DIRECTORS REPORT TO THE SHAREHOLDERS Your Directors have pleasure in presenting to you the 71st Annual Report together with the audited accounts for the year ended 31st March, 2015: DIVIDEND Due to loss sustained by the Company the Directors are not in a position to recommend payment of any dividend to the members for the year ended 31st March, 2015. STATE OF COMPANY'S AFFAIRS Since April 2012, the production in the Tuticorin unit remains suspended, because of financial constraints and scarcity of raw materials. There was no manufacturing or sales during the year under report. The manufacturing activities at the Mettur Unit is also remain suspended. As regards Kalamassery unit, the company had signed an MOU with Godrej Properties Limited for a property Development Project. This was approved by the Hon'ble BIFR. However, on an application filed before AAIFR by a shareholder to stay the order of the BIFR, the appellate Authority for AAIFR, New Delhi ordered to maintain the Status quo. Now the matter is pending for order/s of appropriate authority. DIRECTORS AND KEY MANAGERIAL PERSONNEL Mr. George Varghese retire by rotation at the Annual General Meeting and being eligible have offered for reappointment. Mrs. Rani Jose was appointed as additional director with effect from 26.03.2015 to hold office up to the date of the AGM. Notice has been received for her appointment at the ensuing AGM as a director of the company, liable to retire by rotation. The board recommend her appointment. The company has received declarations from all the independent directors of the company confirming that they meet the prescribed criteria of independence. Being a sick unit for many year, the company has no key management personnel other than the Mg. director who is without remuneration. The independent directors have submitted declarations that each of them meets the criteria of independence as provided in Section 149(6) of the Act and that there has been no change in the circumstances which may affect their status of independence. ANNUAL EVALUATION The board of directors has carried out an annual evaluation of its own performance, Board committees and individual directors on the basis of inputs from all the directors on criteria such as Board composition and structure, meeting procedures and functioning, etc. A meeting of independent Directors, evaluated the performance of non-independent directors, the board as a whole DIRECTORS RESPONSIBILITY STATEMENT Your directors state that: I. In preparing the Annual Accounts for the year ended 31.03.2015, the applicable accounting standards have been followed and there are no material departures from the same. II. 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 or loss of the Company for the year ended on that date. III. The directors has 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. IV. That the Directors had prepared the accounts on a going concern basis, as manufacturing operations are being restarted and the BIFR revival scheme is under preparation. V The directors had laid down internal financial controls to be followed by the company and that such controls are adequate and operating effectively and VI. The directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively. LISTING The shares of the company are listed at the Mumbai Stock Exchange. The listing fees has been paid up to and including 2015-2016. CORPORATE GOVERNANCE REPORT & MANAGEMENT DISCUSSION & ANALYSIS Though clause 49 of the listing agreement is not mandatory to the company, it has substantially complied with all the corporate governance regulations and the report on corporate governance is annexed together with management discussion and analysis. EXTRACT OF ANNUAL RETURN The extract of annual return for the year ended 31.03.2015 in the prescribed format is annexed. AUDITORS AND AUDIT REPORT M/s. VBSK and Company, Chartered accountants, statutory auditors of the company appointed in the last AGM (2014) hold office until the conclusion of the annual general meeting for the financial year 2017-18, subject to approval of the ensuing AGM. The board recommend their continuation in office. As regards the qualifications, comments in the audit report for the year, your directors would submit that: I. The company is trying to obtain confirmation from debtors and creditors. However, the company being not in operation for a long period of time and registered with BIFR, there are limitations in this regard. II. The company, a sick unit without normal functioning, is trying to obtain certified copies of all documents in respect of the investment as these were lost / misplaced during the long period of closure of the company. III. The company is trying to get its applications for exception from land ceiling disposed of at the earliest. IV Letters of confirmations of deposits were sent to all parties who have not replied probably because the accounts are non operative for long time V Letters of confirmations of balances were sent to all banks who have not replied probably because the accounts are non operative for long period. VI. The company being closed for a very long period and continue to be a sick unit, necessary steps in respect of regularizing all statutory dues are being taken, considering the revival scheme pending with BIFR VII. The company was closed for a very long period and continue to be a sick unit though started functioning. The company has made an application to The Ministry of Corporate Affairs for waiver from maintaining cost accounting records. VIII. The company was closed for a very long period and continue to be a sick unit though started functioning. The company is in the process of ascertaining the status of the assets and its impairment. SECRETARIAL AUDIT REPORT M/s. K P Thomas & Co., Company Secretaries, were appointed as secretarial auditors of the company and their report in terms of section 204 of the Companies Act, 2013 is attached. As regards qualifications/comments in the report your directors would submit that: (i) The matter of cessation of office of director of Mr. T. Thirugnanam is sub-judice. (ii) The company being sick for many years has appointed only the Mg. director, without payment of any remuneration. Other appointments will be done on revival of operations (iii) the unpaid amount is being paid to IEP fund without further delay (iv) internal auditor will be appointed on revival of operations. (v) advt. not made due to paucity of funds. However, efforts are being made to comply. (vi) the matter of payment of labour dues is subject matter of BIFR scheme. AUDIT COMMITTEE The composition and details of meetings of the audit committee are included in the corporate governance report. There was no recommendation of the audit committee that was not accepted by the board. MEETING OF THE BOARD Five meetings of the board were held during the year. Details are included in the corporate governance report. PARTICULARS OF EMPLOYEES ETC. AS PER SECTION 197(12) No remuneration was paid to any of the directors and there was no employee in receipt of remuneration in excess of the limits in terms of Rule 5(2). PARTICULARS LOANS /INVESTMENTS /GUARANTEE UNDER SECTION186 No loan was given, investments made, or guarantee provided during the year attracting the provisions of S. 186 of the Companies Act 2013. STATEMENT ON CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND R&D Not applicable as the company had no operations during the year CONTRACTS ARRANGEMENTS WITH RELATAED PARTIES There was no contract or arrangement with related parties during the year, except the interest free unsecured loan from a director. RISK MANAGEMENT POLICY Being a sick unit registered with the BIFR, the company faces various risks — operational, financial, market share etc. A proper assessment can be possible only on approval of the revival scheme. Your directors are vigorously pursuing the BIFR proceedings. MATERIAL CHANGES AFFECTING FINANCIAL POSITION BETWEEN END OF YEAR AND REPORT DATE NIL DISCLOSURES NOT APPLICABLE DURING THE YEAR AS THERE WAS NO TRANSACTION OR INCIDENCE Details of deposits, Issue of equity shares with differential rights and to employees, Remuneration received by the Mg director and whole time directors from subsidiaries, Cases filed or reported pursuant to the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressel ) Act 2013, Orders passed by regulators, courts or tribunals that impact the going concern status and future operations of the company, CSR activities, Changes in subsidiaries, Changes in subsidiaries and changes in naturof business. ACKNOWLEDGMENTS Your directors wish to place on record their gratitude to companies, Customers for their continued patronage and concerned Banks for their guidance and co-operation. The Board also wished to place on record its appreciation for the co-operation extended by all ranks of employees and trade unions. By order of the Board For TCM LIMITED Joseph Varghese Managing Director T S Rajagopalan Director George Varghese Director Place: Ernakulam Date : 14.08.2015 . |