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Tata Coffee Directors Report, Tata Coffee Reports by Directors

Tata Coffee

BSE: 532301|NSE: TATACOFFEE|ISIN: INE493A01027|SECTOR: Plantations - Tea & Coffee
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Directors Report Year End : Mar '17    Mar 16

To the Members,

The Directors are pleased to present the 74th Annual Report together with the Audited Statement of Accounts for the year ended 31st March, 2017.


Your Company has adopted Indian Accounting Standards (Ind AS) from 1st April, 2016 and these are the Company''s first annual financial statements prepared in accordance with Ind AS, with comparatives for the previous year restated as per Ind AS.

The Company''s financial performance for the year ended 31st March 2017 is summarized below:

(Rs. in Crores)







Revenue from Operations





Other Income





Total Income





Profit Before Exceptional Items and Taxes





Add: Exceptional Income/(Expenses)





Profit Before Tax





Provision for Tax





Profit After Tax





Less: Non-controlling Interests



Profit After Tax attributable to Shareholders of the






Surplus brought forward from Previous Year





Amount available for appropriation





General Reserve No. I





General Reserve No. II





Reversal of Dividend Distribution Tax





Dividend paid relating to Previous Year





Tax on Dividend





Balance carried forward





1. Revenue from Operations:


Your Company''s total income during the year under review was Rs. 848 Crores as compared to Rs.753 Crores in the previous year, registering an increase of 13% over the previous year.


The Consolidated total income during the year under review was Rs.1629 Crores as compared to Rs.1571 Crores in the previous year, registering an increase of 4% over the previous year.

2. Profits:


The Profit before Tax for the year 2016-17 was Rs.182 Crores as against Rs.102 Crores in the previous year. Profit after Tax in 2016-17 stood at Rs.139 Crores as against Rs.65 Crores in the previous year.


On a Consolidated basis, Profit before Tax for the year 2016-17 was Rs.318 Crores as against Rs.206 Crores in the previous year. Profit after Tax (net of minority interest) in 2016-17 stood at Rs.151 Crores as against Rs.82 Crores in the previous year.

3. Dividend & Reserves:

Your Directors have recommended a Dividend of Rs.1.75/- per share (face value of Rs.1 per share) for the year ended 31st March 2017, which includes a special dividend of Rs.0.25 per share to commemorate the completion of 25 years of a Tata Group Company acquiring controlling interest in Tata Coffee Limited (erstwhile Consolidated Coffee Limited). The total Dividend amount aggregates to Rs.32.68 Crores plus applicable Dividend Distribution Tax. It is proposed to carry forward a sum of Rs.14.00 Crores towards General Reserve No. I.

4. Share Capital:

The Paid-up Equity Share Capital of the Company as on 31st March, 2017 was Rs.18.68 Crores comprising of 18,67,70,370 Shares of Rs.1/- each. The Company has not issued shares with differential voting rights, employee stock options and sweat equity shares. The Company has paid Listing Fees for the Financial Year 2017-18 to each of the Stock Exchanges, where its equity shares are listed.

5. Material changes and commitment - if any, affecting financial position of the Company from the end of the financial year till the date of this Report:

There has been no material change and commitment, affecting the financial performance of the Company which occurred between the end of the financial year of the Company to which the financial statements relate and the date of this Report.

6. Global Coffee Scenario:

The Global Coffee Markets in 2016-17 presented distinctly different pictures for Arabica and Robusta Coffees. On an overall basis, the crop year 2016-17 witnessed a balanced scenario between supply (production) and demand (consumption). The total production of coffee, across multiple estimates was around 155 million bags (60 kgs) matched by almost equal demand of 155 million bags. However, the break-up provides a different picture. The Arabica production, estimated at 95 million bags was an all-time record and the Robusta production at an estimated 60 million bags was the lowest in over 5 years. This deficit of Robusta - over 10% on demand - was only partly compensated by the Arabica surplus. This was indeed the driving force behind the terminal movements for the year.

The New York (ICE) terminal, representing Arabica settled at 141.65 Cents / lb (Jul futures) on 31st March 2017. It had settled for the same position at 129.35 Cents / lb (Jul futures) on 1st April 2016. This year, wide rise in the Arabica terminal was a modest 9.5%. In sharp contrast, the London terminal, representing Robusta coffee saw an increase of 43% through the year. It settled at 2171 $ / MT (Jul futures) on 31st March 2017 as against a close of 1519 $ / MT on the same position at the start of the year on 1st April. The sharp deficit of Robusta coffee was therefore the key defining feature of the market through the FY 2016-17.

7. Company''s Performance:

A. Plantations:


During the financial year 2016-17, the Company has harvested a Robusta crop of 6,000 MT as against 6,222 MT in the previous year. In the case of Arabica, a production of 1,628 MT has been harvested in being an off year as against 1,899 MT in the previous season. The coffee harvesting operation and post-harvest operations has been completed as per schedule.

Planting district of Coorg and Hassan recorded a 46% shortfall in rainfall leading to a drought like situation. The distribution was also distorted with some unprecedented showers during harvest period. The average temperature increased significantly affecting the growth of plants and also the development of bean.


The Company produced a total of 5.666 Million Kgs of Made tea for the Financial Year 2016-17 as against 6.180 Million kgs in the previous year. The current year''s production is less by 8%. Shortfall in quantum of rainfall recorded during the season and with distorted distribution coupled with increased day temperature affected the flush growth and thereby impacting crop.


The Company has achieved a pepper production of 544 MT for the Financial Year 2016-17 compared to 599 MT harvested during 2015-16. The density and grade percentage of pepper this year has been good. The Company has initiated various steps to further enhance the production base of pepper in the coming years.

Curing Works:

The Company''s Curing Works at Kushalnagar (KNW) cured a total of 11,528 MT Coffee during the current year as against 11,162 MT in the previous year. In addition, a record quantity of 520 MT of Monsoon Coffee was processed against the average quantity of 300 MT in the recent years.

Pepper Processing Unit:

The entire Pepper of the Company is graded and processed at KNW. The unit has graded & processed 537 MT of Pepper during the Financial Year 2016-17. The unit is certified under ISO 22000:2005 and SA 8000:2008.

Green Coffee Exports:

During the Financial Year 2016-17, your Company exported 6,420 MT of coffee as against 6,332 MT in the previous year. Your Company continues to focus on growth, through Premium Differentiated Coffees with volumes sold at 52% of the total exports at very healthy premiums.

Plantation Trails:

Plantation Trails, our hospitality business, continues to grow and perform exceedingly well recording the highest ever revenues and profits since inception. Emphasis for the year has been on the digital transformation and realignment for the business. A new mobile enabled website and payment gateway, a new reservation module, and a complete revamp of the social media channels and digital marketing approach, have given the business the online edge. Chickmagalur was recently introduced as a new destination and the property continues to receive positive reviews.

Plantation Trails was the recipient of several industry awards during the year including the prestigious recognition by Trip Advisor for the Certificate of Excellence-Winner. International and domestic travel media continue to make mentions about Coorg and the ''Plantation Trails'' experience.

B. Instant Coffee Operations:

The financial year 2016-17 saw the Instant Coffee Division achieving record sales and production. The total sales volumes for the financial year 2016-17 was 8812 MT compared to 7,660 MT in the previous financial year, registering an increase of 15% over the previous year. The production for the year was 8474 MT compared to 7,986 MT in the last fiscal. The plant capacity utilization is more than the designed capacity (8400 TPA). The state-of-the-art Freeze Dried Coffee (FDC) facility also underwent a limited debottlenecking project to achieve its full capacity during the year.

The sales volume growth was healthy across all key geographies - namely Russia and Commonwealth of Independent States, Africa, Europe and Middle East. The Company continued to consolidate its dominant market positions in Russia and Africa and also expanded into potential growth markets in Asia. The Company significantly increased its value added focus in terms of product and packaging. New product variants developed for select markets helped the Company to provide right value to the buyers and also differentiate itself from the competition. The Company also strengthened its sales and marketing team to ensure widespread reach and deeper customer connect.

Tata Coffee Grand:

The Company manufactures ''Tata Coffee Grand'', an Instant Coffee for sale in domestic market, which is being distributed and marketed by the Holding company, Tata Global Beverages Ltd. The Brand has received positive response in the market. In addition, during the year, there were two product variants HTS (Hot Tea Shops) with blend of Spray Dried Coffee with Chicory, and R&G with blend of Roasted and Ground coffee with Chicory, packed for the domestic market as part of overall Tata Coffee Grand portfolio.

C. Starbucks Roastery:

The Unit did 15% higher production and processed 119 MT during the current year as against 102 MT in the previous year. The Unit is successfully qualified by Starbucks for Expresso, India Estates Blend, Kenya, Sumatra and Italian roasted coffees. The Unit continues to cater exclusively to the requirements of TATA Starbucks outlets in India from its state-of-the-art Coffee Roasting Facility at Kushalnagar Works. The Unit is certified under ISO 9001:2008 (Quality Management System), FSSC 22000 (Food Safety & Standards Certification), ISO 14001:2004 (Environment Management System) and FSSAI (Food Safety and Standards Authority of India).

8. Business Growth:

Your Company has a dedicated team of Management and Operating Personnel who have been instrumental in the growth of the business over the years. Your Directors believe that the Company has the potential to further scale up its business volumes and profitability and are in the process of identifying new avenues of growth and effective utilization of its existing resources.

9. Quality Awards:

(i) Sustainability Awards:

Your Company has consistently been committed to environment protection and co-exists with nature at the coffee plantations.

The Company has been awarded the ''Excellence in Work Place Safety'' trophy for its elephant conservation project, in the Confederation of Indian Industry IQ National Safety Competition. Further, the Company was recognized as the ''Most Ethical Company'' in the Agriculture Sector in November 2016.

The Anandapur, Karadibetta, Ubban, Valparai and Yemmigoondi Estates of the Company have bagged Regional and Specialty awards for their Arabica and Robusta Coffee.

(ii) Instant Coffee Operations (ICD):


ICD-Toopran stepped into a milestone of achieving EHS 4 star in 2016-17, which has proven the continual development in the areas of Environmental, Occupational Health and Safety Management Systems.

ICD-Toopran also achieved the prestigious FTAPCCI (Federation of Telangana and Andhra Pradesh Chambers of Commerce and Industry) Award for excellence in Industrial Productivity.

I CD-Theni received SEEM (Society of Energy Engineers and Managers) National Energy Management Award 2016.


Instant Coffee Unit, Toopran

Toopran Unit was certified for Integrated Management System (IMS) comprising of ISO 9001, ISO 14001, OHSAS 18001, along with certification on ISO 22000, HALAL, KOSHER, BIS, FSSAI, SA 8000, UTZ, SAN-RA.

Instant Coffee Unit, Theni

Theni Unit was certified for Integrated Management System (IMS) comprising of ISO 9001, ISO 14001, BS OHSAS 18001, along with certification on ISO 22000, HALAL, KOSHER, BRC, IFS, FSSAI, SA 8000, UTZ, SAN-RFA.

The Theni Unit Laboratory was certified with NABL (National Accreditation Board for Testing and Calibration Laboratories).

10. Capital Expenditure:

During the Financial Year 2016-17, Rs.4497.53 Lakhs was incurred towards capital expenditure primarily on account of welfare, modernization, upgradation and other programmes undertaken in the various units of the Company.

11. Subsidiary Companies and Consolidated Financial Statements:

Subsidiary Companies:

I. Eight O'' Clock Coffee Company (EOC):

The total Income of EOC during the Financial Year 2016-17 was at Rs.827 Crores, under Ind AS, compared to Rs.843 Crores for the previous year. The EOC''s bags volumes sold were marginally higher than the previous year amidst intense competitive spending. EOC''s total income also includes royalty income from the single serve K-cups sold under a licensing agreement with Keurig. K-cup volumes were lower than previous year due to intense competitive pressures. EOC''s profits were higher on account of higher sales, and lower costs.

II. Consolidated Coffee Inc. (CCI):

CCI is the Holding Company of EOC. The Consolidated net profit after taxes was Rs.117 Crores as compared to Rs.85 Crores for the previous year.

Performance of Subsidiaries:

Pursuant to the provisions of Section 129(3) of the Companies Act, 2013 (''the Act''), a statement containing salient features of Financial Statements of subsidiaries in Form AOC-1 is annexed as Annexure - A.

The Company does not have any Associate or Joint Venture Companies. The Company has adopted a policy for determining the criteria of material subsidiaries which can be viewed on the Company''s website at www.tatacoffee.com

12. Freeze Dried Instant Coffee Facility in Vietnam:

The Board of Directors of the Company at their meeting held on 19th December 2016 approved setting up of a state-of-the-art green field Freeze Dried Instant Coffee facility in Vietnam of 5000 MT capacity per annum through a Subsidiary Company, with an estimated Project Cost of Rs.350 Crores. Pursuant thereto, the Company has on 4th May 2017, infused an amount of Rs.30.49 Crores in the equity capital of Tata Coffee Vietnam Company Limited which is a Wholly-owned Subsidiary of the Company. The Directors are happy to report that the Project is making satisfactory progress.

13. Directors Responsibility Statement:

Based on the framework of Internal Financial Controls and compliance systems established and maintained by the Company, the work performed by the Internal, Statutory, Cost and Secretarial Auditors including Audit of Internal Financial Controls over financial reporting by the Statutory Auditors and the reviews performed by Management and the relevant Board Committees, including the Audit Committee, the Board is of the opinion that the Company''s Internal Financial Controls were adequate and effective during the Financial Year 2016-17.

Accordingly, pursuant to Section 134(3)(c) and 134(5) of the Act, the Board of Directors, to the best of their knowledge and ability, confirm that:

(i) in the preparation of the accounts for the Financial Year ended 31st March, 2017, the applicable accounting standards have been followed and that there are no material departures;

(ii) they have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at the end of the Financial Year and of the profits of the Company for that period;

(iii) they have taken proper and sufficient care to the best of their knowledge and ability for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

(iv) they have prepared the Accounts for the Financial Year ended 31st March, 2017 on a ''going concern'' basis;

(v) they have laid down Internal Financial Controls to be followed by the Company and such Internal Financial Controls are adequate and are operating effectively;

(vi) they have devised proper systems to ensure compliance with the provisions of all applicable laws and such systems were adequate and are operating effectively.

14. Directors & Key Managerial Personnel:

Prof. Arun Monappa, Non-executive Independent Director of the Company retired on 9th March 2017, on reaching the retirement age as per the Governance Guidelines adopted by the Board. Your Directors wish to place on record their sincere appreciation for the valuable contribution made by Prof. Monappa during his tenure as Director of the Company.

The Board of Directors at its meeting held on 18th May 2017 appointed Dr. P. G. Chengappa as an Additional Director of the Company with effect from that date. Pursuant to the provisions of Section 161 of the Act, Dr. Chengappa holds office till the date of ensuing Annual General Meeting and is eligible for appointment. A resolution in this behalf is set out at Item No.5 of the Notice of Annual General Meeting, for members'' approval.

Further, the Board of Directors, at its meeting held on 18th May 2017, subject to the approval of the Members at the ensuing Annual General Meeting, re-appointed Mr. K. Venkataramanan as Executive Director - Finance and Chief Financial Officer for a further term of 3 years with effect from 25th October 2017, on terms of remuneration as recommended by the Nomination & Remuneration Committee. A resolution in this behalf is set out at Item No.6 of the Notice of Annual General Meeting, for members'' approval.

Pursuant to the provisions of Section 152 of the Act, Mr. R. Harish Bhat, Director, will retire by rotation at the ensuing Annual General Meeting and being eligible, has offered himself for re-appointment. The Board recommends his re-appointment.

I n terms of Section 203 of the Act, the following are the Key Managerial Personnel of the Company:

- Mr. Sanjiv Sarin, Managing Director & CEO

- Mr. K. Venkataramanan, Executive Director - Finance & CFO

- Mr. N. Anantha Murthy, Head - Legal & Company Secretary

Mr. N. S. Suryanarayanan, who earlier held the position of Company Secretary, retired from the services of the Company, effective 19th December 2016.

All the Independent Directors have given their declarations stating that they meet the criteria of independence as laid down under Section 149(6) of the Act and Regulation 16(1)(b) of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations 2015 (''the Listing Regulations''). In the opinion of the Board, they fulfill the conditions of independence as specified in the Act and the Listing Regulations and are independent of the management.

15. Board and Committee Meetings:

An Annual Calendar of Board and Committee Meetings planned during the year was circulated in advance to the Directors.

The Board has constituted an Audit Committee comprising of Mr. S. Santhanakrishnan as Chairman, Ms. Sunalini Menon, Mr. V. Leeladhar and Mr. Siraj Azmat Chaudhry as its Members. There have been no instances during the year where recommendations of the Audit Committee were not accepted by the Board.

The details of the composition of the Board and its Committees and number of meetings held and attendance of Directors at such meetings are provided in the Corporate Governance Report, which forms part of the Annual Report.

16. Governance Guidelines:

The Company has adopted Governance Guidelines on Board Effectiveness. The Governance Guidelines encompasses aspects relating to composition and role of the Board, Chairman and Directors, Board Diversity, Definition of Independence, Term of Directors, Retirement Age and Committees of the Board. It also covers aspects relating to Nomination, Appointment, Induction and Development of Directors, Director Remuneration, Subsidiary oversight, Code of Conduct, Board Effectiveness Review and Mandates of Board Committees.

17. Policy on Director''s Appointment and Remuneration and other details:

(a) Procedure for Nomination and Appointment of Directors:

The Nomination and Remuneration Committee (NRC) has been mandated to oversee and develop competency requirements for the Board based on the industry requirements and business strategy of the Company. The NRC reviews and evaluates the resumes of potential candidates for appointment of Directors and meets them prior to making recommendations of their nomination to the Board. Specific requirements for the position, including expert knowledge expected, are communicated to the appointee.

On the recommendation of the NRC, the Board has adopted and framed a Remuneration Policy for the Directors, Key Managerial Personnel and other employees pursuant to the provisions of the Act and the Listing Regulations. The remuneration determined for Executive/ Independent Directors is subject to the recommendation of the Nomination and Remuneration Committee and approval of the Board of Directors. The Non-Executive Directors are compensated by way of profit sharing commission and the criteria being their attendance and contribution at the Board/Committee Meetings. The Executive Directors are not paid sitting fees; the Non-Executive Directors are entitled to sitting fees for the Board/Committee Meetings.

It is affirmed that the remuneration paid to Directors, Key Managerial Personnel and all other employees is in accordance with the Remuneration Policy of the Company. The Company''s Policy on Directors'' Appointment and Remuneration and other matters provided in Section 178(3) of the Act and Regulation 19 of the Listing Regulations have been disclosed in the Corporate Governance Report, which forms part of the Annual Report.

(b) Familiarization/Orientation program for Independent Directors:

The Independent Directors attend a Familiarization / Orientation Program on being inducted into the Board. The details of Familiarization Program are provided in the Corporate Governance Report and are also available on the Company''s website. The Company issues a formal letter of appointment to the Independent Directors, outlining their role, function, duties and responsibilities, the format of which is available on the Company''s website at

18. Dividend Distribution Policy:

As required under Regulation 43A of the Listing Regulations, the Company has formulated a Policy on Dividend Distribution, which is attached as Annexure - B. This Policy can also be viewed on the Company''s website at

19. Annual Evaluation of Board Performance and Performance of its Committees and of Directors:

Pursuant to the applicable provisions of the Act and the Listing Regulations, the Board has carried out an Annual Evaluation of its own performance, performance of the Directors and the working of its Committees on the evaluation criteria defined by Nomination and Remuneration Committee (NRC) for performance evaluation process of the Board, its Committees and Directors.

The Board''s functioning was evaluated on various aspects, including inter-alia the structure of the Board, meeting of the Board, functions of the Board, degree of fulfillment of key responsibilities, establishment and delineation of responsibilities to various Committees, effectiveness of Board processes, information and functioning.

The Committees of the Board were assessed on the degree of fulfillment of key responsibilities, adequacy of Committee composition and effectiveness of Meetings. The Directors were evaluated on aspects such as attendance, contribution at Board/Committee Meetings and guidance/support to the Management outside Board/Committee Meetings.

The performance assessment of Non-Independent Directors, Board as a whole and the Chairman were evaluated in a separate meeting of Independent Directors. The same was also discussed in the meetings of NRC and the Board. Performance evaluation of Independent Directors was done by the entire Board, excluding the Independent Director being evaluated.

20. Internal Control Systems & their adequacy:

The Board has adopted policies and procedures for ensuring the orderly and efficient conduct of its business, including adherence to the Company''s policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial disclosures.

21. Reporting of Frauds:

There was no instance of fraud during the year under review, which required the Statutory Auditors to report to the Audit Committee and / or Board under Section 143(12) of the Act and the rules made there under.

22. Transfer to Investor Education and Protection Fund:

As required under Section 124 of the Act, the unclaimed dividend amount aggregating to Rs.10,02,912/- pertaining to the financial year ended on 31st March, 2009 and Unclaimed Interest on Debentures aggregating to Rs.59,807/- lying with the Company for a period of seven years were transferred during the year 2016-17, to the Investor Education and Protection Fund established by the Central Government.

23. Auditors:

(i) Statutory Auditors:

The term of office of M/s SNB Associates, Chartered Accountants (Firm Registration No. 015682N) who were appointed as the Joint Statutory Auditors at the 73rd Annual General Meeting of the Company held on 26th July 2016, expires upon conclusion of the ensuing Annual General Meeting of the Company.

The Members at the 73rd Annual General Meeting of the Company held on 26th July, 2016, had appointed M/s. Deloitte Haskins & Sells LLP, Chartered Accountants (Firm Registration No. 117366W/W-100018) as the Statutory Auditor of the Company to hold office for a term of five years i.e., from the conclusion of the said Annual General Meeting until the conclusion of 78th Annual General Meeting of the Company to be held in 2021, subject to ratification of their appointment by the shareholders, every year. The Notice of Annual General Meeting contains a resolution to this effect, for your approval.

(ii) Cost Auditors:

In terms of the provisions of Section 148 of the Act read with the Companies (Cost Records and Audit) Rules, 2014, as amended from time to time, the Board of Directors, based on the recommendation of the Audit Committee, has appointed M/s. Rao, Murthy & Associates, Cost Accountants, as Cost Auditor of the Company for conducting the Cost Audit for the Financial Year 2017-18, on a remuneration as mentioned in the Notice of 74th Annual General Meeting.

A resolution seeking Member''s ratification for the remuneration payable to the Cost Auditor forms part of the Notice of 74th Annual General Meeting and the same is recommended for your consideration and ratification.

(iii) Secretarial Auditor:

Pursuant to the provisions of Section 204 of the Act and the rules made there under, the Company had appointed M/s. HBP & Co., Company Secretaries, to undertake the Secretarial Audit of the Company for the year ended 31st March, 2017. The Secretarial Audit Report issued in this regard is annexed as Annexure - C.

The Auditors'' Report and the Secretarial Audit Report for the Financial Year ended 31st March, 2017 do not contain any qualification or reservation or adverse remark.

24. Risk Management:

The Company has constituted a Risk Management Committee which has been entrusted with the responsibility to assist the Board in (a) approving the Company''s Risk Management Framework and (b) Overseeing all the risks that the organization faces such as strategic, financial, liquidity, security, regulatory, legal, reputational and other risks that have been identified and assessed to ensure that there is a sound Risk Management Policy in place to address such concerns/risks. The Risk Management process covers risk identification, assessment, analysis and mitigation. Incorporating sustainability in the process also helps to align potential exposures with the risk appetite and highlight risks associated with chosen strategies.

The Audit Committee has additional oversight in the area of financial risks and controls. Major risks identified by the business and functions are systematically addressed through mitigating actions on continuing basis.

The Company has adopted a Risk Management Policy in accordance with the provisions of the Act and Regulation 21 of the Listing Regulations.

25. Particulars of Loans, Guarantees and Investments:

The details of Loans and Investments covered under the provisions of Section 186 of the Act are given in the Notes to the Financial Statements forming part of Annual Report. The Company has not provided any guarantees during the Financial Year.

26. Fixed Deposit:

During the year under review, your Company has neither accepted nor renewed any deposits from the public within the meaning of Section 73 of the Act and the Companies (Acceptance of Deposits) Rules, 2014.

27. Related Party Transactions:

All Related Party Transactions that were entered into during the Financial Year under review were on an arm''s length basis and in the ordinary course of business and is in compliance with the applicable provisions of the Act and the Listing Regulations. There were no materially significant Related Party Transactions made by the Company during the year that required shareholders'' approval under Regulation 23 of the Listing Regulations.

All Related Party Transactions are placed before the Audit Committee for prior approval. Prior omnibus approval of the Audit Committee is obtained for the transactions which are repetitive in nature or when the need for them cannot be foreseen in advance .

None of the transactions entered into with related parties falls under the scope of Section 188(1) of the Act. Details of transactions with related parties as required under Section 134(3)(h) of the Act read with Rule 8(2) of the Companies (Accounts) Rules, 2014 are given in Annexure - D in Form AOC-2 and forms part of this Report.

The Company has adopted a Policy for dealing with Related Party Transactions. The Policy as approved by the Board may be viewed on the Company''s website at the web link: party.pdf

28. Corporate Governance & Management Discussion & Analysis Report:

Your Company is in compliance with all the applicable provisions of Corporate Governance as stipulated under Chapter IV of the Listing Regulations. A detailed report on Corporate Governance as required under the Listing Regulations is provided in a separate section and forms part of the Annual Report. Certificate from the Practicing Company Secretary regarding compliance with the conditions stipulated in the Listing Regulations forms part of the Corporate Governance Report.

The Management Discussion and Analysis Report as required under the Listing Regulations is presented in a separate section and forms part of the Annual Report.

29. Business Responsibility Report:

As required under Regulation 34 of the Listing Regulations, the Business Responsibility Report is provided in a separate section and forms part of the Annual Report.

30. Employees Welfare:

The Company continues to focus on welfare and improving the quality of lives of its employees by providing educational assistance to their children, creche and child care facilities, transport at subsidized rate to school going children and supply of provisions at cost through co-operative stores.

31. Policy on Prevention, Prohibition and Redressal of Sexual Harassment at Work place:

The Company has zero tolerance for sexual harassment at workplace and has adopted a Policy on Prevention, Prohibition and Redressal of Sexual Harassment at workplace in line with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the rules made there under. The Policy aims to provide protection to employees at workplace and prevent and redress complaints of sexual harassment and for matters connected or incidental thereto, with the objective of providing a safe working environment, where employees feel secure. The Company has also constituted an Internal Complaints Committee, known as the Prevention of Sexual Harassment (POSH) Committee, to enquire into complaints of sexual harassment and recommend appropriate action.

During the Financial Year 2016-17, the Company received 2 complaints on sexual harassment, which have been disposed of and appropriate actions were taken.

32. Whistle Blower Policy/Vigil Mechanism:

The Company has adopted a Whistle Blower Policy to provide a formal mechanism to the Directors and employees to report their concerns about unethical behavior, actual or suspected fraud or violation of the Company''s Code of Conduct or Ethics Policy. The Policy provides for adequate safeguards against victimization of employees who avail of the mechanism and also provides for direct access to the Chairman of the Audit Committee. It is affirmed that no personnel of the Company has been denied access to the Audit Committee. The Whistle Blower Policy has been posted on the website of the Company at www.tatacoffee.com

33. Corporate Social Responsibility (CSR):

The Annual Report on CSR activities in terms of the requirements of Companies (Corporate Social Responsibility Policy) Rules, 2014 is annexed as Annexure - E, which forms part of this Report.

The Company has a Corporate Social Responsibility Policy and the same has been posted on the website of the Company at www.tatacoffee.com

34. Extract of Annual Return:

Pursuant to Section 92(3) of the Act and Rule 12(1) of the Companies (Management and Administration) Rules, 2014, the extract of the Annual Return in the prescribed form i.e., Form MGT-9 is annexed herewith as Annexure - F, which forms part of this Report.

35. Particulars of Employees and Remuneration:

In terms of the first proviso to Section 136 of the Act, the Reports and Accounts are being sent to the shareholders excluding the information required under Rule 5(2) and (3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014. Any shareholder interested in obtaining the same may write to the Company Secretary at the Registered Office of the Company. The said information is available for inspection by the Members at the Registered Office of the Company on any working day of the Company up to the date of the 74th Annual General Meeting.

The statement containing information as required under the provisions of Section 197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is given in Annexure - G and forms part of this Report.

36. Particulars of Conservation of Energy, 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 Act read with Rule 8(3) of the Companies (Accounts) Rules 2014 is annexed as Annexure - H and forms part of this Report.

37. Significant and Material Orders passed by the Regulators or Courts:

There are no significant or material orders which were passed by the Regulators or Courts or Tribunals which impact the going concern status and the Company''s Operations in future.

38. Green Initiatives:

I n commitment to keep in line with the Green Initiative and going beyond it to create new green initiatives, electronic copy of the Notice of 74th Annual General Meeting of the Company are sent to all Members whose email addresses are registered with the Company/Depository Participant(s). For members who have not registered their e-mail addresses, physical copies are sent through the permitted mode.

39. Acknowledgement:

Your Directors take this opportunity to thank the Parent Company - Tata Global Beverages Limited, the employees, customers, vendors, investors and the communities in which the Company operates, for their continued valuable support and co-operation extended to the Company during the year.

Your Directors also thank the Government of India, Government of various States in India and concerned government departments/agencies for their co-operation.

Your Directors appreciate and value the contributions made by every member of Tata Coffee family.

For and on behalf of the Board

Place: Bengaluru R. HARISH BHAT

Date: 18th May, 2017 Chairman

Source : Dion Global Solutions Limited
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