Khandelwal Extra Director Discussions


Dear Members,

Your Directors have pleasure in presenting Companys 41 Annual Report and Audited Financial Statements for the financial year ended March 31st, 2023.

1. FINANCIAL RESULTS

(Rs. in Lakhs)

Other Income 87.53
Profit before Interest and Depreciation 39.91
Less : Interest 5.70
Depreciation 2.94

Tax Expense (including Deferred Tax)

11.79
Profit after tax 19.48
Other Comprehensive Income/(Loss) -
Total Comprehensive Income/(Loss) 19.48

2. HIGHLIGHTS OF PERFORMANCE

During the year, the Companys working resulted in profit before interest and depreciation of Rs. 39.91 Lacs. After adjustment of Interest, depreciation and tax, the year resulted in profit of Rs. 19.48 lakhs as compared to the profit of Rs. 29.71 lakhs in the previous year. The Companys assessment under Income Tax Act, 1961 is completed upto A.Y. 2022-23 and there was no outstanding demand.

Indian Accounting Standards (Ind-AS) IFRS Converged Standards.

The Company has adopted Indian Accounting Standards (Ind-AS) with effect from 1st April, 2017 pursuant to Ministry of Corporate Affairs notification of the Companies (Indian Accounting Standard) Rules, 2015 and the Annual Accounts of 2022-23, has been drawn in terms of provisions of the Ind-AS.

Future Outlook:

The present lease agreements of Godowns of the Company given on rent are upto 14.11.2023 but the management expects possibilities of its further renewal.

3. TRANSFER TO RESERVES

The Company has retained the amount of Rs. 19.48 lakhs in the Profit and Loss Account and no amount has been transferred to General Reserve.

4. DIVIDEND

During the year, the Board of Directors do not recommend any dividend on Equity shares.

5. SHARE CAPITAL

The Companys Authorized Capital remains unchanged at Rs. 200 Lakhs. The Paid up Equity Share Capital of the Company as on the date of Balance Sheet stands unchanged at Rs. 85,01,000/- (comprising of 8,50,100 Equity shares of Rs. 10/- each).

6. FIXED DEPOSITS

Your Company has not invited any deposits during the financial year under review.

7. SUBSIDIARIES

Your Company does not have any subsidiary within the meaning of the Companies Act, 2013. During the financial year ended 31 March 2023, no entity became or ceased to be the subsidiary, joint venture or associate of the Company.

8. DIRECTORS AND KEY MANAGERIAL PERSONNEL

a. In accordance with the provisions of Section 152 of the Companies Act, 2013 and Rules made thereunder, Mr. Dinesh Khandelwal (DIN: 00161831), Whole-time Director (Finance) & CFO retires by rotation at the ensuing Annual General Meeting and being eligible offers himself for re-appointment to the Board.

The tenure of Mr. VIshwa Nath Khandelwal( DIN: 00161893) designated as Whole-time Director (Works), who was appointed for five (5) years w.e.f 1 April, 2019 will expire on 31 March 2024. The Board on the recommendation of Nomination and Remuneration Committee has recommended for his reappointment as Whole-time Director (Works) for five (5) years period from 01.04.2024 on the remuneration detailed in the notice of AGM, subject to approval by members in the general meeting. Your Directors recommend the resolution for re-appointment of Mr. Vishwa Nath Khandelwal for your approval.

Pursuant to the Companies (Appointment and Qualification of Directors) Fifth Amendment Rules, 2019, all Independent Directors have registered their name in the data bank of Independent Directors.

All Independent Directors have given declarations of compliance of Rule 6(1) & (2) of Companies (Appointment and Qualification of Directors) Rules, 2014 as amended along with the declaration that they meet the criteria of independence as laid down under Section 149 (6) of the Companies Act, 2013.

b. During the month of November 2022, the company got the information regarding the sad demise of Mr. Anil Kamthan , Independent Director of the Company.

Pursuant to this casual vacancy, Mr. Anil Kamthan ceased to be the Independent Director of the Company w.e.f. 12.11.2022. The Board places on record its appreciation for the efforts and contribution received from Mr. Anil Kamthan during his tenure as the Independent Director of the Company and grieves about this loss. The Board also expresses their deep condolences to his family. His demise didnt affect the Composition of the Board and Committees of the Company and it remains in accordance with the applicable regulations.

c. Mr. Mohit Srivastava resigned from the position of Company Secretary and Compliance Officer of the Company w.e.f 12.08.2022. The Board places on record its appreciation for the efforts and contribution received from Mr. Mohit Srivastava during his tenure as the Company Secretary and Compliance Officer of the Company.

d. Ms. Satyansha Dubey was appointed as the Company Secretary and Compliance Officer of the Company w.e.f 13.08.2022. The aforesaid appointment was made pursuant to a detailed evaluation by the Nomination and Remuneration Committee members and their unanimous recommendation to the Board.

e. Mr. Dinesh Khandelwal (DIN: 00161831), Whole-time Director (Finance) & CFO; Mr. Vishwa Nath Khandelwal (DIN: 00161893), Whole-time Director (Works) and Ms. Satyansha Dubey, Company Secretary and Compliance Officer are the Key Managerial Personnel of the Company. Ms. Satyansha Dubey holds the position of Company Secretary and Compliance Officer w.e.f 13.08.2022 subsequent to the resignation of Mr. Mohit Srivastava from the same post.

9. BOARD EVALUATION

Pursuant to the provisions of the Companies Act, 2013; the Nomination and Remuneration Committee formulated the criteria for evaluation of the performance of the Board of Directors, its various Committees constituted as per the provisions of the Companies Act, 2013 and individual directors. Based on that, the Board of Directors carried out an annual evaluation of its own performance and of its various Committees viz. Audit Committee, Nomination and Remuneration Committee, Stakeholder Relationship Committee and Committee of Directors and expressed their satisfaction with its performance and performance of its Committees. The Board of Directors also evaluated the performance of individual Director on the basis of self-appraisal and expressed their satisfactory performance. The Board of Directors also carried out an annual performance evaluation of its Independent Directors and expressed their satisfaction with their functioning / performance.

In terms of Schedule IV to the Companies Act, 2013, the Independent Directors also convened a separate meeting for this purpose and evaluated the performance of Chairman and Non- Independent Directors.

10. REMUNERATION POLICY

The Board of Directors on the recommendation of the Nomination and Remuneration Committee has framed a policy which lays down a framework in relation to remuneration of Directors, Key Managerial Personnel and Senior Management of the Company. The Policy covers the criteria for selection and appointment of Board Members and senior management and their remuneration. The Companys Remuneration Policy is based on the principles of (i) Pay for Responsibility and Duties, (ii) Pay for Potential and (iii) Pay for growth of the Company.

The Nomination and Remuneration Committee is vested with powers to determine yearly increments/salary increase of Executive Directors/ KMPs and one level below based on their performance and contribution towards profitability and sustainability of Company. Non Executive Directors are paid only sitting fee which is decided by Nomination & Remuneration Committee.

11. RISK MANAGEMENT POLICY

The Companys business at present is limited to leasing out the godowns which have limited risk. As leasing to a renowned corporate entity has little risk.

12. INTERNAL CONTROL SYSTEM

The Company has an adequate system of internal control relating to purchase/repairs & maintenance items commensurate with the size of the Company and nature of its business. The Company has also Internal Control System for speedy compilation of Accounts and Management Information Reports and to comply with applicable laws and regulations. The Company has a well defined organizational structure, authority levels and internal rules and regulations for conducting business transactions suitable to the size of the business.

The Company has already formed an Audit Committee which met four times in a year. Audit Committee also ensures proper compliance with the provisions of The Companies Act, 2013 and also reviews the adequacy and effectiveness of the internal control environment and monitors implementation of internal audit recommendations. Besides the above, Audit Committee is actively engaged in overseeing financial disclosures and in reviewing your Companys risk management policies.

13. INTERNAL FINANCE CONTROLS

In accordance with Section 134(5) (e) of the Companies Act, 2013, the Company has Internal Financial Controls Policy by means of policies and procedures commensurate with the size & nature of its operations and pertaining to financial reporting. In accordance with Rule 8(5) (viii) of Companies (Accounts) Rules, 2014, it is hereby confirmed that the Internal Financial Controls are adequate with reference to the financial statements.

14. WHISTLE BLOWER POLICY/ VIGIL MECHANISM

The Company has a Whistle Blower Policy to report genuine concerns or grievances detrimental to the interest of the Company. The Whistle Blower Policy/ Vigil Mechanism has been posted on the website of the Company.

15. RELATED PARTY TRANSACTIONS

All related party transactions that were entered into during the financial year were on an arms length basis and in the ordinary course of business and the provisions of Section 188 of the Companies Act, 2013 are not attracted. 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 interest of the Company at large. Thus, disclosure in Form AOC-2 was not required. Details of transactions made are disclosed in financial statements. All related party transactions are presented to the Audit Committee and the Board. Omnibus approval of Audit Committee was obtained for the transactions which are foreseen and repetitive in nature.

16. STATUTORY AUDITORS AND THEIR REPORT

Pursuant to the provisions of Section 139 of the Companies Act, 2013 and the Rules made there under M/s. P.L. Tandon & Co., Kanpur, Chartered Accountants, (ICAI Registration No 000186C) were appointed as the Statutory Auditors of the Company to hold office for five consecutive years starting from the conclusion of the 40th Annual General Meeting (AGM) held on September 24, 2022 until the conclusion of the 45th AGM of the Company to be held in year 2027.

M/s. P.L. Tandon & Co. have confirmed their eligibility and qualification required under Sections 139, 141 and other applicable provisions of the Companies Act, 2013 and Rules issued thereunder (including any statutory modification(s) or re-enactment(s) thereof for the time being in force).

M/s. P.L. Tandon & Co., Kanpur, Chartered Accountants, (ICAI Registration No 000186C), have given their consent for the proposed appointment as Statutory Auditors of the Company from the conclusion of the ensuing Annual General Meeting of the members of the Company. They have further confirmed that the said appointment, if made, would be within the prescribed limits under Section 141(3)(g) of the Companies act, 2013 and that they are not disqualified for appointment.

There are no qualifications, reservations or adverse remarks or disclaimer made in the Auditors Report for the financial year ended 31 March, 2023 which requires any clarification or explanation by the Board of Directors.

17. SECRETARIAL AUDIT REPORT

Pursuant to the provisions of Section 204 of The Companies Act, 2013 and the Rules made there under, M/s. Banthia & Co, Practicing Company Secretary (CP No. 1405), Kanpur, were appointed to conduct the Secretarial Audit of the Company for the year ended 31 March, 2023.The Practicing Company Secretary has submitted his Report on the secretarial audit which is annexed as Annexure I to this Directors Report. The Secretarial Audit Report does not contain any adverse observation or qualification requiring explanation or comments from the Board under Section 134(3) (f) of the Companies Act, 2013. Further, he has been duly re-appointed to conduct the Secretarial audit of the company for the Financial Year 2023-24.

18. DETAILS IN RESPECT OF FRAUDS REPORTED BY AUDITORS

Pursuant to the provisions of Section 143 (12) of the Companies Act, 2013, no instance of fraud has been reported by the auditors against the Company.

19. DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to Section 134(5) of the Companies Act 2013, your Directors confirm that:

a) in the preparation of the annual accounts, the applicable accounting standards have been followed with no material departure:

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 income of the Company for the same period;

c) they have taken proper and sufficient care 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) they have prepared the annual accounts on a going concern basis;

e) they have laid down internal financial controls in the Company that are adequate and are operating effectively; and

f) they have devised proper systems to ensure compliance with the provisions of all applicable laws and that these are adequate and are operating effectively.

20. MATERIAL CHANGES AND COMMITMENTS

There are no material changes or commitments made by the Company affecting the financial position of the Company between the end of financial year and date of the Report.

21. DETAILS OF SIGNIFICANT & MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNAL

No significant and material orders have been passed by any Regulator or Court or Tribunal impacting the going concern status and Companys operations in future. Although,Reassessment of VAT cases of the Company, Input credit partially allowed due to manufacturing Exempt Goods (Deoiled Rice Bran) for the F.Y. 2016-17 & 2017-18 were finalized as decided by department and tax liability of Rs. 24.24 Lacs has been assessed and adjusted against VAT refund due. The Company has filed appeal under Judicial authorities of the VAT Tax against these orders.

22. CHANGE IN THE NATURE OF BUSINESS

The Company had closed manufacturing operations in 2018. During the F.Y. 2021-22 all the plant and machineries and stores and spare parts have been sold. It has leased out all godowns at year end of the Company situated at Akrampur-Magarwara, Distt. Unnao.

23. STATUTORY DISCLOSURES:

i. CORPORATE GOVERNANCE

The Company is exempted from compliance of Corporate Governance provisions as per SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015.

ii. ANNUAL RETURN

Pursuant to Section 92(3) read with Section 134(3)(a) of the Companies Act, 2013 the Annual Return as on 31 March, 2023 is available on the website of the Company and can be accessed at http://www.khandelwalextractions.com/announcements.html

iii. MEETINGS OF THE BOARD AND COMMITTEES HELD DURING THE

YEAR

a. The Board of Directors met four times during the year on 28.05.2022, 13.08.2022, 12.11.2022 and 11.02.2023. All the Directors were present in all the meetings.

b. The Audit Committee formed under Section 177 of Companies Act, 2013, consisting of Mr. Ashok Gupta, Chairman; Mr. Atul Bagla and Mr. K.N.Khandelwal met four times during the year on 28.05.2022, 13.08.2022, 12.11.2022 and 11.02.2023. All the members were present in all the meetings.

c. During the year, Nomination and Remuneration Committee consisting of Mr. Ashok Gupta, Chairman; Mr. Atul Bagla and Mr. K.N. Khandelwal met one time during the year on 13.08.2022. All the members of the said committee were present in the meeting.

d. The Stake Holders Relationship Committee consisting of Mr. Ashok Gupta, Chairman; Mr. K.N. Khandelwal and Mr. Dinesh Khandelwal met once on 25.03.2023 to take note of investor complaints/grievances. All the members of the said committee were present in the meeting.

e. Independent Directors held a meeting on 25.03.2023 to assess /evaluate the performance of Chairman and Non-Independent Directors and concluded their satisfaction on their performances.

iv. CORPORATE SOCIAL RESPONSIBILITY

Corporate Social Responsibility is not applicable to the Company.

v. DISCLOSURE UNDER SECTION 186: LOANS AND INVESTMENTS

Loans and investments were made for deployment of surplus funds which are within the limits as prescribed u/s 186 of the Companies Act, 2013. Details are given in financial statements annexed in the Annual Report for F.Y. 2022-23.

vi. CONSERVATION OF ENERGY

Not Applicable.

vii. TECHNOLOGY ABSORPTION

Not Applicable.

viii. IMPORTS / EXPORTS AND FOREIGN EXCHANGE EARNINGS AND OUTGO

There was no import/export and no foreign exchange earnings and outgo incurred during the year under review.

ix. REMUNERATION PAID TO EXECUTIVE DIRECTORS AND KEY

MANAGERIAL PERSONNAL

Details of remuneration paid to Directors, KMPs are given in Form No. MGT-9 (available on the website of the Company). Further, details as required under Rule 5(1) of The Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 read with section 197(12) of the Act, are same as per previous year. The Board appointed Ms. Satyansha Dubey as Company Secretary and Compliance Officer w.e.f 13.08.2022 on the recommendations of Nomination and Remuneration Committee. Her Remuneration was decided by the Nomination and Remuneration Committee which shall be subject to yearly performance evaluation and increment. Executive directors have been paid minimum remuneration as approved by the Shareholders. Non-executive Directors have been paid only sitting fees.

There was no employee getting salary in excess of the limit as specified under Rule 5(2) of The Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 read with section 197(12) of the Act, throughout or part of the year under review.

x. SEXUAL HARASSMENT OF WOMEN AT WORKPLACE

(PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013

No complaint has been received under the aforesaid Act during the year under reference.

24. ENVIRONMENT AND SAFETY

In the present business there is no generation of pollution of any sort. Security personnel are duly employed for safety of godowns/assets.

25. LISTING OF EQUITY SHARES

The Equity shares continue to be listed with BSE Ltd. The Company has paid the Annual Listing fee for the year 2022-23 to the said stock exchange.

26. DEMATERIALISATION OF SHARES/APPOINTMENT OF RTA

The Company has necessary arrangements with National Securities Depository Limited (NSDL) and Central Depository Services (India) Limited (CDSL) to enable the shareholders to dematerialize their shareholding in the Company for which they may contact the Depository Participant of the above Depository. The Companys ISIN No. is INE687W01010.

M/s Alankit Assignments Limited, New Delhi continues as its Registrar and Share Transfer Agent (RTA) for providing services in respect of transfer and dematerialization of securities of the Company with NSDL/CDSL.

27. MANAGEMENT DISCUSSSION AND ANALYSIS REPORT

The present leasing agreements of Godowns of the Company on rent are upto November 2023 and management expects for extension/renewal of the agreement.

28. COMPLIANCE WITH APPLICABLE SECRETARIAL STANDARD

The Company has complied with the applicable Secretarial Standards, SS-1 on Meetings of the Board of Directors and SS-2, SS-3 and SS-4 on General Meetings and Board Meeting issued by the Institute of Company Secretaries of India.

29. ACKNOWLEDGMENT

Your Directors thank all the Stakeholders including employees for their continued support to your Company.

FOR AND ON BEHALF OF THE BOARD

K N KHANDELWAL

Place: Kanpur

(CHAIRMAN)

Date: 12.08.2023

DIN : 00037250