Goa Carbon Ltd Directors Report.

The Members,

Your Directors have pleasure in presenting the 51st Annual Report on the business and operations of the Company and the audited financial statements for the year ended 31st March 2019.

Financial Results

Rs. in lakhs
2018-19 2017-18
Profit for the year before tax (1,083.09) 8,952.09
Less: Tax Expense -
Current Tax 13.22 3,586.81
Deferred Tax (344.87) (19.57)
(331.65) 3,567.24
Profit for the year after tax (751.44) 5,384.85
Other Comprehensive income for the year 73.95 7.71
Total Comprehensive income for the year (677.49) 5,392.56

Year in Retrospect

During the year under review, the Companys sales and other income was Rs. 46,403.61 lakhs as compared to Rs. 59,598.78 lakhs during the previous year. The production of Calcined Petroleum Coke (CPC) was 1,57,135 MT as compared to 2,04,114 MT during the previous year. The sales of CPC were 1,41,701 MT for the period under review as compared to 2,09,343 MT for the previous year.

The Honble Supreme Court of India vide order dated 26.07.2018 had banned the import of petroleum coke if used as a fuel. Since the company uses petroleum coke only as “Feedstock” for producing calcined petroleum coke, the Company had filed an application with the Honble Supreme Court of India representing that the Company uses raw petroleum Coke (RPC) as “Feedstock” and hence Calcination Industries should be allowed to import RPC. Based on the recommendations of Ministry of Environment/ Forest and Climate Change (MOE&CC) and Environment Pollution Control Authority (EPCA), the Honble Supreme Court has passed the order dated 9.10.2018 by permitting the import of RPC up to 1.40 million metric tonnes per annum for the Indian calcination industry as a whole for feedstock.

On the basis of Court order dated 09.10.2018, the Director General of Foreign Trade (DGFT) vide Public Notice No 50/2015- 20 notified additional procedures for applying for quota and for granting the import license and further amended the import policy in this respect. Based on Companys application, DGFT has allocated the quota for import of RPC for FY 2019-20.

Dividend and Transfer to Reserve

In view of the losses incurred by the Company:

i) your Directors have not recommended any dividend for the financial year ended 31st March 2019;

ii) no amount has been transferred to reserve for the financial year ended 31st March 2019.

Credit Rating

SMERA Ratings Limited - the credit rating agency, has assigned the credit rating of “SMERA BBB” to the long-term Bank facilities availed by the Company and credit rating of “SMERA A3+” to the short-term Bank facilities availed/proposed by the Company. The outlook mentioned is negative.

Subsidiary Companies

The Company did not have any subsidiary as on 31st March 2019.

Accreditation

The Company continues to enjoy ISO 9001 & ISO 14001 accreditation made by BUREAU VERITAS.

Public Deposits

The Company has not accepted any deposits falling under the ambit of Section 73 of the Companies Act, 2013 from public and as such, no amount on account of principal or interest on deposits from public deposits was outstanding as on 31st March 2019.

Directors

Cessation

Pursuant to the amendments to Regulation 17(1A) of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 and the Board Policy on the Appointment/Retirement of Directors of the Company, Mr. Dara Mehta, Independent Director of the Company ceased to be a Director with effect from 1st April 2019 on account of age limit of 75 years set for the Independent Directors. The Directors place on record their deep appreciation for the invaluable contributions made by Mr. Dara Mehta during his long tenure as Director for over 43 years.

Appointment/Re-appointment

Mr. Shrinivas Dempo retires by rotation at the forthcoming Annual General Meeting and being eligible has offered himself for reappointment. Approval of the members is being sought at the ensuing Annual General Meeting for his re-appointment and the requisite details in this connection are contained in the Notice convening the meeting.

Based upon the recommendation of the Nomination and Remuneration Committee, Mr. Nagesh Pinge was appointed as an Additional Director (in the capacity of an Independent Director)

by the Board on 6th May 2019, who holds office up to the date of ensuing Annual General Meeting. In terms of Section 161 of the Act read with Article 137 of the Articles of Association of the Company, the Company has received a notice in writing from a Member of the Company proposing his candidature for the office of Director of the Company.

The first term of office of Mr. Keki Elavia and Mr. Raman Madhok, as Independent Directors, expires at the ensuing Annual General Meeting. The Board has recommended re-appointment of Mr. Keki Elavia for a second term up to 08.04.2021 (being the age limit of 75 years) and Mr. Raman Madhok for a second term up to 01.02.2020 (being the age limit of 75 years) as Independent Directors of the Company.

On recommendation of the Nomination and Remuneration Committee, the Board of Directors has re-appointed Mr. Jagmohan Chhabra as a Whole-time Director, designated as “Executive Director” of the Company, for a further period of 3 (three) years from 1st April 2019 to 31st March 2022. The appointment, terms and conditions of the said reappointment including remuneration are subject to the approval of the Members. (Kindly refer resolution and the explanatory statement set out in the Notice of the 51st Annual General Meeting).

The disclosures required pursuant to Regulation 36 of the SEBI Listing Regulations, Clause 1.2.5 of the Secretarial Standard are given in the Notice of AGM, forming part of the Annual Report and Schedule V of the SEBI Listing Regulations are given in the Corporate Governance Report, forming part of the Annual Report. Attention of the Members is also invited to the relevant items in the Notice of the AGM.

Independent Directors Declarations

All Independent Directors of the Company have given declarations under Section 149(7) of the Companies Act, 2013 that they meet the criteria of independence as laid down under Section 149(6) of the Act and Regulation 16 of the SEBI Listing Regulations.

Key Managerial Personnel

In terms of the Section 203 of the Companies Act, 2013, following are the Key Managerial Personnel (KMP) of the Company as on the date of this report;

Sr. No. Name of the KMP Designation
1 Mr. Jagmohan Chhabra (DIN: 01007714) Executive Director
2 Mr. K. Balaraman (ACA 029283) Chief Financial Officer
3 Mr. Pravin Satardekar (ACS 24380) Company Secretary

Meetings of the Board of Directors

A minimum of four Board meetings are held annually. Additional Board meetings are convened by giving appropriate notice to address the Companys specific needs. In case of business exigencies or urgency of matters, resolutions are passed by circulation.

During the year under review, four Board meetings were held, the details of which are given in the Corporate Governance Report which forms part of this Annual Report.

The intervening gap between two consecutive meetings was within the period prescribed under the Companies Act, 2013 and the SEBI Listing Regulations.

Audit Committee

Composition of the Audit Committee

Sr. No. Name of the Director Chairman/Member
1 Mr. Nagesh Pinge* Chairman
2 Mr. Raman Madhok# Member
3 Mr. Dara Mehta$ Chairman
4 Mr. Keki Elavia Member
5 Ms. Kiran Dhingra@ Member

* Mr. Nagesh Pinge was appointed as Chairman of the Committee with effect from 6th May 2019.

# Mr. Raman Madhok was designated as Chairman of the Committee from 1st April 2019 up to 5th May 2019.

$ Mr. Dara Mehta ceased to be the Chairman and Member of the Committee with effect from 1st April 2019.

@ Ms. Kiran Dhingra was appointed as Member of the Audit Committee with effect from 12th April 2018.

The terms of reference and other details of the Audit Committee are provided in Corporate Governance Report which forms part of this Annual Report. During the Financial Year 2018-19, all the recommendations of the Audit Committee were duly approved and accepted by the Board.

Policy on Directors appointment, remuneration and other details

The Committee has formulated a Nomination and Remuneration Policy and the same has been uploaded on the website of the Company at www.goacarbon.com

The salient features of the Nomination and Remuneration Policy is included in this Report as Annexure - I.

Board Evaluation

The annual evaluation process of the Board of Directors (“Board”), Committees and individual Directors was carried out in the manner prescribed in the provisions of the Companies Act, 2013, Guidance Note on Board Evaluation issued by Securities and Exchange Board of India on 5th January 2017 and as per the Corporate Governance requirements prescribed by SEBI Listing Regulations.

The performance of the Board, Committees and individual Directors was evaluated by the Board seeking inputs from all the Directors. The performance of the Committees was evaluated by the Board seeking inputs from the Committee Members. The Nomination and Remuneration Committee reviewed the performance of the individual Directors, a separate meeting of Independent Directors was also held to review the performance of Non-Independent Directors; performance of the Board as a whole and performance of the Chairperson of the Company, taking into account the views of the Executive Director and Non-Executive Directors. This was followed by a Board meeting that discussed the performance of the Board, its Committees and individual Directors.

The criteria for performance evaluation of the Board included aspects like Board composition and structure; effectiveness of Board processes, information and functioning, etc. The criteria for performance evaluation of Committees of the Board included aspects like composition and structure of the Committees, functioning of Committee meetings, contribution to decision of the Board, etc. The criteria for performance evaluation of the individual Directors included aspects on contribution to the Board and Committee meetings like preparedness on the issues to be discussed, meaningful and constructive contribution and inputs in meetings, integrity etc. In addition, the Chairman was also evaluated on the key aspects of his role.

Familiarization Programme for Independent Directors

The details of the Familiarisation Programme for Independent Directors with the Company in respect of their roles, rights, responsibilities in the Company, nature of the industry in which Company operates, business model of the Company and related matters are put up on the website of the Company at www.goacarbon.com

Internal Control System

The Board has laid down Internal Financial Controls (“IFC”) within the meaning of the explanation to Section 134 (5) (e) of the Companies Act, 2013. The Board believes the Company has sound IFC commensurate with the nature and size of its business. Business is however dynamic. The Board is seized of the fact that IFC are not static and are in fact a fluid set of tools which evolve over time as the business, technology and fraud environment changes in response to competition, industry practices, legislation, regulation and current economic conditions. There will, therefore, be gaps in the IFC as business evolves. The Company has a process in place to continuously identify such gaps and implement newer and or improved controls wherever the effect of such gaps would have a material effect on the Companys operations.

Statutory Auditors

Pursuant to provisions of Section 139 of the Companies Act, 2013 read with the Companies (Audit and Auditors) Rules, 2014, In the 49th Annual General Meeting held on 30th June 2017, M/s. B S R & Co. LLP, Chartered Accountants (Registration No. 101248W/W- 100022) were appointed as Statutory Auditors of the Company for a term of five years at such remuneration and out of pocket expenses, as may be decided by the Board of Directors of the Company. The Ministry of Corporate Affairs has vide notification dated 7th May 2018 obliterated the requirement of seeking Members ratification at every AGM on appointment of Statutory Auditor during their tenure of 5 years.

Statutory Auditors Observations

The notes on financial statements referred to in the Auditors Report are self-explanatory and therefore, do not call for any further explanations or comments.

There are no qualifications, reservations or adverse remarks or disclaimer made in the Auditors Report which requires any clarification or explanation.

Cost Audit

The maintenance of cost records is not applicable to the Company as per the amended Companies (Cost Records and Audit) Rules, 2014, prescribed by the Central Government under Section 148(1) of the Companies Act, 2013.

Secretarial Audit

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and the rules thereunder, the Board of Directors of the Company had appointed CS Sadashiv V. Shet, Practicing Company Secretary to conduct the Secretarial Audit for FY 2018-19. The Secretarial Audit Report for the financial year ended 31st March 2019 forms a part of this Annual Report. The same is self explanatory and requires no comments.

Vigil Mechanism/Whistle Blower Policy

The Company has established a Vigil Mechanism/Whistleblower Policy for the employees to report their genuine concerns or grievances and the same has been posted on the Companys website www.goacarbon.com.

The Audit Committee of the Company oversees the Vigil Mechanism.

Risk Management

Goa Carbon follows a well-established and detailed risk assessment and minimization procedures, which are periodically reviewed by the Board. The Company has in place a business risk management framework for identifying risks and opportunities that may have a bearing on the organizations objectives, assessing them in terms of likelihood and magnitude of impact and determining a response strategy.

The Senior Management assists the Board in its oversight of the Companys management of key risks, including strategic and operational risks, as well as the guidelines, policies and processes for monitoring and mitigating such risks under the aegis of the overall business risk management framework.

Particulars of loans, guarantees or investments

The details of loans, guarantees and investments covered under the provisions of Section 186 of the Companies Act, 2013 are given in the notes to financial statements.

Related Party Transactions

All transactions with related parties entered into during the financial year 2018-19 were at arms length basis and in the ordinary course of business and in accordance with the provisions of the Companies Act, 2013 and the SEBI Listing Regulations. During the Financial Year 2018-19, there have been no related party transactions of the Company with its Directors and Key Managerial Personnel or their relatives, its holding, subsidiary or associate companies as prescribed under Section 188 of the Companies Act, 2013 and SEBI Listing Regulations. Also, there are no material transactions with any related party that are required to be disclosed under Form AOC-2.

All transactions with related parties are placed before the Audit Committee for approval. An omnibus approval of the Audit Committee is obtained for the related party transactions which are repetitive in nature. The Audit Committee reviews all transactions entered into pursuant to the omnibus approval so granted on a quarterly basis.

As required under regulation 23(1) of the Listing Regulations, the Company has formulated a policy on dealing with Related Party Transactions. The Policy has been uploaded on the website of the Company and can be accessed at: http://www.goacarbon. com/downloads/Related%20Party%20Transaction%20Policy_ GOA%20CARBON%20LIMITED.pdf

Significant and material orders passed by the Regulators or Courts

There were no significant material orders passed by the Regulators/Courts/Tribunals which would impact the going concern status of the Company and its future operations.

Material changes and commitment, if any, affecting financial position of the Company from financial year end and till the date of this report

There have been no 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 this Report.

Particulars of employees and related disclosures

The information required pursuant to Section 197(12) read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are provided in the Annexure - II to this Report.

The statement containing particulars of top 10 employees and the employees drawing remuneration in excess of limits prescribed under Section 197 (12) of the Companies Act, 2013 read with Rule 5 (2) and (3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is provided in a separate Annexure forming part of the Report. In terms of proviso to Section 136(1) of the Companies Act, 2013, the Report and Accounts are being sent to the Members excluding the aforesaid Annexure. The said statement is also open for inspection at the Registered Office of the Company. Any member interested in obtaining a copy of the same may write to the Company Secretary.

Disclosures under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013

In accordance with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the rules made there under, the Company has formulated an internal Policy on Sexual Harassment at Workplace (Prevention, Prohibition and Redressal).

The policy aims at educating employees on conduct that constitutes sexual harassment, ways and means to prevent occurrence of any such incident, and the mechanism for dealing with such incident in the unlikely event of its occurrence.

The Company has complied with the provisions relating to the constitution of an Internal Complaint Committee (ICC) under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 by setting up the said Committee comprising of two female and two male employees. One of the female employees is the Chairperson of the Committee. There is one external female member on the Committee who is from a non-governmental organization/association, committed to the cause of women/familiar with the issues relating to sexual harassment.

The ICC is responsible for redressal of complaints related to sexual harassment of women at the workplace in accordance with procedures, regulations and guidelines provided in the Policy.

During the year under review, there were no complaints referred to the ICC.

Energy Conservation, Technology Absorption, Foreign Exchange Earnings and Outgo

The particulars relating to energy conservation, technology absorption, foreign exchange earnings and outgo, required to be disclosed by Section 134 (3)(m) of the Companies Act, 2013 read with Rule 8(3) of the Companies (Accounts) Rules, 2014 (as amended) are provided in the Annexure - III to this Report.

Corporate Social Responsibility (CSR)

Pursuant to Section 135 of the Companies Act, 2013 read with rules made there under, your Directors have constituted the Corporate Social Responsibility (CSR) Committee.

Composition of the CSR Committee

Sr. No. Name of the Director Chairman / Member
1 Mr. Shrinivas Dempo Chairman
2 Mr. Raman Madhok Member
3 Ms. Kiran Dhingra Member
4 Mr. Jagmohan Chhabra Member

The brief outline of the CSR Policy of the Company and the initiatives undertaken by the Company on CSR activities during the year are set out in Annexure - IV of this Report in the format prescribed in the Companies (CSR Policy) Rules, 2014. The Policy is available on the Companys website at www.goacarbon.com.

Annual Return

The Annual Return of the Company for FY 2018-19 has been placed on the website of the Company at www.goacarbon.com.

Corporate Governance

It has been the endeavour of your Company to follow and implement best practices in corporate governance, in letter and spirit. The following forms part of this Annual Report:

(i) Declaration regarding compliance of Code of Conduct by Board Members and Senior Management Personnel;

(ii) Management Discussion and Analysis;

(iii) Corporate Governance Report and;

(iv) Practicing Company Secretarys Certificate regarding compliance of conditions of corporate governance;

Directors Responsibility Statement

Based on the framework of internal financial controls and compliance systems established and maintained by the Company, work performed by the internal auditors, statutory auditors, secretarial auditors and any other external agencies, if any, including audit of internal financial controls over financial reporting by the statutory auditors and the reviews performed by Management and the Audit Committee, the Board is of the opinion that the Companys internal financial controls were adequate and effective during the Financial Year 2018-19.

Accordingly, pursuant to Section 134(5) of the Companies Act, 2013, the Board of Directors, to the best of their knowledge and ability, confirm:

(a) that in the preparation of the annual accounts, the applicable accounting standards have been followed along with the proper explanation relating to material departures;

(b) that such accounting policies as mentioned in Notes to the annual accounts have been selected and applied consistently and judgement and estimates have been made 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) that proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

(d) that the annual accounts have been prepared on a going concern basis;

(e) that proper internal financial controls are in place and that the internal financial controls are adequate and are operating effectively;

(f) that proper systems to ensure compliance with the provisions of all applicable laws are in place and that such systems are adequate and operating effectively.

Appreciation and Acknowledgement

Your Directors would like to express their appreciation for the assistance and co-operation received from the Government authorities, banks, customers, business associates and members during the year under review. Your Directors also wish to place on record their deep sense of appreciation for the committed services by the executives, staff and workers of the Company.

For and on behalf of the Board of Directors

Shrinivas Dempo

Chairman

DIN: 00043413

Panaji-Goa

7th May 2019

Annexure - I to the Directors Report

Salient features of the Nomination and Remuneration Policy

Policy for appointment and removal of Director, KMP and Senior Management:

This policy has been prepared pursuant to the provisions of Section 178 and such other applicable sections of the Companies Act, 2013 (“Act”) and the SEBI Listing Obligations and Disclosure Requirements, Regulations, 2015 (“LODR”). In case of any inconsistency between the provisions of law and this remuneration policy, the provisions of the law shall prevail, and the company shall abide by the applicable law.

Appointment criteria and qualifications:

a) The philosophy for appointment and retirement of directors of Goa Carbon Limited (“the company”) is based on the commitment of fostering a culture of leadership with trust. The Directors appointment and retirement policy is aligned to this philosophy.

b) The Committee shall identify and ascertain the integrity, qualification, expertise and experience of the person for appointment as Director, KMP or at Senior Management level and recommend to the Board his/her appointment.

c) A person should possess adequate qualification, expertise and experience for the position he/she is considered for appointment. The Committee has discretion to decide whether qualification, expertise and experience possessed by a person is sufficient/satisfactory for the concerned position.

Key principles governing Directors appointment/retirement policy are as follows:

Director Term, Tenure and Directorships

• Boards are encouraged to seek a balance between change and continuity.

• In case of Non-Independent Non-Executive Director (NEDs), each term should be decided as per the provisions pertaining to the retirement by rotation. They can be reappointed for subsequent terms until the applicable retirement age.

• In case of Independent Directors (IDs), each term should not exceed a period of 5 years or until the applicable retirement age, whichever is earlier, extendable for up to a total of two consecutive terms. The Independent Director who has served the two consecutive term as mentioned above, may be considered for a fresh appointment after the expiry of the cooling period as specified under the Act (presently three years of ceasing to become an Independent Director. Provided that the Independent Director shall not, during the said period of three years, be appointed in or be associated with the company in any other capacity, either directly or indirectly).

• Each term of a Managing Director (MD)/Executive Director (ED) should not exceed a period of 5 years or until the applicable retirement age, whichever is earlier.

• MD and EDs shall hold office up to the age of 60 years, or earlier, as determined by the Board of the company.

• The retirement age for Non-Independent NEDs would be 80 years unless a lower retirement age is specified under the laws applicable to the company.

• The retirement age for IDs would be 75 years, unless a lower retirement age is specified under the laws applicable to the company.

Board Appointment, Induction and Development

Procedure for Nomination and Appointment of Directors

• It is the responsibility of the NRC to develop competency requirements for the Board based on the industry and strategy of the company. Board composition analysis should ideally reflect in-depth understanding of the company, including its strategies, environment, operations, financial condition and compliance requirements.

• It is recommended that the NRC conduct a gap analysis and refresh the Board on a periodic basis, including every time a directors appointment or reappointment is required.

• Board members may provide director nominations to the Chairman of the NRC. The Chairman of the NRC should ideally maintain a list of nominees. The nominees should have a good personal and professional reputation.

• To meet the objectives of driving diversity and an optimum skill mix, the NRC may seek the support of outside Industry Expert, if needed.

• The NRC is responsible for reviewing and vetting the CVs of the potential candidates vis-a-vis the required competencies. The committee may meet the potential candidates prior to making recommendations of their nomination to the Board.

• It is the responsibility of the NRC to make recommendations to the Board in relation to the appointment of new directors. The NRC should conduct appropriate reference checks and due diligence on all director prospects before recommending them to the Board.

• Post approval, the desired candidate is invited to join the Board.

• At the time of appointment, the specific requirements for the position should be communicated to the person, including the expert knowledge expected.

Directors Induction and Development

• The NRC will ensure an effective familiarization program for new directors.

• The familiarization program may include:

Roles, rights and responsibilities of directors.

Mechanisms to build working relationship among the Board members.

Core values, ethics and corporate governance practices of the Dempo Group.

Industry/sectorial overview, Companys vision, strategic direction, business model.

Financial matters, management team and business operations.

Meetings with stakeholders, visit to business locations and meetings with senior and middle management.

Directors are expected to make and implement their own plan for refreshing their knowledge.

The NRC will support the directors, as may be required, to continually update their skills and knowledge and their familiarity with the company and its business.

Training can be conducted by the companys experts from relevant fields, or by an external agency at the Head Office or at appropriate institutions.

The company will fund/arrange for training on all matters which are common to the Board.

Evaluation:

The Committee shall carry out evaluation of performance of every Director (on yearly basis).

The Committee shall identify evaluation criteria which will evaluate Directors based on the attendance/preparedness/participation/ performance at board meetings, professional conduct and independence etc. The appointment/re-appointment/continuation of Directors on the Board shall be subject to the outcome of the yearly evaluation process.

The Committee shall oversee the framework for performance evaluation of the Board and Independent Directors.

Removal:

Due to reasons for any disqualification mentioned in the Companies Act, 2013, rules made there under or under any other applicable Act, rules and regulations, the Committee may recommend, to the Board with reasons recorded in writing, removal of a Director, KMP or Senior Management Personnel subject to the provisions and compliance of the said Act, rules and regulations.

Policy on Board diversity:

The Board of Directors shall have the optimum combination of Directors from the different areas/fields like Process/Projects, Production, Management, Finance, Legal, Sales and Marketing, Research and Development, Human Resources etc. or as may be considered appropriate.

The Board shall have at least one Board member who has accounting or related financial management expertise and at least two members who are financially literate.

Remuneration to Managing Director/Whole-time Director/ Manager, KMP and Senior Management Personnel:

Key principles governing this remuneration policy are as follows: Remuneration for independent directors and non-independent non-executive directors

• Independent directors (“ID”) and non-independent nonexecutive directors (“NED”) may be paid sitting fees (for attending the meetings of the Board and of committees of which they may be members) and commission within regulatory limits.

• Within the parameters prescribed by law, the payment of sitting fees and commission will be recommended by the NRC and approved by the Board.

• Overall remuneration (sitting fees and commission) should be reasonable and sufficient to attract, retain and motivate directors aligned to the requirements of the Company (taking into consideration the challenges faced by the Company and its future growth imperatives).

• Overall remuneration should be reflective of size of the Company, complexity of the sector/industry/Companys operations and the Companys capacity to pay the remuneration.

• Overall remuneration practices should be consistent with recognized best practices.

• Quantum of sitting fees may be subject to review on a periodic basis, as required.

• The aggregate commission payable to all the NEDs and IDs will be recommended by the NRC to the Board based on Company performance, profits, return to investors, shareholder value creation and any other significant qualitative parameters as may be decided by the Board.

• The NRC will recommend to the Board the quantum of commission for each director based upon the outcome of the evaluation process which is driven by various factors including attendance and time spent in the Board and committee meetings, individual contributions at the meetings and contributions made by directors other than in meetings.

• In addition to the sitting fees and commission, the Company may pay to any director such fair and reasonable expenditure, as may have been incurred by the director while performing his/her role as a director of the Company. This could include reasonable expenditure incurred by the director for attending Board/Board committee meetings, general meetings, court convened meetings, meetings with shareholders/creditors/ management, site visits, induction and training (organized by the Company for directors) and in obtaining professional advice from independent advisors in the furtherance of his/ her duties as a director.

• An Independent Director shall not be entitled to any stock option of the Company.

Remuneration for Managing Director (“MD”)/Executive Directors (“ED”)/KMP/ Sr. Management

The extent of overall remuneration should be sufficient to attract and retain talented and qualified individuals suitable for every role. Hence remuneration should be :

• Market competitive (market for every role is defined as companies from which the Company attracts talent or companies to which the Company loses talent),

• Driven by the role played by the individual,

• Reflective of size of the Company, complexity of the sector/ industry/Companys operations and the Companys capacity to pay,

• Consistent with recognized best practices and

• Aligned to any regulatory requirements.

• In terms of remuneration mix or composition,

- The remuneration mix for the MD/EDs is as per the contract approved by the shareholders. In case of any change, the same would require the approval of the shareholders.

- Basic/fixed salary is provided to all employees to ensure that there is a steady income in line with their skills and experience.

- In addition to the basic/fixed salary, the Company provides employees with certain perquisites, allowances and benefits to enable a certain level of lifestyle and to offer scope for savings and tax optimization, where possible. The Company also provides eligible employees with a social security net (subject to limits) by covering medical expenses and hospitalization through re-imbursements or insurance cover and accidental death and dismemberment through personal accident insurance.

- The Company provides retirement benefits as applicable.

- In addition to the basic/fixed salary, benefits, perquisites and allowances as provided above, the Company provides MD/ EDs such remuneration by way of an annual increment and/ or performance pay subject to the achievement of certain performance criteria and such other parameters as may be considered appropriate from time to time by the Board subject to the overall ceilings stipulated in Section 197 of the Act or such other applicable provisions. An indicative list of factors that may be considered for determination of the extent of this component are:

• Company performance on certain qualitative and quantitative parameters as may be decided by the Board from time to time.

• Industry benchmarks of remuneration.

• Performance of the individual.

Minimum Remuneration:

If, in any financial year, the Company has no profits or its profits are inadequate, the Company shall pay remuneration to its Managing Director/Whole-time Director/Manager in accordance with the provisions of Schedule V of the Act or such other applicable provisions and if it is not able to comply with such provisions, with the approval of the shareholders or such other approvals as may be necessary.

Provisions for excess remuneration:

If any Managing Director/Whole-time Director/Manager draws or receives, directly or indirectly by way of remuneration any such sums in excess of the limits prescribed under the Act or without the prior sanction of the requisite authorities, where required, he/she shall refund such sums to the Company and until such sum is refunded, hold it in trust for the Company. The Company shall not waive recovery of such sum refundable to it unless permitted by the requisite authorities.

The KMP and Senior Management Personnel of the Company shall be paid monthly remuneration as per the Companys HR policies approved by the Committee. The NRC shall review and recommend any proposed performance based increments or incentives in any financial year payable to the KMPs and the Senior Management Personnel based on the performance of the Company and the respective individuals.

Loans and advances to employees of the Company:

The employees of the Company, on an application in writing to the CEO of the Company, be granted loan or advance at an interest rate to be decided by the KMPs of the Company with consideration to the income/financial status or position of the requesting employee/any other criteria or as per the Companys HR policies.

Remuneration payable to Director for services rendered in other capacity

The remuneration payable to the Directors shall be inclusive of any remuneration payable for services rendered by such director in any other capacity, unless:

a) The services rendered are of a professional nature; and

b) The NRC is of the opinion that the director possesses requisite qualification for the practice of the profession.

Policy implementation

The NRC is responsible for recommending Appointment/ Retirement and Remuneration policy to the Board. The Board is responsible for approving and overseeing implementation of this policy.

Annexure - II to the Directors Report

Details pertaining to remuneration as required under Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014

i) The percentage increase in remuneration of each Director and KMP during the financial year 2018-19 and ratio of the remuneration of each Director to the median remuneration of the employees of the Company for the financial year 2018-19 are as under:

Sr. No. Name of Director/KMP Designation/Category Remuneration (? in Lacs) % increase in remuneration Ratio of remuneration of each Director to median remuneration of employees
1. Mr. Shrinivas Dempo Chairman - Non-Executive Director 1.75 (90.58) 0.34:1
2. Mr. Dara Mehta Independent - Non-Executive Director 1.90 (90.12) 0.37:1
3. Mr. Keki Elavia Independent - Non-Executive Director 2.60 (85.58) 0.51:1
4. Mr. Raman Madhok Independent - Non-Executive Director 2.00 (87.87) 0.39:1
5. Ms. Kiran Dhingra Independent - Non-Executive Director 2.30 (82.64) 0.45:1
6. Mr. Rajesh Dempo Non-Executive Director 1.80 (86.45) 0.35:1
7. Mr. Jagmohan Chhabra Executive Director 103.81 (25.06) 20.46:1
8. Mr. K. Balaraman Chief Financial Officer 49.61 0 Not applicable
9. Mr. Pravin Satardekar Company Secretary 25.39 # Not applicable

# Since the remuneration paid for FY2017-18 was for part of the year, the ratio of the remuneration paid for FY2018-19 to median remuneration/percentage increase in remuneration is not comparable and hence, not stated.

ii) The median remuneration of employees of the Company during the Financial Year was 5.07 lacs.

iii) The percentage increase in the median remuneration of employees for the Financial Year was 13.96%.

iv) The Company had 200 permanent employees on its rolls as on 31st March 2019.

v) Average percentage increase made in the salaries of employees other than the managerial personnel in the last financial year i.e. 2018-19 was 7.10% whereas the increase in the managerial remuneration for the same financial year was (52.41)%.

vi) It is hereby affirmed that the remuneration paid during the year is as per the Remuneration Policy of the Company.

For and on behalf of the Board of Directors
Shrinivas Dempo
Chairman
DIN: 00043413
Panaji-Goa
7th May 2019

Particulars with respect to conservation of energy, etc. as per Companies (Accounts) Rules, 2014

(A) Conservation of Energy Goa Plant Bilaspur Plant Paradeep Plant
(i) the steps taken or impact on conservation of energy Total electrical units consumed during the year was 18,76,859 kwh units as against 9,65,544 kwh units of the previous year. Consumption of electrical energy per metric ton of Calcined Petroleum Coke (CPC) produced during the year was 34.44 kwh/MT of CPC as against 16.98 kwh/MT of previous year. This is due to additional electrical load of pollution control equipment installed and in operation during the year. A strict control on routinely maintaining power factor enabled the Company to get maximum rebate of Rs. 4,28,828/-. Electrical Energy consumption during the year has increased to 15.37 kwh/MT as compared to 14.81 kwh/MT of previous year. This has increased due to lower production running days. A vigilant control on periodically maintained power factor enabled the Company to minimize power consumption. The specific Electrical Energy consumption for the financial year 2018-19 was 32.00 kwh/MT. In comparison with the previous financial year 2017-18, the specific energy consumption is less by 0.19 kwh/MT of CPC produced. The false air entry at the Forced draft Coolers were arrested and hence we had run the ID Fan with less RMP and hence the power consumption was low.
Furnace Oil consumption during the year was 27,390 litres (including heating & cooling of Kiln) as against 32,300 litres of previous year. Furnace Oil consumption per ton of CPC during the year was 0.50 litres/MT as against 0.57 litres/MT in the previous year due to better process control. Furnace Oil consumption per MT of CPC has increased from 0.38 litres/MT to 0.68 litres/MT for heating & cooling of the Kiln. Furnace Oil used for processing has decreased from 0.82 litres/MT to 0.07 litres/MT due to concerted efforts and continuous monitoring of process parameters. The average production per day was 333.30 MT during the year, which is a decrease by 21.63 MT/day of the previous year. The power cost per MT of CPC has increased by Rs. 44.49/ MT compared to previous year, this is due to partial operation of the Plant during the months of June and July 2018 and nonoperation during the months of November and December 2018. In addition, the DG set had to be used due to frequent power outage.
(ii) the steps taken by the company for utilising alternate sources of energy 1) Replaced normal light fittings of 12,190 watts with LED light fittings of 2,900 watts 1) Additional transperant FRP sheets provided in CPC storage for using natural light. The consumption of Furnace oil for production was nil as in the previous year.
2) Conditioned monitoring of equipments & strict monitoring for efficient usage of equipment is being continued in all sections. 2) Installed energy efficient luminaries.
(iii) the capital investment on energy conservation equipments 3) Initiation to install energy efficient motors.

 

(B) Technology Absorption
(i) the efforts made towards technology absorption. a The Company has been continuously making efforts to achieve reduction in energy consumption and higher product recovery with consistent reviews of all processes and operations and consequent improvement actions like recently installed bag filters. The Company is also making all round efforts to improve on the efficiency of the production of CPC quality by experimenting various specifications of raw materials and its blends.
(ii) the benefits derived like product improvement, cost reduction, product development or import substitution.
(iii) in case of imported technology (imported during the last three years reckoned from the beginning of the financial year)- A
(a) the details of technology imported;
(b) the year of import; - Not Applicable
(c) whether the technology has been fully absorbed; f
(d) if not fully absorbed, areas where absorption has not taken place, and the reasons thereof; and
(iv) the expenditure incurred on Research and Development.
(C) Foreign Exchange Earnings and Outgo
The Foreign Exchange earned in terms of actual inflows during the year and the Foreign Exchange outgo during the year in terms of actual outflows. Foreign Exchange used for importing raw material, interest on foreign currency loans and travel expenses of employees for official work etc. were equivalent to Rs. 40,085.15 lakhs.
Foreign Exchange earned during the year 2018-19 was Nil.