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GOCL Corporation

BSE: 506480|NSE: GOCLCORP|ISIN: INE077F01035|SECTOR: Chemicals
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Directors Report Year End : Mar '18    Mar 17

REPORT OF THE BOARD OF DIRECTORS TO SHAREHOLDERS

To the Members

of GOCL Corporation Limited

Your Directors have pleasure in presenting their Fifty Seventh Annual Report and Audited Accounts for the year ended March 31, 2018. There were no material changes and commitments affecting the financial position of the Company which have occurred between the end of the financial year of the Company to which these financial statements relate and the date of this Report.

1. FINANCIAL RESULTS;

Consolidated

Standalone

2017-18 Rs, Lakhs

2016-17 Rs, Lakhs

2017-18 Rs, Lakhs

2016-17 Rs, Lakhs

Profit after providing for Depreciation and before exceptional items and taxation

4374.18

4026.68

2454.52

2064.23

Exceptional Items

402.23

714.85

407.65

714.85

Profit Before Taxation

4776.41

4741.53

2862.17

2779.08

Taxation:

Current Tax - Current Year Deferred

1332.32

101.38

1231.89

244.12

477.89

162.64

385.00

285.55

Profit After Taxation

3342.71

3265.52

2221.64

2108.53

Other Comprehensive Income

27863.90

15936.06

27.58

(16.54)

Total Comprehensive Income for the year

31206.61

19201.58

2249.22

2091.99

Appropriations:

Interim Dividend Proposed Dividend

793.16

793.16

793.16

793.16

Transfer to General Reserve

-

-

-

-

Balance carried to Balance Sheet

30413.45

18408.42

1456.06

1298.83

EPS (of Rs,. 2/- each)

6.74

6.59

4.48

4.25

Consolidated Financial Statements

The Consolidated Financial Statements of the Company prepared in accordance with relevant Accounting Standards issued by the Institute of Chartered Accountants of India form part of this Annual Report. These statements have been prepared on the basis of audited financial statements received from the subsidiary companies as approved by their respective Board of Directors. There is no change in the nature of bussiness of the Company or the subsidiaries.

2. DIVIDEND

The Board had on March 23, 2018 declared an interim dividend of Rs, 1.60 per equity share of face value of Rs, 2 each @ 80% (final dividend of 80% for previous year), the Record Date for which was April 6, 2018 and the same was accordingly paid to the Shareholders on April 12, 2018 out of the profits of the Company for the current year. The Board has decided to treat the Interim Dividend as the Final Dividend and hence not recommended any additional dividend for the year. The Interim Dividend, excluding dividend distribution tax, aggregated to Rs, 793.16 crores (previous year Rs, 793.16 crores).

3. CREDIT RATING

Infomerics Valuation and Rating Private Limited (IVR) has assigned long term rating of IVR A- with Stable Outlook and short term rating of IVR A2 for the Company; and ICRA has assigned [ICRA] BBB and short term rating of [ICRA] A3 , respectively for its wholly owned subsidiary IDL Explosives Ltd. In view of the improvement in operations, funds flow and decrease in debt, the ratings have improved for both the Company and its subsidiary IDLEL.

4. OPERATIONS Standalone:

The net revenue of the Company was Rs, 121 crores (previous year Rs, 130 crores). The profit before exceptional items and taxation was Rs, 24.55 crores (Rs, 20.64 crores). The profit before tax was Rs, 28.62 crores (Rs, 27.79 crores). The profit after provision for current tax of Rs, 4.78 crores and deferred tax of Rs, 1.63 crores was Rs, 22.22 crores (Rs, 21.09 crores) resulting in an EPS of Rs, 4.48 for the year (Rs, 4.25).

The turnover and profits were affected due to the Mining & Infrastructure Division having reduced operations in line with the non-operation of mines in the metal sector.

Consolidated:

On a consolidated basis, the net revenue of the Company was Rs, 551 crores (Rs, 577 crores). Profit After Tax was marginally higher at Rs, 33.43 crores (Rs, 32.66 crores) and EPS of Rs, 6.74 (Rs, 6.59).

The wholly owned subsidiary, IDL Explosives Limited (IDLEL) achieved a net revenue of Rs 416 crores (Rs, 422 crores). Profit Before Tax was Rs, 21.53 crores (Rs, 20.57 crores). Profit After Tax was Rs 13.88 crores (Rs,12.93 crores).

The drop in turnover and profit was due to drop in market prices of explosives and accessories by over 8% and 25% respectively and transition to GST affecting sales activity by a fortnight.

5. DIVISIONAL PERFORMANCE

5.1 Business Operations

5.2 Energetics

The net revenue of the Division was marginally lower at Rs, 90.75 crores as against Rs, 92.72 crores in the previous year, in spite of tough market conditions. Detonator sales were mainly affected due to shift in retail sector demand from plain detonators and electric detonators to non-electric detonators and cords.

The shift in demand pattern also affected the prices of our product mix by nearly 25% on an average. However, the challenge was met by increasing volumes across all emerging demand segments. Non-electric detonators were increased by around 56% whilst cartridge explosives by nearly 15%. Electronic detonators and pentolite boosters volumes were doubled.

Special Products Group was able to make higher supplies after qualifying for various pyro devices for the missile programmes of Bharat Dynamics Limited and DRDL. The sales income of the Group increased by 81% over the previous year.

Export volumes contributed to the overall turnover and contribution, and added new customers located in new regions.

R&D activities were increased to cover new product and process development to cater to specific market requirements and improve product attributes. Expenditure of Rs, 1.73 crores was incurred during the year.

5.3 Mining and Infrastructure

The operations of the Division continued to be curtailed due to clients not receiving mining approval from respective State Governments under the MMRDA Act. In the latter part of the year, some mines started reopening at a slow pace.

The Division did a limited turnover of Rs, 1.39 crores as against Rs, 6.57 crores of previous year. In view of the paucity of business, further equipment which were idle or had become inefficient were disposed off during the year.

5.4 Bulk and Cartridge Explosives

Bulk and Cartridge explosives are manufactured by IDL Explosives Ltd., a wholly owned subsidiary. Several initiatives taken during the year have resulted in benefits in this year itself. The Ammonium Nitrate storage capacities at locations were increased from 2500 MT to 7000 MT helping higher throughputs at all plants. The Rourkela plant achieved capacity utilisation of 102% whilst the average capacity utilisation of the Bulk plants was around 80%. Two new bulk plants with capacities of 10000 T in West Bengal and 6000 T in Chhattisgarh were added which achieved capacity utilisation of 78% and 61% respectively during the year.

At Rourkela, the increase in throughput was also helped by the continuous processing plant coming into operation for packaged explosives. This has been a major in-house project which has not only reduced manufacturing costs but also improved the consistency of the products related to the batch processes operated earlier. The bulk explosives volumes increased to 99,000 tonnes was supported by new bulk delivery pump truck being introduced and several older vehicles having been replaced.

5.5 Exports

Export activities increased during the year but due to paucity of vessels at Chennai several shipments could not be made by the end of the year. However, exports recorded for the year was at Rs, 35.28 crores ( Rs, 37.45 crores ).

5.6 Property Development Bengaluru :

Construction of Block 3 (2 Basements Ground 10 upper Floors) and MLCP (multi-level car park) in the “Ecopolis” project is completed and Occupation Certificate received. It has potential of approx. over 7.6 lakh sqft of leasable area and 2500 car parks. Block 3 is a certified LEED Gold rated building and is ready for fit-outs with occupancy certificate.

Block 2 is in the final stages of completion, and would be ready for clients fit-out works by Q3 of 2018. Block 2 (2 Basements Ground 10 upper Floors), has potential of approx. over 7.3 lakh sqft of leasable area and pre-certified LEED Gold rated building.

Plans for development of the balance land is under finalization considering some serious interest from large organizations for built to suit requirements in the SEZ block.

The first block in the Ecopolis project at Bengaluru, i.e., Block 3 and the Multi-Level Car Parking (MLCP) have been ready for some time. The first Lease Agreement for 10 years (extendable to another 5 years ) has been signed with one of the major leading multi-national insurance/financial companies, for one full floor ( 73,465 sft ) in Block 3. The revenue stream will start after the fit out period from Q3 of the current year.

Our Developer, Hinduja Realty Ventures Limited, for “Ecopolis” has been awarded the prestigious CIDC ( Construction Industry Development Council) Vishwakarma Awards 2018 in the category of “Best Construction Projects” for engagement of new / innovative techniques, deployment of Green Technologies, Health, Safety & Environment measures adopted, engagement of quality manpower, engineering, management, skilled construction worker etc.

Hyderabad

The city’s strong office leasing activity in the recent past has had positive impact on the residential market. This coupled with robust infrastructural development, supportive government policies and competitive pricing has positioned Telangana''s capital Hyderabad as one of the most affordable residential markets for buyers.

The 100 acre integrated mixed use township is located in Kukatpally which is easily accessible to all the hotspots of the city. This township comprises of IT/ITeS office space, Retail segment, Educational Institution, Hotel, Hospital and Residential apartments.

The master plan has been redesigned and a detailed design for Phase 1 of the development is currently being developed. In the meantime, approval from the Airport Authorities has been received.

6. OVERSEAS HOLDING

The Company through its UK based subsidiary HGHL Holdings Limited, UK (HGHL) holds 10% stake in Houghton International Inc., USA a subsidiary of the Hinduja Group''s Gulf Oil International. Further, repayments of the loan instalments are being regularly made. The outstanding as on March 31, 2018 was USD 88.20 million.

Houghton International has, in the month of April 2017 entered into a definitive agreement to merge with Quaker Chemical (NYSE: KWR) to create a global leader in the space of process fluids, chemical specialties, and technical expertise to the global primary metals and metal working industries. The Hinduja conglomerate will be the largest shareholder in the combined public company. On completion of the merger, your Company will be entitled to approx. 2% in the combined entity.

Quaker Chemical is reported to have already received regulatory approvals from two of the countries in which it operates. Depending on the receipt of the remaining regulatory approvals including from the USA and Europe, as well as other customary terms and conditions set forth in the share purchase agreement, closing of the Combination is expected to occur in the next few months.

Your Company continues to receive commission towards providing security of its property for the loan availed by its wholly owned subsidiary in the UK for the aforesaid acquisition.

7. PROMOTER OF THE COMPANY

Hinduja Power Limited, Mauritius (HPL) continued to reinforce their confidence in the long term prospects of your Company by increasing their shareholding to 74.93%.

8. PUBLIC DEPOSITS

The Company has during the earlier financial year repaid / prepaid all the public deposits and there were no outstanding public deposits at the beginning of the year under review. The Company has not accepted any public deposits during the year. The Board of Directors of the Company may consider accepting fresh public deposits at the appropriate time, as per the regulatory changes under the Companies Act 2013.

9. TAXATION

Goods & Services Tax ( GST )

The GST implementation w.e.f. July 1, 2017 was a game changer triggering a major change in the method of doing business especially for interstate transactions. The Company was, therefore, able to resolve several distribution issues involving interstate supplies to its major customers.

Your Company along with its subsidiaries have been able to implement satisfactorily at all plants and sales locations the GST system with numerous amendments and the E-way Bill system for smooth operations using the SAP backbone.

Odisha Sales Tax

The Sales Tax cases pertain to branch transfer of finished goods from Rourkela factory (since transferred to IDL Explosives Limited as part of the Demerger) situated in the State of Odisha to Coal India Limited subsidiaries in other States.

Writ Petitions for assessment years 1976-77 to 1983-84 were filed in March, 2013 in the Odisha High Court against the order of the Commissioner of Commercial Taxes. The High Court of Odisha has granted stay on the tax re-computation order and the order of Commissioner of Commercial Taxes. The Writ Petitions are pending.

I n respect of other assessment years 1998-99, 2002-03, 2004-05 and 2005-06 the petitions are pending before the Odisha Sales Tax Tribunal and Odisha High Court.

10. SUBSIDIARIES:

The Company has four subsidiaries, of which, only one is a material one, namely IDL Explosives Limited. The UK subsidiary is an SPV incorporated for the purpose of overseas acquisition of Houghton. The remaining two subsidiaries do not, at present, undertake any significant business activity. The annual performance of the subsidiaries is as under:

- HGHL Holdings Limited, UK reported a net profit of '' 565.99 lakhs ('' 248.72 lakhs).

- IDL Explosives Limited reported a net profit of '' 1388.05 lakhs ('' 1293.43 lakhs).

- IDL Buildware Limited reported a net profit of '' 5.25 lakhs ('' 13.82 lakhs ).

- Gulf Carosserie India Limited incurred a loss of '' 0.30 lakhs ( Loss '' 0.58 lakhs).

In accordance with section 136 of the Companies Act, 2013, the Audited Financial Statements including Consolidated Financial Statements and related information of the Company and Audited accounts of the each of its subsidiaries are available on our website www.goclcorp.com. These documents will also be available for inspection till the date of AGM during working hours at our Registered Office. A statement containing salient features of the financial statement of the above subsidiaries are disclosed in Form AOC - 1 as ‘Annexure-A'' to this Report.

A Scheme of Arrangement has been proposed during the year for amalgamation of two of the wholly owned subsidiaries, namely, IDL Buildware Limited and Gulf Carosserie India Limited. Pursuant to the directions of the Hon''ble National Company Law Tribunal (NCLT), Hyderabad Bench, the Scheme of Arrangement has been approved with requisite majority of the Shareholders and the Creditors. The Scheme is presently under the consideration of the Hon''ble NCLT.

11. HUMAN RESOURCES / INDUSTRIAL RELATIONS:

The Human Resources Department and Industrial Relations Department at the factories continued to maintain high levels of commitment and motivation amongst the employees resulting in higher productivity and value addition at all locations.

The Company continued to lay a strong emphasis on Safety and in this regard programs on Hazard Identification and Risk Assessment (HIRA) and Job Safety Analysis (JSA) were conducted along with training programs at Hyderabad and Rourkela on the New IMS Standards for ISO 9001, 14001 and 18001. Intensive Training Programs on GST was provided to key personnel for effective implementation of GST in the Company within the timeframe announced by the State Governments.

Recognition of employees for outstanding monthly performance and achievement of efficiency with compliance to Safety Standards was continued.

Safety

New Initiatives for Safety improvement include up gradation to the new IMS 2015 standards and recertification of ISO 9001:2015; ISO 14001:2015 & BS OHSAS 18001:2007. During the year, systems in the magazines to reduce the manual handling of explosive boxes and daily safety walkthrough inspections with cross functional teams and reporting through daily EHS inspection reports were maintained. Refresher training programs for all the employees; specialized medical tests for workmen for enhancing occupational health &safety. Third party safety audit was conducted to strengthen the manufacturing systems. .

National Safety Month programs conducted for further building up the of safety awareness of the employees. Inter Plant like Safety Slogans, Quiz, Essay writings, drawings and Paper presentations were organized to spread the safety awareness messages.

Preventive Health Check-ups

Specialized medical check-ups on occupational health was conducted for all the employees who are involved in hazardous process operations to identify occupational health issues, if any.

Security

Security measures have been enhanced at all factories of the Company and its subsidiary IDLEL. Additional security gates and speed breakers were constructed on both sides of all access gates to control speedy movement of vehicles. Records of all visitors to the plant in terms of the requirement of the Ministry of Home Affairs are being maintained. Walkie talkie sets were deployed for faster communication within the factory premises and monthly security training was organized for the security.

Employment Practices

The Company believes in fair employment practices and is committed to provide an environment that ensures that every employee is treated with dignity and respect and is provided equitable treatment. The Company has a large proportion of women in the workforce and has adopted a Policy in line with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the Rules there under. Internal Complaints Committee (ICC) has been set up to redress complaints received regarding sexual harassment. All employees are covered under this policy. No complaint was received in this regard, during the year.

12. DIRECTORS'' RESPONSIBILITY STATEMENT

To the best of their knowledge and belief and according to the information and explanations obtained by them, your Directors make the following statements in terms of Section 134 of the Companies Act 2013:

(a) that in the preparation of the annual accounts/financial statements for the financial year ended March 31, 2016, the applicable accounting standards had been followed along with proper explanation relating to material departures, if any;

(b) that the accounting policies as mentioned in the financial statements were selected and applied consistently and reasonable and prudent judgments and estimates were made 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 and loss of the company for that period;

(c) that proper and sufficient care had been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act 2013 for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities;

(d) that the annual accounts were prepared on a going concern basis;

(e) that proper internal financial controls were in place and that such internal financial controls are adequate and were operating effectively; and

(f) that proper systems to ensure compliance with the provisions of all applicable laws were in place and that such systems were adequate and operating effectively.

13. AUDITORS

Statutory / Financial Audit

M/s BSR & Associates LLP, Chartered Accountants, (ICAI Firm Registration Number: 116231W/ W-100024) were appointed as Auditors of the Company for a period of five years from conclusion of the 56th Annual General Meeting subject to ratification by the members at every AGM. However, the Companies (Amendment) Act, 2017 has done away with the requirement of annual ratification of appointment of Auditors. Hence, ratification of auditors appointment is not being proposed at the ensuing AGM. Accordingly, as approved at the 56th AGM, the term of M/s BSR & Associates LLP, will be upto the conclusion of 61st AGM of the Company.

Cost Audit

The Ministry of Corporate Affairs had, vide its Order dated December 31, 2014 directed audit of cost records of the companies covered under the Companies (Cost Records & Audit) Amendment Rules, 2014. The said Order is applicable to the Company, being manufacturer of Detonators, Detonating Fuse, Explosives, etc. Accordingly, the Board of Directors has appointed M/s Narasimha Murthy & Co., Cost Accountants, Hyderabad as the Cost Auditors of the Company for the financial year 2017-18.

Secretarial Audit

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Board has appointed M/s BS & Company Company Secretaries LLP, Company Secretaries, Hyderabad to undertake the Secretarial Audit of the Company for the financial year 2017-18. The Report of the Secretarial Audit Report is annexed herewith as ‘Annexure D''.

There was no qualification, reservation or adverse remark or disclaimer in the auditor’s report, cost audit report or the secretarial audit report. The Auditors have not reported any frauds.

14. CORPORATE SOCIAL RESPONSIBILITY (CSR) INITIATIVES

The CSR Committee recommended CSR expenditure of '' 38.02 lakhs for the year 2017-18. Accordingly, two projects in the Education and Rural Development were identified and work orders released. The Annual Report on CSR activities is annexed herewith as ‘Annexure E''.

In the first project, as part of the Sustainable Rural Development program, we have undertaken an Innovative Digital Education Initiative. We have provided interactive smart boards and projectors for imparting teaching in an audio-visual form, in 5 zillaparishad and residential schools in Palghar District of Maharashtra. The course content for the particular class and selected subjects (PCM and Social Sciences) will be delivered in audio-visual form.

I n the second project, a major renovation was carried out in a 72 year old School in Tandur, Telangana. The project involved major renovations in the school premises including repair of walls and roofing. Thereafter, a school library and a Science Laboratory were created. Computer Room with audio visual facilities has been set up to teach and train students for getting them ready for the digital world. Since, the work involved was dependent on several contractors and suppliers the work completed in the first two months of the current year.

15. VIGIL MECHANISM / WHISTLE BLOWER POLICY

In terms of the requirements of the Companies Act 2013 and Regulation 22 of Listing Regulations, the Company has a vigil mechanism to deal with instance of fraud and mismanagement, if any. The details of the vigil mechanism are displayed on the website of the Company. The Audit Committee reviews the functioning of the vigil / whistle blower mechanism from time to time. There were no allegations / disclosures / concerns received during the year under review in terms of the vigil mechanism established by the Company.

16. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

Particulars of loans, guarantees, securities and investments made by the Company, most of which are to its wholly owned subsidiaries, are in the notes to the financial statements forming part of this report.

The Company has during the year invested an amount of '' 19,05,75,000 for subscribing to '' 18,15,000 equity shares of IDL Explosives Limited (IDLEL), at a premium of '' 95 per equity share. IDLEL has subsequently redeemed 1,89,000 preference shares held by the Company, at a premium of '' 900 per share of face value of '' 100 each. An amount of '' 40,010 was further invested for acquiring 20,005 equity shares of Gulf Carosserie India Limited, making it a wholly owned subsidiary.

17. INVESTOR EDUCATION AND PROTECTION FUND

During the year under review, your Company transferred unclaimed dividend amount (pertaining to dividend for 2009-10) and unclaimed refund amount (application amounts for rights issue of 2010) to the Investor Education and Protection Fund in compliance with the applicable provisions of the Companies Act 2013. Your Company also transferred an aggregate of 2,45,579 shares to the IEPF Authority, in respect of which dividend had remained unclaimed for a consecutive period of 7 years.

18. DIRECTORS AND KEY MANAGERIAL PERSONNEL (KMP)

During the year there was no change in composition of Board of Directors and KMPs of the Company.

In accordance with the provisions of the Companies Act 2013 and the Articles of Association of the Company Mr. Ajay P. Hinduja retires by rotation at the 57th Annual General Meeting of the Company and is eligible for reappointment. Mr. Ramkrishan P Hinduja and Mr. Ajay P Hinduja are related to each other. The Board recommends his re-appointment.

The number and details of the meetings of the Board and other Committees are furnished in the Corporate Governance Report.

The Independent Directors have furnished declaration of independence under Section 149 of the Companies Act 2013 and Regulation 25 of SEBI (LODR) Regulations, 2015.

Detailed report on the evaluation of the Board, its Committees and the individual directors forms part of the Corporate Governance Report.

Directors'' Appointment and Remuneration Policy

The Nomination and Remuneration Committee is responsible for developing competency requirements for the Board based on the industry and strategy of the Company and formulates the criteria for determining qualifications, positive attributes and independence of Directors in terms of provisions of Section 178 (3) of the Act and the Listing Regulations. The Board has in an earlier year, on the recommendations of the Nomination &Remuneration Committee framed a policy for remuneration of the Directors and Key Managerial Personnel. The objective of the Company''s remuneration policy is to attract, motivate and retain qualified and expert individuals that the company needs in order to achieve its strategic and operational objectives, whilst acknowledging the societal context around remuneration and recognizing the interests of Company''s stakeholders.

The Non-Executive Directors (NED) are remunerated by way of Sitting Fee for each meeting attended by them and an annual commission on the profits of the Company. Commission to respective non-executive directors is determined on the basis of an objective criteria discussed and agreed upon by the Committee Members unanimously. NEDs are reimbursed any out of pocket expenses incurred by them in connection with the attendance of the Company''s Meetings.

Particulars of Employees and Remuneration

Pursuant to section 197(12) of the Companies Act, 2013 read with Rules 5(1), 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are provided in the separate as ‘Annexure B'' forming part of the Board''s Report. Having regard to the provisions of Section 136(1), 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 without any fee and free of cost.

19. ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The information on conservation of energy, technology absorption and foreign exchange earnings and outgo stipulated under Section 134(3)(m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014, is annexed herewith as ‘Annexure C''.

20. INFORMATION ON STOCK EXCHANGES

The Equity shares of the Company are listed on BSE Limited and the National Stock Exchange of India Limited and the Listing Fees have been paid to them up-to-date.

21. CORPORATE GOVERNANCE

A detailed report on the subject forms part of this report. The Statutory Auditors of the Company have examined the Company’s compliance and have certified the same as required under the SEBI Guidelines. Such certificate is reproduced in this Annual Report.

22. RELATED PARTY TRANSACTIONS

All related party transactions / arrangements that were entered into during the financial year were at an arm’s length basis and were in the ordinary course of business. During the year under review, there were no materially significant related party transactions made by the Company with Promoters, Directors, Key Managerial Personnel which may have a potential conflict with the interest of the Company at large.

All related party transactions / arrangements, mostly with the wholly owned subsidiaries, are at arm''s length basis and are in the ordinary course of business. The Audit Committee/Board reviews all the related party transactions on annual basis. The policy on Related Party Transactions as approved by the Board is displayed on the Company''s website.

None of the Directors has any pecuniary relationships or

transactions vis-a-vis the Company. Details of the transactions with Related Parties are provided in the accompanying financial statements.

23. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS

During the year under review, there were no significant material orders passed by the Regulators / Courts which would impact the going concern status of the Company and its future operations.

Pursuant to a complaint filed before the Competition Commission of India (CCI) by Coal India Limited, CCI had vide their Order dated April 16, 2012 held that the Company had, along with a few other explosive manufacturers, were alleged to have contravened the provisions of Section 3 of the Competition Act 2002. The CCI had on that basis imposed a penalty on the Company of Rs, 29.84 crores. The Company had filed an Appeal before the Competition Appellate Tribunal (COMPAT) and the COMPAT had vide its Order dated April 18, 2013, reduced to Rs, 2.89 crores; and a further Civil Appeal in the Supreme Court of India and the matter is subjudice. Based on expert legal advice, the Company believes that it has a good case and expects a favourable decision in the matter.

24. EXTRACT OF ANNUAL RETURN

The details forming part of the extract of the Annual Return in form MGT-9 is annexed herewith as ‘Annexure F''.

25. RISK MANAGEMENT

Details of development and implementation of risk management policy for the Company including identification therein of elements of risks form part of the Management Discussion and Analysis and the Corporate Governance Report.

ACKNOWLEDGEMENTS

Your Directors would like to express and place on record their sincere appreciation for the continued co-operation and support received from the financial institutions, banks, Government of India and various State Government authorities and agencies, customers, vendors and members during the year under review. Your Directors also place on record their deep appreciation for their continued dedication, commitment, hard work and significant contributions to the Company in very competitive market conditions which prevailed in the year under review. The Directors also thank the Company''s investors, business associates, for their continued co-operation and support.

for and on behalf of the Board of Directors

Place : Mumbai Ajay P. Hinduja

Date : August 10, 2018 Chairman

Source : Dion Global Solutions Limited
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