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Your Directors have pleasure in presenting the Twenty Ninth Annual Report together with the Audited Accounts of the Company for the year ended 31st March, 2018.
The Statement of Accounts have been prepared in accordance with Indian Accounting Standards (IND AS) which have been made applicable to the Company w.e.f. 1st April, 2017 as per the Rules laid down in this regard. Accordingly, accounts of the Company have been restated w.e.f. 1st April, 2016 (being comparative year for the current financial year) as per the IND AS requirements.
1. REVIEW OF PERFORMANCE:
(Amount in Rs.)
|Particulars||Current Year 31.03.2018||Previous Year 31.03.2017|
|Revenue from Operations||10,16,899||71,72,965|
|Net Profit/(Loss) Before Exceptional Items and Tax||(76,72,482)||(1,37,17,967)|
|Less: Exceptional Items|||||
|Less: Provision for tax including Deferred Tax|||||
|Net Profit/(Loss) after tax||(76,72,482)||(1,37,17,967)|
2. OPERATIONAL REVIEW:
During the financial year 2017-18, your Company recorded Turnover of Rs. 10.17 Lakhs compared to Turnover of Rs. 71.72 Lakhs and incurred a Net Loss after tax of Rs. 76.72 Lakhs as against Net Loss after tax of Rs. 137.18 Lakhs during the previous financial year. Since July, 2015 Company has stopped production due to unviable market conditions and acute financial position of the Company.
Your Company has been inoperative during the financial year under review. The Revenue from operations represents amounts realized on sale of Stock in hand. Your Board of Directors are looking various prospects to revive the company.
As there are no operations in the Company, your directors do not recommend any dividends for the financial year2017-18.
Your Company has not accepted any deposits falling under Section 73 of the Companies Act, 2013and Companies (Acceptance of Deposits) Rules, 2014, during the year.
5. SUBSIDIARY/ASSOCIATE COMPANIES:
Your Company did not have any subsidiary or Associate Company for the financial year ended on 31 st March, 2018.
In accordance with the provisions of Section 136 of the Companies Act 2013, the audited financial statements and related information of the Company are available on our website. The said information is also available for inspection at the Registered Office of the company during working hours and any member interested in obtaining such information may write to the company and the same will be furnished without any fee and free of cost.
6. PARTICULARS OF EMPLOYEES:
There are no employees whose particulars are to be furnished pursuant to Section 197(12) of the Companies Act, 2013 read with Rule 5 of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 as the remuneration of none of the employees has crossed the limits specified therein.
Disclosures pertaining to remuneration and other details, in compliance with the Remuneration Policy of the Company as required under Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are provided in Form MGT-9 forming part of the Annual Report.
7. DIRECTORS RESPONSIBILITY STATEMENT:
Pursuant to Section 134(5) of the Companies Act, 2013 the Directors of your Company hereby confirm that:
a) In the preparation of Annual Accounts for the year ended 31st March, 2018, the applicable accounting standards have been followed along with the proper explanation relating to material departures, if any, there from;
b) 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 true and fair view of the state of affairs of the Company at the end of the financial year ended 31 st March, 2018 and of the profit and loss of the Company for that period;
c) The Directors have 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 frauds and other irregularities;
d) The Directors have prepared the annual accounts on a going concern basis.
e) The directors had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and operating effectively; and
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.
8. BOARD MEETINGS, BOARD OF DIRECTORS, KEY MANAGERIAL PERSONNEL & COMMITTEES OF DIRECTORS:
i) Board Meetings:
The Board of Directors of the Company met Six times during the year 2017-18. The gap intervening between two meetings of the board is as prescribed in the Companies Act, 2013. The detail of number of meetings attended by each director is as follows:
|S. NO.||Names of Directors||
|1.||Sava Reddy Chemolla||Yes||Yes||Yes||Yes||No||Yes|
|2.||Ranga Reddy Mettu||No||No||No||No||No||No|
|4.||Srinivas Reddy Annapureddy||Yes||Yes||Yes||Yes||Yes||Yes|
|5.||Prabhu Reddy Kandula||Yes||Yes||Yes||Yes||No||Yes|
ii) Changes in Directors & Key Managerial Personnel:
During the year, Mr. Veera Venkata Satyanarayana Katta resigned from the position of Chief Financial Officer (CFO) of the Company and Mr. Chandra Shekar Reddy Tirumalareddy was appointed as Chief Financial Officer (CFO) of the Company w.e.f. 30.05.2017.
iii) Significant events after close of financial year:
Mr. Ranga Reddy Mettu, Independent director of the Company has resigned from the directorship of the Compoany w.e.f 16.08.2018. The Board puts on records appreciation for services rendered by him during his tenure as independent director of the company.
Mr. ASrinivas Reddy, Director of the Company retire by rotation at the ensuing Annual General Meeting and being eligible, offer himself for re-appointment.
v) Independent Directors:
The following Independent Directors who were appointed for a period of Five (5) years, continue to be on the Board:
1. Mr. Saya Reddy Chennolla w.e.f29.09.2014
2. Mr. Ranga Reddy Mettu w.e.f 29.09.2014 (upto 16.08.2018)
3. Mr. Prabhu Reddy Kandula w.e.f 28.09.2016
vi) Statement on declaration by independent directors:
The Company has received necessary declaration from each independent Director under Section 149(7) of the Companies Act, 2013, that he/she meets the criteria of independence as laid down in Section 149(6) of the Companies Act, 2013 and Regulation 25 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.
vii) Board Committees:
The Company has the following Committees of the Board:
(a) AUDIT COMMITTEE:
The primary objective of Audit Committee is to monitor and provide effective supervision of the managements financial reporting process with a view to ensure accurate, timely and proper disclosures and transparency in financial reporting. The Company has a qualified and independent Audit Committee comprising of Independent Directors. The Chairman of the Committee is an Independent Director.
Audit Committee of your Company as on date consists of following Non-executive Independent Directors:
|1. Mr. Saya Reddy Chennolla||Chairman|
|2. Mr. Ranga Reddy Mettu||Member|
|3. Mr. Prabhu Reddy Kandula||Member|
The committee met Four times during the financial year 30.05.2017, 15.07.2017, 10.11.2017 and 31.01.2018 attendance of each Memberof Committee is as follows:
|s. No.||Name of the Members||Designation||No. of Meetings held||No. of Meetings attended|
|1||Saya Reddy Chennolla||Chairman||4||4|
|2||Ranga Reddy Mettu||Member||4|||
|3||Prabhu Reddy Kandula||Member||4||4|
A Terms of Reference:
The recommendation for appointment, remuneration and terms of appointment of auditors of the Company
Review and monitor the auditors independence and performance and effectiveness of audit process.
Examination of the financial statementand auditors reportthereon.
Approval or any subsequent modification of transaction of the company with related parties.
Scrutiny of intercorporate loans and investments.
Valuation of undertakings or assets of the company, wherever it is necessary.
Evaluation of internal financial control and risk management systems.
Monitoring the end use of funds and related matters.
Others task as may be assigned by the board.
A Review of information:
a. Management discussion and analysis of financial condition and results of operations;
b. Statement of significant related party transactions, as defined by the Committee, submitted by the management;
c. Management letters/letters of internal control weaknesses issued by the statutory auditors;
d. Internal audit reports relating to internal control weaknesses; and
e. the appointment, removal and terms of remuneration ofthe Chief Internal Auditor
A Audit Committee Recommendation:
During the year, all the recommendations of the Audit Committee were accepted by the Board.
(b) NOMINATION AND REMUNERATION COMMITTEE:
A Brief description of terms of reference:
The Nomination and Remuneration Committee is vested with the powers relating to formulating the criteria for determining qualifications, positive attributes, independence of directors and recommend to the board a policy relating to the remuneration of the directors Key Managerial Employees and other employees.
The Committee shall also identify & screen candidates who qualify to become directors and may be appointed in senior management with the criteria laid down, evaluation of directors performance, approving and evaluating the compensation plans, policies and programs for executive directors and senior managements.
The Nomination & Remuneration Committee constitutes of following directors:
|1. Mr. Ranga Reddy Mettu||- Chairman|
|2. Mr. Saya Reddy Chennolla||- Member|
|3. Mr. Prabhu Reddy Kandula||- Member|
A Remuneration policy and details of remuneration paid to the Directors:
The policy framed by the Nomination and Remuneration Committee under the provisions of Section 178(4) of theAct, is as below:
The remuneration policy of the Company has been so structured in order to match the market trends of the Granite Industry. The Board in consultation with the Nomination and Remuneration Committee decides the remuneration policy for directors. The Company has made adequate disclosures to the members on the remuneration paid to Directors from time to time. Remuneration / Commission payable to Directors is determined by the contributions made by the respective directors for the growth of the Company.
Presently, the non-executive Directors do not receive any remuneration from the Company except sitting fees.
The aggregate value of salary and perquisites for the year ended 31.03.2018 to Managing Director is as under:
Remuneration paid / to be paid for Financial Year 2017-18 (in Rs.)
|Salary & Perks||Commission||Total|
|Mrs Leela Annapureddy||Managing Director||3,60,000||-||3,60,000|
(c) Stakeholders Relationship Committee:
Composition of Stakeholders Relationship Committee is as follows.
|1. Mr. Ranga Reddy Mettu||Chairman|
|2. Mr. Srinivas Reddy Annapureddy||Member|
|3. Mr. Saya Reddy Chennolla||Member|
The role of Stakeholders Relationship Committee is as follows:
1. Considering and resolving the grievances of shareholders of the Company with respect to transfer of shares, non-receipt of annual report, non-receipt of declared dividend, etc.;
2. Ensuring expeditious share transfer process in line with the proceedings of the Share Transfer Committee;
3. Evaluating performance and service standards of the Registrar and Share Transfer Agent of the Company;
viii) Vigil Mechanism:
The Company has established a whistle-blower policy and also established a mechanism for Directors and employees to report their concerns.
Whistle Blower Policy:
The Company has established a mechanism for employees to report concerns about unethical behaviors, actual or suspected fraud, and violation of Code of Conduct of the Company etc. The mechanism also provides for adequate safeguards against victimization of employees who avail the mechanism and also provides for direct access by the Whistle Blower to the Audit Committee. We affirm that during the Financial Year 2017-18, no employee has been denied access to the Audit Committee.
ix) Related Party Transactions:
Your Company has not entered into any transaction with the related parties during the financial year. Hence requirement of disclosure under Section 134(3)(h)r/wRule 8 of the Companies (Accounts) Rules, 2014 not applicable.
M/s. Suresh Gupta Y & Co., Chartered Accountants (FRN: 009012S), Statutory Auditors were appointed at the Twenty EighthAGM of the Company to hold the office for a period of five years until the conclusion of the 33rd Annual General Meeting of the Company to be held in the financial year 2022. The Company has obtained consent from the Auditors expressing their willingness to continue as statutory Auditors for financial year 2018-19 and that they are eligible for such continuation of their appointment.
Further pursuant to section 142 of the Companies Act, 2013 payment of remuneration to Auditors requires approval of members in general meeting, hence resolution commended for the approval of Shareholders to authorize the board to negotiate and fix their remuneration for FY 2018-19.
10. AUDITORS REPORT:
The Auditors Report for fiscal 2018 does not contain any qualification, reservation or adverse remark. The Auditors Report is enclosed with the financial statements in this annual report.
11. SECRETARIAL AUDITORS:
In accordance with the provisions of Section 204 of the Companies Act, 2013 and as a measure of good corporate governance practice, the Board of Directors of the Company appointed M/s. V K Bajaj & Associates, Practicing Company Secretaries, to conduct Secretarial Audit of the Company for the Financial Year 2017-18. The Secretarial Audit Report for Financial year 2017-18 is herewith appended as Annexure 1 to the Boards report.
With regard to adverse remarks in Secretarial Audit Report related to appointment of Company Secretary one of the Key Managerial Persons, your board of Directors would like inform you that company is putting all effort to recruit Company Secretary inspite of acute financial position of the company.
12. SIGNIFICANT AND MATERIAL ORDERS:
There are no significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and companys operations in the future.
13. EXTRACT OF ANNUAL RETURN:
In accordance with Section 134(3)(a) of the Companies Act, 2013, and extract of Annual Return in Form MGT 9 is annexed herewith as Annexure 2 to the Boards Report.
14. PARTICULARS OF LOANS, GUARANTEES AND INVESTMENTS U/S186:
The Company has not given any Loans, Guarantees and has not made any Investments falling under Section 186 of the Companies Act, 2013 for the financial year and does not have any loans and investments outstanding as on 31st March 2018. Hence disclosure pursuant to clause (g) of sub-section (3) of section 134 of the Companies Act, 2013 is not applicable to the company.
15. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO:
As Company is inoperativy, the particulars as prescribed under Section 134(3)(m) of the Act, read with Rule 8 of the Companies (Accounts) Rules, 2014, are NIL.
FOREIGN EXCHANGE EARNINGS AND OUTGO:
|Particulars||31st March, 2018|
|Foreign exchange earnings|||
|Foreign exchange outgo|||
16. PERFORMANCE OF THE BOARD OF DIRECTORS, ITS COMMITTEES AND INDIVIDUAL DIRECTORS:
In accordance with Section 134(3)(p) of the Companies Act, 2013 and Rule 8(4) of the Companies (Accounts) Rules, 2014, your Directors have reviewed and evaluated the performance of the Board of Directors and their committees, along with performance of individual Director in the light of Companys performance. The performance of the Directors individually and collectively and performance of committees are found satisfactory.
With the spirit of wealth creation forthe shareholders of the Company, your Directors are committed to give their best efforts towards the development of the Company.
17. MANAGEMENT DISCUSSION & ANALYSIS REPORT:
As per Regulation 34(2)(e) and para B of Schedule V of the SEBI (Listing Obligations & Disclosre Requirements) Regulations, 2015, management Discussion and Analysis report is attached and forms part of this report, as Annexure 3.
18. RISK MANAGEMENT:
Risks are events, situations or circumstances which may lead to negative consequences on the Companys businesses. Risk management is a structured approach to manage uncertainty. A formal enterprise wide approach to Risk Management is being adopted by the Company and key risks will now be managed within a unitary framework.
19. DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL)ACT, 2013:
The Company has in place an Anti Sexual Harassment Policy in line with the requirements of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. The Internal Complaints Committee ("ICC") has been set up to redress the complaints received regarding sexual harassment. All employees are covered underthis policy.
During the year there were no complaints referred to the ICC.
Your Directors have pleasure in recording their appreciation for the assistance extended to the Company by various officials of the Central and State Governments and Commercial Banks.
Your Directors would also like to place on record their sincere appreciation and gratitude to the Shareholders, Investors, Suppliers, Bankers for their support and co-operation. Your Directors express their heartfelt gratitude to the employees for their exceptional commitment and loyalty to the Company.
|Place: Kamareddy||By Order of the Board|
|Date: 05.10.2018||For SRI VAJRA GRANITES LIMITED|
|Leela Annapareddy||A. Srinivas Reddy|