Amit Spinning Industries Ltd Directors Report.

Dear Members,

Your Directors have great pleasure in presenting the 28thAnnual Report together with Audited Statements of Accounts of the Company for the year ended March 31,2020.

FINANCIAL RESULTS:

The summarized financial results for the year ended March 2020 as compared to the previous year are as follows:

Particulars 2018-2019 2018-2019
Revenue from Operation 3946.45 -
Other Income 7.42 -
Profit before depreciation, interest finance charges and tax (PBDIT) (317.68) (296.86)
Less: Interest and Finance Charges 413.60 132.25
Less: Depreciation 251.99 278.43
Profit/(Loss) before Tax (PBT) (983.27) (707.54)
Less : Tax Expense/Deferred Tax - -
Profit/(Loss) after Tax (PAT) (983.27) (707.54)
Other Comprehensive Income - -
Total Comprehensive Income (983.27) (707.54)

REVIEW OF OPERATIONS

After obtaining physical possession of the factory the Management carried out repairs and maintenance activities and started trail production in May 2019.

Further the Company has started its Commercial Production from October 2019. During the year under review, the turnover of the Company was 3946.45 which was nil during the last year. Company has not utilized its manufacturing capacity to its optimum level which resulted in loss of Rs. 983.27 lakhs during the year. Further Management is actively involved in trying to utilize the idle capacities available with the Company.

COVID 19

Covid 19 pandemic which rapidly turned into global crisis forced the government to enforce the lockdown the Country which had an effect on all economic activities in the Country. To ensure safety of workmen, employees and all stakeholders at large the Company temporarily closed its Manufacturing and other operations since lockdown in March 2020. Further the Company had resumed partial

manufacturing operations from 4 June 2020 with limited workforce and subject to conditions as stipulated by Government from time to time.

MAJOR EVENTS OCCURRED DURING THE YEAR

There have been no material changes and commitments, which affect the financial position of the company which have occurred during the year and between the end of the financial year to which the financial statements relate and the date of this Report except COVID - 19 pandemic which is discussed above.

SHARE CAPITAL

The Companys Authorized Share Capital as on 31st March, 2020 stands at Rs. 25,00,00,000/- and issued & paid up capital as on 31st March, 2020 stands at Rs. 20,58,48,335/- divided into 4,11,69,667 fully paid up equity shares of Rs. 5/- each. During the year, under review, the Company has not issued any share(s). Further the Company has not issued any share with differential Voting Rights/Sweat Equity shares/under Stock Option Scheme (ESOS) earlier and during the year.

NCLT by its order dt. 31-07-2018 approved Reduction of Face Value of Shares to Re. 0.50 per Share from Re. 5 Per Share and further consolidation of face value of shares to Re. 5 per share. Post consolidation paid up equity shares will reduce from 4,11,69,667 shares of Rs. 5/- each to 41,16,967 equity shares of Rs. 5/- each. It also involves extinguishment of shares of previous Promoters and top 10 shareholders. However compliance / corporate actions of the same with CDSL, NSDL, ROC and Stock Exchanges were pending at the end of the March 2020. However the said corporate actions have been initiated in the month of July 2020.

The Company has no scheme of provision of money for purchase of its own shares by employees or by trustees for the benefit of employees. Hence the details under rule 16 (4) of Companies (Share Capital and Debentures) Rules, 2014 are not required to be disclosed

INVESTOR EDUCATION AND PROTECTION FUND (IEPF)

During the year under review company was not required to transfer any amount as well as any shares to the Investor Education and Protection Fund (IEPF)

DIVIDEND:

In view of the losses the Board of Directors do not recommend any dividend for the year.

RESERVES:

In view of the losses, your Board of Directors has decided not to transfer any amount to the Reserves for the year under review.

LOANS, GUARANTEE & INVESTMENTS:

The Company has not advanced any loans or provided guarantees or made investments during the year under review.

DEPOSITS:

The Company has not accepted any deposit from the public falling within the ambit of Section 73 of the Companies Act, 2013 and the Companies (Acceptance of Deposits) Rules, 2014, or under Chapter V of the Act.

LISTING OF SHARES

Presently Companys shares are listed and traded at the BSE Limited, Mumbai (BSE) and National Stock Exchange of India, Mumbai (NSE). The Listing fees for the year2019-20 has been paid. Due to liquidity issues company has not paid Annual Listing fee for 2020-21 however Board of Directors hereby confirm that it will be paid soon.

DIRECTORS AND KEY MANAGERIAL PERSONNEL

During the year under review, Mahaveer Bhandari was appointed as an Non executive Independent Director of the Company w.e.f. 31.05.2019.

Further Mr. Mahaveer Bhandari, Mr. Amol Kanwade and Mr. Satish Murabatte resigned from the position of Independent Directors on 14.02.2020, 24.02.2020 and 25.02.2020 respectively.

Mr. Pruthveesh Shetti, Mr. Siddhant Patil and Mr. Vijay Dhudharkar were appointed as additional non executive directors in the category of Independent Directors 31.07.2020, 31.07.2020 and 05.09.2020 respectively..

Brief resume of the Directors proposed to be appointed/re-appointed, nature of their expertise in specific functional areas and names of the companies in which they hold directorship and membership/chairmanships of the Board or its Committees, as stipulated under SEBI (LODR) Regulations entered into by the Company with stock exchanges in India, is provided in the Report of Corporate Governance forming part of the Annual Report.

RELATED PARTY TRANSACTIONS:

There were no related party transactions during the year. Hence no disclosure is required to be given in form AOC 2.

DECLARATION OF INDEPENDENT DIRECTORS

The Independent Directors have given declarations that they meet the criteria of Independence and have complied with the Code for Independent Directors prescribed in Schedule IV to the Act as laid down under Section 149(6) of the Act and Regulation 16(1 )(b) of the Listing Regulations. Further they also had confirm that they are not aware of any circumstance or situation, which exist or may be reasonably anticipated, that could impair or impact their ability to discharge their duties with an objective independent judgment and without any external influence and that they are independent of the management.

POLICY ON DIRECTORS APPOINTMENT AND REMUNERATION:

Remuneration Policy

The Board has, on the recommendation of the Nomination & Remuneration Committee framed policy for selection and appointment of Directors, Senior Management and their remuneration in pursuant to Section 178 of Companies act 2013 and Regulation 19 SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015. The remuneration given is as per the remuneration policy framed.

Criteria for Determining the Qualifications for appointment of Directors (including Independent Directors)

i. Persons of eminence, standing and knowledge with significant achievements in business, professions and/or public service;

ii. Their technical, financial, HR, Legal, or business literacy/skills i.e. knowledge about textile business;

iii. Their administrative experience;

iv. Other appropriate qualification/experience to meet the objectives of the Company;

v. As per the applicable provisions of Companies Act, 2013, Rules made thereunder and as per provisions of SEBI( LODR) Regulations.2015 .

The Nomination and Remuneration Committee shall have discretion to consider and fix any other criteria or norms for selection of the most suitable candidate/s.

Positive attributes of Directors (including Independent Directors):

a. Directors are to demonstrate integrity, credibility, trustworthiness, ability to handle conflict constructively and the willingness to address issues proactively;

b. Actively update their knowledge and skills with the latest developments in the infrastructure industry, market conditions and applicable legal provisions;

c. Willingness to devote sufficient time and attention to the Companys business and discharge their responsibilities.

d. To assist in bringing independent judgment to bear on the Boards deliberations especially on issues of strategy, performance, risk management, resources, key appointments and standards of conduct;

e. Ability to develop a good working relationship with other Board members and contribute to the Boards working relationship with the senior management of the Company;

f. To act within their authority, assist in protecting the legitimate interests of the Company, its shareholders and employees;

g. Independent Directors to meet the requirements of the Companies Act, 2013 read with the Rules made there under and as per provisions of SEBI( LODR) Regulations 2015 as amended from time to time.

Independence Review Procedures

- Annual Review

The directors independence for the independent director will be determined by the Board on an annual basis upon the declaration made by such Director as per the provisions of the Companies Act, 2013 read with Rules thereon and as per provisions of SEBI( LODR) Regulations.2015

- Individual Directors Independence Determinations

If a director nominee is considered for appointment to the Board between Annual General Meetings, a determination of independence, upon the recommendation of the Committee, shall be made by the Board prior to such appointment.

All determinations of independence shall be made on a case-by-case basis for each director after consideration of all the relevant facts and circumstances and the standards set forth herein. The Board reserves the right to determine that any director is not independent even if he or she satisfies the criteria set forth by the provisions of the Companies Act, 2013 read with Rules thereon and as per provisions of SEBI( LODR) Regulations.2015

- Notice of Change of Independent Status

Each director has an affirmative obligation to inform the Board of any change in circumstances that may put his or her independence at issue.

a. Criteria for appointment of KMP/Senior Management -

i. To possess the required qualifications, experience, skills & expertise to effectively discharge their duties and responsibilities;

ii. To practice and encourage professionalism and transparent working environment;

iii. To build teams and carry the team members along for achieving the goals/objectives and corporate mission;

iv. To adhere strictly to code of conduct

b. Term -

The Term of the Directors including Managing / Whole time Director / Independent Director shall be governed as per the provisions of the Act and Rules made thereunder and the Listing Regulations, as amended from time to time. Whereas the term of the KMP (other than the Managing / Whole time Director) and Senior Management shall be governed by the prevailing HR policies of the Company.

c. Evaluation -

The Committee shall carry out evaluation of performance of every Director. The Committee shall identify evaluation criteria which will evaluate Directors based on knowledge to perform the role, time and level of participation, performance of duties, level of oversight, professional conduct and independence. The appointment / re-appointment /continuation of Directors on the Board shall be subject to the outcome of the yearly evaluation process.

d. Removal -

Due to reasons for any disqualification mentioned in the Act or under any other applicable Act, Rules and Regulations thereunder and /or for any disciplinary reasons and subject to such applicable Acts, Rules and Regulations and the Companys prevailing HR policies, the Committee may recommend to the Board with reasons recorded in writing, removal of a Director, KMP or Senior Management.

e. Remuneration of Managing / Whole-time Director, KMP and Senior Management

The remuneration / compensation / commission, etc., as the case may be, to the Managing / Wholetime Director will be governed by the relevant provisions of the Companies Act, 2013 and applicable Rules and Regulations and will be determined by the Committee and recommended to the Board for approval. The remuneration / compensation / commission, etc., as the case may be, shall be subject to the prior / post approval of the shareholders of the Company and Central Government, wherever required. Further, the Chairman & Managing Director of the Company is authorized to decide the remuneration of KMP (other than Managing / Wholetime Director) and Senior Management based on the standard market practice and prevailing HR policies of the Company.

f. Remuneration to Non-executive Directors (Including independent Director)

The remuneration / compensation / commission, etc., as the case may be, to the Managing / Wholetime Director will be governed by the relevant provisions of the Companies Act, 2013 and applicable Rules and Regulations and will be determined by the Committee and recommended to the Board for approval.

PERFORMANCE EVALUATION OF THE BOARD:

Pursuant to the provisions of the Act and Listing Regulations, the Board has carried out an annual evaluation of its own performance, also performance of the Directors individually as well as the evaluation of the working of its Committees.

The Nomination and Remuneration Committee has defined the evaluation criteria, procedure and time schedule for the Performance Evaluation process for the Board, its Committees and individual Directors, including the Chairman of the Company.

For evaluating the Board as a whole, views were sought from the Directors on various aspects of the Boards functioning such as degree of fulfillment of key responsibilities, Board Structure and composition, establishment, delineation of responsibilities to various committees, effectiveness of Board processes, information and functioning, Board culture and dynamics, quality of relationship between the Board and the management.

Similarly, views from the Directors were also sought on performance of individual Directors covering various aspects such as attendance and contribution at the Board/Committee Meetings and guidance/support to the management outside Board/Committee Meetings. In addition, the Chairman was also evaluated on key aspects of his role, including setting the strategic agenda of the Board, encouraging active engagement by all Board members and promoting effective relationships and open communication, communicating effectively with all stakeholders and motivating and providing guidance to the Executive Director.

Areas on which the Committees of the Board were assessed included degree of fulfillment of key responsibilities, adequacy of Committee composition, effectiveness of meetings, Committee dynamics and quality of relationship of the Committee with the Board and the Management.

The performance evaluation of the Independent Directors was carried out by the entire Board. The performance evaluation of the Chairman and the Non Independent Directors was carried out by the Independent Directors who also reviewed the performance of the Board as a whole. The Nomination & Remuneration Committee also reviewed the performance of the Board, its Committees and of individual Directors.

The Chairman of the Board provided feedback to the Directors, as appropriate. Significant highlights, learning with respect to the evaluation, were discussed at the Board Meeting.

A MATRIX SETTING OUT THE SKILLS / EXPERTISE / COMPETENCE OF THE BOARD OF DIRECTORS IS AS UNDER

Name of the Director Category

Skills, Expertise, Competence of the Director

Technical Financial Administrative / HR Legal
Deepak Choudhari Chairman, Promoter Executive Director s s s
Jitendrakumar chopra Promoter, Executive Director s s s
Sharmiladevi Chopra Promoter, Non Executive Director s
Siddhant patil Non Executive Independent Director s s s
Pruthveesh Shetti Non Executive Independent Director s s
Vijay Dudharkar Non Executive Independent Director s s s

Number of Meetings of the Board

During the year under review, Eight meetings of the Board were held during the year. The detailed information regarding meetings of the Board held during the year is mentioned in the Corporate Governance Report which forms part to this report.

EXTRACT OF ANNUAL RETURN:

In accordance with Section 134(3)(a) and as provided under sub-section (3) of Section 92 of the Companies Act, 2013 an extract of the annual return in prescribed form MGT - 9 has been posted on the website of the company i.e. www.girnarspintex.com.

MANAGEMENT DISCUSSION AND ANALYSIS:

Management Discussion and Analysis Report is attached to the Directors Report as Annexure 1. CORPORATE GOVERNANCE:

Corporate Governance report is provided separately in this annual report.

AUDITORS AND AUDITORS REPORT

(a) Statutory Auditor & Audit Report

In accordance with the provisions of Section 139 of the Companies Act, 2013, at the Annual General Meeting held on September 27, 2018 M/s Sanjay Vhanbatte were appointed as Statutory Auditors of the Company for the period of 5 years commencing from the conclusion of 26th Annual General Meeting till the conclusion of 31st Annual General Meeting.

The requirement to place the matter relating to appointment of Auditors for ratification by members at every Annual General Meeting was omitted vide notification dated May 07, 2018, issued by Ministry of Corporate Affairs. Accordingly, no resolution is proposed for ratification of appointment of Auditors in the ensuing AGM of the Company.

Statutory Auditors i.e, M/s Sanjay Vhanbatte, have submitted Auditors Report on the accounts of the Company for the period ended 31st March 2020. With respect to statutory auditors remark about impairment of losses, management will comply with the same. Further corporate actions as per NCLT order is in process and will be completed by the end of March 31,2021.

(b) Cost Auditor:

The Companies (Cost Records and Audit Rules), 2014 is not applicable to the Company.

(c) Secretarial Auditor & Audit Report:

Pursuant to provisions of Section 204 of the Companies Act, 2013, the Company has appointed M/s. PPS and Associates, Practicing Company Secretaries as Secretarial Auditor to carry out the secretarial audit for the financial year 2019-20..

The Secretarial Audit Report for the financial year ended March 31, 2020 is annexed herewith marked as Annexure 2 to this Report.

Company has been recently taken over by the promoters. Since it was purchased under IBC Code there are huge post takeover formalities required to be complied with various government agencies, banks etc. Since plant was not operating for last many years initial efforts of the management were focused at commencing the commercial production. Further due to existing manpower tied up with post takeover formalities relating to commencement of commercial production there has been several non compliances on the part of the company.

(d) Internal Audit

Pursuant to provisions section 138 of Companies act 2013 read with Companies (Accounts) Rules 2014, the board on recommendation of Audit Committee appointed Thigale Utturkar and Associates Chartered Accountants as the Internal Auditor of the Company. The Management regularly reviews the findings of the Internal Auditor and takes effective steps to implement suggestions of the Internal Auditor.

CORPORATE RESPONSIBILITY STATEMENT (CSR):

The Company is not required to spend any amount for CSR activities at present.

DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to the requirement of Section 134(3) (c) of the Companies Act, 2013, with respect to Directors Responsibility Statement, it is hereby confirmed that:

(a) in the preparation of the annual accounts for the financial year ended 31st March, 2020, the applicable accounting standards had been followed along with proper explanation relating to material departures;

(b) 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, 2020 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 the Companies Act, 2013 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; and

(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.

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

The information as required under Section 134(3)(m) of The Companies Act, 2013 read with Rule 8(3) of The Companies (Accounts) Rules, 2014 with respect to conservation of energy, technology absorption and foreign exchange earnings and outgo is given below:

A. Conservation of energy:

The Company has been taking various steps and measures to improve efficiency in use of energy and optimize conservation of the energy by increasing the efficiency of raw material inputs in power generation and by reducing/eliminating wastages and reducing consumption of power and fuel.

LED tubes fitted to save the energy and also proper power banks introduced whenever necessary. In spite, Conservation of energy and improving the efficiency of existing resources is continuing processes and form an integral part of responsibilities of departmental heads of the Company.

B. Technology absorption:

During the year under review, the Company had purchased various new machineries. The Company has also replaced spares parts of old machineries to make it functional. The resulted and helped company to start commercial production of yarn.

C. Foreign exchange earnings and Outgo:

Particulars Current Year Previous Year
In In USD In In USD
Foreign Exchange Earnings Nil Nil Nil Nil
Foreign Exchange Outgo Nil Nil Nil Nil

VIGIL MECHANISM

The Company has framed and implemented a vigil mechanism named as Whistle Blower Policy to deal with instances of fraud and mismanagement, if any. The details of the Whistle Blower Policy are provided in the Corporate Governance Report and also hosted on the website of the Company.

During the year under review, the Company has an Internal Complaint Committee as required under Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and, there were no compliant received during the year.

PERFORMANCE OF EMPLOYEES:

1) The information required under Section 197 of the Act read with rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are given below:

Name of Director /KMP Designation Remuneration of Directors/KMP for the year ended 31st March 2020 (Rs) Ratio to median Remuneration % Increase in remuneration for the year ended 31st March 2020
Deepak Choudhari Director NIL NA NA
Jitendrakumar Chopra Managing Director NIL NA NA
Sharmiladevi Chopra Non Executive Director NIL NA NA
Amol Kanwade Independent director NIL NA NA
Satish Murabatte Independent director NIL NA NA
Mahaveer Bhandari Independent Director NIL NA NIL
Shreyans Choudhari CFO NIL NA NIL
Aniruddha Badkatte Company Secretary and Compliance Officer 241069 1.35 NIL

2) Details of the top ten employees of the Company in terms of remuneration drawn as required pursuant to 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules,2014 :

Sr. No. Name of employee Designation Remuneration % of Equity Shares held in the Company
1 KShrikant Patil Unit Head 51000 0
2 Sachin Shete General Manager Production 85000 0
3 Suryakant Patil Electrical Engineer 40,000 0
4 Raviraj Patil Maintenance Manager 40,000 0
5 Sanjay Patil Production Manager 40,000 0
6 Ajay Patil Production Manager 40,000 0
7 Annasaheb Patil HR Manager 31,000 0
8 Tatyaso Patil Winding Supervisor 25000 0
9 Aniruddha Badkatte Company Secretary 21000 0
10 Satappa M Borwadkar Accounts Incharge 20,000 0

DETAILS OF SUBSIDIARY / JOINT VENTURES / ASSOCIATE COMPANIES:

The Company does not have Subsidiary/Joint Ventures/Associate Companies.

RISK MANAGEMENT:

The Board of the Company has formed a Risk Management Committee in accordance with the provisions of the Act and Regulation 17(9) of the Listing Regulations. The Committee is responsible for reviewing the risk management plan and ensuring its effectiveness. The audit committee has additional oversight in the area of financial risks and controls. Policy to manage risk is also placed on the website of the Company. During the year, risk analysis and assessment was conducted and the details of the same are covered in the Management Discussion and Analysis Report of the Company.

FAMILIARIZATION PROGRAMME:

Pursuant to Regulation 25 of the SEBI (Listing Obligation and Disclosure Requirement) Regulations 2015 , the Company has formulated a programme for familiarizing the Independent Directors with the Company, their roles, rights, responsibilities in the Company, nature of the industry in which the Company operates, business model of the Company etc. through various initiatives. Details of the Familiarization Programme of the Independent Directors are available on the website of the Company.

VIGIL MECHANISM

The Company has framed and implemented a vigil mechanism named as Whistle Blower Policy to deal with instances of fraud and mismanagement, if any. The details of the Whistle Blower Policy are provided in the Corporate Governance Report and also hosted on the website of the Company.

During the year under review, the Company has an Internal Complaint Committee as required under Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and, there were no compliant received during the year

COMPLIANCE WITH SECRETARIAL STANDARDS

During the year under review, your Company has complied with all the applicable secretarial standards. The same has also been confirmed by Secretarial Auditors of the Company.

DISCLOSURES WITH RESPECT TO DEMAT SUSPENSE ACCOUNT / UNCLAIMED SUSPENSE ACCOUNT

The Company does not have any equity shares lying in the demat suspense account/unclaimed suspense account of the Company as on 31 March 2020. Hence disclosures required under Part F of Schedule V of the Listing Regulations is not applicable

DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTSOR TRIBUNALS IMPACTING GOING CONCERN STATUS AND COMPANYS OPERATIONS IN FUTURE

No significant orders were passed by any court.

ACKNOWLEDGEMENTS

Your Directors place on record their sincere thanks to bankers, financial institutions business associates, consultants, customers, suppliers, contractors and various Government Authorities for their continued support extended to your Companies activities during the year under review. Your Directors also acknowledge gratefully the shareholders for their support and confidence reposed on the Company.

For & on behalf of the Board

Deepak Choudhari
Chairman
DIN:03175105
Place : Kolhapur
Date : 5 September 2020