| Dear Members,
Your Directors have pleasure in presenting their 22nd Annual report on
the affairs of the Company together with the Audited Statement of
Accounts for the year ended on 31st March, 2015 Financial Performance:
A summary of company's financial performance for 2014-2015:
( Rs in Lakhs)
Particulars Year Ended Year Ended
31.03.2015 31.03.2014
Sales for the year 65.13 4396.83
Profit before Interest& finance
charges, depreciation & taxation 12.52 (68.91)
Less: Interest & finance Charges 0.15 0.61
Operating profit before
depreciation & taxation 12.37 (69.52)
Less: Depreciation, amortization
& impairment of asset 12.17 9.43
Profit before Exceptional Items 0.20 (78.95)
Add: Exceptional Items 0.00 0.00
Profit before taxation 0.20 (78.95)
Current Tax & Prior Year 0.00 0.00
Deferred Tax Liability (3.79) 43.92
Profit after taxation (3.59) (35.03)
Add: Balance brought forward 3,957.35 3,992.38
Profit available for appropriation 3,953.76 3,957.35
Less: Appropriation:
Transfer to General Reserve 0.00 0.00
Interim Dividend 0.00 0.00
Tax on Interim Dividend 0.00 0.00
Proposed Dividend 0.00 0.00
Provision for Tax on Proposed Dividend 0.00 0.00
Balance carried forward to Balance Sheet 3,953.76 3,957.35
Operating & Financial Performance. Internal Control:
Your company has generated gross income of Rs. 347.72 Lacs as compared
to Rs. 4789.54 lacs for previous year. The income by way of trading
during the year amounted to Rs.65.13 lacs compared to Rs. 4323.65 in
the previous year. Income from services amounted to Rs. Nil compared to
Rs. 73.18 Lacs in the previous year.
The Company has in place an established internal control system
designed to ensure proper recording of financial and operational
information and compliance with various internal controls and other
regulatory and statutory compliances. Code of Internal controls which
require that the Director review the effectiveness of internal controls
and compliances controls, financial and operational risks, risk
assessment and management systems and related party transactions, have
been complied with.
Company's Policies on Remuneration, Whistle Blower and also Code of
Conduct applicable to Directors and Employees of the Company has been
complied with. These Policies and Code of Conduct are available on the
Company's website www.laffanspetrochemical.com
There is no change in the nature of the business of the Company. There
were no companies which became or ceased to be the Subsidiaries, joint
ventures or associate companies during the year. There were no
significant and material orders passed by the regulators or courts or
tribunals impacting the going concern status and company's operations
in future. There were no material changes and commitment affecting the
financial position between March 31, 2015 and date of this Report of
Directors.
Deposits:
The Company has not invited/ accepted any deposits from the public
during the year ended March 31,2015. There were no unclaimed or unpaid
deposits as on March 31, 2015.
Transfer to Reserve:
The Company has not transferred any amount to reserves.
Dividend:
Due to net loss of Rs. 3.59 Lacs, it would not be possible to recommend
any dividend for declaration. Your Directors regret their inability to
recommend any Dividend for the year under review.
SIGNIFICANCE AND MATERIAL ORDER PASSED BY THE REGULATORS OR COURTS OR
TRIBUNALS.
There were no significance and material orders passed by regulators or
courts or tribunals impacting the going concern status and company
operations in future. There were 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.
SUBSIDIARIES, JOINT VENTURE OR ASSOCIATES COMPANIES DURING THE YEAR:
The Company has no subsidiaries, joint ventures or associated companies
therefore disclosures in this regards are not provided in this report.
Number of meeting of the Board:
During the year 2014-15, the Board of Directors met seven times viz. on
2nd May, 2014; 29th May, 2014; 1st July, 2014; 12th August, 2014; 14th
November, 2014; 14th February, 2015 and 10th March, 2015.
The details relating to Audit Committee Meetings has been set out in
the Corporate Governance Report annexed with this report which forms
part of this report.
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 statement in terms of Sections 134(3) (c) read section 134(5)
of the Companies Act, 2013 of the Companies Act, 2013:
(i) in the preparation of the annual accounts for the financial year
ended 31st March, 2015, the applicable accounting standards had been
followed along with proper explanation relating to material departures;
(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 as at March 31, 2015 and of the profit and loss of the
company for that period;
(iii) 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) the directors had prepared the annual accounts on a going concern
basis; and
(v) 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.
(vi) 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.
D. Statement on declaration given by independent directors under
sub-section (6) of section 149:
All Independent Directors have given declarations that they meet the
criteria of independent as laid down under Section 149(6) of the
Companies Act, 2013 and Clause 49 of the Listing agreement.
Company's policy on directors' appointment and remuneration including
criteria for determining qualifications, positive attributes,
independence of a director and other matters provided under sub-section
(3) of section 178:
The Policy of the Company on Directors' appointment and remuneration
including criteria for determining qualifications, positive attributes,
independence of a Director and other matters provided under sub-section
(3) of section 178, is appended as Annexure A to this Report.
Particulars of loans, guarantees or investments under section 186:
Details of Loans, Guarantees and Investments covered under the
provisions of Section 186 of the Companies Act, 2013 are given in the
notes to the Financial Statements.
RELATED PARTY TRANSACTIONS:
Particulars of contracts or arrangements with related parties referred
to in sub-section (1) of section 188 in the form AOC-2:
All the contracts/ arrangements/ transactions that were entered into by
the Company during the financial year with related parties were on an
arm's length basis and in the ordinary course of business. During the
year, the Company had not entered into any contract/ arrangement/
transaction with related parties which could be considered material in
accordance with the policy of the Company on materiality of related
party transaction. All Related Party Transactions are placed before the
Audit Committee for approval.
The policy on Related Party Transactions as approved by the Board is
uploaded on the Company's website www. laffanspetrochemical.com .
Pursuant to clause (h) of sub-section (3) of section 134 of the Act and
Rule 8(2) of the Companies (Accounts) Rules, 2014:
1. Details of contracts or arrangements or transactions not at arm's
length basis: Nil
2. Details of material contracts or arrangement or transactions at
arm's length basis:
a) Name of the related party and nature of relationship: Mr. Sandeep
Seth, Managing Director
b) Nature of transaction: Payment for Office Rent b) Duration of
transaction: Not Applicable
d) Salient terms of transaction: Monthly Rent of Rs. 2,00,000/- per
month
e) Date of Approval by Board, if any: Not Applicable
f) Amount paid as advances, if any: Nil
Conservation of energy, technology absorption, foreign exchange
earnings and outgo:
The information on conservation of energy, technology absorption and
foreign exchange earnings and outgo stipulated under Section 134(3)(m)
of the Companies Act, 2013 read with Rule, 8 of The Companies
(Accounts) Rules, 2014, is annexed herewith as "Annexure B".
Risk management policy and its implementation:
The Company has in place a mechanism to identify, assess, monitor and
mitigate various risks to key business objectives. Major risks
identified by the businesses and functions are systematically addressed
through mitigating actions on a continuing basis. These are discussed
at the meetings of the Audit Committee and the Board of Directors of
the Company.
The Company's internal control systems are commensurate with the nature
of its business and the size and complexity of its operations. These
are routinely tested and certified by Statutory as well as Internal
Auditors.
Corporate Social Responsibility:
The Company is not required to constitute a Corporate Social
Responsibility Committee as it does not fall within purview of Section
135(1) of the Companies Act, 2013 and hence it is not required to
formulate policy on corporate social responsibility.
Statement indicating the manner in which formal annual evaluation has
been made by the Board of its own performance and that of its
committees and Individual Directors:
The formal annual evaluation has been done by the board of its own
performance and that of its committee and individual directors on the
basis of evaluation criteria specified in the Nomination and
Remuneration policy of the Company. A member of the Board/committee did
not participate in the discussion of his/her evaluation.
Directors or key managerial personnel who were appointed or have
resigned during the financial year 2014-15:
The Board of Directors had appointed Mrs. Anisha Seth (DIN: 06867960)
as a woman director from 2nd May, 2014 and Whole-time Director with
effect from 1st July, 2014 and the same was approved by the members in
the twenty first Annual General Meeting held on September 26, 2014. She
will hold Office for 5 years with effect from 1st July, 2014 as
approved by the members in the 21st Annual General Meeting.
The Board also appointed Mr. Naresh Chhabria (DIN: 03463187) as an
Independent Director with effect from 2nd May, 2014 and the same was
approved by the members in the twenty first Annual General Meeting held
on September 26, 2014. Mr. Naresh Chhabria (DIN: 03463187) will hold
office till 31st March, 2019.
Mr. Rajesh Sharma ceased to be associated with the Company on account
of vacation of office under section 167 of the Companies Act, 2013. Mr.
Rajesh Thadani (DIN 00009889) was appointed as an Additional Director
with effect from 14th November, 2014. Board hereby recommends
appointing Mr. Rajesh Thadani as Independent Director at the ensuing
Annual General Meeting of the Company.
During the year Company had also appointed Mr. Mahalinga B. Kotian as a
Chief Financial Officer of the Company w.e.f. 10th March, 2015. During
the year Company accepted resignation of Mr. Ambalal C. Patel from the
post of Independent Director w.e.f. 1st July, 2014.
Re-appointments
As per the provisions of the Companies Act, 2013 and the Articles of
Association of the company, Mrs. Anisha Seth (DIN 06867960) will retire
in the ensuing Annual General Meeting and being eligible, seek
re-appointment. The Board of Directors recommends his re-appointment.
AUDITORS
At the Annual General Meeting held on 26th September, 2014 M/s. S. M.
Kapoor & Co., Chartered Accountants, Statutory Auditors of the Company
having registration number FRN No. 104809W were appointed as statutory
auditors of the Company to hold office till the conclusion of the
Annual General Meeting to be held in the calendar year 2017. In terms
of first proviso of section 139 of the Companies Act, 2013, the
appointment of the auditors shall be placed for ratification by members
at every annual general meeting. The Company has received a certificate
from the statutory auditors to the effect that their re-appointment, if
made, would be within the limits prescribed.
There are no qualifications, reservations or adverse remarks or
disclaimers made by M/s. S. M. Kapoor & Co., Statutory Auditors, in
their report.
Internal Auditors
M/s Govind Prasad & Co, Chartered Accountants were appointed as an
Internal Auditor with effect from 14th February, 2015, they performs
the duties of internal auditors of the company and their report is
reviewed by the audit committee from time to time.
OBLIGATION OF COMPANY UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE
(PREVENTION. PROHIBITION AND REDRESSAL) ACT, 2013:
In order to prevent sexual harassment of women at work place the
Company has adopted a policy for prevention of Sexual Harassment of
Women at workplace and has set up Committee for implementation of said
policy under the Sexual Harassment of Women at Workplace (Prevention,
Prohibition and Redressal) Act, 2013 and during the year Company has
not received any complaint of such harassment.
The Extract of the Annual Return in form MGT-9:
The details forming part of the extract of the Annual Return in form
MGT 9 is annexed herewith as "Annexure C".
PARTICULARS OF INVESTMENTS HELD BY THE COMPANY UNDER SECTION 186
WITH DETAILS:
The company has not given any loans or guarantees covered under the
provisions of section 186 of the Companies Act, 2013.
TRANSFER OF AMOUNTS TO INVESTOR EDUCATION AND PROTECTION FUND
Your Company did not have any funds lying unpaid or unclaimed for a
period of seven years. Therefore there were no funds which were
required to be transferred to Investor Education and Protection Fund
(IEPF).
BOARD EVALUATION
Pursuant to the provisions of the Companies Act, 2013, the Board has
carried out an evaluation of every director's performance was carried
out. An evaluation sheet was given to each director wherein certain
criteria were set out for which ratings are to be given.
RESEARCH & DEVELOPMENT:
As Company is not into manufacturing activity, there was no Research
and Development activity carried out by the Company during the
financial year under review.
WEBSITE OF THE COMPANY:
The Company maintains a website www.laffanspetrochemical.com where
detailed information of the company and its products are provided
CODE OF CONDUCT:
The Board of Directors has approved a Code of Conduct which is
applicable to the Members of the Board and all employees in the course
of day to day business operations of the company. The Code has been
placed on the Company's website www.laffanspetrochemical.com. The Code
lays down the standard procedure of business conduct which is expected
to be followed by the Directors and the designated employees in their
business dealings and in particular on matters relating to integrity in
the work place, in business practices and in dealing with stakeholders.
All the Board Members and the Senior Management personnel have
confirmed compliance with the Code.
Disclosure pursuant to Section 197(12) of the Companies Act, 2013 read
with rule 5 of the Companies (Appointment and Remuneration of
Managerial Personnel) Rules, 2014.
Requirements of Rule 5(1) Details
(i) the ratio of the remuneration Mr, Sandeep Seth - 9.74 :
of each director to the median 1 (974%)
remuneration of the employees
of the company for the Mr. Jaideep Seth - 3.08 :
finantial year; 1 ( 308.44%)
Mr, Rajesh Sharma - 0 : 1
( Nil %)
Mr, Naresh Chhabria - 0 :
1 ( Nil %)'
Mrs. Anisha Seth - 3.71:
1 ( 340.91%)
Mr. Rajesh Thadani - 0 :
1 ( Nil%)
(ii) the percentage increase Mr, Sandeep Seth -
in remuneration of each No increase
director, Chief Financial
Officer, Chief Executive Mr. Jaideep Seth -
Officer, Company Secretary No increase
or Manager, if any,in
the financial year; Mr Rajesh Sharma -
No increase
Mr, Naresh Chhabria -
No increase
Mrs. Anisha Seth -
No increase
Mr. Mahalinga B. Kotian
(CFO)- No increase
Mr, S. R. Narayanan (CS)
- No increase
Mr, Rajesh Thadani -
0 : 1 ( Nil%)
iii) the percentage increase No increase
in the median remuneration
of employees in the financial
year;
(iv) the number of permanent 6 employees as on 31st
employees on the rolls of company; March, 2015
(v) the explanation on the Average increase in remuneration
relationship between average of all employees was Nil %
increase in remuneration and for the year 2015 which is
company performance; based on the individual's
employee's performance. The
total sales in the year reduced
by 98.49% over previous year,
(vi) comparison of the Average increase in remuneration
remuneration of the Key of all employees was Nil %
Managerial Personnel against for the year 2015.
the performance of the company;
(vii) variations in the market As on
capitalisation of the company, 31.03.2014
price earnings ratio as at the
closing date of the current BSE 8.30
financial year Store Price Vadodara Not Traded
and previous financial year Stk Ex Not Traded
and percentage increase DelhiStk Ex Not Traded
over decrease in the market
quotations of the shares of As on % increase
the company in comparison to 31.03.2015
the rate at which the company
came out with the last public BSE 9.25 11.45%
offer Vadodara Not Traded Not Traded
Stk Ex Not Traded Not Traded
DelhiStk Not Traded Not Traded
Ex
The Company has not made any
public issue or right issue of the
securities in the last 15 years,
so comparison have not been made
of current share price with public
offer price.
The Company's shares are listed on
Bombay, Vododara and Delhi
Stock Exchanges.
(viii) average percentile No increase in Salaries of
increase already made in the Employees during the Financial
salaries of employees other Year 2014-15.
than the managerial personnel
in the last financial year
and its comparison with the
percentile increase in the
managerial remuneration
and justification thereof
and point out if there are
any exceptional circumstances
for increase in the managerial
remuneration;
(ix) comparison of the each The remuneration of Key
remuneration of the Key Managerial Personnel has
Managerial Personnel against not been increased in
the performance of the company; 2014-15, compared to 2013-14,
whereas the Net loss during
the 2014-15 reduced
substantially compared
to 2013-14.
(x) the key parameters for There is no variable component
any variable component of of remuneration availed by any
remuneration availed by the of the directors.
directors;
(xi) the ratio of the The Managing Director is the
remuneration of the highest highest paid Director.
paid director to that of the No employee received
employees who are not directors remuneration higher than
but receive remuneration in the Managing Director
excess of the highest paid
director during the year; and
(xii) affirmation that the Remuneration paid during the
remuneration is as per the year ended March 31, 2015 is
remuneration policy of the as per Remuneration policy
company. of the Company
* Mr. Rajesh Sharma ceased to be associated with the Company w.e.f.
10th March, 2015
** Mr. Rajesh Thadani has been appointed as an Additional Director
w.e.f 14th November, 2014
None of the employee has received remuneration exceeding the limit as
stated in rule 5(2) of the Companies (Appointment and Remuneration of
Managerial Personnel) Rules, 2014
Secretarial Audit
As required under section 204 (1) of the Companies Act, 2013 the
Company has obtained a secretarial audit report from M/s. Ragini
Chokshi & Co., Company Secretaries in Practice which is annexed
herewith as "Annexure D..
Certain observations made in the report with regard to non filing of
some forms were mainly due to ambiguity and uncertainty of the
applicability of the same for the relevant period. However, the company
would ensure in future that all the provisions are complied with the
fullest extent. Regarding observation relating to taking on records the
disclosure of interest given by all the directors in second Board
Meeting instead of first Board Meeting of the financial year, the same
happened because in the first Board Meeting 2 new directors were
appointed and they also gave their disclosures in that Board Meeting,
therefore it was decided to take on record disclosure of interest
received from all the directors in next Board Meeting.
With respect to the observation relating to Clause 41 of the Listing
Agreement, it is hereby clarified that the intimation of Board Meetings
were published in newspaper but Company has not kept Newspaper cuttings
in its records which will be taken care henceforth.
Vigil mechanism/whistle Blower Policy:
The Company has established a vigil mechanism/Whistle Blower Policy for
Directors and employees to report their genuine concerns, details of
which have been given in the Corporate Governance Report annexed to
this Report.
Following details are also available on the website of the Company
i.e on www.laffanspetrochemical.com
1. The details of such familiarisation programmes
2. The policy on Related Party Transactions
3. Code of conduct for Board of Directors and Employees
4. Code of internal procedure and conduct under insider trading
regulation.
5. Policy on Board Diversity
6. Nomination & Remuneration Policy etc.
Management Discussion and Analysis Report:
In terms of the provisions of Clause 49 of the Listing Agreement, the
Management's discussion and analysis is set out in this Annual Report.
CAUSIONARY STATEMENT
The statements contained in the Board's Report and Management
Discussion and Analysis contain certain statements relating to the
future and therefore are forward looking within the meaning of
applicable securities, laws and regulations. Various factors such as
economic conditions, changes in government regulations, tax, regime,
other statues, market forces and other associated and individual
factors mar however lead to variation in actual results. Readers are
cautioned not to place undue reliance on the forward looking
statements.
Report on Corporate Governance
A separate report on Corporate Governance is attached to this report
along with Statutory Auditor's certificate on its compliance.
Acknowledgments
Your Directors take this opportunity to place on record their
appreciation and sincere gratitude to the Government of India,
Governments of Gujarat & Maharashtra, Authorities and the Bankers to
the Company for their valuable support and look forward to their
continued co-operation in the years to come.
Your Directors acknowledge the support and co-operation received from
the employees and all those who have helped in the day to day
management.
For and on behalf of the Board of Directors
Sandeep Seth Jaideep Seth
Place: Mumbai Managing Director Director
Dated: May 29, 2015 (DIN 00316075) (DIN 03130620)
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