Modella Woollens Ltd Directors Report.

To,

The Members,

Your Directors hereby present their 58th Annual Report on the business and operations of the Company together with the audited Statements of the accounts for the year ended on March 31st, 2020.

SUMMARY OF FINANCIAL PERFORMANCE:

Year Ended Year Ended
31-03-2020 31-03-2019
Total Revenue 50,46,808 56,89,099
Less: Expenses 29,09,747 21,95,969
Profit /(Loss) before Depreciation, Amortisation and Tax 21,37,061 34,93,130
Less : Depreciation, Amortisation 1082 1082
Profit Before tax 21,35,979 34,92,048
Less : Current Tax 5,28,540 6,71,870
Less : Short/ Excess Provision of Tax in previous years 74,230 --
Profit/(Loss) After Tax 15,33,209 28,20,178

DIVIDEND:

Your Directors have not recommended any dividend.

DIRECTORS RESPONSIBILITY STATEMENT:

Pursuant to Section 134(5) of the Companies Act, 2013, the Board of Directors, to be best of their knowledge, confirms that –

a) in the preparation of the accounts the applicable accounting standards have been followed along with proper explanations relating to material departure; b) appropriate accounting policies have been selected and applied consistently and have made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for that period; c) 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) the annual accounts have been prepared on a going concern basis; e) they have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively; and 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.

MANAGEMENT DISCUSSION AND ANALSYIS

To avoid duplication of certain information in Directors Report and Management Discussion & Analysis, the Board of Directors of your Company has presented the composite summary of performance and functions of the Company.

INDUSTRY STRUCTURE AND DEVELOPMENT

Your Directors are actively considering various avenues of business.

Economic activity in the financial year 2020-21 is expected to gather pace benefiting from a conductive domestic and global environment.

REGULATIONS

Your Company is complying with various laws and regulations applicable.

PERFORMANCE

Your Company has not earned any business income from its operations during the financial ended 31st March,2020 except other income of Rs.50,46,808/-After adjusting the expenses of Rs.29,10,829/- there is a pre-tax profit of Rs.21,35,979/- as against Rs.34,92,048/- in the previous year.

Your Directors have not transferred any amount to general reserves.

MATERIAL CHANGES AND COMMITMENT

There have been no material change and commitment affecting the financial position of the Company between the end of the financial year to which the financial statements relate and the date of this report.

OPPORTUNITY AND THREATS

Your Directors are actively considering various options and avenues to commence the business. Your Directors do not foresee any threat.

FUTURE OUTLOOK

Though COVID-19 has remarkably dented the economic growth, Indian economy is on a strong growth trajectory. Considering various measures taken by the governments, your Directors feel all these will augur well for the economy in general and your Company in particular.

SUBSIDIARY

The Company does not have any subsidiary company.

CONSOLIDATED FINANCIAL STATEMENT

Since the Company does not have any subsidiary company or associate or joint venture, consolidated financial statements are not prepared.

CORPORATE GOVERNANCE

Provisions of para C, D and E of Schedule V of the SEBI (Listing Obligations and Disclosures Requirements) Regulations, 2015 are not applicable to your Company. Hence, report on Corporate Governance is not annexed.

LOANS, GUARANTEE AND INVESTMENT

The Company has not given any loan or guarantee during the year under review. The Company has made investments in shares, securities and mutual funds as detailed in the financial statement.

PUBLIC DEPOSIT

Your Company has not accepted any deposits from the public, its shareholders or employees during the year under review333

TRANSACTION WITH RELATED PARTIES

In absence of any business activity, the Company did not enter into any material contract/arrangements with related parties, except acceptance/repayment of loans raised from the Directors. Since all such transactions with the related parties entered into by the Company were in ordinary course of business and were on arms length basis, Form AOC-2 is not applicable.

CONSERVATION OF ENERGY, ETC.

Since your Company was not engaged in any manufacturing activity, information as required under the provisions of Section 143(3)(m) of the Act is not furnished. During the year, the Company neither earned nor spent any foreign exchange.

DIRECTORS AND KEY MANAGERIAL PERSONNEL

To comply with the Articles of Association of the Company and the Companies Act, 2013, Mrs. Kalpana P. Shah (DIN: 00368392) shall retire by rotation in the forthcoming Annual General Meeting and being eligible offers himself for re-appointment.

At present, Board of Directors comprises of four Directors Viz. Mr. Sandeep P Shah, Mrs. Kalpana P Shah, Mr. Jenish Patel (Independent) and Mr. Nirav V. Shah (Independent).

Mr. Ganesh Bhoir resigned as Chief Finance Officer with effect from 31st December, 2019. In his place, Ms. Chaitali Viral Shah was appointed as Chief Finance Officer on 10th August, 2020. The Company had the following personnel as the Key Managerial Personnel (KMP) under Section 203 of the Companies Act, 2013 as on 31st March, 2020:

1. Mr. Dhirajprasad G. Vaishnav, Chief Executive Officer 2. Ms. Neelam Chourasia, Company Secretary.

During the year under review, none of the non-executive directors had any pecuniary relationship or transactions with the Company.

DISCLOSURE BY INDEPENDENT DIRECTORS

All the Independent Directors have furnished declarations that they meet the criteria of independence as laid down under Section 149 (6) of the Companies Act, 2013.

AUDIT COMMITTEE

The Committee presently comprises of Mr. Jenish A. Patel, Mr. Nirav V. Shah both Independent Directors, and Mr. Sandeep P. Shah, Director. All the members of the Committee are having financial and accounting knowledge. The Committee met 4 times during the financial year 2019-20.

NOMINATION & REMUNERATION COMMITTEE/POLICY

The Nomination and Remuneration Committee presently comprises of Mr. Jenish A. Patel, Mr. Nirav V. Shah and Mr. Sandeep P. Shah, all non-Executive Directors. The Committee met once during the financial year under review.

The Nomination and Remuneration Policy recommended by the Nomination & Remuneration Committee is duly approved and adopted by the Board of Directors. The said policy is annexed to the report as Annexure 1.

STAKEHOLDER RELATIONSHIP COMMITTEE

The Stakeholders Relationship Committee consists of three members viz. Mr. Sandeep Shah, Mr. Jenish A. Patel and Mr. Nirav V. Shah as its members. The Committee mainly looks into redressal of shareholders and investors grievances with respect to transfer of shares, dematerialization of shares, non-receipt of annual report or declared dividend, etc. The shareholders grievances committee met once during the year. During the year ended 31st March, 2020, the Company did not receive any complaint from any of its members.

BOARD MEETINGS

Five meetings of the Board were held during the year under review. One meeting of the Independent Directors was also held during the year.

BOARD EVALUATION

Pursuant to the provisions of the Companies Act, 2013 the Board of Directors had done the annual evaluation of its own performance, its committees and individual directors. The Nomination and Remuneration Committee reviewed the performance of the individual directors on the basis of criteria such as the contribution of the individual director to the Board and committee meetings.

CSR COMMITTEE

The Company does not fulfill any of the three criteria specified in Section 135(1) of the Companies Act, 2013 and as such is not required to comply with the provisions of Section 135 of the Companies Act, 2013 and Companies (Corporate Social Responsibility Policy) Rules, 2014.

INTERNAL CONTROL SYSTEM

Adequate internal control systems are in place to maintain quality of product, proper accounting as per norms and standards prescribed, asset maintenance and its proper use. The Company has an independent internal auditor, who periodically reviews the accounts and reports to the Audit Committee.

RISK MANAGEMENT

The management continuously access the risk involved in the business and all out efforts are made to mitigate the risk with appropriate action. All the assets of the Company are adequately covered by comprehensive insurance.

EMPLOYEE

Relations between the management and employees were cordial through-out the year.

Information on Particulars of Employees as required under Section 197 of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 forms an integral part of this Report as an Annexure 2.

Information required under Section 197(12) of the Companies Act, 2013 read with Rule 5 (2) and 5(3) of the Companies (Appointment and Remuneration of Management Personnel) Rule, 2014, and forming part of Directors Report for the year ended 31st March, 2020 is given in a separate annexure to this report. None of the employee of the Company was in receipt of a remuneration exceeding Rs.8,50,00/- per month or Rs.1,02,00,000/- per annum. The said annexure is not being sent alongwith this report to the members of the Company in line with the provisions of Section 136 of the Companies Act, 2013. Members, who are interested in obtaining these particulars, may write to the Company Secretary at the Registered Office of the Company. The aforesaid annexure is also available for inspection by the members at the registered office of the Company, 21 days before the 58th annual general meeting and upto the date of the said annual general meeting during normal business hours on working days

AUDITORS

According to Directors, there are no adverse remarks made by Statutory Auditors in their report. Notes to the accounts are self explanatory to comments/observation made by the auditors in their report. Hence, no separate explanation is given.

M/s. Kochar & Associates, Chartered Accountants, Statutory Auditors of your Company, were appointed as Statutory Auditors by the members of the Company in their 56th Annual General Meeting held on 26th September, 2018 for consecutive five years.

INTERNAL AUDITORS

M/s. H.N. Bafna & Co., Chartered Accountants, are the internal auditors of the Company, who plays an important role in strengthening the internal control. The Internal Auditors reports to the Audit Committee.

SECRETARIAL AUDIT

During the year, Secretarial Audit was carried out by Mr. Dhruvalkumar Baladha, proprietor of DDB

& Co., Company Secretaries, Practicing Company Secretary for the financial year 2019-20. The report on the Secretarial Audit is appended as Annexure 2 to this report. According to the Board of Directors the report does not have any adverse remark.

COST AUDIT

Provisions relating to cost audit is not applicable to your Company.

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

No such order was passed by any of the authorities, which impacts the going concern status and companys operations in future.

EXTRACT OF ANNUAL RETURN

Pursuant to the provisions of Section 92(3) and Section 134 (3)(a) of the Companies Act, 2013 a copy of the Annual Return of the Company for the year ended 31st March, 2020 is placed on the website of the Company at www.modellawoolens.com

VIGIL MECHANASIM

The Company has a vigil mechanism policy to deal with instances of fraud and mismanagement. The whistle blower policy is adopted by the Board of Directors and is hosted on the website of the Company.

FRAUD REPORTING

During the year, no fraud whether actual, suspected or alleged was reported to the Board of Directors.

PREVENTION OF SEXUAL HARRASSMENT AT WORKPLACE

In compliance with the Sexual Harassment of Women at Workplace (Prevention, Prohibition & Redressal) Act,2013 your Company has duly constituted an internal complaint committee. The Committee has formulated a policy to ensure protection to its female employees.

CAUTIONARY STATEMENT

Statements in the Annual Report, particularly those which relate to Management Discussion and Analysis may constitute forward looking statements within the meaning of applicable laws and regulations. Although the expectations are based on the reasonable assumption, the actual results might differ.

ACKNOWLEDGEMENT

The Directors wish to place on record their deep sense of appreciation to the Companys Bankers, all the staff members for their unstinted support. Your directors also wish to thank the shareholders for confidence reposed in the management of the Company.

For and on behalf of the Board
Sandeep Shah
Mumbai, Chairman
Date: 09.11.2020 DIN : 00368350