MINAXI TEXTILES LIMITED DIRECTORS' REPORT To, The Members, Minaxi Textiles Ltd Your directors have pleasure in presenting herewith their Twentieth Annual Report together with the Audited Statements of Accounts for the period ended on 31st March, 2015. DIVIDEND : Your directors do not recommend any dividend for the financial year ended on 31st March, 2015 and decided to plug in the profit for ongoing projects. OPERATING AND FINANCIAL PERFORMANCE, INTERNAL CONTROL : In the face of overall subdued market conditions, our company has delivered growth and performed well. This year, the company's total revenue from operations increased by Rs. 179.91 Lacs despite slow down in the economy. During the year under report, the company has achieved a gross turnover of Rs.5448.08 Lacs as compare to Rs.5268.16 Lacs during the previous year and the operations for the year under review has resulted in the net profit of Rs.151.60 Lacs Your company could achieve stable growth in business due to continued pursuit of strategy to work with innovative ideas, developing areas of its activities and reducing cost of production through process innovation. Directors hope even better performance during the current year. There is no change in the nature of the business of the company. The company has no subsidiaries or associate companies therefore disclosures in this regards are not provided in this report. There where no significant and material orders passed by regulators or courts or tribunals impacting the going concern status and company's operations in future. There where no material changes and commitments affecting the financial position of the company occurring between March 31, 2015 and the date of this report of the directors. The company has in place an established internal control system designed to ensure proper recording of financial and operational information and compliance of various internal controls. TRANSFER TO RESERVES : The amount of Rs.151.60 Lacs proposes to transfer to the reserves. QUALITY, HEALTH, SAFETY & ENVIRONMENT (QHSE) Minaxi's commitment towards excellence in Health, Safety and Environment is one of the company's core values by complying with the Laws and Regulations first, and then going beyond the mandate to keep our plant safe for future generations. Minimizing the environment impact of our operations assumes utmost priority. The company is unwavering in its policy of 'safety of persons overrides all production targets' which drives all employees to continuously break new grounds in safety management for the benefit of the people, property, environment and the communities in which Minaxi operates. Our comprehensive QHSE Policy, as well as dedicated measures by conducting the Risk Assessment, Identification of significant environment aspects of manufacturing plant and signatory commitment of Responsible Care, Greatest emphasis is given to safety measures for minimizing accidents and incidents. CORPORATE SOCIAL RESPONSIBILITY (CSR) : (Criteria prescribed under section 135 is not attracted) Every Company is required to constitute / formulate CSR Committee if it gets attracted in one of the criteria prescribed in Section 135. According to Section 135 of the Companies Act, 2013, Every Company having Net Worth of Rs.500 Crore or More, or Turnover of Rs.1000 Crore or more, or Net Profit of Rs.5 crore or more during any financial year shall constitute a Corporate Social Responsibility Committee and should undertake Corporate Social Responsibility as prescribed in Schedule VII. None of the above criteria was applicable to the company for the financial year 2014-2015 and hence the company was not required to constitute CSR Committee. FINANCE : The Company is at present enjoying financial assistance in the form of working capital facilities and term loan from Bank of India, Main Branch, Bhadra, Ahmedabad. During the year under review, the company regularly paid the principal and interest to the Bank. PUBLIC DEPOSIT : The company has paid off the public deposit accepted pursuant to the Companies Act, 1956 under the ambit of Statement in Lieu of Advertisement prior to the commencement of the Companies Act, 2013. The Company has not accepted deposit from the public falling within the ambit of Section 73 of the Companies Act, 2013 and the Companies (Acceptance of Deposits) Rules, 2014 during the year under review. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS / OUTGO : The information relating to conservation of Energy, Technology, Absorption and Foreign Exchange Earning / Outgo as required under section 134(3)(m) of the Companies Act, 2013 read with the Rule 8 of the Companies (Accounts) Rules, 2014 is given by way of annexure attached hereto which forms part of this report. (Annexure - I) PARTICULARS OF EMPLOYEES : The prescribed particulars of Employees required under section 197(12) read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is attached hereto which forms part of this report. (Annexure - II) During the year under review none of the employees of the company was in receipt of remuneration in excess of Rs.60Lacs, if employed through out the year or in receipt of remuneration exceeding Rs.5 Lac p.m., if employed for part of the financial year, and hence the disclosure under section 197(12) read with Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is not applicable. BOARD OF DIRECTORS : In accordance with provisions of Section 152(6)(a) of the Companies Act, 2013, Shri Nirmal B. Patel and Shri Dinesh P. Patel retires by rotation and being eligible offers themselves for re-appointment. According to Section 149(13) of the Act, the independent directors are the directors who are not liable to retire by rotation. Smt. Manjulaben Patel has been appointed as Non- Executive Women Director as Additional Director on the Board of the company vide its meeting held on 11th February, 2015 in due compliance of Section 149 of the Companies Act, 2013 and Clause 49(II)(A)(1) of the Listing Agreement entered into with Stock Exchange. Shri Jinal Patel has been appointed as Independent Additional Director by the Board of Directors vide its meeting held on 07th May, 2015 in due compliance of Section 149 of the Companies Act, 2013 and Clause 49(II)(A)(2) of the Listing Agreement. Board Evaluation : Pursuant to the provisions of Section 178(2) of the Companies Act, 2013 and Clause 49 of the Listing Agreement, the Board has carried out an annual performance evaluation of its own performance, the directors individually as well as the evaluation of the working of its Audit, Nomination and Remuneration and Stake holder Relationship Committees. The manner in which the evaluation has been carried out has been explained in the Corporate Governance Report. Remuneration Policy : The Board has, on the recommendation of the Nomination and Remuneration Committee framed a policy for selection and appointment of Directors, Senior Management and their remuneration. The Remuneration Policy is stated in the Corporate Governance Report. Meetings : The agenda of Meetings is prepared and circulated to the Directors. During the year seven Board Meetings were convened and held. The details of which are given in the Corporate Governance Report. The intervening gap between the meetings was within the period prescribed under the Companies Act, 2013. Statement On Declaration Given By Independent Directors : The Independent Directors have submitted the declaration of their Independence, as required pursuant to Section 149(7) of the Companies Act, 2013, stating that they meet the criteria of independence as provided in sub-section (6) of that section. DISCLOSURE OF COMPOSITION OF AUDIT COMMITTEE : The Board of directors of the company at its meeting held on 30th May, 2014 has reconstituted an Audit Committee, in line with Section 177 of the Companies Act, 2013, comprising five independent Non-Executive Directors viz. Shri. Jashwantkumar K. Patel, Chairman (having financial and accounting knowledge), Shri. Vasudevbhai L. Patel, Shri.Dharmendra N. Patel, Shri. Ghanshyambhai C. Patel and Shri. Sandipkumar J. Patel. The constitution of Audit Committee meets with the requirements under Clause 49 of the Listing agreement of the Stock Exchange(s) as well. The Committee periodically discussed the Financial Reporting process, reviewed the Financial Statements, and discussed the quality of the applied accounting principles and significant judgment that affected the Company's Financial Statements. Before presenting the audited accounts to the members of the Board, the Audit Committee recommended the appointment of the statutory auditors and internal auditor, subject to the Board's approval. The audit Committee reviewed with adequacy of internal control systems with the management, statutory and internal auditors. RE-CONSTITUTION AND DISCLOSURE OF POLICY OF NOMINATION AND REMUNERATION COMMITTEE (NRC) : Pursuant to the provisions of Section 178 of the Companies Act, 2013 read with Companies (Meetings of Board and its Powers) Rules, 2014, every listed company and prescribed class of companies, shall constitute Nomination and Remuneration Committee (NRC) of the Board consisting of 3 or more non-executive directors out of which not less than 1/2 shall be independent director. The composition of the NRC also meets with the criteria laid down in the Clause 49 of the Listing Agreement. In view of the above provision of law, the Board of Directors at its meeting held on 30th May, 2014 has constituted NRC committee and Re-constituted the same vide its meeting held on 11th February, 2015 consisting of Shri Ghanshyam C. Patel, Chairman of the Committee/ Independent Director, Shri. Vasudevbhai L. Patel, Independent Director and Shri Sandipkumar Patel, Independent Director of the company, as member of the committee. The NRC Policy, recommended by the Committee to the Board, relating to the remuneration of the directors, key managerial personnel and other employees, lay down and ensure a. The level and composition of remuneration is reasonable and sufficient to attract, retain and motivate directors of the quality required to run the company successfully. b. Relationship of remuneration to performance is clear and meets appropriate performance benchmarks, and c. Remuneration to directors, key managerial personnel and senior management involves a balance between fixed and incentive pay reflecting short and long term performance objectives appropriate to the working of the company and its goals. VIGIL MECHANISM / WHISTLE BLOWER POLICY The Company has a vigil mechanism / Whistle Blower Policy to deal with unethical behaviour, actual or suspected fraud or violation of the Codes of conduct or policy. The mechanism provides for adequate safeguards against victimization of employees and Directors to avail of the mechanism and also provide for direct access to the Chairperson of the Audit Committee in exceptional cases. The details of the Policy is also posted on the website of the Company. DISCLOSURE UNDER THE SEXUAL HARRASSMENT 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 & Redressal) Act, 2013. The company has constituted Internal Complaints Committee (ICC) vide its Board Meeting held on 11th February, 2015 under the chairmanship of Shri Bharatbhai Patel, Managing Director to redress complaints received regarding sexual harassment. Shri Nirmal Patel and Smt. Manjulaben Patel are the other members of the committee. 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. No. of complaints received. - NIL > No. of complaints disposed off - Not Applicable. STATEMENT ON DEVELOPMENT AND IMPLEMENTATION OF RISK MANAGEMENT POLICY There is a continuous process for identifying, evaluating and managing significant risks as faced through a risk management process designed to identify the key risks facing each business. The role of insurance and other measures used in managing risks is also reviewed. Risks would include significant weakening in demand from core-end markets, end market cyclicality, inflation certainties, energy cost and shortage of raw materials, maintenance and protection of leading technologies and adverse regulatory developments. During the year under review no major risks where noticed. RE-CONSTITUTION OF STAKEHOLDERS RELATIONSHIP COMMITTEE i.e. SHAREHOLDERS AND INVESTORS GRIEVANCE COMMITTEE : The Board has re-constituted the Shareholders and Investors Grievance Committee vide resolution passed in its Meeting held on 29/07/2011. According to Section 177, the company is required to constitute a Stakeholders Relationship Committee consisting of a Chairman who shall be a non executive director and such other members as may be decided by the Board. In view of the above provision, the company has altered the nomenclature of the Shareholders and Investors Grievance Committee to Stakeholders Relationship Committee. Further, the membership of the company has also changed in light of the above provisions. The Stake holders Relationship committee consists of Shri. Dharmendrabhai N. Patel, Chairman of the Committee/ Independent Director, Shri Bharatbhai P. Patel, Shri Dineshbhai P. Patel and Shri Nirmal B. Patel, as members of the committee. The powers (terms of reference) delegated to the committee are as under : (i) To scrutinize and take on records the shares / securities transfers and transmission of shares / securities etc. made by the Registrar and Transfer Agent of the Company and authorize the registration of transfers in the Register of Members as well as in the Register of Transfers of the Company and to take all other consequential and incidental actions and measures. (ii) To carry out redressal of Stakeholders' complaints like transfer of shares, non-receipt of declared dividends, non-receipts of balances sheet etc. (iii) To consider and resolve the grievances of the security holders of the company. (iv) To overseas the performance of the Registrar and Transfer Agents and recommends measures for over all improvement in the quality of investors / shareholders services. ACCOUNTING STANDARDS AND FINANCIAL REPORTING : The Company incorporates the accounting standards as and when issued by the Institute of Chartered Accountants of India. The Company complied with the Stock Exchange and legal requirement concerning the Financial Statements at the time of preparing them for the Annual Report. MANAGEMENT'S DISCUSSION AND ANALYSIS REPORT : Management's Discussion and Analysis Report for the year under review, as stipulated under Clause 49 of the Listing Agreement executed with the Stock Exchanges, is presented in a separate section forming part of the Annual Report. (Annexure - III) CORPORATE GOVERNANCE: As per the Circular No. CIR/CFD/POLICYCELL/7/2014 issued by SEBI on 09/09/2014, Clause 49 of Listing Agreement is not applicable to the companies having Paid up Share Capital not exceeding Rs. 10Crores and Net Worth not exceeding Rs. 25Crore, as on the last day of previous year. According to this circular your company is not mandatorily required to comply with the provisions of Clause 49, for the time being as the Paid up Share Capital of the company is not exceeding Rs. 10Crores and the Net Worth is not exceeding Rs. 25Crores, as on the last day of the previous year, however, the company has made all possible efforts to comply with the provisions of the revised Clause 49 of the Listing Agreement executed with the Stock Exchange(s) during the year under review. A separate section on Corporate Governance is included in the Annual Report (Annexure IV) and Certificate from Company's Auditors and from Practicing Company Secretary confirming the compliance with the code of Corporate Governance as enumerated in Clause-49 of the listing agreement with the Stock Exchange is annexed hereto. (Annexure -V) AUDITORS : Statutory Auditor : M/s. R.R.S & Associates, Chartered Accountants, Ahmedabad retire at the conclusion of this ensuing Annual General Meeting. The Company has received a certificate under Section 139(1) read with Section 141 of the Companies Act, 2013 to the effect that their re-appointment, if made will be in accordance to the specified limit. You are requested to consider their re appointment as Auditors of the Company for the Current Year. Auditors Report : The comments in the Auditors Report with Notes on Accounts referred to the Auditor's Report are self explanatory and, therefore do not call for any further explanation. Secretarial Auditor : The Board has considered the recommendation of Audit Committee regarding appointment and necessity of Secretarial Audit Report as mandate for every listed company in Section 204 of the Act, and has appointed M/s. Ashok P. Pathak & Co., Company Secretaries, Ahmedabad as Secretarial Auditor for the financial year 2015 -2016. Secretarial Audit Report : The Secretarial Audit Report for the financial year 2014-2015 is annexed herein and forming part of the Board Report (Annexure VI). The explanation on comments / observation(s) in the Secretarial Audit Report - The company has a small capital base medium size company situated in an industrial area of Chhatral Taluka Kalol. The company is putting all efforts to appoint a qualified company secretary and ensure to make the appointment during the current year in compliance with section 203 of the Companies Act, 2013 read with Rule 8 of the Companies (Appointment of Managerial Personnel) Rules, 2014. The company is in process of appointing Chief Financial Officer as a part of Key Managerial Personnel and ensure to make the appointment during the second quarter of the current year. Cost Audit : The Cost Auditor M/s. S A & Associates, Cost Accountants, Ahmedabad for the Financial Year ending on 31st March, 2014 (i.e. Financial Year 2013-2014) have conducted the audit of the Cost Records maintained by the Company under Section 233B (1) of the Companies Act, 1956 under revised procedure prescribed in general Circular No.15/2011 dated 11th April, 2011 read with Order No. 52/26/CAB-2010 dtd.24th January, 2012 issued by the Cost Audit Branch - CAB , Ministry of Corporate Affairs - MCA. The Company has filed the Cost Audit Report for the Financial Year ending on 31st March, 2014. As per sub- rule 2 of Rule 4 of the Companies (Cost Records and Audit) Amendment Rules, 2014 as Notified by the Ministry of Corporate Affairs on 31st December, 2014, the company is not required to get its cost records audited as the overall annual turnover of the company is below the prescribed threshold limit. EXTRACT OF ANNUAL RETURN : The details forming part of the extract of the Annual Return in form MGT 9 is annexed herewith. (Annexure VII) PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS The company has not made any Loans and investments, and have not given any guarantees or provided any securities covered under section 186 of the Companies Act, 2013. LISTING : The equity shares of the company are listed in the Bombay Stock Exchange Limited which has the connectivity in most of the cities across the country. DELISTING OF SHARES FROM AHMEDABAD STOCK EXCHANGE LIMITED The Board of Directors at its meeting held on 07th March, 2014 has decided to make an application for voluntarily delist Company's equity shares from the Ahmedabad Stock Exchange Limited to save the recurring costs without affecting the interest of the investors of the Company and without affecting the liquidity of equity shares of the Company. The Voluntary Delisting Application has been made to the Ahmedabad Stock Exchange on 23/04/2014 pursuant to the Clause 6(a) of SEBI (Delisting of Equity Shares) Regulations, 2009. The Equity Shares of the company were delisted from Ahmedabad Stock Exchange Limited w.e.f. 27.01.2015 in the meeting of Ahmedabad Stock Exchange Limited held on 23.01.2015 vide its letter No.509 dated 23.01.2015 DEMATERIALISATION OF EQUITY SHARES : As per direction of the SEBI and the Bombay Stock Exchange Limited, the shares of the Company are under compulsory demat form. The Company has established connectivity with both the Depositories i.e. National Securities Depository Limited [NSDL] and Central Depository Services India Limited [CDSL] and the demat activation number allotted to the Company is ISIN : INE52C01010. Consequent to sub-division of equity shares of Rs.10 each into the equity shares of Rs. 1 each, the new ISIN allotted to the Company is ISIN : INE952C01028. Presently shares are held in electronic and physical mode (96.85% of shares in demat, 3.15% in physical mode.) INSURANCE : The company has made necessary arrangements for adequately insuring its insurable interests. INDUSTRIAL RELATIONS : The directors are happy to note that the industrial relations continued to remain cordial during the year. The directors express their appreciation towards the workers, staffs and executive staffs for their coordination and hope for a continued harmonious relations. VISION : To be the India's best integrated textile solutions enterprise with leadership position across products and markets, exceeding costumers and shareholder expectation. OUR MISSION : > Offerinnovative, customized and value added services to our customers > Actively explore potential markets and products > Optimize use of all resources > Maximize people development initiatives > Beaknowledge leader and an innovator in our businesses > Exceed compliances and global quality standards > Beanethical, transparent and responsible global organization DIRECTORS' RESPONSIBILITY STATEMENT : Pursuant to the requirement under Section 134(3)(c) read with Section 134(5) of the Companies Act,2013 with respect to Director's Responsibilities Statement, it is hereby confirmed : (i) that in the preparation of the Annual Financial Statement for the Financial Year ended 31st March, 2015, the applicable accounting standards had been followed along with proper explanation relating to material departures; if any; (ii) that the Director had 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 Financial Year and of the Profit or Loss of the Company for the year under review; (iii) that the Directors had 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) that the Directors had prepared the accounts for the Financial Year ended 31st March, 2015, on a going concern basis. (v) that the internal financial controls laid down by the company are adequate and were operating effectively. (vi) that the directors had devised proper systems to ensure compliances with the provisions of all applicable laws and that such system were adequate and operating effectively. CODE OF INDEPENDENT DIRECTORS - SCHEDULE IV : The Board has considered Code of Independent Directors as prescribed in Schedule IV of the Companies Act, 2013. The code is a guide to professional conduct for independent directors adherence to these standards by independent directors and fulfillment of their responsibility in a professional and faithful manner will promote confidence of the investment community and regulators. The broad items for code for independent directors are : (i) Guidelines for Professional conduct. (ii) Role and Functions. (iii) Duties (iv) Manner and process of appointment. (v) Re-appointment on the basis of report of performance evaluation. (vi) Resignation or Removal. (vii) Atleast one Separate meeting of Independent Directors in a year without attendance of non independent directors or members of management. (viii) Evaluation mechanism of Independent Directors by entire Board of Directors. RELATED PARTY TRANSACTIONS : The company has not entered into any contract / agreement with Related Parties and have no transactions with Related Parties during the year under review. There are no materially significant related party transactions i.e. transactions of material nature, with promoters, the directors or the management, their subsidiaries or relatives etc., that may have potential conflicts with the interests of the company at large in the financial year 2014-2015. However, the Board has taken note of the provisions of Section 188 of the Companies Act, 2013 read with Rule 15 of the Companies (Meetings of Board & its Powers) Rules, 2014 and revised clause 49 of the listing agreement, relating to the Related Party Transactions. ACKNOWLEDGMENT : Your directors record their sincere appreciation of the dedication and commitment of all employees in achieving and sustaining excellence in all areas of the business. Your Directors thanks the shareholders, customers, suppliers and bankers and other stakeholders for their continued co-operation and support. On Behalf of the Board For, Minaxi Textiles Ltd. Dineshbhai P. Patel Chairperson DIN : 02268757 Bharatbhai P. PatelManaging Director DIN : 00161825 Date : 07/05/2015 Regd. Office : Plot No. 3311, GIDC Industrial Estate, Village Chhatral, Phase-IV,Taluka Kalol,Dist. Gandhinagar(N.G)Gujarat |