Dear Member,
We have pleasure in presenting the 30th Annual Report of the Company along with the
Audited Financial Statements of Account and Auditors Report thereon for the year ended
March 31, 2016.
COMPANYS PERFORMANCE
The performance of the Company during the year was not satisfactory as the operations
at the plant werestalled due to absence of need base working capital. Your Companys
performance during the financial year 2015-16 is summarized below:
|
|
(Rs In Lakh) |
| PARTICULARS |
Current Year ended on 31-03-2016 |
Previous Year ended on 31-03-2015 |
| Income |
|
|
| Revenue from operations |
12.96 |
194.53 |
| Other Income |
10.14 |
2.32 |
| Total Revenue |
23.10 |
196.85 |
| Expenses |
|
|
| Cost of material consumed |
- |
- |
| Purchase of traded goods |
- |
109.95 |
| Change in inventories of finished goods and work-in-progress |
11.84 |
67.51 |
| Employee benefits expenses |
47.28 |
76.77 |
| Other expenses |
117.88 |
129.56 |
| Prior Period Items and tax |
- |
0.1 |
| Total Expenses |
177.00 |
383.89 |
| (Loss)/profit before depreciation, finance cost and tax |
(153.9) |
(187.04) |
| Finance Cost |
622.53 |
538.07 |
| (Loss)/profit after finance cost but before depreciation and tax |
(776.43) |
(725.11) |
| Deprecation |
364.46 |
277.02 |
| (Loss)/profit after depreciation but before tax |
(1140.89) |
(1002.13) |
| Extraordinary item |
- |
24.07 |
| Exceptional item |
1307.51 |
- |
| Tax expense |
|
|
| a. Current Tax |
- |
- |
| b. Minimum alternate tax entitlement |
- |
- |
| Net (Loss)/ Profit for the year |
(2448.4) |
(978.06) |
DIVIDEND
In the view of Losses suffered by the company, the Directors regret their inability to
recommend dividend for the year under review.
REFERENCE TO BIFR
Since the entire capital of the company is eroded, the company had made a reference to
BIFR for its revival and restructuring and as such BIFR had registered our case as
58/2016.
SHIFTING OF REGISTERED OFFICE FROM THE STATE OF MAHARASHTRA TO THE NCT OF DELHI
The registered office of the company is shifted from the state of Maharashtra to the
NCT of Delhi w.e.f. 30.05.2016
EXTENSION OF ANNUAL GENERAL MEETING
The company had made an application to the registrar of the company to extend the
period of holding AGM and as such the requisite permission was granted to hold the AGM on
or before 31.12.2016.
PRODUCTION & SALES REVIEW
During the year under review, your company had registered Rs 12.96 Lakhs as revenue
from operations as compared to Rs 194.53 Lakh because the operations at the Plant were
stalled and only the existing stock of finished goods were sold off to generate revenue.
During this tenure we have been continuously approaching the Bank with the proposal to
provide the need based working capital on the basis of orders in hand. Your Company also
wrote several letters to the Bank but all in vain as till date we did not get any
appropriate response from them.
We must admit that the Board of Directors have been very supportive during this while
and have continuously made efforts to revive the company. They have been instrumental in
new initiatives and in facilitating new projects in consonance with the objectives of the
company, which could contribute towards increase of revenue from the mainstream business
activities.
BUSINESS STRATEGY
Our strategic objective is to build a sustainable organization that remains relevant to
the agenda of our client while generating profitable growth for our investor. We are
working on forging such alliances that will not only complement our core competencies but
also lead us to growth trajectory. We will periodically assess the effectiveness of our
organization structure and process to optimize it for alignment with our strategic
objectives and agility. We constantly monitor and optimize various operational parameters
such as cost and utilization of resources, distribution of employees, cost of operations
and efficiencies of scale.
PROCUREMENT AND DISTRIBUTION
Procurement department purchases raw cotton and processes into cotton yarn for the
weaving division. Entire yarn production is consumed internally for the manufacturing of
grey fabrics and combed yarn has to be purchased from other spinners.
Marketing department, manages order books, sales and collections.
TECHNOLOGY AND NEW PRODUCT DEVELOPMENT
Managements endeavour is to maximise the quality and quantity of output from the
spinning and weaving department. All efforts are focused on processing higher margin
products with improved efficiency. The focus of the company has been on Exports and
Technical Textiles (including products for institutional sector). Our products are well
accepted in International Market as well as in Defence, Paramilitary forces, Steel and Oil
Companies. RTL is planning to leverage the market for safety and security solutions.
RESOURCES UTILISATION
Fixed Assets: The Fixed assets as at 31st March, 2016 were Rs 6021.18 Lakh.
Current Assets: The current assets as at 31st March, 2016 were Rs 2975.82 Lakh as
against Rs 4338.64 Lakhs in the previous financial year. Inventory level was at Rs 215.09
Lakh as compared to the previous year level of Rs 666.73 Lakh.
OPERATIONS
Manufacturing Capacities: A state of the art manufacturing facility in Jagdishpur,
District Amethi (UP).
Spinning: Current capacity of 11,520 spindles, 12 ring frames, 2 open end and 432
rotors backed by all prepartories from Reiter.
Weaving: There are 72 PU 7100 Sulzer Rueti Shuttle-less Projectile Looms backed by
adequate prepatory. Plant is equipped with Benninger Warping machine and Sucker Muller
high production Sizing Machines.
SUBSIDIARY
As on March 31, 2016, the company has no subsidiary company.
MANAGEMENT DISCUSSION AND ANALYSIS
Management Discussion and Analysis Report for the year under review as stipulated under
SEBI (Listing obligations and requirement) Regulations is presented in a separate section
forming part of the Annual Report.
DEPOSITS
The company did not accept any deposits from the public during the financial year.
Hence, no information is required to be appended to this report.
MEETINGS OF THE BOARD
The Board met four times during the financial year, the details of which are provided
in Corporate Governance Report that forms part of this Annual Report. The intervening gap
between any two meetings was within the time gap prescribed by the Companies Act, 2013 as
well as Regulation 17 of the Listing Regulations.
INDUCTION OF DIRECTOR
On the recommendation of the Nomination and Remuneration Committee, the Members
appointed Mr. Krishan Murari Lal as the Independent Director of the company w.e.f. 28th
September 2015. We thank the shareholders for their support in confirming the appointment
of Mr. Krishan Murari Lal at the AGM of the company held on September 28, 2015. We thank
the shareholders for their support in confirming his appointment.
RETIREMENTS AND RESIGNATIONS
Ms. Pooja Sabharwalwas retired at the Annual General Meeting of the company held on
September 28, 2015 and being eligible, re-appointed as non- executive director.
The term of appointment of Mr. R Shankar as Independent Director ceasedw.e.f. 28th
September, 2015. Mr. Krishan Murari Lal and Mr. Surender Malik had resigned from the
directorship of the Board w.e.f. 13.05.2016 and 01.06.2016 respectively. The board of
directors thanks them for their contribution during the tenure of their directorship.
DECLARATION BY INDEPENDENT DIRECTORS
The Company had also received declarations from all the Independent Directors of the
Company confirming that they meet with the criteria of independence as prescribed both
under sub–section (6) of Section 149 of the Companies Act, 2013 and the regulation 25
of the Listing regulations.
POLICY ON DIRECTORS APPOINTMENT AND REMUNERATION
The Company policy is to have an appropriate mix of executive and independent directors
to maintain the independence of the board and separate its function of governance and
management. The board periodically evaluate the need for change in its composition and
size.
The Policy for selection of Directors and determining Directors independence and
Remuneration Policy for Directors, Key Managerial Personnel and other employees are
attached as Annexure I and Annexure II respectively.
BOARD EVALUATION
Regulation 17 of the listing regulations mandates that the board will monitor and
review the Board evaluation framework. The Companies Act, 2013 states that a formal annual
evaluation needs to be done by the board of its own performance and that of its committees
and individual directors. Schedule IV of the Companies Act, 2013 states that the
performance evaluation of the independent directors will be done by the entire board
except the director being evaluated.
The Company has devised a Policy for performance evaluation of Independent Directors,
Board, Committees and other individual Directors, which includes criteria for performance
evaluation of the non-executive directors and executive directors. On the basis of the
Policy for performance evaluation of Independent Directors, Board, Committees and other
individual Directors, a process of evaluation was followed by the Board for its own
performance and that of its Committees and individual Directors.
FAMILIARATION PROGRAMME FOR INDEPENDENT DIRECTORS
The details of programmes for familiarization of Independent Directors with the
Company, their roles, rights, responsibilities in the Company, nature of the industry in
which the Company operates, business model of the Company and related matters are put up
on the website of the Company at the link:
http://www.runeecha.com//Corporate-Governance.html
COMMITTEE OF THE BOARD
Currently, the board has four committees: the audit committee, nomination and
remuneration committee, stakeholders relationship committee and risk management committee.
A detailed note on the Board and its committee is provided under the Corporate
GovernanceReport that forms part of this Annual Report.
DIRECTORS RESPONSIBILITY STATEMENT UNDER SECTION 134(3) (c) OF THE COMPANIES ACT, 2013
Your Directors confirm that:
1. In the preparation of the annual accounts for the year ended March 31, 2016, the
applicable accounting standards read with requirements set out under Schedule III to the
Act, have been followed and there are no material departures from the same;
2. The Directors have 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 as at March 31, 2016 and of the profit of
the Company for the year ended on that date;
3. The Directors have taken proper and sufficient care for the maintenance of adequate
accounting records in accordance with the provisions of the Act for safeguarding the
assets of the Company and for preventing and detecting fraud and other irregularities;
4. The Directors have prepared the annual accounts on a going concern basis;
5. 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
6. 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.
CORPORATE GOVERNANCE
The Company is committed to maintain the highest standards of corporate governance and
adhere to the corporate governance requirements set out by SEBI. The report on Corporate
Governance as stipulated under the Listing Regulation forms an integral part of this
Report.
CERTIFICATE ON CORPORATE GOVERNANCE
As required by the Listing Regulation, the company could not obtain the certificate on
Corporate Governance due to paucity of funds. However, we undertake to comply with all the
requirements of the Listing regulations as and when the company is acquainted with the
required funds.
PARTICULARS OF EMPLOYEES
There is no such employee in the Company who is drawing remuneration in excess of
limits laid down u/s Section 197(12) of the Companies Act, 2013 read with Rules 5(1) of
the Companies (Appointment and remuneration of Managerial Personnel) Rules, 2014 and
therefore, no such particulars are furnished herewith.
VIGIL MECHANISM
The Vigil Mechanism of the Company, which also incorporates a whistle blower policy in
terms of the Listing Regulation, comprises senior officers of the Company. A whistle
blower through an e-mail, or letter can make protected disclosures to the Compliance
Officer or the Chairman of the Audit Committee.
The Policy on vigil mechanism and whistle blower policy may be accessed on the
Companys website at the link: http:// www.runeecha.com/Corporate-Governance.html
CONTRACTS AND ARRANGEMENTS WITH RELATED PARTIES
All contracts / arrangements / transactions entered by the Company during the financial
year with related parties were in the ordinary course of business and on an arms length
basis. During the year, the Company had not entered into any contract / arrangement /
transaction with related parties which could be considered material in accordance with the
policy of the Company on materiality of related party transactions.
The Policy on materiality of related party transactions and dealing with related party
transactions as approved by the Board may be accessed on the Companys website at the
link: http://www.runeecha.com//Corporate-Governance.html Your Directors draw attention of
the members to Note 34 to the financial statement, which sets out related party
disclosures.
STATUTORY AUDITOR
At the Annual general meeting held on September28, 2015, M/s K. N. Gutgutia& Co.,
Chartered Accountants, were appointed as the Statutory Auditor of the Company for the term
of five years till the conclusion of the 34th AGM to be held in the year 2020 subject to
ratification at every AGM.
COMMENTS ON AUDITORS REPORT
The Auditors Report is self-explanatory and there are no adverse observations /
qualifications contained in the Auditors Report.
SECRETARIAL AUDIT
The Board expresses its inability to get the Secretarial Audit conducted for the
financial year 2015-16 as required under Section 204 of the Companies Act, 2013 and rules
thereunder due to scarcity of funds. However, the board assured to comply with every
statutory requirement once the financial crunch is over.
EXTRACT OF ANNUAL RETURN
In accordance with section 134(3) (a) of the Companies Act, 2013 an extract of Annual
Return of the Company is annexed herewith as Annexure III to this Report.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO
The particulars prescribed under Section 134 (3)(m) of the Companies Act, 2013 read
with the Companies (Accounts) Rules 2014 relating to conservation of energy, technology
absorption, foreign exchange earnings and outgo, are not applicable to the company since
the company had not conducted any manufacturing activities during the period under review.
COST AUDIT
The Textiles Industry was exempted from the provision of the appointment of cost
auditor. However, Ministry vide notification dated 31.12.2014 had amended the Companies
(Cost Records and Audit) Rules, 2014 wherein certain segment of the Textile industry were
included under the preview of the Cost audit which included Cotton Fabric and Cotton
Yarn. Since Cotton Fabrics and Cotton yarn are our main items of manufacturing, then the
provision of the appointment of the Cost Audit becomes applicable to the company w.e.f.
April 01, 2015. During the f.y. 2015-16, the manufacturing activities at the plant were
halted. Therefore, the company expressesits inability to comply with the said requirement.
However, as and when the plant becomes operational, we would take necessary initiative for
the appointment of the cost auditor.
INTERNAL AUDIT
The Board expresses its inability to get the Internal Audit conducted for the financial
year 2015-16.However, the board assured to comply with every statutory requirement once
the financial crunch is over.
GREEN INITIATIVE
The company had started a sustainability initiative with the aim of going green and
minimizing our impact on the environment. Like the previous years, this year too, we are
publishing only the statutory disclosures in the print version of the Annual report.
Additional information is available on our website: www.runeecha.com.
Electronic copies of the Annual Report 2016 and notice of the 30th AGM is send to all
the members whose email addresses are registered with the company/depositary
participant(s). For members who have not registered their email addresses, physical copies
of the Annual report 2016 and notice of 30th AGM are sent in the permitted mode. Members
requiring physical copies may send their request to the Company Secretary.
ACKNOWLEDGEMENT
Your Directors are pleased to place on record their sincere gratitude to the
Government, Financial Institutions, Bankers, customers, vendors and Business Constituents
for their continued and valuable co-operation and support to the Company. They also take
this opportunity to express their deep appreciation for the devoted and sincere services
rendered by the employees at all levels of the operations of the Company during the year.
Your Directors also convey their grateful thanks to the shareholders for their
continued assistance, cooperation and patronage.
|
For and on behalf of the Board of Directors |
| Date: 07.11.2016 |
sd/- |
| Place: Noida |
(Pradeep Jain) |
| CIN: L99999DL1986PLC307282 |
Chairman & Managing Director |
+91-9892691696
