| Dear Members,
The Directors have pleasure in presenting the Twenty Ninth Report of
your Company along with the Audited Statement of Accounts for the year
ended 31st March, 2015.
FINANCIAL RESULTS (Rs. in Lacs)
The financial performance of the Company for the financial year ended
on 31st March, 2015 and 31st March, 2014 are summarized below:-
Particulars 31.03.2015 31.03.2014
Total Income 1795.87 1701.16
Operating profit before interest
and depreciation 192.07 89.33
Interest 54.83 55.72
Depreciation 50.02 24.69
Profit before Tax (PBT) 87.22 8.92
Provision for Taxation 16.92 6.07
Security Transaction Tax 0.09 0.06
Deferred Tax Liabilities -8.14 2.04
Minimum Alternate Tax Credit Availed -2.14 -0.84
Profit after Tax (PAT) 80.49 1.59
Balance Brought Forward 55.71 74.12
Profit available for appropriation 136.20 75.71
Transfer to General Reserve 20.00 20.00
Balance carried to Balance Sheet 116.20 55.71
STATEMENT OF COMPANY'S AFFAIRS AND FUTURE OUTLOOK
During the year under review, the total income of your Company
increased to Rs. 1795.87 lakhs from Rs. 1701.16 lakhs as compared to
previous year. The said total income includes an additional
contribution of turnover from new venture of handling services
division of the Company of Rs. 174.11 lakhs during the year. During
the year, the net profit before interest and tax from steel
manufacturing division decreased to Rs. 26.22 lakhs from Rs. 43.18
lakhs as compared from the previous year. However during the year, the
new venture of handling services business had contributed an
additional net profit before interest and tax of Rs. 84.27 lakhs. The
other income comprising the return from investments activities has
registered a net profit before interest and tax of Rs. 70.32 lakhs as
compared to Rs. 22.57 lakhs in the previous year.
The Management System of your Company is in compliance with the
requirement of international quality standard ISO 9001 : 2008 and it
has been duly certified by the JAS-ANZ, an International Certification
Agency.
Your Directors has explored the handling services business and
foresees the activities as profitable venture for future year business
of the Company. Your directors are hopeful to record growth in the
profitability by earning from handling services business as well as
proper savings on account of overhead expenses in the current
financial year.
CHANGE IN NATURE OF BUSINESS
There was no change in the nature of business of your company during
the year.
DIVIDEND
Your Directors have not recommended dividend for the year ended 31st
March, 2015.
TRANSFER TO RESERVES
The net movement in the Reserves of the Company is as under:
Particulars F.Y. 2014-15 F.Y. 2013-14
General Reserve Rs. 20,00,000/- Rs. 20,00,000/-
Security Premium Account Rs. 24,750/- Rs. 7,500/-
Decrease in Revaluation
Reserve Rs. 4,40,529/- Rs. 4,40,529/-
Surplus in Statement of
Profit and Loss Rs. 60,48,885/- Rs. 18,40,691/-
DEPOSITS FROM PUBLIC
During the year under review, your Company did not invite / accept any
Deposits from the public under section 73 and 74 of the Companies Act,
2013 read with Companies (Acceptance of Deposits) Rules, 1975.
EXTRACT OF ANNUAL RETURN
Pursuant to the Section 92(3) of the Companies Act, 2013 extract of
the Annual Return is annexed to this report as Annexure I and form
part of the Annual Report.
NUMBER OF BOARD MEETINGS
During the Financial Year 2014-15, 5 (Five) Board Meetings were held
and the gap between two meetings did not exceed four months. The Board
Meetings were held on 30.05.2014, 13.08.2014, 02.09.2014, 13.11.2014
and 12.02.2015.
DIRECTORS & KEY MANAGERIAL PERSONNEL
In terms of Section 149 of the Act, the Members, at their meeting held
on 30th September, 2014, appointed the following as Independent
Directors of the Company:
* Mr. Pankaj Aggarwal
* Mr. Chaitanya Dalmia
* Mrs. Abhilasha Goenka
The Company has received the declaration under section 149(6) of the
Companies Act, 2013 from the Independent Directors of the Company.
In terms of Section 203 of the Act, the following were designated as
Key Managerial Personnel of your Company by the Board:
* Mr. Ashok Kumar Modi, Managing Director
* Mr. Pawan Kumar Modi, Joint Managing Director cum Chief Financial
Officer
In terms of section 196 of the Act, on recommendation of Nomination
and Remuneration Committee, the Board of Directors of the Company at
its meeting held on 3rd July, 2015 extended the terms of Mr. Ashok
Kumar Modi, Managing Director and Mr. Pawan Kumar Modi, Joint Managing
Director of the Company for five year i.e. upto on 3rd July, 2020.
In accordance with the requirements of the Act and the Articles of
Association of the Company, Mr. Vasu Modi retires by rotation and is
eligible for re-appointment.
During the year under review Mr. Anshuman Goenka, an Independent
Director of the Company, had resigned w.e.f. 2nd September, 2014. Also
Mrs. Abhilasha Goenka was appointed as an Independent Director of the
Company w.e.f. 2nd September, 2014.
AUDITORS & AUDITORS' REPORT
A. Statutory Auditors
M/s. R. K. Govil & Co., Chartered Accountants, Statutory Auditor of
the Company, holds office till the conclusion of the ensuing Annual
General Meeting and is eligible for re-appointment.
The Company has received letter from the auditor to the effect that
their appointment, if made, would be within the prescribed limits
under section 141(3)(g) of the Companies Act, 2013 and that they are
not disqualified for re-appointment.
B. Secretarial Auditors
M/s. Deepak Bansal & Associates, Company Secretaries, were appointed
as Secretarial Auditors to conduct Secretarial Audit of records and
documents of the Company for financial year 2014-15. The Secretarial
Audit Report confirms that the Company has generally complied with the
provisions of the Act, Rules, Regulations, Guidelines, etc. The
Secretarial Audit Report is given in Annexure II and form part of the
Annual Report.
C. Cost Auditors
In terms of provision of section 148(1) of the Companies Act, 2013
read with rule 4 of the Companies (Cost Records and Audit) Amendment
Rules, 2014, Company is not required to maintain cost records for the
financial year 2014-15.
However, in terms of provision of section 209(1)(d) of the Companies
Act, 1956, applicable for the financial year 2013-14 for the product
manufactured by the Company, the Company has filed the Cost Audit
Report for the financial year 2013-14 on 25th September, 2014, within
the prescribed time during the year under review.
D. Internal Auditors
Your Company has appointed M/s. B.R.Maheswari & Co., Chartered
Accountants, New Delhi as Internal Auditors of the Company for the
financial year 2015-16.
EXPLANATIONS OR COMMENTS ON QUALIFICATION, RESERVATION OR ADVERSE
REMARKS:
a) By Statutory Auditors :
There are no qualifications made by the Auditors in their Report which
requires any explanation from the Board of Directors of the Company.
The Notes to Accounts referred to in the Auditors' Report are
self-explanatory and do not call for any further comments.
b) By Secretarial Auditors :
There were no comments in the Secretarial Auditors Report which
requires any explanation from the Board of Directors of the Company.
FRAUD
Neither the Auditors nor the Secretarial Auditors have brought to the
notice of the Audit Committee or the Board of Directors or the Central
Government the occurrence or brewing of any fraud in the Company.
MATERIAL CHANGES AFFECTING THE FINANCIAL POSITION OF THE COMPANY
There have been no material changes and commitments which can affect
the financial position of the company between the end of the period
under review and date of this report.
AUDIT COMMITTEE
The details pertaining to composition of Audit Committee are included
in the Corporate Governance Report which forms part of this report.
DETAILS OF SUBSIDIARY, JOINT VENTURES AND ASSOCIATE
The Company does not have any Subsidiary Company or Joint Venture
Company. The detail of Associate Company is given in Extract of Annual
Return under Annexure I of this report.
PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTY
All related party transactions done by the Company during the
financial year were at arm's length and in ordinary course of
business. All related party transactions were placed in the meetings
of Audit Committee and the Board of Directors for their necessary
review and approval. During the financial year your Company has not
entered into any material transaction (as per Clause 49 of the Listing
Agreement) with any of its related parties which may have potential
conflict with the interest of the Company at large. Disclosures
pursuant to Accounting Standards on related party transactions have
been made in the notes to the Financial Statements.
PARTICULARS OF LOAN, GUARANTEES, SECURITIES AND INVESTMENTS
The Company has not given any loan, guarantee, securities or made any
investments under Section 186 of the Companies Act, 2013
INTERNAL FINANCIAL CONTROLS
The Company has an Internal Control System, commensurate with the
size, scale and complexity of its operations. To maintain its
objectivity and independence, the Internal Audit function reports to
the Chairman of the Audit Committee and to the Chairman and Managing
Director of the Board.
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 at all
locations of the Company. Based on the report of internal audit
function, process owners undertake 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 and the Board.
RISK MANAGEMENT
The Board of Directors of your Company has, on recommendation of the
Audit Committee framed and adopted a policy on Risk Management of the
Company. Major risks identified by the businesses and functions are
systematically addressed through mitigating actions on a continuing
basis.
DETAILS OF SIGNIFICANT & MATERIAL ORDERS PASSED BY THE REGULATORS OR
COURTS OR TRIBUNAL
There are no significant material orders passed by the Regulators /
Courts which would impact the going concern status of the Company and
its future operations.
WHISTLE BLOWER/VIGIL MECHANISM
Your Company has an effective Vigil Mechanism system which is embedded
in its Code of Conduct to report to the management instances of
unethical behaviour, actual or suspected, fraud or violation of the
Company's code of conduct or ethics policy. The Code of Conduct of
your Company serves as a guide for daily business interactions,
reflecting your Company's standard for appropriate behavior and living
Corporate Values. The Vigil Mechanism provides a mechanism for
employees of the Company to approach the Chairman of the Audit
Committee of the Company.
NOMINATION & REMUNERATION POLICY
The broad terms of reference of the Nomination and Remuneration
Committee ("NRC") of the Company are as under:
a) To identify suitable persons, interview them, if necessary, and
recommend them as suitable candidates to fill up vacancies on the
Board or augment the Board and Senior Management.
b) To develop a policy to ensure the optimum composition of the Board
of Directors ensuring a mix of knowledge, experience and expertise
from diversified fields of knowledge i.e. Policy on Board Diversity.
The Policy also intends to add professionalism and objectivity in the
process of deciding Board membership.
c) To lay down criteria for the evaluation of the Board.
d) To formulate a criteria for determining qualifications, positive
attributes and independence of a Director and recommend to the Board a
Policy thereon.
e) To formulate criteria for evaluation of Directors.
The company has adopted a Nomination and Remuneration Policy as
recommended by "NRC" and the objective of Nomination and Remuneration
Policy is to ensure rationale and objectivity in the remuneration of
the Directors, Senior Management & employees of the Company. The
Policy also intends to bring in a pragmatic methodology in screening
of candidates who may be recommended to the position of Directors and
to establish effective evaluation criteria to evaluate the performance
of every Director and the overall Board of the Company.
The Policy also serves as a guiding principle to ensure good Corporate
Governance as well as to provide sustainability to the Board of
Directors of the Company
The policy as adopted is framed in accordance with provisions
contained in sub-section (3) of Section 178 of the Companies Act, 2013.
Provisions of Section 197(12) of the Companies Act, 2013, read with
Rule 5 of The Companies (Appointment and Remuneration of Managerial
Personnel) Rules, 2014, are not applicable to your Company as no
Director of the Company is drawing remuneration from the Company
during the year under review. None of the employees is related to any
Director of the Company.
FORMAL EVALUATION OF BOARD, COMMITTEES & DIRECTORS' PERFORMANCE
Pursuant to the provisions of the Companies Act, 2013 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 & Remuneration and other Committees.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE
EARNINGS AND OUTGO
Information in accordance with the provisions of Section 134 (3) (m)
of the Companies Act, 2013 read with Rule 8 of Companies (Accounts)
Rules, 2014 regarding conservation of energy, technology absorption
and foreign exchange earnings and outgo for the year ended 31st March,
2015 are annexed as Annexure III and form an integral part of this
report.
PARTICULARS OF EMPLOYEES
The information required under Rule 5 (2) and (3) of The Companies
(Appointment and Remuneration of Managerial Personnel) Rules, 2014, is
not required as there was no employee on the payroll of the Company
receiving remuneration in excess of limit prescribed under the said
rules.
CORPORATE GOVERNANCE
In terms of Circular Number CIR/CFD/POLICY CELL/7/2014 dated September
15, 2014, issued by SEBI, the provision of clause 49 is not mandatory
as paid-up share capital of the Company is less than Rs. 10 crore and
net-worth of the Company is less than Rs. 25 crore, as on the last day
of the previous financial year. Your Directors has voluntarily done
compliance to the requirement set out by the Securities and Exchange
Board of India's Corporate Governance practices and have implemented
the prescribed stipulations.
A Report on Corporate Governance annexed as Annexure V and Management
Discussion & Analysis Report annexed as Annexure IV, in terms of
Clause 49 of the Listing Agreement together with a Certificate from
the Company Secretary in practice confirming compliance with the
conditions of Corporate Governance form part of the Annual Report.
CORPORATE SOCIAL RESPONSIBILITIES
The provision of section 135 of the Companies Act, 2013 is not
applicable on the Company as your Company did not meet any of the
applicability criteria as specified under Companies (Corporate Social
Responsibility Policy) Rules, 2014.
DISCLOSURE UNDER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE, (PREVENTION,
PROHIBITION & REDRESSAL) ACT, 2013
Your company did not come across any complaints by any employees
during the year under review relating to the sexual harassment.
DIRECTORS' RESPONSIBILITY STATEMENT
Based on the framework of internal financial controls and compliance
systems established and maintained by the Company, work performed by
the internal, statutory, cost auditors, secretarial auditors and
external consultants and the reviews performed by Management and the
relevant Board Committees, including the Audit Committee, the Board is
of the opinion that the Company's internal financial controls were
adequate and effective during the financial year 2014-15.
Pursuant to Section 134(3)(c) of the Companies Act, 2013, your
Directors in respect of the Audited Annual Accounts for the year ended
31st March, 2015, to the best of their knowledge and ability, hereby
state and confirm that:
(i) In the preparation of the annual accounts, the applicable
accounting standards have been followed along with proper explanation
relating to material departures;
(ii) They have, 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 ended on March 31, 2015
and of the profit of the Company for that period;
(iii) They have taken proper and sufficient care for the maintenance
of adequate accounting records in accordance with the provisions of
Companies Act, 2013 for safeguarding the assets of the Company and for
preventing and detecting fraud and other irregularities;
(iv) They have prepared the annual accounts on a going concern basis.
(v) They have laid down internal financial controls to be followed by
the company and that such internal financial controls are adequate and
were operating effectively.
(vi) They have devised proper systems to ensure compliance with the
provisions of all applicable laws and that such systems were adequate
and operating effectively.
APPRECIATION & ACKNOWLEDGEMENT
Your Directors take this opportunity to express their appreciation for
the co-operation and assistance received from the Central Government,
the State Government, the Financial Institutions, Banks as well as the
Shareholders during the year under review. Your Directors also with
the place on record their appreciation of the devoted and dedicated
service rendered by all the employees of your Company.
For and behalf of the Board of Directors
For NATIONAL GENERAL INDUSTRIES LIMITED
Sd/-
Place : New Delhi Ashok Kumar Modi
Date : 03.09.2015 Chairman and Managing Director |