meet the criteria of independence as laid down under Section 149(6) the Act and Clause 49 of the Listing Agreement. The Company has a policy to induct its Independent Directors upon their appointment to attend the orientation programme conducted by the Company so as to familiarize them with the Company's policies, strategies, plans, etc. Further the Board advises and ensures that its Independent Directors attend programmes / seminars conducted by various organizations on the matters relating to finance, taxation, corporate governance, etc. so that they keep themselves updated with the various developments in the corporate/ legal world. iii) WOMAN DIRECTOR Pursuant to the provisions of Sections 149, 152, 161(1), 184 and any other applicable provisions of the Companies Act, 2013 and rules made there under, Ms. Gunjan Arora, who was appointed as an Additional Director of the Company w.e.f. 25 March 2015 and who holds office up to the date of this Annual General Meeting and in respect of whom the Company has received a notice in writing from a member proposing her candidature for the office of the Director of the Company, be and is hereby elected and appointed as Non-Executive Director, whose period of office shall be liable to determination by retirement of directors by rotation. The brief resume and details of Directors who are to be appointed / re-appointed are furnished in the Notice for the Annual General Meeting as ANNEXURE - B. As required under the provisions of Section 134(q) read with Rule 8(5)(iii) of the Companies (Accounts) Rules, 2014, the details of Directors or Key Managerial Personnel who were appointed or have resigned during the year under review are as follows: AUDIT COMMITTEE The details pertaining to composition of Audit Committee are included in the Corporate Governance Report, which forms part of this report. There are no instances of the Board not accepting the recommendations of the Audit Committee during the Financial Year 2014-15. NOMINATION AND REMUNERATION COMMITTEE The details pertaining to composition of Nomination and Remuneration Committee and the Company's policy on Directors, Key Managerial Personnel and other Employees' appointment and remuneration and other matters provided in Section 178(3) and (4) of the Act have been disclosed in the Corporate Governance Report, which forms part of this report. STAKEHOLDERS RELATIONSHIP COMMITTEE The details pertaining to composition of Stakeholders Relationship Committee are included i n the Corporate Governance Report, which forms part of this report. CORPORATE SOCIAL RESPONSIBILITY The provisions contained in Section 135 of the Companies Act, 2013 read with the Companies (Corporate Social Responsibility) Rules, 2014 are not applicable to the Company. BOARD EVALUATION Pursuant to Section 134(q) of the Companies Act, 2013, read with Rule 8(4) of the Companies (Accounts) Rules, 2014 and Clause 49 of the Listing Agreement, the Board has carried out a formal annual evaluation of its own performance, performance of the Directors as well as the evaluation of the working of its Committees. The Nomination and Remuneration Committee has in terms of Section 178(2) and (3) of the Companies Act, 2013, defined the evaluation criteria, procedure and time schedule for the Performance Evaluation process for the Board, its Committees and Directors. The nomination and remuneration policy, inter alia, giving details about the policy on directors' appointment and remuneration including the criteria for determining qualifications, positive attributes, independence and other details are included in nomination and remuneration policy, the details of which are given in the Corporate Governance Report, which forms part of this Report. NUMBER OF MEETINGS OF THE BOARD A total of 7 (seven) Board Meetings were held during the Financial Year 2014-15, the details of which are given in the Corporate Governance Report, which forms part of this Report. SECRETARIAL AUDIT REPORT Pursuant to the provisions of Section 204 of the Companies Act, 2013, read with Rule 9 of the Companies (Appointment and Remuneration) Rules, 2014, the Board had appointed M/s S.K Batra & Associates, Company Secretaries in Practice (C.P No 8072) to undertake the Secretarial Audit of the Company for the financial year 2014-15 and the report is annexed as ANNEXURE-I to this report. EXTRACT OF ANNUAL RETURN AS PROVIDED UNDER SECTION 92(3) OF THE ACT The extract of annual return is given in ANNEXURE- II in the prescribed Form MGT-9, which forms part of this report. TRANSACTIONS WITH RELATED PARTIES None of the transactions with related parties falls under the scope of Section 188(1) of the Act. Information on transactions with related parties pursuant to Section 134(3)(h) of the Act read with Rule 8(2) of the Companies (Accounts) Rules, 2014 are given in ANNEXURE-III in Form AOC-2 and the same forms part of this report. PARTICULARS OF EMPLOYEES In terms of Section 197(12) read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, table containing the names and other particulars of employees is appended in ANNEXURE - IV. Further, in terms of Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, no employee employed throughout the financial year is in receipt of remuneration of Rs. 60 lakh or more, or employed for part of the year and is in receipt of Rs. 5 lakh or more a month, employed throughout the financial year or part thereof and is in receipt of remuneration in excess of that drawn by the managing director or whole-time director or manager and holds by himself or along with his spouse and dependent children, not less than two percent of the equity shares of the company. CORPORATE GOVERNANCE & COMPLIANCE CERTIFICATE The Company is committed to follow the standards of good Corporate Governance. As required under Clause 49 of the Listing Agreement, a detailed report on Corporate Governance as well as the Certificate from M/s K Rakesh & Co., Company Secretaries in Practice (C.P. No. 14700), confirming compliance of the conditions of Corporate Governance are annexed as ANNEXURE-V(a) and ANNEXURE-V(b) respectively and form integral part of this report. MANAGEMENT DISCUSSION AND ANALYSIS REPORT As required under Clause 49 of the Listing Agreement, the Management Discussion and Analysis Report is presented in the separate section and is marked as ANNEXURE - VI and forms an integral part of this report. RISK MANAGEMENT POLICY OF THE COMAPNY The Board of Directors have adopted risk management policy for the Company which provides for identification, assessment and control of risks which in the opinion of the Board may threaten the existence of the Company. The Management identifies and controls risks through a properly defined framework in terms of the aforesaid policy. DIRECTORS' RESPONSIBILITY STATEMENT Pursuant to requirement under section 134(3) 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 Financial Year 2014-15, 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 31st March 2015 and of the profit and loss 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 this Act 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. VIGIL MECHANISM/ WHISTLE BLOWER POLICY Pursuant to Section 177(9) and (10) of the Companies Act, 2013, read with Rule 7 of the Companies (Meetings of Board and its powers), Rules 2014 and Clause 49 of the Listing Agreement, the Company has established a Vigil Mechanism to report genuine concerns about actual or suspected frauds, unethical behavior etc. and the same has been posted on the official website of the Company. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS During the Financial Year 2014-15, no significant order has been passed by any regulator court. MATERIAL CHANGES No material changes took place from the date of end of financial year till the date of this report. AUDITORS M/s Gupta Garg & Agarwal, Chartered Accountants, Auditors of the Company retire at the conclusion of the ensuing Annual General Meeting and being eligible, offer themselves for re-appointment. AUDITORS' REPORT The Auditors' Report does not contain any qualifications, reservations or adverse remarks. The observations made in the Auditors' Report and Notes on Accounts are self-explanatory. PARTICULARS OF LOANS, GUARANTEES AND INVESTMENTS The particulars of loans, guarantees and investments have been disclosed in the financial statements. MATERIAL CHANGES AFFECTING THE FINANCIAL POSITION OF THE BUSINESS There being no material change in the financial position of the business which would affect the company. CASH FLOW STATEMENT In conformity with the provisions of Clause 32 of the Listing Agreement, the Cash Flow Statement for the year ended on 31st March 2015 is attached as a part of the Annual Accounts of the Company. INTERNAL CONTROL SYSTEMS The Company has in place adequate systems of Internal Control to ensure compliance with policies and procedures. The Board has appointed M/s RBAS & Associates, Chartered Accountants, as Internal Auditor of the Company for the Financial Year 2014-15. The Internal Audit Reports along with observations and recommendations contained therein are constantly reviewed and implemented by the Audit Committee of the Board. SUBSIDIARIES During the year under review, the Company does not have any subsidiary. LISTING AT STOCK EXCHANGE(s) The Company continues to be listed at the Calcutta Stock Exchange Association Ltd. and Bombay Stock Exchange Ltd. ACKNOWLEDGEMENT Your Directors wish to place on record their sincere thanks and appreciation for the cooperation and help provided by State Government and the Bankers to the Company. Your Directors also acknowledge the continued trust and confidence that Shareholders have placed in the Company. By Order of the Board For AVON MERCANTILE LIMITED (Rakesh Kumar Bhatnagar) Director DIN:02922258 (Vikas Kapoor) Director DIN:03020854 Place : Noida Date : 14th August 2015 |