Punjab Chemicals & Crop Protection Ltd Directors Report.


1. Your Directors have pleasure in presenting the 45th Annual Report of the business and operations of the Company along with the Audited Standalone and Consolidated Financial Statements for the financial year ended on March 31, 2021.


The financial performance of the Company for the year ended March 31, 2021 is summarised below:

(Rs. In lakh)



2020-2021 2019-2020 2020-2021 2019-2020
Revenue from Operations and Other Income 68001 56269 67736 56674
Earnings before Interest, Depreciation & Tax & Exceptional item (EBIDTA) 9733 5557 9529 6040
Depreciation/Amortisation 1486 1535 1486 1535
Finance Cost 1346 1814 1232 1794
Profit/(Loss) before Tax & Exceptional item 6901 2208 6811 2711
Exceptional (Expenses)/Income - - - -
Profit/(Loss) before Tax (PBT) 6901 2208 6811 2711
Income Tax Expenses:
Current Tax 1551 1113 1315 1113
Adjustment of tax pertaining to earlier periods - 125 - 125
Deferred Tax 442 (105) 442 (105)
Total Income Tax Expenses 1993 1133 1757 1133
Profit/(Loss) after Tax (PAT) 4908 1075 5054 1578
Other Comprehensive income/(expense) for the year (net of tax) (46) (164) 57 (26)
Total comprehensive income for the year 4862 911 5111 1552
Earnings per share (EPS) 40.03 8.77 41.22 12.87
Basic and diluted (in Rs.)
Reserves (excluding Revaluation reserve) 13227 8549 15151 10224


a) *Consolidated accounts consist of standalone accounts of the Company and of a wholly owned overseas subsidiary Company namely SD AgChem (Europe) NV, Belgium.

3. IND-AS:

As mandated by the Ministry of Corporate Affairs, the financial statements for the year ended on March 31, 2021 has been prepared in accordance with the Indian Accounting Standards (IND AS) as per the Companies (Indian Accounting Standards) Rules, 2015 and the Companies (Indian Accounting Standards) Amendment Rules, 2016 notified under Section 133 of Companies Act, 2013 and other relevant provisions of the Act.

The estimates and judgements relating to the Financial Statements are made on a prudent basis, to reflect in a true and fair manner, including profits and cash flows for the year ended March 31, 2021. The Notes to the Financial Statements adequately explain the standalone and consolidated Audited Statements and form an integral part of this Report.


Your Directors are pleased to state that the year under review ended with the total income of the Company on standalone basis at Rs. 677 crore with a highest ever Profit before Tax (PBT) of Rs. 68.11 crore against the income of Rs. 567 crore and Profit before Tax of Rs. 2711 crore in the previous year.

Your Company is continuously putting efforts to increase margins by increasing sales on high margin products and product mix optimisation. This has resulted in increase of PBT by 151%. As in the past, the maximum sales was from Agro Chemicals Division, Derabassi with net revenue of Rs. 513 crore against Rs. 391 crore of previous year which is 76% of the total revenue. The revenue of Specialty and Other Chemicals Division, Lalru was at Rs. 111 crore against Rs. 127 crore of previous year. Industrial Chemical Division Pune recorded a revenue of Rs. 52 crore against Rs. 37 crore of previous year. The Company is planning to increase market share in Agrochemicals and also plans to manufacture Agrochemicals at the Lalru unit. Process of approval for bifurcating the site to accommodate agrochemicals has been initiated. This will make full use of the available infrastructure there.

The revenue generated includes Job work income of both Derabassi and Lalru divisions of Rs 46 crore against Rs. 29 crore and represent with 7% of the total revenue as compared to 5.30% in the previous year.

The Export of the Company was Rs. 421 crore against Rs. 341 crore of the last year, which is up by 23%. It is a matter of satisfaction that the Company continues to meet the requirement of all the customers as per their satisfaction.


As on 31st March, 2021, the Company has only one wholly owned overseas subsidiary namely SD AgChem (Europe) NV, Belgium. The total income of SD Agchem (Europe) NV was Rs. 11.36 crore with profit before tax of Rs. 0.81 crore as compared to the Income of Rs. 9.14 crore with net profit of Rs. 0.89 crore in the previous year. However, after adjustment of tax of earlier period, there was loss of Rs 1.55 crore.

In compliance with Section 129 of the Act, a statement containing requisite details including financial highlights of the operation of the subsidiary in Form AOC-1 is annexed to the report as Annexure 1.

In accordance with Section 136 of the Companies Act, 2013, the audited financial statements for the year ended 31st March, 2021 include the consolidated financial statements and related information of the Company. The audited statement of accounts of the subsidiary Company alongwith above information are available on the website of the Company i.e. www.punjabchemicals.com.

These documents will also be available for inspection during business hours at the Registered Office of the Company.

The Policy for determining material subsidiaries, adopted by the Board of Directors, pursuant to Regulation 16 of the SEBI (LODR) Regulations, 2015 (hereinafter called as "Listing Regulations") can be accessed on the Companys website at http://www.punjabchemicals.com/wp-content/ uploads/2018/07/Policv-for-determining-Material- Subsidiarv.pdf.


The consolidated financial statements of the Company for the year ended on March 31, 2021 comprises the standalone financial statements of Company and its subsidiary (together referred to as "the Group").

The consolidated revenue of the Company during the year under review was Rs. 680 crore with a profit before tax of Rs. 69 crore against Rs. 563 crore and profit before tax of Rs. 22 crore in the previous year.


It was informed in the last report that the fire broke out in one section of Agro Chemicals Division, Derabassi on 10th July, 2019 and damaged the plant, equipment, capital work-in-progress and inventory. As the plant was fully insured under IAR Policy and Loss of Profit, the Company lodged the claim with the insurance Company for recovery of the losses suffered. The Company has received the major part of the claim against the loss of property. The final claim has been filed with the Insurance Company. The working for claim under LOP has been shared with Insurance Surveyor and is under process. There are no disputes made by the insurance Company against the claim. The Company has recognised, the insurance claim receivables to the extent of aforesaid losses. The plant damaged in the fire has been rebuilt at a different location with improved safety and protection and has been put in operation.

8. COVID-19:

In December, 2019, the COVID-19 pandemic created a world crisis. To control the impact of the pandemic the Government of India declared a nationwide lock-down w.e.f. 24th March, 2020, of all economic activities. This impacted the Economy adversely and the same was evident in the first quarter results. Your Companys - operations are under exempted category being the manufacturer of Agrochemicals and pharma intermediates, so we were allowed to operate. However there was less manpower availability and receipt of raw material was impacted by transport problems, resulting in loss of production. The situation improved after a short time and full operation of all the plants resumed within a month. Your Companys management and employees worked very hard to minimise the impact and ensured that Companys plants were operated safely and requirements of the customers were met. This extraordinary effort minimised the impact on Companys performance. The loss of contribution and margins during that period were mitigated by taking various measures to control the costs and reducing operating and fixed expenses.

The Company has been organising Vaccination camps to provide free doses of vaccine to the employees.

The Company continues to monitor the situation of COVID -19 at all locations and operating in line with the guidelines/instructions issued by the Central/State Government from time to time for health and safety of the employees.


The Board of Directors has decided to retain the entire amount of profits in the profit and loss account and not to transfer any amount to the general reserve.


The Board of Directors are pleased to recommend a dividend of Rs. 2.00 per equity share (20%) for the financial year under review against a dividend of Rs. 1.50 (15%) in the previous year.

The total dividend amount to be paid for the financial year 2020-2021 shall be Rs. 245.24 Lakh.

The dividend on equity shares is subject to the approval of the Shareholders at the ensuing Annual General Meeting of the Company. The dividend once approved by the Shareholders will be payable to those members whose name appear in the Register of members as on the record date.

The Register of Members and Share Transfer Books of the Company will remain closed from Thursday, the 5th August, 2021 to Thursday, the 12th August, 2021 (both days inclusive) and the record date will be Thursday, the 5th August, 2021 for the purpose of payment of dividend for the financial year 20202021.


In terms of Regulation 43A of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (SEBI Listing Regulations), the Board has formulated and adopted the Dividend Distribution Policy on May 27, 2021. The Policy is available on the website of the Company at https://www.punjabchemicals.com/wp-content/ uploads/2021/05/Dividend-Distribution-Policv.pdf.


The paid up Equity Share Capital as at March 31, 2021 stood at Rs. 12.26 crore consisting of 1,22,62,185 equity shares of Rs. 10 each. During the year under review, the Company did not issue any type of shares or convertible securities or shares with differential voting rights. The Company also did not allot /grant any stock options or sweat equity or warrants to the employees. As on March 31, 2021, none of the Directors of the Company was holding any instrument convertible into Equity Shares of the Company.


During the year, the Company has received a Show Cause Notice (SCN) from the Adjudicating Officer of the Securities and Exchange Board of India for alleged non-disclosure of certain information to the Stock Exchanges under Regulation 30 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015. The information pertains to certain alleged liabilities that have/may have devolved on the Companys subsidiaries/erstwhile subsidiaries in relation to certain transactions undertaken in Argentina. Further, the SCN further alleges that the Company and the Whole Time Directors, while determining whether such alleged devolution of debt was material information or not, had not applied the provision of Regulation 30 (4) (i) of the LODR Regulations.

The Company and both the working Directors had settled the matter with SEBI after paying settlement amount. SEBI has accordingly passed settlement orders settling all the charges.


There was no instance of fraud during the year under review, which required the Statutory Auditors to report to the Audit Committee and/or Board under Section 143(12) of Act and Rules framed thereunder.


The State of Affairs of the Company is presented as part of the Management Discussion and Analysis Report in a separate section forming part of this Report, as required under the SEBI (Listing Obligation and Disclosure Requirement) Regulations, 2015.


The business of Performance Chemicals, which include Agro Chemicals, Specialty Chemicals and other chemicals has promising future due to growing demand, introduction of new products and rebalancing of global supply chain. Several global MNCs are looking for reliable partners in India and other South Asian Countries to develop new products and to secure availability. The government of India is encouraging the Industry to partner with these MNCs for industrial development.

As your Company has a long and proven history for manufacturing and exporting various agro and speciality chemicals, - it stands the chance to increase the volume and add new products either under CRAM or for outright sale.

We have started discussions with several companies to increase business in exports and domestic markets. The Company has proven track record and has long experience and relations with many Indian and other MNCs and is working to strengthen this relationship with new products and increased business.

Barring unforeseen circumstances the management has a positive outlook and is confident of growth with wide range of products and new manufacturing techniques.


As stated in the last Annual Report, the Company has availed a working capital facility of Rs. 20 crore and a term loan of Rs. 15 crore for a period of 3 years from RBL bank Limited.

During the year under review a Term Loan (under Asset Finance) of Rs. 50 crore was also availed from SVC Cooperative Bank Limited in the month of January, 2021 for the operations and to meet the additional business needs.

Your Company has received a rating upgrade from CARE Rating Ltd. And it has assigned rating to the bank facilities from RBL Bank Ltd. and SVC Cooperative Bank Limited at CARE BBB (Triple B; Outlook : Stable) from CARE BBB - (Triple B minus; Outlook : Stable) in the last year.

The Company has repaid the Inter Corporate Loan of Rs. 52 crore in the financial year 2020-2021 as per the cash flow availability The Company has also repaid some high cost debts and trying to keep finance cost low. In this endeavour, the Company has availed Bills discounting facilities from few Multinational banks and by taking advance from customers.


The Company does not have any deposit from the public falling within the ambit of Section 73 of the Companies Act, 2013 and The Companies (Acceptance of Deposits) Rules, 2014.


Your Company has taken adequate comprehensive insurance policy for its assets against foreseeable perils like fire, flood, public liability, marine, among others.

The Company has also taken Directors and Officers Liability insurance policy.


The Companys shares continue to be listed at the National Stock Exchange of India Limited (NSE) and BSE Limited (BSE). The Annual Listing fee for the fiscal year 2020-2021 has been paid to these Exchanges.


M/s Alankit Assignments Ltd., Alankit Heights, 4E/2, Jhandewalan Extension, New Delhi - 110055 are the Registrar and Share Transfer Agent of the Company for the Physical as well as Demat shares. The members are requested to contact the Registrar directly for any of their requirements.


a) Independent Directors:

As on 31st March, 2021, the Company has four Independent Directors on its Board, including a Woman Independent Director. Shri Mukesh Dahyabhai Patel (DIN:00009605), Shri Vijay Dilbagh Rai (DIN:00075837), Shri Sheo Prasad Singh (DIN:06493455) and Smt. Aruna Rajendra Bhinge (DIN:07474950), Independent Directors have given the required undertaking for meeting the criteria of independence as laid down in Section 149(7) of the Companies Act, 2013 and Regulation 16(1)(b) of the SEBI (LODR). They have also given declaration for compliance with the Code for Independent Directors prescribed in Schedule IV to the Act.

It may be noted that Shri Vijay Dilbagh Rai (DIN:00075837) will attain the age of 75 years on October 13, 2021. Therefore, Pursuant to Regulation 17 (1A) of the SEBI (LODR) Regulations, 2015 as amended passing of a special resolution is required for continuance of his directorship on the Board of the Company. Therefore, the Company while taking the approval of the Members of his reappointment as Independent Director for the second term, in the Annual General Meeting held on 13th August, 2019 has also taken their approval for the continuation of his Directorship on the Board of the Company as a Non-Executive Independent Director even on attainment of age of 75 years, for the current tenure.

b) Retirement by Rotation:

In terms of Section 152 of the Companies Act, 2013 and the provisions of the Articles of Association of the Company Shri Shivshankar Shripal Tiwari (DIN No. 00019058), Director retires by rotation at the forthcoming Annual General Meeting. He being eligible, has offered himself for reappointment. The Board has recommended his reappointment as a Director, liable to retire by rotation.

c) Whole Time Directors:

Re-appointment of Managing Director and Whole Time Director:

The shareholders of the Company, on December 28, 2020 by means of special resolution passed through Postal Ballot, have given their approval for:

1. Re-appointment of Shri Avtar Singh (DIN: 00063569) as the Whole Time Director of the Company for a period of three (3) years from 14.11.2020 to 13.11.2023 on the terms and conditions including remuneration for the mentioned period.

2. Re-appointment of Shri Shalil Shashikumar Shroff (DIN: 00015621) as the Managing Director of the Company for a period of three (3) years from 15.01.2021 to 14.01.2024 on the terms and conditions including remuneration for the mentioned period.

The remuneration to both the Whole Time Directors has been paid in accordance with the provisions of the Companies Act, 2013.

d) Relationship/Transaction with Company:

The Board has also recommended the payment of commission to all the Non Executive Directors subject to the approval of the members. The resolution for the said approval as required under the Companies Act, 2013 has been proposed in the ensuing Annual General Meeting.

The Directors of the Company had no pecuniary relationship or transactions with the Company except as mentioned in Note no. 44 of the Standalone and Consolidated Financial Statements.

Details and brief resume of the Director seeking reappointment/appointment required by prevailing regulations and rules are furnished in the Notice convening the Annual General Meeting forming part of the Annual Report.

Other details of all the Directors have been given in the Corporate Governance Report attached to this Report.

e) Number of meetings of the Board of Directors

The Board meetings are planned normally in advance in consultation with the Directors. During the Financial Year 2020-2021, the Board met 9 times within the prescribed intervening time gap as provided in the Companies Act, 2013. The details of the Board meetings are given in the Corporate Governance Report that forms part of this Annual Report.

f) Board Evaluation:

In line with the provisions of the Companies Act, 2013 and SEBI Guidance Note on Board evaluation issued on January 5, 2017 read with relevant provisions of the SEBI Listing Regulations, 2015, the Board has carried out an annual evaluation of the Directors individually, of the Chairman and of the Board as a whole. The performance of the Directors was evaluated through a separate meeting of the Independent Directors. The Board evaluated the effectiveness of its functioning, that of the Committees and of individual Directors, after taking feedback from the Directors and committee members.

The performance of the Independent Directors was evaluated by the entire Board except the person who is being evaluated, in their meeting held on May 27, 2021.

A separate meeting of Independent Directors was held on March 24, 2021, to review the performance of Non-Independent Directors, performance of the Board and Committee as a whole and performance of the Chairman of the Company, taking into account the views of Executive Directors and the Non-Executive Directors.

g) Details of Familiarisation Programme:

The details of the programmes for familiarisation of Independent Directors with the Company, their roles, rights, responsibilities in the Company, nature of the industry in which the Company operates, the business model and related matters are posted on the website of the Company at https://www.punjabchemicals. com/wp-content/uploads/2021/04/ Familiarization-Programme-2021.pdf.

h) Committees of the Board:

Pursuant to the requirements under the Companies Act and the Listing Regulations, the Board has constituted the following committees:

a. Audit Committee

b. Stakeholders Relationship Committee

c. Nomination & Remuneration Committee

d. Corporate Social Responsibility (CSR) Committee

e. Risk Assessment Committee

The details of the Committees viz. Composition number of meetings held and attendance of the Committee Members in the meetings are given in the Corporate Governance Report forming part of this Annual Report.

Key Managerial Personnel (‘KMP)

During the year, Shri Vinod Kumar Gupta has been appointed as the CEO of the Company. His brief profile is given in the Corporate Governance Report. The Board of Directors have nominated him as the KMP of the Company also.

Pursuant to the provisions of Section 2(51) and Section 203 of the Companies Act, the Company has the following KMPs :

• Shri Shalil Shashikumar Shroff, Managing Director

• Shri Avtar Singh, Director (Operations & Business Development)

• Shri Vinod Kumar Gupta, Chief Executive Officer (w.e.f. February 8, 2021)

• Dr (HC) Sriram Swaminathan, Chief Financial Officer

• Shri Punit K Abrol, Sr. VP. (Finance) & Company Secretary

• Shri Jain Parkash, Sr. V.P. (Works)


A clean environment and safe operations has always been top priority of the management. Safety of all employees, compliances of environmental regulations and preservation of natural resources are regularly monitored.

The effluent and emissions from the plants are regularly monitored and treated. The Company has an approved Effluent Treatment Plant with incinerator to treat the waste materials in Derabassi and Lalru units. In addition to this, for the solid waste, the Company has tied up with Common Effluent Treatment Plants set up in the nearby area of the manufacturing sites. Derabassi and Lalru units of the Company have been declared as Zero Liquid Discharge (ZLD) facilities.


i) Welfare Activities:

The Company through SDS Memorial Trust has taken up various social works for the betterment of the society.

The Company continues to organise a Blood Donation Camp in the memory of Late Shri S.D. Shroff on 18th December every year. 107 employees donated blood this year.

ii) Corporate Social Responsibility:

Companys Corporate Social Responsibility (CSR) Policy has been posted on the website at http://www.punjabchemicals.com/wp- content/uploads/2019/04/CSR-Policy.pdf in compliance with the disclosure about CSR Policy Rules, 2014.

During the year under review, the Company was required to spend Rs. 45 lakh on CSR activities. The Company has spent Rs. 49.90 lakh which includes Rs. 3.60 lakh which remained unspent in the financial year 2019-2020. The amounts have been spent on upgradation of infrastructure of schools and on public utilities.

The detailed report as per Section 135 of the Companies Act, 2013 read with the Companies (CSR Policy) Rules, 2014 has been attached as Annexure 2.

For other details regarding the CSR Committee, please refer to Corporate Governance Report, which forms part of this Report.


The activities of R&D consists of improvement in the processes of existing products, decrease of effluent load and to develop new products and byproducts.

The Quality Control is the strength of the Company. All raw materials and finished products and material at various stages of processing pass through stringent quality checks for ensuring quality and product meeting stringent specifications.



In terms of Regulation 34 (2) (e) of the Listing Regulations, 2015 read with other applicable provisions, the detailed review of the operations, performance and future outlook of the Company and its business is given in the Managements Discussion and Analysis Report which forms part of this Annual Report and is incorporated herein by reference and forms an integral part of this report.


The Company has complied with the Corporate Governance Code as stipulated under the Listing Regulations. The Report on Corporate Governance in accordance with Rules 34(3) read with para C of Schedule V of SEBI (LODR) Regulations, 2015 forms integral part of this Report.

The requisite certificate from the Practicing Company Secretary confirming compliance with the conditions of corporate governance is attached to the Report on Corporate Governance.


Pursuant to Regulation 34(2)(f) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 "Business Responsibility Report" (BRR) forms part of the Annual Report as Annexure 3.


As per the requirements of Section 92(3) of the Act and Rules framed thereunder, the extract of the Annual Return for FY 2020-21 is uploaded on the website of the Company and the same is available at https://www.punjabchemicals.com/wp-content/ uploads/2021/07/Annual-Return-2020-2021-1.pdf


a. Statutory Auditor Report:

The notes to the financial statements referred in the Auditors Report are self-explanatory. There are no qualifications or reservations or adverse remarks or disclaimers given by the Statutory Auditors of the Company in the Auditors Report and therefore do not call for any comments under Section 134 of the Companies, Act, 2013.

b. Secretarial Audit Report:

The Secretarial Audit Report for the financial year 2020-2021 is annexed to this Report as Annexure 4 and forms part of this Report.

The Secretarial Audit Report does not contain any qualification, reservation or adverse remark.


Particulars relating to loans and guarantees or investments under section 186 of the Companies Act, 2013 are provided at Note no. 47 to the Standalone and Consolidated Financial Statements.


There are no material related party transactions made by the Company with the Promoters, Directors, Key Managerial Personnel or other designated persons which may have a potential conflict with the interest of the Company at large. All related party transactions that were entered into during the financial year were on an arms length basis and were in the ordinary course of business.

A statement giving details of all related party transactions is placed before the Audit Committee and the Board of Directors on a quarterly basis. We have obtained prior omnibus approval of the Audit Committee for transactions which are of repetitive nature. The transactions entered into pursuant to the omnibus and specific approval are reviewed periodically by the Audit Committee.

In compliance with the SEBI (LODR), and related party disclosures under the Accounting Standards, please refer Note 44 of the Standalone and Consolidated Financial statements.

In September 2020, the Board of Directors decided to sell the Companys flat, which was being used as a guest house. The Company sought assistance of professional services of an independent Auction House. On receipt of the bids, the flat was sold to

the highest bidder. However, the highest bid was from a related party. Therefore on receipt of the full bid amount, the flat was transferred. No bidder was offered or received terms and conditions, which were more favourable than the other bidders.

The policy on Related Party Transactions as approved by the Board is uploaded on the Companys website at http://www.punjabchemicals. com/wp-content/uploads/2019/08/Related-Partv- policv.pdf.

In compliance with Section 134(h) of the Companies Act, 2013 and Rule 8(2) of the Companies (Accounts) Rules, 2014, we enclose Form AOC-2 at Annexure 5 of this Report.


The information on conservation of energy, technology absorption and foreign exchange earnings and out go as 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 6 and forms part of this Report.


The Board of Directors and the Management are extremely thankful to all the employees for their commitment, competence and dedication in the affairs of the Company. The relation between the management and employees are transparent, healthy and cordial.

The Welfare Schemes viz. preventive health check up, medical facilities in the factory premises, Cooperative stores, among others, are used extensively by all categories of the employees. The Company organises Sports events for the employees for healthy environment and developing the quality of sportsmanship among them.

The Board of Directors are pleased and place on record its appreciation for all categories of employees for their sincere efforts and the sense of belongingness and commitment towards the Company. Their support and sacrifices during COVID-19 had helped the Company to continue its operations. The management took all required efforts to keep them safe and educated.

The disclosure in terms of the provisions of Section 197(12) of the Act read with Rules 5(1), 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, and the name and details of employees in terms of remuneration drawn and every persons employed throughout the year, who were in receipt of remuneration in terms of Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 and other details of the concerned employees is annexed as Annexure 7 and forms an integral part of this annual report.


Pursuant to Schedule V of SEBI (LODR) Regulation, 2015, the Company has constituted a Risk Assessment Committee. The details of the Committee and its terms of reference are set out in the Corporate Governance Report, forming part of the Boards Report.

The Company has formulated Risk Management Policy which is posted on the website of the Company at www.puniabchemicals.com. The Audit Committee also oversees the area of financial risks and controls.

The Management is fully aware of its responsibility and review various risks viz. Business, Environmental, manpower, financial and take corrective or appropriate actions as and when required for smooth functioning.


The Companys Board is fully balanced with required numbers of Executive and Independent Directors. As on March 31 2021, the Board consists of 8 Members, 2 of whom are Executive Directors, 2 Non Executive Non Independent Directors, 4 Independent Directors. The requirement of reconstitution of the Board is evaluated from time to time. Nomination and Remuneration Committee has formulated a Nomination and Remuneration Policy under Section 178 (3) of the Companies Act, 2013 which lays down criteria for determining qualifications, positive attributes and independence of a Director and remuneration for the Directors, Key Managerial Personnel and senior management level including the appointment of personnel one level below the Key Managerial Personnel.

The same can be viewed on our site http:// www.puniabchemicals.com/wp-content/ uploads/2018/07/Nomination-and-Remuneration- Policy.pdf.


Regulation 22 of the Listing Regulations & Subsection (9 & 10) of Section 177 read with Rule 7 of the Companies (Meetings of Board and its Powers) Rules, 2014, interalia, provides, for all listed companies to establish a vigil mechanism called "Whistle Blower Policy" for Directors and employees to report genuine concerns about unethical behaviour, actual or suspected fraud or violation of the Companys code of conduct or ethics policy.

As a conscious and vigilant organisation, the Company believes in the conduct of the affairs of its constituents in a fair and transparent manner, by adopting the highest standards of professionalism, honesty, integrity and ethical behaviour. In its endeavour to provide its employee a secure and a fearless working environment, the Company has established the "Whistle Blower Policy". The same can be viewed at http://www.punjabchemicals.com/ wp-content/uploads/2018/07/Whistle-Blower- Policy-PCCPL.pdf

The Whistle Blower Policy and establishment of Vigil Mechanism have been appropriately communicated within the Company. The Whistle Blower Policy is also posted on the website of the Company. The purpose of the policy is to create a fearless environment for the Directors and employees to report any instance of unethical behaviour, actual or suspected fraud or violation of the Companys Code of Conduct or Ethics Policy. It protects Directors and employees wishing to raise a concern about serious irregularities within the Company.

During the year, the Company has not received any complaint under Vigil Mechanism/Whistle Blower Policy.


The Company has created and maintaining a secured work environment for the employees. The endeavour of the Company is to give a free and cordial atmosphere without harassment, exploitation and intimidation to all business associates of the Company. To empower women and protect women against sexual harassment, a policy for prevention of sexual harassment is in place and Internal Complaint Committee as per legal guidelines had been set up. This policy allows employees to report sexual harassment instances if any at the workplace to the Committee. The Internal Committee is empowered to look into all complaints of sexual harassment and facilitate free and fair inquiry process with clear time lines. The Policy on Prevention of Sexual Harassment is also posted on the website http://www. puniabchemicals.com/wp-content/uploads/2018/07/ Prevention-of-Sexual-Harrasment.pdf.

During the year ended March 31 2021, no complaints pertaining to sexual harassment was received by the Company.


In terms of the Listing Regulations, the Certificate duly signed by Shri Shalil Shashikumar Shroff, Managing Director, Shri Vinod Kumar Gupta, CEO and Dr (HC) Sriram Swaminathan, Chief Financial Officer (CFO) of the Company was placed before the Board of Directors along with the annual financial statements for the year ended on March 31, 2021, at its meeting held on May 27 2021. The said Certificate is also annexed to the Corporate Governance Report.



M/s. B S R & Co. LLP, Chartered Accountants, Mumbai (Firm Registration No. 101248W/W- 100022), Statutory Auditors of the Company were appointed as Auditors of the Company, for a term of 5 (five) consecutive years, at the Annual General Meeting held on September 14, 2017 on a remuneration mutually agreed upon by the Board of Directors and the Statutory Auditors. Their appointment was subject to ratification by the Members at every subsequent AGM. Pursuant to the amendments made to Section 139 of the Companies Act, 2013 by the Companies (Amendment) Act, 2017 effective from May 7, 2018, the requirement of seeking ratification by the Members for the appointment of the Statutory Auditors every year has been withdrawn from the Statute. Therefore, no resolution seeking ratification by the Members for continuance of their appointment has been proposed at this AGM. The Statutory Auditors have confirmed that they are not disqualified from continuing as Auditors of the Company.


The Board upon recommendation of the Audit Committee has reappointed M/s. P.S. Dua & Associates, Company Secretaries (CP No. 3934), as the Secretarial Auditor to undertake the Secretarial Audit of the Company for the financial year 2021-2022, in terms of Section 204 of the Companies Act, 2013 and Rules there under.


As per the requirements of Section 148 of the Companies Act,2013 (the Act) read with the Companies (Cost Records and Audit) Rules, 2014 as amended from time to time, the Company is required to maintain cost records and accordingly, the same have been maintained.

The Board of Directors upon recommendation of the Audit Committee appointed M/s Khushwinder Kumar & Co. Cost Accountant, Jalandhar (Firm Registration No.100123) as the Cost Auditor of the Company to conduct audit of the cost accounts of all the Divisions of the Company for the financial year 2021-2022. They have submitted a certificate of eligibility for the re-appointment.

In accordance with the provisions of Section 148 of the Act read with the Companies (Audit and Auditors) Rules, 2014, the remuneration payable to the Cost Auditors has to be ratified by the shareholders of the Company. Accordingly, the required resolution for ratification of the remuneration to be paid to the Cost Auditor has been proposed at the ensuing Annual General Meeting.

The Cost Audit Report for the financial year 2019-2020 has been filed and the report for the year under review will be filed before the due date.


Pursuant to the provisions of Section 124 of the Act read with the Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016, as amended (IEPF Rules), all the shares on which dividends remain unpaid/unclaimed for a period of 7 (seven) consecutive years or more has to be transferred to the Demat account of the IEPF Authority as notified by the Ministry of Corporate Affairs. Accordingly, the Company has transferred 1,09,179 Ordinary Shares of the face value of Rs. 10 per share to the Demat account of the IEPF Authority during the financial year 2017-18. During the year 2020-2021, no equity shares or dividend was required to be transferred to IEPF.

The Company had sent individual notice to all the shareholders whose shares were due to be transferred to the IEPF Authority and has also published newspaper, advertisement in this regard. The details of such dividends/shares transferred to IEPF are uploaded on the website of the Company at www.punjabchemicals.com. The members/ claimants whose shares and unclaimed dividend have been transferred to the IEPF Authority can claim the same by making an application to the IEPF Authority in Form IEPF- 5 along with requisite documents (available on www.iepf.gov.in) and sending duly signed physical copy of the same

to the Company along with requisite documents prescribed in Form IEPF-5. Member/claimant can file only one consolidated claim in a financial year as per the IEPF Rules. No claims shall lie against the Company in respect of the dividend/shares so transferred.

Shri Punit K Abrol, Sr. V.P. (Finance) & Company Secretary is appointed as the Nodal Officer of the Company under the provisions of IEPF. The shareholders may send their requests regarding release of equity shares from IEPF Authority at the following email ID: investorhelp@punjabchemicals. com.


The internal financial controls of the Company are constantly assessed and strengthened with proper standard operating procedures (SOP). They are reviewed in routine and required modifications in the SOP are carried out as per the requirement. The controls in the system are commensurate with size, scale and complexities of the business operations. The internal and operational audit have been entrusted to an independent firm of Chartered Accountant M/s. B.M. Varma & Co., Chartered Accountants, Chandigarh. Their assignment includes review of the Internal Financial Controls of various segments of the business and give report to the Audit Committee of any deviation.

The Audit Committee actively reviews the adequacy and effectiveness of the internal control systems and suggests improvements to strengthen the same. The Management Information System of the Company is an integral part of the control mechanism.

The Audit Committee, Board of Directors, Statutory Auditors and the Business Heads are periodically apprised of the internal audit findings and the corrective actions taken.

Audit plays a key role in providing assurance to the Board of Directors. Significant audit observations and corrective actions taken by the management are presented to the Audit Committee of the Board. To maintain its objectivity and independence, the Internal Auditor has an access to the Chairman of the Audit Committee.


No material changes and commitments have occurred between the end of the financial year and the date of the Report which has effect on the Financial Statements.


There are no significant material orders passed by the Regulators or Courts or Tribunals which would impact the on going concern status of the Company and its future operations.


There is no change in the nature of business of the Company


Pursuant to the requirement under sub section 3 (c) of Section 134 of the Companies Act, 2013, with respect to Directors Responsibility Statement, it is hereby confirmed that:

a) in preparation of the annual accounts for the year ended March 31, 2021, the applicable accounting standards have been followed along with proper explanation/disclosure relating to material departures, if any;

b) the Directors have selected such accounting policies, 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 as at March 31, 2021 and of the profit and loss of the Company for the year ended on that date;

c) the Directors 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) the Directors have prepared the annual accounts of the Company on a going concern basis;

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

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


The Directors are pleased to inform that during the year under review, Company has started moving to next level in Information Technology. We have improved few key processes benefiting business, upgraded its Information Technology Infrastructure, Software, Hardware, Networking & Security

In Business Process:-

The Company focused and implemented various modules to upgrade the SAP System. The Company also started generating various MIS related data and statements from SAP.

In Software:-

Software for Thermal & Mask recognition AI base solution integrated with time attendance safeguarding workforce attending factory with alert mechanism and tracking employees temperature installed. Various other steps to monitor movement of the employees during COVID period have also been provided.

In Hardware:-

Our SAP ERP server underwent upgrade and also version update was done for new features and functionality to meet up with future business growing needs. Many users were provided Laptops and other facilities during the period to work remotely during COVID period having continues and smooth business operation. Standardise policy of IT asset across our Company was done.

In Network & Security Domain:-

High uptime was maintained in network along with backup link and also regular security monitoring & update in Anti-Virus, Firewall was done by our Company Secured access to Company information in office and home was facilitated with regular backup of critical servers.


The Company has complied with the applicable Secretarial Standards issued by the Institute of Company Secretaries of India.


The Board of Directors place on record its deep sense of gratitude to the Banks, NBFC, and other Lenders for the timely support to the Company for smooth operations. The Directors also take this opportunity to wholeheartedly thank the shareholders, customers, suppliers, and all other stakeholders for the confidence reposed by them in the Company and its Management

Your Directors wish to place on record their appreciation for the contribution made by the employees at all levels for their hard work, dedication and support.

For and on behalf of the Board of Directors

Place: Baroda CHAIRMAN
Date: May 27 2021 DIN: 00009605