The Directors are pleased to present their Seventy Ninth Annual Report
on the business and operations of the Company (or CG) along with the
audited accounts for the financial year ended 31 March 2016.
THE YEAR IN RETROSPECT
The Stand-alone and Consolidated financials of the Company represents
the continuing operations for the year ended 31 March 2016. The
operations, assets and liabilities of the discontinued operations have
been presented under separate head.
The continued consolidated net revenue of the Company during 20152016
de-grew by 4.2% at Rs.5272 crore, as compared with Rs.5505 crore last
year. The Company has achieved a stand-alone net turnover from
continued operations of Rs.3960 crore, during the year under review, as
compared with Rs.4230 crore during the previous year, a decline of
Consolidated profit before tax from continuing operations decreased to
Rs.87 crore, as compared with Rs.356 crore in the previous year, a
decrease of 75.4% over last year. Stand-alone profit / (loss) before
tax from continuing operations decreased from Rs.342 crore to Rs.(1150)
crore, a decrease of 436.6%.
Consolidated loss before tax from discontinued operations increased to
Rs.(343) crore from Rs.(182) crore, in the previous year, an increase
Consolidated profit after tax from continuing operations is Rs.75 crore
as compared with consolidated profit after tax of Rs.368 crore in the
previous year, a decrease of 80%. The Company recorded a stand-alone
profit / (loss) after tax from continuing operations of Rs.(1188)
crore, a decrease of 444.3% from Rs.345 crore last year.
The Sales and Profit Before Interest and Tax (PBIT) of the respective
Business Groups, compared with last year are given in Table 1.
A detailed review of the operations and performance of the Company and
each of the Businesses including its International operations is
contained in the Management
01 SALES AND PROFIT BEFORE INTEREST AND TAX (PBIT)
IN RS. CRORE
BU SALES PBIT
2015-2016 2014-2015 2015-2016 2014-2015
Power Systems (CG
Stand-alone) 2290 2696 117 200
(CG Stand-alone) 1611 1497 174 151
(CG Stand-alone) 75 51 (10) 10
national operations) 2495 2786 188 402
operations) 1929 1834 139 110
Automation Systems 864 900 (6) 7
Discussion and Analysis Report, which is given as a separate chapter in
this Annual Report.
The financial performance of your Company for the continuing operations
for the year ended 31 March 2016 is given in Table 2.
DEMERGER OF CONSUMER BUSINESS
Pursuant to the approval of shareholders of the Company accorded on 13
August 2015, for the Scheme of Arrangement (Scheme) between the Company
and Crompton Greaves Consumer Electricals Limited (CGCEL), the Company
has completed with the demerger of its Consumer Products Business, with
effect from 1 October 2015 upon sanction of the Scheme by the Hon''ble
High Court, Bombay on 20 November 2015 and filing the same with the
Registrar of Companies on 31 December 2015 by the Company. Pursuant to
the Scheme, the shareholders of the Company have been allotted one
equity share of Rs.2/- in CGCEL for every equity share of Rs.2/- each
held in the Company as on 16 March 2016 being the Record Date fixed for
this purpose, which were listed on the BSE and NSE with effect from 13
DIVESTMENTS AND OTHER DEVELOPMENTS
With the strategic objective of debt reduction and focusing on its core
operations in Power business in India and in its Industrial Systems
business, the following divestments have been completed / undertaken by
- The Company has sold the Power Assets held by its subsidiary CG Power
Systems Canada Inc, thereby exiting from the Power business in Canada.
- The Company has divested its entire stake in the Joint Venture CG
Lucy Switchgear Limited (presently Lucy Electric India Private Limited)
to W Lucy & Co Limited, UK-the Joint Venture Partner, while retaining
its distribution and supply arrangements with Lucy Electric India
- The Company has signed a Share Purchase Agreement (SPA) for sale of
its Power Businesses in Europe, North America and Indonesia. The
completion of the SPA is envisaged by 31 October 2016, subject to
requisite consents and regulatory approvals. Upon completion, the
Company would exit completely from its overseas Power businesses.
- The Company has also initiated the process of identifying investors
for its other international B2B businesses including Automation
02 FINANCIAL HIGHLIGHTS
2016 2015 2016 2015
PARTICULARS STAND-ALONE CONSOLIDATED
Revenue from Operations
(Net of Excise Duty) 3,960 4,230 5,272 5,505
EBIDTA 308 331 453 580
Less: Finance Cost (102) (21) 56 82
Less: Depreciation 108 113 256 245
Exceptional Items & Tax 302 239 141 253
Exchange gain 57 (47) 57 (47)
Exceptional Items (1509) 150 (111) 150
Before Tax (1150) 342 87 356
Less: Tax Expense 38 (3) 14 (10)
After Tax (1188) 345 73 366
Share of profit /
(loss) in associates - - 1 1
Interest - - 1 1
Profit / (loss) from
continuing operations (1188) 345 75 368
Profit / (loss) from
operations 157 371 (343) (182)
Tax expense from
operations 61 127 128 163
Net Profit / (loss)
operations 96 244 (471) (345)
Net Profit / (loss)
for the year attri
butable to shareholders (1092) 589 (396) 23
The above steps will enable the Company to improve its Balance Sheet
and enhance shareholders value by refocusing on operations and growth
in India, considering the opportunities in India, in view of the
emphasis of the Government on the Power sector and the growth in demand
of the products in the Industrial Systems'' business in India and
During the year, the Distribution Franchisee Agreement (DFA) of the
Company with Maharashtra State Electricity Distribution Company Limited
(MSEDCL) for power distribution at Jalgaon in Maharashtra was
terminated by MSEDCL exercising its step- in rights consequent to
certain unresolved disputes. The Company is confident of arriving at an
amicable settlement with MSEDCL on all pending issues under the DFA.
No dividend has been recommended or paid for the year ended 31 March
The Reserves, on stand-alone basis, at the beginning of the year were
Rs.4490 crore. The Reserves at the end of the year are Rs.4003 crore.
As at 31 March 2016, the authorised share capital of the Company was
Rs.407,60,00,000-(Rupees four hundred seven crore sixty lacs) divided
into 203,80,00,000 equity shares of Rs.2/-(Rupees Two) each.
As at 31 March 2016, the paid-up share capital of the Company stood at
Rs.125,34,92,284 (Rupees one hundred twenty five crore thirty four lacs
ninety two thousand two hundred eighty four only) consisting of
626,746,142 equity shares of Rs.2/-(Rupees Two) each.
DIRECTORS AND KEY MANAGERIAL PERSONNEL BOARD OF DIRECTORS
As on the date of this report, the Company''s Board comprises of ten
Directors. The Chairman, Mr Gautam Thapar is a Non- Executive Director
and represents the Promoter Group. Mr K N Neelkant is the CEO and
Managing Director. Mr Madhav Acharya is the Executive Director
Finance and CFO. Five other Non-Executive Directors Mr Shirish Apte,
Mr Sanjay Labroo, Ms Meher Pudumjee,
Dr Valentin Von Massow and Ms Ramni Nirula are independent in terms of
Regulation 16 of the SEBI (Listing Obligations and Disclosure
Requirements) Regulations, 2015 (''Listing Regulations'') and Companies
Act, 2013. Two other Directors Mr B Hariharan and Dr Omkar Goswami
are Non-Executive Directors. The Directors are reputed professionals
with diverse functional expertise, industry experience, educational
qualifications, ethnicity and gender mix relevant to fulfilling the
Company''s objectives and strategic goals.
Mr Laurent Demortier resigned from his role as a CEO and Managing
Director of the Company with effect from 3 February 2016, thereafter,
he continued to serve as a Whole-time Director up to 31 March 2016.
Dr Colette Lewiner, Independent Director stepped down from her
directorship of the Company, with effect from 14 March 2016.
The Board places on record its gratitude and appreciation for Mr Demo
tier and Dr Lewiner for their guidance to the Company during their
tenure as Directors.
Mr K N Neelkant was appointed as the CEO and Managing Director with
effect from 3 February 2016.
Mr Madhav Acharya was appointed as Executive Director Finance with
effect from 1 April 2016, in addition to his role as the CFO of the
Ms Ramni Nirula was appointed on the Board as an Independent
Non-Executive Director with effect from 6 April 2016.
Retirement by Rotation
In terms of the provisions of Section 152 of the Companies Act, 2013
and the rules made there under and Article 114 of the Articles of
Association of the Company, Dr Omkar Goswami and Mr B Hariharan, retire
by rotation at the ensuing Annual General Meeting of the Company and
being eligible, have offered themselves for the re-appointment. The
profile details of Dr Omkar Goswami and Mr B Hariharan are contained in
the accompanying Notice of the forthcoming Annual General Meeting and
in the Corporate Governance Report. The Board recommends their
CG has signed a Share Purchase Agreement (SPA) for sale of its Power
businesses in Europe, North America and Indonesia.
Attributes, Qualification & Independence of Directors & their
The appointment and remuneration of Directors is governed by the
Remuneration Policy of the Company which also contains the criteria for
determining qualifications, positive attributes and independence of
Directors. The Policy along with the CG Board Diversity Policy aims at
attracting and retaining high caliber personnel from diverse
educational fields and with varied experience to serve on the Board for
guiding the Management team to enhance organizational performance. The
detailed Remuneration Policy is contained in the Corporate Governance
section of this Annual Report.
Independent Directors Declaration
All Independent Directors have submitted declarations that they
continue to meet the criteria of independence as laid down under
Section 149(6) of the Companies Act, 2013 and Regulation 16 of the
A calendar of meetings is prepared and circulated in advance to the
Directors. The Board of Directors met 6 times during FY2016. The
intervening gap between the meetings was within the period prescribed
under the Companies Act, 2013 and the Listing Regulations. The details
of the meetings and the attendance of the Directors are mentioned in
the Corporate Governance Report.
The Board has established Committees as a matter of good corporate
governance practice and as per the requirements of the Companies Act,
2013. The Committees are Risk and Audit Committee, Nomination and
Remuneration Committee, Corporate Social Responsibility Committee and
Stakeholders'' Relationship Committee. The composition, terms of
reference, number of meetings held and business transacted by the
Committees is given in the Corporate Governance Report.
Annual Board Evaluation
During the year, the Board has carried out the annual evaluation of its
own performance as well as the evaluation of the working of its
Committees and individual Directors, including Chairman of the Board.
This exercise was carried out through a structured questionnaire
prepared separately for Board, Committee and individual Directors. The
questionnaire for Board evaluation was prepared taking into
consideration various aspects of the Board''s functioning such as
adequacy of the composition and role of the Board, Board meeting and
reporting process, effectiveness of strategies, risk management
systems, external relationships, ethics and governance framework.
Committee performance was evaluated on the basis of its composition,
effectiveness in carrying out its mandate, relevance of its
recommendations and allocation of adequate time to fulfil its mandate.
Individual and peer assessment of Directors based on parameters such as
knowledge, contribution, level of engagement, communication /
relationship with Board and Senior Management were received by the
Chairman for individual feedback. The Board acknowledged certain key
improvement areas emerging through this exercise and action plans to
address these are in progress. The performance evaluation of the
Chairman was carried out by the Independent Directors. The Directors
expressed their satisfaction with the evaluation process and its
Familiarization of Independent Directors
The Company has in place the practice of familiarizing the Independent
Directors which inter-alia seeks to update the Directors, while their
induction, on their roles, responsibilities, rights and duties under
the Companies Act, 2013 and other statutes. This process helps the
Independent Directors to take well informed decisions in a timely
manner. The details of this program can be viewed under the following
link on company''s website: http://www.cgglobal.com/frontend/
KEY MANAGERIAL PERSONNEL
During the year under review Ms Minal Bhosale resigned from the
position of Company Secretary w.e.f. 31 May 2015. The Board of
Directors based on the recommendation of the Nomination and
Remuneration Committee, appointed Mr Manoj Koul as the new Company
Secretary of the Company w.e.f. 3 August 2015.
The Company is a part of the Avantha Group, one of India''s leading
diversified conglomerates. Led by Chairman Mr Gautam Thapar, the
Avantha Group has a global footprint and operates in 90 countries with
more than 25,000 employees worldwide.
As required under the Listing Regulations, CG periodically discloses
its promoter group and persons acting in concert in the shareholding
pattern and other filings with the Stock Exchanges.
As on 31 March 2016, the Company has three Indian subsidiaries and 31
foreign subsidiaries. The particulars are mentioned in Annexure 6 to
this Report in Form No. MGT 9 (Extract of Annual Return).
Pursuant to Section 136 of the Companies Act, 2013 the audited accounts
of each of the Company''s subsidiaries are placed on the website of the
Company and not enclosed in this Annual Report. If any Member of the
Company so desires, the Company will be happy to make available the
Annual Accounts of the subsidiaries to him / her, on request. The
physical copies of the aforesaid documents will also be available at
the Company''s Registered Office for inspection during normal business
hours on all working days, excluding Saturdays, up to the date of the
In terms of Section 129(3) of the Companies Act, 2013, statement
containing salient features of the financial statement of Subsidiaries
/ Associate companies / Joint Ventures is given in this Annual Report.
BRANCH OFFICE IN POLAND
The Company''s branch office in Poland i.e. Crompton Greaves Ltd SA is
under the process of liquidation.
ADOPTION OF IND AS
The Central Government in consultation with the National Advisory
Committee on Accounting Standards (NACAS) under Sectio 133 read with
Section 469 of the Companies Act, 2013 has notified the Indian
Accounting Standards (''Ind AS'') vide G.S.R. 111(E) dated 16 February
2015. The Company has decided for adoption of the aforesaid standards,
voluntarily, as stated in the Companies (Indian Accounting Standards)
Rules, 2015 with effect from 1 April 2015 and thereafter. The aforesaid
Rules have been further amended by the Companies (Indian Accounting
Standards) (Amendment) Rules, 2016 on 30 March 2016. In view of this
notification / amendment and also as per the Regulation 33 of Listing
Regulations, the Company has prepared the Financial Statements (both
stand-alone and consolidated) for the year ended 31 March 2016 as per
Ind AS, as amended.
RISK AND AUDIT COMMITTEE
As on the date of this Report, the Risk and Audit Committee is
comprised of three Non-Executive Directors, of whom two are
independent. The composition is as under:
- Mr Shirish Apte (Chairman, Independent Director)
- Dr Omkar Goswami (Non-Executive Director)
- Mr Sanjay Labroo (Independent Director)
All recommendations made by the Risk and Audit Committee during the
year were accepted by the Board of Directors.
RELATED PARTY TRANSACTIONS
The Company''s Related Party Policy governs the norms for inter-company
transaction pricing between the Company and its subsidiaries. Since the
Company has a network of wholly-owned subsidiaries, manufacturing, as
well as, engaged in sales of various products comprising the different
businesses of CG, a substantial quantum of related party transactions
comprise transactions with subsidiaries for purchase and sale of goods
and services, in the ordinary course of business.
An omnibus approval has been granted by the Risk and Audit Committee of
the Board for transactions which are of a foreseen and repetitive
nature with other related parties. Such omnibus approvals are
subjected to review by the Risk and Audit Committee every year and are
monitored by the Risk and Audit Committee on a quarterly basis. All
Related Party Transactions are presented to the Risk and Audit
Committee every quarter.
All related party transactions that were entered into during the
financial year were on an arm''s length basis and were in the ordinary
course of business. There are no material related party contracts,
arrangements or transactions undertaken by the Company during the year
in terms of its India Related Party Transaction Policy of the Company
and hence the disclosure of particulars of contracts / arrangements
entered into by the Company with related parties referred to in
sub-section (1) of Section 188 of the Companies Act, 2013 in Form AOC-2
(Annexure 1 to this Report) is nil.
The Company''s India Related Party Transactions Policy is uploaded on
the website of the Company and the we blink is as under:
PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS
Details of loans, guarantees given and investments made by the Company
during FY2016, pursuant to the provisions of Section 186 of the
Companies Act, 2013 and Schedule V of the Listing Regulations are given
in the notes to the Financial Statements.
BUSINESS RISK MANAGEMENT
A risk management policy has been developed and implemented by the
Company for identification of elements of risk, if any, which in the
opinion of the Board may threaten the existence of the Company. In
order to bring in more clarity on the objective, process and spell out
the roles and responsibilities for an effective implementation of the
Risk Management Process, the Board of Directors have adopted revised
Risk Management Framework. The revised framework enables risk
identification and its escalation and consolidation at unit level to
business unit level, identification of risk mitigation process.
In terms of the framework, the Risk and Audit Committee shall review
the adequacy of the risk management framework of the Company, the key
risks associated with the businesses of the Company and the measures
and steps in place to mitigate the same, from time to time. The
assessment of the risks covers Strategy, Technology, Financial,
Operations & Systems, Legal & Regulatory and Human Resources Risks.
There is appropriate assurance and monitoring mechanism in place to
monitor the effectiveness of the risk management framework including
the mitigation plans identified by the Management for key risks
identified through the risk management exercise.
INTERNAL FINANCIAL CONTROLS
CG has in place, adequate systems and procedures for implementation of
internal financial control across the organization which enables the
Company to ensure that these controls are operating effectively.
RESEARCH AND DEVELOPMENT
During the year, the Company''s R&D activities continued to focus on
development of improved energy efficient and reliable products. Power
transformers focused on research in cost competitiveness, oil tightness
and validation of hot spot calculation. Research was also carried out
in GAI3S 245 kV GIS with spring drive, 170 kV mobile GIS, 420 kV CT
with Casting Tank, Composite Insulator CVTS, digital interface (digital
surge counter) to the lightning arrester for condition monitoring of
products, which is a vital communication link for smart substations and
study of external withstand and flashover characteristics of air
insulations for development of new and niche products. Other areas of
research in power products included Inverter Duty 12 Pulse Transformer
3.2 MVA with foil winding,
Four Inverter Feed 4.25 MVA Transformer with foil winding and 2X12
Pulse Four Winding Transformers for solar application.
Automation business R&D activities, led by the R&D Centre of
Excellence, together with the R&D teams at different locations, are
mainly focused on new products and features to maintain its
technological leadership in Protections and Control as well as in
metering and communications.
Industrial systems business focused on control platform, new DSP
technology for high performance DTC, SVPWN and FOC for AM, PMSM and
SynRM and new UC technology for integrated connectivity and
communication. CSA certified single phase motors up to 5HP 4P and 6P
were developed. In Railways Signalling Division, R&D activity was
carried out to design and develop two key products for railway and one
customized product for Honda Motors such as 110Volts AC Fan with
specially designed SS guard having better aesthetics to suit advanced
interior of EMUs., 230 Volts AC BLDC Fan with special feature of speed
regulation having customized design for Honda Motors and 380 Volts AC 3
Phase Point Machine for Metro rail.
The above R&D efforts would result in extended product range, increase
in operating income and expansion in new markets.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE
EARNINGS AND OUTGO
As required by the Companies Act, 2013, read with the Companies
(Accounts) Rules, 2014, the relevant data pertaining to conservation of
energy, technology absorption and foreign exchange earnings and outgo
is given in the prescribed format as Annexure 2 to this Report
ENVIRONMENT, HEALTH & SAFETY (EHS)
By and large, EHS Management system, programs and policies were
enhanced and overhauled during the year. All CG manufacturing units in
Asia, EMEA and Americas have maintained their ISO14001 and OSHAS18001
CG''s EHS policy and guidelines are a reflection of CG''s strong EHS
commitment. The EHS Guidelines prescribe responsibilities
and accountabilities of individual functions and the standards for
adherence with the Guidelines. Behaviour Based Championship Model was
introduced, resulting in increased overall EHS awareness. Additionally,
bi- monthly regional EHS network conference calls were conducted for
cross business and cross regional EHS knowledge sharing.
Smart EHS goals now form a part of KPI''s of individual leaders. Monthly
online EHS Balanced Score Card concept was introduced under which all
units set their annual targets towards EHS KPI''s and individual unit''s
EHS performance against the set targets were evaluated. Corporate EHS
audit process was revamped with the inclusion of skip level meeting and
interview process. These audits were more focused on EHS
implementation and performance, rather than EHS documentation, as a
journey towards continuous improvement in EHS excellence. Corrective
actions generated from these audits and various EHS events are captured
and tracked for closure in Online Event Reporting System portal (ERS)
as EHS one stop shop.
With the objective of rewarding individual and collective efforts
towards EHS, EHS RECOGNIZE policy was introduced and aligned with
organisational RECOGNIZE drive. Two units were awarded as Best EHS unit
CEO annual award.
CORPORATE SOCIAL RESPONSIBILITY (CSR)
The Company''s undeterred commitment towards CSR initiatives endeavor to
embrace responsibility for its corporate actions and achieve fruitful
impact of its business actions not only on its stakeholders, but also
the society at large. As part of its CSR initiatives, CG has undertaken
projects in the areas of education, employability and health. CG
supports Avantha Foundation on programs such as reduction of
Malnutrition and Hunger and building capacities of stakeholders in
small towns to ensure better delivery of services to citizens. The
Annual Report on CSR activities of CG for FY2016 is stated at Annexure
3 to this Report.
Electronic copies of the Annual Report and Notice of the 79th Annual
General Meeting are sent to all members whose email addresses are
registered with the Company / Depository Participant(s) for
communication purposes. For members who have not registered their
email addresses, physical copies of the Notice and Annual Report are
sent in the permitted mode. Members requiring physical copies can send
a request to the Company. The physical copies of the aforesaid
documents will also be available at the Company''s Registered Office for
inspection during normal business hours on all working days, excluding
Saturdays, up to the date of the Meeting.
MATERIAL CHANGES AND COMMITMENT AFFECTING FINANCIAL POSITION OF THE
There are no material changes and commitments affecting the financial
position of the Company which has occurred between the end of the
financial year of the Company i.e., 31 March 2016 and the date of this
MATERIAL ORDERS OF REGULATORS / COURTS / TRIBUNALS
No significant or material orders were passed by the Regulators or
Courts or Tribunals which impact the going concern status and Company''s
operations in future.
DIRECTORS'' RESPONSIBILITY STATEMENT
The Directors would like to assure the Members that the financial
statements for the year under review conform in their entirety to the
requirements of the Companies Act, 2013. The Directors confirm that:
- the Annual Accounts have been prepared in conformity with the
applicable Accounting Standards;
- the Accounting Policies selected and applied on a consistent basis,
give a true and fair view of the affairs of the Company and of the
profit for the financial year;
- sufficient care has been taken that adequate accounting records have
been maintained for safeguarding the assets of the Company; and for
prevention and detection of fraud and other irregularities;
- the Annual Accounts have been prepared on a going concern basis;
- the internal financial controls laid down in the Company were
adequate and operating effectively;
- the systems devised to ensure compliance with the provisions of all
applicable laws were adequate and operating effectively.
SHARE REGISTRAR & TRANSFER AGENT
The Company''s Registrar & Transfer Agents for shares is Datamatics
Financial Services Ltd (DFSL). DFSL is a SEBI- registered Registrar &
Transfer Agent. The contact details of DFSL are mentioned in the
Corporate Governance Report.
investors are requested to address their queries, if any to DFSL;
however, in case of difficulties, as always, they are welcome to
contact the Company''s Investor Services Department, the contact
particulars of which are contained in the Corporate Governance Report.
The Company has not accepted any deposits from public or its members
during FY2016 under Section 73 of the Companies Act, 2013 and no
deposits are subsisting as on date.
PARTICULARS OF EMPLOYEES
In terms of the provisions of Section 197(12) of the Companies Act,
2013 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 forms part of this
Report. However regard to the provisions of the first proviso to
Section 136(1) of the Companies Act, 2013, the Annual Report excluding
the aforesaid information is being sent to the members of the Company.
The said information is 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 Secretary and the
same will be furnished on request. Disclosures pertaining to
remuneration and other details 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, is given at
Annexure 4 to this report.
COMPLAINTS RELATING TO SEXUAL HARASSMENT
In terms of the Sexual Harassment of Women at Workplace (Prevention,
Prohibition and Redressal) Act and Rules, 2013, it is mandatory to
review status of sexual harassment related complaints in the Annual
Report. There were no incidents of sexual harassment reported in the
Company. For protection against sexual harassment, CG has formed an
internal complaints committee to which employees can write in their
complaints. The Company has a Prevention of Sexual Harassment Policy
which has formalised a free and fair enquiry process for dealing with
such issues, with clear timelines. During FY2016, a number of workshops
and programs were conducted by the Company to spread awareness on
sexual harassment related issues.
The Company has formulated CG Whistle Blower Policy with a view to
providing a mechanism for CG employees to report violations and assure
them of the process that will be followed to address the reported
violation. The Policy also lays down the procedures to be followed by
Senior Management for tracking of complaints,
giving feedback, conducting investigations and taking disciplinary
actions. It also provides assurances and guidelines on confidentiality
of the reporting process and protection from reprisal to complainants.
A Management Committee as nominated by CEO and Managing Director is
formed upon completion of the investigation and requiring action by the
Committee. Decisions taken by the Management Committee and actions
taken by the Company or exoneration cases are informed by the Head of
Internal Audit to the Risk and Audit Committee on a quarterly basis.
Actions taken by the Management Committee are implemented subject to
AUDITORS STATUTORY AUDITORS
In view of the mandatory rotation of auditor requirement and to ensure
smooth transition, it is proposed to appoint M/s Chaturvedi & Shah as
Joint Statutory Auditors along with M/s Sharp & Tannan, the existing
Statutory Auditors of the Company. Both the Auditors will be jointly
and severally responsible during FY2017.
M/s Chaturvedi & Shah are proposed to be appointed for a period of 5
continuous years i.e. from the conclusion of 79th Annual General
Meeting till the conclusion of 84th Annual General Meeting of the
Company. M/s Sharp & Tannan and M/s Chaturvedi & Shah, have informed
the Company vide letters both dated 24 May 2016 respectively that their
appointment, if made, would be within the limits prescribed under
Section 141 of the Companies Act, 2013. M/s Sharp & Tannan and M/s
Chaturvedi & Shah, have confirmed that they have subjected themselves
to the peer review process of the Institute of Chartered Accountants of
India (ICAI) and hold valid certificates issued by the Peer Review
Board of the ICAI. M/s Sharp & Tannan and M/s Chaturvedi & Shah, have
also furnished a declaration confirming their independence as well as
their arm''s length relationship with the Company and declared that they
have not taken up any prohibited non-audit assignments for the Company.
The Company had appointed M/s Ashwin Solanki & Associates, Cost
Accountants, to audit the cost accounts related to the Company''s
products for 2015 2016. The cost audit reports were filed within the
Upon recommendation of the Risk & Audit Committee, the Board had
appointed M/s Ashwin Solanki & Associates as Cost Auditors, for the
financial year 2016-2017. At the ensuing Annual General Meeting, their
remuneration is proposed to be approved and ratified by the
The Company has appointed Dr K R Chandratre, Practising Company
Secretary to undertake the Secretarial Audit of the Company. The Report
of the Secretarial Audit for FY2016 is annexed herewith as Annexure 5
to this Report.
There are no qualifications, reservations or adverse remarks or
disclaimers made by the Statutory Auditor or the Secretarial Auditor in
their reports and hence do not call for any further comments.
During the year under review, neither the Statutory Auditor nor the
Secretarial Auditor had reported any matter under Section 143(12) of
the Companies Act, 2013, therefore no details are required to be
disclosed under Section 134(3)(d) of the Companies Act, 2013.
EXTRACT OF ANNUAL RETURN
The details forming part of the extract of the Annual Return in Form
MGT 9 is annexed herewith as Annexure 6.
The Directors wish to convey their gratitude and appreciation to all of
the Company''s employees at all its locations worldwide for their
tremendous efforts as well as their collective dedication and
contribution to the Company''s performance.
The Directors would also like to thank the employee unions,
shareholders, customers, dealers, suppliers, bankers, government and
all other business associates for their continued support extended to
the Company and the Management.
On behalf of the Board of Directors
Mumbai, 27 May 2016