BOARD REPORT To, The Members, Dhampur Sugar Mills Limited The directors have pleasure in presenting their Annual Report of the Company together with the Audited Accounts for the year ended 31st March, 2015. Subsidiaries, Joint Ventures and/or Associate Companies A Statement containing salient features of the financial statement of Dhampur International Pte Limited and Dhampur Global Pte Limited, subsidiaries of the Company is annexed as Annexure 1 and forms an integral part of this report. Material Changes and Commitments during the Year There are no material changes and commitments affecting the financial position of the Company which have occurred between the end of the financial year of the Company to which the financial statements relate and the date of the report during the year under review, as required under Section 134(3)(l) of the Companies Act, 2013. Change in the Nature of Business During the year, there was no material change in nature of business of the Company. Dividend In absence of profits, your directors do not recommend any dividend for the year ending 31st March 2015. Reserves & Surplus The Company has incurred a Loss of Rs. 10.36 Crore which has been adjusted in Profit and Loss Account under the head Reserves & Surplus. Equity Share Capital The Company had issued 30,00,000 equity warrants, each having an option to convert into equity shares of C10 each at a premium of C 23 each, during the previous year. Holder of 15,00,000 equity warrants has exercised this conversion option during the year and consequently, the equity shares were allotted. Directors The Board of Directors in their meeting held on 12th November, 2014 appointed Smt. Nandita Chaturvedi as Additional Director and Non-Executive Independent Director of the Company w.e.f 12th November, 2014 for a period of five consecutive years for a term upto 11th November, 2019. The above appointment was based on the recommendation of the Nomination and Remuneration Committee and subject to the approval of the Shareholders of the Company at the forthcoming Annual General Meeting. Smt. Nandita Chaturvedi holds office upto the date of the forthcoming Annual General Meeting and is eligible for appointment. Details of the proposal for her appointment has been provided in the Notice of the 80th Annual General Meeting of the Company containing explanatory statement. Shri V.K Goel and Shri A.K Goel will retire at the ensuing Annual General Meeting and being eligible have offered themselves for their re-appointment. It has been proposed to change the Remuneration and terms of appointment of Shri V.K Goel, Chairman, Shri A.K Goel, Vice Chairman, Shri Gaurav Goel and Shri Gautam Goel, Managing Directors subject to approval of shareholders in the ensuing annual general meeting of the Company. Brief profile of Shri V.K Goel, Shri A.K Goel, Shri Gaurav Goel, Shri Gautam Goel and Smt. Nandita Chaturvedi, has been given in the Corporate Governance, forming part of the Annual Report. Key Managerial Personnel Pursuant to the provisions of Section 203 of Companies Act, 2013 and rules made thereunder, Shri Arhant Jain, Executive President Finance & Company Secretary has been designated as Chief Financial Officer and Company Secretary of the Company. Deposits 1. Accepted during the year : Rs.9.27 crores 2. Remained unpaid or unclaimed as at the end of the year Rs. 0.31 Crores 3. If there has been any default in repayment of deposits or payment of interest thereon during the year and if so, number of such cases and the total amount involved: a. At the beginning of the year; N.A b. Maximum during the year;N.A c. At the end of the year.N.A Deposits not in compliance with Chapter V of the Act The Company has not accepted any deposit , which is not in compliance with chapter V of the Act. Particulars of Loans, Guarantees or Investment Details of Loans, Guarantees and Investments covered under the provisions of section 186 of the Companies Act, 2013 are given in the notes to Financial statements. Related Party Transactions All the transactions done with Related parties for the year under review were on arm's length basis and are in compliance with the applicable provisions of the Act and Listing Agreement. There are no material 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. The Related Party Transactions Policy as approved by the Board is uploaded on the Company's website at <http://www.dhampur.com> Your directors draw attention of the members to Note 31 to the Financial Statement which sets out related party disclosures. Auditors and Auditors' Report M/s Mittal Gupta & Co., Chartered Accountants, Kanpur, the auditors of your Company will retire at the ensuing Annual General Meeting and being eligible are proposed to be re-appointed. M/s S Vaish & Co., Chartered Accountants, Kanpur, joint Statutory Auditors of the Company have expressed that they shall not like to continue as Statutory Auditors. The observations of the Auditors in their report read with the accounts are self-explanatory except emphasis on subsidy announced by government of Uttar Pradesh. We submit that the government of Uttar Pradesh has announced subsidy scheme in order to extend financial support to the sugar industries enabling them to make cane payments. The Company has estimated the subsidy amount of C 12261.33 lacs based on the average selling price of Sugar and By-products which is significantly lower than the threshold specified in the Press note dated 12.11.2014. The Company is confident that the announced subsidy will be notified by the government. Secretarial Auditors and Secretarial Audit Report Pursuant to the provisions of Section 204 of Companies Act, 2013 and rules made there under, the Company has appointed GSK & Associates , a firm of Company Secretaries in Practice , to undertake the Secretarial Audit of the Company. The Secretarial Audit Report is annexed as Annexure 2 and forms an integral part of this report. There is no secretarial audit qualification for the year under review. Corporate Governance In compliance with Clause 49 of the Listing Agreement with the Stock Exchanges, a detailed Corporate Governance Report has been given elsewhere in this report, along with the Management Discussion and Analysis Report, which form an integral part of the Annual Report. A certificate from GSK & Associates, a Firm of Company Secretaries, confirming compliance with the conditions of Corporate Governance as stipulated under Clause 49 of the Listing Agreement is attached to this report. Directors Responsibility Statement: In accordance with the provisions of Section 134(5) of the Companies Act, 2013 your directors state that: (a) in the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures; (b) the directors have 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 at the end of the financial year and of the profit and loss of the Company for that period; (c) the directors have 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 have prepared the annual accounts on a going concern basis; (e) the Company has an effective internal control and risk mitigation system, which are constantly assessed and strengthened with the new/revised standard operating procedures. (f) the directors, have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively. Declaration by Independent Directors The Company has received declaration from all Independent Directors in accordance with the provisions of Section 149(6) of the act, whose names are as under: 1. Shri M. P. Mehrotra 2. Shri Priya Brat 3. Shri Ashwani K Gupta 4. Shri Harish Saluja 5. Shri Rahul Bedi 6. Smt. Nandita Chaturvedi Audit Committee Details of the composition of the Audit Committee and the attendance at the meetings held during the financial year 2014-15 forms part of the Corporate Governance Report. Nomination and Remuneration Policy The Board of Directors have framed a policy which lays down a framework in relation to remuneration of Directors, Key Managerial Personnel and Senior Management of the Company. The details of this policy is explained in the Corporate Governance Part of this report. The remuneration policy is in consonance with the existing policy of the Company. Risk Management Policy The Company has Risk Management Committee of Directors to have a system of Risk Management , inter alia, to review it periodically. Vigil Mechanism/Whistle Blower Policy The Company has formulated Vigil Mechanism /Whistle Blower Policy for employees and Directors to keep high standards of ethical behavior and provide safeguards to whistle blower. Disclosure under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. The Company has in place an Anti Sexual Harassment Policy in line with the requirements of The Sexual Harassment of Women at the Workplace (Prevention, Prohibition and Redressal) Act, 2013. Internal Complaints Committee (ICC) has been set up to redress complaints received regarding sexual harassment. All employees (permanent, contractual, temporary, trainees) are covered under this policy. The following is a summary of sexual harassment complaints received and disposed off during the year 2014-15. No. of complaints received Nil No. of complaints disposed off Nil Corporate Social Responsibility (CSR) The composition of CSR Committee is as under: 1. Shri V.K Goel, Chairman 2. Shri Gaurav Goel, Member 3. Shri Ashwani K Gupta, Member The Annual Report on CSR initiatives is attached as per Annexure-3. Conservation of energy, technology absorption, foreign exchange earnings and outgo The details of conservation of energy, technology absorption, foreign exchange earnings and outgo are given in the Annexure-4 attached to this report. Extract of Annual Return According to the provisions of Section 92(3) the prescribed Form MGT-9 (Extract of Annual Return) is attached as per Annexure-5. Details of Board Meeting held during the Year Details of the composition of the Board Meeting and the attendance at the meetings held during the financial year 2014-15 forms part of the Corporate Governance Report. Significant and Material Orders Passed by The Regulators, or Courts or Tribunals impacting the Going Concern Status and Company's Operations in Future There was no such order passed by the regulators or courts or tribunals impacting the going concern status and Company's operations in future. Acknowledgement Your Directors place on record their acknowledgement and sincere appreciation to the shareholders for their confidence in the management of the Company, the Central Government, the State Government, Banks and Financial Institutions for their continued support, the Cane Growers for their efforts in ensuring timely cane supply, the Company's officers and staff for their relentless and dedicated efforts, resulting in the Company's growth and look forward to a bright future. By Order of the Board of Directors V. K. Goel Chairman Place: New Delhi Dated: 27.05.2015 |