DIRECTORS’ REPORT
TO
THE MEMBERS,
Your Directors have pleasure in presenting the 28th Annual Report of the Company together with the Standalone Audited Financial Statements of Accounts for the year ended March 31, 2018.
1. FINANCIAL RESULTS
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(Rs. In Lacs)
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Particulars
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2017-18
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2016-17
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Gross Income
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728.54
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868.34
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Profit/ (Loss) before tax and Exceptional items
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(319.06)
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(814.25)
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Less: Exceptional items
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27.73
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181.14
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Profit/ (Loss) before tax
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(346.80)
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(995.39)
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Less: Tax Expenses
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(20.65)
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(80.17)
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Profit/ Loss after tax
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(399.45)
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(931.22)
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2. REVIEW OF BUSINESS OPERATION
The Company is engaged in the business domestic retail trade of gold jewellery and other precious metal ornaments. During the year, the revenue from operations was Rs. 728.54 Lacs as compared to the revenue of Rs. 868.34 Lacs in the year 2016-17. The current year Loss after tax Rs. 399.45 Lacs as compared to the Loss after tax of last year of Rs.931.22 Lacs.
3. DIVIDEND
In view of the loss, your Directors regret their inability to recommend dividend for the Financial Year 2017-18.
4. MATERIAL CHANGES AFFECTING FINANCIAL POSITIONS OF THE COMPANY
No material changes have occurred and commitments made, affecting the financial position of the company, between the end of the financial year of the company and the date of this report.
5. RESERVES AND SURPLUS
During the Financial Year 2017-18, the company has not transferred any amount to its Reserves and Surplus.
6. SHARE CAPITAL
The Authorized Share Capital of the Company is Rs. 200,00,00,000/- (Rupees Two Hundred Crore) comprising 2,00,000,000 (Twenty Crore) Equity Shares of Rs. 10 (Rupees Ten) each. The Issued, Subscribed and Paid-up Equity Share Capital of the Company is Rs. 100,65,45,330/- (Rupees One Hundred Crore Sixty Five Lacs Forty Five Thousand Three Hundred and Thirty) consisting of 1,00,65,45,33 (Ten Crore Six Lacs Fifty Four Thousand Five Hundred Thirty Three) Equity Shares of Rs. 10 (Rupees Ten) each.
The Company has not allotted any shares during the year under review.
7. DIRECTORS AND KEY MANAGERIAL PERSONNEL
Re-appointment
The Board re-appointed Ms. Mandira Mutum as Whole Time Director of the Company effective 01st April, 2018 to 31st March, 2019 based on the recommendation of the Nomination & Remuneration Committee. The Board recommends her re-appointment.
The information on the particulars of Director eligible for appointment in terms of Regulation 33 (3) of sEBi (Listing Obligations and Disclosure Requirements) Regulations, 2015 has been provided in the Explanatory Statement of the notice convening the Annual General Meeting.
Retirement
As per the provisions of the Companies Act, 2013, Mr. Nanda Kumaran Puthezhath will retire by rotation at the ensuing AGM and being eligible offered himself for reappointment. The Board recommends his re-appointment.
8. INDEPENDENTDIRECTORSDECLARATION
The Independent Directors have confirmed and declared that they are not disqualified to act as an Independent Director in compliance with the provisions of Section 149 of the Companies Act, 2013 and the Board is also of the opinion that the Independent Directors fulfill all the conditions specified in the Companies Act, 2013 making them eligible to act as Independent Directors.
9. BOARD MEETINGS
The details of number and dates of meetings held by the Board and its Committees, attendance of Directors and sitting fee/ commission/ remuneration paid to them is given separately in the Corporate Governance Report.
10. BOARD EVALUATION
In compliance with the Companies Act, 2013 and Regulation 17(10) of SEBI (Listing Obligations and Disclosure Requirements), Regulations, 2015, the performance evaluation of the Board was carried out during the year under review. More details on the same are given in the Corporate Governance Report.
11. REMUNERATION POLICY
The company follows a policy on remuneration of Directors and Senior Management Employees. The policy is approved by the Nomination and Remuneration Committee and the Board. More details on the same are given in the Corporate Governance Report.
The policy is available on the company’s website and web link for the same is https:// www.atlasjewelleryindia.com/wp-ntent/ uploads/2018/01/NRCC V02 1718.pdf. The policy is designed to attract, motivate and retain manpower by creating congenial work environment and inculcating a sense of belonging, besides offering appropriate remuneration package and superannuation benefits. The appointment and remuneration of Executive Directors is based on merit and seniority of person. Non- Executive Directors are paid sitting fee in accordance with the Companies Act, 2013.
12. STAKEHOLDER RELATIONSHIP COMMITTEE
Stakeholder Relationship Committee comprises of Mr. K. Mohandas as Chairman, Dr. (Mr.) Sunil Kumar Gupta, Mr. Bashyakar Mattapalli, Ms. Reema Jain and Mr. Nanda Kumaran Puthezhath as members. The details of term of reference of the Committee member, dates of meeting held and attendance of the Directors are given separately in the Corporate Governance Report.
13. AUDIT COMMITTEE
The Audit Committee comprises of Mr. Bashyakar Mattapalli as Chairman, Dr. (Mr.) Sunil Kumar Gupta, Ms. Reema Jain Mr. Mohandas K and Ms. Mandira Mutum as members. The details of term of reference of the Audit Committee member, dates of meeting held and attendance of the Directors are given separately in the Corporate Governance Report.
14. NOMINATION & REMUNERATION COMMITTEE
The Nomination & Remuneration Committee comprises of Ms. Reema Jain as Chairperson, Dr. (Mr.) Sunil Kumar Gupta, Mr. Mohandas K, and Mr. Bashyakar Mattapalli as members. The details of term of reference of the Nomination & Remuneration Committee member, dates of meeting held and attendance of the Directors are given separately in the Corporate Governance Report.
15. CODE OF CONDUCT
Directors, Key Managerial Personnel and senior management of the Company have confirmed compliance with the Code of Conduct applicable to the Directors and employees of the Company and the declaration in this regard made by the Whole time Director is attached as ANNEXURE-I which forms a part of this Report of the Directors. The Code of Conduct is available on the Company’s website.
16. DISCLOSURE AS PER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013
The company has a policy which has been made part to the ATLAS Code of Business Conduct and Ethics applicable to all the employees of the Company on prohibition, prevention and redressal of Sexual Harassment of women at workplace and matters connected therewith or incidental thereto covering all the aspects as contained under “The Sexual Harassment of women at workplace (Prohibition, Prevention and Redressal) Act, 2013”.
During the year under review the Company has also organized an awareness programme on The Sexual Harassment of Women at Workplace (Prevention, Prohibition And Redressal) Act, 2013 on 24.08.2017 for all the employees of the Company.
During the financial year 2017-18, no complaint was received under the policy.
17. PARTICULARS OF EMPLOYEES
Information in accordance with the provisions of Section 134(3)(q) and Section 197(12) ofthe Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, regarding employees is given in ANNEXURE-II.
18. AUDITORS AND AUDITOR’S REPORT
The auditors M/s. A. Kay. Mehra & Co., Chartered Accountants (FRN: 050004C), retire at the ensuing Annual General Meeting and being eligible, offer themselves for reappointment for a period of 1 year from the conclusion of this Annual General Meeting [AGM] till the conclusion of the next AGM to be held in year 2019. They have confirmed their eligibility under Section 141 of the Companies Act 2013 and the Rules framed there under for re-appointment as auditors of the Company. The Members are requested to confirm the re-appointment of Statutory Auditors.
There are disclaimer remarks made by the Auditors in their Report.
Clarification of the Management in respect of disclaimer remarks of Auditor’s Report are as follows:
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S.
NO.
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DISCLAIMER
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MANAGEMENT REPLY
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1.
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Trade Receivables amounting to Rs. 1,35,12,86,431/-includes an overseas debtor “M/S Satwa Precious Metals & Bullion Trading (FZE)” amounting to Rs. 1,35,12,71,281/ (including foreign currency exchange gain or loss) which are outstanding for more than two years and are subject to confirmation/ reconciliation and adjustments. Since, there have been defaults in payment obligations by the overseas debtor on due dates and recoveries from this debtor are not significant, the Company has filed a recovery suit against the said party bearing No. IOP No. 7 of 2016 before the Honorable Sub Court, North Paravoor, Kerala for recovery of its entire export dues. As the matter is under judicial review the company has not created any provision for the bad and doubtful debts in the current financial year. In view of the factors stated above and in the absence of clear forward looking information regarding outcome of pending legal action initiated and time frame of reliability of this Trade Receivable, we are unable to determine the amount of expected credit loss/ impairment based on provision matrix as per the requirements of Ind-AS 109 “Financial Instruments” and its consequential impact, on the financial statements.
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The export trade receivables as mentioned above has been accepted by the Export Debtor and there is no dispute regarding the amount due and payable by the said party as per communications received from the said export debtors. The Company had subsequently filed a recovery suit against the said party bearing No. IOP No. 7 of 2016 before the Honourable Sub Court, North Paravoor, Kerala for recovery of its entire export dues. The export debtor had raised before the Honourable Sub Court the issue of jurisdiction of the said Court to try the matter. The Honourable Sub Court vide its interim Order dated 4.10.2017 had found no merit in the said contention regarding jurisdiction and answered the same in favour of the Company. The Company is confident that the Court would give a favorable judgment in its favour.
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2.
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Reserve Bank of India (RBI) approval is still pending on the application as forwarded by the “AD”bank on behalf of the company regarding seeking prior approval from the RBI for the extension of the period of realization of the overdue export receivables. In view of the factors stated above and in the absence of any clear outcome from the RBI, we are unable to form an opinion due to the uncertainties and their possible cumulative effects on the financial statements.
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The Company has also filed an extension application for the over-due export invoices with Axis Bank (AD Banker) on 16.12.2017 as per RBI Master Circular. The same is awaiting RBI approval as per letter received from the said banker. Further as per RBI Master Circular C.18(f) “ Extension of Time” the same shall be granted irrespective of the amount involved in case where the exporter has filed suits abroad. The Company has filed the suit in India bearing No. IOP No. 7 of 2016 and the same has been accepted by the Honourable Sub Court vide its interim order dated 4.10.2017 further as per Indian and UAE bilateral legal and judicial cooperation treaty dealing with the reciprocal recognition and enforcement of foreign judgments with India (Federal Decree No.83 of 2000). Hence the decree from Indian Court can be executed in U.A.E. if circumstances demand.
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3.
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During the year there was a summon received by the company from the “Directorate of Enforcement” to provide details in respect of export proceeds pending for realization and for tendering statement in this regards. In response of the above mentioned summon, the company has submitted relevant information and documents to the concerned department in the prescribed manner, however, the outcome regarding such summon issued by the concerned department is still pending from the part of competent authority.
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The Company had provided all the necessary information and record sought from it.
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4.
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A statement from the company in Notes to the financial statements describes that “There was a complaint filed in "Economic Offence Wing (EOW)” against the company and its promoters by Commercial Bank of Dubai (Complainant) in the preceding year. The complainant has mixed up issues and tried to bring a private arrangement between the Complainant and the promoter which had purportedly taken place sometime in April, 2013 in United Arab Emirates (U.A.E) to India and make our Company, as parties to the complaint. The Company is no way connected to the alleged transaction nor concerned with the same or has been aware of the same till the complaint was lodged. However, the Company as a law abiding citizen had provided all the necessary information as being sought from it by the investigating officer and fully co-operating and supporting the investigation in order to bring the matter for an early closure”.
This enquiry by the “Economic Offence Wing”, in respect of the complaint filed by the "Commercial Bank of Dubai” (Complainant) against the company and its promoters is still pending before the competent investigating authority.
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As stated by the auditors themselves, the complainant has mixed up issues and tried to bring a private arrangement between the Complainant and the promoter which had purportedly taken place sometime in April, 2013 in United Arab Emirates (U.A.E) to India and make our Company, as parties to the complaint. The Company is no way connected to the alleged transaction nor concerned with the same or has been aware of the same till the complaint was lodged. However, the Company as a law abiding citizen had provided all the necessary information to the Investigating Officer and impressed upon him that the Company nor its directors are any way concerned or a party to the transaction which purportedly took place in Dubai between the promoters and the complainant.
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5.
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The Company's operating results have been
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The Board of the Company has been taking all necessary
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materially affected due to various factors including
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steps to turn around the operations of the Company
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non-realization of Trade receivables, non-recovery
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including cost rationalization, aggressively follow upon
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of loans and advances, continuously termination of
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recovery, streamlining operations etc. and the Board is
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lease agreements, reliance on cash sales for meeting out expenses, overall substantial decrease in volume of business and sales, overdue expenses payable, pending income tax demands, continuous increase of litigation matters, etc. These events cause significant doubts on the ability of the company to continue as a going concern. The appropriateness of going concern assumption is dependent on the company's ability to raise adequate finance from alternative means and / or recoveries from Trade Receivables to meet its short term and long term obligations as well as to establish consistent business operations.
In the absence of any convincing audit evidences regarding certainty and time frame for recovery from Trade Receivables, outcome of pending legal action initiated against debtor, pending RBI approval for export realization extension, legal matters initiated against company and in view of multiple uncertainties as stated above we are unable to determine the possible effect on the financial result. We are also unable to conclude on ability of the company to carry on as a going concern.
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confident that the company will show improvement.
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19. COST AUDIT
Cost Audit is not applicable on your Company.
20. SECRETARIAL AUDITORS AND SECRETARIAL AUDIT REPORT
Pursuant to the provisions of Section 204 of the Companies Act 2013 and the Companies (Appointment & Remuneration ofManagerial Personnel) Rules 2014 the Company has appointed, M/s. Parveen Rastogi & Co., Practicing Company Secretaries (COP No. 2883) to undertake the Secretarial Audit of the Company for the financial year 2017
18. The report of the Secretarial Auditors is annexed as ANNEXURE-III to this report.
There are no qualifications or observations, or remarks made by the Secretarial Auditor in their Report.
21. LOANS, GUARANTEES OR INVESTMENT
There were no loans, guarantees or investments made by the Company under Section 186 of the Companies Act, 2013 during the year under review and hence the said provision is not applicable.
22. FIXED DEPOSIT
Your company has not accepted any fixed deposit and, accordingly no amount was outstanding as at the Balance Sheet date.
23. SIGNIFICANT AND MATERIAL ORDERS
There were no significant or material orders passed by the Regulators, Courts or Tribunals which impact the going concern status of the Company and its future operations.
24. ADEQUACY OF INTERNAL CONTROLS AND COMPLIANCE WITH LAW
The Company during the year has reviewed its Internal Financial Control (IFC) systems and has continually contributed to establishment of more robust and IFC framework, prescribed under the ambit of Section 134(5)(e) of the Companies Act, 2013. The preparation and presentation of the financial statements is pursuant to
the control criteria defined considering the essential components of Internal Control- as provided in the “Guidance Note on Audit of Internal Financial Controls over Financial Reporting’s issued by the Institute of Chartered Accountants of India.”
The control criteria ensure that orderly and efficient conduct of the Company’s business including adherence to its polices, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records and the timely preparation of reliable financial information.
There are no instances of fraud which necessitates reporting of material misstatement to the Company’s operations.
There has been no communication from regulatory agencies concerning noncompliance with or deficiencies in financial reporting practices.
25. RELATED PARTY TRANSACTIONS
There were no contract or arrangements entered into with related parties as defined under Section 188 of the Companies Act, 2013 and Regulation 23 of the SEBI (Listing Obligations Disclosure Requirements) Regulations 2015 during the year under review.
26. SUBSIDIARIES
The Company does not have any subsidiary within the meaning of the Companies Act, 2013.
27. EXTRACT OF ANNUAL RETURN
The particulars required to be furnished under Section 134(3)(a) of the Companies Act, 2013 read with Companies (Management and Administration) Rules, 2014 as prescribed in Form No. MGT-9 is given in ANNEXURE-IV.
28. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNING AND OUTGO
The particulars required to be furnished under Section 134(3)(m) of the Companies Act, 2013 are set out in ANNEXURE-V, which forms part of the report.
29. LISTING
The equity shares of your Company are listed with the Bombay Stock Exchange, Ahmedabad Stock Exchange, Jaipur Stock Exchange and Delhi Stock Exchange (Jaipur Stock Exchange and Delhi Stock Exchange were de-recognized by SEBI w.e.f. March 23, 2015 and January 23, 2017 respectively).
30. DEMATERIALISATION OF SHARES
The shares of your Company are being traded in electronic form and the Company has established connectivity with both the depositories i.e. National Securities Depository Limited (NSDL) and Central Depository Services (India) Limited (CDSL). In view of the numerous advantages offered by the Depository system, members are requested to avail the facility of dematerialization of shares with either of the Depositories as aforesaid. As on March 31, 2018, 98.79% of the share capital stands dematerialized.
31. CORPORATE GOVERNANCE
As per the applicable provisions of Schedule
V of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, a detailed Corporate Governance Report has been given in this Report. A certificate from Practicing Chartered Accountant confirming compliance with the conditions of Corporate Governance as stipulated under Schedule
V of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 is annexed as ANNEXURE-VI.
32. VIGIL MECHANISM
The Company has a whistle blower mechanism wherein the employees can approach the management of the company (Audit Committee Chairman in case where the concern involves the Senior Management) and make protective disclosures to the management about the unethical behavior, actual or suspected fraud or violation of the Company's Code of Conduct. The Policy requires every employee to promptly report to the management actual or possible violation of the code or an even he becomes aware of that could affect the business or reputation of the company.
No person has been denied access to the Chairman to report any concern. Further, the said policy as been disseminated within the Organization.
33. COMPLIANCE WITH SECRETARIAL STANDARD
Secretarial Standard 1: Meetings of the Board of Directors and Secretarial Standard 2: General Meetings, as applicable have been complied by the company
34. MANAGEMENT DISCUSSION & ANALYSIS REPORT
The Management Discussion and Analysis Report, as required by Schedule V of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, is annexed herewith as ANNEXURE-VII to this Report
35. ANNEXURES FORMING A PART OF BOARD’S REPORT
The Annexure referred to in this Report and other information which are required to be disclosed are annexed herewith and form a part of this Report:
36. DIRECTOR’S RESPONSIBILITY STATEMENT
Based on the framework of Internal Financial Controls and compliance system established and maintained by the company, the work performed by the internal, statutory and secretarial auditors, including audit of internal financial controls over financial reporting by the statutory auditors and the reviews performed by management and the Audit Committee, the Board is of the opinion that the Company's Internal Financial Controls are adequate and operating effectively during the FY 2017-18.
Accordingly, pursuant to the requirements of Section 134(3)(c ) of the Companies Act, 2013, your Directors hereby confirm that :
i. In preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material
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ANNEXURE
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PARTICULARS
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I
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Whole Time Director's Certificate under Schedule V Part D of SEBI (Listing Obligations and Disclosure Requirements) Regulations,
2015 on compliance of Code of Conduct
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II
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Particulars of Employees under Section 134(3](q] and Section 197(12) of the Companies Act, 2013
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III
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Secretarial Audit Report
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IV
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Extract of Annual Return-MGT-9
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V
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Particulars of Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo
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VI
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Compliance Certificate on Corporate Governance
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VII
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Management Discussion and Analysis Report
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departures;
ii. They 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 at the end of financial period and of profit or loss of the Company for that period;
iii. They 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;
iv. They have prepared the annual accounts on a “going concern basis”.
v. They have laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively; and
vi. They have devised proper system to ensure compliance with the provision of all applicable laws and that such systems were adequate and operating effectively.
37. GREEN INITIATIVE
Electronic copies of the Annual Report 2017- 18 and the Notice of the 28th Annual General Meeting are sent to all the members whose email address(s) are registered with the Company or depository participant(s). For members who have not registered their email address, physical copies are sent in the permitted mode.
38. CAUTIONARY STATEMENT
Statements in the Board’s Report and the Management Discussion and Analysis
Report describing the Company’s objectives, expectations or forecasts may be forward looking within the meaning of applicable securities laws and regulations.
Actual results may differ materially from those expressed in the statement. Important factors that could influence the Company’s operations include the status of the promoters, change in government regulations, tax laws, economic developments within the country and other factors such as litigation, arrangement of funds.
The Company assumes no responsibility in respect of the forward-looking statements, which may undergo changes in future on the basis of subsequent developments, information or events.
39. APPRECIATIONS
Your Directors wish to place on record their appreciation for the continuous support received from the Members, customers, suppliers, bankers, various statutory bodies of the Government of India and the Company’s employees at all levels.
Date: 09.08.2018
Place: Bangalore
For and on behalf of the Board of Directors
For ATLAS Jewellery India Limited
Sd/- Sd/-
Mandira Mutum Reema Jain
Whole Time Director Independent
DIN: 07747235 Director DIN: 07234917
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