To the Members,
Your Directors have pleasure in presenting the 23rd Annual Report of the Company along
with the Audited Financial Statements for the Financial Year ended March 31, 2017.
FINANCIAL HIGHLIGHTS
The financial performance of the Company for the financial year ended March 31, 2017 is
tabulated below:
(Amount in Lacs)
| Particulars |
For Financial Year |
For Financial Year |
|
2016-17 |
2015-16 |
| Revenue from Operation |
- |
- |
| Other Income |
199.77 |
268.22 |
| Total Revenue |
199.77 |
268.22 |
| Total Expenditure |
473.23 |
178.42 |
| Profit/(Loss) before Exceptional Items and Tax |
(273.47) |
89.80 |
| Exceptional Items (Income/(Exps)) |
- |
- |
| Profit/(Loss) before Tax |
(273.47) |
89.80 |
| Tax expense |
0 |
0 |
| Net Profit/ (Loss) for the period |
(273.47) |
89.80 |
The accumulated losses of the Company are more than 50% of its net worth. In view of
abnormal market conditions & volatility in addition to financial liquidity
constraints, the Company had discontinued its manufacturing activity since February 2013.
Since the Company’s had discontinued its manufacturing activity in February 2013
due to financial problems, there was no significant development during the year under
review affecting the operations of the Company.
DIVIDEND
In view of losses, your Directors regret their inability to recommend dividend on
Equity Shares of the Company for the year ended March 31, 2017
MATERIAL CHANGES AND COMMITMENTS
There have been no material changes and commitments, affecting the financial position
of the Company, which have occurred between the end of the financial year of the Company
and the date of this Report.
SHARE CAPITAL
The Authorised Share Capital of the Company is Rs. 5000 Lakhs. The issued, subscribed
& paid up capital of the Company was Rs. 3747.256 Lakhs as on 31 March, 2017
consisting of 30,412,560 Equity Shares of Rs. 10/- each and 7,06,000 Preference shares of
Rs. 100 each.
During the year under review the Company has not altered its share capital.
SUBSIDIARY COMPANIES, JOINT VENTURES AND ASSOCIATE COMPANIES
As on 31st March, 2017, the Company does not have any subsidiary Company,
associate Company or any Joint Venture.
DIRECTORS AND KEY MANAGERIAL PERSONNEL
a) Appointment/Re-appointment of Director
In terms of the provisions of Section 152(6) of the Act, Mr. Harish Seth (DIN
00002948), is liable to retire by rotation at the ensuing Annual General Meeting and being
eligible, offer himself for re-appointment. The Board recommends his re-appointment.
Brief resume of the Directors proposed to be re-elected is included in the Notice for
the ensuing Annual General Meeting.
b) Changes in Key Managerial Personnel
Pursuant to the provisions of Section 2(51) and 203 of the Companies Act, 2013 read
with Rule 8 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules,
2014, Mr. Harish Seth (Chairman & Managing Director) acting as Key Managerial
Personnel of the company as on 31st March, 2017.
During the year, there has been no change in the Key Managerial Personnel of the
Company.
c) Declaration by Independent Director
All the Independent Directors have submitted their disclosures to the Board that they
fulfill all the requirements as stipulated in Section 149(6) of the Companies Act, 2013 so
as to qualify themselves to be appointed as Independent Directors under the provisions of
the Companies Act, 2013 and the relevant rules.
The Company has received necessary declaration from each Independent Director under
Section 149(7) of the Companies Act, 2013 (the Act), that he/she meets the criteria of
independence laid down under Section 149(6) of the Act.
PERFORMANCE EVALUATION OF BOARD, COMMITTEES AND DIRECTORS
The Board of Directors has carried out an annual evaluation of its own performance,
Board Committees and Individual Directors pursuant to the provisions of the Companies Act,
2013 and SEBI (Listing Obligations and Disclosure Requirements), Regulations 2015.
The evaluation framework for assessing the performance of Directors comprised of
criteria like contribution in Board process, time devoted for the Company, attendance of
Board Meetings and Committee Meetings and commitment to shareholder and other stakeholder
interests. Using appropriate criteria, the performance of the various Committees was
separately evaluated by the Board.
AUDITORS & AUDITORS’ REPORT
Pursuant to the provisions of section 139 of the Act and the rules framed thereafter,
M/s Sehgal Mehta & Co., Chartered Accountants, were appointed as statutory auditors of
the Company from the conclusion of the twentieth annual general meeting (AGM) of the
Company held on September 30, 2014 till the conclusion of the twenty fifth AGM to be held
in the year 2019, subject to ratification of their appointment at every AGM. Accordingly,
the appointment of M/s. Sehgal Mehta & Co., Chartered Accountants, as Statutory
Auditors of the Company, is placed for ratification by the shareholders.
The Company has received confirmation from the Statutory Auditors regarding their
consent and eligibility under Sections 139 and 141 of the Companies Act, 2013 read with
the Companies (Audit & Auditors) Rules, 2014 for appointment as the Statutory Auditors
of the Company.
The auditors’ report does not contain any qualifications, reservations or adverse
remarks.
COMMITTEES OF THE BOARD
The Board has constituted various committees in accordance with the requirements of
Companies Act, 2013. The Board has following committees:
a. Audit Committee b. Stakeholders & Relationship Committee c. Committee of
Directors
COMPOSITION OF AUDIT COMMITTEE
The Audit Committee is constituted in line with the provisions of Section 177 of the
Companies Act, 2013 read with Rule 6 and 7 of the Companies (Meetings of the Board and its
Powers) Rules, 2014.
The Audit Committee assists the Board in the dissemination of financial information and
in overseeing the financial and accounting processes in the Company.
The Composition of Audit Committee is given below:
| Name of the Members |
Chairman/Member |
Category of Director |
| Mr. B. B. Mathur |
Chairman |
Non- Executive & Independent Director |
| Mr. Ramesh Mehra |
Member |
Non- Executive & Independent Director |
| Mr. Harish Seth |
Member |
Executive Director |
MEETINGS OF THE BOARD
The Board met four (4) times during the financial year 2016-2017 on 6th June, 2016,
12th August, 2016, 14th November, 2016 and 11th February, 2017. The necessary quorum was
present for all the meetings. The maximum interval between any two meetings did not exceed
120 days.
Composition of Board
The strength of the Board of Directors as on 31st March, 2017 was 3 Directors. The
Board comprises of one executive Director designated as Chairman & Managing Director.
The rest are Non-executive Independent Directors. No woman Director is appointed on the
Board.
| Name of the Director |
DIN |
Designation |
| Mr. Harish Seth |
00002948 |
Chairman & Managing Director |
| Mr. B. B. Mathur |
00004452 |
Independent Director |
| Mr. Ramesh Mehra |
00003334 |
Independent Director |
PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS:
Your Company has not made any loan to any person within the meaning of Section 186 of
the Companies Act, 2013 and has also not given any guarantees/securities or made any
investment within the meaning of that section.
RELATED PARTY TRANSACTIONS:
During the year your company has not entered into related party transactions (RPTs)
that would have attracted the provisions of section 188 of Companies Act, 2013 and rules
made thereunder and Regulation 23 of the SEBI (Listing Obligations and Disclosure
Requirements) Regulations, 2015
PUBLIC DEPOSITS:
During the period under review, the Company has not accepted any deposits within the
meaning of Section 73 of the Companies Act, 2013 and the Companies (Acceptance of
Deposits) Rules, 2014.
INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THE FINANCIAL STATEMENTS
The Company has an Internal Control Framework which is commensurate with the size,
scale and complexity of its operations. This framework ensures adequate safeguards and
processes to address the evolving business requirements.
Extract of Annual Return:
The extract of Annual Return as provided under sub-section (3) of section 92 of the
Companies Act, 2013, in the prescribed Form MGT-9 is annexed to this Report as Annexure
I.
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.
CLARIFICATION TO REMARKS CONTAINED IN THE AUDITORS REPORT Report on other legal and
Regulatory requirements
Clause 2 (d) & (e) of the Auditors Report: As per the legal opinion given by
the legal advisors of the Company, the Foreign Financial Institution (AFIC) or its
Assignee, cannot enforce any outstanding against the Company in any court of law despite
existence of debt, as the same has become a time barred debt under provisions of the
Limitations Act, 1963. Based on the said opinion of the advisors.
Clause 2 (d) of the Auditors Report : No provision has been made for interest, in
respect of the foreign currency loan of Rs.161924 thousands; and
Clause 2 (e) of the Auditors Report: The outstanding by way of secured and
unsecured loan and interest aggregating to Rs.161924 thousands thereon (shown as an
"Erstwhile loan barred by limitation" in the
Balance Sheet of the Company for the financial year ended March 31, 2016) have not been
reinstated, as required under Accounting Standard (AS11) on the effects of changes in
foreign exchange rates notified in the Companies (Accounting Standards) Rule 2006.
DIRECTORS’ RESPONSIBILITY STATEMENT
Pursuant to Section 134(5) of the Companies Act, 2013, the board of directors, to the
best of their knowledge and ability, confirm that:
a) in the preparation of the annual accounts, the applicable accounting standards have
been followed along with proper explanation relating to material departures;
b) hey have selected such accounting policies and applied 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 loss of the
company for that period,
c) they have 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;
d) the annual financial statements have not been prepared on going concern
assumption/basis;
e) 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; and
f) they have devised proper systems to ensure compliance with the provisions of all
applicable laws and that such systems were adequate and operating effectively.
REGULATORY ORDERS
There are no significant and material orders passed by the regulators or courts or
tribunals during the year.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO
Since your Company has ceased its operations, the requirements pertaining to disclosure
of particulars relating to conservation of energy, research & development and
technology absorption, as prescribed under Section 134(3)(m) of the Companies Act, 2013
read with Rule 8 of The Companies (Accounts), Rules, 2014 is not applicable to the
Company.
There were no foreign exchange earnings or outgo during the year.
PARTICULARS OF EMPLOYEES
Since the Company has discontinued its operations, there was no employee in the Company
so the Company is not require to give details as required under section Section 197(12) of
the Companies Act, 2013 read with Rules 5(2) and 5(3) of the Companies (Appointment and
Remuneration of Managerial Personnel) Rules, 2014.
VIGIL MECHANISM POLICY
As there was no employee in the Company during the year, the Company has not framed the
Policy on Vigil Mechanism.
CORPORATE GOVERNANCE
As the net worth of your company is in negative, then as per Regulation 15 of SEBI
(Listing Obligations & Disclosure Requirements) Regulations, 2015, the provisions
related to Corporate Governance are not applicable on the Company.
ACKNOWLEDGEMENTS
Your Directors take this opportunity to express their gratitude for the assistance and
cooperation received from the shareholders, Banks and other authorities for their
consistent support and cooperation to the Company during the year under review.
|
On Behalf of the Board of Directors |
|
For Pearl Engineering Polymers Limited |
|
Sd/- |
| Place: New Delhi |
Harish Seth |
| Date: August 12, 2017 |
Chairman & Managing Director |
|
DIN : 00002948 |
+91-9892691696
