Raj Oil Mills Ltd Directors Report.

To,

The Members,

Raj Oil Mills Limited

Your Directors are pleased to present you the 17th Annual Report on the business and operations of the Company and the audited Financial Statements of Accounts for the year ended March 31, 2019.

As informed to the Members in last AGM, M/s. Rubberwala Housing & Infrastructure Limited and M/s. Mukhi Industries Limited, acquired the Company on May 04, 2018 through the corporate insolvency resolution process (‘CIRP Process) under the Insolvency and Bankruptcy Code, 2016 (‘IBC) (the ‘Acquisition). Post-Acquisition, the Board of Directors of the Company (‘Board) was re-constituted and a new management (‘New Management) was put in place to implement the Resolution Plan as approved by the National Company Law Tribunal, Mumbai Bench, Mumbai (‘NCLT) vide its Order dated Aril 19, 2018 (‘NCLT Order) (‘Approved Resolution Plan or ‘Resolution Plan).

1. FINANCIAL RESULTS

The financial performance of the Company for the Financial Year ended March 31, 2019 is summarized below:

Rupees in Lakh
Particulars Financial Year Ended 31st March, 2019 Financial Year Ended 31st March, 2018
Income From Operations 7139.03 5971.51
Other Income 4.25 5.38
Total Revenue 7143.29 5976.90
(Less): Expenses (12754.12) (9941.07)
Profit Before Depreciation & Tax (5610.85) (3964.17)
(Less): Depreciation (129.13) (212.20)
Profit Before Tax & Exceptional Item (5739.96) (4176.38)
(Less)/Add: Exceptional Item 2258.57 -
Profit/(Loss) before Tax (3481.40) (4176.38)
Add/(Less): Tax Expenses (160.68) (633.48)
Profit/(Loss) After Tax (3320.70) (3542.90)
Other Comprehensive Income 136.54 (9.46)
Total Comprehensive Income
Attributable to Owners of the Company
Attributable to Non – controlling Interest (3184.16) (3552.36)
(3320.70) (3542.90)

Operating revenue was at Rs. 7139.03/- Lakhs in the Financial Year 2018-19 as compared to Rs. 5971.51/- Lakhs in Financial Year 2017-18. The increase in revenue was mainly due to proper utilization of available resources by management of the Company and operational performance by the business. The operating revenue recorded a growth of 19.5% during the FY 2018-19. The Net Loss after tax and depreciation during the FY 2018-19 reduced to Rs. (3320.70)/-lakhs as compared to Rs. (3542.90)/- lakhs during the last financial year

3. FINANCIAL LIQUIDITY

Cash and cash equivalent as at 31st March, 2019 was Rs. 31,73,312/- (previous year Rs. 67,60,606/-).

The Companys working capital management is robust and involves a well-organized process which facilitates continuous monitoring and control over receivables, inventories and other parameters.

4. DIVIDEND

In view of current year loss, your Directors regret their inability to recommend any dividend for the financial year under review.

5. SHARE CAPITAL OF THE COMPANY

During the share capital of the Company is as follows:

The Authorised Share Capital of Company Rs. 160,00,00,000/-.

The paid-up Equity Share Capital of the Company as on 31st March, 2019 is Rs. 14,98,86,840/- divided into 1,49,88,684 shares of Rs. 10/- each.

Out of the above stated paid-up share capital, 39,33,330 equity shares issued pursuant to conversion of warrants are pending to be listed on National Stock Exchange of India Limited and BSE Limited.

Also, the Company issued and allotted 1,12,41,513 equity shares of Rs. 10/- each to the Resolution Applicant pursuant to the order passed by Honble Tribunal on 19th April, 2018, the same is also pending to be listed and traded on both of the aforesaid stock exchanges.

6. RESERVES

In view of current year loss, your Directors regret their inability to carry any amount as reserves for the financial year under review.

7. MATERIAL EVENTS THAT HAVE OCCURRED DURING THE YEAR

As mentioned above the control and management of the Company was taken over by M/s. Rubberwala Housing & Infrastructure Limited and M/s. Mukhi Industries Limited on May 04, 2018, through CIRP process under IBC. Pursuant to the NCLT Order and the Resolution Plan, share capital of the Company was reduced by 95 % on May 16, 2018. Before the reduction of share capital, the paid-up share capital of the Company was Rs. 74,94,34,380/- divided in to 7,49,43,438 equity share of Rs. 10/- each.

Further on May 16, 2018, the Company has allotted 1,12,41,513 shares of Rs. 10/- each to new promoters of the Company as per the Resolution Plan approved by the Honble National Company Law Tribunal.

8. MATERIAL EVENTS THAT HAVE OCCURRED AFTER THE BALANCE SHEET DATE

There are no material changes and commitments, affecting the financial position of the Company which has occurred between the end of the financial year to which the financial statements relate i.e., March 31, 2019 and the date of this Report.

9. BOARD OF DIRECTORS AND KEY MANAGERAIL PERSON

Honble NCLT vide its order dated 19th April, 2018 appointed Mr. Sufyan Abdul Razak Maknojia (DIN: 08003749) as Managing Director of the Company and authorised him to reconstitute the Board of Directors of the Company. In the Board meeting of the Company held on 04th May, 2018, the following appointment / resignations of Directors were approved:

Sr. No. Name Of Director DIN Category
1. Parvez Shafee Ahmed Shaikh 00254202 Chairman & Executive Director
2. Sufyan Abdul Razak Maknojia 08003749 Managing Director & Executive Director
3. Bohman Jamshed Irani 00056882 Non- Executive Independent Director
4. Abdulqadir Shafatali Chaudhary 00339696 Non- Executive Independent Director

CHANGE IN DIRECTORS AFTER END OF YEAR AND UPTO THE DATE OF REPORT

The Board of the Company was further reconstituted by the resolutions passed at the meeting of Board of Directors held on 03rd April, 2019, wherein the following appointment / resignations were approved:

Sr. No. Name of Director DIN Category Appointment/ Resignation
1. Bohman Jamshed Irani 00056882 Independent Director Resignation
2. Tabrez Shafiahmed Shaikh 00255132 Whole Time Director Appointment
3. Atikurraheman Daudbhai Mukhi 05191543 Whole Time Director Appointment
4. Siraj Umar Furniturewala 00177667 Independent Director Appointment
5. Huzefa Dawood Ghadiali 06882025 Independent Director Appointment
6. Lucky Kulkarni 07612040 Independent Director Appointment

CURRENT COMPOSITION OF BOARD OF DIRECTORS

Sr. No. Name Of Director DIN Category
1. Parvez Shafee Ahmed Shaikh 00254202 Chairman & Whole Time Director
2. Sufyan Abdul Razak Maknojia 08003749 Managing Director
3. Tabrez Shafiahmed Shaikh 00255132 Whole Time Director
4. Atikurraheman Daudbhai Mukhi 05191543 Whole Time Director
5. Abdulqadir Shafatali Chaudhary 00339696 Independent Director
6. Huzefa Dawood Ghadiali 06882025 Independent Director
7. Lucky Kulkarni 07612040 Independent Director
8. Siraj Umar Furniturewala 00177667 Independent Director

BOARD MEETINGS:

The Board consisted of 4 (four) members as on March 31, 2019, two of them were Promoters and Whole-time Director, and two of them were Independent Directors.

The Board met Eight (8) times during the Financial Year 2018-19, the dates of the Board Meeting is provided below:

04th May, 2018 11th May, 2018 16th May, 2018 19th June, 2018
13th August, 2018 05th November, 2018 28th November, 2018 14th, February, 2019

Notices of the meeting with the agenda along with necessary details were sent to the Directors on time as per the provisions of Companies Act, 2013 and Secretarial Standards laid down by Institute of Company Secretaries of India (ICSI) in this behalf. The attendance record of the Directors at the Board Meetings held during the Financial Year ended on March 31, 2019 is given here below:

Sr. No. Name Of Director No. of Board Meeting held No. of Board Meeting Attended
1. Parvez Shafee Ahmed Shaikh 8 8
2. Sufyan Abdul Razak Maknojia 8 8
3. Bohman Jamshed Irani 8 4
4. Abdulqadir Shafatali Chaudhary 8 6

10. FAMILIARIZATION PROGRAM FOR INDEPENDENT DIRECTORS

The Directors were introduced to all the Board members and the senior management personnel as Chief Finance Officer, Company Secretary and various Department Heads individually to know their roles in the organization and to understand the information which they may seek from them while performing their duties as a Director. The Company shall conduct Periodical Meetings and make presentation to Familiarized Independent directors with the Strategy, Operations and Functions of the Company.

11. BOARD EVALUATION

Pursuant to the provisions of the Companies Act, 2013 and Regulation 19 of SEBI (Listing Obligations and Disclosures Requirements) Regulations, 2015; the Board is carried out Annual Performance Evaluation of its own performance, the Directors individually as well as the evaluation of the working of its various Committees.

The performance of the Board is evaluated by the Board after seeking inputs from all the Directors on the basis of the criteria such as the Board Composition and Structure, Effectiveness of Board Processes, Information and Functioning, etc. The performance of the committees is evaluated by the Board after seeking inputs from the committee members on the basis of the criteria such as the Composition of Committees, Effectiveness of Committee Meetings, etc.

The Board in consultation with the Nomination and Remuneration Committee review the performance of the Individual Directors on the basis of the criteria such as the contribution of the Individual Director to the Board and Committee Meetings like preparedness on the issues to be discussed, meaningful and constructive contribution and inputs in meetings, etc. In addition, the Chairman is also evaluated on the key aspects of his role. In a separate meeting of Independent Directors, performance of Non-Independent Directors, performance of the Board as a whole and performance of the Chairman is evaluated, taking into account the views of Executive Directors and Non-Executive Directors. The same is discussed in the Board Meeting that followed the Meeting of the Independent Directors, at which the performance of the Board, its Committees and Individual Directors is also discussed. Performance evaluation of Independent Directors is carried out by the entire Board, excluding the Independent Director being evaluated.

12. REMUNERATION POLICY OF DIRECTORS AND SENIOR MANAGEMENT EMPLOYEES

The remuneration policy is directed towards rewarding performance, based on review of achievements. It is aimed at attracting and retaining high caliber talent. The remuneration policy is in consonance with the existing practice in the Industry.

During the year Directors of the Company were not paid any remuneration. There is no separate service contract entered into by the Company with the Directors, the appointment and terms of employment are governed by the Articles of Association of the Company and Resolution passed by the Shareholder of the Company.

13. PARTICULARS OF EMPLOYEE

The details as required under Section 197(12) of the Companies Act, 2013, read with Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel), 2014 is not applicable as there is no employee in the Company employed throughout the financial year with salary above 102 Lakhs per annum or employed in part of the financial year with average salary above 8.5 Lakhs per month.

The ratio of remuneration of each Director to the median employees remuneration and other details in terms of 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 given in the statement here as follows:

Sr. No. Particulars Remarks
1. The Ratio of the remuneration of each Director to the median remuneration of the employees of the Company for the financial year. During the year Directors of the Company are not being paid any remuneration
2. The percentage increase in remuneration of each Director, Chief Financial Officer, Chief Executive Officer, Company Secretary in the financial year. During the year, the Directors of the Company are not being paid any remuneration. The Chief Financial Officer and Company Secretary were appointed during the present Financial Year only thus no comparison can be made from the last years remuneration.
3. The number of permanent employees on the rolls of the company. The total number of permanent employee of Raj Oil Mills Limited as on 31st March, 2019 were 244 (Two Hundred Forty Four)
4. Average percentile increase already made in the salaries of employees other than the managerial personnel in the last financial year and its comparison with the percentile increase in the managerial remuneration and justification thereof and point out if there are any exceptional circumstances for increase in the managerial remuneration. The average % increase in salary was 10% for all employees who went through the compensation review cycle in the year.
5. It is hereby affirmed that the remuneration is as per the Remuneration Policy of the Company. Pursuant to Rule 5(1)(xii) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, it is affirmed that the remuneration paid to the Directors, Key Managerial Personnel and senior Management is as per the remuneration Policy of the Company

14. DECLARATION BY INDEPENDENT DIRECTORS:

The Company has obtained necessary declarations from each Independent Director under Section 149(7) of the Companies Act, 2013, that they meet the criteria of Independence laid down in Section 149(6) of the Companies Act, 2013. The terms and conditions of the Independent Directors are incorporated in the appointment letter of the Directors.

15. DIRECTIOR LIABLE TO RETIREMENT BY ROTATION

In accordance with the provisions of the Companies Act, 2013 (The Act) Mr. Atikurraheman Daudbhai Mukhi (DIN: 05191543), Director of the Company will retire at the ensuing Annual General Meeting (AGM) and being eligible, seeks reappointment. The Board recommends his re-appointment.

16. DETAILS OF KEY MANAGERIAL PERSON:

Sr. No. Name Designation Date of Appointment
1. Parvez Shafee Ahmed Shaikh Chairman & Whole Time Director 04th May, 2018
2. Sufyan Abdul Razak Maknojia Managing Director 04th May, 2018
3. Sanjay Kumar Samantaray Chie Financial Officer 11th, May, 2018
4. Ankit Kumar Jain Company Secretary 05th, Nov. 2018
5. Tabrez Shafiahmed Shaikh Whole Time Director 03rd April, 2019
6. Atikurraheman Daudbhai Mukhi Whole Time Director 03rd April, 2019

The remuneration and other details of the Key Managerial Personnel for FY 2018-19 are provided in Extract of the Annual Return which forms part of this Report.

17. COMMITTEES OF BOARD:

The Company has following committees of Board:

• Audit Committee

• Stakeholders Relationship Committee

• Nomination and Remuneration Committee

A detailed note on the Committees with respect to composition, meeting, powers, and terms of reference is provided under the Corporate Governance Report section in this Report.

18. DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to Section 134(5) of the Companies Act, 2013, the Board of Directors, to the best of their knowledge and ability, confirm:

i. That in the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to departures, if any;

ii. That such accounting policies have been selected and applied consistently and judgments and estimate s have been made 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;

iii. That 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;

iv. That the annual financial statements are prepared on a going concern basis;

v. That proper internal financial controls were in place and that such internal financial controls were adequate and were operating effectively;

vi. That proper system to ensure compliance with the provisions of all applicable laws was in place and was adequate and operating effectively.

Based on the framework of internal financial controls and compliance systems established and maintained by the Company, the work performed by the internal, statutory and secretarial auditors and external consultants, including the audit of internal financial controls over financial reporting by the statutory auditors and the reviews performed by management and the relevant board committees, including the audit committee, the Board is of the opinion that the Companys internal financial controls were adequate and effective during FY 2018-19.

19. INTERNAL FINANCIAL CONTROL

During the year under review, your Company was under the CIRP Process until 19th April, 2018 and a resolution professional was appointed by the NCLT to manage the Companys operations as a going concern. A new management was appointed on May 04, 2018. The new management has on best effort basis and considering the complexity of the operations, including challenges in implementing the Resolution Plan, put in place a framework for Internal Financial Controls. In the judgement of the Board, the said controls seem to be adequate, under the given circumstances.

20. RISK MANAGEMENT

During the year under review, your Company was under the CIRP Process until April 19, 2018 and a resolution professional was appointed by the NCLT to manage the Companys operations as a going concern. A new management was appointed on May 04, 2018. The new management has on best effort basis and considering the complexity of the operations, including challenges in implementing the Resolution Plan, put in place a framework of risk management to identify and mitigate risks to the strategic objectives of the Company.

21. VIGIL MECHANISM AND WHISTLE BLOWER POLICY

The Company has established a vigil mechanism and accordingly framed and adopted a Whistle Blower Policy. The policy enables the employees to report instances of unethical behavior, actual or suspected fraud or violation of Companys Code of Conduct to the management. Further the mechanism adopted by the Company encourages the Whistle Blower to report genuine concerns or grievances and provide for adequate safeguards against victimization of the Whistle Blower who avails of such mechanism and also provides for direct access to the Chairman of the Audit Committee in exceptional cases. The functioning of vigil mechanism is reviewed by the Audit Committee from time to time. No whistle blower has been denied access to the Audit Committee of the Board. The Whistle Blower Policy/ Vigil Mechanism is available on the website of the Company i.e. www.rajoilmillsltd.com

22. SUBSIDIARY, JOINT-VENTURE AND ASSOCIATE COMPANIES:

The Company has no Subsidiaries, Joint Ventures and Associate Company during the year.

23. DEPOSITS

The Company has not accepted any deposits falling under the ambit of Section 73 of the Companies Act, 2013 and the Rules framed thereunder during the year under review.

As per the Resolution approved by the Honble National Company Law Tribunal vide its Order dated 19th April, 2018, the Company is in the process of making the payment of 100% of the principal amount due to fixed deposits holders who has submitted their claims upto an amount not exceeding Rs. 5,36,00,000/- as recorded in the Books of the Company. Till date, the Company has already made a payment of Rs. 53,60,000/- out of the total amount payable to the deposit holders pursuant to the Scheme sanctioned by Honble NCLT, Mumbai Bench.

24. PARTICULARS OF LOANS, GURANTEES AND INVESTMENTS

The particulars of loans, guarantees or investments under Section 186 of the Companies Act, 2013 are provided below:

Sr. No. Name of the recipient Amount (Rs. Crore) Key Terms & Conditions Purpose for which the loan or guarantee or security is proposed to be utilized by the recipient (to be provided only for loan or guarantee or security)
NIL

25. RELATED PARTY DISCLOSURE

All the Related Party Transactions entered into during the financial year were on arms length basis and were in ordinary course of business. The Detail of the related party entered between the Company and the related party are given in the form AOC-2 as Annexure - 1, which is the part of this report, as required under Section 134(3)(h) of the Companies Act, 2013.

26. CORPORATE SOCIAL RESPONSIBILITY (CSR)

Social Welfare Activities has been an integral part of the Company since inception. The Company is committed to fulfill its social responsibility as a good corporate person. Section 135 of the Companies Act, 2013, has laid down the requirement for constitution of Corporate Social Responsibility Committee, which shall be responsible for laying down the CSR Policy, to a certain class or classes of Companies.

The compliance with Section 135 is applicable to specific class or classes of the Companies falling under the threshold mentioned under the Act and rules framed thereunder. However, our Company does not fall under the requisite threshold as mentioned under Section 135 during the financial year under review and thus the compliance with the relevant provision of the Companies Act, 2013 is not applicable.

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

Pursuant to provisions of Section 134 of the Companies Act, 2013 read with Rule 8(3) of the Companies (Accounts) Rules, 2014 the details of Conservation of Energy, Technology Absorption, are not applicable to the Company.

a) CONSERVATION OF ENERGY:

Company makes evaluation on a continuous basis to explore new technologies and techniques to make the operations of crushing and filtration more energy efficient. This includes regular maintenance of machineries and regular check- up of energy consuming devices. Total energy consumption and energy consumption per unit of production is prescribed in Form-A of Annexure – 2 to this report.

b) TECHNOLOGY ABSORPTION AND ADAPTATION:

Your Company has continuously adapted latest technology and best practices from the industry and efforts. Company has made efforts in developing new packaging and new products to make its products duplicate proof and tamper proof, which has yielded good response from the customers and will continue in future.

c) FOREIGN EXCHANGE EARNING AND OUTGO:

The relevant information in respect of the foreign exchanges earnings and outgo for the year ended on 31st March, 2019 are as follows:

Foreign Exchange Earnings - Rs. NIL (Previous Year: Rs. NIL)
Foreign Exchange Outflow – Rs. NIL (Previous Year: Rs. NIL)

28. ORDERS PASSED BY REGULATORS/COURTS/TRIBUNALS

i. The Company had filed an Application under Section 10 of Insolvency and Bankruptcy Code, 2016 with the Honble National Company Law Tribunal Mumbai, Mumbai Bench (The Tribunal) on 23rd June, 2017 which was admitted vide Order dated 10th July, 2017. On 19th April, 2018 the Honble Tribunal passed its Order approving the Resolution Plan submitted by the Successful Resolution Applicant (i.e. Mukhi Industries Limited and Rubberwala Housing & Infrastructure Limited). Pursuant to the said order, the control and management of the Company was taken over by Resolution Applicant and the Company allotted 1,12,41,513 Equity Shares of Rs. 10/- each to Resolution Applicant in terms of the order passed by Honble NCLT. Also, pursuant to the NCLT Order and the Resolution Plan, the share capital of the Company was reduced by 95 % on May 16, 2018. Before the reduction of share capital, the paid-up share capital of the Company was Rs. 74,94,34,380/- divided in to 7,49,43,438 equity share of Rs. 10/- each and post allotment of shares to the Resolution Applicant and post reduction of share capital, the present paid-up share capital of the Company is 14,98,86,840/- divided into 1,49,88,684 shares of Rs. 10/- each.

ii. Sales Tax Department of Maharashtra filed an Appeal [Company Appeal (AT) (Insolvency) No. 309 of 2018] against the Order passed by the Honble National Company Law Tribunal Mumbai, Mumbai Bench dated 19th April, 2018 with National Company Law Appellate Tribunal, New Delhi (Appellate Tribunal) in which Appellate Tribunal passed an Order dated 02nd July, 2016 in which Appellate Tribunal directed to the "Resolution Professional, Corporate Debtor(The Company), the Successful Resolution Applicant and Adjudicating Authority (The Tribunal) to not give effect to the Resolution Plan without prior permission of Appellate Tribunal". Subsequently Honble National Company Law Appellate Tribunal, New Delhi (Appellate Tribunal) vide its Order dated 20th March, 2019 confirmed the Resolution Plan approved the Honble National Company Law Tribunal Mumbai, Mumbai Bench vide its Order dated 19th April, 2018.

iii. During the financial year, National Stock Exchange of India limited and BSE Limited has charged various fines / penalties for non compliance / late submission of compliances by the Company in the past financial years, which has not been paid till date. Further, since there was no claim submitted by the Stock Exchanges with the NCLT at the time of Corporate Resolution Process, the Company has filed a Miscellaneous Application in the Honble National Company Law Tribunal Mumbai, Mumbai Bench for waiver of the penalties / fines and the matter is still sub judice.

iv. Securities Exchange Board of India (SEBI) vide its Order dated November 28, 2018 has imposed a penalty of Rs. 500,000/- (Rupees Five Lakhs) under section 23(A)(a) of Securities Contract Regulation Act. 1956, against which the Company has filed an appeal with the Securities Appellate Tribunal against the Order of SEBI and the matter is still sub judice.

v. The Appellant (Raj Builder), has filed an appeal to the Honble National Company Law Appellate Tribunal in which the Appellant challenged the Resolution Plan Approved by the Honble NCLT Mumbai vide its Order Dated 19th April, 2018. To hand over the premises of the registered office of the Raj Oil Mills Limited Situated at 224-230 Bellasis Road, Mumbai 400008.

In this matter Honble National Company Law Appellate Tribunal passed an Order Dated 08th August, 2018. In which the Honble Appellate Tribunal observed that the Adjudicating Authority is not the competent authority to pass any Order for Eviction.

Further it is observed that it should not be construed to be for finding that the Appellant is the Landlord or the Corporate Debtor is the tenant of the premises which can be decided by the a court of the competent jurisdiction. Appeal stand Disposed

29. AUDITORS

STATUTORY AUDITOR

The Members of the Company at the 16th Annual General Meeting of the Company held on 04th May, 2019 had approved the appointment of M/s. KAILASH CHAND JAIN & Co. Chartered Accountants, Mumbai, (Firm Registration No. 112318W), as the Statutory Auditors for a period of 5 financial years i.e., upto the conclusion of 21st Annual General Meeting of the Company to be held in the year 2023.

INTERNAL AUDITOR

The Board, pursuant to section 138 of the Companies Act, 2013 read with rule 13 of the Companies (Accounts) Rules, 2014, has in its meeting held on 05th November, 2018 appointed M/s K.C. Jain Kala & Co. Chartered Accountants, Mumbai as the Internal Auditor to conduct the Internal Audit of the Company.

30. SECRETARIAL AUDITOR

The Board, pursuant to Section 204 of the Companies Act, 2013 read with Rule 9 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, had appointed M/s Amit R Dadheech & Associates, Company Secretaries (C.P. No. 8952) as the Secretarial Auditors of the Company to conduct the Secretarial Audit as per the provisions of Section 204 of the Companies Act, 2013 for the FY 2018-19. The Secretarial Audit Report for the FY 2018-19 is annexed to this Directors Report as Annexure - 3. The explanations or comments on every qualification, reservation or adverse remark or disclaimer made by the Company Secretary in Practice in the secretarial audit report are self explanatory and not required any further explanations.

31. BOARDS COMMENT ON AUDITORS REPORT

STATUTORY AUDITOR

The statutory Auditor of the Company has qualified its report of the Financial Year 2018-19, the Board of Directors of the Company given explanation or comments on every qualification of the Auditor as follows:

i. A petition has filed against Dipti Veg Oil Limited for recovery of INR 1.75 crore before NCLT, Mumbai and the same is disclosed under the ‘Trade Receivable in the books of accounts of the Company. In this regard no provision has been made in the books of accounts of the Company.

Explanation: The Company has conducted the investigation and System Audit in the above matter and the report of the Auditors States says that the recoverable from the Dipti Veg Oil Limited is certain.

ii. As per section 148 of the Companies Act, 2013 read with rule 3(B)- 20 " Non Regulated Sector – Edible Oil" and the Rule -5 of Companies (Cost Records and Audit) Rule, 2014, the Company is required to maintain the cost record of the manufacturing process. However the Company is in the process of marinating records of cost of materials consumed on actual consumption basis. Further, as per Rule 6 of the Companies (Cost Records and Audit) Rules, 2014 no cost audit has been carried by the Company during the year under Audit.

Explanation: As the Auditor already mentioned in his report that the Company is in the process of maintaining record of cost of the cost of material consumed on actual consumption basis and company has started the maintaining the same. Further with respect to the Audit of the cost Record as per Companies (Cost Records and Audit) Rules, 2014 during the Financial Year Company is not falling under the criteria prescribed in the Act however Company will appoint the Cost Auditor once company will the cross the prescribed Limit.

32. COMPLIANCE WITH SECRETARIAL STANDARD:

The Board of Directors affirms that the Company has complied with the applicable Secretarial Standards issued by the Institute of Companies Secretaries of India (SS1 and SS2) respectively relating to Meetings of the Board and its Committees which have mandatory application.

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

As per the requirement of The Sexual Harassment of Women at Workplace (Prevention, Prohibition & Redressal) Act, 2013 (‘Act) and rules made there under, your Company has adopted a Sexual Harassment Policy for women to ensure healthy working environment without fear of prejudice, gender bias and sexual harassment.

There were no incidences of sexual harassment reported during the year under review, in terms of the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

34. MANAGEMENT DISCUSSION AND ANALYSIS REPORT

Your attention is drawn to the perception and business outlook of your management for your Company for current year and for the industry in which it operates including its position and perceived trends in near future. The Management Discussion and Analysis Report, as required under Regulations 34 of the SEBI (Listing Obligations and Disclosures Requirements) Regulations, 2015 with the Stock Exchange is attached and forms part of this Directors Report.

35. CORPORATE GOVERNANCE:

The Corporate Governance Report for Financial Year 2018 -19 as stipulated under the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 forms part of the Annual Report. The requisite certificate from Statutory Auditor of the Company confirming the condition of corporate governance norms forms part of the Corporate Governance Report.

36. SUSPENSION OF TRADING

As mentioned above pursuant to the Order of NCLT and Resolution Plan, the equity share capital of the Company has reduced by 95 % on May 16, 2018 in respect of which Company has filed a corporate action with the Stock Exchange, pursuant to which the Stock Exchanges have suspended the trading in securities of the Company till the completion of Corporate Action.

37. EXTRACTS OF ANNUAL RETURN:

As required under the provisions of sub-section 3(a) of Section 134 and sub-section (3) of Section 92 of the Companies Act, 2013 read with Rule 12 of the Companies (Management and Administration) Rules 2014, the Extract of Annual Return in Form No. MGT 9 forms part of this report.

38. DISCLOSURE REQUIREMENTS:

As per SEBI Listing Regulations, Corporate Governance Report with Auditors Certificate thereon and Management Discussion and Analysis are attached, which forms part of this report.

39. ACKNOWLEDGEMENTS:

The members of the Board of Directors wish to place on record their sincere appreciation for the devoted services rendered by all the employees and the continued co-operation and confidence of shareholders. The Board expresses their sincere thanks to the Bankers, Government and Semi-Government Authorities, Esteemed Customers, Suppliers, Business Associates and all other well wishers for their consistent contribution at all levels to ensure that the Company continues to grow and excel.

40. CAUTIONARY STATEMENT

The Boards Report and Management Discussion & Analysis may contain certain statements describing the Companys objectives, expectations or forecasts that appear to be forward-looking within the meaning of applicable securities laws and regulations while actual outcomes may differ materially from what is expressed herein.

The Company is not obliged to update any such forward-looking statements. Some important factors that could influence the Companys operations comprise economic developments, pricing and demand and supply conditions in global and domestic markets, changes in government regulations, tax laws, litigation and industrial relations.

For and on behalf of the Board of Director

Sd//- Sd/-
Sufyan Abdul Razak Maknojia Parvez Shafee Ahmed Shaikh
Managing Director Chairman
Mumbai, 04th September, 2019