GB Global Ltd Directors Report.
The Directors present the 35th Annual Report and the Financial Statements of the Company for the year ended 31st March, 2019.
|2019 - 2018|
|Profit/(Loss) before Finance Cost, Depreciation &Amortisation and Taxation||-136.15||-58,015.01|
|Less: 1. Finance Cost||52.61||16,806.69|
|2. Depreciation &Amortisation||3,917.60||5,895.78|
|Profit/ (Loss) Before Taxation||-3,834.06||-80,717.48|
|Less: Provision for Taxation|
|Net Profit/(Loss) for the Year||-3,273.59||-79,909.57|
|Less: Income Tax paid for earlier year||963.86|
|Profit/(Loss) after Taxation||-4,237.45||-79,909.57|
|Add: Other Comprehensive Income||-51.68|
|Total Comprehensive Income||-4,289.13||-79,909.57|
|Add : Balance of Profit (Loss) from earlier years||1,12,013.69||-32,104.12|
|Amount available for Appropriations||-1,16,302.82||-1,12,013.69|
|Add: Transfer from Debenture Redemption Reserve|
|Tax on distributed Profits|
|Balance carried forward||-1,16,302.82||-1,12,013.69|
Notes: Previous years figures have been reclassified/regrouped wherever necessary, to correspond with those of the current year.
COMPANY PERFORMANCE AND BUSINESS OVERVIEW
The total revenue from operations for the year 2018-19 was Rs. 29,236.74 Lakh. The total loss before tax was Rs. 3,834.06 Lakh. The Corporate Insolvency Resolution Process (CIRP) was initiated by the lenders of the Company and Resolution Professional (RP) was appointed to look after the business of the Company and for better half RP managed the operations of the Company.
Further discussion of operations for the year ended 31st March, 2019 is provided in the Management Discussion and Analysis Report, which is presented in a separate section forming part of this Annual Report.
SIGNIFICANT EVENTS DURING THE FINANCIAL YEAR 2018-19
Corporate Insolvency Resolution Process (CIRP) had been initiated under the Insolvency and Bankruptcy Code, 2016 by the National Company Law Tribunal (NCLT), Mumbai vide its order dated 29th September, 2017 owing to defaults in repayment of principal debt and interest thereon by the Company. Further, vide the above mentioned NCLT order and pursuant to Section 17 of the IBC, the powers of the Board of Directors of the Company stood suspended and such powers were vested with the Interim Resolution Professional, Mrs. Charu Desai (IP Registration no. IBBI/IPA-001/IP-P00434/2017-18/10757). Her appointment was subsequently confirmed by the Committee of Creditors (COC) as the Resolution Professional (the "RP"). Accordingly, Mrs. Charu Desai in her capacity as RP took control and custody of the management and operations of the Company with effect from 11th October, 2017.
On 9th July, 2018, in accordance with Section 30(6) of the IBC, a resolution plan as approved by the COC with the requisite majority as per Section 30(4) of the IBC, was filed and approved by the Honble National Company Law Tribunal vide its order dated 30th November, 2018. As per the Resolution Plan as submitted by M/s. Formation Textiles LLC (FTL) which authorised FTL to appoint new Directors on the Board of the Company so as to Constitute the new Board of Directors in compliance with applicable provisions of the Companies Act, 2013 read with SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.
Pursuant to the Resolution Plan as submitted by M/s. Formation Textiles LLC (FTL) and as approved by the Honble National Company Law Tribunal (NCLT) vide its order dated 30th November, 2018 (approved Resolution Plan), all the Directors associated with the Mandhana Industries Limited (Company) as on the date of passing the order by the NCLT, shall be deemed to have been resigned from their respective office with effect from the date of reconstitution and takeover of management by the newly constituted Board of Directors.
FTL has vide its letter dated 30th January, 2019 informed the Company of the appointment New Directors of the Company.
Consequent to the taking over of control and management of the Company by the re-constituted Board of Directors, Mr. Purushottam Mandhana, Mr. Manish Mandhana and Mr. Monarch Gandhi shall deemed to have been resigned and vacated their office from the Company with effect from 31stJanuary, 2019.
MATERIAL CHANGES AND COMMITMENTS, IF ANY, AFFECTING THE FINANCIAL POSITION OF THE COMPANY WHICH HAVE OCCURRED BETWEEN THE END OF THE FINANCIAL YEAR OF THE COMPANY TO WHICH THE FINANCIAL STATEMENTS RELATE AND THE DATE OF THE REPORT
Except the changes occurred during and subsequent to the financial year 2018-19, stated hereinabove, no material changes and commitments have occurred after the close of the year till the date of this report, which affect the financial position of the Company.
In view of the losses, your Company does not recommend any dividend for the year under review.
TRANSFER TO RESERVE
Reports on Corporate Governance and Management Discussion and Analysis, in accordance with SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("Listing Regulations"), along with a certificate from Auditors regarding compliance of the Corporate Governance are given separately in this Annual Report.
Your Company has not accepted any Public deposits under Chapter V of Companies Act, 2013.
DIRECTORS AND KEY MANAGERIAL PERSONNEL
M/s. Formation Textiles LLC (FTL) has submitted Resolution Plan as approved by the Honble National Company Law Tribunal (NCLT) vide its order dated 30th November, 2018 (approved Resolution Plan) and pursuant to of the approved Resolution Plan, all the Directors associated with the Mandhana Industries Limited (Company) as on the date of passing the order by the NCLT, shall be deemed to have been resigned from their respective office with effect from the date of reconstitution and takeover of management by the newly constituted Board of Directors.
FTL has vide its letter dated 30th January, 2019 informed the Company of the appointment following persons asthe Directors of the Company:
|Sr. No.||Name of the Director||Category of Director|
|1.||Mr. Piyush Viradia||Non-Executive Director|
|2.||Ms. Cynthia Dibartolo||Non-Executive & Independent Director|
|3.||Mr. Todd Robinson||Non-Executive & Independent Director|
|4.||Mr. Lawrence Steckman||Non-Executive & Independent Director|
|5.||Mr. Nimesh Patel||Non-Executive Director|
|6.||Ms. Alka Patel||Non-Executive Director|
|7.||Mr. Chirayu Chhibber||Non-Executive & Independent Director|
|8.||Mr. Piyush Doshi||Non-Executive & Independent Director|
Consequent to the taking over of control and management of the Company by the re-constituted Board of Directors Mr. Purushottam Mandhana, Mr. Manish Mandhana and Mr. Monarch Gandhi shall deemed to have been resigned and vacated their office from the Company with effect from 31stJanuary, 2019.
Accordingly, as the Board of the Company has been reconstituted and Control and Management has been taken over by the new Board of Directors in compliance with applicable provisions of the Companies Act, 2013 read with SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 in board meeting held on 31stJanuary, 2019 effective from 30th January, 2019.
Mr. Piyush Doshi has been appointed as the Managing Director of the Company pursuant to the provision of Section 2(54), Section 196 of the Companies Act, 2013 (Act) for a period of 3 years in the board meeting held on 14th February, 2019.
The Designation of Ms. Alka Patel has been re-categorized from Non-Executive Director to the Non-Executive& Independent Director of the Company. A declaration of Independence has been received from her pursuant to Section 149(7) of the Companies Act, 2013.
Mr. Deepak Dhumal (DIN: 07897648) was appointed as an Additional Director of the Company pursuant to the provision of Section 161 of the Companies Act, 2013 and then appointed as an Executive Director of the Company pursuant to the provision of Section 2(94), Section 196 of the Companies Act, 2013 (Act) for a period of 3 years in the board meeting held on 14th February, 2019.
However, Mr. Dhumal has resigned from the Board of Directors w.e.f. 15th March, 2019.
Mr. Ashok Das (DIN: 08419056) has been appointed as an Additional Director of the Company pursuant to the provision of Section 161 of the Companies Act, 2013 and then appointed as an Executive Director of the Company pursuant to the provision of Section 2(94), Section 196 of the Companies Act, 2013 (Act) for a period of 3 years in the board meeting held on 23rd May, 2019.
Ms. Cynthia Dibartolo and Mr. Lawrence Steckman Non-executive & Independent Directors have resigned and ceased to be Directors of the Company with effect from 25th July, 2019 on account of their pre-occupation.
Brief details of Directors proposed to be appointed/reappointed as required under Regulation 36(3) of Listing Regulations are provided in the explanatory statement annexed to the notice of the AGM.
Mr. Hemant Gupta has been appointed as the Chief Financial Officer (CFO) of the Company, and Chief Operating Officer (COO) of the Company with effect from 1st June, 2019 on the board meeting held on 23rd May, 2019.
Ms. Divya Manish Trivedi has resigned as Company Secretary and the Compliance Officer of the Company effective from 25th February, 2019 and Mr. Vinay Sampat was appointed as the Company Secretary and the Compliance Officer of the Company with effect from 1st June, 2019 on the board meeting held on 23rd May, 2019.
Evaluation of performance of Directors was not undertaken during this financial year on account of CIRP initiated against the Company w.e.f. 29th September, 2017, where the powers of the Board of Directors (including evaluating the performance of Board, its Committee and individual Directors) stood suspended. The Board of the Company has been reconstituted in board meeting held on 31st January, 2019 effective from 30th January, 2019. Therefore, the evaluation of the performance of the Board of Directors and of its Committees and individual Directors were not undertaken during the financial year 2018-19.
NUMBER OF MEETINGS OF THE BOARD OF DIRECTORS
Two (2) Board Meetings were convened and held during the financial year 2018-19 (the powers of the Board of Directors stood suspended on account of initiation of CIRP against the Company and after the approval of resolution plan by Committee of Creditors (COC) and Honble National Company Law Tribunal vide its order dated 30th November, 2018, the Board reconstituted with effect from 30th January, 2019 in board meeting held on 31st January, 2019). Details of meetings of the Board and its Committees alongwith the attendance of the Directors therein have been disclosed in the Corporate Governance Report. (Annexed herewith)
VIGIL MECHANISM / WHISTLE BLOWER POLICY FOR DIRECTORS AND EMPLOYEES
The Company has established a Vigil Mechanism, which includes a Whistle Blower Policy, for its Directors and Employees, to provide a framework to facilitate responsible and secure reporting of concerns of unethical behavior, actual or suspected fraud or violation of the Companys Code of Conduct & Ethics. The Whistle Blower Policy is posted on the website of the
Company and the web-link to the same is https://www.mandhana.com/codes-of-conduct-policies.php
Consequent to the reconstitution of the Board of Directors in board meeting held on 31st January, 2019 and pursuant to the provisions of Regulation 18 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, ("Listing Regulations") Section 177 of the Companies Act, 2013 read with Companies (Meeting of Board and its Powers) Rules, 2014, the following members are the members of audit committee reconstituted in the board meeting held on 14th February, 2019 on account of change in directorship.
|Sr. No.||Name of the Member||Designation|
|1.||Ms. Alka Patel||Chairperson|
|2.||Ms. Cynthia Dibartolo @||Member|
|3.||Mr. Todd Robinson||Member|
|4.||Mr. Chirayu Chhibber||Member|
|5.||Mr. Piyush Doshi||Member|
@ Ms. Cynthia Dibartolo has resigned with effect from 25th July, 2019.
Further details on the Audit Committee are provided in the Corporate Governance Report. (Annexed herewith)
NOMINATION AND REMUNERATION POLICIES
The Board of Directors has formulated a Policy which lays down a framework for selection and appointment of Directors and Senior Management and for determining qualifications, positive attributes and independence of Directors.
The Policy also provides for remuneration of Directors, Members of Senior Management and Key Managerial Personnel.
Details of the Key Features of Nomination and Remuneration Policy are given under Annexure - A to this Report
RISK MANAGEMENT POLICY
The Company has in place a Risk Management framework to identify, measure and mitigate business risks and threats. This framework seeks to create transparency, minimize adverse impact on the business objective and enhance the Companys competitive advantage.
This risk framework thus helps in managing market, credit and operations risks and quantifies exposure and potential impact at a Company level.
PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS
No loans, guarantees or Investments covered under sections 186 of the Companies Act, 2013, have been given or provided during the year. Details of the investments made and loans outstanding as of 31st March, 2019, pursuant to Section 186 of the Act are provided under note nos. 7 and 8 of the Financial Statements (annexed herewith).
All contracts/arrangements/transactions entered by the Company during the financial year with related parties were in ordinary course of business and on arms length basis. During the year, the Company had not entered into any contract/arrangement/ transaction with related parties which could be considered material under Regulation 23 of Listing Regulation. Accordingly, the disclosure of Related Party Transactions as required under Section 134(3)(h) of the Companies Act, 2013 in Form AOC - 2 is not applicable. The Policy on materiality of related party transactions and dealing with related party transactions as approved by the Board may be accessed through the following link: http://www.mandhana.com/investorRelations.php. Your Directors draw attention of the members to Note No. 33 to the financial statements which set out related party disclosures.
Prior omnibus approval is obtained on an annual basis for the transactions with related parties which are of a foreseeable and repetitive nature. The transactions entered into pursuant to the omnibus approval so granted and a statement giving details of all transactions with related parties are placed before the Audit Committee and Board of Directors for their review on a periodic basis.
Remuneration to Directors and Key Managerial Personnel
i. The percentage increase in remuneration of each Director and Company Secretary during FY 2018-19 and ratio of the remuneration of each Director to the median remuneration of the employees of the Company for FY 2018-19 are as under:
|Sr. No.||Name of Director /KMP and Designation||Remuneration of Director/ KMP for FY 2018-19 (In Rs.)||% increase/ decrease in remuneration in FY 2018-19||Ratio of remuneration of each Whole-Time Director to median remuneration of employees|
|1.||Mr. Piyush Viradia #|
|2.||Mr. Piyush Doshi tt|
|3.||Mr. Todd Robinson #||40,000/-||N.A.||N.A.|
|Non-Executive & Independent Director|
|4.||Ms. Cynthia Dibartolo # @|
|Non-Executive Independent Director||40,000/-||N.A.||N.A.|
|5.||Mr. Lawrence Steckman # @|
|Non-Executive & Independent Director||40,000/-||N.A.||N.A.|
|6.||Mr. Nimesh Patel #|
|7.||Ms. Alka Patel #|
|Non-Executive & Independent Director||40,000/-||N.A.||N.A.|
|8.||Mr. Chirayu Chhibber #|
|Non-Executive & Independent Director||60,000/-||N.A.||N.A.|
|9.||Mr. Deepak Dhumal||1,61,290/-||N.A.||26:1|
|Executive Director $|
|10.||Mrs. Divya Trivedi *|
|Company Secretary & Compliance Officer||2,75,000/-||N.A.||N.A.|
# Appointed in board meeting held on 31stJanuary, 2019 effective from 30th January, 2019.
@ Ms. Cynthia Dibartolo and Mr. Lawrence Steckman have resigned and ceased to be Directors of the Company with effect from 25th July, 2019.
Ms. Divya Manish Trivedi has resigned as Company Secretary and the Compliance Officer of the Company effective from 25th February, 2019
Mr. Deepak Dhumal was appointed on 14th February, 2019 as Executive Director and resigned on 15th March, 2019.
i. Remuneration paid to KMP includes Salary, allowances, companys contribution to provident fund and monetary value of perquisites, if any. The remuneration paid to Non-Executive and/or Independent Directors comprises of sitting fees only. ii. The median remuneration of employees of the Company during FY 2018-19 was Rs.1,38,060./-;
iii. In the financial year under review, there was an increase of 4.84 % in the median remuneration of employees;
iv. There were 3,376 permanent employees on the rolls of the Company as on 31st March, 2019;
v. Average percentage increase in the salaries of employees other than the managerial personnel in the FY 2018-19 was 11.45 % as compared to FY 2017-18.
vi. It is hereby affirmed that the remuneration paid is as per the Remuneration Policy for Directors, Key Managerial Personnel and other Employees.
Details of employee remuneration as required under
provisions of Section 197 of the Companies Act, 2013 and Rule 5(2) & 5(3) of Companies (Appointment and
Remuneration of Managerial Personnel) Rules, 2014 is
provided in a separate statement and forms part of the Annual Report. Further, this report is being sent to the
Members excluding the said statement. The said statement is available for inspection of members at the Registered/Corporate Office of the Company during
working hours upto the date of the Annual General Meeting and shall be made available to any shareholder
on request. The said statement is also available on the website of the Company the weblink to which is
STATUTORY AUDITOR AND AUDITORS REPORT
In accordance with Section 139 of the Companies Act, 2013, the Members of the Company in its 32nd Annual
General Meeting, held on 30th December, 2016, have appointed M/s. KPND & Co., Chartered Accountants (FRN: 133861W) as the Statutory Auditors of the Company to hold office till the conclusion of the 37th Annual General Meeting of the Company to be held in calendar year 2021.
However, as envisaged in resolution plan, M/s. KPND & Co., Chartered Accountants (FRN: 133861W) resigned as the Statutory Auditors of the Company and M/s. C N K & Associates LLP, Chartered Accountants, Mumbai were appointed in casual vacancy as Statutory Auditors of the Company in place of M/s. KPND & Co., Chartered Accountants.
The Auditors Report and notes to the financial statements referred in the Auditors Report are self- explanatory and therefore do not call for any further comments under Section 134 of the Companies Act, 2013. The Auditors Report is enclosed with the financial statements in this Annual Report. There is no incident of fraud requiring reporting by the auditors under Section 143(12) of the Companies Act 2013.
COST AUDITOR AND COST AUDIT REPORT
M/s. C.B. Modh & Co., Cost Accountants have been duly
appointed as Cost Auditors for conducting Cost Audit in respect of products manufactured by the Company which are covered under the Cost Audit Rules for current financial year ending 31st March, 2019. As required by Section 148 of the Companies Act, 2013, necessary
resolution has been included in the Notice convening the 35th Annual General Meeting, seeking ratification by
Members to the remuneration proposed to be paid to the Cost Auditors for the financial year ending 31st March, 2020.
The Company is in process of filing the Cost Audit Report, for the financial year ended 31st March, 2019 with the
SECRETARIAL AUDIT REPORT
Pursuant to the provisions of Section 204 of the Companies Act, 2013, and the Rules made thereunder, the Company has appointed Mr. Nitin R. Joshi, Practicing Company Secretary (Certificate of Practice No. 1884 and Membership No.FCS-3137) as the Secretarial Auditor of the Company. The Secretarial Audit Report is annexed as Annexure- D and forms an integral part of this Report. The Company has complied with all the applicable secretarial standards.
The Company has made timely submissions of all the disclosures to the Stock Exchanges pursuant to the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, (Listing Regulations).
The Secretarial Audit Report does not contain any other qualification, reservation or adverse remark. The statements referred in the Secretarial Audit Report are self-explanatory and therefore do not call for any comments under Section 134 of the Companies Act, 2013.
CORPORATE SOCIAL RESPONSIBILITY
The Company is not falling under any of the applicability criterias of CSR as mentioned under the provisions of Section 135 of the Companies Act, 2013 as amended by the Companies Amendment Act, 2017. Reporting as required under the aforesaid section, for the FY 2018-19, is enclosed as Annexure -B.
SUBSIDIARIES, JOINT VENTURES AND ASSOCIATE COMPANIES
The Company has no subsidiary, Joint Venture and Associate Company as on 31st March, 2019.
ADEQUACY OF INTERNAL FINANCIAL CONTROLS
The Company has adequate internal financial controls in place with reference to financial statements. These are continually reviewed by the Company to strengthen the same wherever required. The internal control systems are supplemented by internal audit carried out by an independent firm of Chartered Accountants and periodical review by management. The Audit Committee of the Board addresses issues raised by both, the Internal Auditors and the Statutory Auditors.
DIRECTORS RESPONSIBILITY STATEMENT
The financial statements are prepared in accordance with Indian Accounting Standards (Ind AS) under the historical cost convention on accrual basis except for certain financial instruments, which are measured at fair values, the provisions of the Act (to the extent notified) and guidelines issued by the Securities and Exchange Board of India (SEBI). The Ind AS are prescribed under Section 133 of the Companies Act, 2013 (the Act), read with Rule 3 of the Companies (Indian Accounting Standards) Rules, 2015 and Companies (Indian Accounting Standards) Amendment Rules, 2016. The Company has adopted all the Ind AS standards and the adoption was carried out in accordance with applicable transition guidance. Accounting policies have been consistently applied except where a newly issued accounting standard is initially adopted or a revision to an existing accounting standard requires a change in the accounting policy hitherto in use.
i) In the preparation of the annual accounts for the financial year ended 31st March, 2019, the applicable Accounting Standards have been followed along with proper explanation relating to material departures;
ii) Accounting policies have been selected and applied consistently and judgments and estimates made that were 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 the year under review;
iii) Proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provision of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
iv) The annual financial statements have been prepared on a going concern basis;
v) Internal financial controls to be followed by the Company have been laid down and ensured that such internal financial controls are adequate and operating effectively; and
vi) Proper systems have been devised to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively.
PARTICULARS OF ENERGY CONSERVATION,
TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO
Particulars of Conservation of Energy, Technology
Absorption and Foreign Exchange Earnings and Outgo as per section 134(3)(2) of the Companies Act, 2013, read with the Companies (Accounts) Rules, 2014 for the year ended 31st March, 2019 are provided under Annexure C to this report.
WEB-LINK OF THE ANNUAL RETURN
Pursuant to the provisions of Section 92(1) of the Companies Act, 2013 as amended by the Companies Amendment Act, 2017, a copy of the Annual Return in Form No. MGT-9 is uploaded on the website of the Company and the web link of which is: https://www.mandhana.com/annual-reports.php
During the year under review, the number of equity shares existing as on record date have been reduced to 1/10th (One Tenth) and any fractional share arising out such reduction would be rounded to 1 (One) share pursuant to the terms of the Resolution Plan.
Consequently, the share capital of the Company on the date of re-listing i.e. 4th June, 2019 stand reduced to Rs. 3,31,42,950/- consisting of 33,14,295 equity shares of the Rs.10/- each.
Members of the Company have passed Special Resolution for change of name of the Company from "Mandhana Industries Limited" to "GB Global Limited" and consequent amendment to Memorandum of Association and Articles of Association and other documents of the Company through Postal Ballot on 9th July, 2019. In this regard, the Company has filed the relevant form with Ministry of Corporate Affairs/ Registrar of Companies and is awaiting approval.
No disclosure or reporting is required in respect of the following items as they were not applicable or there were no transactions on these items during the year under review:
1. The details relating to deposits, covered under Chapter V of the Act, since neither has the Company accepted deposits during the year under review nor were there any deposits outstanding du ring the year.
2. Details relating to issue of equity shares including sweat equity shares, stock options, and shares with differential rights as to dividend, voting or otherwise, since there was no such issue of shares.
3. None of the Whole-Time Directors of the Company received any remuneration or commission from any of its subsidiaries.
Further, during the year under review, there were no cases filed under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.
The Management hereby take this opportunity to thank the Shareholders, Financial Institutions, Banks, Customers, Suppliers, Regulators and Government Authorities- Central, State & Local.
The Management also wish to place on record their appreciation of the employees at all levels for their hard work, dedication and commitment.
|For MANDHANA INDUSTRIES LIMITED|
|Piyush Vrajlal Doshi|
|DIN : 07597924|
|Date: 13th August, 2019|
|Plot No. C-3, M.I.D.C. Tarapur Industrial Area,|
|Boisar, Dist. Palghar 401506|