DIRECTORS' REPORT TO THE MEMBERS, Your Directors present their Thirtieth Report together with the Audited Accounts for the year ended 31st March, 2015 FINANCIAL SUMMARY OR HIGHLIGHTS In the financial year 2014-15, the Company has incurred losses of Rs. 46,79,000 as against Rs.46,83,000 in the previous year. STATUS WITH BIFR As reported in the earlier Annual Reports, the Company is a sick Company, registered with BIFR. The status and updates on the same has been discussed in the Management discussion and analysis Report annexed herewith. EXTRACT OF THE ANN UAL RETU RN: Pursuant to Section 134(3)(a) of the Companies Act, 2013 an extract of the Annual Return in Form No. MGT - 9 is annexed herewith. BOARD OF DIRECTORS MEETING: During the year ended 31st March, 2015, the Company had Six (06) Board Meetings and the gap between the two meetings of the Board is as per Companies Act, 2013. The following dates, namely 30th April, 2014, 30th May, 2014, 12th August, 2014, 14th November, 2014, 13th February, 2015 and 20th March, 2015. DIRECTORS' RESPONSIBILITY STATEMENT Pursuant to Section 134 (5) of the Companies Act, 2013, the Board of Directors of the Company hereby states and confirms that:- (i) In the preparation of the Annual Accounts, applicable accounting standards have been followed along with proper explanation relating to material departures; (ii) The Directors have selected such accounting policies and applied them consistently and made judgments and estimates that were 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 accounting year and of the loss of the company for that year; (iii) The Directors have 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; (iv) The Directors have prepared the Annual Accounts on a going concern basis (v) 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. (vi) The Directors have devised proper system to ensure compliance with the provision of all applicable loss and that such systems were adequate and operating effectively. AUDITORS M/s. S.K.Kavathekar & Co, Chartered Accountants, the Auditors of the Company holds office until the conclusion of the ensuing Annual General Meeting and have confirmed their eligibility and willingness ti accept the office, if reappointed. Remarks made by the auditors in their report read with notes to accounts thereon are self explanatory. SECRETARIAL AUDIT REPORT The Board appointed M/s. Nilesh A Pradhan & co, Practicing company secretaries to conduct secretarial Audit for F.Y. 2014-15. The Secretarial Audit Report is annexed herewith. The remarks made by the secretarial Auditor are self explanatory. The company could not comply with certain requirements due to continued dislocation in the administrative set up of the company, The Board is takilg all remedial measures to set right the deficiencies and comply with non compliances herewith. The company has also sought directions from Hon'ble BIFR for exempting the company, its Directors and Officers from any consequences pursuant to such non compliances. REMUNERATION POLICY The Board of Directors has on recommendations of the Nomination & Remuneration Committee outlined policy for selection & appointment of Directors, Key Managerial Personnel & Senior Management and also to decide their remuneration along with the perks. The Nomination & Remuneration Committee revises the remuneration from time to time depending upon the performance of the Company and the Individual Director's/Key Managerial Personnel and other Senior Management Personnel. The remuneration policy, takes into account the circumstance of business so as to attract and retain quality talent and leverage performance significantly DIRECTORS AND KEY MANAGERIAL PERSONNEL Mr S.M. Shetty, Chairman and Managing Director of the Company retires by rotation and being eligible offers himself for reappointment. Mr. C.R. Murali, Director of the Company is being appointed as an Independent Director for a period of three years upto 21st September, 2018. Mr. Sharad Sanghvi, an Independent Director, has stepped down from the Board w.e.f. from 10th April, 2015 and Mr. Nilesh Gandhi was appointed as additional Independent Director on 10th April, 2014. Your directors seek member's approval for his appointment as the Independent Director, not liable to retire by rotation. During the year under review, Mrs. Vaishali Shetty Oza was appointed as Woman Director w.e.f. 20th March, 2015 who resigned from the board w.e.f 27th May, 2015. Mrs. Priti Gandhi was subsequently appointed as Additional independent director on 27th May, 2015. Your directors seek member's approval for her appointment as the Independent Director, not liable to retire by rotation. Also, the Company is yet to comply with Section 203 of the Companies Act 2013 regarding non appointment of Key managerial personnel- Company Secretary and CFO since the Company is a sick Company registered under BIFR. Despite of best efforts of the Board of Directors, the Company is yet to identify and appoint a Company Secretary and CFO. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS U/S 186 There were no loans or guarantees given or any investments made during the year under review. PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES REFERRED TO IN SUB SECTION (1) OF SECTION 188 All contracts/arrangements/transactions entered by the Company during the financial year with related parties were in the ordinary course of business and on arms-length basis. Note2.28 to the Financial Statements covers the disclosure and hence the Company has nothing to reflect as disclosure in form AOC-2. DEPOSITS During the year under review, your Company has not accepted any deposits within the meaning of provisions of Chapter V - Acceptance of Deposits by Companies of the Companies Act, 2013 read with the Companies (Acceptance of Deposits) Rules 2014, as amended from time to time. DIVIDEND Your Directors regret that due to accumulated losses, no dividend could be recommended for the year. RESERVES Since the company has accumulated losses, no amount has been transferred to Reserves. MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY WHICH HAVE OCCURRED BETWEEN MARCH 31, 2015 AND AUGUST 12, 2015 (DATE OF THE REPORT) There are no material changes and commitments to report 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 except as under: 1. In pursuance of orders of BIFR, The Company has submitted a Modified Draft Rehabilitation Scheme (MDRS) for meeting the residual liabilities of the Company and for expanding the business domain of the Company. The same is under consideration by BIFR/IDBI. 2. In pursuance of the MDRS under consideration by BIFR/IDBI, the strategic investor identified by the Promoter has deposited an amount of Rs. 90 Lacs to part finance the cost of Rehabilitation Scheme. 3. Further in pursuance thereof, the strategic investor have also acquired 23.94% of the shares of Promoters and the particulars of the acquisition have been informed to the regulatory authorities including BIFR/IDBI etc. However, the acquired shares have not yet been delivered for formal transfer to the Company or Registrar and Transfer agents. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNING AND OUTGO The Company did not have any major power and fuel consumption during the year under consideration. No foreign exchange earnings and expenditure were made during the year under consideration. And hence the company has nothing to report as an annexure required under rule 8(3) of Companies (Accounts) Rules, 2014. MANAGEMENT DISCUSSION & ANALYSIS Management's Discussion and Analysis Report for the year under review, as stipulated under Clause 49 of the Listing Agreement with the Stock Exchanges in India, is presented in a separate section forming part of the Annual Report. DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS IMPACTING THE GOING CONCERN STATUS AND COMPANY'S OPERATIONS IN FUTURE. The Company is registered under BIFR and apart from that there are no other material orders passed by the regulators or courts or tribunals impacting the going concern status and Company's operations in future DETAILS OF HOLDING/SUBSIDIARIES/JOINT VENTURE/ ASSOCIATE COMPANY; M/s. Sai Ganesh Properties Pvt Ltd is the holding Company and the Company has no subsidiaries/Joint venture/Associate Company incorporated or ceased in the year 2014-15. PARTICULARS OF EMPLOYEES: In terms of the provisions of Section 197(12) of the Act read with Rules 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, a statement showing the names and other particulars of the employees drawing remuneration in excess of the limits set out in the said rules are required to be provided in the Annual Report. However there were no employees who were in receipt of remuneration for which details need to be disclosed. Hence, rule 5(2) and 5(3) are not applicable to the Company. SHARE CAPITAL: During the financial year there was no change in the Share Capital of the Company. COMMITTEES OF BOARD: Following are the various Committees formed by Board: • Audit Committee • Nomination & Remuneration Committee • Stakeholder Relationship Committee The details of the composition of committees, its roles and responsibility along with number of meetings held are given in the Report of Corporate Governance. As the Company is loss making, Constitution of the Corporate Social Responsibility Committee and policy is not applicable. CORPORATE GOVERNANCE : Report on Corporate Governance, as stipulated under Clause 49 of the Listing Agreements with the Stock Exchanges in India, forms part of the Annual Report. Certificate from the Auditor of the Company M/s. S.K. Kavathekar & Co, Chartered Accountants confirming compliance of conditions of Corporate Governance as stipulated under the aforesaid Clause 49 is annexed to this Report. PERFORMANCE EVALUATION OF BOARD AND INDEPENDENT DIRECTORS: Pursuant to the provisions of the Companies Act, 2013 and Clause 49 of the Listing Agreement, the Board has carried out the annual performance evaluation. The Board has evaluated performance of all the Directors and expressed its satisfaction. Evaluation procedure covered Board's functioning such as adequacy of the size and composition of the Board and its Committees to ensure diversity and adequate skills in the best interest of the Company as a whole. FAMILIARIZATION PROGRAMME FOR DIRECTORS The Company proactively keeps its Directors informed of the activities of the Company, its management and operations and provides an overall industry perspective as well as issues being faced by the industry. DISCLOSURES: i. Whistleblower Policy The Company has a Whistleblower Policy to report genuine concerns and grievances. The same is explained in the Corporate Governance Report. The practice of the Whistleblower Policy is overseen by the Audit Committee of the Board and no employee has been denied access to the Committee. ii. Prevention of Sexual harassment Policy During the year 2014-15, no complaints were received by the Company relating the sexual harassment. ACKNOWLEDGEMENT The Board takes this opportunity to thank and acknowledge with gratitude the co-operation and assistance received from various Government Authorities, Professionals and other Agencies during the accounting period under reference. The Directors also wish to place their deep appreciation to the continued trust and confidence reposed by the Shareholders of the Company. For and on behalf of the Board For SM DYECGHEM LIMITED S M Shetty Chairman & Managing Director Din No.: 00294206 Nilesh M Gandhi Director Din No.: 00028536 Date : 19 August, 2015 Place : Mumbai |