BOARD'S REPORT Dear Shareholders, 1. Your Directors have pleasure in submitting the Twenty Eigth Annual Report together with Audited Statement of Accounts of the Company for the year ended 31st March, 2015. 2. REVIEW OF OPERATIONS: During the year under review, your Company has made a Gross Income of Rs 4629.68 Lacs when compared to Rs. 4024.46 Lacs in the earlier year. Net profit before Taxation earned during the year under review amounted to Rs.223.01Lacs, as against Rs. 64.62 Lacs in the previous year. Profit after Tax was at Rs. 144.95 Lacs as against Rs. 45.53 Lakhs of earlier year. 3. DIVIDEND To conserve the reserves of the Company, the Company has not proposed any dividend during the year. 4. RESERVES: The Company proposes to transfer Rs. 144.95 Lacs to General Reserves for the FY 2014-15. With this addition, the total Reserves & Surplus (including Capital Reserve, Securities Premium Reserve, Central Subsidy, General Reserve and Surplus) as on March 31, 2015 is Rs. 423.04 Lacs as against the Paid up Capital of Rs. 390.03 Lacs. 5. DIRECTORS Mr. Rajkumar Inani, Managing Director retires at this Annual General Meeting and being eligible offer himself for reappointment. His designation was changed from Whole Time Director to Managing Director at the Annual General Meeting of the Company held on 30/09/2014. Further the Board of Directors of the Company at their meeting held on 31/07/2015 changed the remuneration of Mr. Rajkumar Inani from Rs. 85000 per month to Rs. 90,000 per month w.e.f. 01/07/2015 for the remaining tenure of his appointment as Managing Director and the same has being put for approval of member at this Annual General Meeting. Mrs. Natasha Inani, was appointed as Additional Director on 10/03/2015 and she holds office till the date of this Annual General Meeting. A notice has been received from a member proposing her candidature for reappointment as Director and the same has being put for approval of member at this Annual General Meeting. Further during the year under review Mr. Shyam Sunder Jakhotia Independent Director was appointed as Chairman with effect from 10/03/2015 and Mr. Narayan Inani, was appointed as CFO of the company w.e.f. 30/05/2014. Also the term of Mr. Airudh Inani who was appointed as Whole Time Director on 30/06/2009 came to end on 29/06/2014. He was further appointed as Whole Time Director at the Annual General Meeting of the Company held on 30/09/2014 Also the term of Mr. Narayan Inani who was appointed as Executive Director on 01/07/2010 came to end on 30/06/2015. He was further appointed as Executive Director w.e.f 01/07/2015 at the Meeting of the Board of Directors of the Company held on 31/07/2015 and the same has being put for approval of member at this Annual General Meeting. Mr. Shyam Sunder Jakhotia, Mr. K.N.Prasad and Mr. Simanth Roy Chowdhury were appointed as Independent Director w.e.f 01/04/2014 for a term of Five years. 6. INDEPENDENT DIRECTORS The Independent Directors have submitted their disclosures to the Board that they fulfill all the requirements as stipulated in Section 149(6) of the Companies Act, 2013 so as to qualify themselves to be appointed as Independent Directors under the provisions of the Companies Act, 2013 and the relevant rules. 7. NUMBER OF BOARD MEETINGS CONDUCTED DURING THE YEAR UNDER REVIEW The Board of Directors met Five (5) times on 30th May, 2014, 31st July, 2014, 31st October, 2014, 31st January, 2015 & 10th March, 2015 during the financial year 2014-15. 8. DIRECTORS RESPONSIBILITY STATEMENT In accordance with the provisions of Section 134(5) of the Companies Act, 2013 the Board hereby submit its responsibility Statement:— a) in the preparation of the annual accounts, 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 at the end of the financial year 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; and e) the directors, in the case of a listed company, had laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively. Internal financial control means the policies and procedures adopted by the Company for ensuring the orderly and efficient conduct of its business including adherence to Company's policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records and the timely preparation of reliable financial information. 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. 9. STATUTORY AUDITORS M/s G.D Upadhyay & Co, Chartered Accountants, were appointed as Statutory Auditors for a period of 3 years at the Annual General Meeting held on 30/09/2014 subject to the ratification of their appointment at every Annual General Meeting. Their continuance of appointment is to be ratified by the members at the ensuing Annual General Meeting. The Company has received a certificate from the above Auditors to the effect that if they are reappointed, it would be in accordance with the provisions of Section 141 of the Companies Act, 2013. M/s. Vinay Surana & Co., Chartered Accountants are the Internal Auditors of the Company and M/s Manjeet Bucha & Associates, Company Secretaries are the Secretarial Auditors of the Company. 10. AUDITORS REPORT There was no qualifications, reservations or adverse remarks made by the Statutory Auditors of the Company in their Auditors reports. Further there was no qualifications, reservations or adverse remarks made by the Secretarial Auditors of the Company in their Secretarial Auditor Reports except in respect of the following matters : Failure to publish newspaper advertisement for Book Closure, Non filing of Disclosures as required under SEBI (SAST) Regulations, 2011 and SEBI (Prohibition of insider Trading) Regulations, 1992, Appointment of Company Secretary as KMP as required under section 203 of the Companies Act, 2013 and Clause 47 of the Listing Agreement and failure to provide voting facility through electronic means. The failure with respect to publication of News Paper Advertisement for Book Closure and submission of disclosures was due to oversight of the Secretarial Department and your Board after taking note of the same has established system for ensuring proper and regular compliances in the matters specified above. Further as the registered office of the company is situated at a remote place and thus the company is unable to find a candidate for the post of Company Secretary. The Requirements of providing voting facility through electronic means was introduced by implementation of the provisions of section 108 of the Companies Act, 2013 w.e.f 01st April, 2015 however, Ministry of Corporate Affairs vide its Circular No. 20/2014 dated 12th June, 2014 clarified that e-voting facility need not provided till 31st December, 2014, however Clause 35B of the listing agreement required for providing e-voting facility. Due to the shortage of time for implementation of e-voting facility and few number of agencies providing e-voting facility, company could not make necessary arrangements with the agencies in that short period and hence the same was not provided. However your Board of Directors taking note of the same has proposed all the resolutions to be passed at that ensuing Annual General Meeting through e-voting. 11. ANNUAL RETURN The extracts of Annual Return pursuant to the provisions of Section 92 read with Rule 12 of the Companies (Management and Administration) Rules, 2014 is furnished in Annexure A and is attached to this Report. 12. SUBSIDIARIES, JOINT VENTURES AND ASSOCIATE COMPANIES The Company does not have any Subsidiary, Joint venture or Associate Company. 14. RELATED PARTY TRANSACTIONS The particulars of Contracts or Arrangements made with related parties made pursuant to Section 188 is furnished in Annexure B and is attached to this report. 15. DEPOSITS The Company has neither accepted nor renewed any deposits during the year under review. 16. LISTING: Your Company's shares are presently listed on The Bombay Stock Exchange Limited. Your Company is regular in payment of listing fees to The Bombay Stock Exchange Limited; Scrip Code is 521216 & Scrip ID: DHANROTO. 17. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO As required by the provisions of Companies Act, 2013, the relevant information pertaining to conservation of energy, technology absorption and foreign exchange earnings and outgo are given under: A. Conservation of Energy: Adequate measures have been taken to reduce energy consumption, wherever possible. There were no additional investments made for the conservation of energy during the period under review. B. I) Research and Development (R&D): a) Specific areas in which R&D has been carried out by the company: NIL b) Benefits derived as a result of the above R&D: NIL c) Future plans of action: NIL d) Expenditure on R&D: NIL II) Technology Absorption, Adaptation and Innovation: a) Technology Imported: NIL b) Year of Import: NIL c) Has the technology been fully absorbed: NIL d) Technical collaborator: NIL 18. PARTICULARS OF EMPLOYEES There is no employee who if employed throughout the financial year, was in receipt of remuneration for that year which, in the aggregate, was not less than sixty lakh rupees or if employed for a part of the financial year, was in receipt of remuneration for any part of that year, at a rate which, in the aggregate, was not less than five lakh rupees per month or if employed throughout the financial year or part thereof, was in receipt of remuneration in that year which, in the aggregate, or as the case may be, at a rate which, in the aggregate, is 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 and thus consequently no information is required to be provided in this regard in accordance with the provisions of Companies (Appointment and Remuneration Managerial Personnel) Rule, 2014 of the Companies Act, 2013 . 19. ADEQUACY OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THE FINAN - CIAL STATEMENTS The Company has effective 'internal financial controls' that ensure an orderly and efficient conduct of its business, including adherence to company's policies, safeguarding of its assets, prevention and detection of frauds and errors, accuracy and completeness of the accounting records, and timely preparation of reliable financial information. There are adequate controls relating to strategic, operational, environmental and quality related aspects too. While these controls have been effective through-out the year, these are reviewed on a periodic basis for any changes/ modifications to align to business needs. 20. TRANSFER OF UNCLAIMED DIVIDEND The provisions of Section 125(2) of the Companies Act, 2013 do not apply as there was no dividend declared and paid last year. 21. MATERIAL CHANGES AND COMMITMENT IF ANY The term of Mr. Narayan Inani who was appointed as Executive Director on 01/07/2010 came to end on 30/06/2015. Board of Directors of the Company at their meeting held on 31/07/2015 appointed him as Executive Director w.e.f 01/07/2015 and the same has being put for approval of member at this Annual General Meeting. Further the Board of Directors of the Company at their meeting held on 31/07/2015 changed the remuneration of Mr. Rajkumar Inani from Rs. 85000 per month to Rs. 90,000 per month w.e.f. 01/07/2015 for the remaining tenure of his appointment as Managing Director and the same has being put for approval of member at this Annual General Meeting. Also the term of Mr. Anirudh Inani who was appointed as Whole Time Director on 30/06/2009 came to end on 29/06/2014. He was further appointed as Whole Time Director at the Annual General Meeting of the Company held on 30/09/2014 Also the Board of Directors of the Company at their meeting held on 31/07/2015 changed the term of appointment of Mr. Anirudh Inani for a period of 3 years w.e.f 01/07/2015 and the same has being put for approval of member at this Annual General Meeting. Mr. Shyam Sunder Jakhotia, Mr. K.N.Prasad and Mr. Simanth Roy Chowdhury were appointed as Independent Directors w.e.f. 01/04/2014 for a term of Five years. 22. RISK MANAGEMENT POLICY The Board of Directors of the Company formulates, implements and monitors the risk management framework for the Company. The Board evaluates risk management systems and internal financial controls. The Board reviews the internal audit findings, provides guidance on internal controls and ensures that the internal audit recommendations are implemented. The responsibility for management of risks vests with the Managers responsible for the day-today conduct of affairs of the Company. The Managers are required to ensure that Standard Operating Procedures (SOPs) for major areas of operations are in place, clearly delineating the accountabilities in the systems/ process chains. Such SOPs are also required to be regularly reviewed for ensuring superior quality thereof. 23. CORPORATE SOCIAL RESPONSIBILITY The Company has not developed and implemented any Corporate Social Responsibility initiatives as the said provisions are not applicable. 24. CORPORATE GOVERNANCE AND SHAREHOLDERS INFORMATION: Since the Paid up Capital of the Company is less than Rs. 10 Crores and Networth of the Company is less than Rs. 25 Crores, Corporate Goverance is not applicable. 25. COMPANY'S POLICY RELATING TO DIRECTORS APPOINTMENT, PAYMENT OF REMUNERATION AND DISCHARGE OF THEIR DUTIES The company has Nomination and Remuneration committee consisting of Mr. Shyam Sunder Jakhotia, as Chairman and Mr. K.N. Prasad and Mr. Simanth Roy Chowdhury as members. The remuneration and sitting fees paid to the Board members are based on the recommendation of Nomination and Remuneration Commiitee. The Committee takes into consideration the experience and expertise of the Board and other members before recommending the remuneration to be paid to them. Remuneration to Directors : The remuneration and perks paid during the year to Mr. Anirudh Inani, whole time Director is Rs. 7,35,000, Mr. Rajkumar Inani, Managing Director is Rs. 10,20,000 and Mr. Narayan Inani Executive Director is Rs. 10,20,000. 26. COMPOSITION OF AUDIT COMMITTEE AND VIGIL MECHANISM The company has Audit Committee consisting of Mr. K.N.Prasad, as Chairman and Mr. ShyamsundarJakhotia and Mr.Narayan Inani as members. The Company has established a vigil mechanism and overseas through the committee, the genuine concerns expressed by the employees and other Directors. The Company has also provided adequate safeguards against victimization of employees and Directors who express their concerns. The Company has also provided direct access to the Chairman of the Audit Committee on reporting issues concerning the interests of co- employees and the Company. 27. BOARDS EVALUATION The Board of Directors of your company has devised a Policy for annual evaluation of its own performance, performance of its Independent Directors, Committees and other individual Directors which include criteria for performance evaluation of the non-executive directors and executive directors. 28. SHARE CAPITAL The company has not altered its authorized share capital during the financial year 2014-15 and also has not issued any shares during the said year. Further no securities were bought back by the Company during the year under review. 29. POLICY ON SEXUAL HARASSMENT The Company has adopted policy on Prevention of Sexual Harassment of women at Workplace in accordance with The Sexual Harassment of women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. During the year under review, the Company has not received any complaints pertaining to Sexual Harassment. 30. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS There are no significant and material orders that were passed by the regulators or courts or tribunals against your Company. OTHER DISCLOSURES: There was no increase in remuneration payable to Directors and the number of permanent employees of the company are Sixteen. There was no change in the remuneration paid to the employees during the financial year. The profit after tax for the financial year ended 31st March, 2015 increased by 218 %, however, there is no increase in the remuneration paid to Directors. The total remuneration paid to Directors was Rs. 27,75,000 against the net profits of the company after tax amounting to Rs. 1,44,95,779. Against the net profits after tax of Rs. 1,44,95,779, Mr. Raj Kumar Inani was paid remuneration of Rs. 10,20,000, Mr. Narayan Inani was paid remuneration of Rs. 10,20,000 and Mr. Anirudh Inani was paid remuneration of Rs.7,35,000. There is no employee receiving any remuneration in excess of remuneration paid to any Director. Further the remuneration payable to Directors is as per the remuneration policy of the Board of Directors as recommended by Nomination and Remuneration Committee. 32. ACKNOWLEDGEMENTS Your Directors place on record their sincere thanks to bankers, business associates, consultants,and various Government Authorities for their continued support extended to your Company activities during the year under review. Your Directors also acknowledges gratefully the shareholders for their support and confidence reposed on your Company. By Order of the Board For DHANALAXMI ROTO SPINNERS LIMITED (RAJKUMAR INANI) Managing Director (DIN : 00885466) For DHANALAXMI ROTO SPINNERS LIMITED Sd/- (NARAYAN INANI) Executive Director cum CFO (DIN : 00525403 Place : Thimmapur Date : 31.07.2015 |