DIRECTORS’ REPORT FOR THE YEAR ENDED 31ST MARCH, 2016 TO, THE SHAREHOLDERS, Your directors have pleasure in submitting the ANNUAL REPORT relating to the affairs of the Company together with Audited Financial Statements of the Company for the year ended 31st March, 2016. DIVIDEND Directors recommend dividend of Rs. 100 per share including Rs. 45 per share as jubilee dividend celebrating hundred years (previous year Rs 55 per share). HOLDING COMPANY Paharpur Cooling Towers Limited (PCTL) controls the composition of the Board of Directors of the Company. Consequently the Company in terms of section 2(87) (i) read with Explanation (b) of the Companies Act, 2013 (hereinafter referred to as “the Act”), is the subsidiary of PCTL. DIRECTORS Mr. A.V. Setalvad (DIN 00056124) retires by rotation and being eligible offers himself for re-appointment KEY MANAGERIAL PEROSONNEL The following are the Key Managerial Personnel (KMP) a. Mr. Gaurav Swarup, Managing Director. b. Mr. A. K. Singhania, Chief Financial Officer. c. Mr. Hirak Ghosh, Company Secretary. All the above are also KMP of the PCTL (holding Company). Therefore their appointment is covered by section 203(3) of the Act. BONUS ISSUE The Board of Directors subject to various approvals, recommends issue of Bonus Shares in the ratio of 2 (two) Equity Bonus Shares of Rs. 10 each for every 1 (one) existing equity shares of Rs. 10 each to the shareholders of the Company on a date to be fixed by the Board of Directors. After issue of 11,63,560 Bonus shares as proposed, the paid equity capital of the Company will be increased to Rs. 1,74,53,400. Bonus shares will be issued by capitalization of General Reserves to the extent of Rs. 1,16,35,600. Necessary resolutions for issue of Bonus Shares and consequent increase in authorised capital and alteration of Memorandum and Articles of Association are set out in the accompanying notice of 100th Annual General Meeting. CHANGE OF REGISTERED OFFICE The Board of Directors at its meeting held on 30th May, 2016, subject to various approvals, has proposed to shift the Registered Office from the State of Maharashtra to the State of West Bengal. The change will help better administration and economy, reduce overheads and duplication of records. In accordance with the Section 110 of the Act read with the Rule 22 of the Companies (Management and Administration) Rules, 2014 the members consent is being obtained by Postal Ballot. A seperate notice is being issued in this regard. NUMBER OF MEETINGS OF THE BOARD During the financial year under review the Board of Directors met 5 (five) times. The details are given in the Corporate Governance Report (Annexure A). All suggestions of the Audit Committee have been accepted by the Board. DIRECTORS’ RESPONSIBILITY STATEMENT Pursuant to Section 134(3)(c) and sub section (5) of the Act, your Directors confirm that: (a) In the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any. (b) Appropriate accounting policies have been selected and applied consistently and that the judgements and estimates made are reasonable and prudent so as to give a true and fair view of the affairs of the Company for the year ended March 31, 2016 and of the profit for the year under review. (c) proper and sufficient care have been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities; (d) the annual accounts have been prepared on a ‘going concern’ basis. (e) internal financial controls have been laid down and followed by the company and such internal financial controls are adequate and operating satisfactorily. (f) there is proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively. AUDIT COMMITTEE Members of the Audit Committee are Mr. A.R. Broacha, Mr. A.K. Modi and Mr. A.V. Setalvad. Details of the said committee are set out in the Corporate Governance Report (Annexure A). A STATEMENT OF DECLARATION BY INDEPENDENT DIRECTORS Mr. A R Broacha, Mr. A K Modi and Mrs. Binaisha Sundaram, independent directors have furnished declarations that they meet the criteria of independence as laid down under section 149(6) of the Companies Act, 2013 and of LODR. POLICY ON DIRECTORS’ APPOINTMENT, REMUNERATION AND CRITERIA OF INDEPENDENCE OF DIRECTORS Nomination and Remuneration Committee recommends to the Board appointment of director, and payment of commission in accordance with the limits approved by the members. With regard to remuneration, except Mr. G Swarup all the Directors are non- executive directors. Mr. Swarup does not draw any remuneration except sitting fees. Directors are paid sitting fee as well as commission based on the net profits of the Company. The members have approved payment of commission within the limit laid down in the Act. SECRETARIAL AUDIT REPORT Pursuant to Section 204 of the Act, the Board of Directors has appointed Mayur Mehta, PCS as secretarial auditor. Secretarial Audit Report received from Mayur Mehta is enclosed (Annexure C). PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS The Company’s principal business is dealing in investments and securities and it is registered as NBFC with the Reserve Bank of India. As nothing in Section 186, except sub Section (1) of the Act applies in accordance with section 186(11) details are not required to be given. However Note 7 and 9 of the attached financial statement give details of the same. PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES There are no material related party transactions during the year under review with the promoters, directors, Key Managerial Personnel and their relatives. Therefore no details are required to be disclosed in the Form AOC 2. MATERIAL CHANGES AND FINANCIAL COMMITMENTS, IF ANY, No material changes and financial commitments have occurred between the end of the financial year of the Company to which the balance sheet relates and the date of this Report. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGOINGS There are no particulars to be disclosed with regard to • conservation of energy, • technology absorption and • foreign exchange earnings and outgoings RISK MANAGEMENT The principal business of the company is dealing in investments and securities which are subject to market risks. The Board of Directors/Committee of Directors take policy decision on deployment of funds of the Company in securities market based on investment climate and economic conditions in the country and movement in the stock markets. The investment portfolio is periodically reviewed by the Board of Directors and cautious approach is a key note of the policy to mitigate risks. CORPORATE SOCIAL RESPONSIBILITY Members of the Corporate Social Responsibility are Mr. A. V. Setalvad (Chairman), Mr. A. R. Broacha and Mr. G. Swarup. Based on the recommendation of Corporate Social Responsibility Meeting, the Board has adopted CSR Policy. It is available on the Website of the Company. Based on the recommendation of CSR Committee, budgeted expenditure for the year ended 31st March, 2015 of Rs.10 lacs was approved. The entire Rs.10 lacs has been contributed to Jnana Prabodhini Shivapradesh, Pune. The said project has progressed satisfactorily. For the year 31st March, 2016 a budget of Rs. 11.25 lacs has been fixed. The same has been provided in the books of accounts. Based on the progressive report received the amount would be spent on the project. CHANGE IN BUSINESS There has been no change in the nature of business of the Company. DEPOSITS The Company had no deposits at the beginning of the Financial Year. It has not accepted any deposits from its members/directors. The Company does not have any outstanding deposits at the end of the Financial Year. SIGNIFICANT MATERIAL ORDERS Save as mentioned in the Report on Corporate Governance (Annexure A) under para 8(V) Disclosure, no and material orders have been passed by the regulators or courts or tribunals impacting the going concern status and the Company’s operations in future. INTERNAL FINANCIAL CONTROL The quality of internal financial procedure and control observed by the management and its officials are commensurate with the size and the operations of the Company. DISCLOSURE OF REMUNERATION VIS A VIS EMPLOYEES No disclosure is required to be made pursuant to Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 as there is only one male employee of the Company. Further non-executive directors are paid commission related to profits and fees. The Managing Director is not paid remuneration. The Company has no employees covered under Rule 5 (2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014. UNCLAIMED SECURITIES In accordance with Regulation 39 read with Schedule VI, the Company has transferred unclaimed securities to “Industrial Prudential Unclaimed Securities Suspence Account” on 5th May, 2016. Aggregate number of shareholders is 330 holding 8703 shares. The voting rights on these shares shall remain frozen till the rightful owner of such shares claims the shares. AUDITORS’ REPORT There are no qualifications or adverse remarks in the Auditors’ Report. AUDITORS In accordance with Section 139 of the Act read with Rules made thereunder, the Company at the Annual General Meeting held on 24th September, 2014 appointed Messrs. V S Somani & Co., Chartered Accountants, the existing statutory auditors (being a sole proprietary firm) for a period of three years. The appointment is to be ratified by members at every annual general meeting thereafter. In accordance with provisions of Section 139 of the Act, the Board of Directors has received consent and certificates of eligibility and compliance of criteria under Section 141 of the Act from Messrs. V S Somani & Co., Chartered Accountants, Mumbai. Members are requested to ratify the appointment of the existing statutory auditors Messrs. V S Somani & Co., Chartered Accountants, and to fix their remuneration. On behalf of the Board of Directors A. V. SETALVAD Chairman Registered Office: 125, Maker Chambers III, Nariman Point, Mumbai-400 021. Place : Mumbai, date : May 30, 2016. |