MISHTANN FOODS LIMITED
1.STATE OF AFFAIRS OF THE COMPANY
The Company is primarily engaged in the agricultural business i.e manufacturing, processing & trading of rice, wheat, other food grains and salt.
(Amount in Rs.)
|Year Ended 31.03.2023
|Year Ended 31.03.2022
|Pro t/(Loss) before Tax
|Less: Taxes/Deferred Taxes
|Pro t/(Loss) After Taxes
|P& L Balance b/f
|Pro t/ (Loss) carried to Balance Sheet
Above mentioned gures are derived from audited Standalone Balance Sheet for the nancial year ended 31st March, 2023.
The total income for the nancial year ended March 31, 2023 stood at Rs. 650,43,16,779 as against the corresponding gures of previous nancial year which stood at Rs. 498,58,86,777 representing growth of 30.45%. The Standalone Pro t Before Tax (PBT) for the nancial year ended March 31, 2023 stood at Rs. 76,81,38,361 as against the corresponding igures of previous nancial year which stood at Rs. 47,26,94,403.
During the year under review, besides Basmati Rice which has been the forte of the company, the company has also consolidated its position in the edible common Salt market by introducing varieties viz. “ROCK SALT” and “CRYSTAL SALT” across all the markets under its brand name. Through this measure, the products of the company have penetrated all the major markets in the country and made a mark of its own. The company proposes to extend its business worldwide by incorporating its wholly owned subsidiaries in the renowned economic zones of the United Arab Emirates, Republic of Singapore and United States of America. The incorporation of the same will be completed in the next scal year. Because of these exemplary steps and growth trajectory of the Company, "Shri Hiteshkumar Guarishankar Patel- Managing Director of the Company was awarded with “Business Transformation Leaders 2022” Award organized by the “The Economic Times & Times Interact”.
4. SHARE CAPITAL
During the year under review, the Company has increased its
Authorised share capital twice, through Postal Ballot.
i. Change in authorised capital of the Company from 50,00,00,000 (Fifty Crores Rupees only) consisting of 50,00,00,000 (Fifty Crores) Equity Shares of 1/- (Rupee One) each to 100,00,00,000 (One Hundred Crores Rupees only) consisting of 100,00,00,000 (One Hundred Crores) Equity Shares of 1/- (Rupee One) each., E-voting of the said postal ballot started on 24th April, 2022 and ended on 24th May, 2022 and result of which declared on 25th May, 2022 with scrutinizers report.
ii. Change in authorised capital of the Company from 100,00,00,000 (One Hundred Crores Rupees only) consisting of 100,00,00,000 (One Hundred Crores) Equity Shares of 1/- (Rupee One) each to 130,00,00,000 (One Hundred and Thirty Crores Rupees only) consisting of 130,00,00,000 (One Hundred and Thirty Crores) Equity Shares of 1/- (Rupee One) each., E-voting of the said postal ballot started on 8th February, 2023 and ended on 9th March, 2023 and result of which declared on 13th March, 2023 with scrutinizers report.
During the year under review, the Company has allotted Bonus Issue 1:1 by issuing 50,00,00,000 (Fifty Crores Only) Equity shares of Rs. 1 each amounting to Rs. 50,00,00,000 (Fifty Crores Only) out of Free Reserves as per Financial Statements of the Company as on 31st march, 2022. The paid-up share capital of the company as on date is Rs. 100,00,00,000 (One Hundred Crores Only). As on 31st March, 2023 none of the Directors of the Company hold instruments convertible into Equity Shares of the Company.
The Board of Directors has recommended a Final Dividend @ Rs. 0.001/- per share (i.e. 0.1%) on equity shares of face value of Rs. 1/- each for the Financial Year ended March 31, 2023, subject to the approval of the shareholders in the ensuing Annual General Meeting. The Dividend Distribution Policy of the Company can be accessed at http://www.mishtann.com/uploads/speci cation/Dividend%20Di stribution%20Policy.pdf
In view of the changes made under the Income Tax Act, 1961, by the Finance Act, 2020, dividends paid or distributed by the Company shall be taxable in the hands of the Shareholders. The Company shall, accordingly, make the payment of the nal dividend after deduction of tax at source, wherever applicable.
TRANSFER OF UN-CLAIMED DIVIDENDS
6. GENERAL RESERVES
During the year under review Rs. 49,92,25,748/- has been
transferred to General Reserves.
7. CHANGE IN NATURE OF BUSINESS
During the Financial Year 2022-23 the Company has not commenced any new business nor discontinued/sold or disposed of any of its existing businesses or hived off any segment or division.
8. DETAILS OF SUBSIDIARY/JOINT VENTURES/ASSOCIATE
During the year under review, the company has incorporated new Wholly-owned Subsidiary of the Company i.e. Grow and Grub Nutrients FZ-LLC in U.A.E. on 19th April, 2023.
9. DIRECTORS AND KEY MANAGERIAL PERSONNEL
APPOINTED AND RESIGNED DURING THE YEAR
Mr. Hiteshkumar Patel, Managing Director (DIN: 05340865) and Mr. Keval Bhatt, Non-Executive and Non-Independent Director (DIN: 07620270), retire by rotation at the forthcoming Annual General Meeting and being eligible, offer himself for reappointment.
The term of appointment of Mr. Navinchandra Dahyalal Patel, Whole-Time Director (DIN: 05340874) of the Company completed on 27th August, 2022. The Board of Directors at their Meeting convened on 7th September, 2022 approves his reappointment and remuneration for the term of ve years with effect from 28th August, 2022 to 27th August, 2027 subject to the approval of the shareholders at the ensuing General Meeting
10. PARTICULARS OF EMPLOYEES & EMPLOYEE
Information 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 and a statement showing the names and other particulars of the employees drawing remuneration in excess of the limits set out in Rule 5(2) and 5(3) of the Companies (Appointment & Remuneration of Managerial Personnel) Rules, 2014 is annexed hereto as “Annexure A” and forms part of this report.
None of the employees of the Company drew remuneration in excess of the limits set out in the said rules during the year. No employee was in receipt of remuneration during the year or part thereof which, in the aggregate, at a rate which is in excess of the remuneration drawn by the managing director or whole-time director or manager and holds by himself or along with his spouse and dependent children, not less than two percent of the equity shares of the company. Hence, no information is required to be furnished as required under Rule, 5(2) and 5(3) of The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014.
11. BOARD MEETINGS
During the year, Seven Board Meetings were duly held. The details of which are given in the Corporate Governance Report. The intervening gap between the Meetings was within the period prescribed under the Companies Act, 2013.
The Board has following Committees, viz,
1. Audit Committee
2. Stakeholders Relationship Committee
3. Nomination and Remuneration Committee
4. Corporate Social Responsibility Committee
5. Risk Management Committee (constituted on 11th July, 2022)
The details of the Committees along with their composition, number of meetings and attendance at the meetings are provided in the Corporate Governance Report.
In pursuance of the Act and the Listing Regulation, the following policies have been framed and disclosed on the Companys website www.mishtann.com
I. Board Diversity Policy ii. Nomination and Remuneration Policy iii. Policy for determining Material subsidiaries iv. Policy on preservation of docs v. Related Party Transactions Policy vi. Terms and conditions of appointment of Independent Directors vii. Whistle Blower Policy viii. Familiarization program for Independent Directors ix. Fair Disclosure Code x. Policy on archival of Documents xi. Policy for determination of materiality xii. Corporate Social Responsibility Policy xiii. Risk Management Policy xiv. Dividend Distribution Policy
13. FORMAL ANNUAL EVALUATION
Pursuant to the requirements of Section 134(3)(p) of the Companies Act, 2013 read with Regulation 17 of the listing regulations, the Board has carried out an annual performance evaluation of its own performance, the directors individually as well as the evaluation of its Committees. A structured questionnaire was prepared after taking into consideration inputs received from the Directors, covering various aspects of the Boards functioning such as adequacy of the composition of the Board and its Committees, Board culture, execution and performance of speci c duties, obligations and governance. A separate exercise was carried out to evaluate the performance of individual Directors including the Chairman of the Board, who were evaluated on parameters such as level of engagement and contribution, independence of judgment, safeguarding the interest of the Company and its minority shareholders etc. The performance evaluation of the Independent Directors was carried out by the entire Board. The Directors expressed their satisfaction with the evaluation process.
14. STATEMENT OF DECLARATION BY INDEPENDENT
Pursuant to the requirements of Section 149(7) of the Companies Act, 2013, the company has received the declarations from all the independent directors con rming the fact that they all are meeting the eligibility criteria as stated in Section 149(6) of the Companies Act, 2013.
The Independent Directors have complied with the Code of Conduct for Independent Directors prescribed in Schedule IV of the Companies Act, 2013 and the Code of conduct formulated by the Company as hosted on the Companys Website i.e. www. Mishtann.com.
The Board is satis ed of the integrity, expertise, and experience (including pro ciency in terms of Section 150(1) of the Act and applicable rules thereunder) of all Independent Directors on the Board. Further, in terms of Section 150 read with Rule 6 of the Companies (Appointment and Quali cation of Directors) Rules, 2014, as amended, Independent Directors of the Company have included their names in the data bank of Independent Directors maintained with the Indian Institute of Corporate Affairs.
15. NOMINATION AND REMUNERATION POLICY
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. The salient features of Nomination & Remuneration Policy of the Company is disclosed in the Corporate Governance Report the web address of the Nomination and Remuneration policy is http://www.mishtann.com/uploads/speci cation/nomination-and-remuneration-policy.PDF
16. AUDIT AND AUDITORS
1. Pursuant to the provisions of Section 139(2) of the Companies Act, 2013 and rules made thereunder, M/s. J.M. Patel & Bros., Chartered Accountants, Ahmedabad (Firm Registration No. 107707W) were appointed as Statutory Auditors of the Company for period of 5 years, to hold of ce upto the conclusion of 43rd Annual General Meeting of the
The Auditors Report for the nancial year 31st March, 2023 is unmodi ed, i.e. It does not contain any quali cation, reservation, adverse remark or disclaimer.
The Statutory Auditors have not reported any incident of fraud to the Audit Committee of the Company during the nancial year under review.
IPursuant to the provisions of Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Board of Directors appointed Mr. Kamlesh M. Shah, Practicing Company Secretaries, Ahmedabad to undertake the Secretarial Audit of your Company for the nancial year 2022-2023. The Secretarial Auditor Report u/s 204 of the Companies Act, 2013 in the Format MR-3 is annexed to this Report as “Annexure - B”
There has been no quali cation, reservation, adverse remark or disclaimer given by the Secretarial Auditors in their Report except the following:
Details of compliance/ non-compliance/ late compliance / late submissions for various regulations of SEBI (LODR) 2015 during the year 31/03/2023 and the penal actions if any taken by the stock exchanges against the company and payment of penalty if any made by the company.
Compliance Requirement (Regulations/ circulars / guidelines including speci c clause)
Regulation/ Circular No.
Action Taken by
Type of Action Advisory / Clari cation/ Fine / Show Cause Notice/ Warning, etc.
Details of Violation
Observa tions / Remarks of the Practicing Company Secretary
|1. Notice for Non-
|21(2) of SEBI
|2. Notice for Non-
|23(9) of SEBI
|3. Notice for Non- Regulation
|on of I
|13(1) of SEBI
|4. Notice for Non- Regulation
|13(1) of SEBI
In accordance with the SEBI Circular dated February 8, 2019 read with Regulation 24A of SEBI Listing Regulations, the Company has obtained an Annual Secretarial Compliance Report from M/s. Kamlesh M. Shah, Practising Company Secretaries, con rming compliances with all applicable SEBI Regulations, Circulars and Guidelines for the year ended March 31, 2023
17. INTERNAL AUDIT & CONTROLS policy is
The company has appointed Mr. Gaurang Khatri as an internal auditor for FY 2022-2023, the accounting and other system have been designed in such a manner that review of entire process for safeguarding the assets of the company, its operational ef ciency, and effectiveness of the systems are taken care of properly. Their scope of work includes review of processes for safeguarding the assets of the Company, review of operational ef ciency, effectiveness of systems and processes, and assessing the internal control strengths in all areas. Internal Auditors ndings are discussed with the process owners and suitable corrective actions taken as per the directions of Audit Committee on an ongoing basis to improve ef ciency in operations.
DETAILS IN RESPECT OF ADEQUACY OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THE FINANCIAL STATEMENTS
Your Company has in place adequate internal nancial controls commensurate with its size, scale and operations. Such controls have been assessed during the year under review taking into consideration the essential components of internal controls stated in the Guidance Note on Audit of Internal Financial Controls over Financial Reporting issued by the Institute of Chartered Accountants of India. Based on the results of such assessments carried out by the management, no reportable or signi cant de ciencies, no material weakness in the design or operation of any control was observed. Nonetheless your Company recognizes that any internal control framework, no matter how well designed, has inherent limitations and accordingly, regular audits and review processes ensure that such systems are re-enforced on an ongoing basis. The internal nancial controls with reference to the Financial Statements are commensurate with the size and nature of business of the Company.
18. EXTRACT OF ANNUAL RETURN
The Annual Return for nancial year 2022-23 as per provisions of the Act and Rules thereto, will be available on the Companys website at http://www.mishtann.com/relation.php?category=annual-return
19. BUSINESS RESPONSIBILITY AND SUSTAINABILITY
SEBI, vide its circular dated 10th May, 2021, made Business Responsibility and Sustainability Report (BRSR) mandatory for the top 1,000 listed companies (by market capitalization) from nancial year 2023.
Your Company not being covered under top 1000 companies,
BRSR is not applicable to it.
20. VIGIL MECHANISM:
In pursuant to the provisions of section 177(9) & (10) of the Companies Act, 2013 and Regulation 22 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, a Vigil Mechanism for directors and employees to report genuine concerns has been established. The web link of Vigil Mechanism Policy on the website of the Company is http://www.mishtann.com/relation.php?category=disclosures-and-policies
21. RISK MANAGEMENT
IThe Risk Management Policy as per provisions of the Act and Rules thereto and Regulation 21 of SEBI (Listing Obligations and Disclosure Requirements), Regulations, 2015, will be available on the Companys website at http://www.mishtann.com/uploads/speci cation/RISK%20MANA GEMENT%20POLICY-1.pdf
IThe Risk Management Committee held its meetings on
11.07.2022 and 30.03.2023 in which all members were present.
22. 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
During the Financial Year 2022-2023 there were no Material changes occurred subsequent to the close of the nancial year of the Company to which the balance sheet relates and the date of the report.
23. DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS IMPACTING THE GOING CONCERN STATUS AND COMPANYS OPERATIONS IN FUTURE
During the nancial year under review, no signi cant and material orders were passed by the Indian Regulators or Courts or Tribunals that would impact the going concern status of the Company and its future operations.
24. PUBLIC DEPOSITS
Your Company has not accepted / renewed any deposits from the
public during the Financial Year 2022-2023.
25. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS
UNDER SECTION 186
Particulars of loans given, investments made, guarantees and securities provided under section 186 of the Companies Act, 2013 are provided in the notes of Standalone Financial Statement.
26.PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH
All transactions executed by the Company during the nancial year with related parties were on arms length basis and in ordinary course of business. All such related party transactions were placed before the Audit Committee for approval, wherever applicable. Particulars of the contracts or arrangement with related parties referred into Section 188 (1) of the Companies Act, 2013, in prescribed Form AOC -2 is attached as “Annexure - C”.
The Company has been proactive in the following principles and practices of good corporate governance. A report in line with the requirements of Regulation 27(2) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 the report on Management Discussion and Analysis and the Corporate Governance practices followed by the Company and the Auditors Certi cate on Compliance of mandatory requirements are given as an “Annexure - D” respectively to this report.
Your Company is committed to the tenets of good Corporate Governance and has taken adequate steps to ensure that the requirements of Corporate Governance as laid down in Regulation 27(2) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 are complied with.
As per 27(2) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 with the Stock Exchange, the Corporate Governance Report, Management Discussion and Analysis and the Auditors Certi cate regarding compliance of conditions of Corporate Governance are attached separately and form part of the Annual Report.
28. MANAGEMENT DISCUSSION AND ANALYSIS
The Management Discussion and Analysis as required in terms of
the SEBI Listing Regulations is annexed to the report.
29. OBLIGATION OF COMPANY UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013
Company has only one female Employee, it is beyond the practicality to constitute a local compliance committee but a system has been put in place to protect Female Employee(s) from sexual harassment. During the year Company has not received any complaint of harassment.
30. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION
AND FOREIGN EXCHANGE EARNINGS AND OUTGO
The Particulars regarding Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo, pursuant to Section 134(3)(m) of the Companies Act 2013 read with the Rule 8 of Companies (Account) Rules, 2014 is given in “Annexure - E”.
31. CORPORATE SOCIAL RESPONSIBILITY (CSR)
In compliance with the requirements of Section 135 read with Schedule VII of the Companies Act 2013, the Board has constituted Corporate Social Responsibility Committee.
The Annual Report on CSR activities as required under Companies (Corporate Social Responsibility Policy) Rules, 2014 is set out as “Annexure - F” forming part of this Report.
Brief terms of reference for the CSR Committee include:
1. To formulate a CSR policy which shall indicate activities to be
undertaken by the Company.
2. To recommend the CSR policy to the Board.
3. To recommend the amount of expenditure to be incurred on the
4. To monitor the policy from time to time as per the CSR policy.
The complete policy of Corporate Social Responsibility is displayed on the companys website at i.e. http://www.mishtann.com/uploads/speci cation/Mishtann%20F oods%20Limited- %20Corporate%20Social%20Responsibility%20Policy.pdf
32. DIRECTORS RESPONSIBILITY STATEMENT
The Directors Responsibility Statement referred to in clause (c) of sub-section (3) of Section 134 of the Companies Act, 2013, shall state that
(a) In the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures;
(b) the directors had 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 nancial year and of the pro t and loss of the company for that period;
(c) The directors had taken proper and suf cient care 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) The directors had prepared the annual accounts on a going
concern basis; and
(e) The directors had laid down internal nancial controls to be followed by the company and that such internal nancial controls are adequate and were operating effectively.
(f) The directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively
33.MAINTENANCE OF COST RECORDS
The Central Government has not speci ed for the maintenance of cost records under section 148(1) of the Act for any goods sold or services rendered by the company.
34. LISTING WITH STOCK EXCHANGES
The Company has listed its Equity Shares on BSE Limited and
Metropolitan Stock Exchange of India Limited.
35. SECRETARIAL STANDARDS
The Directors State that applicable Secretarial Standards - 1,2,3 and 4 issued by the Institute of Company secretaries of India relating to Meetings of the Board of Directors and General Meetings,
Payment of Dividend and Report of the Board of Directors
respectively, have been duly followed by the Company.
i. During the year under review, The Central Goods and Services Tax, Commissionerate, Gandhinagar (“Commissionerate”) had initiated investigation against our Company and our Promoter Hiteshkumar Gaurishankar Patel by conducting simultaneous inspection under Section 67(1) of the CGST Act, 2017 at our factory and Registered Of ce. Pursuant to the inspections, it was alleged that the Commissionerate gathered evidence regarding supply of Basmati rice of various quality/grades by our Company without payment of applicable GST by wrongly availing the exemption provided under the Noti cation. No 02/2017 & 28/2017-CT (Rate) dated June 28, 2017 and September 22, 2017.
Pursuant to the above, the Commissionerate arrested our Promoter under Section 132(1)(a) of the CGST Act, 2017 and a criminal complaint was led by Superintendent, Central GST &. Central Excise, Gandhinagar against our Company and our Promoter Hiteshkumar Gaurishankar Patel before the Additional Chief Metropolitan Magistrate, Ahmedabad under Sections 132 and 137 of the CGST Act/ GGST Act, 2017. Our Promoter has been released on bail and the matter is currently pending.
ii. Due to a major outbreak of re at the Registered Of ce of our Company on May 6, 2022, a signi cant portion of the corporate, accounting, nancial, legal and other statutory records, including but not limited to original and digital records of the minutes of the meetings of the Board of Directors, its committees, Shareholders, agreements executed with Directors, related parties, customers, suppliers and other supporting documents and/or RoC lings of our Company post-acquisition until May 2022 were destroyed. While statutory lings including RoC lings, certain minutes of meetings of Board of Directors, its committees, Shareholders, etc., were available in the digital records maintained by the RoC, however internal records such as Form MBP-1, Form DIR-8, signed minutes of meetings of Board of Directors, its committees, Shareholders, agreements, etc., which were not required to be led with the RoC, were destroyed in the re and therefore cannot be retrieved by our Company.
iii. The companys Rights Issue Committee of the Board of Directors, at its meeting held on May 24, 2023 has considered and approved the Draft Letter of Offer dated May 24, 2023 (the “Draft Letter of Offer”) in relation to the rights issue of the Company (the “Issue”) for an amount not exceeding 15,000 Lakhs, with Securities and Exchange Board of India (“SEBI”) and with BSE Limited and Metropolitan Stock Exchange of India Limited (the “Stock Exchanges”). The Draft Letter of Offer has been led with SEBI for issuing of observations thereon and with the Stock Exchanges for seeking their in-principle approval for the proposed Issue and listing of Equity Shares, issued pursuant to the same. However, due to market conditions and strategic considerations, the Board of Directors of the Company, at its meeting held on June 26, 2023 have approved the withdrawal of the DLOF, in consultation with the Lead Managers to the Issue, namely, PNB Investment Services Limited and GYR Capital Advisors Private Limited.
We thank our customers, vendors, dealers, investors, business associates and bankers for their continued support during the year.
We place on record our appreciation of the contribution made by employees at all levels. Our resilience to meet challenges was made possible by their hard work, solidarity, co-operation and support.
|For and on behalf of the Board
|Hiteshkumar Gaurishankar Patel
|Navinchandra Dahyalal Patel