Raj Rayon Industries Ltd Directors Report.


The Members,


Your Directors have pleasure in presenting 28thAnnual Report of the Company together with the Audited Financial Statements of the Company for the year ended 31st March 2021.


Particular For the financial year 2020-21 For the financial year 2019-20
(Amount in Rs. Lakhs.) (Amount in Rs. Lakhs.)
Revenue from Operations Nil Nil
Other Income 95.61 340.61
Total Income 95.61 340.61
Less: Expenses 23.07 121.15
Less: Depreciation & Amortization Expenses 3,550.36 3,610.58
Profit/ (Loss) before tax (3,477.82) (3,391.12)
Tax Expenses
Tax adjustment for earlier years
Profit/ (Loss) after Tax (3,477.82) (3,391.12)


During the financial year under review the Company has earned a total revenue of Rs.95.61 / - lakh as compared to the previous years revenue of Rs.340.61 / - lakh. The Company has incurred a net loss of Rs. (3,477.82) as compared to the previous years Net Loss of Rs. (3,391.12). Your Directors are continuously looking for avenues for future growth of the company.


In absence of profits for the year ended 31st March, 2021 and past accumulated losses, your directors do not recommend payment of any dividend for the year ended 31st March, 2021.


During the financial year under consideration, your Company has not accepted any public deposits within the meaning of section 73 of the Companies Act, 2013 and the rules made there under.


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

The Companys Internal Audit department evaluates the efficiency and adequacy of internal control system and gives its report and recommendations to the Chairman of Audit Committee and based on Internal Audit Report the corrective actions are taken.


The Board at present consists of 4 Directors. The Board of Directors is duly constituted.

During the year, Four Board Meetings held. The dates of Board Meetings along with attendance of each Director are given below:

Sr. No Date of Board Meeting Name of Director and Attendance details
RajkumariKano dia BantiParasar RajendraprasadR ampratap Sharma MayadharRav indarMahaku d
1. 29/06/2020 Present Present Present Present
2. 15/09/2020 Present Present Present Present
3. 09/11/2020 Present Present Present Present
4. 13/02/2021 Present Present Present Present

As the Company is under Corporate Insolvency Resolution Process Mr.AbhishekNagori as the Resolution Professional ("RP") was a Chairman for all the Board meetings and Committee meetings.

Details of all the Committee along with their composition and meetings held during the year under review are given in the Corporate Governance Report. The intervening gap between the companies was within the period prescribed under the Companies Act, 2013.

All Independent Directors have given declarations that they meet the criteria of independence as laid down in Section 149(6) of the Companies Act, 2013 and Regulation 16 (b) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.Separate meetings of Independent Directors, pursuant to Section 149 (7) read with Schedule VI of the Companies Act, 2013 was held on 13thFebruary, 2021.

There was no change in the composition of Director during the review period.


The Directors Responsibility Statement referred to in clause (c) of sub-section (3) of Section 134 of the Companies Act, 2013, shall state that—

(a) in the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures;

(b) the directors had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the company at the end of the 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.


M/s. Chaturvedi& Patel Chartered Accountant Firm registration no.: 121351W, had expressed their inability to continue as the Statutory Auditors of the Company, as their term of peer review is expired.

Pursuant to the provisions of section 139 and all other applicable provisions, if any of the Companies Act, 2013, and the rules framed thereunder, as amended from time to time, M/s. MKPS & Associates, Chartered Accountants (Firm Registration No. 302014E)are to be appointed for the period of 5 years at the ensuing Annual General Meeting. Accordingly, the appointment of M/s. MKPS & Associates, Chartered Accountants (Firm Registration No. 302014E), as the Statutory Auditors of the Company to hold office from the conclusion of ensuing Annual General Meeting until the conclusion of the FY 2025-2026 of the Company.

The Notes on financial statements referred to in the Auditors Report are self-explanatory and do not call for any further comments. The Auditors Report does not contain any qualification, reservation or adverse remark.

The Auditors Report contains qualification, reservation.

As the company is under Corporate Insolvency Resolution Process the Mr. AbhishekNagori as the Interim Resolution Professional ("IRP") in term of the Insolvency and Bankruptcy Code, 2016 ("Code") to manage the affairs of the Company as per the provisions of the Code.


There was no instance of fraud reported by the auditor in their report under Section 143 (12) of the Companies Act, 2013.


The provisions of Section 204 of the Companies Act, 2013 read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed Ms. Riddhi Shah a Company Secretary in Practice to undertake the Secretarial Audit of the Company for the Financial Year 2020-21. The Secretarial Audit Report (MR-3) is annexed herewith as Annexure - A.


Pursuant to the provisions of Section 178 of the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Board has carried out annual performance evaluation of its own performance, the directors individually as well as evaluation of working of committees of Board of Directors.

Executive Directors were evaluated on the basis of targets / criteria given to them by the board from time to time as well as per their terms of appointment. Independent Directors, being evaluated by entire board except of Director being evaluated ,on meeting their obligations connected with their independence criteria as well as adherence with the requirements of professional conduct, roles, functions and duties specifically applicable to Independent Directors as contained in Schedule IV of the Companies Act, 2013. Chairman and other Non Independent Directors were being evaluated by Independent Directors, who also reviewed the performance of secretarial department. Performance evaluation of the Committees and that of its members in effectively discharging their duties, were also being carried out by board.

The overall performance of Chairman, Executive Directors and Non-Executive Directors of the Company is satisfactory. The review of performance was based on criteria of performance, knowledge, analysis, quality of decision making etc.


Management Discussion and Analysis Report for the year under review, which also deals with the opportunities, challenges and the future outlook for the Company, as stipulated under Regulation 34 of the SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015 Agreement with the Stock Exchange of India, is presented in a separate section forming part of the Annual Report.


The detailed key features of the CDR Proposal are given in under Notes forming part of Notes to Accounts given in this Annual Report.


The State Bank of India has filed the petition with NCLT Ahmedabad under section 7 of the Insolvency and Bankruptcy Code the same was admitted and the Corporate Insolvency Resolution Process ("CIRP") application filed against Raj Rayon Industries Limited and appointed Mr. Abhishek Nagorias the Resolution Professional ("RP") in term of the Insolvency and Bankruptcy Code, 2016 ("Code") to manage the affairs of the Company as per the provisions of the Code.

However, the power of the Board were suspended with effect from 23/01/2020. The NCLT order also provided for a moratorium with effect from 23rd January 2020 till the completion of the Corporate Insolvency Resolution process (CIRP) or until it approves the resolution plan under section 1(1) or passes an order for liquidation of the company under section 33, whichever is earlier. Currently, the CIRP process in respect of the company is in progress. Resolution Plan passed by CoC and filed application to the Honble National Company Law Tribunal (NCLT) for approval of Resolution plan. Approval of the Resolution plan is pending.


Your Company does not have any subsidiary company or joint ventures Companies, and associate Company.


The Company is committed to maintain the highest standards of Corporate Governance and adheres to the Corporate Governance requirements as stipulated by SEBI. The report on Corporate Governance as prescribed in Regulation 34 (3) read with Schedule V of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 forms an integral part of this Annual Report. The requisite certificate from the Auditors of the Company confirming compliance with the conditions of Corporate Governance along with a declaration signed by the Chairman and Managing Director stating that Members of the Board and Senior Management Personnel have affirmed the compliance vide Code of Conduct of the Board and Senior Management is attached to the report on Corporate Governance.

As per Regulation 34 (3) read with Schedule V of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, a separate section on corporate governance practices followed by the Company, together with a certificate from the Companys Auditors confirming compliance forms an integral part of this Report.


The Company not appointing the Cost Auditor to conduct the Cost Audit for the financial year 2020-2021, as per Section 148 of Companies Act, 2013 due to non- production year.


The Board of directors was decided that since the company is not in a position to meet the remuneration of internal auditors due to huge losses, the company has postponed the appointment of the internal auditors.


Pursuant to Section 134 (3) (a) of the Companies Act, 2013 an extract of the Annual Return in Form No. MGT - 9s annexed herewith as Annexure B.

Conservation of energy, technology absorption and foreign exchange earnings and outgo

The details of conservation of energy, technology absorption, foreign exchange earnings and outgo are as follows

A) Conservation of energy:

Use of LED LIGHTS for saving electrical consumption

We have taken a forward steps towards the conservation of energy in terms of electrical power saving by using the LED LIGHTS. In this year we have replaced the plant lighting bulbs by the energy saving LED LIGHTS. Step by step we will try to replace the whole lighting bulbs by these LED.

Less use of Pta charging electrical host for saving electrical consumption.

Pta is the key raw material for CP plant. Now we brings the Pta in tankers to our plantwhich save the electrical energy consume during the PTA bag lifting up & down movement of electrical hoist.

Demand Based Use of Cooling tower Fan & Air Cooler Fan.

Due to the day & night atmosphere tempdifference. In day we require the 2 fans of both type of cooler to be run. In night we stopped the one electrical fan of both cooler.

Demand Based Reduction of load on chiller & cooling tower.

By optimizing the plant process parameter & process activity we reduce the load on cooling tower & chiller.

Use ofturbo vent in place of electrical operated exhaust fan

B) Technology absorption

Installed HT Capacitor Bank for increasing power factor

We have taken our steps towards the modern days technology absorption by installing the H.T. Power capacitor bank which will increase the power factor so thus it will be save the power consumption directly

Installing direct polymer melt (DPM) to poy

We have installed the direct melt line to poy which will save the energy consumption along with convenient source for supplying the polymer to poy.

Installing new POY plant

We have installed the new poy plant which will decrease the power consumption ratio of per ton of production. New poy plant all machinery equipment efficiency is higher as compared to the old one .

Saving of power cost (Power Purchase from IEX)

We have taken a forward steps by purchase power from (Shot Term Open Access) Power Exchange & its per unit power rate is too less compared to the DNHPCL power rate.

(C) Foreign exchange earnings and Outgo:

The particulars regarding foreign exchange earnings and outgo are given in Note No. 36 to 40 of Financial statement.


The Company has constituted a Corporate Social Responsibility (CSR) Committee as per provisions of Section 135 of Companies Act, 2013 to spend in various CSR initiatives as provided under schedule VII of the Companies Act, 2013 and rules made thereunder.

However due to losses suffered and your company been into Corporate Debt Restructuring (CDR), the company has not spent on any CSR activities/projects. However, your Company is enthusiastic to serve the society at large, which it will do in the coming years.


The Equity Shares of the Company are listed on the BSE Limited & NSE Limited. Shareholders are requested to convert their holdings to dematerialized form to derive its benefits by availing the demat facility provided by NSDL and CDSL.


The Company has received necessary declarations from each Independent Director under Section 149(7) of the Companies Act, 2013, that he/ she meets the criteria for Independence as laid down in Section 149(6) of the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2016.


The Current policy is to have an appropriate proportion of executive and independent directors to maintain the independence of the Board, and separate its functions of governance and management. On March 31, 2019, the Board consists of fourmembers CFO and three are independent directors. The Company has framed a Nomination, Remuneration and one Nominee Director and Evaluation Policy.


Pursuant to the requirement of the Companies Act 2013 and provisions of Listing Agreement applicable to the Company, your Company has adopted Vigil mechanism (Whistle Blower Policy) for complying with the Companys Code of Conduct and Ethics, and particularly to assuring that business is conducted with integrity and that the Companys financial information is accurate. The reportable matters may be disclosed by the employees to the Management / Managing Director / Chairman of the Audit Committee. No complaint was received during the Financial Year 2020-21. During the year under review, no employee was denied access to the Audit Committee.


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


All the related party transactions which were entered by the Company during the financial year were done on arms length basis and were in the ordinary course of business of the Company. Also there are no materially significant related party transactions made by the company with Directors, Key Managerial Personnel, Promoter or any other designated persons which may conflict with the interest of the Company at large.


Due to losses the Company has not paid any remuneration to the Board of directors. Pursuant to that disclosures pertaining to remuneration and other details as required under Section 197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are not provided in the Annual Report as AnnexureC.

In terms of the provisions of Section 197(12) of the Act read with Rules 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, a statement showing the names and other particulars of the employees drawing remuneration in excess of the limits set out in the said rules are required to be provided in the Annual Report. However there were no employees who were in receipt of remuneration for which details need to be disclosed.


Although the company has long been following the principle of risk minimization as is the norm in every industry, it has now become a compulsion.

Therefore, in accordance with Regulation 21 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 the Board members were informed about risk assessment and minimization procedures after which the Board formally adopted steps for framing, implementing and monitoring the risk management plan for the company.

The main objective of this policy is to ensure sustainable business growth with stability and to promote a pro-active approach in reporting, evaluating and resolving risks associated with the business. In order to achieve the key objective, the policy establishes a structured and disciplined approach to Risk Management, in order to guide decisions on risk related issues. In todays challenging and competitive environment, strategies for mitigating inherent risks in accomplishing the growth plans of the Company are imperative. The common risks inter alia are: Regulations, Competition, Business risk, Technology obsolescence, Investments, Retention of talent and Expansion of facilities.

Risk Management framework shall primarily focus on the elements such as Risk to Company Assets and Property, Employees Related Risks, Foreign Currency Risks, Risks associated with Non-Compliance of Statutory enactments, Competition Risks, Operational Risks and various other types of risks which may affect the business or organization. Business risk, inter-alia, further includes financial risk, Political risk, Fidelity risk, Legal risk. As a matter of policy, these risks are assessed and steps as appropriate are taken to mitigate the same.

Pursuant the provision of Regulation 21 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 with respect to the formation of the Risk Management Committee is not applicable to your Company. Detailed policy framework is disclosed on the website of the Company at http://www.rairavon.com/Pdf/risk-management-policv.pdf


Your Company would like to bring to the notice of the shareholders that,the unpaid dividend which needs to be transferred to Investor Education & Protection Fund as per Section 125 of the Companies Act, 2013 was not done and the balance is in Banksunpaid dividend Account.


a) The Company has not issued any bonus shares, sweat equity shares, shares with differential voting rights and equity shares on rights basis during the year under review.

b) The Company does not accept any deposit from its public.

c) It is not proposed to transfer any amount to reserves.

d) No material changes and commitments which could affect the Companys financial position have occurred between the end of the financial year of the Company and date of this report.

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

f) The provisions regarding receipt of remuneration or commission from holding or subsidiary of the Company are not applicable and hence, the disclosure under Section 197 (14) is not required.

g) The Company has not received any complaints under Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

h) No significant and material orders were passed by the regulators or courts or tribunals impacting the going concern status and Companys operations in future.

i) The Company has complied with the Secretarial Standards issued by The Institute of Company Secretaries of India on Meetings of the Board of Directors and General Meetings.

Voting rights which are not directly exercised by the employees in respect of shares for the subscription/purchase of which loan was given by the Company (as there is no scheme pursuant to which such persons can beneficially hold shares as envisaged under section 67(3)(c) of the Companies Act, 2013).


Your Directors would like to express their grateful appreciation for assistance and co-operation received from the Banks, Government Authorities, Customers, Vendors and Members during the year under review. Your Directors also wish to place on record their deep sense of appreciation for the committed services of the Executives, Staff members and Workers of the Company.