Mar 31, 2018
To,
The Members of E-Land Apparel Limited
The Directors present the 21st Annual Report of the Company together with the Audited Financial Statements for the financial year ended 31st March, 2018.
FINANCIAL RESULTS:
The financial performance of the Company for the year ended 31st March, 2018 is summarized below:
(Rs. In Lakhs)
Particulars |
Year ended |
Year ended |
31st March, 2018 |
31st March, 2017 |
|
Operational & Other Income |
18579.73 |
21904.93 |
Loss before Interest, Depreciation, Prior period items, Exceptional Items & Tax |
(1780.71) |
(4247.19) |
Interest |
2,241.33 |
3,407.35 |
Depreciation & Amortization |
209.43 |
366.49 |
Loss before exceptional items and tax |
(4,231.47) |
(8,021.03) |
Prior period items |
- |
- |
Exceptional Items |
3611.02 |
- |
Loss before tax |
(7842.49) |
(8021.03) |
Less/(Add): Provision for Taxation including prior period adjustments |
- |
- |
Other Comprehensive Income |
63.69 |
802.71 |
Deferred Tax |
- |
- |
Total Comprehensive Income after tax |
(7,778.80) |
(7,218.32) |
OPERATIONS OF THE COMPANY / COMPANY PERFORMANCE:
The Companyâs total income from operations for F.Y. 2017-18 at Rs. 18,371.52 Lakhs was less as compared to last year by 15.78% (Rs 21,814.55 Lakhs in F.Y. 2016-17). The total expenses for F.Y. 2017-18 at Rs. 22,811.20 Lakhs were lesser by 23.77% over last year (Rs. 29,925.96 Lakhs in F.Y. 2016-17). Loss after tax for F.Y. 2017-18 stood at Rs. 7,842.49 Lakhs as against Rs. 8,021.03 Lakhs for F.Y. 2016-17 reflecting decrease of losses by 2.23%.
TRANSFER TO RESERVES:
As there are losses for the financial year 2017 - 2018, the Company did not transfer any amount to reserves during the year. DIVIDEND:
As there are no profits, the Board of Directors of the Company does not recommend any payment of dividend on the shares for the financial year 2017 - 2018.
UNPAID DIVIDEND & IEPF
The Unpaid Dividend amount Rs. 1,37,316 (One Lakh Thirty Seven Thousand Three Hundred and Sixteen) as standing in the Unpaid Dividend Account bearing no. 386103000001076 maintained with IDBI Bank Limited, Cash Management Services (Transaction Banking Group) 4th Floor, Mafatlal Centre, Nariman Point, Mumbai - 400 021 which remained unpaid or unclaimed for a period of seven years were transferred to the Investor Education and Protection Fund established by the Central Government). Amount of Rs. 763 is lying in Unpaid Dividend A/c of the Company and shall be transferred to Investor Education and Protection Fund
MATERIAL CHANGES AND COMMITMENTS: a) CORPORATE DEBT RESTRUCTURING (CDR):
The Company, in the year 2012, had applied for the restructuring of its debts through Corporate Debt Restructuring (CDR) Mechanism as envisaged under the Reserve Bank of India (RBI) guidelines. Pursuant to the same, based on approval of the CDR cell, the Company entered into a Master Restructuring Agreement in September 2012. In 2016, the Company had applied for One Time Settlement (OTS) with all the banks in the consortium, pursuant to which, approval was received during the year from all the banks for the OTS in respect of the borrowing.
During the quarter ended June 30,2018, the One Time Settlement formalities including reconciliation of balances, settlement of dues, final approval from CDR, receipt of âNo Dues Certificateâ from banks etc. have been completed intimation with respect to such settlement has been provided to the exchanges and the relevant forms for Satisfaction of Charge is also filed
SHARE CAPITAL
During the year under review, your Companyâs Authorized Share Capital is Rs. 6,001 Lakhs comprising of 60,010,000 Equity Shares of Rs. 10/- each. The Companyâs paid up capital is Rs. 4,799.05 Lakhs comprising of 4 ,79,90,469 Equity Shares of Rs. 10/- each fully paid up. During the year under review, the Company has not issued any shares. The Company has not issued shares with differential voting rights. It has neither issued employee stock options nor sweat equity shares. As on March 31, 2018, none of the Directors of the Company holds shares of the Company.
LISTING
The Equity Shares of the Company are listed on BSE Limited (BSE) with scrip code no. 532820 and on National Stock Exchange of India Limited (NSE) with symbol as ELAND.
The listing fee for the year 2017-18 has been paid to both the Stock Exchanges.
DIRECTORS & KEY MANAGERIAL PERSONNEL
The Board of the Company comprises of Seven Directors, including one Managing Director, one Whole Time, One Nominee Director appointed by State bank of India and Four Independent Directors including One Woman Director as required under Section 149(1) of the Companies Act, 2013 as on 31st March, 2018.
Appointment
a) Mr. Jae Ho Song was appointed as the Managing Director of the Company w.e.f. 30th May, 2017
b) Mr. Supriyo Kumar Chaudhuri who was appointed as Nominee Director of State Bank of India on the Board of the Company w.e.f. 30th May, 2017
c) Ms, Hemlata Gupta was appointed as Company Secretary w.e.f. 30th May,2018.
Resignation
a) Mr. Jung Ho Hong (having DIN 02229634), has tendered his resignation as the Whole time Director of the Company with effect from 06th of July, 2018.
b) Mr. Supriyo Kumar Chaudhuri who was appointed as Nominee Director of State Bank of India on the Board of the Company w.e.f. 30th May, 2017 has tendered his resignation with effect from May 29, 2018.
c) Ms. Sunita Kanungo resigned from the post of Company Secretary w.e.f. 30th May,2018.
RETIREMENT BY ROTATION
In terms of Section 152 of the Companies Act, 2013 and the Articles of Association of the Company, Mr. Jae Ho Song (DIN: 07837031), retires by rotation at the ensuing Annual General Meeting and being eligible, offers himself for re-appointment. He has confirmed that he is not disqualified from being appointed as Director in terms of Section 164 of the Companies Act, 2013. A brief resume of Mr. Jae Ho Song (DIN: 07837031), nature of his expertise in specific functional areas and names of the Companies in which he holds directorship and / or membership / chairmanship of Committees of the Board, as stipulated under the SEBI (Listing Obligations and Disclosure Requirements), 2015 with the Stock Exchange/s, is given in the Corporate Governance Report which may be taken as forming part of this Report.
DECLARATION BY INDEPENDENT DIRECTORS:
The independent directors have submitted the Declaration of Independence, as required pursuant to section 149(7) of the Companies Act, 2013 and Regulation 16 and 25 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 stating that they meet the criteria of independence as provided in sub-section (6). There has been no change in the circumstances, which has affected their status as independent director. Non-Executive Directors of the Company had no pecuniary relationship other than sitting fee for attending meetings.
FORMAL ANNUAL EVALUATION OF THE PERFORMANCE OF BOARD, ITS COMMITTEES AND DIRECTORS:
Pursuant to the provisions of the Companies Act, 2013 and the regulation 25 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, a separate meeting of Independent Directors was held during the year without the presence of Executive Directors. The Board has adopted a formal mechanism for evaluating various aspects of the Boardâs functioning its performance and as well as that of its committee and individual directors. The criteria for performance evaluation of the Board include aspects like composition of the Board and its Committees, culture, execution and performance of specific duties, obligations and governance, experience, competencies etc. The exercise was carried out through a structured evaluation process covering various aspects of the Boards functioning such as composition of the Board and Committees, experience and competencies, performance of specific duties and obligations, governance issues etc. Separate exercise was carried out to evaluate the performance of Individual Directors who was evaluated on parameters such as attendance, contribution at the meetings and otherwise, independent judgment, safeguarding of minority shareholders interest The Board of Directors expressed their satisfaction with the evaluation process.
EXTRACT OF ANNUAL RETURN:
The extract of annual return as provided under sub-section (3) of Section 92 of the Companies Act, 2013, in the prescribed Form MGT - 9 is attached as âAnnexure Aâ to this Report. Further a copy of annual return filed for the financial year 2016-17 and a copy of Annual Return to be filed for the financial year 2017-18 with the Registrar of Companies is placed on the website of the Company: www.elandapparel.com
NUMBER OF MEETINGS OF THE BOARD:
Regular meeting of the Board are held during the year to review performance of the Company, to discuss and decide on various business strategies, policies and other issues. During the year 5 meetings of the Board of Directors were convened and held on 30th May, 2017, 19th August 2017, 14th September, 2017, 08th December, 2017, 14th February, 2018. The intervening gap between two consecutive meetings was not more than the period specified in the Companies Act, 2013 and Listing Regulations, 2015. The Detailed information about the same is given in the Corporate Governance Report.
The Company has complied with the applicable Secretarial Standards in respect of all the above Board meetings.
COMMITTEES OF THE BOARD
The Board of Directors of your Company has constituted the following committees in terms of the provisions of the Companies Act, 2013 and the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015:
- Audit Committee
- Nomination and Remuneration Committee
- Stakeholdersâ Relationship Committee
- Risk Management Committee
The details regarding composition and meetings of these committees held during the year under review as also the meetings of the Board of Directors are given in the Corporate Governance Report which may be taken as forming part of this Report.
REMUNERATION / COMMISSION DRAWN FROM HOLDING / SUBSIDIARY COMPANY
None of the Directors of the Company have drawn any remuneration / commission from the Companyâs holding Company / subsidiary Companies
MANAGEMENT DISCUSSION AND ANALYSIS
The Management Discussion and Analysis Report on the operations of the Company as required under SEBI Listing (Obligation and Disclosure Requirement) Regulations, 2015 is provided in separate section and form an integral part of this report.
CORPORATE GOVERNANCE REPORT
As per Regulation 34 (3) and Chapter IV read with Schedule V of the SEBI Listing (Obligation and Disclosure Requirement) Regulations, 2015 a separate Section on Corporate Governance Practices followed by the Company, together with a certificate from the Companyâs Secretarial Auditors confirming compliances forms an integral part of this Report.
FIXED DEPOSITS:
The Company has not accepted / renewed any deposits within the meaning of Section 73 and Section 74 of the Companies Act, 2013 and the Rules made thereunder.
DIRECTORâS RESPONSIBILITY STATEMENT:
Pursuant to the provisions of Section 134(3)(c) of the Companies Act, 2013, your Directors state that:-
(1) In the preparation of the annual accounts, for the year ended 31st March, 2018, the applicable Accounting Standards have been followed and that there are no material departures;
(2) Appropriate accounting policies have been selected 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 31st March, 2018 and of the loss of the Company for the year ended 31st March, 2018;
(3) Proper and sufficient care has been taken for 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;
(4) They have prepared the annual accounts on a âGoing Concernâ basis.
(5) Proper internal financial controls were followed by the Company and that such internal financial controls are adequate and were operating effectively.
(6) Proper systems to ensure compliance with the provisions of all applicable laws were in place and that such systems were adequate and operating effectively.
NOMINATION AND REMUNERATION POLICY
The Board on the recommendation of the Nomination and Remuneration Committee has framed a Remuneration Policy, providing
(a) criteria for determining qualifications, positive attributes and independence of directors and
(b) a policy on remuneration for directors, key managerial personnel and other employees.
The detailed Nomination and Remuneration Policy is placed on Companyâs website at http://elandapparel.com/policy.htm
PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS:
Information regarding loans, guarantees and investments covered under the provisions of Section 186 of the Companies Act, 2013 are detailed in the Financial Statements.
RELATED PARTY TRANSACTIONS:
All related party transactions that were entered into during the financial year were on an armâs length basis and were in the ordinary course of business.
All Related Party Transactions upto 31st March, 2018 were placed before the Audit Committee and the Board for approval. Prior omnibus approval of the Audit Committee was obtained for Related Party Transactions for the financial year 2017-18. The transactions entered into pursuant to the omnibus approval so granted were audited and a statement giving details of all related party transactions was placed before the Audit Committee for its review on a quarterly basis.
There are related party transactions as per Section 188 of Companies Act, 2013, the details of the same are disclosed in Form AOC-2 in that regard which is attached as âAnnexure Bâ to this report.
The Policy on RPTs as approved by Board is uploaded on the Companyâs website at http://elandapparel.com/policy.htm
The Company undertakes the transactions of purchase and sale of goods and availing/rendering services with E-Land Group of Companies as mentioned in point 32 in Notes to Accounts.
None of the Directors/Key Managerial Personnel has any pecuniary relationships or transactions vis-a-vis the Company which may have potential conflict with the interest of the Company at large.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO:
Information in accordance with the provisions of Section 134(3)(m) of the Companies Act, 2013, read with the Companies (Accounts) Rules, 2014 regarding Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo is attached as âAnnexure Câ to this report.
RISK MANAGEMENT POLICY:
Information on the development and implementation of a Risk Management Policy for the Company including identification therein of elements of risk which in the opinion of the Board may threaten the existence of the Company is given in the Corporate Governance Report.
VIGIL MECHANISM / WHISTLE BLOWER POLICY:
In accordance with Section 177(9) and (10) of the Companies Act, 2013, the Company has established a Whistle Blower Policy and Vigil Mechanism. The policy is available on the Companyâs website at http://www.elandapparel.com/whistle-blower-policy.pdf
CORPORATE SOCIAL RESPONSIBILITY:
As the Company does not fall under any of the threshold limits given under the provisions of Section 135 of the Companies Act, 2013, the compliances under CSR are not applicable to the Company.
PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES:
The Company does not have any employee drawing remuneration above the limits mentioned in Section 197(12) of the Companies Act, 2013 read with Rules 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 as amended from time to time, the details of the same is attached in âAnnexure Eâ to this report.
INFORMATION UNDER THE SEXUAL HARRASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013:
The Company has zero tolerance for sexual harassment at workplace and has adopted a policy against sexual harassment in line with the provisions of Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the rules framed thereunder. The Company already has an Internal Complaints Committee but shall be reconstituted on account of some resignations.
During the financial year 2017 - 2018, the Company has not received any complaints on sexual harassment and hence no complaints remain pending as of 31st March, 2018.
REPORT ON PERFORMANCE OF SUBSIDIARIES, ASSOCIATES AND JOINT VENTURE COMPANIES
During the year under review, your Company did not have any subsidiary, associate and joint venture company SIGNIFICANT & MATERIAL ORDERS PASSED BY THE REGULATORS & COURTS.
There were no penalties orders passed during the year.
INTERNAL CONTROL SYSTEMS & THEIR ADEQUACY:
The Company has an internal control system, commensurate with the size, scale and complexity of its operations. This ensures that all transactions are authorized, recorded and reported correctly, and assets are safeguarded and protected against loss from unauthorized use or disposition. Your Company has adequate internal controls for its business processes across departments to ensure efficient operations, compliance with internal policies, applicable laws and regulations, protection of resources and assets and appropriate reporting of financial transactions.
The Company has Internal Audit function which is empowered to examine the adequacy and compliance with policies, plans and statutory requirements. It comprises of experienced professionals who conduct regular audits across the Companyâs operations. The Company has also appointed a firm of Chartered Accountants as Internal Auditors, who reviews the various functions of the Company thoroughly and report to the Audit Committee. During the year under review, the Risk Management Committee of the Company had reviewed the new requirement of Internal Control over Financial Reporting (âICOFRâ) and finalized the detailed analysis of key processes, and these were presented for review by the Statutory Auditors. The control mechanism and the process of testing of controls were discussed with the Statutory Auditors. The Statutory Auditors have submitted their report on the Internal Financial Controls which forms an integral part of this Report.
The adequacy of the same has been reported by the Statutory Auditors of your Company in their report as required under the Companies (Auditorâs Report) Order, 2003.
HUMAN RESOURCES:
Your Company considers its Human Resources as the key to achieve its objectives. Keeping this in view, your Company takes utmost care to attract and retain quality employees. The employees are sufficiently empowered and such work environment propels them to achieve higher levels of performance. The constant commitment of the employees is the driving force behind the Companyâs vision. Your Company appreciates the spirit of its dedicated employees.
AUDITORS:
In the Annual General Meeting (AGM) held on 30th September, 2016, Deloitte Haskins & Sells LLP, Chartered Accountants Mumbai having Firm Registration No.117366W/W-100018 have been appointed Statutory Auditors of the Company for a period of 5 years. Ratification of appointment of Statutory Auditors is being sought from the Members of the Company at the ensuing AGM.
They have also confirmed their compliance pursuant to Regulation 33 (1) (d) of the Listing Regulations, 2015 in respect of âPeer Review Certificateâ issued by the Peer Review Board of ICAI.
Further, the report of the Statutory Auditors along with notes to Schedules is enclosed to this report.
AUDITORSâ REPORT
There are no qualifications, reservations or adverse remarks made by Deloitte Haskins & Sells LLP, Chartered Accountants Mumbai, Statutory Auditors of the Company, in their report for the financial year ended 31st March, 2018. The Statutory Auditors have not reported any incident of fraud to the Audit Committee or to the Board of the Company in the year under review.
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 Company has appointed M/s. Shanu Mata & Associates, a firm of Company Secretaries in Practice to undertake the Secretarial Audit of the Company. The Secretarial Audit Report is attached herewith as âAnnexure Dâ.
The Secretarial Auditors have pointed out some observations in the
Secretarial Audit Report and the Companyâs response to the same is as below:
Sr.No |
Secretarial Auditorsâ Observation |
Managementâs Comment |
1 |
The Board meeting held on 19th August, 2017, for considering the reappointment of Mr. Jung Ho Hong neither has been intimated to the Stock Exchanges nor the outcome of the same has been filed with Stock Exchanges, contrary to the provisions of Reg.30 of the SEBI (LODR) Regulations, 2015 |
Intimation to Stock Exchange is not mandatory in case of re-appointment of Director liable to retire by rotation. The Company as a matter of good practice shall comply with the same in future. |
2 |
As per Secretarial Standard 7.2.2.1, it is obligatory to mention the time of commencement and conclusion of the meeting in the Minutes Book, but the Company has not recorded the same. However the outcome of the meetings filed with Stock Exchanges under SEBI (LODR) Regulations, 2015, is duly complied with the requirement of mentioning of commencement and conclusion timings of meetings |
The said omission is an inadvertent error and the conclusion time has been captured in all the meetings henceforth. |
3 |
As per Regulation 40(9) of SEBI (LODR) Regulations 2015, the Company has filed the copy of the Certificate received from a Practicing Company Secretary with BSE on 27th April, 2017 for the half year ended 31st March, 2017; but in the documents the date has been mentioned as 27th April, 2016 |
The said error is a typographic error and the same shall be avoided in future. |
4 |
As per Regulation 55A of SEBI (Depository & Participant) Regulations 1996, the Company has filed a copy of Reconciliation of Share Capital Audit Certificate for the quarter ended 31st March, 2017 at BSE on 25th April, 2017 but in the documents, the date has been mentioned as 25th April, 2016 |
The said error is a typographic error and the same shall be avoided in future. |
5 |
The Company has accorded the consent of the members of the Company by way of Special Resolution passed through Postal ballot, effective from 24th March, 2017, for shifting of its Registered Office from the State of Maharashtra (Mumbai) to the State of Karnataka (Bangalore) but the Company could not act on the same as Winding up petition was filed by one of the creditors with NCLT. The matter was disposed off as per the order passed by NCLT. Since the pending petition against the Company has been disposed off, hence the Company can now proceed for shifting of registered office from one place to another. |
The said petition had hindered the shifting of Registered Office. With the disposal of the same, the process has been commenced once again and post the hearing with Regional Director, the order for shifting of Registered office shall be obtained. |
RECONCILIATION OF SHARE CAPITAL AUDIT:
In compliance of circular no D&CC/FITTC/CIR-16/2002 dated 31st December, 2002 further amended by Circular No. CIR/ MRD/DP/30/2010 dated 6th September, 2010 issued by the Securities and Exchange Board of India (âSEBIâ), Reconciliation of Share Capital Audit has been carried out at the specified intervals by a Practicing Company Secretary and have been submitted to the Stock Exchanges where the Company is listed within due dates.
DISCLOSURE UNDER SECTION 43(a)(ii) OF THE COMPANIES ACT, 2013:
The Company has not issued any shares with differential rights and hence no information as per provisions of Section 43(a)(ii) of the Act read with Rule 4(4) of the Companies (Share Capital and Debenture) Rules, 2014 is furnished
DISCLOSURE UNDER SECTION 54(1)(d) OF THE COMPANIES ACT, 2013
The Company has not issued any sweat equity shares during the year under review and hence no information as per provisions of Section 54(1)(d) of the Act read with Rule 8(13) of the Companies (Share Capital and Debenture) Rules, 2014 is furnished.
DISCLOSURE UNDER SECTION 62(1)(b) OF THE COMPANIES ACT, 2013
The Company has not issued any equity shares under Employees Stock Option Scheme during the year under review and hence no information as per provisions of Section 62(1)(b) of the Act read with Rule 12(9) of the Companies (Share Capital and Debenture) Rules, 2014 is furnished.
DISCLOSURE UNDER SECTION 67(3) OF THE COMPANIES ACT, 2013
During the year under review, there were no instances of non-exercising of voting rights in respect of shares purchased directly by employees under a scheme pursuant to Section 67(3) of the Act read with Rule 16(4) of Companies (Share Capital and Debentures) Rules, 2014 is furnished.
APPRECIATION / ACKNOWLEDGEMENT:
Your Directors wish to place on record their appreciation and express their gratitude for the contribution made by the employees at all levels but for whose hard work, and support, your Companyâs achievements would not have been possible. The Board takes this opportunity to express its gratitude for the valuable assistance and co-operation extended by Government Authorities, Banks, Corporate Debt Restructuring (CDR) Cell, Financial Institutions, Vendors, Customers, Advisors and other business partners.
For and on behalf of the Board
SD/- SD/-
Date: 10 August, 2018 Jae Ho Song Chong Tae Baek
Place: Mumbai Managing Director Independent Director
DIN:07830731 DIN:01566661
Mar 31, 2016
To,
The Members of E-Land Apparel Limited (formerly known as Mudra Lifestyle Limited),
The Directors present the19th Annual Report of the Company together with the Audited Financial Statements for the financial year ended 31st March, 2016.
FINANCIAL RESULTS:
The financial performance of the Company for the year ended 31st March,2016 is summarized below:
(Rs. In Lakhs)
Particulars |
Year ended 31st March, 2016 |
Year ended 31st March, 2015 |
Operational & Other Income |
23,866.92 |
17,934.44 |
Loss before Interest, Depreciation, Prior period items, Exceptional Items & Tax |
(759.10) |
(1,187.10) |
Interest |
359.00 |
393.32 |
Depreciation & Amortization |
258.65 |
265.47 |
Loss before exceptional items and tax |
(1376.75) |
(1,845.89) |
Prior period items |
490.37 |
909.87 |
Exceptional Items |
- |
(1,430.19) |
Loss before tax |
(1867.12) |
(1325.57) |
Less/(Add): Provision for Taxation including prior period adjustments |
- |
2,576.77 |
Deferred Tax |
- |
- |
Loss after tax |
(1,867.12) |
(3,902.34) |
OPERATIONS OF THE COMPANY / COMPANY PERFORMANCE:
The Companyâs total income from operations for F.Y. 2015-16 at Rs. 23,454.56 Lakhs was higher by 34.00% over last year (Rs. 17,503.16 Lakhs in F.Y. 2014-15). The total expenses for F.Y. 2015-16 at Rs. 24,884.67 Lakhs was higher by 28.36% over last year (Rs. 19,387.01 Lakhs in F.Y. 2014-15). Loss after tax for F.Y. 2015-16 stood at Rs.1,867.12 Lakhs as against Rs. 3,902.34 Lakhs for F.Y. 2014-15.
TRANSFER TO RESERVES:
As there are losses for the financial year 2015-16, the Company did not transfer any amount to reserves during the year. DIVIDEND:
As there are no profits, the Board of Directors of the Company does not recommend any payment of dividend on the shares for the financial year 2015-16.
CORPORATE DEBT RESTRUCTURING (CDR):
In order to overcome debt repayment obligations, the Company had applied for the restructuring of its debts through CDR Mechanism envisaged under the Reserve Bank of India (RBI) guidelines dated 23rd August, 2001 and subsequent amendments thereto which was approved by the CDR Cell vide their letter of approval dated 27th June, 2012 subject to the compliance of the conditions mentioned therein and the implementation of the CDR Scheme within a period of 120 days from the issuance of the Letter of Approval. The Company has already executed Master Restructuring Agreement (MRA) and has opened the Trust and Retention Account (TRA) with SBI on the terms and conditions set out in Trust and Retention Account Agreement. Other follow-on procedures such as Security creation in favour of SBICAP Trustee Ltd., as a security Trustee for beneficial interest of all existing CDR lenders for majority of its properties is completed. The Company has proposed an offer to the CDR lender banks on 25th January, 2016 for One Time Settlement (OTS) of all its existing debts with the banks and repayment of entire outstanding principal and interest due and the waiver of the entire recompense portion. All the Lenders have approved the OTS proposal and same was placed before the CDR EG. CDR EG has approved the same and Company is in the process of complying with the OTS proposal.
SEBI NOTICE:
Your Company had received an order dated 4th June, 2013, issued under Sections 11(1), 11(2)(j), 11(4) and 11(B) of the SEBI Act, 1992 read with section 12A of SCRA Act, 1956 in relation to the compliance with requirement of Minimum Public Shareholding.
Mr.Murarilal Agarwal, Mr.Ravindra Agarwal, Mr.Vishwambharlal Bhoot (Old Promoters) and E-Land Asia Holdings Pte Ltd. formed the promoter group of your Company. As per the provisions of the Securities Contracts (Regulations) Rules, 1957, as amended (SCRR) and Clause 40A of the Listing Agreements entered into with Stock Exchanges where the shares of the Company are listed, your Company was required to maintain a public shareholding of 25% of the aggregate paid-up equity share capital (Minimum Public Shareholding Threshold) (MPS). Accordingly, the public shareholding of the Company falls short of the required MPS by 10.79%.
The Original Promoters thereby on 26th September, 2014, made an offer for sale of approximately 51,80,000 equity shares of face value of Rs.10 each representing 10.79% of the total paid-up share capital of the Company, through the stock exchange mechanism in accordance with circular no. CIR/MRD/DP/18/2012 dated July 18, 2012 issued by the SEBI and as amended by SEBI vide its circular no. CIR/MRD/DP/24/2014 dated August 8, 2014.
Minimum public shareholding was achieved on 26th September, 2014 through offer for sale mechanism. The Company had received an adjudication order from SEBI dated 29th September, 2015 and Company has complied with the same.
RBI COMPOUNDING ORDER
During the year ended March 31, 2014, Company had entered into a tripartite agreement with E-Land Asia Holdings Pte Ltd, its holding Company and Mr. Murarilal Agarwal, Mr. Ravindra Agarwal and Mr. Vishwambharlal Bhoot (Old Promoters) whereby the loan outstanding towards the Old promoters had been directly paid by the holding Company on behalf of the Company. As the loan was used to meet general corporate purpose, the Company had made an application under the applicable provisions of the Foreign Exchange Management Act (âFEMAâ) and the rules and regulations there under for regularizing the same. Company had received approval from the Reserve Bank of India (RBI), treating the Loan as an External Commercial Borrowing, subject to the applicable provisions for compounding under FEMA and the Regulations there under. Subsequently Company made Compounding application with RBI. Company received the Compounding order and is in the process of complying it with the same.
MATERIAL CHANGES AND COMMITMENTS:
There have been 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 and the date of this Report.
SHARE CAPITAL:
During the year under review, your Companyâs Authorized Share Capital is Rs. 6,001 Lakhs comprising of 60,010,000 Equity Shares of Rs. 10/- each. The Companyâs paid up capital is Rs. 4,799.05 Lakhs comprising of 4,79,90,469 Equity Shares of Rs. 10/- each fully paid up. During the year under review, the Company has not issued any shares. The Company has not issued shares with differential voting rights. It has neither issued employee stock options nor sweat equity shares. As on March 31, 2016, none of the Directors of the Company holds shares of the Company.
SHIFTING OF REGISTERED OFFICE OF THE COMPANY:
The Board pf Directors at its meeting held on Friday, 06th November, 2015 had decided to shift the registered office of the Company to 404, 4th Floor, Western Edge-1, Western Express Highay, Magathane, Borivali (east), Mumbai-400066 within the same city i.e Mumbai with effect from, 10th October, 2015, accordingly, Form INC-22 was filled with Registrar of Companies Mumbai which was duly approved.
LISTING:
The Equity Shares of the Company are listed on BSE Limited (BSE) with scrip code no. 532820 and on National Stock Exchange of India Limited (NSE) with symbol as ELAND.
The listing fee for the year 2015-16 has been paid to both the Stock Exchanges.
DIRECTORS & KEY MANAGERIAL PERSONNEL:
The Company has gone in for a major re-organization of its top leadership with the twin objective of accelerating growth and furthering its strategic goals. This strategic re-alignment will enable the company to focus on growth opportunities while furthering its leadership.
Mr. Kwang Hyuck Choi, Whole Time Director, has been appointed as the Managing Director of the Company with effect from 27th June, 2016 and his appointment and remuneration will be subject to the approval of the shareholders of the company and the Central Government, if required under Section 196, 197, 203 read with Schedule V of the Companies Act, 2013.
The remuneration to be paid to Mr. Kwang Hyuck Choi, Managing Director, had already been approved by the Nomination and Remuneration Committee at its meeting held on 27th June, 2016.
Your Directors take this opportunity to express their deep sense of appreciation for the valuable services rendered by Mr.Yangweon Yoo during his tenure as Director.
In accordance with the provisions of Section 152 of the Companies Act, 2013 read with Companies (Management & Administration) Rules, 2014 and Articles of Association of the Company, Mr. Jung Ho Hong is liable to retire by rotation at the ensuing Annual General Meeting of the Company. Mr. Jung Ho Hong, being eligible, offers himself for re-appointment.
Brief resume of the Directors proposed to be appointed/re-appointed as stipulated under Listing Agreement with the Stock Exchanges where the shares of the Company are listed are given in the Notice convening 19th Annual General Meeting.
The Company had filed requisite Form MR-2 for approval of reappointment and payment of remuneration for Mr. Yangweon Yoo on 7th April, 2015, Mr. Kwang Hyuck Choi and Mr. Jung Ho Hong on 6th April, 2015. The Company has received Central Government approval for reappointment and payment of remuneration to Mr. Yangweon Yoo vide order No. SRN C49141070/ 4/2015 - CL. VII dated 2nd February, 2016 and for Mr. Kwang Hyuck Choi vide order No. SRN C49067424/2015 - CL-VII dated 28th January, 2016. The Central Government approval is pending for reappointment and payment of remuneration to Mr. Jung Ho Hong and the follow up for the same is in process.
DECLARATION BY INDEPENDENT DIRECTORS:
The independent directors have submitted the Declaration of Independence, as required pursuant to section 149(7) of the Companies Act, 2013 stating that they meet the criteria of independence as provided in sub-section (6).
FORMAL ANNUAL EVALUATION OF THE PERFORMANCE OF BOARD, ITS COMMITTEES AND DIRECTORS:
Information on the manner in which formal annual evaluation has been made by the Board of its own performance and that of its Committees and individual directors is given in the Corporate Governance Report.
EXTRACT OF ANNUAL RETURN:
The extract of annual return as provided under sub-section (3) of Section 92 of the Companies Act, 2013, in the prescribed Form MGT - 9 is attached as âAnnexure Aâ to this Report.
NUMBER OF MEETINGS OF THE BOARD:
There were 5 meetings of the Board held during the year. Detailed information is given in the Corporate Governance Report.
CORPORATE GOVERNANCE REPORT:
Pursuant to Clause 49 of the Listing Agreement and SEBI Listing Regulations, 2015, the following have been made a part of the Annual Report and are attached to this report:
- Management Discussion and Analysis Report
- Corporate Governance Report
- Auditorsâ certificate regarding compliance of conditions of Corporate Governance FIXED DEPOSITS:
The Company has not accepted / renewed any deposits within the meaning of Section 73 and Section 74 of the Companies Act, 2013 and the Rules made there under.
DIRECTORâS RESPONSIBILITY STATEMENT:
Pursuant to the provisions of Section 134(3)(c) of the Companies Act, 2013, your Directors state that:-
(1) In the preparation of the annual accounts, for the year ended 31st March, 2016, the applicable Accounting Standards have been followed and that there are no material departures;
(2) Appropriate accounting policies have been selected 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 31st March, 2016 and of the loss of the Company for the year ended 31st March, 2016;
(3) Proper and sufficient care has been taken for 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;
(4) They have prepared the annual accounts on a âGoing Concernâ basis.
(5) Proper internal financial controls were followed by the Company and that such internal financial controls are adequate and were operating effectively.
(6) Proper systems to ensure compliance with the provisions of all applicable laws were in place and that such systems were adequate and operating effectively.
NOMINATION AND REMUNERATION POLICY:
The Board on the recommendation of the Nomination and Remuneration Committee has framed a Remuneration Policy, providing
(a) criteria for determining qualifications, positive attributes and independence of directors and
(b) a policy on remuneration for directors, key managerial personnel and other employees.
The detailed Nomination and Remuneration Policy is placed on Companyâs website at http://www.elandapparel.com/ Nomination%20&%20Remuneration%20Policy.pdf
PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS:
Information regarding loans, guarantees and investments covered under the provisions of Section 186 of the Companies Act, 2013 are detailed in the Financial Statements.
RELATED PARTY TRANSACTIONS:
All related party transactions that were entered into during the financial year were on an armâs length basis and were in the ordinary course of business.
All Related Party Transactions upto 31st March, 2016 were placed before the Audit Committee and the Board for approval. Prior omnibus approval of the Audit Committee was obtained for Related Party Transactions for a period up to 31st March, 2016 and for the financial year 2015-16. The transactions entered into pursuant to the omnibus approval so granted were audited and a statement giving details of all related party transactions was placed before the Audit Committee for its review on a quarterly basis. The Company has obtained the approval of the shareholders by way of special resolution for the material related party transactions. The Board of Directors and the Audit Committee have also approved the said related party transactions.
There are âmaterialâ related party transactions as defined under clause 49 of the Listing Agreement and SEBI Listing Regulations, 2015, the details of the same are disclosed in Form AOC-2 in that regard which is attached as âAnnexure B âto this report.
The Policy on RPTs as approved by Board is uploaded on the Companyâs website at http://www.elandapparel.com
The Company undertakes the transactions of purchase and sale of goods and availing/rendering services with E-Land Group of Companies as mentioned in point 32 in Notes to Accounts.
None of the Directors/Key Managerial Personnel has any pecuniary relationships or transactions vis-a-vis the Company which may have potential conflict with the interest of the Company at large.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO:
Information in accordance with the provisions of Section 134(3)(m) of the Companies Act, 2013, read with the Companies (Accounts) Rules, 2014 regarding Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo is attached as âAnnexure Câ to this report.
RISK MANAGEMENT POLICY:
Information on the development and implementation of a Risk Management Policy for the Company including identification therein of elements of risk which in the opinion of the Board may threaten the existence of the Company is given in the Corporate Governance Report.
VIGIL MECHANISM / WHISTLE BLOWER POLICY:
In accordance with Section 177(9) and (10) of the Companies Act, 2013 and Clause 49(II) (F) of the Listing Agreement, the Company has established a Whistle Blower Policy and Vigil Mechanism. The policy is available on the Companyâs website at http://www.elandapparel.com/whistle-blower-policy.pdf
CORPORATE SOCIAL RESPONSIBILITY:
As the Company does not fall under any of the threshold limits given under the provisions of Section 135 of the Companies Act, 2013, the compliances under CSR are not applicable to the Company.
REFERENCE TO THE BOARD FOR INDUSTRIAL AND FINANCIAL RECONSTRUCTION (âBIFRâ) UNDER THE PROVISIONS OF THE SICK INDUSTRIAL COMPANIES (SPECIAL PROVISIONS) ACT, 1985:
The total losses of the Company as on 31st March, 2016 have exceeded its entire Net Worth. Accordingly, your Company is proposing to make a reference to the BIFR under the provisions of Section 15(1) of the Sick Industrial Companies (Special Provisions) Act, 1985 for determination of the measures that should be adopted by your Company to revive the Company. Your Company is in the process of collating all the requisite data needed for making the reference to the BIFR.
PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES:
The Company has an employee drawing remuneration above the limits mentioned in Section 197(12) of the Companies Act, 2013 read with Rules 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 as amended from time to time, the details of the same is attached in âAnnexure Eâ to this report.
INFORMATION UNDER THE SEXUAL HARRASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013:
The Company has zero tolerance for sexual harassment at workplace and has adopted a policy against sexual harassment in line with the provisions of Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the rules framed there under.
During the financial year 2015-16, the company has not received any complaints on sexual harassment and hence no complaints remain pending as of 31st March, 2016.
SUBSIDIARY
The Company has no Subsidiary.
SIGNIFICANT & MATERIAL ORDERS PASSED BY THE REGULATORS & COURTS.
There were no penalties orders passed during the year.
INTERNAL CONTROL SYSTEMS & THEIR ADEQUACY
The Company has an internal control system, commensurate with the size, scale and complexity of its operations. This ensures that all transactions are authorized, recorded and reported correctly, and assets are safeguarded and protected against loss from unauthorized use or disposition. Your Company has adequate internal controls for its business processes across departments to ensure efficient operations, compliance with internal policies, applicable laws and regulations, protection of resources and assets and appropriate reporting of financial transactions.
The Company has Internal Audit function which is empowered to examine the adequacy and compliance with policies, plans and statutory requirements. It comprises of experienced professionals who conduct regular audits across the Companyâs operations. The Company has also appointed a firm of Chartered Accountants as Internal Auditors, who reviews the various functions of the Company thoroughly and report to the Audit Committee. During the year under review, the Risk Management Committee of the Company had reviewed the new requirement of Internal Control over Financial Reporting (âICOFRâ) and finalized the detailed analysis of key processes, and these were presented for review by the Statutory Auditors. The control mechanism and the process of testing of controls were discussed with the Statutory Auditors. The Statutory Auditors have submitted their report on the Internal Financial Controls which forms an integral part of this Report.
The adequacy of the same has been reported by the Statutory Auditors of your Company in their report as required under the Companies (Auditorâs Report) Order, 2003.
HUMAN RESOURCES:
Your Company considers its Human Resources as the key to achieve its objectives. Keeping this in view, your Company takes utmost care to attract and retain quality employees. The employees are sufficiently empowered and such work environment propels them to achieve higher levels of performance. The constant commitment of the employees is the driving force behind the Companyâs vision. Your Company appreciates the spirit of its dedicated employees.
AUDITORS:
The Company has received a consent letter from M/s. Deloitte Haskins & Sells LLP, Chartered Accountants Mumbai having Firm Registration No.117366W/W-100018, regarding their willingness to act as Statutory Auditors of the Company. The Company has also received a certificate from them to the effect that their appointment, if made, would be in compliance with the conditions as prescribed under Section 139 of the Companies Act, 2013 and they satisfy the criteria as provided under Section 141 of the Act. They have also confirmed their compliance pursuant to Regulation 33(1) (d) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 in respect of âPeer Review Certificateâ issued by the Peer Review Board of ICAI. The Audit Committee and Board of Directors in their meeting held on 12th August, 2016 has recommended the appointment of M/s. Deloitte Haskins & Sells LLP, Chartered Accountants, Mumbai, as Statutory Auditors of the Company, subject to approval of shareholders in ensuing Annual General Meeting.
The Statutory Auditors, M/s. S R B C & CO LLP, Chartered Accountants, Mumbai, have expressed their unwillingness to continue as Statutory Auditors of the Company from conclusion of the ensuing Annual General Meeting. Accordingly they have tendered their resignation to the Board of directors in their meeting held on 12/08/2016. Board has accepted the same.
Your Directors recommend the appointment of M/s. Deloitte Haskins & Sells LLP , Chartered Accountants, Mumbai as Statutory Auditors of the Company to hold office from the conclusion of the ensuing 19th Annual General Meeting up to the conclusion of 24th Annual General Meeting of the Company subject to ratification of the appointment by members at every Annual General Meetings.
AUDITORSâ REPORT
There are no qualifications, reservations or adverse remarks made by M/s. S R B C & CO LLP, Statutory Auditors of the Company, in their report for the financial year ended 31st March, 2016. The Statutory Auditors have not reported any incident of fraud to the Audit Committee or to the Board of the Company in the year under review.
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 Company has appointed M/s. B. K. Pradhan &Associates, a firm of Company Secretaries in Practice having C.P.No.:10179 to undertake the Secretarial Audit of the Company. The Secretarial Audit Report is attached herewith as âAnnexure Dâ.
No adverse comments have been made in the said report by the Practicing Company Secretary.
RECONCILIATION OF SHARE CAPITAL AUDIT:
In compliance of circular no. D&CC/FITTC/CIR-16/2002 dated 31st December, 2002 further amended by Circular No.CIR/ MRD/DP/30/2010 dated 6th September, 2010 issued by the Securities and Exchange Board of India (âSEBIâ), Reconciliation of Share Capital Audit has being carried out at the specified intervals by a Practicing Company Secretary and have been submitted to the Stock Exchanges where the Company is listed within due dates.
APPRECIATION / ACKNOWLEDGEMENT:
Board of Directors wish to express their gratitude and record sincere appreciation for the dedicated efforts of all the employees of the Company. Directors are thankful to the esteemed shareholder for their continued support and confidence reposed in the Company. The Board takes this opportunity to express its gratitude for the valuable assistance and co-operation extended by Government Authorities, Banks, Corporate Debt Restructuring (CDR) Cell, Financial Institutions, Vendors, Customers, Advisors and other business partners.
For and on behalf of the Board
Date: 12th August, 2016 Kwang Hyuck Choi Jung Ho Hong
Place: Mumbai Managing Director Whole-time Director
DIN:02229626 DIN:02229634
Mar 31, 2014
The Members of Mudra Lifestyle Limited,
The Directors present the 17th Annual Report of the Company together
with the Audited Financial Statements for the financial year ended 31st
March, 2014.
FINANCIAL RESULTS:
The financial performance of the Company for the year ended 31st March,
2014 is summarized below:
(Rs. In Lakhs)
Particulars 2013-14 2012-13
(12 Months) (6 Months)
Operational & Other Income 34,670.43 13,399.07
Profit before Interest, Depreciation,
Exceptional Items & Tax (5,427.15) (1,147.63)
Interest 3,579.34 2,839.12
Depreciation & Amortization 2,489.79 1,247.69
Profit/(Loss) before exceptional items
and tax (11,496.28) (5,234.44)
Less: Exceptional Items 8013.88 -
Profit/(Loss) before tax (3,482.40) (5,234.44)
Less/(Add): Provision for Taxation
including prior period adjustments 1138.14 290.03
Deferred Tax 1,010.80 -
Net Profit /(Loss) after tax (1,333.45) (5,524.47)
Balance brought forward (35,515.42) (29,990.95)
Balance carried to Balance Sheet (36,848.87) (35,515.42)
EPS Basic (2.78) (11.51)
EPS Diluted (2.78) (11.51)
Note:The above mentioned figures for current year are for 12 months
i.e. from 1st April, 2013 to 31st March, 2014 whereas the previous
period figures are for 6 months i.e. from 1st October, 2012 to 31st
March, 2013, hence the current year figures are not comparable with the
previous period figures.
OPERATIONS OF THE COMPANY:
During the year under review, the Company earned total revenue of Rs.
34,670.43 Lakhs (Previous year Rs. 13,399.07 Lakhs). Total Expenses
were Rs. 46,166.71 Lakhs (Previous year Rs. 18,633.5 Lakhs). Loss
before tax stood at Rs. 3,482.40 Lakhs (Previous year Rs. 5,234.43
Lakhs). The previous period figures are for 6 months i.e. from 1st
October, 2012 to 31st March, 2013, hence the current year figures are
not comparable with the previous period figures.
DIVIDEND:
As there are no profits, the Board of Directors of the Company do not
recommend any payment of dividend on the shares for the financial year
2013-14. Accordingly, no amounts are proposed to be transferred to
reserves.
REGISTERED OFFICE:
During the year under review, the Registered Office of the Company was
shifted to 509, 5th Floor, Western Edge-I, Western Express Highway,
Magathane, Borivali (East), Mumbai-400066 with effect from Monday, 18th
November, 2013.
BOOK CLOSURE:
The Register of Members and Share Transfer Books shall remain closed
from Monday, 22nd September, 2014 to Friday, 26th September, 2014 (both
days inclusive). The Annual General Meeting of the Company is scheduled
to be held on 30th September, 2014 in Mumbai.
SLUMP SALE OF UNIT D-1 LOCATED AT TARAPUR:
During the year under review, the Company has transferred its Unit D-1
of Fabric Business located at Tarapur on a going concern basis by way
of slump sale to E-Land Fashion India Pvt. Ltd., wholly owned
subsidiary of the holding company viz. E-Land Asia Holding Pte Ltd.
for cash consideration of INR 46.49 Crores.
Approval of the shareholders as required under Section 180(1)(a) of the
Companies Act, 2013 for the said transaction of Slump Sale of Unit D-1
was sought by way of Postal Ballot process, result of which was
declared on 21st March, 2014.
SALE OF NON-CORE ASSETS:
The Company also decided to sell its Non-Core Assets to prospective
Buyers for an appropriate consideration. The Non- Core Assets
identified by the Company are as follows:
* All Units of Daman
* All Units of Bhiwandi
* Unit N-12 of Tarapur
Approval of the shareholders as required under Section 180(1)(a) of the
Companies Act, 1956 for the said Non-Core Assets was sought by way of
Postal Ballot process, result of which was declared on 21st March,
2014.
The Company has already commenced the process of the sale of the above
mentioned Non-Core Assets and ascertained the prospective buyers for
the same. Majority of the transactions are on advanced stage of
completion.
CORPORATE DEBT RESTRUCTURING (CDR):
In order to overcome debt repayment obligations, the Company had
applied for the restructuring of its debts through CDR Mechanism
envisaged under the Reserve Bank of India (RBI) guidelines dated 23rd
August, 2001 and subsequent amendments thereto.The CDR Scheme was
approved by the CDR Cell vide its Letter of Approval dated 27th June,
2012 subject to the compliance of the conditions mentioned therein.The
implementation of the CDR Scheme was to be made within a period of 120
days from the issuance of the said Letter of Approval. The Company has
already executed Master Restructuring Agreement (MRA) and has opened
the Trust and Retention Account (TRA) with SBI on the terms and
conditions set out in Trust and Retention Account Agreement. Other
follow-on procedures such as Security creation in favour of SBI Cap
Trustee Ltd., as a security Trustee for beneficial interest of all
existing CDR lenders for majority of its properties is completed and
for rest of the properties it is in advanced stage for creation of
security.
REFERENCE TO THE BOARD FOR INDUSTRIAL AND FINANCIAL RECONSTRUCTION
("BIFR") UNDER THE PROVISIONS OF THE SICK INDUSTRIAL COMPANIES (SPECIAL
PROVISIONS) ACT, 1985:
The total losses of the Company as on 31st March, 2014 have exceeded
its entire Net Worth. Accordingly, your Company is required to make a
reference to the BIFR under the provisions of Section 15(1) of the Sick
Industrial Companies (Special Provisions) Act, 1985 for determination
of the measures that can be adopted by your Company to revive the
Company. Your Company is in the process of collating all the requisite
data needed for making the reference to the BIFR.
SEBI NOTICE:
As per provisions of Rule 19A of the Securities Contracts (Regulations)
Rules, 1957, and Clause 40A of the Listing Agreement, every listed
company shall maintain public shareholding of at least 25% of its
listed share capital. However, the promoters of the Company, comprising
of Mr. Murarilal Agarwal, Mr. Ravindra Agarwal, Mr. Vishwambharlal
Bhoot (Old Promoters) and E-Land Asia Holdings Pte Ltd. hold 85.79% of
Equity Shares. Accordingly, at present, the public shareholding of the
Company falls short of the required MPS by 10.79%, which is not in
compliance with the said rule and clause.
Your Company had received an order dated 4th June, 2013, issued under
Sections 11(1), 11(2)(j), 11(4) and 11(B) of the SEBI Act, 1992 read
with section 12A of SCRA Act, 1956 in relation to the said non-
compliance with requirement of Minimum Public Shareholding.
The Company''s officials and old promoters of the Company along with
Legal Advisors attended the personal hearing before Securities and
Exchange Board of India (SEBI) on 26th June, 2014. The Company
officials deliberated the various options to comply with MPS
requirement including Offer for Sale. However in view of the extremely
low volume of trading in the shares of the Company and also due to the
shares being categorized for trading in the "Periodic Call Auction"
system, the Company shall require more time to meet the MPS
requirements. SEBI adjourned the meeting till next three months.
SHARE CAPITAL:
The Company''s Authorised Share Capital is Rs. 6,001 Lakhs comprising of
6,00,10,000 Equity Shares of Rs. 10/- each and paid up share capital is
Rs. 4,799.05 Lakhs comprising of 4,79,90,469 Equity Shares of Rs. 10/-
each fully paid up. There was no change in capital of the Company
during the period under review.
LISTING:
The Equity Shares of the Company are listed on BSE Limited (BSE) with
Scrip Code ''532820'' and on The National Stock Exchange of India Limited
(NSE) having symbol as ''MUDRA.
The listing fee for the year 2014-15 has been paid to both the Stock
Exchanges.
DIRECTORS:
Mr. Eung Kyun Shin, Executive Chairman, Mr. Gagan Rai and Mr. Wan Ki
Eun, Independent Directors of the Company resigned from directorship of
the Company with effect from close of working hours of 31st March,
2014, 3rd June, 2014 and 5th August, 2014 respectively due to their
other occupations. Your Directors take this opportunity to express
their deep sense of appreciation for the valuable services rendered by
Mr. Eung Kyun Shin, Mr. Gagan Rai and Mr. Wan Ki Eun during their
tenure as Directors.
Mr. Kyoung Hur has been appointed as an Additional Independent Director
of the Company with effect from 5th August, 2014 and holds office upto
the date of ensuing 17th Annual General Meeting of the Company. The
Company has received a notice from a member of the Company under
Section 160 of the Companies Act, 2013 in respect of his appointment as
the Director at the ensuing Annual General Meeting of the Company,
along with the deposit as prescribed there under.
In accordance with the provisions of Section 152 of the Companies Act,
2013 read with Companies (Management & Administration) Rules, 2014 and
Articles of Association of the Company, Mr. Jung Ho Hong is liable to
retire by rotation at the ensuing 17th Annual General Meeting of the
Company. Mr. Jung Ho Hong, being eligible, offers himself for
re-appointment.
In terms of provisions of Section 149 and 152 of the Companies Act,
2013 read with Companies (Management & Administration) Rules, 2014
which became effective from 1st April, 2014 an Independent Director of
a Company can be appointed for a term of 5 consecutive years and shall
not be liable to retire by rotation.
To comply with the above provisions, it is proposed to appoint Mr.
Chong Tae Baek and Mr. Sivabalan Paul Pandian, Independent Directors of
the Company to hold office as such upto 31st March, 2019 and Mr. Kyoung
Hur as an Independent Director of the Company to hold office as such
upto 4th August, 2019, who shall not be liable to retire by rotation.
Your Board recommends for the above appointments.
The Company has received declarations from all the Independent
Directors of the Company confirming that they meet the criteria of
independence as prescribed both under sub-section (6) of Section 149 of
the Companies Act, 2013 and Clause 49 of the Listing Agreement entered
with the Stock Exchanges.
Brief resume of the Directors proposed to be appointed/re-appointed as
stipulated under Clause 49 of the Listing Agreement with the Stock
Exchanges where the shares of the Company are listed are given in the
Notice convening 17th Annual General Meeting.
The Company had filed requisite Form 25A for approval of appointment
and payment of remuneration for Mr. Jung Ho Hong on 10th May, 2013. The
Central Government approval for appointment and payment of remuneration
of Mr. Jung Ho Hong is pending and the follow up for the same is in
process.
CORPORATE GOVERNANCE REPORT:
Pursuant to Clause 49 of the Listing Agreement entered with the Stock
Exchanges, the following have been made a part of the Annual Report and
are attached to this report:
! Management Discussion and Analysis Report
! Corporate Governance Report
! Auditors'' certificate regarding compliance of conditions of
Corporate Governance
FIXED DEPOSITS:
The Company has not accepted/renewed any deposits from the public
within the meaning of Section 58A and 58AA of the Companies Act, 1956.
PARTICULARS OF EMPLOYEES UNDER SECTION 217(2A):
The Company has no employee drawing remuneration above the limits
mentioned in Section 217 (2A) of the Companies Act, 1956 read with the
Companies (Particulars of Employees) Rules, 1975 as amended, hence no
such particulars are furnished.
DIRECTORS'' RESPONSIBILITY STATEMENT:
Pursuant to the provisions of Section 217(2AA) of the Companies Act,
1956, your Directors state that:- (1) In the preparation of the annual
accounts, for the year ended 31st March, 2014 the applicable Accounting
Standards have been followed and that there are no material departures;
(2) Appropriate accounting policies have been selected 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 31st March, 2014 and of the loss of the Company for
the year ended 31st March, 2014;
(3) Proper and sufficient care has been taken for maintenance of
adequate accounting records in accordance with the provisions of the
Companies Act, 1956, for safeguarding the assets of the Company and for
preventing and detecting fraud and other irregularities;
(4) They have prepared the annual accounts on a "Going Concern" basis.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE
EARNINGS AND OUTGO:
Information in accordance with the provisions of Section 217(1)(e) of
the Companies Act, 1956, read with the Companies (Disclosure of
Particulars in the Report of Board of Directors) Rules, 1988 regarding
Conservation of Energy, Technology Absorption and Foreign Exchange
Earnings and Outgo is given in annexure forming part of this report.
INFORMATION UNDER THE SEXUAL HARRASSMENT OF WOMEN AT WORKPLACE
(PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013:
The Company has constituted an Internal Complaint Committee under
Section 4 of the Sexual Harassment of women at Workplace (Prevention,
Prohibition and Redressal) Act, 2013. During the year, no complaint was
made before the Committee.
INTERNAL CONTROL SYSTEMS & THEIR ADEQUACY:
Your Company has adequate internal controls for its business processes
across departments to ensure efficient operations, compliance with
internal policies, applicable laws and regulations, protection of
resources and assets and appropriate reporting of financial
transactions.
The Company has Internal Audit function which is empowered to examine
the adequacy and compliance with policies, plans and statutory
requirements. It comprises of experienced professionals who conduct
regular audits across the Company''s operations. The Company has also
appointed a firm of Chartered Accountants as Internal Auditors, who
reviews the various functions of the Company thoroughly and report to
the Audit Committee.
The adequacy of the same has been reported by the Statutory Auditors of
your Company in their report as required under the Companies (Auditor''s
Report) Order, 2003.
AUDITORS:
The Statutory Auditors, M/s. K C P L And Associates LLP, Chartered
Accountants, Mumbai, hold the office till the conclusion of the ensuing
Annual General Meeting. The Company has received a letter from them
expressing their unwillingness to continue as Statutory Auditors of the
Company.
The Company has received a letter from M/s. S R B C & CO LLP, and
Associates LLP, Chartered Accountants, Mumbai regarding their
willingness to act as Statutory Auditors of the Company.The Company has
also received a certificate from them to the effect that their
appointment, if made, would be in compliance with the conditions as
prescribed under Section 139 of the Companies Act, 2013 and they
satisfy the criteria as provided under Section 141 of the Act. They
have also confirmed their compliance pursuant to clause 41(1) (h) of
the Listing Agreement in respect of "Peer Review Certificate" issued by
the Peer Review Board of ICAI.The Company has also received a special
notice as required under Section 140(4)(i) of the Companies Act, 2013,
regarding appointment of M/s. S R B C & CO LLP, Chartered Accountants
as Statutory Auditors of the Company.
Your Directors recommend the appointment of M/s S R B C & CO LLP,
Chartered Accountants, Mumbai as Statutory Auditors of the Company to
hold office from the conclusion of the ensuing 17th Annual General
Meeting upto the conclusion of 22nd Annual General Meeting of the
Company subject to ratification of the appointment by members at every
Annual General Meetings.
The observations and comments given by the Auditors in their report
read together with notes to Accounts are self explanatory and hence do
not call for any further comments under Section 217 of the Companies
Act, 1956.
COST AUDITORS:
Pursuant to the provisions of Section 233B of the Companies Act, 1956,
the Company was under the purview of Cost Audit. Based on the
recommendations of the Audit Committee and approved by the Board of
Directors, the Company appointed M/s. Rohit & Associates, Cost
Accountants, Mumbai as the Cost Auditors of the Company for audit of
the cost accounting records for the financial year 2013-14, with the
approval of Central Government.
RECONCILIATION OF SHARE CAPITAL AUDIT:
In compliance of Circular No. D&CC/FITTC/CIR-16/2002 dated 31st
December, 2002 further amended by Circular No.CIR/ MRD/DP/30/2010 dated
6th September, 2010 issued by the Securities and Exchange Board of
India ("SEBI"), Reconciliation of Share Capital Audit has been carried
out at the specified intervals by a Practicing Company Secretary and
have been submitted to the Stock Exchanges where the Company is listed
within due dates.
INDUSTRIAL RELATIONS & EMPLOYEE SAFETY:
Garment Manufacturing Industry is one of the high labour and low
capital intensive industries. Like any other organization in the
manufacturing sector, garment sector have to sustain intense
competition and perpetual changes. Well motivated workforce that
performs up to its potential can make all the difference between a
successful organization and the one that aspires to be the one of the
leading garment manufacturers.
Employee safety is of paramount importance for the Company. All the
executives in the Company have a personal objective of ensuring a safe
working environment for its employees. The safety performance is
analyzed in all important forums.
Various Employee related welfare activities were also undertaken by the
Company for the welfare of all the employees on the occasion of Women''s
Day, World Environment Day, World AIDS Day, Christmas, etc.
Also various Employee Recreation/ Cultural/ Sports/ activities are
undertaken by the Company on occasions of New Year, Labour Day, Gandhi
Jayanthi, Dussehra, Kannada Rajyotsava etc.
We strongly believe that trained and motivated people determine the
future growth of the Company.
Your Company endeavors to attract and recruit best possible talent and
considers the quality of its human resources to be most important.
APPRECIATION / ACKNOWLEDGEMENT:
Board of Directors wish to express their gratitude and record sincere
appreciation for the dedicated efforts of all the employees of the
Company. Directors are thankful to the esteemed shareholder for their
continued support and confidence reposed in the Company. The Board
takes this opportunity to express its gratitude for the valuable
assistance and co-operation extended by Government Authorities, Banks,
Corporate Debt Restructuring (CDR) Cell, Financial Institutions,
Vendors, Customers, Advisors and other business partners.
FOR AND ON BEHALF OF THE BOARD
Sd/- Sd/-
Date: 14th August, 2014 YangweonYoo Jung Ho Hong
Place: Mumbai Managing Director Executive Director
DIN:03629831 DIN:02229634
Sep 30, 2012
To, The Members of Mudra Lifestyles Limited,
The Directors take pleasure in presenting their 15th Annual Report of
the Company together with the Audited Financial Statement of Accounts
for the year ended 30th September, 2012.
FINANCIAL RESULTS:
The financial performance of the Company for the year ended 30th
September, 2012 is summarized below:
(Rs in Lacs)
Particulars 2011-12 2010-11
Operational & Other Income 31364.23 42991.00
Profit Before Interest, Depreciation & Tax (22799.75) 4214.99
Interest 6942.03 4171.88
Depreciation & Amortization 4115.26 2619.25
Profit before tax (33857.04) (2576.14)
Less/(Add): Provision for Taxation including
prior period adjustments (1331.67) (200.86)
Deferred Tax (2426.33) (251.57)
Net Profit /(Loss)after tax (32762.38) (2525.43)
Appropriations NIL
Proposed Dividend NIL NIL
Dividend Tax NIL NIL
Balance brought forward 2771.43 5296.86
Balance carried to Balance Sheet (29990.95) 2771.43
EPS Basic (68.27) (6.30)
EPS Diluted (68.27) (6.30)
Note: The Company''s current financial year is 18 months ending 30th
September, 2012, hence the current year figures are not comparable with
the previous year figures.
OPERATIONS OF THE COMPANY
The Company''s total revenue stood at Rs 31,364.23 Lakhs. Total Expenses
were Rs 65,221.27 Lakhs. Loss before tax stood at Rs 34,076.09 Lakhs
and Loss after tax stood at Rs 32,762.38 Lakhs. The current Financial
Year consist of 18 months (as the same was extended by 6 months upto
30th September, 2012), hence current year figures are not comparable.
DIVIDEND
As there are no profits for the year, your Directors has not
recommended any dividend on the shares for the financial year 2011-12.
Accordingly, no amounts are proposed to be transferred to reserves.
The register of members and share transfer books will remain closed
from Monday, 18th March, 2013 to Friday, 22nd March, 2013 both days
inclusive. The Annual General Meeting of the Company is scheduled to be
convened on 22nd March, 2013 at Mumbai.
CORPORATE DEBT RESTRUCTURING(CDR):
During the year, due to factors affecting economies at macro-economic
level and industry downtown and substantial working capital erosion,
the Company started facing liquidity crunch and it was not able to
fulfill its repayment obligations on timely basis. In order to overcome
debt repayment obligations, the Company had applied for the
restructuring of its debts through CDR Mechanism envisaged under the
Reserve Bank of India (RBI) guidelines dated August 23, 2001 and
subsequent amendments thereto which was approved by the CDR Cell vide
their letter of approval dated June 27, 2012 subject to the compliance
of the conditions mentioned therein and the implementation of the CDR
Scheme within a period of 120 days from the issuance of the Letter of
Approval. The Company executed Master Restructuring Agreement (MRA) on
24th September 2012 and other follow-on procedures such as Security
creation in favour of SBI Cap Trustee Ltd., as a Security Trustee for
beneficial interest of all existing lenders , opening of Trust &
Retention Accounts (TRA) are at advance stage of completion.
SHARE CAPITAL
During the year under review, your Company''s Authorised Share Capital
is at Rs 6,001.0 Lakhs comprising of 60,010,000 Equity Shares of Rs.
10/- each. The Company''s paid up capital Rs 4,799.05 Lakhs comprising
of 4,79,90,469 Equity Shares of Rs. 10/- each fully paid up.
SUBSIDIARY COMPANIES:
Your Company do not have any subsidiary company hence the compliance of
provisions of section 212 of the Companies Act, 1956 are not
applicable.
SHIFTING OF REGISTERED OFFICE OF THE COMPANY
The Board of Directors at its meeting held on 4th August, 2012 had
decided to shift the registered office of the Company to 3026, A-Wing,
3rd Floor, Oberoi Garden Estate, Chandivali Farm Road, Chandivali,
Andheri (East), Mumbai-400072 within the same city i.e. Mumbai with
effect from 11th August, 2012, accordingly, e-Form 18 was filed with
Registrar of Companies, Mumbai which was duly approved.
DIRECTORS
In terms of the provisions of Section 255 and 256 of the Companies Act,
1956 and the Articles of Association of the Company, Mr. Sivabalan Paul
Pandian and Mr. Chong Tae Baek are liable to retire by rotation at the
ensuing 15th Annual General Meeting of the Company, Mr. Sivabalan Paul
Pandian and Mr. Chong Tae Baek, being eligible, offers themselves for
re-appointment.
In accordance with the provisions of the Companies Act, 1956 and the
Articles of Association of the company, Mr. Wan Ki Eun, was appointed
as Additional Director of the Company whose term expires on the date of
ensuing Annual General Meeting of the Company. It is proposed to
appoint him as an Independent Director of the Company liable to retire
by rotation.
The above appointment / re-appointment forms part of the notice
convening the Annual General Meeting and the resolutions are
recommended for your approval.
The details of their appointment/re-appointment together with nature of
their expertise in specific functional areas and names of the companies
in which they hold office as Director and/or the Chairman/ Membership
of Committees of the Board, if any are provided in the Notice of this
Annual General Meeting.
During the year under review, Mr. Surendra Ambalal Dave( w.e.f. 11th
May, 2011) ; Mr. Parameshwaran Nair( w.e.f. 13th August, 2011) ; Mr.
S.C Bhargava (w.e.f 9th November, 2011); Mr. Murarilal Agarwal ( w.e.f.
22nd March, 2012); Mr. Ravindra Agarwal( w.e.f. 22nd March,2012); Mr.
Kyoung Hur ( w.e.f. 4th August, 2012) and Mr. Mrithyunjay
Amblimath(w.e.f 4th August, 2012), Directors of the Company had
expressed their inability to continue as Directors of the Company due
to their other professional pre-occupations and had rendered their
resignation.
The Board places on record its appreciation for the valuable services
rendered by them during their tenure as Directors of the Company.
MANAGEMENT DISCUSSION AND ANALYSIS & CORPORATE GOVERNANCE REPORT
Management Discussion & Analysis and Corporate Governance Report for
the year under review as stipulated under Clause 49 of Listing
Agreement with the Stock Exchange in India is presented in the separate
section forming part of this Annual Report.
The Practicing Company Secretary has certified the Company''s compliance
of the requirements of Corporate Governance in terms of Clause 49 of
the Listing Agreement and the same is annexed to the Report of the
Corporate Governance.
FIXED DEPOSITS
The Company has not accepted any deposit, within the meaning of section
58A of the Companies Act, 1956 read with the Companies (Acceptance of
Deposits) Rules, 1975, made there under.
PARTICULARS OF EMPLOYEES UNDER SECTION 217(2A):
The Company has no employee drawing remuneration above the limits
mentioned in section 217 (2A) of the Companies Act, 1956 read with the
Companies (Particulars of Employees) Rules, 1975 as amended.
DIRECTOR''S RESPONSIBILITY STATEMENT
Pursuant to Section 217(2AA) of the Companies Act, 1956, your Directors
state that:-
(1) In the preparation of the annual accounts for the year ended 30th
September 2012, the applicable accounting standards have been followed
and that there are no material departures.
(2) Appropriate accounting policies have been selected 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 30th September 2012 and of the loss of the Company
for the year ended 30th September 2012.
(3) Proper and sufficient care has been taken for maintenance of
adequate accounting records in accordance with the provisions of the
Companies Act, 1956, for safeguarding the assets of the Company and for
preventing and detecting fraud and other irregularities.
(4) The annual accounts have been prepared on a going concern basis.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE
EARNINGS AND OUTGO
Information in accordance with the provisions of section 217(1)(e) of
the Companies Act, 1956, read with the Companies (Disclosure of
Particulars in the Report of Board of Directors) Rules, 1988 regarding
conservation of energy, technology absorption and foreign exchange
earnings and outgo is given in annexure forming part of this report.
INTERNAL CONTROL SYSTEMS & THEIR ADEQUACY
Your Company has adequate internal controls for its business processes
across departments to ensure efficient operations, compliance with
internal policies, applicable laws and regulations, protection of
resources and assets and appropriate reporting of financial
transactions.
The Company has Audit function which is empowered to examine the
adequacy and compliance with policies, plans and statutory
requirements. It comprises of experienced professionals who conduct
regular audits across the Company''s operations. The Company has also
appointed a firm of Chartered Accountants as Internal Auditors, who
review the various functions of the Company thoroughly and report to
the Audit Committee.
The adequacy of the same has been reported by the Statutory Auditors of
your Company in their report as required under the Companies (Auditor''s
Report) Order, 2003.
AUDITORS'' REPORT
- As regards observations in point no. 4 of Auditors'' Report, the
Statutory Auditors have qualified their report with a remark that the
company has not filed the requisite applications with Central
Government in terms of the provisions of Section 269 read with Schedule
XIII of the Companies Act, 1956 (''the Act''), to seek approval for the
appointment & remuneration of eight foreign national Directors.
In the opinion of the Directors, approval of the Central Govt. is to be
sought for the appointment and payment of remuneration for only 4
foreign national Directors i.e. the Chairman of the Board, Managing
Director and 2 Whole Time Directors. Availing of No-Objection
Certificate (NOC) from the Bankers is a prerequisite for availing for
the approval of the Central Government in respect of the appointment
and payment of remuneration to the Managerial Personnel pursuant to
Schedule XIII of the Act. Since your company was under the process of
the restructuring of its debts, availing of NOC from the Bankers got
delayed, which would result in applying for condonation of delay to the
Company Law Board (CLB).
However, as on date the NOC has been availed from most of the bankers
and the process of filing of application to Central Government along
with the condonation of delay shall be complied at the earliest.
- With regard to observation of the Auditors on Sr No. 5 in the
Auditor''s Report relating to Note 4 "Long Term Borrowings" and Note
8 "Short Term Borrowings" of the Financial Statements, your Company
has taken necessary steps to ensure the reconciliation in order to
determine the accuracy of the interest working reversed by all the
banks as stated in Master Restructuring Agreement (MRA) read along with
CDR.
- With regard to observation of the Auditors on Sr no. 6 in the
Auditor''s Report, the Auditors have stated that "Inventories"(Note
16) of Financial Statements, wherein the company has shown Inventory of
Rs. 6,677.14 Lakhs (P.Y.20,451.23 Lakhs). During the period the
Company has carried out physical stock taking by independent auditors
appointed by the Company
in the month of September 2011 onwards, wherein the Company has
discovered that it does not have stock amounting to Rs. 13,225.60 Lakhs
and accordingly, the Company has written off such non-existent stock in
the books of accounts. As per information and explanation given to us
the company is in the process of investigating reasons for non
existence of such stock. In absence of final conclusion of such
investigation we are unable to ascertain as to whether the amount of
Profit/Loss of the period and relevant assets have been under or
overstated."
Your Directors state that pursuance to preliminary investigation, your
Company has collected documentary evidence to enable them to
substantiate case of deterioration in the value of the stock including
the deficiency in the stock and accordingly written off the non-moving,
obsolete and non existing stock Company is also in the process of
further detailed investigation to know the exact cause of non existence
of physical stocks and reasons thereon. Pending investigation, Company
has already given accounting effect to such non-existing stocks. Hence,
the Company opinioned contrary to auditors opinion as to whether the
amount of Profit/Loss of the period and relevant assets have been under
or overstated.
- As regards the observation in point no. 7 in the Auditor''s Report,
the Statutory Auditors has qualified their report with a remark that
the Company has not considered all the direct costs in valuation of raw
Material and work-in-Progress and the finished goods have been valued
at net realizable value without ascertaining the cost thereof, hence AS
2 was not complied with.
In the opinion of the Directors, Company has taken appropriate
corrective measure to ensure compliance with Accounting Standard 2
"Valuation of Inventories". Company has also appointed cost
Auditors who are helping Company in proper valuation of inventories.
Company was successfully able to do the valuation of inventories as per
AS 2 for the quarter ended December 2012 and the statutory auditors has
removed the said qualification from their limited review report.
- As regards the observation in point no. 8 in the Auditor''s Report,
the Statutory Auditors have qualified their report with a remark that
in Note 19 to the Accounts "Short -Term Loans & Advances" of
Financial Statements amounting to Rs. 190.14 Lakhs has been recorded as
"Focus Product Receivable" and corresponding income has been
credited in the Statement of Profit & Loss, in the absence of requisite
licence under the scheme, the income and assets has been overstated to
that extent.
In the opinion of the Directors, your Company is taking necessary steps
to obtain the requisite licence under the scheme so that the benefit
can be availed.
- As regards the observation in point no. 9 in the Auditor''s Report,
the Statutory Auditors have qualified their report with a remark that
there have been certain misappropriation of funds of the Company during
the period of financial year 2003-04 to financial year 2009-10. The
Company''s investigation is under process hence, no provision for the
misappropriations of funds have been made in the books of accounts.
Since the matter is under investigation and the amounts are pending
detailed explanation and quantification, the Auditors were unable to
comment as to whether the books of accounts give a true and fair view.
Your Directors states that your Company is under process of carrying
out detailed investigation in the said matter, as already mentioned
above, also, due to change in management, senior staff, voluminous and
complex nature of work involved, process of investigation is taking
longer time than expected.
AUDITORS
The Statutory Auditors, M/s. KCPL & Associates, Chartered Accountants,
Mumbai, holds the office till the conclusion of the ensuing Annual
General Meeting. The Company has received a certificate from them to
the effect that their appointment, if made, would be within the
prescribed limits under section 224(1B) of the Companies Act, 1956.
The Statutory Auditors have also confirmed their compliance pursuant to
clause 41(1) (h) of the Listing Agreement in respect of "Peer Review
Certificate" issued by the Peer Review Board of ICAI.
The Board recommends their reappointment.
COST AUDITORS
The Company has come under the purview of Cost Audit for the first time
for the financial year 2012-13 and onwards. Based on the
recommendations of the Audit Committee, the Board of Directors has
approved the appointment of M/s Rohit & Associates as the Cost Auditors
of the Company for the financial year 2012-13, subject to the approval
of the Central Government. As required under the provisions of Section
224(1B) read with Section 233B(2) of the Companies Act, 1956, the
Company has obtained a written confirmation from M/s Rohit & Associates
of their eligiblility for appointment as Cost Auditors under Section
233B of the Companies Act, 1956. The Audit Committee has also received
a certificate from the Cost Auditor certifying their independence and
arm''s length relationship with the Company.
RECONCILIATION OF SHARE CAPITAL AUDIT
In compliance of circular no. D&CC/FITTC/CIR-16/2002 dated 31st
December, 2002 further amended by Circular No.CIR/ MRD/DP/30/2010 dated
6th September, 2010 issued by the Securities and Exchange Board of
India ("SEBI"), Reconciliation of Share Capital Audit has being
carried out at the specified intervals by a Practising Company
Secretary and have been submitted to the Stock Exchanges where the
Company is listed within due dates.
INDUSTRIAL RELATIONS & EMPLOYEE SAFETY
Garment Manufacturing Industry is one of the high labour and low
capital intensive industries. Like any other organization in the
manufacturing sector, garment sector have to sustain intense
competition and perpetual changes. Well motivated workforce that
performs up to its potential can make all the difference between a
successful organization and the one that aspires to be the one of the
leading garment manufacturers.
Employee safety is of paramount importance for the Company. All the
executives in the Company have a personal objective of ensuring a safe
working environment for its employees. The safety performance is
analyzed in all important forums.
We strongly believe that trained and motivated people determine the
future growth of the Company.
Your Company endeavors to attract and recruit best possible talent and
considers the quality of its human resources to be most important.
CAUTIONARY STATEMENT
Statements in this report, particularly those which relate to
Management Discussion and Analysis, describing the Company''s objective,
projections, estimates and expectations may constitute ''forward looking
statements'' within the meaning of applicable laws and regulations.
Forward looking Statements are based on certain assumptions and
expectations of future events. The Company cannot guarantee that these
assumptions and expectations are accurate or will be realized. The
Company''s actual results, performance or achievements might differ
materially from those either expressed or implied herein.
APPRECIATION / ACKNOWLEDGEMENT:
Board of Directors wish to express their gratitude and record sincere
appreciation for the dedicated efforts of all the employees of the
Company. Directors are thankful to the esteemed stakeholders for their
continued support and confidence reposed in the Company. The Board
takes this opportunity to express its gratitude for the valuable
assistance and co operation extended by Government Authorities, Banks,
Corporate Debt Restructuring (CDR) Cell, Financial Institutions,
Vendors, Customers, Advisors and other business partners.
FOR AND ON BEHALF OF THE BOARD
Sd/-
Eung Kyun Shin
Chairman
Date: 4th February, 2013
Place: Mumbai
Mar 31, 2011
The Members of Mudra Lifestyles Limited,
The Directors take pleasure in presenting their 14th Annual Report of
the Company together with the audited financial statements for the year
ended 31st March, 2011.
FINANCIAL RESULTS:
The financial performance of the Company for the year ended 31 st
March, 2011 is summarized below:
Rs. in Lakhs
Particulars 2010-11 2009-10
Operational & Other Income 42937.99 36391.86
Profit Before Interest, Depreciation & Tax 4165.17 5527.07
Interest 4100.77 2222.47
Depreciation & Amortisation 2640.54 1615.49
Profit before tax (2576.14) 1689.11
Less/(Add): Provision for Taxation
including prior period adjustments (200.86) 232.88
Deferred Tax (251.57) 395.87
Net Profit /(Loss)after tax (2525.43) 1060.36
Appropriations
Proposed Dividend NIL 215.94
Dividend Tax NIL 35.86
Balance brought forward 5296.86 4488.30
Balance carried to Balance Sheet 2771.43 5296.86
OPERATIONS OF THE COMPANY:
The Company has achieved total income for the year of Rs. 42937.99 Lacs
as against Rs. 36391.86 Lacs in the previous year. The net profit/
(Loss) for the year was Rs. (2525.43) Lacs as against Rs. 1060.36 Lacs
in the previous year. The Profit before Interest, Depreciation & Tax
decreased from Rs. 5527.07 Lacs in previous year to Rs. 4165.17 Lacs in
the current year, Due to increase in interest and depreciation cost,
net Loss is Rs. (2525.43) Lacs in the current year as against net
profit of Rs. 1060.36 Lacs in the previous year. The export sales
increased to Rs. 6809.02 Lacs as against export sales of Rs. 3242.49
Lacs in the previous year.
During the year performance of the company suffered due to various
factors such as very high volatility in the prices of Cotton Yarn, our
main raw material, all round increase in other input cost, continuous
increase in interest cost etc. The company has completed II phase of
expansion during the year, but, due to shortage of working capital and
other repayment obligations, the company could not work at full
capacity,
The Company is hopeful that going forward from second half of current
year performance of the company should improve gradually as now The
Company has positioned itself as an integrated multi product, multi
fiber and multi market player covering the entire textile value chain
at length. The Company's target market is a diverse mix of the domestic
market, garment export trade and international market (exports) to
ensure risk diversification and stability of earning. After
commissioning of both phase of mega project at Tarapur, the company has
positioned itself in upper segment of the textile market.
SHARE SUBSCRIPTION AGREEMENT, PREFERENTIAL ISSUE:
During the year the Company has entered into Share Subscription
Agreement with E Land Fashion China Holdings Limited (the investor),
and 3 Promoters of the Company, on 15th October, 2010. Pursuant to this
Agreement, the investor E Land Fashion China Holdings Limited has been
allotted 1,20,00,000 (One Crore Twenty Lacs) equity shares of Rs. 10/-
(Rupees Ten) at a price of Rs.60/- (Rupees Sixty).
The members of the company had accorded their consent to the
preferential allotment of equity shares to the investor E Land Fashion
China Holdings Limited, vide extra ordinary general meeting held on
13th November, 2010. Subsequently equity shares were allotted vide
Board resolution dated 27th November, 2010.
The Company has received In Principle Approval, for listing of these
shares, from Bombay Stock Exchange Limited (BSE) vide its letter dated
16th November, 2010 and from National Stock Exchange of India Limited
(NSE) vide its letter dated 24th November, 2010.
Pursuant to provisions of Share Subscription Agreement, Mr. Eung Kyun
Shin was appointed as a Director of the Company with effect from 27th
November, 2010 and Mr. Jung Ho Hong, as an Observer of the company.
OPEN OFFER FOR ACQUISITION OF EQUITY SHARE OF THE COMPANY:
As Company has entered into Share Subscription Agreement with E Land
Fashion China Holdings Limited (the investor) and 3 promoters of the
Company and preferential issue of 1,20,00,000 (One Crore Twenty Lac),
equity shares was made to the Investor, this amounted to acquisition of
25.005% of post issue capital of the Company by the investors.
The provisions of SEBI (Substantial Acquisition of Shares and Transfer)
Rules, 1997, become applicable to this transaction and requiring the
investor to make open offer for the acquisition of at least 20% of
equity shares of the same.
The investor has made the open offer for acquisition of 95,98,094
(Ninety Five Lacs Ninety Eight Thousand Ninety Four) equity shares,
vide public announcement dated 21 st October, 2010.
Pursuant to Agreement entered between existing promoters and the
investor, the investor has purchased further shares from the existing
promoters of the Company and the Company has recognize the Investor as
the majority Shareholder and promoter of the Company.
MEGA EXPANSION PROJECT:
During the year, the company has completed and implemented Expansion of
processing and garmenting project of phase II of Mega Expansion
Project.
DIVIDEND:
Your Directors regret their inability to declare any dividend for the
year due to loss incurred during the year.
LISTING:
The Equity Shares of the Company are listed on Bombay Stock Exchange
Limited, Mumbai (BSE) with script code no. 532820 and The National
Stock Exchange of India (NSE) with script code as Mudra.
The listing fee for the year 2011-12 has been paid.
SUBSIDIARY COMPANIES:
Your Company do not have any subsidiary company hence the compliance of
provisions of section 212 of the Companies Act, 1956 are not applicable.
DIRECTORS:
Pursuant to provisions of Share Subscription Agreements entered by the
Company, Mr. Eung Kyun Shin, was inducted, as an Additional Director,
on the Board of the Company on 27th November, 2010. Mr. Eung Kyun Shin
will hold office of Director till the conclusion of the Annual General
Meeting. The Board has received notice under section 257 of the
Companies Act, 1956, recommending his candidature for reappointment,
along with necessary deposit amount. Hence the Board recommends his
appointment as Director, at the ensuing Annual General Meeting.
During the year Dr. G. Parmeshwaran Nair was appointed as an Additional
Director of the Company with effect from 11th May, 2011 but due to his
other preoccupations he expressed his inability to continue as Director
of the Company and tendered his resignation with effect from 13th
August, 2011. The Board has accepted his resignation in its meeting
held on 23rd August, 2011.
During the year under review, Mr. Vishwambharlal Bhoot and Dr. S. A.
Dave, Directors of the Company has expressed their inability to
continue as Directors of the Company due to their other pre occupations
and rendered their resignation with effect from 27th November, 2010 and
24th March, 2011 respectively. Board took on record their devotion and
effort put in, during their tenure as Director.
In accordance with the provisions of the Companies Act, 1956, Mr. S. C.
Bhargava is liable to retire by rotation at the forthcoming annual
general meeting and being eligible, have offered himself for
re-appointment.
It is brought to the notice of the members that at the meeting of the
Board of Directors, held on 23rd August, 2011, the Board has resolved
to appoint Mr. LeeEun Hong as a Chairman of the Board in place of Mr.
MurarilalAgarwal. Mr. LeeEun Hong will be acting as a Chairman for all
the meeting of the Board, as well as meetings of the members, after the
conclusion of the ensuing Annual General Meeting.
It is further brought to the notice of the members that at the meeting
of the Board of Directors held on 23rd August, 2011, the Board has
discussed about the appointment of Mr. Eung Kyun Shin, as a Managing
Director of the Company. As discussed and resolved, Mr. Eung Kyun Shin
was appointed as a Managing Director of the Company with effect from
23rd August, 2011 (currently without paying any remuneration). The
other terms and conditions, including the remuneration, will be
discussed at the next Board Meeting after the Annual General Meeting.
If discussed and resolved in this regards, the approval of the members
will be sought accordingly.
CORPORATE GOVERNANCE:
Report on Corporate Governance of the Company and Management Discussion
and Analysis Report for the year under review, as per the requirements
of Clause 49 of the Listing Agreement(s), have been given under a
separate section and forms part of this Annual Report.
FIXED DEPOSITS:
The Company has not accepted any deposit, within the meaning of section
58A of the Companies Act, 1956 read with the Companies (Acceptance of
Deposits) Rules, 1975, made there under.
PARTICULARS OF EMPLOYEES UNDER SECTION 217(2A):
The Company has no employee drawing remuneration above the limits
mentioned in section 217 (2A)of the Companies Act, 1956 read with the
Companies (Particulars of Employees) Rules, 1975 as amended.
DIRECTORS' RESPONSIBILITY STATEMENT:
Pursuant to Section 217(2AA) of the Companies Act, 1956, your Directors
state that:-
1. In the preparation of the Annual Accounts, the applicable
accounting standards has been followed along with proper explanation
relating to material departures, if any.
2. In preparation of Accounts, the Company has selected accounting
policies and applied them consistently and made judgment 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 and Loss of the Company for the year.
3. In the preparation of accounts, the Company has taken proper and
sufficient care for the maintenance of adequate accounting records in
accordance with the provisions of this act for safeguarding the assets
of the company and for preventing and detecting fraud and other
irregularities.
4. In the preparation of Accounts, the going concern concept has been
followed.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE
EARNINGS AND OUTGO:
Information in accordance with the provisions of section 217(1 )(e) of
the Companies Act, 1956, read with the Companies (Disclosure of
Particulars in the Report of Board of Directors) Rules, 1988 regarding
conservation of energy, technology absorption and foreign exchange
earnings and outgo is given in annexure forming part of this report.
AUDITORS:
The Statutory Auditors, M/s. Churiwala & Co., Chartered Accountants,
Mumbai, holds the office till the conclusion of the ensuing Annual
General Meeting. The Company has received a certificate from them to
the effect that their appointment, if made, would be within the
prescribed limits under section 224(1 B) of the Companies Act, 1956.
The Statutory Auditors have also confirmed their compliance pursuant to
clause 41(1 )(h) of the Listing Agreement in respect of "Peer Review
Certificate" issued by the Peer Review Board of ICAI.
The Board recommends their reappointment.
INDUSTRIAL RELATIONS:
Your Company has an enviable track record of successful human capital
management, which has remained the source of sustainable competitive
advantage. Your Company's growth and success has generated due to
talent and expertise of its employees. The relations with employees at
all levels have been cordial throughout the year.
APPRECIATION /ACKNOWLEDGEMENT:
Board of Directors wish to express their gratitude and record sincere
appreciation for the dedicated efforts of all the employees of the
Company. Directors are thankful to the esteemed shareholder for their
continued support and confidence reposed in the Company. The Board
takes this opportunity to express its gratitude for the valuable
assistance and co operation extended by Government Authorities,
Financial Institutions, Banks, Vendors, Customers, Advisors and
Other business partners.
FOR AND ON BEHALF OF THE BOARD
Place: Mumbai MURARILAL B. AGARWAL
Dated: 23rd August, 2011. Chairman & Managing Director
Mar 31, 2010
The Directors have pleasure in presenting their 13th Annual Report
together with the audited statement of accounts of the Company for the
year ended 31 st March, 2010.
FINANCIAL RESULTS (Rs. in Lacs)
2009-10 2008-09
Operational & Other Income 36391.86 31476.70
Pofit Before Interest, Depreciation & Tax 5527.07 4144.19
Interest 2222.47 1290.45
Depreciation 1615.49 797.65
Profit before tax 1689.11 2056.09
Less. Provision for Taxation including
period adjustments 232.88 249.50
Deferred Tax 395.87 434.05
Net Profit after tax 1060.36 1372.54
Appropriations
Proposed Dividend 215,04 215.94
Dividend Tax 35.86 44.92
Balance brought forward 4488.30 3840.19
Balance carried to Balance Sheet 5296.86 4488.30
OPERATIONS OF THE COMPANY
The Company has achieved total income for the year Rs. 36391.86 Lacs as
against Rs. 31476.70 Lacs in the previous year. The net profit for the
year was Rs. 1060.36 Lacs as against Rs. 1372.54 Lacs in the previous
year. The Profit before Interest, Depreciation & Tax improved from Rs.
4144.19 Lacs in previous year to Rs. 5527.07 Lacs in the current year,
however, due to increase in interest and depreciation cost, net profit
declined to Rs. 1060.36 lacs in the current year as against net profit
of Rs. 1372.54 Lacs in the previous year.
The Company has positioned itself as an integrated multi product, multi
fiber and multi market player covering the entire textile value chain
at length. The Companys target market is a diverse mix of the domestic
market, garment export trade and international market (exports) to
ensure risk diversification and stability of earning. After
commissioning of mega project at Tarapur, the company has positioned
itself in upper segment of the textile market. The Company is making
continuous efforts in up-gradation of technology and also expanding its
capacity to reduce the cost and to remain as a competitive supplier of
high quality products in the domestic as well as in the international
market.
MEGA EXPANSION PROJECT
During the year, the company implemented weaving and yarn dyeing
project of phase It of Mega Expansion Project. Expansion of Processing
and Garmenting segment is expected to be completed by first half of the
Current Year 2010-11.
DIVIDEND
Your Directors are pleased to recommend dividend of Rs 0.60/- per
Equity Share on face value of Rs. 10/- per equity share i.e @ 6% for
your approval Total outgo Including dividend tax would be Rs 251.80
lacs
JDIRECTORS
During the year, there were no change in the Directorship of the
Company. Mr. V.K.Bhoot, Director of the Company retire by rotation at
this Annual General Meeting and is eligible for re-appointment which
the Board recommends.
FIXED DEPOSITS
During the year, the Company has not accepted any fixed deposits u/s
58Aof the Companies Act, 1956.
RESPONSIBILITY STATEMENT
Pursuant to Section 217(2AA) of the Companies Act. 1956, your Directors
state Ihat:-
1. In the preparation of the Annual Accounts, the applicable
accounting standards had been followed alongwith proper explanation
relating to material departures, if any.
2. In preparation of Accounts, the Company had selected accounting
policies and applied them consistently and made judgment 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 and Loss of the Company for the year.
3. In the preparation of accounts, the Company has taken proper and
sufficient care for the maintenance of adequate accounting records in
accordance with the provisions of this act for safeguarding the assets
of the company and for preventing and detecting fraud and other
irregularities.
4. In the preparation of Accounts, the going concern concept has been
followed.
PARTICULARS OF EMPLOYEES
The Company has no employee drawing remuneration above the limit
mentioned at 217(2A) of the Companies Act, 1956 and accordingly no
statement Is annexed.
CONSERVATION OF ENERGY. TECHNOLOGY ABSORPTION AND
FOREIGN EXCHANGE EARNINGS AND OUTGO
Astatement showing particulars required under the Companies (Disclosure
of Particulars in the Report of the Board of Directors) Rules. 1988.
read with Section 217(1)(e) of the Companies Act, 1956, in the
prescribed forms (Form Aand Form BJ is attach herewith and marked
asAnnexure A.
During the year foreign exchange earnings were Rs. 3242.49 Lacs and
Foreign Exchange outgoings were Rs. 3789.87 Lacs. Thus the Company is a
net foreign exchange user with net flow of Rs. 547.38 Lacs.
AUDITORS
Tha Company has received a letter under section 224 (2) (b) of the
Companies Act, 1956 from M/s V. K. Beswal, retiring auditors, informing
their intension to discontinue as auditor and also received a
confirmation tetter under section 224 (1 B) of the Companies Act,1956,
from Churiwata & Co.. Chartered Accountants mentioning there in that
their appointment lf made, will be within prescribed limit as per
section 224(1 B) of the Companies Act, 1956.
CORPORATE GOVERNANCE
Tha Securities and Exchange Board of India (SEBI) has prescribed
Corporate Governance Standards. Your Directors reaffirm their
commitment to these standards and this Annual Report carries a section
on Corporate Governance.
INDUSTRIAL RELATIONS
Your Company has an enviable track record of successful human capital
management, which has remained the sou rce of sustainable competitive
advantage. Your Companys growth and success has generated due to
talent and expertise of its employees. The relations with employees at
all levels have been cordinal throughout the year.
APPRECIATION
The Board wishes to express its thanks to the Stakeholders, Companys
bankers and various Government authorities for their support and
co-operation, during the year under review. The Board also wishes to
express its appreciation to the employees of the Company and their
families for their dedication, contribution and support during the year
under review.
ON BEHALF OF THE BOARD
Place: Mumbai MURARILAL B. AGARWAL
Dated: 25thAugust. 2010 CHAIRMAN & MANAGING DIRECTOR
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