DIRECTORS' REPORT Dear Members, Your Directors present the 30th Annual Report on the operations of your Company together with Annual Audited Accounts for the year ended 31st March, 2015. OPERATIONS During the year under review, the total sales of your Company were Rs.1605.09 lacs as against Rs.1680.75 lacs for the previous year. The Profit before financial charges and depreciation amounted to Rs.26.73 lacs as compared to Rs.62.99 lacs in the previous year. The net loss for the year was Rs.41.09 lacs as compared to Rs 6.08 lacs during previous year. CURRENT YEAR'S PERFORMANCE The Company is focusing on LED Products. In the 1st quarter ended June, 2015 the Company has recorded sales of Rs. 264.38 lacs as compared to Rs. 465.17 lacs for the corresponding period last year. The main reason for fall in sales is substantial increase in excise duty on LED products as per budget 2015. The excise duty is levied on MRP instead of transaction value. The excise duty has effectively doubled. This has resulted in steep increase in prices and hence loss of sale. The traditional lighting products which used to constitute almost over 50% of sale are also under tremendous pressure from cheap LED Products from China resulting in poor sale. The Company is trying to adjust to the changed situation and is hopeful of improving performance in coming quarters. DIVIDEND The Directors regret their inability to propose any dividend in view of the loss for the year under review. RESERVES During the year, no amounts has been transferred to Reserves. RESEARCH & DEVELOPMENT The Research and Development Department of your Company has been providing useful support towards developing of new products and improving quality of existing products. We have successfully developed many products in Lighting Electronics Industry which have been approved by International Certification Laboratory of Osram, the major customer of the Company. CONSERVATION OF ENERGY, TECHNOLOGY, ABSORPTION, FOREIGN EXCHANGE EARNING AND OUTGO Information relating to conservation of Energy, Technology Absorption etc., in terms of Section 134(3) (m) of the CompaniesAct,2013 read with relevant rules is enclosed as per Annexure-I. SHARE CAPITAL During the year under review, no changes has been done in the Share Capital of the Company. The Company allotted 218804Unsecured Zero Coupon Convertible Bonds ("Bonds") of face value of Rs. 1000/- each to promoters / strategic investor against loans taken over by them from secured creditors / their assignees. The said bonds are convertible into equity shares of the Company, after lock-in period in terms of the Rehabilitation Scheme sanctioned by Hon'ble BIFR in July 2014. FIXED DEPOSITS: Your Company has not accepted any deposits within the meaning of Section 73 of the Companies Act, 2013 and the Companies (Acceptance of Deposits) Rules, 2014. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS: The Company has not given any loans or guarantees covered under the provisions of Section 186 of the Companies Act, 2013. INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY: The Company has adequate internal control systems and procedures designed to effectively control the operations. The internal control systems are designed to ensure that the financial and other records are correct and reliable for the preparation of financial statements and for maintaining assets. The Company has well designed Standard Operating Procedures. Independent Internal Auditors conduct audit covering a wide range of operational matters and ensure compliance with specified standards. Planned periodic reviews are carried out by Internal Audit. The findings of Internal Audit are reviewed by the top management and by the Audit Committee of the Board of Directors. The Audit Committee also meets the company's Statutory Auditors regularly to ascertain their views on the financial statements, including the Financial Reporting Systems, Compliance to Accounting Policies and Procedures, the adequacy and effectiveness of the Internal Controls and Systems followed by the company. DIRECTORS In accordance with the provisions of the Companies Act, 2013,Mr. Aijaz Ghaffar, Director of the Company retires by rotation and has not offered himself for re-appointment. Dr. Om Prakash Sood was appointed as Additional Director (Independent) on February13, 2015, who shall hold office upto the ensuing Annual General Meeting. The Companies Act, 2013 requires that a women Director should be member of the Board of Directors. Ms. Yuvika Bader was appointed as an Additional Director (Non-Executive) of the Company on March 19, 2015, and she holds office up to the ensuing Annual General Meeting. Approval for appointment of Dr. Om Prakash Sood (Independent Director) for a period of five (5) years) is being sought in the Annual General Meeting. Approval for appointment of Ms. Yuvika Bader as Director on the Board is also being sought in the AGM. She will be liable to retire by rotation, as per Companies Act, 2013. The information on the particulars of Directors eligible for appointment in terms of Clause 49 of the Listing Agreement has been provided in the notes to the notice convening the Annual General Meeting. The requisite resolutions pertaining to the Appointment/Re-appointment appears at the respective items of the notice along with the Explanatory Statement and are recommended to the shareholders for approval. All independent directors have given declarations that they meet the criteria of independence as laid down under Section149(6) of the Companies Act, 2013 and clause 49 of the Listing Agreement. KEY MANAGERIAL PERSONNEL Mr. Nitin Gupta has been appointed as Chief Financial Officer of the Company effective from August 13, 2015. BOARD EVALUATION Pursuant to the provisions of the Companies Act, 2013 and Clause 49 of the Listing Agreement, the Board has carried out an evaluation of its own performance, the directors individually as well as the evaluation of the working of its Audit Committee, Nomination& Remuneration Committee and Stakeholders' Relationship Committee. The manner in which the evaluation has been carried out has been explained in the Corporate Governance Report. Remuneration Policy The Board has, on the recommendation of the Nomination& Remuneration Committee framed a policy for selection and appointment of Directors, Senior Management and their remuneration. The Remuneration Policy has been placed on the website of the Company www.calcomindia.com. Meetings During the year, four Board Meetings and four Audit Committee Meetings were convened and held. The details of the said meetings are given in the Corporate Governance Report. The intervening gap between the Meetings was within the period prescribed under the Companies Act, 2013. DIRECTORS' RESPONSIBILITY STATEMENT: In terms of Section 134 (5) of the Companies Act, 2013, the directors would like to state that: i)In the preparation of the annual accounts, the applicable accounting standards have been followed. ii)The directors have selected such accounting policies and applied them consistently and made judgments and estimates that were 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 or loss of the Company for the year under review. iii)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 fraud and other irregularities. iv)The directors have prepared the annual accounts on a going concern basis. v)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. vi)The directors had devised proper system to ensure compliance with the provisions of all applicable laws and that such system were adequate and operating effectively. RELATED PARTY TRANSACTIONS: All related party transactions that were entered into during the financial year were on arms' length basis and were in the ordinary course of the business. There are no materially significant related party transactions made by the company with Promoters, Key Managerial Personnel or other designated persons which may have potential conflict with interest of the company at large. The particulars of contracts or arrangements with related parties referred to in Section 188(1) of the Act for the financial year 2014-15 in the prescribed format AOC-2 is enclosed with the report as Annexure- II. SUBSIDIARY COMPANIES: The Company does not have any subsidiary or associate company. CODE OF CONDUCT: The Board of Directors has approved a Code of Conduct which is applicable to the Members of the Board and all employees in the course of day to day business operations of the company. The Company believes in "Zero Tolerance" against bribery, corruption and unethical dealings / behaviors of any form and the Board has laid down the directives to counter such acts. The code laid down by the Board is known as "Code of Business Ethics" which forms an Appendix to the Code. The Code has been posted on the Company's website www.calcomindia.com. All the Board Members and the Senior Management personnel have confirmed compliance with the Code. All Management Staff were given appropriate training in this regard. VIGIL MECHANISM / WHISTLE BLOWER POLICY: Pursuant to Section 177(9) of the Companies Act, 2013, the Company has established Vigil Mechanism for directors, employees, suppliers, contractors and other stakeholders etc of the Company. The same is also intended to cover the Whistle Blower Policy under the aspect of Clause49 of the SEBI's listing agreement. The purpose and objective of this Policy is to cover serious concerns that would have a larger impact on image and values of the company due to incorrect financial reporting or serious improper conduct. The Audit Committee of the Directors of the Company looks into the complaints raised. PREVENTION OF INSIDER TRADING: The Company has adopted a Code of Conduct for Prevention of Insider Trading with a view to regulate trading insecurities by the Directors and designated employees of the Company. The Code requires pre-clearance for dealing in the Company's shares and prohibits the purchase or sale of Company shares by the Directors and the designated employees while in possession of unpublished price sensitive information in relation to the Company and during the period when the Trading Window is closed. The Board is responsible for implementation of the Code. All Board Directors and the designated employees have confirmed compliance with the Code. AUDITORS: The retiring Auditors of the Company M/s. Shanti Prashad& Co., Chartered Accountants (Firm Registration No 019923N) retire at the conclusion of the ensuing Annual General Meeting and being eligible, offer themselves for re-appointment. The Company has received a certificate from them that their re-appointment, if made, would be within the prescribed limits under Section 139 read with Section 141 of the Companies Act, 2013. SECRETARIAL AUDIT: Pursuant to provisions of section 204 of the Companies Act, 2013 and The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the company has appointed Ms Alka Juneja, Company Secretary in practice (M.No. 35859) to undertake the Secretarial Audit of the Company. The Secretarial Audit report is annexed herewith as "Annexure-III" AUDITOR'S REPORT: The Auditors in their report have invited attention on Emphasis of Matter Notes on Accounts-Note No. 16 on non-provisioning for receivables outstanding for more than 6 months. The notes are self-explanatory. However directors would like to inform you that the Management is trying its best to recover the receivables in full; hence no provision has been made. SECRETARIAL AUDIT REPORT As required under section 204 (1) of the Companies Act, 2013 the Company has obtained a secretarial audit report for the financial year 2014-15 which is self-explanatory. There are no Qualification remark in Secretarial Audit Report, except in respect of appointment of Key Managerial Personnel viz. Chief Financial Officer and Company Secretary. The Company has since appointed a Chief Financial Officer and are looking for suitable candidate for position of Company Secretary. EXTRACT OF ANNUAL RETURN The details forming part of the extract of the Annual Return in form MGT-9 is annexed herewith as "Annexure- IV". PARTICULARS OF EMPLOYEES The information required pursuant to Section 197 read with rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of employees of the Company, is not required to be given as there are no employees drawing remuneration more than the limits prescribed under said rules. INDUSTRIAL RELATIONS: During the year under review, your Company enjoyed cordial relationship with workers and employees at all levels. MANAGEMENT DISCUSSION AND ANALYSIS A report in the form of Management Discussion and Analysis pursuant to clause 49 of the listing agreement, as a part of this report is annexed hereto as Annexure-V. CORPORATE GOVERNANCE A separate section on Corporate Governance forming part of the Directors' Report and the certificate from the auditors of the Company confirming the compliance of Clause 49 of listing agreement is included in the annual report as Annexure-VI. A Certificate has been given by the Chairman & Managing Director and Manager (Finance & Accounts) to the Board, as per requirement of Clause 49 (V) of the Listing Agreement is attached to the report. RISK MANAGEMENT POLICY The Company is in process of adopting a comprehensive risk management policy covering processes for identification and mitigation of all potential risks in line with group risk framework and adjusted to suit the business requirements of the Company. POLICY AGAINST SEXUAL HARASSMENT The Company has framed a policy against sexual harassment of employees and has also constituted an Internal Complaints Committee to handle such cases. No such cases were reported during the year. ACKNOWLEDGEMENT Your Directors are grateful to the various Government Authorities, Financial Institutions and Banks, Business Constituents and Shareholders for their continued co-operation and support to the Company. Your Directors also express their deep appreciation of the devoted and unstinted services tendered by workers, staff and executive at all levels. For and on behalf of the Board of Directors S.K. MALIK DIN: 00085715 Chairman & Managing Director Place: New Delhi Date: August 13, 2015 |