To the Members,
Your directors have pleasure in presenting the 41st Annual Report of the
Company along with audited accounts for the year ended 31st March, 2023.
(Rs. Lakhs)
| Financial Parameters |
2022-23 |
2021-22 |
| Sales (Net of GST) |
46337.47 |
8640.00 |
| Other Income |
224.94 |
818.02 |
| Profit / (Loss) before Interest, Depreciation & Exceptional Items |
1636.47 |
1119.21 |
| Interest & Finance Charges |
14.57 |
3.29 |
| Depreciation |
424.63 |
298.75 |
| Profit/(Loss) for the year before Exceptional Items |
1197.27 |
817.17 |
| Exceptional Items -Net income / (Expenditure) |
16.28 |
9.52 |
| Provision for Tax |
- |
- |
| Profit/(Loss) for the year carried to Balance Sheet |
1213.55 |
826.69 |
OUTLOOK
India is the worlds second-largest producer of crude steel. Government has taken
various steps to boost the sector including the introduction of National Steel Policy 2017
and allowing 100% Foreign Direct Investment (FDI) in the steel sector under the automatic
route. The Governments National Steel Policy 2017 aims to increase the per capita steel
consumption to 160 kgs by 2030-31.
In FY 2023-24, demand for steel is expected to increase by 7.5% to 128.85 million
tonnes, driven by rising construction activities. Steel companies are looking to restart
expansion projects on the back of burgeoning steel processes.
Sponge Iron is the basic raw material for Steel manufacturers so it is growing up
parallel with steel demand. According to National Steel Policy, 2017, the aim is to
increase the DRI production from 37.14 million tons to 80 million tons by 2030-31. India
has huge untapped potential for the growth in the sponge iron industry, as it has still
one of the lowest steel consumptions per capita (74.3 Kg.). The industrys prospects are
looking bright.
OPERATIONS
The Company was constrained to shut its Plant and Operations since 9th August, 2013 on
account of sudden stoppage of coal supply by Central Coalfields Limited, a Unit of Coal
India Limited against long term Fuel Supply Agreement. The Coal available through online
auction from various Coal Companies was of lower grades and was also available at high
price, therefore, it was not economically viable for the company to operate with the
costlier coal.
As reported last year, with a view to earn some revenue, the Company had entered into a
Facility User Agreement dated 30.12.2020 with Vanraj Steels Private Limited, Mr. Manoj
Kumar Agarwal and Parasnath Advisory Private Limited.
After complete overhauling and renovation work of the plant as well as the railway
siding, the possession of the same had been handed over to M/s. Vanraj Steels Private
Limited on 12th January, 2022. With the handing over of the plant, the Company has started
receiving the operating income.
Now the plant is in operation, and with the restart of the plant, Company has started
earning revenue and there is net profit before tax amounting to Rs. 1214 Lacs during FY
2022-23. Management is hopeful to earn good profit in future and losses suffered in past
will get wiped out in due course.
The financial statements, as such have been prepared on a going concern basis on the
strength of managements plan of revival including restructuring of liabilities, operation
of the plant through a third-party ensuring generation of revenue.
5 MW POWER PLANTS / STEEL PLANT
The Company from the existing power plant generates 5 MW of power based on 80% Dolo
Char + 20% Coal Fine, being produced in the manufacturing of sponge iron. Due to high
price of coal, power generation cost is very high. To control the overhead cost, company
has taken 3 MW power connection from Jharkhand State Electricity Board. Now power
generation will be based on its cost.
CORPORATE SOCIAL RESPONSIBILITY
The Company has formed a Corporate Social Responsibility Committee* to contribute
towards the well-being of workers/employee/nearby residents etc. The Company has a
Corporate Social Responsibility (CSR) Policy in accordance with the provisions of the Act
and rules made thereunder. The CSR Policy along with the CSR projects approved by the
Board, the composition of the Committee and other relevant details are disclosed on the
website of the Company at www.bsil.org.in.
The Annual Report on the CSR activities undertaken by the Company during the Financial
Year under review, in the prescribed format, is annexed to this Report as Annexure -F.
*Pursuant to Section 135(9) of the Companies Act, 2013, where the amount to be spent by
a company under section 135 (5) does not exceed fifty lakh rupees, the requirement under
section 135 (1) for constitution of the Corporate Social Responsibility Committee shall
not be applicable and the functions of such Committee provided under this section shall,
in such cases, be discharged by the Board of Directors of the company. Therefore, the
Corporate Social Responsibility Committee of the Company was dissolved w.e.f., 26th May
2023 and the functions of the said Committee shall now be discharged by the Board.
DIVIDEND
In view of the losses incurred by the Company in the past, no dividend has been
proposed for the financial year ended 31st March, 2023.
SHARE CAPITAL
The paid-up Equity Share Capital as on 31st March, 2023 is 9020.54 lakhs. During the
year under review, the Company has not issued shares with differential voting rights nor
granted stock options nor sweat equity.
FIXED DEPOSITS
During the year under review, your Company has not accepted any deposits within the
meaning of provisions of Chapter V - Acceptance of Deposits by Companies of the Companies
Act, 2013 read with the Companies (Acceptance of Deposits) Rules, 2014.
SUBSIDIARY, ASSOCIATE AND JOINT VENTURES
The Company does not have any Subsidiary, Associate or Joint Venture Company as on 31st
March, 2023.
MATERIAL CHANGES AND COMMITMENTS
There were no material changes and commitments affecting the financial position of the
Company which have occurred between the end of financial year and the date of report.
DIRECTORS
CHANGES IN DIRECTORS AND KEY MANAGERIAL PERSONNEL
Since last reported, the following changes have taken place in the Board of Directors
and Key Managerial Personnel:
In accordance with the provisions of Section 152 of the Companies Act, 2013 and Article
128 of the Articles of Association of the Company, Mr. Jayesh Modi (DIN: 02849637) retires
by rotation at forthcoming Annual General Meeting and being eligible offers himself for
re-appointment. Your directors recommend his re-appointment.
Your directors also recommend the regularization of Mr. Ajay Kumar Aggarwal (DIN:
00632288) as a Non- Executive Independent Director of the Company for the first term of 5
years w.e.f., 1st September 2023 to 31st August, 2028.
Mr. Shyam Babu Vyas, Non-Executive Independent Director of the Company has
ceased/vacated his office w.e.f. 20th July, 2022, pursuant to the provision of section 167
(1) (b) of the Companies Act, 2013.
Mr. Raj Kumar Sharma was re-appointed for a term of one year w.e.f. 28th July, 2021 as
Manager designated as "Senior General Manager" and he has completed his one year
term on 27th July, 2022.
Mr. Salil Seth was appointed as a Non-Executive Independent Director of the Company
w.e.f. 16th August, 2022.
Mr. Shiv Shankar Agarwal, Independent Director of the Company, has completed his 1st
term of 5 years as an Independent Director on 10th May, 2023. Accordingly, he has ceased
as an Independent Director of the Company, w.e.f. 11th May, 2023.
None of the Directors of the Company are disqualified under Section 164 (2) of the
Companies Act, 2013. Your directors have made necessary disclosures as required under
various provisions of the Companies Act, 2013.
Composition of Key Managerial Personnel
Pursuant to the relevant provisions of Section 203 of the Act, the Company has the
following KMPs:
| S.No |
Name |
Designation |
| 1. |
Mr. Aditya Kumar Modi |
Whole Time Director (Designated as Director - Operations) |
| 2. |
Mr. Sachin |
Chief Financial Officer |
| 3. |
Mr. Vimal Prasad Gupta |
Company Secretary & Compliance Officer |
DECLARATION BY INDEPENDENT DIRECTORS
All the Independent Director(s) have given declarations that they meet the criteria of
independence as laid down under Section 149(6) of the Companies Act, 2013 and Regulation
16(1)(b) of the Listing Regulations.
FORMAL EVALUATION OF BOARD, COMMITTEES AND DIRECTORS
Pursuant to the provisions of Section 134 of the Companies Act, 2013 and Regulation 17
of the SEBI (Listing Obligations and Disclosure
Requirements) Regulations, 2015, Independent Directors have at their meeting (without
participation of the Non-Independent Directors and Management) considered/evaluated the
Boards performance, Performance of the Chairman and other Non-Independent Directors.
The Board subsequently evaluated the performance of the Independent Directors as per
the criteria laid down and has recommended their continuation on the Board of the Company.
The working of its Committees (Audit, Nomination and Remuneration, Stakeholders
Relationship and Corporate Social Responsibility Committee) and Independent Directors
(without participation of the Director being evaluated) were also evaluated. The criteria
for performance evaluation have been detailed in the Corporate Governance Report.
NUMBER OF MEETINGS OF THE BOARD OF DIRECTORS
During the year 2022-23, four (4) Board Meetings were convened and held. Details of the
same are given in the Corporate Governance Report which forms part of this report. The
intervening gap between any two meetings was within the period prescribed under the Act,
and the Listing Regulations.
DIRECTORS RESPONSIBILITY STATEMENT
Pursuant to Section 134 (5) of the Companies Act, 2013 the Directors of your Company
declare as under:
(a) that in the preparation of the annual accounts, the applicable accounting standard
had been followed along with proper explanation relating to material departures;
(b) that 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 at the end of the
financial year and of the profit 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 this Act for safeguarding the
assets of the company and for preventing and detecting fraud and other irregularities;
(d) that the directors had prepared the annual accounts on a going concern basis;
(e) that the directors, had laid down and implemented internal financial controls to be
followed by the company and that such internal financial controls are adequate and were
operating effectively; and
(f) that 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.
STATEMENT REGARDING OPINION OF THE BOARD WITH REGARD TO INTEGRITY, EXPERTISE AND
EXPERIENCE OF THE INDEPENDENT DIRECTOR APPOINTED DURING THE YEAR
During the Year Mr. Salil Seth was appointed as Non-Executive Independent Director of
the Company w.e.f. 16th August 2022. In the opinion of Board Mr. Salil Seth is a Lawyer,
with high moral values, having rich experience in the matter of Corporate Laws.
SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS
During the year under review, there were no significant and material orders passed by
the Regulators or Courts or Tribunals that could impact the going concern status of the
Company and its future operations.
AUDITORS AND AUDITORS REPORT
STATUTORY AUDITOR
M/s. K. K. Jain and Co., Chartered Accountants (Firm Registration No.002465N), were
re-appointed as the Statutory Auditors of the Company in the 40th Annual General Meeting
of the Company till the conclusion of 45th Annual General Meeting.
AUDITORS QUALIFICATION
Notes to accounts referred to in the Auditors Report are selfexplanatory and
therefore, do not call for any further explanation. However, the following has not been
recognized as explained below:
a. Rs. 4,065.68 Lakhs against currency fluctuation of foreign currency loan has not
been recognized as the Company has filed Letters Patent Appellate Jurisdiction (LPA)
before the Divisional Bench of High Court of Jharkhand, Ranchi and it is hopeful that the
decision will be in favour of the Company.
b. Rs. 215.28 Lakhs recovered by South Eastern Coal Fields Ltd as penalty on account of
short lifting of coal quantity in terms of Fuel Supply Agreement as the matter has been
disputed by the Company under writ petition filed before the Honble High Court of
Chhattisgarh. The Company is hopeful that it would get an order in its favour in the said
proceedings.
c. Interest on unsecured loan taken from Promoters and other parties from 10.08.2013 to
31.03.2023 has not been taken into account as the Company will approach the lenders for
the waiver of the interest on unsecured loan.
d. Interest on Soft Loan taken from the Government of Jharkhand under the Industrial
Rehabilitation Scheme 2003 amounting to Rs. 6576.83 Lakhs from 10.08.2013 to 31.03.2023
has not been provided and is subject to representation for waiver.
INTERNAL AUDITORS
M/s. Sarat Jain & Associates, Chartered Accountants (Firm Registration No.014793C),
Noida, conducted Internal Audit periodically and submitted their reports to Audit
Committee. Their Repots have been reviewed by the Audit Committee.
COST AUDITORS
The Board of Directors, on the recommendation of the Audit Committee, have appointed
M/s. M.K. Singhal & Co., Cost Accountants (Firm Registration No.00074), as the Cost
Auditors to audit the cost
accounting records maintained by the Company for the financial year 2023-24 at a
remuneration of Rs.1,00,000/- plus taxes as applicable and reimbursement of out-of-pocket
expenses. As required under the Companies Act, 2013, a resolution seeking members
approval of the remuneration payable to the Cost Auditor forms part of the notice
convening the Annual General Meeting.
SECRETARIAL AUDITOR
M/s. Soniya Gupta & Associates, Company Secretaries (PCS COP No. 8136) were
appointed as the Secretarial Auditor of the Company in relation to the financial year
2022-23, in terms of Section 204 of the Companies Act, 2013.
The Secretarial Audit Report for financial year 2022-23 is attached as "Annexure -
A" with this report.
The observation in secretarial audit report are self-explanatory and therefore do not
call for any further explanation.
PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS UNDER SECTION 186
The Company has not given any loans, guarantees or made any investments under Section
186 of Companies Act, 2013 during the financial year 2022-23.
INTERNAL FINANCIAL CONTROL AND THEIR ADEQUACY
The Company has adopted policies and procedures for ensuring the orderly and efficient
conduct of its business including adherence to the Companys policies, safeguarding of its
assets, prevention and detection of frauds and errors, accuracy and completeness of the
accounting records and timely preparation of reliable financial disclosures.
RISK MANAGEMENT POLICY
As per Section 134(3) (n) of the Companies Act, 2013, the Company has adopted a Risk
Management Policy which is reviewed on a periodic basis in order to recognize and reduce
exposure to risks wherever possible. The Companys Risk management policies are based on
the philosophy of achieving the substantial growth and managing risks involved.
NOMINATION AND REMUNERATION POLICY
In accordance with the requirements under Section 178 of the Companies Act, 2013 and
Listing Regulations, the Committee formulated a Nomination and Remuneration policy to
govern the nomination/appointment, criteria for determining qualifications, positive
attributes, independence of a Director and remuneration of Directors, Key Managerial
Personnel, other employees and senior Management of the Company. Details of Composition of
Committee are given in the Corporate Governance Report.
The aforesaid policy can be accessed on the Companys website www.bsil.ore.in.
VIGIL MECHANISM / WHISTLE BLOWER POLICY
In compliance of Section 177 (9) & (10) of the Companies Act, 2013 and in terms of
Regulation 22 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations,
2015, the Company has set up a whistle blower policy which can be viewed on the Companys
website www.bsil.org.in. In terms of the said policy, the Directors and employees are
given direct access to the Chairman of the Audit Committee to report on alleged wrong
doings.
Your Company hereby affiirms that no Director/ employee has been denied access to the
Chairman of the Audit Committee and that no complaints were received during the year.
PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES
All the Related party Transactions entered by the Company during the financial year
were done in the ordinary course of business and at Arms Length. The Audit Committee
granted omnibus approval for the said related party transactions (which are repetitive in
nature) and the same was reviewed by the Audit Committee and the Board of Directors.
During the year, your Company had entered into materially significant transactions i.e.
transactions exceeding ten percent of the annual consolidated turnover with Related
Parties and the same are within the limits approved by the Shareholders of the Company.
Furthermore, suitable disclosures as are required under IND AS - 24 have been made in the
Notes to the Financial Statements.
The details of these transactions, as required to be provided under section 134(3) (h)
of the Companies Act, 2013 are disclosed in Form AOC-2 as Annexure-B and forms part of
this report.
The policy on materiality to regulate transactions between the Company and its related
parties, in compliance with the applicable provisions of the Act, and regulation 23 of the
Listing Regulations, as amended, is uploaded and can be viewed on the Company website
www.bsil.org.in.
EXTRACT OF THE ANNUAL RETURN
The extract of the Annual Return as per the provisions of Section 92 of Companies Act,
2013 read with Rule 12 of Companies (Management and Administration) Rules, 2014 will be
made available on the website of the Company at www. bsil.org.in.
PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES
Disclosure with respect to remuneration of Directors and employees as required under
section 197 (12) of the Companies Act, 2013 read with Companies (Appointment and
Remuneration of Managerial Personnel) Rules, 2014 and forming part of the Board report for
the year ended 31st March, 2023 are given in Annexure- C to this Report.
ENERGY CONSERVATION, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO
The information pertaining to conservation of energy, technology absorption, foreign
exchange earnings and outgo as required under Section 134 of the Companies Act, 2013 read
with rule (8)(3) of the Companies Account Rules, 2014 is enclosed in Annexure- D and forms
part of this report.
CORPORATE GOVERNANCE
A report on Corporate Governance along with a Auditors Certificate confirming
compliance of conditions of Corporate Governance as stipulated under Schedule V of the
SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 forms part of the
Annual report.
MANAGEMENT DISCUSSION ANALYSIS REPORT
In terms of Regulation 34 read with Schedule V of the SEBI (Listing Obligations and
Disclosure Requirements) Regulations, 2015, Management Discussion and Analysis Report is
annexed as Annexure-E and form part of this report.
LISTING OF SECURITIES
The equity shares of your Company continue to be listed on BSE Ltd. and the listing fee
for the Financial Year 2023-24 has been paid.
COMPLIANCE WITH SECRETARIAL STANDARDS
The Company has complied with the Secretarial Standards issued by the Institute of
Company Secretaries of India as approved by Central Government as required under Section
118(10) of the Companies Act, 2013.
DISCLOSURES IN RELATION TO THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION,
PROHIBITION AND REDRESSAL) ACT, 2013
During FY 2022-23, no complaint was received from any employee and hence no complaint
is outstanding as on March 31, 2023 for redressal.
DETAILS OF APPLICATION MADE OR ANY PROCEEDING PENDING UNDER THE INSOLVENCY AND
BANKRUPTCY CODE
During the year under review, no application is made nor any proceeding is pending
under the Insolvency and Bankruptcy Code, 2016.
THE DETAILS OF DIFFERENCE BETWEEN AMOUNT OF THE VALUATION DONE AT THE TIME OF ONE TIME
SETTLEMENT AND THE VALUATION DONE WHILE TAKING LOAN FROM THE BANKS OR FINANCIAL
INSTITUTIONS ALONG WITH THE REASONS THEREOF.
During the year under review, no one time settlement was made by the Company with any
Banks or Financial Institutions.
ACKNOWLEDGEMENT
Your directors take this opportunity to place on record their sincere thanks to all
stakeholders, various departments of Central Government, the Government of Bihar and
Jharkhand, Financial Institutions and Banks for their valuable assistance. Your directors
equally acknowledge the trust reposed by you in the Company. The Directors also wish to
place on record their appreciation for the all-round support and cooperation received from
the employees at all levels.
|
For & on behalf of the Board of Bihar Sponge Iron Limited |
| Place : New Delhi Date: 11-08-2023 |
Sd/- Umesh Kumar Modi Chairman & President DIN:00002757 |
+91-9892691696
