Aditya Forge Ltd Directors Report.

Dear Members,

ADITYA FORGE LIMITED

415 GIDC, RAMANGANDI, POR N H 8 VADODARA GJ IN

Your Directors have pleasure in presenting the Annual Report together with the Audited Statement of Accounts of your Company for the Year ended March 31, 2018.

1. FINANCIAL RESULTS:

The Companys financial performance, for the year ended March 31, 2018:

PARTICULARS YEAR ENDED 31st MARCH 2018. YEAR ENDED 31st MARCH 2017.
Turnover 137503159 136850599
Less: Expenditure 155306407 150950341
Profit Before Tax (11267082) (10694998)
Less: Current Tax 0.00 0.00
Deferred Tax 1828671 2998921
Income Tax earlier years 75000 0.00
Profit /Loss For The Year (9513411) (13693919)
Add: Balance in P&L Account 0.00 0.00
Sub Total (9513411) (13693919)
Less: Appropriation 0.00 0.00
Adjustment relating to Fixed Assets 0.00 0.00
Transferred to General Reserve 0.00 0.00
Closing Balance (9513411) (13693919)

2. STATE OF AFFAIRS :

The Company is engaged in the business of Manufacture of Forge Components from Carbon and & Stainless Steel and Fittings from Seamless Pipes. There has been no change in the business of the Company during the financial year ended 31st March, 2018.

The company has yet not been able to come out of the financial difficulties which were largely on account of its erstwhile Banker - Madhvapura Cooperative Bank Ltd. (MMCB). MMCB collapsed financially due to Ketan Parekh Stock market Scame in 2001 and did not financed the assured Working Capital to our unit even after implementation of expansion of installed capacity through disbursement of Term Loan. The Financial blow was lethal and unit could not sustain the business and financial loss.

Reserve Bank of India suspended the license of MMCB and ultimately bank was taken to liquidation. The Official liquidator has been struggling to complete liquidation formalities.

In the process, recovery suits have been filed against the Company. Your directors have also filed damages suit for loss of export business for over Rs 20 Crores in the year 2001-02, against the Bank for non-disbursement of working capital finance. The deadlock with Madhavpura Cooperative Bank Ltd over OTS amount has not been resolved yet. However, the present liquidator has shown positive attitude and your Directors are hopeful for a favourable resolution.

The highlights of the Companys performance are as under: -

There is a small increase in revenue from Rs. 136.85 Lakhs to Rs. 137.50 Lakhs. There has been shift in the operations from Job Work to Manufacturing and therefore there has been an improvement in the profitability. Due to shifting to Manufacturing from Job Work business the company has incurred expenses on higher side. However, due to non-availability of working capital finance, continuous under-utilization of the installed capacity the unit has not been able to come out of loss.

3. WEB LINK OF ANNUAL RETURN

Web Link has been provided on Companys Website: www.aditvaforge.com

4. MEETINGS OF BOARD OF DIRECTORS

Five Board Meetings were held during the Financial Year ended March 31, 2018 i.e. (15.04.2017,13.07.2017, 02.09.2017, 15.12.2018 23.02.2018).The maximum gap between any two Board Meetings was less than one Hundred and Twenty days.

The names of members of the Board, their attendance at the Board Meetings are as under:

Name of Directors Number of Meetings attended / Total Meetings held during the F.Y. 2017-18
SUBHASH BHAGWANDAS DALAL 04
VISHNUBHAI INDUBHAI PATEL 05
NITIN RASIKLAL PAREKH 05
SANGITA NITIN ADHVARYU 04

5. DETAILS OF FRAUD REPORT BY AUDITOR:

As per auditors report, no fraud u/s 143(12) reported by the auditor.

6. AUDITOR:

Statutory Auditors

M/s. KJ. SHAH & CO, Chartered Accountants (Firm Registration No. 132369W), who are the statutory auditors of the Company, hold office, in accordance with the provisions of the Act up to this Annual General Meeting and from whom necessary consent has been obtained under section 141 of the Companies Act, 2013 are eligible for re-appointment as required under the provisions of Section 139 of the Companies Act, 2013.

7. BOARDS COMMENT ON THE AUDITORS REPORT :

The observations of the Statutory Auditors, when read together with the relevant notes to the accounts and accounting policies are self-explanatory and does not call for any further comment.

8. PARTICULARS OF LOANS AND INVESTMENT

The companys books of accounts show following investments, which are on account of Purchase of Shares in accordance of Sanction Terms of Loans by these Cooperative Banks and not to be considered as Investments of business strategy:

Madhavpura Mercantile Co. op Bank Ltd. - Rs. 1625000 Baroda City Co-op Bank Ltd. - Rs. 6600

The Company has not given any corporate guarantee and/or mortgaged assets as securities during the year under review.

9. CONTRACTS AND ARRANGEMENTS WITH RELATED PARTIES

All related party transactions that were entered into during the financial year ended 31st March, 2018 were on an arms length basis and were in the ordinary course of business. Therefore, the provisions of Section 188 of the Companies Act, 2013 were not attracted. Further, there are no materially significant related party transactions during the year under review made by the Company with Promoters, Directors, or other designated persons which may have a potential conflict with the interest of the Company at large. Thus, disclosure in Form AOC-2 is not required.

10. TRANSFER TO RESERVE:

No amount was transferred to the reserves during the financial year ended 31st March, 2018.

11. DIVIDEND

No Dividend was declared for the current financial year due to conservation of Profits/due to loss incurred by the Company /due to insufficient profit.

12. MATERIAL CHANGES AND COMMITMENTS

No material changes and commitments affecting the financial position of the Company occurred between the end of the financial year to which this financial statement relates and the date of this report

IS. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS & OUTGO:

A. Conservation of Energy, Technology Absorption

The particulars as required under the provisions of Section 134(3) (m) of the Companies Act, 2013 in respect of conservation of energy and technology absorption have not been furnished considering the nature of activities undertaken by the company during the year under review.

B. Foreign Exchange earnings and Outgo

Earnings USD 16.39 Lakhs INR 1042.47 Lakhs
Outgo USD 2.67 Lakhs INR 132.23 Lakhs

14. RISK MANAGEMENT POLICY :

Risk Management is the process of identification, assessment and prioritization of risks followed by coordinated efforts to minimize, monitor and mitigate/control the probability and/or impact of unfortunate events or to maximise the realization of opportunities. The Company has laid down a comprehensive Risk Assessment and Minimization Procedure which is reviewed by the Board from time to time. These procedures are reviewed to ensure that executive management controls risk through means of a properly defined framework. The major risks have been identified by the Company and its mitigation process/measures have been formulated in the areas such as business, project execution, event, financial, human, environment and statutory compliance.

15. DETAILS OF SUBSIDIARY, JOINT VENTURE OR ASSOCIATE COMPANIES:

The Company does not have any Subsidiary, Joint Venture or Associate Company.

16. DIRECTORS AND KEY MANAGERIAL PERSONNEL (KMP):

There has been no change in the constitution of Board during the year under review i.e. the structure of the Board remains the same.

In view of the applicable provisions of the Companies Act, 2013, the Company is not i mandatorily required to appoint any whole time KMPs.

17. The Company has not accepted any deposits during the year under review.

18. INTERNAL FINANCIAL CONTROL

The Company has in place adequate internal financial controls with reference to financial statements. During the year, such controls were tested and no reportable material weakness in the design or operation was observed.

19. COST RECORD

The provision of Cost audit as per section 148 doesnt applicable on the Company.

20. DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS, COURTS AND TRIBUNALS

No significant and material order has been passed by the regulators, courts, tribunals impacting the going concern status and Companys operations in future.

21. CONSTITUTION OF COMMITTEE - SEXUAL HARASSMENT AT WORKPLACE

The Company has constituted committee under the sexual harassment of women at workplace (prevention, prohibition and Redressal) Act, 2013 and However, company has complied with the provisions of the same.

22. CONSOLIDATED FINANCIAL STATEMENTS

Company doesnt have any subsidiaries so there is no need to prepare consolidated financial statement for the F. Y. 2017-18

23. DIRECTORS RESPONSIBILITY STATEMENT :

Pursuant to Section 134(3) (c) of the Companies Act, 2013 the Board of Directors of the Company confirms that-

a) In the preparation of the annual accounts for the year ended March 31, 2018, the applicable accounting standards read with requirements set out under Schedule III to the Act, have been followed and there are no material departures from the same.

b) The Directors 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 as at March 31,2018 and of the profit of the Company for the year ended on that date.

c) The Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.

d) The Directors have prepared the annual accounts on a going concern basis.

e) The Company being unlisted, sub clause (e) of section 134(3) of the Companies Act, 2013 pertaining to laying down internal financial controls is not applicable to the Company.

f) The Directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such system are adequate and operating effectively.

24. ACKNOWLEDGMENT

Your Directors would like to express their sincere appreciation for the assistance and cooperation received from the banks, Government authorities, customers, vendors and members during the year under review. Your Directors also wish to place on record their deep sense of appreciation for the committed services by the Companys executives, staff and workers.