DIRECTORS REPORT TO MEMBERS Your Directors have great pleasure in presenting the 30th Annual Report along with the Audited Statement of Accounts for the year ended 31st March, 2015. OPERATIONAL REVIEW & STATE OF COMPANY'S AFFAIRS : a) Fertilizer Division :- The Company has produced 38287.000 M.T. SSP during the year and sold 33223.000 M.T. SSP during the year ended 31s' March, 2015. The realization from Fertilisers was low as market flooded with inventories by suppliers. The Company organized Dealers Conference to boost marketing of Fertilisers and has planned production and sale of 75,000 MT SSP Fertiliser during 2015-2016. However this could be improved depending upon favourable monsoon during the current year. b) Realty Division :- The Company has started construction of Phase II project with one Tower i.e. '"F1 wing- OXFORD"& work is completed up to 80% including finishing work. The balance work will be positively completed in next 6 months. TDR Policy was not announced by State Government hence the company had to purchase TDR with approval of authorities concerned. The 'F' Tower work is in progress & Phase II Towers G/H/I will be completed in next 3/4 years. The Company has started developing its surplus land for construction of ANCHAV1YO Boutique Resort for Guests, Corporates, Banks & Business House for Spiritual, Cultural programs on commercial basis. c) Agriculture Division:- The Scope for Agricultural Division being limited and as such the company has shifted to land development for more remunerative use. DIVIDEND: Your Board is pleased to recommend for approval of the Members, at its 30th Annual General Meeting payment of Dividend of Rs. 1.50 paise (15%) per Equity Share for the financial year ended 31" March, 2015. If approved at the forthcoming Annual General Meeting, it will result in an outflow of Rs. 79.28 Lacs to the Members of the Company, coupled with Rs. 15.85 Lacs as dividend distribution tax. RESERVES: Your Directors propose to transfer Rs 93.96 lacs to the General Reserve Account. An amount of Rs 5989.19 lacs is proposed to be retained in the Statement of Profit & Loss. SHARE CAPITAL OF THE COMPANY: The Paid up Equity Share Capital, as at 31st March, 2015 was Rs. 5,28,55,110/- divided into 52,85,511 Equity shares, having face value of 10/- each fully paid up. During the year under review, the Company has not issued any shares nor granted any stock options nor sweat equity. SUBSIDIARIES, ASSOCIATE COMPANIES & JOINT VENTURES: The Company does not have any subsidiary, associate companies & joint ventures. CORPORATE SOCIAL RESPONSIBILITY INITIATIVES: During the year the Company has constituted a "Corporate Social Responsibility" (CSR) Committee. As part of its initiatives under CSR, the company has contributed funds for activities like distributing books, educational material, holding seminars for educational purpose, arranged food for needy children and also arranged for various development activities benefiting children. The contributions in this regard have been made to the registered trust which is undertaking these activities. The Annual Report on CSR activities is annexed herewith as: Annexure 'A'. INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY: The Company has an Internal Control System, commensurate with the size, scale and complexity of its operations. The scope and authority of the Internal Audit function is defined by the Audit Committee. To maintain its objectivity and independence, the Internal Audit function reports to the Chairman of the Audit Committee of the Board & to the Chairman & Managing Director of the Company. The Internal Audit Department monitors and evaluates the efficacy and adequacy of internal control system in the Company, its compliance with operating systems, accounting procedures and policies of the Company. Based on the report of internal audit function, the Company undertakes corrective action in their respective areas and thereby strengthen the controls. Significant audit observations and recommendations along with corrective actions thereon are presented to the Audit Committee of the Board. CORPORATE GOVERANANCE AND MANAGEMENT DISCUSSION & ANALYSIS REPORTS: The Company adheres to the requirements set out by the Securities and Exchange Board of India's Corporate Governance practices and have implemented all the stipulations prescribed. The Company has implemented several best corporate governance practices. The Corporate Governance and Management Discussion & Analysis Report, which form an integral part of this Report, are set out as separate Annexures, together with the Certificate from the Auditors of the Company regarding compliance with the requirements of Corporate Governance as stipulated in Clause 49 of the Listing Agreement. RELATED PARTY TRANSACTIONS: The details of related party disclosure and transactions as prescribed in Form AOC-2 are given in the Note No. 38 of Notes on Financial Statements. All the transactions are done at arm's length and pertain to FY 2014-15 period only and as approved by Board of Directors on recommendation of Audit Committee. The disclosure in Form AOC-2 is given as per Annexure 'B'. Further, there are no materially significant related party transactions made by the company with Promoters, Key Managerial Personnel or other designated persons which may have potential conflict with interest of the company at large. All related party transactions are placed before the Audit Committee and also before the Board for their approval in accordance with the Policy on Related Party Transactions formulated by the Board of Directors of the Company and has been posted on the website of the Company. DIRECTORS AND KEY MANAGERIAL PERSONNEL: Number of meetings of the board of directors: The details of the number of meetings of the Board held during the Financial Year 2014-15 forms a part of the Corporate Governance Report. Directors: In accordance with the provisions of Section 152 of the Companies Act, 2013 and the Articles of Association of the Company, Shri K. N. Jethwa, Whole Time Director retires by rotation and being eligible offers himself for re-appointment. Statement on declaration given by Independent Directors: The Independent Directors have submitted the declaration of independence, as required pursuant section 149(7) of the Companies Act, 2013 stating that they meet the criteria of independence provided in sub- section(6). Board evaluation: Pursuant to the provisions of the Companies Act, 2013 and Clause 49 of the Listing Agreement, the Board has carried out an evaluation after taking into consideration various aspects of the Board's functioning, composition of the Board and its Committees, culture, execution and performance of specific duties, remuneration, obligations and governance. The performance evaluation of the Independent Directors was completed. The performance evaluation of the Chairman and the Non-independent Directors was carried out by the Independent Directors. The Board of Directors expressed their satisfaction with the evaluation process. Appointment of KMP: The Board of Directors had on the recommendation of the Nomination and Remuneration committee appointed Mrs. Vidya Pradeep Gidde as CFO effective from 12"' March, 2015. During the year under review, the Company has designated the following persons as the Key Managerial Personnel. DIRECTORS' RESPONSIBILITY STATEMENT: To the best of their knowledge and belief and according to the information and explanations obtained by them, your Directors make the following statements in terms of Section 134 of the Companies Act, 2013: a) in the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures, if any; b) the Directors had selected such accounting policies and applied them consistently and made judgements 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; e) 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; 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. AUDITORS AND AUDITOR'S REPORT: Statutory Auditor: M/s. Desai Saksena & Associates, Chartered Accountants, (Firm Registration No.l02358W) were appointed as the Statutory Auditors of the Company at the AGM held on 11th September, 2014 to hold office till the conclusion of the fourth consecutive AGM, are recommended for ratification of appointment for the financial year 2015 -2016. As required under the provisions of section 139 & 142 of the Companies Act, 2013, the Company has obtained written confirmation from M/ s Desai Saksena & Associates that their appointment, if made, would be in conformity with the limits specified in said Section. Secretarial Audit: Pursuant to provisions of Section 204 of the Companies Act, 2013 and the Rules mad&thereunder, the company has appointed M/s. GMJ & Associates, a firm of Company Secretaries in Practice to undertake the Secretarial Audit of the Company. The Secretarial Audit Report is annexed herewith as Annexure 'C and forms an integral part to this Report. Cost Audit: As per the requirement of the Central Government and pursuant to Section 148 of the Companies Act, 2013 read with the Companies (Cost Records and Audit) Rules, 2014 as amended from time to time, your company has been carrying out audit of the cost records. The Board of Directors, on the recommendation of the Audit Committee, has appointed M/s. S R Singh & Co., Cost Accountants as the Cost Auditors to conduct the audit of the cost records of the Company for the Financial Year 2015-16 at a remuneration of Rs. 75,000/- p.a. plus service tax as applicable and out of pocket expenses. As required under the Companies Act, 2013, a resolution seeking member's approval for remuneration payable to the Cost Auditor forms part of the Notice convening the Annual General Meeting. Auditor's observations: There were no audit qualifications in the Statutory Auditors report as well as the Secretarial audit Report for the financial year 2014-2015 as annexed to this Annual Report. DISCLOSURE: Audit Committee: In accordance with the provisions of the Listing Agreement and Corporate Governance, the Company has constituted an Audit Committee comprising of 2 Independent Directors & 1 Executive Director. The Audit Committee acts in accordance with the terms of reference specified from time to time by the Board. The details of the terms of Audit Committee and other details are explained in the Corporate Governance Report. Nomination & Remuneration Committee & its Policy: The Board of Directors has framed a policy which lays down a framework in relation to remuneration of Directors, Key Managerial Personnel and Senior Management of the Company. The policy lays down the criteria for selection and appointment of Board Members. The details of the policy are explained in the Corporate Governance Report. Risk Management Policy: During the year, your Directors have constituted a Risk Management Committee which has been entrusted with the responsibility to assist the Board (a) to ensure that all the current and future material risk exposures of the Company are identified, assessed, quantified, appropriately mitigated, minimized and managed i.e. to ensure adequate systems for risk management (b) to establish a framework for the company's risk management process and to ensure its implementation (c) to enable compliance with appropriate regulations, wherever applicable, through the adoption of best practices and (d) to assure business growth with financial stability. A Risk Management Policy was reviewed and approved by the Committee. Vigil Mechanism/Whistle Blower Policy: The Company has a Vigil Mechanism / Whistle Blower policy to report genuine concerns, grievances, frauds and mismanagements, if any. The Vigil Mechanism / Whistle Blower policy has been posted on the website of the Company. Particulars of Loans, Guarantees or Investments: During the year there is no loan given, investment made, guarantee given or security provided by the Company to any entity covered under Section 186 of Companies Act, 2013. Extract of Annual Return: The details forming part of the extract of the Annual Return in form MGT-9, as required under Section 92 of the Companies Act, 2013, is included in this Report as Annexure 'D' and forms an integral part of this Report. Particulars regarding Conservation of Energy, Technology Absorption and Foreign Exchange earning and outgo: The information on conservation of energy, technology absorption and foreign exchange earnings and outgo pursuant to Section 134(3)(m) of the Companies Act, 2013, read with the Rule 8(3) of the Companies (Accounts) Rules, 2014 is given in Annexure 'E' to this Report. Particulars of Employees: No employee was in receipt of remuneration exceeding the limits as prescribed under the provisions of Section 197 of the Companies Act, 2013 and read with rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 hence no such particulars are furnished GENERAL DISCLOSURES: Deposits: The Deposits accepted by the Company have been repaid before 31" March, 2015 and no fresh deposits are accepted during the within the meaning of Section 73 of the Companies Act, 2013 and the Companies (Acceptance of Deposits) Rules, 2014. Significant and material orders passed by the Regulators or Courts: There are no significant and material orders passed by the Regulators or Courts that would impact the going status of the Company and its future operations. Depository Services: The Company's Equity Shares have been admitted to the depository mechanism of the National Securities Depository Limited (NSDL) and also the Central Depository Services (India) Limited (CDSL). As a result the investors have an option to hold the shares of the Company in a dematerialized form in either of the two Depositories. The Company has been allotted ISIN No. INE842D01011. Shareholders therefore are requested to take full benefit of the same and lodge their holdings with Depository Participants [DPs] with whom they have their Demat Accounts for getting their holdings in electronic form. Code of Conduct: Your Company is committed to conducting its business in accordance with the applicable laws, rules and regulations and highest standards of business ethics. In recognition thereof, the Board of Directors has implemented a Code of Conduct for adherence by the Directors, Senior Management Personnel and Employees of the Company. This will help in dealing with ethical issues and also foster a culture of accountability and integrity. The Code has been posted on the Company's website www.bharatrealty.co.in All the Board Members and Senior Management Personnel have confirmed compliance with the Code. Sexual Harassment: The Company has constituted an Internal Complaint Committee as required under Section 4 of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the Rules made thereunder. During the year under review, no complaints were reported. Safety, Environment control and Protection: The Company is aware of the importance of environmentally clean and safe operations. The Company's policy requires conduct of operations in such a manner, so as to ensure safety of all concerned, compliances, environmental regulations and preservation of natural resources at the Plant. Listing: The Company's Shares are listed on BSE Limited, Mumbai. ACKNOWLEDGEMENTS: Your Directors wish to place on record their sincere appreciation to the Central Government, State Government, Thane Municipal Corporation, Agricultural Department, Company's Banker, Shareholders, Customers and business consultants for their valued co-operation and support at all times. Your Directors also wish to place on record their appreciation for impressive growth achieved through the competence, hard work, solidarity, cooperation and support of employees at all levels. For and on behalf of the Board Sd/- (YOGENDRA D. PATEL) CHAIRMAN & MG. DIRECTOR DIN:-00106864 Place : Mumbai-400 023. Date: 28* May, 2015 Registered Office Bharat Fertiliser House, 12, Nanabhai Lane, Fort, |