pact industries ltd Directors report

The Members,

Pact Industries Limited.

Ludhiana.

Your directors feel pleasure in presenting the 28^th Annual Report together with Audited Annual Accounts of Pact Industries Limited for the year ended 31^st March, 2021.

FINANCIAL RESULTS:

The summary of the financial performance of the Company for the financial year ended March 31, 2021 compared to the previous year ended March 31,2020 is given below:

		(in lakh)
Particulars	Financial Year ended 31st March,2021	Financial Year ended 31st March,2020
Revenue from Operations and Other Income (Total Revenues)	4146.88	3678.72
Gross profit before interest and depreciation	115.07	93.62
Finance cost	66.58	55.27
Profit before depreciation and amortization- (Cash Profit)	48.49	38.35
Depreciation and Amortization	18.14	20.51
PBT before exceptional items	30.35	17.84
Exceptional items	0.00	0.00
Profit before Tax (PBT)	30.35	17.84
Provision for Tax- Current	2.03	6.43
Provision for Tax- Deferred	1.74	4.24
Profit after Tax	26.58	15.65
Earnings Per Share (EPS) (in Rs) (after exceptional item )
Basic	0.05	0.02
Diluted	0.05	0.02

1. STATE OF COMPANY’S AFFAIRS:

Total Revenue from Operation for the year is Rs.4142.35 Lakhs as compared to Rs. 3603.53 Lakhs of previous year. The Net Profit for the year ended 31.03.2021 is Rs.26.58 Lakhs as compare to Net Profit of Rs.15.65 Lakhs for the previous year.

2. TRANSFER TO RESERVE:

The company has not transferred profits to the reserves and surplus during the year under review.

3. DIVIDEND:

In order to accumulate funds for future projects, your directors do not recommend any dividend for the year under review.

4. TRANSFER OF UNCLAIMED DIVIDEND TO INVESTOR EDUCTION AND PROTECTION FUND:

Since there were no unpaid/unclaimed Dividend and other amounts, as prescribed under Sections 124 & 125 of Companies Act, 2013 lying with the company, therefore, the provisions of above mentioned sections do not apply to the company.

5. 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:

No Material changes and commitments affecting the financial position of the company have occurred between the end of the financial year and the date on which this report has been signed.

6. CHANGE IN THE NATURE OF BUSINESS:

There was no change in the nature of business of the company during the year under review.

7. SHARE CAPITAL:

During the year No equity shares were allotted to promoters or public.

7.1 BUYBACK OF SECURITIES:

The Company has not bought back any of its securities during the year under review.

7.2 SWEAT EQUITY:

The Company has not issued any Sweat Equity Shares during the year under review.

7.3 BONUS SHARES:

No Bonus Shares were issued during the year under review.

7.4 EMPLOYEES STOCK OPTION PLAN:

The Company has not provided any Stock Option Scheme to the employees.

8. FINANCE:

8.1 CASH AND CASH EQUIVALENT:

Cash and Cash equivalent as at 31^st March, 2021 is Rs. 16.74 Lakh. The Company continues to focus on judicious management of working capital. Working Capital parameters are kept under strict check through continuous monitoring.

8.2 DEPOSITS/ FIXED DEPOSITS:

During the year, Company has not accepted deposit from the public falling within the ambit of Section 73 of Companies Act, 2013 and the Companies (Acceptance of Deposits) Rules, 2014. Further, the Company has not repaid any deposit to public and there are no deposits pending as on 31^st March, 2021.

9.3 PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS:

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

9. BOARD:

The Company recognizes and embraces the importance of a diverse board in its success. We believe that a truly diverse board will leverage differences in thought, perspective, knowledge, skill, regional and industry experience, cultural and geographical background, age, ethnicity, race and gender, which will help us, retain our competitive advantage.

There has been No Change in the Board of Directors of the Company during the Financial Year i.e. 01^st April, 2020 to 31^st March, 2021.

9.1 KEY MANAGERIAL PERSONNEL (KMP):

During the Financial Year 2020-21, Mr. Shiv Pal (Membership No. 45305) was appointed as a Company Secretary cum Compliance Officer of the Company on 27.04.2020 and resigned on 04.06.2020. Thereafter, No Company Secretary and Compliance Officer was appointed by the Company till the close of Financial Year i.e. 31^st March, 2021.

9.2 NO. OF MEETINGS OF THE BOARD:

Eight meetings of the Board of Directors were held during the year. The details of which are as following:

Details of the Meetinq:-

Sr. Date of Meetinq No.

1. 27^th April, 2020

2. 30^th May, 2020

3. 04^th June, 2020

4. 30^th July, 2020

5. 10*¹ September, 2020

6. 12^th November, 2020

7. 30^th November, 2020

8. 09^th February, 2021

The provisions of Companies Act, 2013 and Listing Regulations and SEBI (Listing Obligations and Disclosure) Regulation, 2015 were adhered to while considering the time gap between two meetings.

10. COMMITTEES OF BOARD:

The details regarding Committees of the Board of Directors of the Company are given in the Report on Corporate Governance, which forms a part of this Report.

11. REMUNERATION POLICY AND BOARD EVALUATION:

Company has Nomination and Remuneration policy in place pursuant to Companies Act, 2013 and SEBI (LODR) Regulation, 2015.

Independent directors in their meeting held on 09.02.2021, evaluated the performance of the non independent director of the board including Managing Director. The minutes of the meeting were placed before the board and board affirmed the same. The Board has carried out an annual evaluation of its own performance, performance of its Committees as well as the directors individually.

The details regarding process and criteria for evaluation are given in the Report on Corporate Governance, which forms a part of this Report. The details pertaining to remuneration as required under section 197(12) of the Companies Act, 2013 read with rule 5(1) of the companies (appointment and remuneration of managerial personnel) rules, 2014 is enclosed herewith as Annexure - A

12. DECLARATION BY INDEPENDENT DIRECTORS:

The Company has received necessary declaration from each independent director under Section 149(7) of the Companies Act, 2013, that he/she meets the criteria of independence laid down in Section 149(6) of the Companies Act, 2013 and regulation 16(b) of SEBI (Listing Obligations & Disclosure Requirements) Regulation, 2015.

13. CODE OF CONDUCT COMPLIANCE:

The declaration signed by the Managing Director affirming compliance with the Code of Conduct by Directors and Senior Management, for the financial year ended March 31, 2021 is given in Report on Corporate Governance, which forms a part of this Report.

14. TRAINING OF INDEPENDENT DIRECTORS:

Every new independent director of the Board attends an orientation program. To familiarize the new inductees with the strategy, operations and functions of our Company, the executive directors / senior managerial personnel make presentations to the inductees about the Companys strategy, operations, product, markets, organization structure, finance, human resources, technology, quality, facilities and risk management.

15. DIRECTORS’ RESPONSIBILITY STATEMENT:

In accordance with the provisions of Section 134(5) of the Companies Act, 2013 the Board hereby submit its responsibility Statement:

a) in the preparation of the Annual Accounts for the Financial Year ended 31^st March, 2021 the applicable Accounting Standards have been followed along with proper explanation relating to material departures if any;

b) the directors had selected such accounting policies and applied them consistently and made judgement 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) the directors had taken proper and sufficient 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 financial controls to be followed by the company and that such internal financial 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.

16. AUDITORS:

16.1 STATUTORY AUDITORS:

At the Annual General Meeting M/s Parmod G Gupta & Associates, Chartered Accountants, (Firm Registration No. 018870N) was appointed as a Statutory Auditor of the Company to hold the office commencing from Annual General Meeting for the Financial Year 2020-21 till the conclusion of Annual General Meeting for the Financial Year 2022-23. Accordingly the appointment of M/s Parmod G Gupta & Associates, Chartered Accountants, as statutory auditors of the Company, was approved for a period of three years i.e. till the Annual General Meeting to be held in a Financial Year 2022-2023. They have confirmed their eligibility to the effect that their re-appointment if made would be within the prescribed limits under the Act and that they are not disqualified for re-appointment.

16.2 SECRETARIAL AUDITORS:

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, M/s Bhambri & Associates (C.P No. 22626) was appointed as Secretarial Auditor of the Company for the Financial Year 2020-2021. The Secretarial Audit Report is annexed herewith as ‘Annexure - B’.

The Board of Directors of the Company has appointed M/s Bhambri & Associates, Company Secretaries to undertake the secretarial audit of the company for the Financial Year 2021-2022.

The Secretarial Auditor in his report stated the following observations / qualifications:

1) The Company had no Company Secretary cum Compliance officer for the period from 01.04.2020 till 27.04.2020 and further from 04.06.2020 till 31.03.2021 during the period under review.

Comments / Explanations from Board: Due to Covid-19 the company has been unable to appoint a company secretary for a longer duration.

2) The Company has not paid Listing fee to the stock exchanges (ALF) for the Financial Years 2018-19, 2019-20, 2020-21 and 2021-22.

Comments / Explanations from Board: The Company has not paid Listing fee to MSEI and has raised a dispute and also its intention to delist from MSEI but still the MSEI has been raising additional invoices for Annual Listing Fee. Due to Covid-19 the company is not in a pay such higher listing fee and will file an application for reduction / waiver of listing fee for at least for the period of Covid-19.

3) The scrip of the company has been suspended due to non- payment of ALF dues.

Comments / Explanations from Board: The Company has not paid Listing fee to MSEI and has raised a dispute and also its intention to delist from MSEI but still the MSEI has been raising additional invoices for Annual Listing Fee. This has caused the scrip of the company to be suspended, for which the company shall be filing application for removal of the restriction.

4) The Company has approximately Rs. 2332000 amount pending towards MSME out of which approximately Rs 913000 is disputed on account of quality issues and are pending for more than 45 days.

Comments / Explanations from Board: The dues were as on 31.03.2021 and have subsequently been cleared except for Rs 9,13,000 which are disputed.

16.3 INTERNAL AUDITORS:

Mr. Bipin Bihari Singh performs the duties of internal auditors of the company and their report is reviewed by the audit committee from time to time.

16.4 COST AUDITOR:

The Cost Audit was not applicable on the Company during the Financial Year 2020-21 as per Companies (Cost record & audit) Rules, 2014.

17. INTERNAL FINANCIAL CONTROLS:

The Board has adopted the policies and procedures for ensuring the orderly and efficient conduct of its business, including adherence to the Companys policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information.

18. LISTING OF SECURITIES:

The Securities of the Company are listed on Bombay Stock Exchange Limited and Metropolitan Stock Exchange of India Limited. The Company has not paid Annual Listing Fees for the year Financial Year 2018-19, 2019-20, 2020-21 and 2021-22 and is in violation of SEBI & Exchange Regulations.

19. COMMITTEES OF THE BOARD:

a) Audit Committee: The company had constituted Audit Committee of the Company in compliance with provisions of Section 177 of the Companies Act, 2013 read with Rule 6 of the Companies (Meetings of Board and its Powers) Rules, 2014 and Regulation 18 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 by consisting following Members/Chairman:

Sr. No. Name of Directors	Designation
1. Mr. Sunil rana	Chairman
2. Mrs. Jasjeet Kaur	Member
3. Mr. Harpreet Singh	Member

All the Members of Audit Committee are financially literate and have accounting knowledge to interpret and understand the financial statements. During the year under review, the Audit Committee Members, met Five (5) times on 10.06.2020, 30.07.2020, 10.09.2020, 12.11.2020 and 09.02.2021.

b) Nomination and Remuneration Committee: The company had constituted Nomination and Remuneration Committee of the Company in compliance with provisions of Section 178 of the Companies Act, 2013 read with Rule 6 of the Companies (Meetings of Board and its Powers) Rules, 2014 and Regulation 19 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 by consisting following Members/Chairman:

Sr. No. Name of Directors	Designation
1. Mr. Sunil Rana	Chairman
2. Mrs. Jasjeet Kaur	Member
3. Mr. Eshaan Singh Takkar	Member

The Nomination and Remuneration Committee Members met Two (2) times on 27.04.2020 and 04.06.2020.

c) Stakeholder’s Relationship Committee: The company had constituted Stakeholder Relationship Committee (SRC) of the Company in compliance with provisions of Section 178 of the Companies Act, 2013 read with Rule 6 of the Companies (Meetings of Board and its Powers) Rules, 2014 and Regulation 20 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 by consisting following Members/Chairman:

Sr. No. Name of Directors	Designation
1. Mr. Sunil Rana	Chairman
2. Mr. Harpreet Singh	Member
3. Mrs. Jasjeet Kaur	Member

The complaints received during the year, if any, were duly resolved. The Committee meets as and when required, to deal with the investor related matters. The Stakeholder Relationship Committee Members met two (2) times on 30.07.2020 and 12.11.2020.

d) Risk Management Committee: The Company had constituted Risk

Management Committee in compliance with the provisions of Regulation 21 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 by consisting following Members/Chairman:

Sr. No. Name of Directors	Designation
1. Mr. Eshaan Singh Takkar	Chairman
2. Mr. Jasjeet Kaur	Member
3. Mr. Sunil Rana	Member

No Risk Management Committee meeting was held during the year under review.

20. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS:

There are no significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and Company’s operations in future.

21. ANNUAL RETURN:

The Annual Return of the Company for the Financial Year 2019-2020 (Form MGT-7) can be found on the website of the Company for which the link has been provided as follows:

https://www.pactindustries.in/financial-reoorts/

22. VIGIL MECHANISM / WHISTLE BLOWER POLICY:

The company has set up vigil mechanism viz. Whistle Blower Policy to enable the employees and directors to report genuine concerns, unethical behavior and irregularities, if any, in the company noticed by them which could adversely affect companys operations. The same is reviewed by the Audit Committee from time to time. No concerns or irregularities have been reported till date. The details of the Whistle Blower Policy is explained in the Corporate Governance Report and also posted on the website of the Company.

23. SUBSIDIARIES,JOINT VENTURES AND ASSOCIATE COMPANIES:

The Company does not have any Subsidiary, Joint venture or Associate Company.

24. RELATED PARTY TRANSACTIONS/ PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES:

All transactions entered into with Related Parties as defined under the Companies Act, 2013 and Clause 23 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, during the financial year were in the ordinary course of business and on an arms length pricing basis and do not attract the provisions of Section 188 of the Companies Act, 2013. There were no materially significant transactions with related parties during the financial year which were in conflict with the interest of the Company. Suitable disclosure as required by the Accounting Standards (AS18) has been made in the notes to the Financial Statements. The report of the Board in respect of the particular of contracts or arrangements with related parties referred to sub section (1) of Section 188 in form AOC-2 is annexed to this report in Annexure- C.

25. CORPORATE GOVERNANCE:

Corporate Governance Regulations under SEBI (Listing Obligations and Disclosure Requirements) Regulation, 2015, are not applicable to the Company but still the company has been doing some compliances on voluntary basis.

26. DISCLOSURE UNDER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013:

The Company has in place a prevention of sexual Harassment policy in line with the requirements of the sexual Harassment of Women at the Workplace (prevention, prohibition and Redressal) Act, 2013. During the year 2020-21 no complaints were received by the Company related to sexual Harassment.

27. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO:

The information on conservation of energy, technology absorption and foreign exchange earnings and outgo stipulated under section 134 (3)(m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014, is annexed herewith as "Annexure- D".

28. PARTICULARS OF EMPLOYEES:

The information required pursuant to Section 197 read with Rule, 5 of The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of employees of the Company is as follows:

The Composition of company constitutes One Executive Director (MD) only. No sitting fees have been paid to any director during the Financial Year. The particulars of the employees who are covered by the provisions contained in Rule 5(2) and rule 5(3) of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are:

The remuneration paid to Managing Director is 7,20,000/- per annum.

29. APPRECIATION AND ACKNOWLEDGEMENTS:

The company has been very well supported from all quarters and therefore your directors wish to place on record their sincere appreciation for the support and cooperation received from Employees, Dealers, Suppliers, Central and State Governments, Bankers and others associated with the Company. Your Directors wish to thank the banks, financial institutions, shareholders and business associates for their continued support and cooperation. We look forward to receiving the continued patronage from all quarters to become a better and stronger company.

30. CAUTIONARY STATEMENT:

The statements contained in the Board’s Report and Management Discussion and Analysis contain certain statements relating to the future and therefore are forward looking within the meaning of applicable securities, laws and regulations.

Various factors such as economic conditions, changes in government regulations, tax regime, other statues, market forces and other associated and incidental factors may however lead to variation in actual results.

Date: 25.08.2021	By the Order of the
Board Place: Ludhiana Limited.	For Pact Industries
	Sd/-
	(Managing Director)
	Harpreet Singh DIN: 00570541