To the Members of Gitanjali Gems Limited
The Directors are pleased to present the 31st Annual Report and the
Audited Statement of Accounts for the year ended 31st March 2017:
FINANCIAL RESULTS
(Rs. in Lakhs)
|
Standalone |
Consolidated |
| Particulars |
2016-17 |
2015-16 |
2016-17 |
2015-16 |
| Sales & Other Income |
10,61,126.93 |
10,81,559.30 |
16,83,143.97 |
14,15,920.86 |
| Expenditure |
10,07,790.87 |
10,29,232.61 |
15,90,113.13 |
13,25,050.28 |
| Finance Cost |
47,766.87 |
46,352.15 |
69,394.27 |
72,986.54 |
| Depreciation & Amortization Expenses |
1,653.16 |
1,988.05 |
7,496.47 |
8,101.89 |
| Exceptional Items |
- |
- |
- |
- |
| Profit before Taxes |
3,916.03 |
3,986.49 |
16,140.10 |
9,782.15 |
| Current Tax for the Year |
1,135.00 |
1,102.20 |
3,903.98 |
3,638.24 |
| Current Tax for Earlier Year |
154.45 |
8.38 |
- |
- |
| Deferred Tax |
(1,345.60) |
(1,609.76) |
(4,447.26) |
(4,415.99) |
| Profit after Tax & before Other Comprehensive Income |
3,972.18 |
4,485.67 |
16,683.38 |
10,460.90 |
| Total Comprehensive Income |
4,150.85 |
4,501.50 |
14,304.26 |
18,281.11 |
REGULATORY ENVIRONMENT AND ITS IMPACT ON BUSINESS AND INDUSTRY
The year 2016-17 was a tough year for the business and industry due to the unfavorable
regulatory framework coupled with challenge of demonetization. Government took a very
strong position against black money and cash transactions. The demonetization exercise,
its impact on cash transactions and the subsequent raids conducted by Income Tax
department on many jewellers created negative market sentiments.
Government also implemented the ‘Rs. 2 lakh PAN card rule and ‘no cash
beyond Rs. 2 lakh rule which impacted the business and made operations very difficult for
jewellery industry across the country which has high dependence on cash transactions.
Further Company was preparing itself to deal with the initial adaptability challenges
that implementation of GST was about to bring due to rolling out of GST from July 1,
2017. Under new GST regimen, governments (central and state) are expected to be
stringent with tax collections and this focus will positively drive noteworthy compliance
from all sectors. Also in long run the organized players are going to be benefitted as
consumers will increasingly turn to them due to trust, transparency, better consumer
experience and quality of service.
COMPANYS PERFORMANCE
Pursuant to the notification dated February 16, 2015 issued by the Ministry of
Corporate Affairs, the Company has adopted the Indian Accounting Standards ("Ind
AS") notified under the Companies (Indian Accounting Standards) Rules, 2015 with
effect from April 1, 2016. Financial statements for the year ended and as at March 31,
2016 have been restated to conform to Ind AS.
During the year under review, the Companys standalone sales and other income stood at
Rs. 10,61,126.93 Lakhs and Profitafter Tax & before Other Comprehensive Income on
standalone basis for the year was Rs. 3,972.18 Lakhs.
The consolidated sales and other income of the company stood at Rs. 16,83,143.97 Lakhs
and consolidated Profit after Tax & before Other Comprehensive Income for the year was
Rs. 16,683.38 Lakhs. The performance of jewellery segment continued to dominate the
diamond segment. The revenue from Jewellery segment stood at Rs. 7,77,730.63 Lakhs whereas
income from diamond segment stood at Rs. 2,82,164.13 Lakhs. The consolidated revenue from
Jewellery segment stood at Rs. 13,60,734.20 Lakhs whereas consolidated income from diamond
segment stood at Rs. 3,85,413.21 Lakhs.
DIVIDEND AND APPROPRIATION
The Directors are pleased to recommend the payment of dividend on equity shares at the
rate of 8% (Rs. 0.80 per equity share), subject to approval of the same by shareholders at
the Annual General Meeting (AGM). No amount is Proposed to be transfer to general reserve.
PUBLIC DEPOSITS
During FY 2013-14, the Company had accepted deposits of Rs. 227.29 lacs from the public
in line with the provisions of section 58A of the Companies Act, 1956.
Fixed deposits were for the period ranging from 1 year to 3 year and accordingly
carried interest rate variance from 11.50% to 12.50%. As on March 31, 2017, the company
repaid all the deposits except unclaimed matured deposit amounting to Rs. 1.25 lacs which
will be paid by the company as and when claimed by the Fixed Deposit holders. During the
year the company did not accept any further public deposit within the meaning of Section
73 to 76 of the Companies Act 2013 and rules framed there under.
SHARE CAPITAL
As on April 1, 2016 the paid up share capital of the Company was Rs. 1,02,43,77,240
consisting of 10,24,37,724 equity shares of Rs. 10 each. During the year under review
1,61,78,281 shares were allotted at a price of Rs. 72.39/- pursuant to conversion of
warrants issued to the persons other than promoter on preferential basis in different
tranches. Consequent to conversion, paid up capital of the Company as on date stood at Rs.
1,18,61,60,050 consisting of 11,86,16,005 equity shares of Rs. 10 each.
SUBSIDIARIES
A separate statement containing the salient features of financial statements of all
subsidiaries of the Company forms a part of consolidated financial statements in
compliance with Section 129 and other applicable provisions, if any, of the Companies Act,
2013. In accordance with Section 136 of the Companies Act, 2013, the financial statements
of the subsidiary and associate companies are available for inspection by the members at
the Registered Office of the Company during business hours on all days except Saturdays,
Sundays and public holidays. Any member desirous of obtaining a copy of the said financial
statements may write to the Company Secretary at the Registered Office of the Company. The
financial statements including the consolidated financial statements, financial statements
of subsidiaries and all other documents required to be attached to this report have been
uploaded on the website of the Company (www.gitanjaligroup.com). The Company has
formulated a policy for determining material subsidiaries. The policy may be accessed on
the website of the Company (www.gitanjaligroup.com).
During the year under review, Nakshatra World Limited (NWL), a wholly owned subsidiary
of the Company decided to raised funds through Initial Public Offering (IPO) of its equity
shares in accordance with SEBI (Issue of Capital and Disclosure Requirements) Regulations,
2009. NWL filed Draft Red Herring Prospectus with Securities and Exchange Board of India
(SEBI) and stock exchanges i.e BSE Limited (BSE) and National Stock Exchange of India
Limited (NSE) on March 10, 2017. As on date, NWL has received in principle approval from
BSE and NSE and also has received nod from SEBI to launch an IPO. NWL is in process of
preparation of Red Herring Prospectus and has an option to open the issue within 12 months
from the date of SEBIs approval. With a view to rationalize the existing group structure,
during the year under review various measures as enlisted herein below were undertaken:
a) Aston Luxury Group Limited, a Hong Kong based wholly owned subsidiary company sold
its investment in Tianxin Diamonds (Shanghai) Co. Ltd.
b) Gitanjali Infratech Limited, another wholly owned subsidiary of the company acquired
100% stake in ‘Dynamic Infrazone Private Limited.
c) Nakshatra World Limited, wholly owned subsidiary incorporated a wholly owned
subsidiary in Dubai, UAE named "Kiam Jewels DMCC" with an objective of enhancing
the groups presence in the UAE market where the Company already has operations through
its direct subsidiary Company, Gitanjali Ventures DMCC, Dubai.
d) During the year, Bezel Jewellery (India) Private
Limited became the wholly owned step down subsidiary of the Company as the existing
stakeholder ‘Damas Lewellery LLC sold off its equity stake to Nakshtra World
Limited.
e) Members may recall that for consolidation of distribution activities, subsidiaries
of the Company
Asmi Jewellery India Limited and Spectrum Jewellery Limited were in process to merge
with Nakshatra Brands Limited, another subsidiary. After complying with all the directions
of the court and obtaining approval from requisite authorities, merger of Asmi Jewellery
India Limited and Spectrum Jewellery Limited with Nakshatra Brands Limited became
effective from July 7, 2016.
f) Members may recall that for consolidation of manufacturing activities, wholly owned
subsidiary, Gitanjali Exports Corporation Limited, was in process to merge with the
Company. After complying with all the directions of the court and obtaining approval from
requisite authorities, merger of Gitanjali Exports Corporation Limited with Company became
effective from August 24, 2016.
g) The company acquired balance 1 (one) equity share of the face value of Rs.10/- in
Nakshatra World Limited (NWL) pursuant to which NWL became wholly owned subsidiary of the
Company.
h) Subsequent to the period of year under review, in order to avail various benefits of
consolidation of operations, the group has undertaken two more consolidation exercise for
its US based subsidiaries as enumerated herein below:
i) Diamlink Jewelry Inc. and Jewelry Marketing Company, LLC have merged with Diamlink
Inc. New York. After merger of these entities the remaining entity is renamed as "Jewelry
Marketing Company, Inc."
ii) ABBEY USA, LLC (erstwhile GGL Diamond LLC) and Tri-Star Worldwide, LLC merged with
Gitanjali USA Inc. After merger of these entities the remaining entity is renamed as
"Tri-Star Worldwide Inc."
A statement containing the financial performance of each of the subsidiaries companies
is included in the consolidated financial statements of the Company as set out elsewhere
in this Report.
CORPORATE GOVERNANCE
As per SEBI Listing Regulations, Corporate Governance Report and Auditors Certificate
regarding compliance of conditions of Corporate Governance forms part of the Annual
Report.
MANAGEMENT DISCUSSION AND ANALYSIS REPORT
In terms of provisions of Regulation 34 of Securities and Exchange Board of India
(Listing Obligations and Disclosure Requirements), Regulations, 2015, the Management
Discussion and Analysis Report is given separately as part of this annual report.
CONSOLIDATED FINANCIAL STATEMENTS
The Audited Consolidated Financial Statements are provided in this Annual Report which
have been prepared in accordance with relevant Accounting Standards issued by the
Institute of Chartered Accountants of India.
PARTICULARS OF LOANS, GUARANTEES AND INVESTMENTS
The particulars of loans, guarantees and investments have been disclosed in the
financial statements in Notes to the Financial Statements covered in the Annual Report.
MATERIAL CHANGES AND COMMITMENTS AFFECTING FINANCIAL POSITION BETWEEN END OF THE
FINANCIAL YEAR AND DATE OF REPORT
There have been no material changes and commitments affecting financial position
between end of the financial year and the date of the report and there are no significant
and material orders passed by the regulators or any courts or tribunals impacting the
going concern status and Companys operations in future.
ADEQUACY OF INTERNAL CONTROLS AND COMPLIANCE
The Audit Committee of the Company has reviewed the existing Internal Financial Control
systems and is of an opinion that Internal Financial Control framework as prescribed under
the ambit of Section 134(5) of Companies Act, 2013 is functioning properly. The financial
statements are prepared and presented in line with the essential components of internal
control - as stated in the "Guidance Note on Audit of Internal Financial Controls
Over Financial Reporting issued by the Institute of Chartered Accountants of India
(ICAI)".
The existing Internal Financial Control framework ensures systematic and professional
conduct of the Companys business. It ensures that Company adheres to its stated policies
and practices duly ensuring the safeguarding of its assets, prevention and detection of
frauds and errors, accuracy and completeness of the accounting records and the timely
preparation of reliable financial information.
Based on the assessment carried out by the Audit Committee, Board of Directors are of
the opinion that the Company has adequate Internal Financial Controls system, operating
effectively as at March 31, 2017 and there were no instances of fraud which necessitates
reporting of material misstatement to the Companys operations. There has been no
communication from regulatory agencies concerning non-compliance with or deficiencies in
financial reporting
RELATED PARTY TRANSACTIONS
There are no materially significant related party transactions made by the Company with
Promoters, Directors, Key Managerial Personnel or other designated persons which may have
a potential conflict with the interests of the Company at large. Prior omnibus approval of
the Audit Committee is obtained for the transactions which are of a foreseen and
repetitive nature and a statement of such transactions entered into pursuant to the
omnibus approval, giving requisite details is placed before the Audit Committee and the
Board of Directors for their noting and approval, if applicable, on a quarterly basis. The
Policy on Related Party as approved by the Board is uploaded on the Companys website.
During the year under review, the contracts or arrangements with related parties referred
to in section 188 of Companies Act, 2013 have been on arms length and in ordinary course
of business and they were not material in nature. Accordingly, the particulars of the
transactions as prescribed in form AOC -2 of the rules prescribed under chapter IX
relating to accounts of companies under the Companies Act, 2013 are not required to be
disclosed as they are not applicable. None of the transactions with any of related parties
were in conflict with the Companys interest. The Companys major related party
transactions are generally with its subsidiaries. The related party transactions are
entered into based on considerations of various business exigencies such as synergy in
operations, Companys long-term strategy for investments, optimization of market share,
profitability, liquidity, capital resources of subsidiaries, etc.
The Policy on dealing with related party transactions as approved by the Board may be
accessed on the Companys website at http://gitanjaligroup.com/policies-codes
AUDIT COMMITTEE:
The Audit Committee of the company consists of the following Directors:
Mr. S. Krishnan - Chairman
Ms. Nazura Ajaney - Member
Mr. Mehul Choksi - Member
The board accepted all the recommendations made by the audit committee during the year
under review. The details of terms of reference, number of audit committee meetings held
during the year under review, attendance, etc are separately given in the section of
corporate governance.
PARTICULARS OF ENERGY CONSERVATION, TECHNOLOGY ABSORPTION, EXPENDITURE ON RESEARCH AND
DEVELOPMENT, FOREIGN EXCHANGE INFLOW/OUTFLOW, ETC.
A. CONSERVATION OF ENERGY
The operations of your company is not energy intensive. However, the Company makes its
best efforts for conservation of energy in its factory and office premises.
B. TECHNOLOGY ABSORPTION, ADAPTATIONS & INNOVATION
The Company has not carried out any specific research and development activities. The
Company uses indigenous technology for its operations. Accordingly, the information
related to technology absorption, adaptation and innovation is reported to be NIL.
C. FOREIGN EXCHANGE EARNINGS AND OUTGO
The details of foreign exchange earnings and expenditure are as follows.
| Particulars |
(Rs. in lakhs) |
| Foreign Exchange Earnings |
7,32,149.19 |
| Expenditure in Foreign Exchange |
7,38,434.63 |
POLICY ON DIRECTORS APPOINTMENT AND REMUNERATION
The Board has, on the recommendation of the Nomination and Remuneration Committee,
framed a policy for selection and appointment of Directors, Senior Management and their
remuneration. The said policy states the criteria for determining qualifications, positive
attributes, independence of a Director and other matters provided under section 178(3) of
Companies Act, 2013. The said Policy of the Company is given as Annexure 1 of this
report. The same can also be viewed by visiting following link:
http://gitanjaligroup.com/policies-codes
CORPORATE SOCIAL RESPONSIBILITY (CSR)
A report on CSR is attached in Annexure 2 in the format prescribed in the
Companies (Corporate Social Responsibility Policy) Rules, 2014.
PARTICULARS OF EMPLOYEES
The details in terms of Section 197 of the Companies Act, 2013 read with Rule 5(1) of
the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, are
forming part of this report as Annexure 3A and the statement containing particulars
of employees as required under Section 197(12) of the Companies Act, 2013 read with Rule
5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014
is forming part of this report as Annexure 3B.
RISK MANAGEMENT POLICY
The Company has adopted a Risk Management Policy duly approved by the Board and also
has in place a mechanism to identify, assess, monitor and mitigate various risks that the
key business objectives might be exposed to. Major risks identified by the businesses and
functions are systematically addressed through mitigating actions on a continuing basis.
EXTRACT OF ANNUAL RETURN
As provided under Section 92(3) of the Act, the extract of annual return is given in Annexure
4 in the prescribed Form MGT-9, which forms part of this Report.
VIGIL MECHANISM
The Company has a whistle blower mechanism wherein the employees can approach the
senior management or Audit Committee and make disclosures about unethical behavior, actual
or suspected fraud or violation of the Companys Code of Conduct or of an event that
affect the business or reputation of the Company. A mechanism is in place whereby any
employee of the Company has access to the Chairman of the Audit Committee to report any
concern. No person has been denied access to the Chairman to report any concern. Further,
the said policy has been disseminated within the organization and has also been posted on
the Companys website.
DISCLOSURES AS PER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION
AND REDRESSAL) ACT, 2013
The Company is committed to provide a safe & conducive work environment to its
employees and has zero tolerance for sexual harassment at workplace. It has adopted a
policy on prevention, prohibition and redressal of sexual harassment at workplace in line
with the provisions of the Sexual Harassment of Women at Workplace (Prevention,
Prohibition and Redressal) Act, 2013 and the rules made thereunder for prevention and
redressal of complaints of sexual harassment at workplace. During the financial year
2016-17, the Company has not received any complaints on sexual harassment.
NUMBER OF MEETINGS OF THE BOARD
Five (5)meetings of the Board were held during the year. For details of the meetings of
the Board, reference may be made to the Corporate Governance Report, which forms part of
the Annual Report. The intervenimg gap between two consecutive board meetings did not
exceed 120 days.
DIRECTORS AND KEY MANAGERIAL PERSONNEL
Mr. S. Krishnan, Ms. Nazura Ajaney and Mr. Anil Haldipur are independent directors on
the Board and all have given declarations that they continue to meet the criteria of
independence as laid down under Section 149(6) of the Companies Act, 2013 and Regulation
25 of the Listing Regulations.
None of the Directors is related to each other within the meaning of the term
"relative" as per Section 2(77) of the Act.
In accordance with the provisions of the Act and in terms of the Memorandum and
Articles of Association of the Company, Mr. Dhanesh Sheth retires by rotation at the
Annual General Meeting and is eligible for re-appointment. Pursuant to Section 134 of the
Act read with Rule 8(5) (iii) of Companies (Accounts) Rules, 2014, no Director or Key
Managerial Personnel was appointed or has resigned during the year. However subsequent to
the year under review following changes took place at Board level:
* Mr. Mehul Choksi was re-appointed as managing director on the Board w.e.f. August 1,
2017.
* Mr. Dhanesh Sheth was designated as whole time director on the Board w.e.f. August
11, 2017.
* Mr. Anil Haldipur was appointed as an Additional Director (Independent) on the Board
of the Company on August 11, 2017.
Members attention is drawn to Item No. 5, 6 and 8 of the Notice for the appointment of
above mentioned directors on the Board of the Company.
Pursuant to the provisions of Section 203 of the Act, Mr. Mehul Choksi
–Managing Director, Mr. Chandrakant Karkare - Chief Financial Officer and Ms.
Pankhuri
Warange – Company Secretary continue to be the Key Managerial Personnel of the
Company.
DIRECTORS RESPONSIBILITY STATEMENT
Pursuant to the requirements of Section 134 (5) of the Companies Act 2013, (including
any statutory modification(s)or re-enactment(s) thereof for the time being in force), the
Directors hereby confirm that:
i. in the preparation of the annual accounts, the applicable accounting standards have
been followed and there are no material departures;
ii. they have selected such accounting policies and applied them consistently and made
judgments and estimates that are reasonable and prudent so as to give a true and fair view
of the state of affairs of the Company at the end of the financial year and of the profit
of the Company for that
iii. they 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;
iv. they have prepared the annual accounts on a going concern basis;
v. they have laid down internal financial controls to be followed by the Company and
that such internal financial controls are adequate and are operating effectively;
vi. they have devised proper systems to ensure compliance with the provisions of all
applicable laws and that such systems were adequate and operating effectively.
BOARD EVALUATION
The performance evaluation of the Board, its Committees and individual Directors was
conducted and the same was based on questionnaire and feedback from all the Directors on
the Board as a whole and its Committees. The Company obtained feedback on overall Board
effectiveness as well as on each of the Directors. The performance of Directors was
evaluated inter alia on the basis of key criteria for performance evaluation as enumerated
herein below-
Performance evaluation of Directors:
• Contribution made by them at the Board / Committee meetings
• Guidance provided / Support given to Management outside Board / Committee
Meetings
Performance evaluation of Board and Committees:
• The structure and composition of Board
• Degree of fulfillment of key responsibilities in line with prescribed
requirements
• Establishment and demarcation of responsibilities to various Committees of Board
• Effectiveness of Board Processes, Information and Functioning
• Quality of relationship between the Board and Management
• Effectiveness of communique with External Stakeholders
• The areas of improvement in the functioning of committees on the basis of their
terms of reference.
INDEPENDENT DIRECTORS
A separate meeting of the independent directors was convened, which reviewed the
performance of the Board (as a whole), the performance of non-independent directors and
the Chairman. Post the Annual Meeting of Independent Directors and performance evaluation
of Board, its Committees and individual Directors, the collective feedback of each of the
Directors was discussed and noted by the Nomination and Remuneration Committee.
FAMILIARIZATION PROGRAMS FOR BOARD MEMBERS
The Board members are provided with necessary documents/brochures, reports and internal
policies to enable them to familiarize with the Companys procedures and practices.
Periodic presentations are made at the Board Meetings, on business and performance
updates of the Company, global business environment, business strategy and risks involved.
The details of such familiarization programs conducted for Independent Directors are
posted on the website of the Company.
Further the policy of the Company on such familiarization programs can be accessed at
the following link: http://gitanjaligroup.com/policies-codes
AUDITORS
a) Statutory Auditors and their report
Pursuant to the provisions of Section 139 of the Companies Act 2013 read with
applicable Rules framed there under, M/s. Ford, Rhodes, Parks & Co. LLP, Chartered
Accountants, the present Auditors of the Company complete their term as Auditors. In view
of the above, M/s. Ambawat, Jain & Associates, LLP, Chartered Accountants having LLP
Registration No: AAA-7120 and ICAI Registration No: 109681W/ W 100012 is proposed to be
appointed for a term of five years commencing from conclusion of the 31st
Annual General Meeting of the Company till the conclusion of the 36th Annual General
Meeting to be held for the financial year 2021-22 (subject to ratification of their
appointment by the Members at every intervening Annual General Meeting held after this
Annual General Meeting) on such remuneration and out of pocket expenses as may be decided
by the Board of Directors. M/s. Ambawat, Jain & Associates, LLP, have confirmed their
eligibility under Section 141 of the Companies Act, 2013 and the Rules framed there under
for appointment as Auditors of the Company. As required under Regulation 33 of the Listing
Regulations, they have also confirmed that they hold a valid certificate issued by the
Peer Review Board of the Institute of Chartered Accountants of India.
The statutory auditors in their report on the financials of the company have drawn
attention towards the matter of emphasis. The response of directors on the same is as
follows:
Response to point (a)
Since 2013, the Company is passing through difficult financial conditions due to
extraneous factors beyond its control viz, unfavourable regulatory framework and adverse
forex movement. Due to liquidity challenges, there remained an overdue of principal and
interest amount and liquid reserve was partially created. However, management is confident
of clearing the outstanding dues soon along with due compliance of requirement of creation
of liquid reserve.
Response to point (b)(i) and (b) (ii)
Due to liquidity challenges as mentioned above both principal and interest amount of
ECBs raised through ICICI Bank and principal amount of ECBs raised through IDBI (BOB
portion) remained overdue.
However management is confident of clearing the outstanding dues soon.
Response to point (c)
Due to liquidity challenges, there have been occasions during FY 2016-17 where there
were few overdrawn position in some accounts. However, from time to time, the Company has
been clearing the said overdrawn positions and is making best efforts to regularise the
status.
Response to point (d)
The subsidiaries have been formed for providing support of companys business. The
terms and conditions of amount given to the subsidiaries are not prejudicial to the
interest of Company. The Company is making efforts to recover the advances given to these
subsidiaries and regularize the existing status.
With regard to emphasis of matter mentioned in audit report on consolidated financial
statements for the year ended March 31, 2017, the directors reply to points no (a), (b)
and, (d) of auditors report are covered in reply to emphasis of matter in auditor report
on standalone financial statement of the Company for the financial year ended March 31,
2017.
With regard to point (c), (e), and (f) of emphasis of matter in audit report on
consolidated financial statements the response of your directors are as follows
sequentially:
• Interest on ICDs availed from SICOM by one of the subsidiary was overdue as
at March 31, 2017 due to liquidity crunch
• The group has been regularly honoring all its debt obligations/ statutory
dues with some delays. Multiple extraneous factors have made significant negative impact
on the liquidity status of the group. The group however is committed to pay all its
outstanding undisputed statutory dues and liabilities and will pay the same gradually.
• As on March 31, 2017, Bezel Jewellery
(India) Private Limited, one of the step down subsidiary of the Company has not
redeemed its Non cumulative redeemable 4% preference shares of Rs. 100 each which was
partly due for redemption, as it was considering the option of extending due dates of
redemption.
b) Secretarial Auditor and their report
Pursuant to the provisions of Section 204 of the Companies Act, 2013 and the Companies
(Appointment and remuneration of Managerial Personnel) Rules, 2014, the Company has
appointed M/s. Manish Ghia & Associates, a firm of Company Secretaries in Practice to
undertake the Secretarial Audit of the Company. The Report of the Secretarial Audit is
annexed herewith as Annexure-5.
During the period under review, the Company has complied with provisions of the Act,
Rules, regulations, Guidelines, standards etc. subject to some observations made by
secretarial auditors. The response of directors on the observations made in secretarial
audit report is as follows:
Response to point (a)
Since 2013, the Company is passing through difficult financial conditions due to
multiple extraneous factors beyond its control viz, unfavourable market conditions and
unfavorable regulatory changes and adverse movement in forex etc. The Company has been
facing liquidity challenges and due to this the liquid reserve was partially created. The
Company has created liquid reserve to the tune of Rs. 63.47 lakhs as against required
reserve of Rs. 2.11 crores. Management is taking adequate steps to comply with the
requirement of creating the balance reserve soon.
Response to Point (b) and (c)
The filing of Annual Performance Report and Annual Return on Foreign Liabilities and
Assets involves compilation and filing of details of various subsidiaries scattered across
the globe.
Due to technical difficulties in compiling the relevant information, the requirement of
filing was unintentionally delayed.
Response to point (d)
The delays in filing of form ECB-2 was due to administrative issues. The requisite
steps will be taken to ensure that Form ECB-2 is filed on time.
GENERAL
Your Directors state that no disclosure or reporting is required in respect of the
following items as there were no transactions on these items during the year under review:
1. Issue of equity shares with differential rights as to dividend, voting or otherwise.
2. Issue of sweat equity shares to employees of the Company under any scheme.
3. Issue of shares under Employee Stock Option Scheme.
4. The Managing Director of the Company is not in receipt of any commission from the
Company nor he received any remuneration or commission from any of the subsidiary of the
Company.
Acknowledgements
Your Directors wish to place on record their sincere appreciation of the support which
the Company has received from its promoters, shareholders, lenders, business associates,
vendors, customers, media and the employees of the Company.
We thank the Governments of various countries where we have operations. We also thank
the Government of India, Ministry of Commerce & Industry, Ministry of Corporate
Affairs, Ministry of Finance, Department of Economic Affairs, Customs & Excise
Departments, Income Tax Department, Reserve Bank of India, BSE, NSE, NSDL, CDSL and
various bankers, various State Governments and other Government Agencies for their support
and we look forward to their continued support in the future.
|
On behalf of the Board of Directors |
|
Sd/- |
| Place : Mumbai |
(Mehul Choksi) |
| Date : August 11, 2017 |
Chairman and Managing Director |
+91-9892691696
