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Omkar Speciality Chemicals

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Directors Report Year End : Mar '16    Mar 15

The Directors are pleased to present their Eleventh Annual Report on business and operations of your Company together with Audited Financial Statements for the Financial Year ended on March 31, 2016. Consolidated performance of the Company and its subsidiaries has been referred to wherever required.

FINANCIAL HIGHLIGHTS: (Rs, in Lakhs)

Particulars

Standalone

Consolidated

2015-16

2014-15

2015-16

2014-15

Total Revenue

30,891.23

19,822.33

41,481.96

26,603.12

Total Expenditure

27,554.79

17,777.39

36,198.65

23,777.63

Profit Before Tax

3,336.44

2,044.94

5,236.63

2,825.49

Tax Expenses

1,115.05

251.48

2,175.33

397.40

Profit After Tax

2,221.39

1,793.46

3,061.29

2,428.09

Balance in Profit & Loss Account brought forward from Previous Year

6,035.61

4,753.28

6,500.83

4,583.87

Appropriations:

a) Proposed Dividend

308.67

308.67

308.67

308.67

b) Tax on Dividend

62 .84

52.46

62.84

52.46

Transfer to General Reserve

-

150.00

-

150.00

Surplus carried to the next year’s account

7,885.47

6,035.61

9,190.62

6,500.83

PERFORMANCE REVIEW:

- Income

Consolidated Income, comprising Revenue from Operations (Net) and Other Income for the year was Rs,41,481.96 Lakhs as compared to Rs, 26,603.12 Lakhs in the previous year. On the standalone basis, your Company’s performance in the current Financial Year, in terms of Total Income stood at Rs, 30,891.23 Lakhs as compared to Rs, 19,822.33 Lakhs in the previous year.

- Profit Before Tax

Consolidated profit Before Tax for the year was Rs, 5,236.63 Lakhs as against Rs, 2,825.49 Lakhs in the previous year. On the standalone basis, your Company’s Profit Before Tax for the current year was Rs,3,336.44 Lakhs as against Rs, 2,044.94 Lakhs in the previous year.

- Profit After Tax

Consolidated Profit After Tax for the year was Rs, 3,061.29 Lakhs as against Rs, 2,428.09 Lakhs in the previous year. On the standalone basis, your Company’s Profit After Tax for the current year was Rs, 2,221.39 Lakhs as against Rs, 1,793.46 Lakhs in the previous year.

The Company’s performance has been discussed in detail in ‘Management Discussion & Analysis Report’.

SHARE CAPITAL:

The movement of Equity Capital is as under:

Particulars

No. of Equity Shares

Equity Capital as on April 1, 2015

2,05,78,004

Increase/ Decrease during the year

NIL

Equity Capital as on March 31, 2016

2,05,78,004

Your Company has only one class of Equity Shares and it has neither issued shares with differential rights as to dividend, voting or otherwise nor issued shares (including sweat equity shares) to the employees or Directors of the Company, under any Scheme.

No disclosure is required under Section 67(3)(c) of the Companies Act, 2013 (“Act”) in respect of voting rights not exercised directly by the employees or Key Managerial Personnel of the Company as the provisions of the Section are not applicable.

DIVIDEND:

The Board, in its meeting held on May 23, 2016, has recommended Dividend of '' Rs,1.50 per share (15%) on the share capital of 2, 05, 78,004 Equity Shares of Rs, 10/- each (previous year Rs, 1.50 per share i.e. 15%). The proposal is subject to approval of the shareholders being obtained at the ensuing Annual General Meeting. The Dividend on Equity Shares, if approved by the members would involve a total outgo of Rs, 371.51 Lakhs, including Dividend Distribution Tax of Rs, 62.84 Lakhs as against Rs, 361.13 Lakhs, including Dividend Distribution Tax of Rs, 52.46 Lakhs in the previous year.

TRANSFER TO RESERVES:

Your Company do not propose to transfer to General Reserve out of the amount available for appropriations and an amount of Rs, 2689.78 Lakhs is proposed to be retained in the Profit and Loss Account.

FINANCIAL LIQUIDITY:

As at March 31 2016, your Company had liquid assets of Rs, 1028.77 Lakhs as against Rs, 1553.98 Lakhs at the previous year end on consolidated basis. Your company maintains sufficient cash reserves to meet its operations and strategic objectives.

DEPOSITS:

Your Company has not accepted any deposits from public within the purview of Section 73 & 74 of the Act read with Companies (Acceptance of Deposits) Rules, 2014 during this Financial Year and, as such, no amount of principal or interest was outstanding as of the Balance Sheet date. The Company has no deposit which is not in compliance with the provisions of Chapter V of the Act and as the Companies (Acceptance of Deposit) Rules, 2014.

PARTICULARS OF LOANS, GUARANTEE OR INVESTMENTS:

Details of Loans, Guarantees and Investments covered under the provisions of Section 186 of the Act and Schedule V of the SEBI (Listing Obligation and Disclosure Requirements) Regulations, 2015 (hereinafter referred to as “Securities And Exchange Board Of India Listing Regulations, 2015”) are given in the notes to the Financial Statements.

FINANCIAL STATEMENTS:

Pursuant to the provisions of Section 136 of the Act, the Financial Statements of the Company, the Consolidated Financial Statements along with all relevant documents and the Auditors’ Report thereon form part of this Annual Report. The Consolidated Audited Annual Financial Statements are prepared as per Section 129(3) read with Schedule III of the Act, Accounting Standards (AS-21) issued by the Institute of Chartered Accountants of India as notified by the Ministry of Corporate Affairs and Regulation 33 of SEBI (Listing Obligations And Disclosure Requirements) Regulations, 2015. Accordingly, the previous year’s figures have also been regrouped/ restated wherever necessary to conform to the classification of the current year.

Pursuant to provisions of Section 129(3) of the Act read with Rule 5 of the Companies (Accounts) Rules, 2014, a Statement containing salient features of the Financial Statements of the Company’s Subsidiaries/ Associate Companies/ Joint Ventures is given in Form AOC-1 (Annexure A) and forms an integral part of this Report. Further, pursuant to the provisions of Section 136 of the Act, the Financial Statements of the Company, Consolidated Financial Statements and separate audited accounts in respect of subsidiaries, are available on the website of the Company and also the Registered Offices of the respective companies.

RATINGS:

Credit Ratings of your company have been upgraded from CRISIL BB / Stable to BWR BBB for fund based bank borrowings & CRISIL A4 to BWR A3 for non-fund based facilities.

MATERIAL CHANGES AND COMMITMENTS:

Except as disclosed elsewhere in the Report, there have been no material changes in commitment between the end of Financial Year to which this financial statements relates on the date of this Report.

SCHEME OF ARRANGEMENT:

The Board of Directors of the Company in their meeting held on March 28, 2016, after considering the recommendations of the Audit Committee, approved the Composite Scheme of Arrangement under Section 391 to 394 and other applicable provisions, if any, of the Companies Act, 1956, as amended and the corresponding provisions of the Companies Act, 2013 to the extent notified or to be notified including any statutory modifications(s) or re-enactment(s) thereof and SEBI Listing Regulations, 2015, subject to necessary approvals of the appropriate authorities including Stock Exchange(s), SEBI and respective shareholders & creditors of the companies involved in the Scheme and sanction of the Hon’ble High Court of Judicature at Mumbai. The appointed date of

DIRECTORS’ REPORT the Composite Scheme is April 1, 2015.

In terms of Regulation 37 of SEBI Listing Regulations, 2015, the Company has received Observation Letters, dated June 2, 2016 from National Stock Exchange of India Limited and June 6, 2016 from BSE Limited, to the Composite Scheme of Arrangement, conveying their approval for filing the Scheme with the Hon’ble High Court. The details in respect of Scheme of Arrangement are included in the Management Discussion & Analysis, which forms part of this Report. Details of the Scheme have been uploaded on the Company’s website (www.omkarchemicals.com).

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS:

There are no significant and material orders passed by the regulators or courts or tribunals that would impact the going concern status of the Company and its future operations.

INTERNAL FINANCIAL CONTROLS:

The details in respect of internal financial controls and their adequacy are included in the Management Discussion & Analysis, which forms part of this Report.

SUBSIDIARY COMPANIES:

The Company has 5 subsidiaries as on March 31, 2016. There are no associate companies or joint venture companies within the meaning of Section 2(6) of the Act. There has been no material change in the nature of the business of the subsidiaries.

A detailed discussion on the subsidiaries of the Company namely, Lasa Laboratory Private Limited, Urdhwa Chemicals Company Private Limited, Rishichem Research Limited, Desh Chemicals Private Limited and Lasa Supergenerics Limited, have been dealt in the Management Discussion and Analysis, which forms part of this Report.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO:

The particulars as prescribed under Section 134(3)(m) of the Act read with Rule 8(3) of the Companies (Accounts) Rules, 2014 relating to Conservation of Energy, Technology absorption, Foreign Exchange earnings and outgo is provided in Annexure B, which forms part of this Report.

EXTRACT OF ANNUAL RETURN:

The details forming part of the extract of the Annual Return in Form MGT-9, as required under Section 92(3) of the Act read with Rule 12(1) of the Companies (Management and Administration) Rules, 2014, is included in this report as Annexure C and forms an integral part of the Directors’ Report.

DIRECTORS AND KEY MANAGERIAL PERSONNEL:

The Board of Directors had re-appointed Mr. Pravin S. Herlekar (DIN: 00525610) as Chairman and Managing Director and Mr. Omkar P. Herlekar (DIN: 01587154) as Whole Time Director for a further period of five (5) years commencing from April 1, 2015 till March 31, 2020. The members at the 10th Annual General Meeting (AGM) held on September 26, 2015 had approved the said re-appointments.

Further, the Board of Directors had appointed CA Laxmikant R. Kabra (DIN: 00061346), CA Sitendu K. Sharma (DIN: 01956423), Mr. Vikas G. Gadre (DIN: 06746818), Mr. Subhash N. Ghalke (DIN: 07239171), Adv. Sanjivani S. Patare (DIN: 07239170), Mr. Rishikesh P. Herlekar (DIN: 05240009) and Mr. Prakash H. Rao (DIN: 07239167) as Additional Directors of the Company. The members at the 10th Annual General Meeting (AGM) held on September 26, 2015 had approved their appointments. Whereas, Prof. (Dr.) Suhas M. Rane (DIN: 03126514), Mr. Subhash P. Mali (DIN: 00034769) and Dr. Vikas N. Telvekar (DIN: 03123785) were appointed as Independent Directors at the 9th Annual General Meeting held on August 9, 2014, for a term of 5 years ending on August 8, 2019.

As on March 31, 2016, the Board comprised of 13 (Thirteen) Directors out of which 9 (Nine) were Non-Executive Directors of which 7 (Seven) Directors were Independent Directors. Pursuant to the Regulation 17(1)(b) of the SEBI Listing Regulations, 2015 every listed company shall have at least half of its total strength of the Board of Directors as Independent Directors. Based on the present composition of the Board of Directors, your Company complies with this requirement.

- Inductions:

On the recommendations of the Nomination and Remuneration Committee, Mr. Subhash P. Mali (DIN: 00034769) has been redesignated as Executive Director on the Board of the Company for a period of 3 years w.e.f. May 23, 2016. A separate proposal

DIRECTORS’ REPORT

seeking approval of the members for the appointment of Mr. Subhash P. Mali as an Executive Director of your Company has been incorporated in the Notice of the ensuing Annual General Meeting. The terms of his appointment are given in the Explanatory Statement to the Notice of Annual General Meeting.

In the opinion of your Directors, Mr. Subhash P. Mali has the requisite qualifications and experience which would be useful to your Company and would enable him to contribute effectively in his capacity as Executive Director of your Company.

It is, therefore, considered prudent that your Company should continue to avail the services of Mr. Subhash P. Mali and the Board recommends that the proposed resolution relating to the appointment of Mr. Subhash P. Mali as the Executive Director of your Company be approved.

The Board of Directors, on the recommendation of the Nomination & Remuneration Committee also appointed:

- Mr. Pravin J. Agrawal as the Chief Financial Officer and Chief Investor Relations Officer w.e.f. December 12, 2015

- CS Sunny D. Pagare as Company Secretary and Compliance Officer w.e.f. December 12, 2015

- Re-appointments:

In accordance with the provisions of Section 152 of the Act and the Articles of Association of the Company, Mr. Omkar P. Herlekar (DIN: 01587154) and CA Laxmikant R. Kabra (DIN: 00061346) are liable to retire by rotation at the ensuing Annual General Meeting and being eligible, have offered themselves for re-appointment. Mr. Omkar P. Herlekar and CA Laxmikant R. Kabra have confirmed their respective eligibility and willingness to accept the office of the Directors of your Company, if confirmed by the members at the ensuing Annual General Meeting. Items seeking your approval on the above re-appointments are included in the Notice convening Annual General Meeting.

In the opinion of your Directors, Mr. Omkar P. Herlekar and CA Laxmikant R. Kabra have requisite qualifications and experience and therefore, your Directors recommend that the proposed resolutions relating to their re-appointment be passed.

- Resignations:

Mrs. Anjali P. Herlekar resigned as Non-Executive Director of the Company w.e.f. May 23, 2016.

Mr. Hiral G. Patel has relinquished his position Chief Financial Officer and Chief Investor Relations Officer of the company w.e.f. December 12, 2015.

Mr. Nirav K. Momaya resigned as Company Secretary and Compliance Officer of the Company w.e.f. October 23, 2015.

The Board placed on record its appreciation for the services rendered by them during their tenure with the Company. DECLARATION BY INDEPENDENT DIRECTORS:

All Independent Directors of the Company have given declarations that they meet the criteria of independence as laid down under Section 149(6) of the Act and Regulation 16(1) (b) of the SEBI Listing Regulations, 2015. In the opinion of the Board, they fulfill the conditions of independence as specified in the Act and the Rules made there under and are independent of the management.

ANNUAL EVALUATION:

The Act states that formal annual evaluation needs to be carried out by the Board of its own performance and that of its committees and individual directors. Schedule IV (Code for Independent Directors)of the Act states that the performance evaluation of Independent Directors shall be done by the entire Board of Directors, excluding the Director being evaluated.

Your Company had carried out an annual evaluation of performance of its Board and its Committees and individual Directors. The evaluation process has been explained in detail in the Corporate Governance Report, which forms a part of this Report.

BOARD MEETINGS HELD DURING THE YEAR:

During the year under review, 9 (Nine) meetings of the Board of Directors were held as required under the Act and SEBI Listing Regulations, 2015. The details pertaining to the composition, terms of reference, etc. of the Board of Directors of your Company and the meetings thereof held during the Financial Year are given in the Report on Corporate Governance section forming part of this Annual Report.

DIRECTORS’ RESPONSIBILITY STATEMENT:

In terms of provisions of Section 134(3)(c) and Section 134(5) of the Act, the Board of Directors of Omkar Speciality Chemicals Limited, to the best of their knowledge and ability, in respect of the Financial Year ended March 31, 2016, confirm that:

1. In the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures;

2. They had 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 the Financial Year and of the profit of the Company for that period;

3. They had 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;

4. They had prepared the annual accounts on a going concern basis;

5. They had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively; and

6. They had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

BOARD COMMITTEES:

The Board of Directors has the following Committees:

1. Audit Committee

2. Stakeholders’ Relationship Committee

3. Nomination and Remuneration Committee

4. Corporate Social Responsibility Committee

5. Risk Management Committee

6. Resource Committee

7. Whistle Blower Committee

8. Internal Complaints Committee

The Board of Directors at its meeting held on May 23, 2016 considered reconstitution of the Committees of the Board. The revised composition of the committees of the Board is given elsewhere in this Annual Report. The details of the Committees along with their composition, number of meetings and attendance at the meetings are provided in the Corporate Governance Report.

NOMINATION & REMUNERATION POLICY OF THE COMPANY:

The Board of Directors has framed a policy which lays down a framework in relation to remuneration of Directors, Key Managerial Personnel and Senior Management of the Company. This policy also lays down criteria for selection and appointment of Board Members. The details of this policy are explained in the Corporate Governance Report.

RISK MANAGEMENT POLICY:

The Company has laid down procedures to inform the members of the Board about the risk assessment and minimization procedures. These procedures have been periodically reviewed to ensure that the executive management controls the risk through properly defined framework. There are no risks which in the opinion of the Board may threaten the existence of the company.

WHISTLE BLOWER POLICY:

The Company has devised an effective Vigil Mechanism for stakeholders including Directors, shareholders, employees to report concerns about unethical behavior, actual or suspected fraud or violation of the company’s code of conduct or ethics policy to freely communicate their concerns about illegal or unethical practices. The policy has been explained in detail in the Corporate Governance Report, which forms a part of this Report.

FAMILIARISATION PROGRAMMES FOR BOARD MEMBERS:

The details in respect of Familiarization programmers for Board members are included in the Corporate Governance Report, which forms part of this Report.

CORPORATE SOCIAL RESPONSIBILITY (CSR):

In terms of Section 135 of the Act, every company having Net Worth of Rupees Five Hundred Crore or more, or Turnover of Rupees One Thousand Crore or more or a Net Profit of Rupees Five Crore or more during any Financial Year shall constitute a Corporate Social Responsibility Committee of the Board consisting of three (3) or more Directors, out of which at least one Director shall be an Independent Director. All such companies are required to spend at least 2% of the average Net Profits of their three (3) immediately preceding Financial Years on CSR related activities. Accordingly, your Company was required to spend Rs, 46.79 Lakhs toward CSR activities, out of which Rs, 0.25 Lakhs was utilized. The Board of Directors of the Company has constituted a Corporate Social Responsibility (“CSR”) Committee. The Company also has in place a CSR policy and the same is available on the website of the Company and can be accessed through web link: http://www.omkarchemicals.com/ Policies/CSR-Policy_OSCL.pdf. The details on CSR have been briefly discussed in Annexure D forming part of the Directors’ Report.

TRANSACTIONS WITH RELATED PARTIES:

Related Party Transactions that were entered into during the Financial Year were on an arm’s length basis, in the ordinary course of business and were in compliance with the applicable provisions of the Act and the SEBI Listing Regulations, 2015. Company’s major Related Party Transactions are generally with its wholly owned subsidiaries. There were no materially significant Related Party Transactions made by the Company during the year. The details of transactions with related parties are given for information under notes to the accounts of the Balance Sheet as at March 31, 2016.

The Company has adopted a Related Party Transactions Policy. The Policy, as approved by the Board, is uploaded on the Company’s website and can be accessed through web link: http://www.omkarchemicals.com/Policies/RPT%20%20&%20Material%20Non-listed%20Subsidiaries.pdf. Details of the transactions with Related Parties are provided in the accompanying financial statements. There were no transactions during the year which would require to be reported in Form AOC-2.

POLICY ON SEXUAL HARASSMENT OF WOMEN AT WORKPLACE:

The Company has zero tolerance towards sexual harassment at the workplace and towards this end, has adopted Anti-Sexual Harassment Policy, in line with the provisions of Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the Rules there under. The Policy aims to provide protection to employees at the workplace and prevent and redress complaints of sexual harassment and for matters connected or incidental thereto. All employees (permanent, contractual, temporary, trainees) are covered under the said policy. An Internal Complaints Committee has also been set up to redress complaints received on sexual harassment.

The Company has not received any complaint of sexual harassment during the Financial Year 2015-16.

ENVIRONMENTAL CLEARANCE FOR MANUFACTURING UNIT LOCATED AT CHIPLUN:

The Company has received Environmental Clearance from the State Government for its manufacturing Unit V located at Plot No. D-27/5, M.I.D.C., Lote Parshuram Industrial Area, Chiplun, Taluka Khed, District Ratnagiri, Maharashtra. The details for the same can be viewed on the website of the Company (www.omkarchemicals.com) and of Maharashtra Government for Environmental Clearance (www.ec.maharashtra.gov.in). The projected capacity of this Unit is 4,500 tonnes. The production at this unit shall commence in a phased manner. In Phase I, the Company plans to produce Vitamin C and Folic Acid.

HUMAN RESOURCE MANAGEMENT AND INDUSTRIAL RELATIONS:

Your Company recognizes its human resources as one of its prime & critical resources. The relations between the Management and the Staff Members remained very cordial throughout the year under review. As on March 31, 2016 the Company had 132 permanent employees. Two (2) employees were employed throughout the year and in receipt of remuneration of Rs, 60 Lakhs per annum or more. There was no employee who was employed for the part of the Financial Year 2015-16 and was in receipt of remuneration of Rs, 5 Lakhs per month or more. There was no employee who was in receipt of remuneration in the year which was in excess of the remuneration of the Managing Director or Whole Time Director. Disclosure pertaining to the remuneration and other details as required under Section 197(12) of the Act, and the Rules framed there under is enclosed as Annexure E to the Board’s Report.

MANAGEMENT DISCUSSION AND ANALYSIS:

Pursuant to Regulation 34 read with Schedule V of the SEBI Listing Regulations, 2015, detailed review of operations, performance and future outlook of the Company is covered under a separate Annexure to this report as Management’s Discussion & Analysis.

REPORT ON CORPORATE GOVERNANCE:

In Compliance with SEBI Listing Regulations, 2015, new Listing Agreements as per revised format with BSE and NSE were executed on December 14, 2015. A detailed Report on Corporate Governance, pursuant to the requirements of SEBI Listing Regulations, 2015 forms part of the Annual Report. A Certificate from the Auditors of the Company, M/s J.P.J Associates, Chartered Accountants, confirming compliance with the conditions of Corporate Governance as stipulated under the aforesaid Schedule V (E) of SEBI Listing Regulations, 2015, also forms part of the Annual Report.

The Business Responsibility Reporting as required by Regulation 34(2) of the SEBI Listing Regulations, 2015, is not applicable to your Company for the Financial Year ending March 31, 2016.

REGULATORY APPROVALS:

The relevant regulations and policies as prescribed by the Government of India and other regulatory bodies have been duly complied with by your Company.

Our manufacturing facilities are monitored and approved by various regulatory authorities. Periodically, the FDA, MPCB, Department of Explosives etc. conducts routine audits of all approved facilities.

AUDITORS AND AUDITOR’S REPORT: -

Statutory Auditors:

At the Annual General Meeting held on August 9, 2014, M/s. J.P.J. Associates, Chartered Accountants, Mumbai (Firm Regn. No.: 113012W) were appointed as Statutory Auditors of the Company to hold office till the conclusion of the twelfth (12th) Annual General Meeting to be held in the calendar year 2017. In terms of the first proviso to Section 139 of the Act, the appointment of the Auditors shall be ratified by members at every Annual General Meeting. Accordingly, the appointment of M/s. J.P.J. Associates, Chartered Accountants, Mumbai (Firm Regn. No.: 113012W) as the Statutory Auditors of the Company is placed for ratification by the shareholders.

In this regards, the Company has obtained written confirmation from M/s. J.P.J. Associates that their appointment, if ratified, would be in accordance with Section 139 read with Section 141 of the Act. Further, in terms of the Regulation 33(1)(d) of the SEBI Listing Regulations, 2015, the Statutory Auditors of your Company are subjected to the Peer Review Process of the Institute of Chartered Accountants of India (ICAI). M/s. J.P.J. Associates have confirmed that they hold a valid certificate issued by ‘Peer Review Board’ of ICAI.

In view of the above, the Board of Directors recommends ratification of the appointment of M/s. J.P.J. Associates, Chartered Accountants as the Statutory Auditors as mentioned at Item No. 5 of the Notice. Members are requested to consider the ratification of the appointment of M/s. J.P.J. Associates and authorize the Board of Directors to fix their remuneration.

The Auditors’ Report for Financial Year 2015-16 does not contain any qualification, reservation or adverse mark. The Auditors’ Report is enclosed with the Financial Statements in this Annual Report.

- Cost Auditors:

As per the requirement of Section 148 of the Act read with the Companies (Cost Records and Audit) Rules, 2014 as amended from time to time, your Company has been carrying out audit of cost records every year. The Board of Directors, on the recommendation of Audit Committee, has appointed M/s N. Ritesh & Associates, Cost Accountants, Mumbai (Firm Regn. No.:100675) as the Cost Auditor to audit the cost records of the Company for Financial Year 2016-17.

The Company is seeking the ratification of the Shareholders for the appointment of M/s N. Ritesh & Associates, Cost Auditors, Mumbai (Firm Regn. No.: 100675) as the Cost Auditor of the Company for the Financial Year ending March 31, 2017 vide Item no. 7 of the Notice of AGM.

- Secretarial Auditors:

Pursuant to the provisions of Section 204 of the Act and The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Board of Directors of the Company had appointed M/s Nilesh A. Pradhan & Co., Practicing Company Secretary (Membership No. FCS 5445) to undertake the Secretarial Audit of the Company for the year ended March 31, 2016. The Secretarial Audit Report for the Financial Year ended March 31, 2016 has been annexed to this Report as Annexure F and forms an integral part of this Report.

In connection with the auditors observation in the Secretarial Audit Report it is clarified that:

Observation No. 1: Your Company will take adequate measures to do the needful in future appropriately.

Observation No. 2: The non-filing of Form MGT-14 in respect of one Board Resolution is a technical lapse that occurred inadvertently. Observation No. 3 and 4: your Company has noted the same for proper compliance.

DETAILS IN RESPECT OF FRAUDS REPORTED BY AUDITORS:-

Auditors of the Company have not reported any frauds to the Audit Committee or to the Board of Directors under section 143(12) of the Companies Act, 2013, including rules made there under.

SECRETARIAL STANDARDS:

The Ministry of Corporate Affairs notified the Secretarial Standard on Meetings of the Board of Directors (SS — 1) and Secretarial Standard on General Meetings (SS — 2) effective from July 1, 2015. Your Company complies with the same.

Your Company will comply with the other Secretarial Standards issued by the Institute of Company Secretaries of India (ICSI) as and when they are made mandatory.

ACKNOWLEDGEMENTS:

Your Directors place on record their appreciation to Company’s esteemed clients, vendors, investors, business associates and bankers for their continuous support to the Company.

The Directors also thank the Central & State Governments, Governments of various countries, Customs & Excise Departments, Ministry of Commerce, Ministry of Finance, Ministry of External Affairs, Ministry of Corporate Affairs, Maharashtra Industrial Development Corporation and other Government Agencies for their positive support, and look forward to their continued support in the future.

Your Directors also place on record their appreciation for the contribution made by the employees at all levels but for whose hard work, and support, your Company’s achievements would not have been possible.

For and On behalf of the Board

For Omkar Speciality Chemicals Limited

Sd/-

Pravin S. Herlekar

Date: May 23, 2016 Chairman & Managing Director

Place: Badlapur (DIN: 00525610)

Source : Dion Global Solutions Limited
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