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Harish Textile Engineers Ltd Directors Report

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Jul 18, 2024|12:00:00 AM

Harish Textile Engineers Ltd Share Price directors Report

To the Members,

Your Directors are pleased to present the 13th Annual Report on the business and operations of Harish Textile Engineers Limited ("the Company") along with the Audited Financial Statements for the financial year ended March 31,2023.

1. FINANCIAL HIGHLIGHTS:

(Rs. In Lakhs)

Particulars

Year ended 31/03/2023 Year ended 31/03/2022

Gross Income

11,771.46 10,732.12

Profit Before Interest and Depreciation

756.83 777.63

Finance Charges

526.34 489.69

Gross Profit

230.49 287.94

Provision for Depreciation

220.15 222.02

Net Profit Before Tax

10.34 65.92

Provision for Tax (Net of reversal)

13.60 17.64

Net Profit After Tax

-3.26 48.282

Balance of Retained Earning brought forward

623.33 575.04

Balance of Retained Earning carried forward

620.07 623.33

2. MANAGEMENT DISCUSSIONS AND ANALYSIS:

Pursuant to Regulation 34 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements), Regulation 2015 ("Listing Regulations"), the Management Discussion and Analysis Report for the year under review, is present in separate section as Annexure I, forming part of Annual Report.

3. DIVIDEND:

With a view to plough back the profits of the Company and keeping in mind the expansion of business activities, the Board of Directors consider it prudent and recommend not declaring any dividend for the year ended March 31,2023.

4. TRANSFER TO RESERVES:

The entire balance in Retained Earning is proposed to be carried forward.

5. TRANSFER OF UNCLAIMED DIVIDEND TO INVESTOR EDUCATION AND PROTECTION FUND:

The Provisions of Sec.125 (2) of the Companies Act, 2013 do not apply as there was no dividend declared and paid last year.

6. MATERIAL CHANGES AND COMMITMENTS, IF ANY, AFFECTING THE FINANCIAL POSITION OF THE COMPANY WHICH HAVE OCCURRED BETWEEN THE END OF THE FINANCIAL YEAR OF THE COMPANY TO WHICH THE FINANCIAL STATEMENTS RELATE AND THE DATE OF THE REPORT:

There were no material changes and commitments, affecting the financial position of the Company which has occurred between the end of the financial year of the Company and the date of the Directors report.

7. DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS IMPACTING THE GOING CONCERN STATUS AND COMPANYS OPERATIONS IN FUTURE:

• One Mr. Nikhil H Gandhi, Mrs. Kumudben H. Gandhi and Mrs. Chayya N. Gandhi, have filed a company petition no. 128 of 2022 on April 04 2022 in the Honble NCLT, Mumbai, inter alia contending that the Slump Sale of Non-Woven and PSF Business made by Pacific Harish Industries Limited (PHIL) to the company in FY 2019-20 was made without their consent as Shareholders of PHIL and hence, they have claimed that such Slump Sale is illegal. In this petition, the company has been made one of the Respondents. This matter is Sub-Judice.

• In NCLT (National Company Law Tribunal) Petition No. 128 of 2022 received via email in the month of April, 2022 from the advocate/legal representative of petitioner Mr. Nikhil H. Gandhi & two Ors. (Mrs. Chhaya Nikhil Gandhi and Mrs. Kumudben Himatlal Gandhi) against Pacific Harish Industries Ltd. & eight Ors. (Mr. Sandeep K. Gandhi, Mr. Hitendra C. Desai, Mr. Manish K. Vagadia, Mrs. Shaila S. Gandhi, Harish Textile Engineers Limited, Kasha Textile Private Limited, Mr. Kirtikumar S. Gandhi and M/s. K. M. Swadia & Co.), Harish Textile Engineers Limited is respondent no. six, and Mr. Sandeep Gandhi is respondent no. two. Honble NCLT (National Company Law Tribunal), Mumbai had passed an Ex-parte Order in response to Interim Relief application moved by Nikhil H. Gandhi & two Ors., vide this order, Honble NCLT Mumbai has passed a status quo order against Pacific Harish Industries Limited. In this order, there is nothing against Harish Textiles Engineers Limited.

• Being aggrieved by this Ex-parte order, Mr. Sandeep K. Gandhi, Mr. Kirtikumar S. Gandhi and Mrs. Shaila S. Gandhi (Major Shareholders of Pacific Harish Industries Limited) have filed an appeal with Honble NCLAT (National Company Law Appellate Tribunal), New Delhi against this Ex-parte order. In this appeal to Honble NCLAT (National Company Law Appellate Tribunal), Harish Textile Engineers Limited is made a respondent.

• We reiterate that in the order appeal against, nothing is against the Company "Harish Textile Engineers Limited". The appeal petition has not been served on us.

8. DETAILS OF HOLDING / SUBSIDIARY / JOINT VENTURES / ASSOCIATE COMPANIES:

The Company does not have any Holding/Subsidiary/Joint Ventures/Associate Companies.

9. DECLARATION BY INDEPENDENT DIRECTORS:

The Independent Directors have submitted their disclosures to the Board indicating that they comply with all the requirements that are stipulated in Section 149(6) of the Companies Act, 2013 and Regulation 16(1 )(b) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 so as to qualify themselves to act as Independent Directors in the Company. Further, they have also declared that they are not aware of any circumstance or situation, which exists or may be reasonably anticipated, that could impair or impact their ability to discharge their duties with an objective independent judgment and without any external influence.

The Independent Directors of the Company have complied with the requirements of the provisions in relation to the Independent Directors Databank as stated in the Companies (Creation and Maintenance of databank of Independent Directors) Rules, 2019 and the Companies (Appointment and Qualification of Directors) Rules, 2014 as amended from time to time.

10. DIRECTORS AND KEY MANAGERIAL PERSONNEL:

As on March 31, 2023, the Company has five Directors comprising of two Executive Directors and three Non-Executive Directors out of which all three are Independent Directors. There is one woman director.

Pursuant to the provisions of Section 149 of the Companies Act, 2013 ("the Act"), the independent directors have submitted declarations that each of them meets the criteria of independence as provided in Section 149(6) of the Act along with Rules framed thereunder and Regulation 16(1 )(b) of the SEBI Listing Regulations. There has been no change in the circumstances affecting their status as independent directors of the Company.

During the year under review, the non-executive directors of the Company had no pecuniary relationship or transactions with the Company, other than sitting fees, commission, if any and reimbursement of expenses incurred by them for the purpose of attending meetings of the Board / Committee of the Company.

Pursuant to the provisions of Section 203 of the Companies Act, 2013 read with the rules thereunder, the Key Managerial Personnel (KMP) of the Company as on March 31,2023 are:

Sr. No. Name

Designation

1 Mr. Sandeep Gandhi

Managing Director

2 Mr. Hitendra Desai

Whole-Time Director

3 Mr. Pinkesh Upadhyay

Chief Financial Officer

4 Ms. Priya Gupta

Company Secretary

11. REMUNERATION TO DIRECTOR AND EMPLOYEES:

Details/Disclosures of ratio of remuneration to each Director to median employees remuneration as required pursuant to Section 197(12) of the Companies Act 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 and details of remuneration paid to Employees vide Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are given in Annexure- V.

12. NOMINATION REMUNERATION COMMITTEE:

The Board has, on the recommendation of the Nomination & Remuneration Committee framed a policy for selection and appointment of Directors, Senior Management and their remuneration.

Nomination Remuneration and Compensation Committee Policy (NRC Committee)

The NRC Committee of the Company is formed by the Board of Directors. The NRC Committee consists of minimum three non-executive directors out of which two are independent directors. The Chairman of the NRC Committee is an independent director. No member of the NRC Committee have a relationship that may interfere with his independence from management and the Company or with the exercise of his duties as a NRC committee member. The NRC Committee may invite such of the executives of the Company, as it considers appropriate (and particularly the Managing Director) to be present at the meetings of the NRC committee, but on occasions it may also meet without the presence of any executives of the company. The Company Secretary shall act as the secretary to the NRC Committee.

The terms of reference of the NRC, is uploaded on the Companys website.

Remuneration Policy:

The Remuneration policy of your Company is a comprehensive policy which is competitive, in consonance with the industry practices and rewards good performance of the employees of the Company. The policy ensures equality, fairness and consistency in rewarding the employees on the basis of performance against set objectives. Remuneration of employees largely consists of basic remuneration and performance incentives. The Company while deciding the remuneration package takes into consideration the employment scenario, remuneration package of the industry and the remuneration package of other Industries.

The Remuneration of the Executive Directors is decided by the Nomination and Remuneration Committee based on criteria such as industry benchmarks, the companys performance vis-avis the industry performance, track record of the Executive Directors.

The Nomination and Remuneration committee met thrice during the year dated 05th September, 2022, 03rd October, 2022 and 15th December, 2022. Company Secretary of the Company acted as the Secretary to the Committee.

The members of the Nomination and Remuneration Committee and their attendance at committee meetings are as under:

Name of the Director

Category No. of Meetings attended

Mr. Ritesh Patel

Non-Executive & Independent Director 3

Mrs. Meena Mistry

Non-Executive & Independent Director 3

Mr. Nainesh Trivedi

Non-Executive & Independent Director 3

The Company has not issued any Stock options to the Directors. Independent Directors of the Company have disclosed that they do not hold any Equity Shares of the Company. There has been no pecuniary relationship or transactions of the Non-Executive Directors vis-a-vis the Company during the year under review.

13. AUDITORS Statutory Auditor

At the Ninth AGM held on September 30, 2019 the Members approved re-appointment of M/s. K.M. Swadia & Co. Chartered Accountants, (ICAI Firm Registration No. 110740W) as Statutory Auditors of the Company to hold office for a period of five years from the conclusion of that AGM till the conclusion of the fourteenth AGM, subject to ratification of their appointment by Members at every AGM, if so required under the Act. The requirement to place the matter relating to appointment of auditors for ratification by Members at every AGM has been done away by the Companies (Amendment) Act, 2017 with effect from May 7, 2018. Accordingly, no resolution is being proposed for ratification of re-appointment of statutory auditors at the ensuing AGM and a note in respect of same has been included in the Notice for this AGM. Auditors have confirmed that they are not disqualified to act as Auditors and are eligible to hold office as Auditors of your Company. They have also confirmed that they hold a valid peer review certificate as prescribed under Listing Regulations.

Cost Auditor

During the year under review, in accordance with Section 148(1) of the Act, the Company has maintained the accounts and cost records, as specified by the Central Government. The Board of Directors had appointed M/s. Y S Thakar & Associates, (Membership No. 9688 & Firm Registration No.: 000318), as Cost Auditors of the Company, for conducting the audit of cost records for the financial year ended March 31, 2023. The audit is in progress and the report will be filed with the Ministry of Corporate Affairs within the prescribed period.

The proposal for ratification of remuneration of the Cost Auditors for the financial year 2022-23 is placed before the Members for ratification/ approval.

Secretarial Auditor

Pursuant to the provisions of Section 204 of the Act, read with Rule 9 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Board, at its meeting held on February 14, 2023 have appointed M/s. D N Vora & Associates (ACS No.: 46989, CP No. 21254), Company Secretary in Practice, Mumbai to conduct the Secretarial Audit of the Company for the financial year ended March 31,2023. The Company has received consent from M/s. D N Vora & Associates to act as the Secretarial Auditor of the Company.

Report of Secretarial Auditors for the F.Y 2021-2022 in Form MR-3 is annexed to this report as Annexure-lll.

14. STATUTORY AUDITORS REPORT

The Auditors Report contains one Qualification regarding non provision of Gratuity Liability on actuarial basis as required by Ind AS 19. The company is in the process of getting the liability ascertained on actuarial basis and in the current year hopes to provide for the same. Notes to Accounts and Auditors remarks in their report are self-explanatory and do not call for any further comments.

15. CORPORATE GOVERNANCE

Non-applicability of Corporate Governance provisions of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015:

Pursuant to the provisions of Regulation 15(2) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, compliance with the provisions of Regulations 17,18,19,20,21,22,23,24,25,26,27, and clauses (b) to (i) of sub-regulation 2 of Regulation 46 and para C, D & E of Schedule V of the Securities and Exchange Board of India (Listing Obligations and Disclosures Requirements) Regulations, 2015, are not applicable to theCompanies having paid up equity share capital not exceeding Rs. 10 Crore and Net Worth not exceeding Rs. 25 Crore, as on the last day of previous financial year.

In view of above, as per the latest Audited Financial Statement of the Company as at March 31 2023, the paid-up Equity Share Capital and the Net Worth of the Company does not exceed the respective threshold limit of Rs. 10 Crore and Rs. 25 Crore, as aforesaid; hence corporate governance report has not been enclosed to Directors Report since the same is not applicable to the Company.

16. COMPLIANCE WITH SECRETARIAL STANDARDS

The Directors have devised proper systems to ensure compliance with the provisions of all applicable Secretarial Standards issued by the Institute of Company Secretaries of India and that such systems are adequate and is operating effectively.

17. CODE OF CONDUCT FOR DIRECTORS AND SENIOR MANAGEMENT

The Directors and members of Senior Management have affirmed compliance with the Code of Conduct for Directors and Senior Management of the Company. The copies of Code of Conduct as applicable to the Executive Directors (including Senior Management of the Company) and Non-Executive Directors are uploaded on the website of the Company.

18. FAMILIARIZATION PROGRAM FOR INDEPENDENT DIRECTORS

The Independent directors of Harish Textile Engineers Limited are eminent personalities having wide experience in the field of business, finance, education, industry, commerce and administration. Their presence on the Board has been advantageous and fruitful in taking business decisions.

The Company has practice of conducting familiarization program of the Independent directors. Independent Directors are appointed as per policy of the Company, with management expertise and wide range of experience. The Directors appointed by the Board are given induction and orientation with respect to the Companys vision, strategic direction, core values, including ethics, corporate governance practices, financial matters and business operations by having one-to-one meetings.

The new Board members are also requested to access the necessary documents / brochures, Annual Reports and internal policies available at our website www.harishtextile.com enable them to familiarize with the Companys procedures and practices.

Updates on relevant statutory changes encompassing important laws are regularly intimated to the Independent Directors. Their presence on the Board has been advantageous and fruitful in taking Business decisions.

Pursuant to Regulation 25(7) of the Listing Regulations, the Company has put in place a system to familiarize its Independent Directors about the Company, its financial products, theindustry and business model of the Company and its subsidiary. Pursuant to Regulation 46 of Listing Regulations the details of Familiarization Programme is uploaded on the Companys website.

19. DOCUMENTS PLACED ON THE WEBSITE OF THE COMPANY:

The following documents have been placed on the website in compliance with the Act:

• Financial statements of the Company and consolidated financial statements along with relevant documents as per third proviso to Section 136(1).

• Details of Vigil mechanism for directors and employees to report genuine concerns as per proviso to Section 177(10).

• Latest Announcements

• Annual Reports

• Annual Return

• Shareholding Pattern

• Code of Conduct

• Policies

• Nomination and Remuneration Policy

• Materiality Policy under Regulation 30 of SEBI (LODR) Regulations, 2015

• Scrutinisers Report

• Window and Book Closure

• Newspaper Advertisement

• Notice of Board Meeting and General Meeting

20. HUMAN RESOURCE MANAGEMENT (MATERIAL DEVELOPMENTS IN HUMAN RESOURCES / INDUSTRIAL RELATIONS FRONT, INCLUDING NUMBER OF PEOPLE EMPLOYED):

The Company offers a growth environment along with monetary benefits in line with industry standards. The Company has a number of employee initiatives to attract, retain and develop talent in the organization. The industrial relations during the year were cordial on all the fronts. The number of people employed in the year of report were 141.

21. SECRETARIAL AUDIT REPORT:

Pursuant to Section 204 of the Companies Act, 2013, the Company had appointed, M/s D N Vora & Associates, Practicing Company Secretary as its Secretarial Auditor to conduct the Secretarial Audit of the Company for the F.Y 2022-2023. The Company has provided all the assistance and facilities to the Secretarial Auditor for conducting their audit. Report of Secretarial Auditors for the F.Y 2022-2023 in Form MR-3 is annexed to this report as Annexure-lll.

22. EXPLANATION OR COMMENTS ON QUALIFICATIONS, RESERVATIONS OR ADVERSE REMARKS MADE BY AUDITORS AND THE PRACTICING COMPANY SECRETARY IN THEIR REPORTS:

The Statutory Auditors Report contains one Qualification regarding non provision of Gratuity Liability on actuarial basis as required by Ind AS 19. The company is in the process of getting the liability ascertained on actuarial basis and in the current year proposes to provide for the same. Notes to Accounts and Auditors remarks in their report are self-explanatory and do not call for any further comments.

The Secretarial Audit Report, however contains the following observation from Secretarial Auditor-

a) There were a few forms which were filled with additional fees. Except these, The Company has filed the required forms and returns with the Registrar of Companies (ROC) within the time prescribed under the Act However, no forms or returns were filed with the Regional Director, Central Government, Company Law Board/The Tribunal, Court or other authorities.

b) The Website of the Company is not updated as required to be maintained Regulation 46 of SEBI Listing (Obligations and Disclosure Requirements) Regulations 2015.

Management Response:

a) Due to technical issues of the sites and un-avoidable reasons only few forms were filed with additional fees for the financial year 2022-2023.

b) The Company has started the process to update the website and till date majority of updating as per Regulation 46 of SEBI Listing (Obligations and Disclosure Requirements) Regulations 2015 has taken place already. On the recommendation of the Practicing Company Secretary and other professionals, the Company will further update the website (if required) with the required data and documents.

23. SHARE CAPITAL:

The Paid up Equity Share Capital as on March 31, 2023 was Rs. 3,33,60,000 divided into 33,36,000 Equity shares of Rs. 10 each, which is same as at the previous year end.

24. SHARES/ DEBENTURES:

a. Buyback of Securities: The Company has not bought back any of the securities during the year under review.

b. Sweat Equity: The Company has not issued any sweat equity shares during the year under review.

c. Employee Stock Option Plan: The Company has not provided any stock options to the employees.

d. Non-Convertible Debentures:

1. During the year under review, the Company had issued 4,23,209 Non-convertible debentures at a single terms for all the Debenture Holders on 21/09/2022 at a face value of Rs. 100 /-; to the creditors on conversion of their outstanding amount.

2. The Company had redeemed 92,780 7% Non-Convertible Debentures of Rs. 100 each aggregating to Rs. 92,78,000/- during the year.

25. CREDIT RATING:

Company is in process of getting Credit Rating by the External Credit Rating Agencies.

26. PROCEEDING PENDING UNDER THE INSOLVENCY AND BANKRUPTCY CODE, 2016:

During the year under review, no application has been made nor any proceeding are pending under the Insolvency and Bankruptcy Code, 2016 against the company.

27. ONE-TIME SETTLEMENT AND VALUATION:

During the year under report, there was no one-time Settlement with any of the banks or lenders.

28. COMPLIANCE WITH SECRETARIAL STANDARDS:

Your Company is in compliance with the applicable Secretarial Standards issued by the Institute of Company Secretaries of India and approved by the Central Government under Section 118(10) of the Companies Act, 2013.

29. REPORTING OF FRAUDS BY AUDITORS:

During the year under review, neither the statutory auditors nor the secretarial auditor has reported to the audit committee, under Section 143 (12) of the Companies Act, 2013, any instances of fraud committed against your Company by its officers or employees, the details of which would need to be mentioned in the Directors report.

30. DEPOSITS FROM PUBLIC:

The Company has not accepted any deposits from public and as such, no amount on account of principal or interest on deposits from public was outstanding as on the date of the balance sheet.

31. DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to the provisions of clause (c) of sub-section (3) of Section 134 of the Companies

Act, 2013, the Directors confirm that, to the best of their knowledge and belief:

(a) In the preparation of the annual accounts, the applicable accounting standards had been followed along with no material departures;

(b) 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 and loss of the Company for that period;

(c) They have taken proper and sufficient care, to the best of their knowledge and ability, for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

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

(e) They have laid down internal financial controls to be followed by the Company and that such internal financial are adequate and were operating effectively;

(f) They have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

32. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, RESEARCH & DEVELOPMENT AND FOREIGN EXCHANGE EARNINGS AND OUTGO:

Information pursuant to Section 134(3)(m) of the Companies Act 2013 read with Rule 8(3) the Companies (Accounts) Rules, 2014 forming part of Directors Report for the year ended March 31,2023 is as under:

Conservation of Energy: The Companys operations involve low energy consumption. However efforts to conserve and optimise the use of energy through improved operational methods and other means will continue.

Technology Absorption: The Technology available and utilized is continuously being upgraded to improve overall performance and productivity.

Research & Development: Your Company believes that research & development is a continuous process for sustained corporate excellence. Our research & development activities help us in product and service improvement, effective time management and are focused to provide unique benefits to our customers. Such methods do not involve any specific cost burden to the Company.

Foreign Exchange Earnings: Rs. 93,73,547/- (previous year Rs. 3,79,18,153/-)

Foreign Exchange Outgo: Rs. 88,17,386/- (previous year Rs. 4,86,71,027/-)

33. BOARD EVALUATION

Pursuant to the provisions of the Companies Act, 2013, the Board has carried out an annual performance evaluation of its own performance, the directors individually as well as the evaluation of the working of its Audit, Nomination & Remuneration Committee.

a. Criteria for Performance Evaluation of Independent Directors includes

b. Attendance and Participation.

c. Maintaining confidentiality.

d. Acting in good faith and in the interest of the company as a whole.

e. Exercising duties with due diligence and reasonable care.

f. Complying with legislations and regulations in letter and spirit.

g. Openness to ideas, perspectives and opinions and ability to challenge old practices and throwing up new ideas for discussion.

h. Capacity to effectively examine financial and other information on operations of the company and the ability to make positive contribution thereon.

The performance of the Board was evaluated by the Board after seeking inputs from all the directors on the basis of criteria such as the board composition and structure, effectiveness of board processes, information and functioning, etc.

The performance of the committees was evaluated by the board after seeking inputs from the committee members on the basis of criteria such as the composition of committees, effectiveness of committee meetings, etc.

The above criteria are broadly based on the Guidance Note on Board Evaluation issued by the Securities and Exchange Board of India on January 5, 2017.

In a separate meeting of independent directors, performance of non-independent directors, the Board as a whole and the Chairman of the Company was evaluated, taking into account the views of executive directors and non-executive directors.

The Board expressed its satisfaction on the performance of all the directors, Board and its committees which reflected the overall engagement of the directors, the Board and its committees with the Company.

34. LISTING OF SHARES

The Shares of the Company is listed on BSE Limited. Applicable listing fees have been paid up to date. The Shares of the Company have not been suspended from trading at any time during the year by the concerned Stock Exchanges.

35. NUMBER OF MEETINGS OF THE BOARD:

During the year, 20 Board Meetings were held.

The dates on which the Board Meetings were held along-with attendance are as follows:

SR. NO.

BOARD MEETING DATE DIRECTORS PRESENT

1

28-04-2022 1. Sandeep Gandhi

2. Hitendra Desai

3. Ritesh Patel

4. Nainesh Trivedi

5. Meena Mistry

2

30-05-2022 1. Sandeep Gandhi

2. Hitendra Desai

3. Ritesh Patel

4. Nainesh Trivedi

5. Meena Mistry

3

14-06-2022 1. Sandeep Gandhi

2. Hitendra Desai

3. Ritesh Patel

4. Nainesh Trivedi

5. Meena Mistry

4

29-06-2022 1. Hitendra Desai

2. Ritesh Patel

3. Nainesh Trivedi

4. Meena Mistry

‘5

05-07-2022 1. Sandeep Gandhi

2. Hitendra Desai

3. Ritesh Patel

4. Nainesh Trivedi

5. Meena Mistry

6

04-08-2022 1. Sandeep Gandhi

2. Hitendra Desai

3. Ritesh Patel

4. Nainesh Trivedi

5. Meena Mistry

7

10-08-2022 1. Sandeep Gandhi

2. Hitendra Desai

3. Ritesh Patel

4. Nainesh Trivedi

5. Meena Mistry

8

05-09-2022 1. Sandeep Gandhi

2. Hitendra Desai

3. Ritesh Patel

4. Nainesh Trivedi

5. Meena Mistry

9

21-09-2022 1. Sandeep Gandhi
2. Hitendra Desai

3. Ritesh Patel

4. Nainesh Trivedi

5. Meena Mistry

10

30-10-2022 1. Sandeep Gandhi

2. Hitendra Desai

3. Ritesh Patel

4. Nainesh Trivedi

5. Meena Mistry

11

17-10-2022 1. Sandeep Gandhi

2. Hitendra Desai

3. Ritesh Patel

4. Nainesh Trivedi

5. Meena Mistry

12

31-10-2022 1. Sandeep Gandhi

2. Hitendra Desai

3. Ritesh Patel

4. Nainesh Trivedi

5. Meena Mistry

13

03-11-2022 1. Sandeep Gandhi

2. Hitendra Desai

3. Ritesh Patel

4. Nainesh Trivedi

5. Meena Mistry

14

14-11-2022 1. Sandeep Gandhi

2. Hitendra Desai

3. Ritesh Patel

4. Nainesh Trivedi

5. Meena Mistry

15

19-11-2022 1. Sandeep Gandhi
2. Hitendra Desai

3. Ritesh Patel

4. Nainesh Trivedi

5. Meena Mistry

16

15-12-2022 1. Sandeep Gandhi

2. Hitendra Desai

3. Ritesh Patel

4. Nainesh Trivedi

5. Meena Mistry

17

02-01-2023 1. Sandeep Gandhi

2. Hitendra Desai

3. Ritesh Patel

4. Nainesh Trivedi

5. Meena Mistry

18

13-02-2023 1. Sandeep Gandhi

2. Hitendra Desai

3. Ritesh Patel

4. Nainesh Trivedi

5. Meena Mistry

19

14-02-2023 1. Sandeep Gandhi

2. Hitendra Desai

3. Ritesh Patel

4. Nainesh Trivedi

5. Meena Mistry

20

24-03-2023 1. Sandeep Gandhi

2. Hitendra Desai

3. Ritesh Patel

4. Nainesh Trivedi

5. Meena Mistry

36. INTERNAL FINANCIAL CONTROL SYSTEM

The details in respect of internal financial control and their adequacy are included in the Management Discussion and Analysis (Annexure I), which is a part of this report.

37. COMPOSITION OF AUDIT COMMITTEE:

The composition of the Audit Committee is as under and it is in compliance with the provisions of Section 177 of the Companies Act, 2013 read with the rules thereunder and Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulation, 2015 ("SEBI Listing Regulations").

During the year, 20 Audit Committee Meetings were held.

The dates on which the Audit Committee Meetings were held along-with attendance are as follows:

SR. NO.

AUDIT COMMITTEE MEETING DATE COMMITTEE MEMBERS PRESENT

1

28-04-2022 1. Hitendra Desai

2. Ritesh Patel

3. Nainesh Trivedi

4. Meena Mistry

2

30-05-2022 1. Hitendra Desai

2. Ritesh Patel

3. Nainesh Trivedi

4. Meena Mistry

3

14-06-2022 1. Hitendra Desai

2. Ritesh Patel

3. Nainesh Trivedi

4. Meena Mistry

4

29-06-2022 1. Hitendra Desai

2. Ritesh Patel

3. Nainesh Trivedi

4. Meena Mistry

‘5

05-07-2022 1. Hitendra Desai

2. Ritesh Patel

3. Nainesh Trivedi

4. Meena Mistry

6

04-08-2022 1. Hitendra Desai

2. Ritesh Patel

3. Nainesh Trivedi

4. Meena Mistry

7

10-08-2022 1. Hitendra Desai

2. Ritesh Patel

3. Nainesh Trivedi

4. Meena Mistry

8

05-09-2022 1. Hitendra Desai

2. Ritesh Patel

3. Nainesh Trivedi

4. Meena Mistry

9

21-09-2022 1. Hitendra Desai

2. Ritesh Patel

3. Nainesh Trivedi

4. Meena Mistry

10

30-10-2022 1. Hitendra Desai

2. Ritesh Patel

3. Nainesh Trivedi

4. Meena Mistry

11

17-10-2022 1. Hitendra Desai

2. Ritesh Patel

3. Nainesh Trivedi

4. Meena Mistry

12

31-10-2022 1. Hitendra Desai

2. Ritesh Patel

3. Nainesh Trivedi

4. Meena Mistry

13

03-11-2022 1. Hitendra Desai
2. Ritesh Patel

3. Nainesh Trivedi

4. Meena Mistry

14

14-11-2022 1. Hitendra Desai

2. Ritesh Patel

3. Nainesh Trivedi

4. Meena Mistry

15

19-11-2022 1. Hitendra Desai

2. Ritesh Patel

3. Nainesh Trivedi

4. Meena Mistry

16

15-12-2022 1. Hitendra Desai

2. Ritesh Patel

3. Nainesh Trivedi

4. Meena Mistry

17

02-01-2023 1. Hitendra Desai

2. Ritesh Patel

3. Nainesh Trivedi

4. Meena Mistry

18

13-02-2023 1. Hitendra Desai

2. Ritesh Patel

3. Nainesh Trivedi

4. Meena Mistry

19

14-02-2023 1. Hitendra Desai

2. Ritesh Patel

3. Nainesh Trivedi

4. Meena Mistry

20

24-03-2023 1. Hitendra Desai

2. Ritesh Patel

3. Nainesh Trivedi

4. Meena Mistry

The members of the Audit Committee and their attendance at committee meetings are as u

Name of the Director

d

Category No. of Meetings attended

,Mr. Ritesh Patel

Chairman, Non-Executive & Independent Director 20

Mrs. Meena Mistry

Non-Executive & Independent Director 20

Mr. Hitendra Desai

Executive Director & Whole Time Director 20

Mr. Nainesh Trivedi

Non-Executive & Independent Director 20

The Committee in particular looks into:

a) Ensuring the organizations financial statements are understandable and reliable.

b) Ensuring the organization establishes a thorough risk management process and effective internal controls.

c) Reviewing the organizations policies, particularly in areas such as ethics, conflict of interest and fraud.

d) Reviewing the organizations litigation and regulatory proceedings.

e) Selecting and implementing a direct reporting relationship with the public accounting firm that serves as the organizations external auditor.

f) Establishing communication with the organizations internal auditor and reviewing all audit findings.

g) Look into the reasons for substantial defaults in the payment to the depositors, debenture holders, shareholders (in case of non-payment of declared dividends) and creditors.

h) Carrying out any other function as is mentioned in the terms of reference of the audit committee.

38. STAKEHOLDERS RELATIONSHIP COMMITTEE:

The stakeholders relationship committee is constituted in line with the provisions of Regulation 20 of SEBI Listing Regulations read with Section 178 of the Act.

Terms of reference

The Committee is responsible for assisting the Board of Directors in the Boards overall responsibilities relating to attending and redressal of the grievances of the security holders of the Company.

Functions

The Members of the stakeholders relationship committee met once during the financial year under review dated 02nd January, 2023. Company Secretary of the Company acted as the Secretary to the Committee.

The Composition of the Shareholders Relationship Committee constituted and details of the meetings attended by the Directors are given below.

The members of the stakeholders relationship committee and their attendance at committee meetings are as under:

Name of the Director

Category No. of Meetings attended

Mr. Ritesh Patel

Chairman, Non-Executive & Independent Director 1

Mrs. Meena Mistry

Non-Executive & Independent Director 1

Mr. Nainesh Trivedi

Non-Executive & Independent Director 1

Mr. Hitendra Desai

Executive & Whole-time Director 1

The Committee in particular looks into:

1. To oversee and review redressal of shareholder and investor grievances, on matters relating to transfer of securities, non-receipt of annual report, non-receipt of dividends/interests.

2. To review the measures taken for effective exercise of voting rights by shareholders.

3. To review the adherence to the service standards adopted by the Company in respect of various services being rendered by the Registrar & Share Transfer Agent.

4. To review the various measures and initiatives taken by the Company for reducing the quantum of unclaimed dividends and ensuring timely receipt of dividend warrants/annual reports/statutory notices by the shareholders of the company.

5. To issue duplicate share/debenture certificate(s) reported lost, defaced or destroyed as per the laid down procedure and to resolve the grievances of security holders of the Company, if any.

6. Attending to complaints of security holders routed by SEBI (SCORES)/Stock Exchanges/RBI or any other Regulatory Authorities.

7. Taking decision on waiver of requirement of obtaining the Succession Certificate/Probate of Will on case to case basis within the parameters set out by the Board of Directors.

8. To monitor transfer of the amounts/shares transferable to Investor Education and Protection Fund.

9. To list the securities of the Company on Stock Exchanges.

10. Any other matters that can facilitate better investor services and relations.

During the year under review, few queries/complaints were received during the year from shareholders/investors and all of them got resolved on time. The numbers of pending share transfers as on March 31,2023 were Nil.

39. VIGIL MECHANISM (WHISTLE BLOWER POLICY):

The Companys Whistle Blower policy provides a mechanism under which an employee/director of the Company may report unethical behaviour, suspected or actual fraud, violation of code of conduct and personnel policies of the Company. The Vigil Mechanism ensures standards of professionalism, honesty, integrity and ethical behaviour. The Whistle Blower Policy/Vigil Mechanism is uploaded on the Companys website.

40. RISK MANAGEMENT POLICY:

Risk Management Policy identifies, communicate and manage material risks across the organization. The policy also ensures that responsibilities have been appropriately delegated for risk management. Key Risk and mitigation measures are provided in the Management Discussion and Analysis annexed to the Annual Report.

41. CORPORATE SOCIAL RESPONSIBILITY:

The Company is not required to constitute a Corporate Social Responsibility Committee as it does not fall within the purview of Section 135(1) of the Companies Act, 2013 and hence it is not required to formulate policy on corporate social responsibility.

42. EXTRACT OF ANNUAL RETURN:

As required pursuant to Section 92(3) of the Companies Act, 2013 and rule 12(1) of the Companies (Management and Administration) Rules, 2014, an extract of annual return in MGT-9 as a part of this Annual Report annexed as Annexure-ll. The same is also available on the website of the company at the website- www.harishtextile.com.

43. PARTICULARS OF EMPLOYEE:

None of the employees of the Company is drawing remuneration in excess of the limits described under rule (5) (2) chapter XIII as provided under section 197 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014. The information required under section 197 of the act read with rule (5)(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are mentioned in the Annexure V.

44. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS:

Details of Loans, Guarantees and Investments covered under the provisions of Section 186 of the Companies Act, 2013 are given in the notes to the Financial Statements.

45. PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES:

The particulars of every contract or arrangements entered into by the Company with related parties referred to in sub-section (1) of Section 188 of the Companies Act, 2013 including certain arms length transactions under third proviso thereto have been disclosed in Form No. AOC-2 as Annexure-IV.

46. POLICY FOR PROHIBITION OF INSIDER TRADING:

Vide notification No. EBI/LAD-NRO/GN/2018/59 Securities and Exchange Board of India (SEBI) has notified SEBI (Prohibition of Insider Trading) (Amendment) Regulations, 2018. The Company has accordingly amended its Prohibition of Insider Trading Code and Code of Practices and Procedures for Fair Disclosure of Unpublished Price Sensitive Information. The Code also provides for pre-clearance of transactions by designated persons, whenever required.

The Company follows closure of trading window for the end of every quarter till 48 hours after the declaration of financial results. The Company has been advising the designated persons covered by the said Code not to trade in Companys securities during the closure of trading window period.

47. PREVENTION OF SEXUAL HARASSMENT AT WORKPLACE:

As per the requirements of the Sexual Harassment of Women at Workplace (Prevention, Prohibition & Redressal) Act, 2013 ("POSH Act") and Rules made thereunder, the Company has formed an Internal Committee to address complaints pertaining to sexual harassment in the workplace. The Company policy mandates prevention of sexual harassment and to ensure a free and fair enquiry process with clear timelines for resolution. During the year under review, there were no cases filed under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

48. INTERNAL AUDITORS:

Subsequent to the close of the year, as recommended by the Audit Committee, M/s Ravi H. Dasija & Co., Chartered Accountants have been re-appointed as an Internal Auditors of the Company for the three financial year with effect from FY 2022-2023 to 2024-2025.

49. ACKNOWLEDGEMENTS:

Your Directors thank the Companys Investors, Clients, Vendors, Bankers, Business and various governmental as well as regulatory agencies for their continued support and confidence in the management. Your Directors wish to place on record their deep sense of appreciation of the dedicated and sincere services rendered by employees at all levels during the year. Your Companys consistent growth was made possible by their hard work, solidarity, cooperation and support.

For and on behalf of the Board of Directors Harish Textile Engineers Limited

Sandeep Gandhi Managing Director DIN No. 00941665

Hitendra Desai Whole Time Director DIN No.: 00452481

Date: May 30, 2023 Place: Mumbai

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