Gillanders Arbuthnot & Company Ltd Directors Report.

Dear Members,

Your Directors have pleasure in presenting the Annual Report on the affairs of the Company together with the Audited Financial Statements for the financial year ended on 31st March, 2019.

FINANCIAL RESULTS

The Companys financial performance, for the year ended on 31st March, 2019, is summarized below:

र In Lakhs

Particulars Standalone Consolidated
2018-19 2017-18 2018-19 2017-18
Revenue from Operations 70,537.19 62,678.96 75,115.31 66,479.93
Other Income 1,094.39 1,468.69 1,212.54 2,056.35
Profit/(Loss) before Depreciation, Finance Costs, Exceptional items and Tax Expense 5,475.81 5,187.75 7,746.03 7,024.95
Less: Depreciation/ Amortisation/ Impairment 1,694.16 1,615.77 2,023.06 2,423.98
Profit /(Loss) before Finance Costs, Exceptional items and Tax Expense 3,781.65 3,571.98 5,722.97 4,600.97
Less: Finance Costs 4,498.76 4,492.68 5,048.86 5,005.31
Profit /(Loss) before Exceptional items and Tax Expense (717.11) (920.70) 674.11 (404.34)
Add/(Less): Exceptional items - - - -
Profit/(Loss) before Tax Expense (717.11) (920.70) 674.11 (404.34)
Less: Tax Expense (Current & Deferred) 162.58 142.81 641.70 452.41
Profit/(Loss) for the year (1) (879.69) (1,063.51) 32.41 (856.75)
Total Comprehensive Income / (Loss) (2) (55.44) 349.04 (318.48) 349.04
Total (1+2) (935.13) (714.47) (286.07) (507.71)
Balance of Profit/(Loss) for earlier years 12,103.94 12,818.41 7,519.73 8,027.44
Balance carried forward 11,168.81 12,103.94 7,233.66 7,519.73
Earning per Ordinary Share (र)
Basic & Diluted (4.12) (4.98) (0.15) (4.01)

FINANCIAL PERFORMANCE AND REVIEW OF OPERATIONS

During the financial year ended on 31st March, 2019, your Company has reported a standalone EBITDA of 5,475.81 lakhs against 5,187.75 lakhs during the previous year. Total Standalone Income from Operations has increased to 70,537.19 lakhs as against 62,678.96 lakhs in the Previous Year. Operational matters have been discussed in detail under ‘Management Discussion and Analysis, in appropriate part of this Report.

DIVIDEND AND TRANSFER TO RESERVE

In view of inadequacy of profits for the financial year ended on 31st March, 2019, your Directors have not recommended any dividend for the year. The Board of Directors of your Company, has decided not to transfer any amount to the Reserves for the year under review.

INVESTMENT IN GILLANDERS MAURITIUS

During the year, the Company invested an amount of USD 5,30,000 (United States Dollar Five Lakhs thirty thousand only) by subscribing to 5,30,000 numbers of fully paid up equity shares of USD 1 each, at par, of Gillanders Holdings (Mauritius) Limited, a Wholly Owned Foreign Subsidiary.

QUALIFIED RE-ORGANISATION SCHEME OF ARRANGEMENT OF SUBSIDIARIES AT MALAWI

Namingomba Tea Estates Limited, Mafisi Tea Estates Limited and Group Holdings Limited, wholly owned subsidiaries of Group Developments Limited (GDL), a step down foreign subsidiary of the Company, undertook a qualified re-organization by way of amalgamating their respective whole businesses and undertaking with that of GDL through a mutually agreed upon scheme of arrangement. The said Scheme was approved by the Honble High Court at Malawi vide Order dated 18th December, 2018. On the said Scheme becoming effective, the name of GDL was changed to Namingomba Tea Estates Limited.

MANAGEMENT DISCUSSION AND ANALYSIS

Managements Discussion and Analysis Report for the year under review, as stipulated under Schedule V of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (‘SEBI Listing Regulations) is presented in a separate section forming part of the Annual Report. The industry structure, development, performance, opportunities, threats, outlook, risk and concerns, internal control systems and its adequacy, financial performance with respect to operational performance and material developments in human resource and industrial relations have been discussed in the paragraphs to follow.

Textile Division

During the year under review, the production was at 16,458 MT. The implementation of the Goods and Services Tax (GST) in the previous year continued to have adverse impact this year as well, as the value chain of the textile industry is dominated by the unorganized sector. The E-Way bill introduced during the year further increased the compliance at all levels which had its impact.

The year was marked with a very volatile crude oil market with Brent crude scaling up to USD 86 by October, 2018. The crude thereafter saw a huge fall to USD 50 by end of December, 2018. This resulted in huge fluctuation in prices of all the synthetic fiber. The increase in prices could not be fully passed on to the customer due to already poor market conditions.

Apart from the sluggish domestic market the exports in particular, of apparels was also not encouraging. Cotton crop during the crop year 2018-2019 is expected to be much lower than last year due to adverse weather condition and damages in cotton growing states.

Your division is continuously trying to increase its business of fancy and value added yarns, which is expected to improve the performance in the current year.

Tea Division

Global Tea Production in calendar year 2018 was higher, when compared to the previous calendar year. The production was higher due to increase in production in Kenya, Malawi and India. All India Tea production was 1338.6 million Kgs. in 2018 against 1321.8 million Kgs. in the previous calendar year.

Your Division reported a production of 9.9 million kgs, which is marginally higher than the production of 9.8 million kgs, as reported during the previous year. Production was impacted due to early closure of plucking, which was done in compliance with the Order of Tea Board. Price of bulk tea has increased by around 6 per kg, from previous year. The Division will continue its emphasis to increase production of orthodox and green tea in coming years in order to improve realization and profitability.

The export by the Division, during the year under review, has increased as compared to the previous year. The Division has penetrated into new potential markets and has also strengthened its presence in its existing markets.

Due to interim hike in the wages both in Assam and West Bengal, cost has increased, which has adversely affected the profitability. Profitability was also impacted by rising cost of other inputs like coal, fertilizer and agrochemicals etc. Due to increasing wages and shortage of labour, your Division is continuously in the process of automation of its operation viz., Tractor mounted spraying, plucking machine, plucking scissors, pruning machine, etc.

All eight factories of your Division are certified under ISO 22000-2005 and have Trust Tea Certificates. Your Division also enjoys RFA certification in its 3 Tea Estates located in the Golaghat district i.e. Gorunga, Dooria and Borkatonee Tea Estates.

During the current year, the prices as on date are not promising for CTC market due to initial high production and low demand. The Mombasa market, which primarily deals with African CTC are significantly down due to higher crop. Orthodox market has started on a buoyant note but its sustainability shall depend on the situation which may arise due to USAs sanction on Iran, a major orthodox market for Indian tea. However, your Directors expect with improved yield, quality and increase in exports, the Divisions performance shall be stable during the current year.

Engineering (MICCO) Division

MICCO is an established contractor in almost all the steel plants of India doing both EPC and Job contracting work. Few expansion programs in the private sector steel industries are in the pipeline as they have taken over few stressed steel plants & their revival plans have been initiated. MICCO is expected to bag few orders.

During the year under review, MICCO has successfully carried out the job of Dismantling of an age old Gasholder, MAN oil seal type Coke oven holder. This was a very challenging assignment and MICCO deployed a unique method for this dismantling work, which earned MICCO high appreciation from all concerned in Tata Steel, Jamshedpur. MICCO has also successfully commissioned a 60,000 m3 LD gasholder at Tata Steel, 80,000 m3 LD gasholders at JSPL, Angul.

During this year under review, MICCO has also bagged four new orders from JSW, Dolvy plant covering total order value of about 60 Crores, which involves structural, mechanical & piping work for Cyclone, Pellet Plant & Slag Granulation Plant. In the current year, there seems to be a global economic slowdown due to various factors. However, it is expected that with Indian governments plan to invest in infrastructure, outlook for steel industry seem to be positive. In spite of facing stiff competition due to lack of project jobs in public sector steel plants and cut throat pricing policy of customers in private sector, this division hopes to bag orders and expects stable performance.

Property Division

The Division has reported revenue of Rs 826.45 lakhs, which is 10.74% higher compared to previous year. Continuous efforts are being made to increase the occupancy of ‘Gillander House, the property which generates rental income for your Company. Your Directors are hopeful that the division will maintain its performance during the ensuing year. As already reported, this division follows fire safety policy and conducts fire safety drills at regular intervals. Due to slow recovery of the property market and huge property banks with all modern amenities in the vicinity, this division may face severe competition in the coming year.

Internal financial control systems and their adequacy

Your Company has adequate Internal Financial Control Systems in all areas of operation. Your Board has adopted policies and procedures for ensuring the orderly and efficient conduct of its businesses, including adherence to the Companys policies, safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records and the timely preparation of reliable financial disclosures. Internal Audits are conducted by Independent firms of Chartered Accountants and the reports are discussed with the operational heads by the CFO, Managing Director and Executive Director & CEO of the Company, and thereafter, placed before the Meetings of the Audit Committee of the Board of Directors. Representatives of the Statutory Auditors, Cost Auditors and Internal Auditors are also invited at the Meetings of the Audit Committee, as and when required. Corrective measures suggested at the Audit Committee Meetings are duly implemented.

The Audit Committee of the Board also reviews the adequacy of Internal Financial Control Systems at regular intervals. No fraud has been reported by the Statutory Auditor, Secretarial Auditor, Cost Auditor or Internal Auditors of the Company.

Human Resources and Industrial Relations

The Company has laid down the process for attracting, retaining and recognizing talent as it acknowledges the importance of good Human Resources. Company has cordial relation with employees and there is mutual respect and admiration for each other. The Directors wish to record their appreciation for the co-operation received from all employees. Industrial relation was good.

Caution Statement

Management Discussion and Analysis Report contains forward-looking statements, which are based on certain assumptions and expectations of future events. The Companys actual results and performance may differ from those projected due to unforeseen circumstances viz., political, economic, etc., over which the Company does not have any control. The Company assumes no responsibility to publicly amend, modify or revise any such statements on the basis of subsequent developments, information or events. Readers are advised to apply their diligence and independent judgment.

CONSOLIDATED FINANCIAL STATEMENTS

Consolidated financial statements for the financial year ended on 31st March, 2019, prepared as per the provisions of the Companies Act, 2013 (hereinafter referred to as ‘the Act), Rules framed therein and the applicable Accounting Standards are provided in the Annual Report.

SUBSIDIARY / ASSOCIATE COMPANIES

Gillanders Holdings (Mauritius) Limited, Mauritius, the Direct Foreign Subsidiary, reported a profit before tax of 19.38 lakhs, against 66.16 lakhs, during the previous year. No significant operational activities have been undertaken by the said Subsidiary during the year under review.

For the financial year ended on 31st March, 2019, Namingomba Tea Estates Limited, Malawi (NTEL), a step down Foreign Subsidiary, has reported a profit before tax of 1,371.83 lakhs, against a reported profit of 450.21 lakhs for the previous year.

NTEL is engaged in growing and processing of Tea and Macadamia. NTEL is a material step down subsidiary of the Company, and it has not sold, disposed off or leased any asset of more than 25% of the assets on an aggregate basis during the year under review.

Tea production of NTEL for the year under review was 2.53 Million kgs, compared to last years production of 2.40 million kgs.

During the year, Macadamia (N I H) production of NTEL was 2.22 million kgs against last years production of 1.87 million kgs. Further, we have done extension planting of 64.50 Hectares of macadamia and will continue extension in coming years.

During the year under review, your Company did not have any associate / joint venture. A separate section on the performance and financial position of the Subsidiaries in Form AOC-1 is part of the Annual Report and is annexed to the Report.

FIXED DEPOSITS

The Company is eligible to invite, accept or renew deposits under the provisions of the Act and Rules framed therein. As on 31st March, 2019 an amount of 4,251.52 lakhs was outstanding as fixed deposit from the public and Shareholders of your Company out of which 2,436.36 lakhs were accepted during the year. During the year under review, your Company has accepted deposits aggregating to 2,436.36 lakhs, which comprise of Fixed Deposit for 761.12 lakhs and Cumulative Deposit for 1,675.24 lakhs.

Matured Fixed Deposits for 5.74 lakhs remained unpaid and unclaimed as on 31st March, 2019, out of which Fixed Deposit for 0.40 lakh has been claimed and were repaid till date. There is no default in repayment of deposits and in payment of interest thereon.

All Fixed Deposits have been accepted in compliance with the requirements of the Companies Act, 2013 and Rules framed therein. No order has been passed by the National Company Law Tribunal / National Company Law Appellate Tribunal for extension of time for repayment nor has any penalty been imposed by the said Authorities.

DIRECTORS

Mr. A.K. Kothari (DIN 00051900) will retire in the ensuing 85th Annual General Meeting, and being eligible, offers himself, for re-appointment. The Board of Directors recommends his re-appointment.

The Company has received declarations from Dr. H. P. Kanoria (DIN 00286685), Mr. H. M. Parekh (DIN 00026530), Mr. N. Pachisia (DIN 00233768) and Mr. A. Baheti (DIN 0008094824) Independent Directors of the Company, that they meet the criteria of Independence and they have complied with the Code for Independent Directors, as prescribed both under the Act and SEBI Listing Regulations, and the Code of Conduct for Directors and Senior Management personnel, formulated by the Company.

Mr. N. Pachisias first term of 5 (five) consecutive years as an Independent Director of the Company shall come to an end on the conclusion of the ensuing 85th Annual General Meeting of the Company.

The sectioned term of consecutive 5 (five) years of Mr. H. M. Parekh and Dr. H. P. Kanoria, as Independent Directors of the Company, shall come to an end on the conclusion of the ensuing 85th Annual General Meeting of the Company. On conclusion of the ensuing 85th Annual General Meeting of the Company, Mr. H. M. Parekh and Dr. H. P. Kanoria shall retire as Directors of the Company.

On the recommendation of the Nomination and Remuneration Committee, the Board of Directors of the Company at their meeting held on 14th November, 2018, had appointed Mr. S. Srivastav, (DIN: 00237561), as an Additional Director (Independent) with immediate effect for a term of 5 years, subject to the approval of the members of the Company at the ensuing 85th Annual General Meeting. However, Mr. Srivastav vide his letter dated 6th February, 2019 had resigned from the Directorship of the Company due to his pre-occupation and inability to travel out of Mumbai at regular intervals.

Your Directors wish to place their sincere appreciation for the contribution made by Dr. H.P. Kanoria, Mr. H.M. Parekh and Mr. S. Srivastav during his tenure as a Director of the Company.

On the recommendation of the Nomination and Remuneration Committee, the Board of Directors of the Company at their meeting held on 28th May, 2019, have appointed:

(i) Mr. K. Ashok, (DIN: 02272068), as an Additional Director (Independent) with immediate effect for a term of 5 years, subject to the approval of the members of the Company at the ensuing 85th Annual General Meeting.

(ii) Mr. C.R. Prayag (DIN: 08463106), as an Additional Director (Independent) with immediate effect for a term of 5 years, subject to the approval of the members of the Company at the ensuing 85th Annual General Meeting.

(iii) Mr. N. Pachisia (DIN: 00233768) as an Independent Director of the Company for a sectioned term of 5 (five) consecutive years with effect from 9th August, 2019, subject to the approval of the members of the Company at the ensuing 85th Annual General Meeting.

Mr. Ashok and Mr. Prayag have given declarations that they meet the criteria of Independence, as prescribed both under the Act and SEBI Listing Regulations.

In view of the forthcoming retirement of Mr. H. M. Parekh and Dr. H. P. Kanoria, and in order to maintain the diversity of the Board and be compliant with the requirements of the Companies Act, 2013 and SEBI Listing Regulations, your Board recommends the appointment of Mr. K. Ashok and Mr. C.R. Prayag, as Independent Directors, for a term of 5 (five) consecutive years each. Mr. Ashok and Mr. Prayag have varied and rich experience in Tea and Textile Industry respectively. The proposed appointments would be beneficial to the Company and your Board recommends the same.

The Board also recommends the re-appointment of Mr. N. Pachisia, as an Independent Director for a term of 5 (five) consecutive years. The proposed appointments / re-appointment would be beneficial to the Company.

Details of aforesaid Directors seeking appointment / re-appointment are stated in the Explanatory Statement to the Notice convening the 85th Annual General Meeting of the Company.

The details of programmes for familiarization / training of 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 and related matters can be accessed on the website of the Company at the link: http://www.gillandersarbuthnot.com/pdf/ policy/Familiarization%20Programme%20for%20Independent%20Director.pdf

DIRECTORS RESPONSIBILITY STATEMENT

Your Directors state that:

a) in the preparation of the annual accounts for the financial year ended on 31st March, 2019, 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) such accounting policies have been selected 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 as at 31st March, 2019 and of the loss 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 annual accounts has been prepared on a ‘going concern basis;

e) internal financial controls has been laid down so that the same can be followed by the Company and that such internal financial controls are adequate and are operating effectively; and

f) proper systems has been devised to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively.

CORPORATE GOVERNANCE

The Company is committed to maintain the highest standards of Corporate Governance and adhere to the Corporate Governance requirements set out by Securities and Exchange Board of India. The Report on Corporate Governance confirming compliance with the conditions stipulated under the SEBI Listing Regulations, which forms part of the Annual Report, is attached to this Report. Certificates on Corporate Governance and on non disqualifications of Directors, as stipulated in the said Regulations, issued by CS Deepak Kumar Khaitan, Practising Company Secretary (FCS No. 5615), are also attached to this Report.

CONTRACTS AND ARRANGEMENTS WITH RELATED PARTIES

All contracts / arrangements / transactions entered by the Company during the financial year with related parties were in the ordinary course of business and on an arms length basis. No material contract / arrangement / transaction were entered into with any Related Party.

The Policy on related party transactions as approved by the Board may be accessed on the Companys website at the link:

http://www.gillandersarbuthnot.com/pdf/policy/rpt_policy_03jun19.pdf Your Directors draw attention of the Members to Note No. 46 to the standalone financial statements which set out related party disclosures as per the Act, SEBI Listing Regulations and the Accounting Standards.

CORPORATE SOCIAL RESPONSIBILITY

Your Company tries to address the needs of people by taking sustainable initiatives in the areas of promoting education, health care and setting up of homes and hostels for women and orphans. During the year under review, the Company could not undertake any CSR activity as the average net profit of the Company during the 3 immediately preceding financial years was negative.

The CSR Policy of the Company may be accessed on the Companys website at the link: http://www.gillandersarbuthnot. com/pdf/policy/Corporate%20Social%20Responsibility%20Policy.pdf

The Annual Report on CSR activities is annexed herewith and marked as Annexure I.

RISK MANAGEMENT

The Company has laid down a procedure to inform the Board Members, on a periodic basis, about the identified risks and the steps taken to mitigate and minimize the same. The Company has already identified and assessed major elements of risks, which may adversely affect the various Divisions of the Company. The Management reviews the identified risks, including assessment of the said risks and procedures, which are being implemented for the monitoring, mitigating and minimization of the said risks.

AUDITORS

Pursuant to Section 139 of the Companies Act, 2013, at the 81st Annual General Meeting (AGM) of the Company, M/s. Singhi & Co., Chartered Accountants, (Firm Registration No. 302049E) was re-appointed as the Statutory Auditor of the Company for a term of 5 (Five) consecutive years up to the conclusion of the 86th AGM of the Company to be held in the calendar year 2020.

Pursuant to Section 139 of the Companies Act, 2013, at the 83rd AGM of the Company, held on 1st September, 2017, M/s. Kothari & Company, Chartered Accountants, (Firm Registration No.- 309088E), was re-appointed as Branch Auditor of the Engineering (MICCO) Division of the Company, for a term of 5 (Five) consecutive years up to the conclusion of the 88th AGM of the Company to be held in the calendar year 2022.

M/s. Dutta Ghosh & Associates, Chartered Accountants (Firm Registration No.- 309088E) retired as Branch Auditors of the GIS Cotton Mill (unit of Textile Division) of the Company on the conclusion of the 84th AGM of the Company held on 30th July, 2018. The financial results of the said Unit are now being audited by M/s. Singhi & Co., Chartered Accountants, Statutory Auditor of the Company.

AUDITORS REPORT

Auditors Report to the Members of the Company does not contain any qualification or adverse remark. Financial Statements and the notes thereon are self-explanatory and need no further explanation.

COST AUDITORS

On the recommendation of the Audit Committee, and in compliance with the provision of Section 148 of the Act read with the Companies (Audit and Auditors) Rules, 2014, your Board has appointed the following Cost Auditors to conduct the audit of the cost records of the Company, as detailed below:

S.N. Division Cost Auditors for the financial year ending on 31st March, 2020
1 Tea M/s. B. Ray & Associates, Kolkata
2 Textile M/s. D. Sabyasachi & Co., Kolkata

M/s. D. Sabyasachi & Co., Cost Accountants, has been appointed as the lead cost auditor. In accordance with the provision of Section 148 of the Act read with the Companies (Audit and Auditors) Rules, 2014, appropriate Resolution seeking your ratification of the Remuneration of the said Cost Auditors appointed for the year ending on 31st March, 2020, is appearing in the Notice convening the 85th AGM of the Company.

SECRETARIAL AUDIT

The Board had appointed CS K. C. Dhanuka, Practising Company Secretary (FCS No. 2204), to conduct Secretarial Audit for the financial year ended on 31st March, 2019. The Secretarial Audit Report for the financial year ended on 31st March, 2019 is annexed herewith and marked as Annexure II to this Report. The Secretarial Audit Report does not contain any qualification / adverse remark / observation.

OTHER DISCLOSURES

Composition of Corporate Social Responsibility Committee

The Corporate Social Responsibility Committee of the Company, at present, comprises of Mr. H. M. Parekh as the Chairman of the Committee, Smt. P. D. Kothari and Mr. N. Pachisia as Members of the said Committee. For details relating to composition, number and date of meeting please refer to Clause XV of the report on Corporate Governance, which forms part of this Annual Report. The recommendations made by the Corporate Social Responsibility Committee were accepted by the Board.

Composition of Audit Committee

The Audit Committee of the Company, at present, comprises of Mr. H. M. Parekh as the Chairman of the Committee, Mr. A. K. Kothari, Mr. N. Pachisia and Mr. A. Baheti as Members of the said Committee. For details relating to composition, number and dates of meetings please refer to Clause III of the report on Corporate Governance, which forms part of this Annual Report. The recommendations made by the Audit Committee were accepted by the Board.

Composition of Nomination and Remuneration Committee

The Nomination and Remuneration Committee of the Company, at present, comprises of Mr. H. M. Parekh as the Chairman of the Committee, Smt. P. D. Kothari, Dr. H. P. Kanoria and Mr. N. Pachisia as Members of the said Committee. For details relating to composition, number and dates of meetings please refer to Clause IV of the report on Corporate Governance, which forms part of this Annual Report. The criteria for determining qualifications, positive attributes, independence of a Director, performance Evaluation of Board, Committees and the Directors are laid down under the Nomination and Remuneration Policy of the Company.

The performance Evaluation of the Board, its Committees and of individual Directors was made by way of structured questionnaire and the Directors were satisfied with the Evaluation process. Remuneration Policy for Directors, Key Managerial Personnel and other employees may be accessed on the Companys website at the link: http://www. gillandersarbuthnot.com/pdf/2019/NRC-Policy.pdf The recommendations made by the Nomination and Remuneration Committee were accepted by the Board.

Composition of Stakeholders Relationship Committee

The Stakeholders Relationship Committee of the Company, at present, comprises of Mr. H. M. Parekh as the Chairman of the Committee, Mr. A. K. Kothari, Smt. P. D. Kothari and Mr. Mahesh Sodhani as Members of the said Committee. For details relating to composition, number and date of meeting please refer to Clause VIII(F) of the report on Corporate Governance, which forms part of this Annual Report. The recommendations made by the Stakeholders Relationship Committee were accepted by the Board.

Whistle Blower Policy

The Company has in place a Whistle Blower Policy in compliance with the provisions of the Act and SEBI Listing Regulations. The said Policy provides for a formal vigil mechanism for all employees and Directors of the Company, to report to the Chairman of the Audit Committee of the Company, genuine concerns or grievances about the unethical behavior, actual or suspected fraud or violation of the Companys Code of Conduct. The Policy also provides adequate safeguards against victimization. The whistle blower policy may be accessed on the Companys website at the link: http://www. gillandersarbuthnot.com/pdf/policy/Whistle-Blower-Policy-0519.pdf. Your Board affirms that no person has been denied access to the Chairman of the Audit Committee.

Meetings of the Board

Five Meetings of the Board of Directors were held during the year. For details relating to composition and dates of meetings please refer to Clause II of the report on Corporate Governance, which forms part of this Annual Report.

Particulars of Loans given, Investments made, Guarantees given and Securities provided

During the year under review, the Company has not given any loan, guarantee and security. However, the Company has invested an amount of USD 5,30,000 (United States Dollar five Lakhs thirty thousand) by subscribing to the fully paid up Equity Shares of USD 1 each, at par, of Gillanders Holdings (Mauritius) Limited. For details, please refer to note no. 46 of notes to accounts.

Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo

The particulars relating to conservation of energy, technology absorption, foreign exchange earnings and outgo, as required under the Act, is annexed herewith and marked as Annexure III.

Extract of Annual Return

Extract of Annual Return of the Company is annexed herewith and marked as Annexure IV. The Annual Return of the Company may be accessed on the Companys website at the link: https://www.gillandersarbuthnot.com/inv_info.php.

Particulars of Employees and related disclosures

No employee draws Remuneration in excess of the limits provided in the Companies (Appointment and Remuneration of Managerial Personnel) Amendment Rules, 2016. Rule 5(2) of the said Rules state that the Boards Report shall include a statement showing the names of top ten employees in terms of Remuneration drawn and the name of every employee, who, if employed throughout the financial year, was in receipt of Remuneration for that year, which, in the aggregate, was not less than 102 lakhs and if employed, for part of the financial year, was in receipt of Remuneration for any part of that year, at a rate which, in the aggregate, was not less than 8.50 lakhs per month.

Disclosures pertaining to Remuneration and a statement showing the names of top ten employees in terms of Remuneration drawn, as required under Section 197(12) of the Act read with Rule 5(1), 5(2) & 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, as amended, is annexed herewith and marked as Annexure V.

Credit Ratings

Your Company has obtained credit ratings for bank loans and fixed deposit scheme from Care Ratings Limited, Mumbai (CARE). CARE vide its letter dated 2nd January, 2018 had given CARE BBB+, Negative, rating for the Companys long term bank facilities and fixed Deposit Scheme.

Thereafter, CARE vide their letter dated 26th November, 2018 have made an upward revision in the ratings to CARE BBB+, Stable, for the Companys long term bank facilities and fixed Deposit Scheme. These ratings are valid for a period of one year from the date of the letter, until otherwise, revised.

Secretarial Standards

The Company is in compliance with applicable Secretarial Standards issued by the Institute of Company Secretaries of India, New Delhi.

Equity Shares in the Suspense Account

As on 1st April, 2018, 2,065 aggregate number of shareholders representing 2,13,678 fully paid up Ordinary shares were lying in the suspense account. During the financial year 2018-2019, 18,104 shares aggregating 229 shareholders were transferred to the suspense account. As on 31st March, 2019, 2,31,782 numbers of Ordinary shares aggregating 2,294 shareholders were lying in the suspense account. The voting rights on these shares remains frozen till the rightful owner of such shares claims the same.

Unpaid/Unclaimed Dividends Transfer to Investor Education and Protection Funds (IEPF)

During the year under review, 14,18,985/- was transferred to the IEPF in respect of financial year 2010-2011. Shares in respect of which dividend has not been paid or claimed for seven consecutive years or more i.e. relating to the financial year 2010-2011, were required to be transferred to IEPF of the Central Government by 15th October, 2018. The Company had sent notices to all shareholders whose shares were due to be transferred to the IEPF Authority and subsequently have transferred 18,104 numbers of shares to IEPF.

Shareholders who have not yet encashed their dividend warrant(s) for the financial year 2011-2012 or any subsequent financial years are requested to submit their claims to the Registered Office of the Company for revalidation/issue of duplicate dividend warrants quoting reference of their Ledger Folio numbers. Unclaimed dividend for the year 2011-2012 is due for transfer to IEPF later during the year.

Material Changes

There have been no material changes and commitments affecting the financial position of the Company since the close of the financial year i.e. 31st March, 2019. Further, there has been no change in the nature of business of the Company.

Disclosure pertaining to Sexual Harassment of Women

The company has in place a Policy for Prevention of Sexual Harassment at the Workplace in line with the requirements of the Sexual Harassment of Women at the Workplace (Prevention, Prohibition & Redressal) Act, 2013. Internal Complaints Committee (ICC) has been set up to redress complaints received regarding sexual harassment. All employees (permanent, contractual, temporary, trainees) are covered under this policy. No complaint was pending at the beginning of the year, no complaint was received during the year, hence, no complaint was pending at the end of the year.

General

Your Directors states that no significant or material orders were passed by the Regulators or Courts or Tribunals or quasi judicial body, which may impact the going concern status and Companys operations in future.

ACKNOWLEDGEMENT

The Directors would like to record their appreciation for the co-operation and support received from the employees, shareholders, banks, government agencies and all stakeholders.

For and on behalf of the Board
Place: Kolkata A. K. Kothari
Date: 28th May, 2019 Chairman